Council signs $3m plus deal for carbon credits sale

19 September 2006

Christchurch City Council has approved the sale of its carbon credits to British Gas. The sale, New Zealand’s first overseas carbon credit sale to a private sector buyer, will help reduce greenhouse gas emissions and generate more than $3 million in revenue, subject to exchange rates, for the Council over five years (between 2008 and 2012).

In December 2004, the New Zealand Government awarded the Council 200,000 carbon credits (or Emission Reduction Units) for the capture and transport of methane gas from the closed Burwood Landfill to QEII Park to heat and power the sports facility. This award, made through the Projects to Reduce Emissions Programme, forms part of the Government’s response to its commitments under the Kyoto Protocol.

"Christchurch continues to be a New Zealand leader in the looking at innovative environmental initiatives," says Cr Sally Buck. "It is exciting that the Council is the first in the country to sell its carbon credits to a private sector buyer. It is one of only a handful of purchase agreements that have been made in New Zealand."

Landfills generate methane, one of the worst greenhouse gases, as organic matter decomposes. When methane is burnt, it is converted to carbon dioxide which reduces its climate impact by a factor of twenty-one.

This project will turn waste into a resource through the capture and use of landfill gas that would have otherwise escaped into the environment contributing to climate change. Using landfill gas at QEII Park will also replace 1.5 million litres of Liquid Petroleum Gas each year, helping to reduce the Council’ s reliance on fossil fuels.

By capturing the methane gas in this way the carbon emissions avoided by this project equals 10,900 cars taken off the road each year (assuming that a petrol powered vehicle travels 15,000 km each year and based on the carbon calculator found at www.nzbcsd.org.nz/climatechange) and the electricity generated by this project would power about 200 households (assuming a household would use 8,000 KW hours of electricity each year).

Council’s Senior Planner, Tony Moore says the sale of the carbon credits made this project possible. "The signing of this contract is the culmination of two years work by a range of people including a local carbon broker Carbon Market Solutions, who were instrumental in the transaction process. The project is well advanced with the pipeline between Burwood Landfill and QEII Park laid, and additional wells sunk for the collection of the gas at the landfill. It is expected to be completed and operational in March 2007".

Cr Buck says the Council sees the now shelved, Projects to Reduce Emissions Programme as an important way to create incentives for emission reductions. "The Council would support the Government in reinstating similar schemes to reduce risks associated with climate change. Creating incentives for emission reductions is both good for business and the environment."

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