A powerful way to co-finance your project Joint Implementation is a powerful way to co-finance projects because it can significantly cut the cost of finance and capital. Structuring a Joint Implementation deal around a project which cuts emissions of greenhouse gases can create a new asset for the project: carbon credits, or, strictly Emission Reduction Units (ERUs). | Reducing the need for equity While the process can be bureaucratic, the result is that this asset can be sold for cash upfront, which reduces the need for equity and the burden of collateral on your core project assets. | Covers 10% or more of the project investment Funding from sale of ERUs can often make up 10% or more of the project investment. This can significantly increase the return on equity which the project developer makes. The extra cash which JI brings can often make a project profitable which would otherwise be considered too risky or not viable. |
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| In a Joint Implementation transaction, a seller agrees to deliver a certain number of ERUs to a buyer during the first Kyoto commitment period (2008-2012). The number of ERUs is determined by comparing the projects baseline (or business as usual) carbon emissions to emissions after the project has been implemented. This calculation is based on a detailed analysis of technical and financial considerations. The methodology and numbers must be approved by a third-party validator. |
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