Groundbreaking Greenhouse Gas Emissions Trade Between Suncor Energy and Niagara Mohawk Power

Niagara Mohawk Power Corp. and Suncor Energy Inc. have made history with a groundbreaking greenhouse gas emissions trade that marks a significant step towards creating a global market and international trading system for reductions in emissions of greenhouse gases, such as carbon dioxide. The agreement has a potential value of $6 million and is a demonstration of a market-based approach to reducing greenhouse gas emissions. Suncor Energy has agreed to purchase 100,000 metric tons of greenhouse gas emission reductions from Niagara Mohawk with an option to buy up to an additional 10 million tons of reductions over a 10-year period.

Key Takeaways:

• Suncor Energy and Niagara Mohawk Power Corp. have formed a ground-breaking greenhouse gas emissions trade, with a potential value of $6 million.
• The agreement marks a significant step towards creating a global market and international trading system for reductions in emissions of greenhouse gases, such as carbon dioxide.
• Suncor Energy has agreed to make an initial purchase of 100,000 metric tons of greenhouse gas emission reductions from Niagara Mohawk with an option to buy up to an additional 10 million tons of reductions over a 10-year period.
• Nielsen Mohawk will reinvest a minimum of 70% of the net proceeds from the sale in new projects that will further reduce global concentrations of greenhouse gases in the atmosphere.
• Suncor Energy's agreement is part of the company's broad-based action plan to address the risk of global climate change, with a goal of managing its own greenhouse gas omissions and reducing emissions in the atmosphere.
• The agreement follows close on the heels of Suncor Energy's participation in a forest conservation program in Belize and its investment in the generation of wind power in Alberta.
• Niagara Mohawk has reduced its own greenhouse gas emissions significantly below 1990 levels through various means, including power-plant performance and energy-efficiency improvements.
• Emission reductions will be documented and deposited into an account administered by the Environmental Resources Trust, a non-profit environmental organization founded by the Environmental Defense Fund.

Statistics:

• Potential value of the greenhouse gas emissions trade: $6 million
• Initial purchase of greenhouse gas emission reductions: 100,000 metric tons
• Option to buy up to an additional 10 million tons of reductions over a 10-year period
• Minimum reinvestment by Nielsen Mohawk in new projects: 70% of net proceeds
• Number of customers served by Niagara Mohawk Power Corp.: 1.5 million (electricity) and 530,000 (natural gas)

Sources:

• "Niagara Mohawk Power Corp." press release, dated March 5, 1998
• "Suncor Energy Inc." press release, dated March 5, 1998