New Multilateral Carbon Credit Fund transaction in Armenia

MCCF to purchase carbon credits from a group of ten small hydropower plants.

The EBRD-EIB Multilateral Carbon Credit Fund (MCCF) has agreed to buy carbon credits from a group of ten small hydropower plants in Armenia, bundled into a single project under the Clean Development Mechanism (CDM) framework.

The EBRD is working together with Ameriabank CJSC, one of the largest banks in Armenia with a leading position in Armenia’s energy financing, whose role is to aggregate the resulting emissions reduction units. In 2010 Ameriabank has completed the introduction and implementation of the Environmental and Social Management System.

With the support of the EBRD’s Armenian Renewable Energy Programme, under which the Bank provided $7 million to Ameriabank CJSC (legal successor of Cascade Bank CJSC) for on-lending to local Armenian companies, Ameriabank has financed the development of the hydropower stations participating in the transaction. Out of 149 small hydro power plants in Armenia, Ameriabank has financed 27 with a total capacity of around 60 megawatts.

Out of the ten mini hydro power stations participating in the transaction, seven are run-of-river plants and three plants are constructed on artificial water flows, each with electric capacity below 3.6 megawatts.

The plants are bundled into a single project under the CDM framework in order to enable them to benefit from the international emission trading market and reduce transaction and documentation costs. The MCCF, launched in December 2006 and sponsored by the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB), is one of the few carbon funds dedicated specifically to countries from Central Europe to Central Asia.

The transaction is in line with Armenia’s sustainable development goals and will help the country to increase its volumes of renewable energy. The project will also raise Armenia’s energy security by reducing its reliance on energy imports and improve the supply of electricity in rural areas where most of the plants are located.

The project contributes to global climate change abatement efforts, by offsetting more carbon-intensive electricity production from the Armenian electric grid.

The emission reduction purchase agreement (ERPA) for the sale and purchase of certified emission reductions (CERs) to be generated by the ten hydropower plants was signed between Ameriabank CJSC and Stichting Carbon Purchase Intermediary (CPI), a special purpose vehicle created to acquire carbon credits for the participants in the MCCF.

This ERPA is the second of its kind to be executed under the MCCF in Armenia and was negotiated by ICF Consulting Ltd., acting as Carbon Manager for MCCF in the Western-Balkan, Caucasus and Central Asia regions.

Background information:

The EIB is the European Union’s long-term lending bank, promoting European objectives. Established in 1958, it operates within the 27 EU Member States and in more than 130 countries outside the EU. One of the EIB’s priority objectives is protection and improvement of the environment and mitigation against climate change, which accounted for almost EUR 18bn of the EIB’s total lending activity in 2009. For further information visit: www.eib.org

The EBRD, owned by 61 countries and two intergovernmental institutions, is supporting the development of market economies and democracies in countries from Central Europe to Central Asia. www.ebrd.com

ICF Consulting Ltd., a subsidiary of ICF International (NASDAQ:ICFI) is a global professional services firm that partners with government and commercial clients to deliver consulting services and technology solutions in the fields of climate change, energy and power markets, and the environment. ICF Consulting Ltd. is Carbon Manager in MCCF’s South-East Zone, which covers Albania, Armenia, Azerbaijan, Bosnia Herzegovina, FYR Macedonia, Georgia, Kyrgyz Republic, Moldova, Mongolia, Montenegro, Serbia, Tajikistan, Turkmenistan, and Uzbekistan. Visit ICF at icfi.com.

Ameriabank CJSC is a corporate investment bank, which offers corporate, investment and limited number of retail banking services and provides a comprehensive package of banking solutions. The Chairman of the Board of Directors of Ameriabank is Mr. Ruben Vardanian. The Chairman of the Management Board – General Director is Mr. Artak Hanesyan. Strategic partner of Ameriabank is Troika Dialog Group, one of the largest Russian investment and banking companies. For further information visit: www.ameriabank.am.

Press contacts:

European Bank for Reconstruction and Development: Contact: Ina Coretchi, Tel.: +4420 7338 7874, Email: coretchi@ebrd.com, Website: www.ebrd.com