VCC Carbon Overview July 2011

8/6/2019 VCC Carbon Overview July 2011

1/26

Eye on Carbon CreditsEye on Carbon Credits

Where Profits & Ethics Unite


2/26

The principal objective is to make capital returns from/investment in renewable clean energy verified emission. ,reduction credits To this end together with our partner

,provider we have made available to retail investors the,opportunity of purchasing high quality verified carbon

,credits which give investors direct exposure both to

global climate change policy and the price of carbon.credits

Investments in carbon credits resonate with three global,themes which are reducing poverty fighting climate change

.and promoting corporate social responsibility They provide

opportunities for investors to pursue those three,objectives simultaneously making the purchase of carboncredits attractive to investors at all levels who arelooking for sustainable investments that generate capital

.gain

hy invest in carbonhy invest in carboncredits?redits?


3/26

The market for carbon assets continues to be. ,attractive Our UK partner provider has the team,experience distribution and infrastructure to enableinvestors to access the global carbon markets and to

.build a valuable portfolio of carbon assets

Over the longer term the carbon market will benefit,from greater price transparency decreasing

,transaction costs and increasing liquidity all ofwhich will lead to increased efficiency in pricing and

.improvements in carbon reduction development Whilst

,carbon prices are currently volatile we believe thatover the medium to long term carbon credits provide anumber of attractive investment opportunities.

nvestment Rationalenvestment Rationale


4/26

Carbon credits are a SIPPCarbon credits are a SIPPapproved investmentapproved investment


5/26


6/26

The carbon credits that you purchase will be in your name on the. ,APX registry You are completely in control of these credits and

.can transfer them to any purchaser as you wish Our partner can.manage this for you if you would like

You can also ask them to act as your Agent to sell your carbon. - +credits on your behalf There is a one off fee of 99 VAT to list

%your credits for sale and 5 commission on the value of all carbon

.credits sold on your behalf for this service They have a number of relationships with carbon credit brokers and

,bulk buyers and are members of the Carbon Trade Exchange the APX,and Markit Registries with ongoing relationships with companies

globally who purchase carbon credits to offset their corporate. ,carbon footprints Together our aim is to aggregate your creditswith other clients holdings and offer these purchasers access to

.substantial blocks via the provider , In addition there is a unique Carbon Partner Program in place a,network of over 2 000 carbon credit ecommerce websites which the

,provider hosts enabling individuals and businesses around the.world to buy and sell carbon credits

Exit StrategiesExit Strategies


7/26

&arge Growing&arge Growing. . . . . . . .arket. . . . . . . .arket

Carbon will be theworld s biggest

,commodity marketand it could

become the world s

biggest marketover all

Barclays Capital

The global carbon market

is forecast to grow to $1trillion by 2013

(source: New Carbon Finance)


8/26

ignificant Internationalignificant InternationalPlayerslayers


9/26

Voluntary Carbon Market volumeVoluntary Carbon Market volumeforecasts are positiveforecasts are positive

New York Times: Carbon Trading is one of the fastest growing specialities in Financial Services.

Louis Redshaw, Barclays Capital:

Carbon will be the worlds biggest commodity market & it could become the worlds biggest market overall

CFCT Commissioner:

Carbon trading may dwarf that of crude oil within 5 years, worth 2 trillion

Fortune: JPMorgan isn't alone. All the big global investment banks including Barclays, Citigroup, Goldman Sachs

and Merrill Lynch are hurrying into carbon finance

Chris Leeds, Head of Emissions Trading, Merrill Lynch, London

Carbon could become one of the fastest growing markets ever, with volumes comparable to creditderivatives inside of a decade

Barclays PLC United Nations Carbon Credit prices may rise as much as 42% by 2012


10/26

Historic & ProjectedHistoric & ProjectedGrowth.....Growth.....


11/26

We provide you with access to purchase carboncredits which have the Verified Carbon Standard

.accreditation This ensures that carbon creditsbought by businesses and consumers can be

.trusted and have real environmental benefits The Verified Carbon Standard is among the most

widely used GHG accounting programs by projects

quantifying emission reductions and issuing GHG.credits in the voluntary markets More than 600projects have used the VCS Program to date to

reduce or remove more than 56 million metric- .tonnes of CO2 equivalent from the atmosphere

VCS has been used by projects on six continents toensure that every GHG credit they generate is

, , .verified permanent unique and traceable Thisprovides important quality assurance for thoseworking to curb GHG emissions on the ground even- .as top down climate regulations take shape

Read more about How VCS Works

What type of credits willWhat type of credits willyou be buying?you be buying?
http://www.v-c-s.org/how-it-workshttp://www.v-c-s.org/how-it-works


12/26

.Carbon emissions are a lead cause of climate change and global pollution You may,have heard a lot in the media these days about carbon emissions trading

, .carbon taxes and carbon credits Lobby groups and corporations spend millions, trying to sway consumers either way so let s break it

......downA - -ap and trade -system is already underway in the European Union where a cap

.has been set on how many emissions can be produced Allowances are given to, different companies via permits though they can sell them if they don t reach

.their pollution quota

arbon credits are bought voluntarily by companies and individuals tooffset the environmental cost of their actions which are typically measured by

,a verified third party and go towards funding projects in alternative energy, .developing renewable resources and other areas Climate Action sells these kinds

, , .of credits to individuals businesses and organizations

.Climate change poses a threat to the planet in our lifetime Consider the(impact of drought and flood on global food prices especially in developing

), ,countries the quality of air in cities like Beijing and Tokyo or melting ice. in the Arctic Investing in carbon credits won t magically stop climate

,change but it will direct financial resources towards projects that are.making incremental changes for the better

Carbon Credits OverviewCarbon Credits Overview


13/26

- .The voluntary carbon markets are inherently future facing Reducing greenhouse( ) .gases GHGs is an act designed with tomorrow s planet in mind Projects that,reduce GHG emissions can be years in the making and some will even outlive their

.stakeholders Carbon offset buyers commit millions of dollars every year to. -support the evolution of new technologies Suppliers generate pre compliance. ,credits before regulations set the rules Behind the scenes the voluntary

carbon market infrastructure sets the market trajectory with tools for, , .transparency accountability and expansion

,Transactions in the voluntary carbon markets are not required by regulation butare instead driven by companies and individuals that take responsibility for - offsetting their own emissions as well as entities that purchase pre compliance

. ,offsets What the voluntary carbon markets lack in size they make up for in , ,flexibility spinning off innovations in project finance monitoring and

.methodologies that also inform regulatory market mechanisms

Carbon credits can be voluntarily purchased in one of two ways through a

- - ( )formal exchange or on the decentralized over the counter OTC market where, .buyers and sellers engage directly through a broker or retail storefront

,Extract from State of the Voluntary Carbon Markets 2011 report EcoSystemsMarketplace

The Voluntary CarbonThe Voluntary CarbonMarketMarket


14/26

- -Because the voluntary carbon markets are not part of any mandatory cap and trade,system almost all carbon credits purchased voluntarily originate from emissions. , ,reduction projects These credits sourced specifically for the OTC market are

( ) ( ) generically referred to as Verified or Voluntary Emission Reductions VERs.or simply as carbon offsets

( )OTC buyers may also voluntarily purchase and in most cases retire allowancesfrom compliance markets like the Kyoto Protocol s Clean Development Mechanism

( ) ( ).CDM or the US Regional Greenhouse Gas Initiative RGGI - .The OTC market is driven by both purely voluntary and pre compliance buyers

Purely voluntary buyers purchase credits to offset their individual ororganization s emissions and are driven by ethical or corporate social

( ) . ,responsibility CSR motivations Hence the demand curve for these purely voluntary VERs has similarities with other citizen consumer ethical purchases

.such as Fair Trade or organic products - :Pre compliance buyers purchase VERs for one of two purposes to purchase credits

that they might be able to use for future compliance at a comparatively lowprice or to sell them at a higher price to entities regulated under a future- -mandatory cap and trade scheme

,Extract from State of the Voluntary Carbon Markets 2011 report EcoSystemsMarketplace

The Voluntary Carbon Market (cont)The Voluntary Carbon Market (cont)

e us ness ase or us a na ye us ness ase or us a na y


15/26

e us ness ase or us a na y e us ness ase or us a na y AvivaAviva: // . . / / / - - / - / -ttp www aviva com reports cr10 climate change environment controlling impacts carbon offsett// . . / / / - - / - / -ttp www aviva com reports cr10 climate change environment controlling impacts carbon offsett
http://www.aviva.com/reports/cr10/climate-change-environment/controlling-impacts/carbon-offsetting.html/http://www.aviva.com/reports/cr10/climate-change-environment/controlling-impacts/carbon-offsetting.html/http://www.aviva.com/reports/cr10/climate-change-environment/controlling-impacts/carbon-offsetting.html/http://www.aviva.com/reports/cr10/climate-change-environment/controlling-impacts/carbon-offsetting.html/http://www.aviva.com/reports/cr10/climate-change-environment/controlling-impacts/carbon-offsetting.html/


16/26

The Business Case for Sustainability The Business Case for Sustainability PumaPuma


17/26

GDF Suez Carbon Zero GasGDF Suez Carbon Zero Gas


18/26

Other well-known brands that buy carbonOther well-known brands that buy carboncreditscredits


19/26

ustralia sets carbon price at 15 per. . . . .onne

arket growth will also come from thearket growth will also come from themplementation of new international cap andmplementation of new international cap and. . . . . . . . .rade schemes. . . . . . . . .rade schemes

The Australian government has unveiledplans to impose a tax on carbon emissionsfor the worst polluters.

Prime Minister Julia Gillard said carbondioxide emissions would be taxed at A$23($25; 15) per tonne from 2012.

The country's biggest economic reform in ageneration will cover some 500 companies.

In 2015, a market-based trading schemewill be introduced


20/26

China to Launch Cap andChina to Launch Cap andTrade Scheme......Trade Scheme......

As a developing country, China does not shoulder legally binding responsibilities toreduce carbon emissions, according to the basic principle set by the UnitedNations Framework Convention on Climate Change.

Putting a price on carbon is a crucial step for the country to employ the market toreduce its rapidly growing carbon emissions and genuinely shift to a low-carboneconomy whilst remaining competitive in the global marketplace.

The country's first voluntary carbon trade was sealed in August 2010, with aShanghai-based auto insurance company buying more than 8,000 tons of carboncredits generated through a green commuting campaign during the BeijingOlympics.

The trade was carried out through the China Beijing Environment Exchange

http://www.bloomberg.com/news/2010-12-06/china-s-cap-and-trade-to-come-within-five-years-

Australias National Carbon OffsetAustralias National Carbon Offset
http://www.bloomberg.com/news/2010-12-06/china-s-cap-and-trade-to-come-within-five-years-professor-stern-predicts.htmlhttp://www.bloomberg.com/news/2010-12-06/china-s-cap-and-trade-to-come-within-five-years-professor-stern-predicts.html


21/26

Australias National Carbon OffsetAustralias National Carbon OffsetStandardStandard

A business may choose to gocarbon neutral for the

:following benefits

Reducing impact on globalwarming

Reputational or corporate

positioning Product positioningDifferentiation from market

(competitors or keeping up)with market leaders

Attracting and retaining staff Saving money through reducing

resource use and subsequentemissions reduction

Forming a greater understandingof the carbon risk associatedwith business operations/ and or product manufacture


22/26

usinesses are under pressure globallyusinesses are under pressure globallyo report their sustainabilityo report their sustainability. . . . . .nitiatives. . . . . .nitiatives


23/26

IndexIndex : / / . . / - / / / - .ttps www cdproject net en US Results pages leadership index aspx/ / . . / - / / / - .ttps www cdproject net en US Results pages leadership index aspx
https://www.cdproject.net/en-US/Results/pages/leadership-index.aspxhttps://www.cdproject.net/en-US/Results/pages/leadership-index.aspxhttps://www.cdproject.net/en-US/Results/pages/leadership-index.aspxhttps://www.cdproject.net/en-US/Results/pages/leadership-index.aspxhttps://www.cdproject.net/en-US/Results/pages/leadership-index.aspx


24/26

ConclusionConclusion , , With the team experience distribution and

,infrastructure in place with our partner providerwe believe this creates a unique opportunity to

enable investors to access the global carbonmarkets and to build a valuable portfolio of

.carbon assets Over the longer term the carbon market will,benefit from greater price transparency

decreasing transaction costs and increasing,liquidity all of which will lead to increasedefficiency in pricing and improvements in carbon

.reduction development We believe over the medium to long term carboncredits provide a number of attractive investment

opportunities


25/26

. .1 All investments are speculative and can fluctuate in value It should not be assumed that.the value of investments will always rise Past performance is not a reliable indicator of

.future results You may get back less than the amount originally invested or even lose the.full amount

.2 You should carefully consider in the light of your financial resources whether investing in.Carbon Credits is suitable for you

.3 Changes in currency exchange rates may adversely affect the value of any overseas.investments or investments denominated in a foreign currency

.4 There may be a big difference between the buying price and the selling price of Carbon. ,Credits If you have to sell them immediately you may get back much less than you paid for

.them You may have difficulty in selling Carbon Credits at the price you wish to achieve, ; .and in some circumstances it may be difficult to sell them at any price It can be.difficult to assess what would be a proper market price for these investments You should

not invest in Carbon Credits unless you have thought carefully about whether you can afford.to do so and have taken appropriate independent advice if you feel the need

. , ,5 Representations made by our sale consultants agents or sales literature either orally in.paper or electronic form do not form part of these Terms We give no warranty as to the

.future value of Carbon Credits . ,6 Forwards options and other derivative contracts in relation to Carbon Credits are regulated

. , ,investments in the United Kingdom However Carbon Credits sold by Baron Traders Ltd aka

, , .Validated Carbon Credits are not derivatives and as such are not regulated investments,Accordingly Baron Traders Ltd is not required to be regulated by the Financial Services( ) ( )Commission FSC or the Financial Services Authority FSA or any other regulator in the

. , ,United Kingdom or Gibraltar This means among other things that a person buying CarbonCredits from Baron Traders Ltd will not benefit from any protections afforded by the FSC or

FSA and would not have access to the Financial Services Ombudsman or the Financial Services.Compensation Scheme

Risk WarningRisk Warning


26/26

Where Profits & Ethics UniteWhere Profits & Ethics Unite

: + ( )el 44 0 203 137 4400+ ( )el 44 0 203 137 4400: .mail info@validatedcarboncredits com.mail info@validatedcarboncredits com:eb:eb . .ww validatedcarboncredits com.ww validatedcarboncredits com

alidated Carbon Credits is a trading name for Baron Traders Ltdalidated Carbon Credits is a trading name for Baron Traders Ltd.egistered in Gibraltar no 105368.egistered in Gibraltar no 105368
http://www.validatedcarboncredits.com/http://www.validatedcarboncredits.com/http://www.validatedcarboncredits.com/http://www.validatedcarboncredits.com/http://www.validatedcarboncredits.com/

Documents

VCC Carbon Overview July 2011