Last Updated February 21, 2008
Japan's Nippon Export and Investment Insurance (Nexi) is providing cover for a project in Indonesia aimed at reducing greenhouse gas emissions. The insurer is extending its overseas untied loan insurance to a financing package arranged by Sumitomo Corporation for PT Budi Acid Jaya (BAJ), the largest tapioca starch producer in Indonesia.
The purpose of the project is to capture methane gas from tapioca starch wastes that are produced from three of the company's tapioca plants, and then use the by-product to generate power.
The project is being carried out under the Clean Development Mechanism (CDM) scheme, a scheme set up under the Kyoto Protocol that allows industrialised countries to invest in projects aimed at reducing emissions in the emerging markets.
Through this particular project, Japanese companies will be able to obtain certified emission reductions (CERs) by purchasing emission credits from Sumitomo Corporation. This deal marks the first time Nexi has provided cover for a project where Japanese firms can purchase CERs.
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