WorldBank – Letter of Intent – For Carbon Credits from FaL-G Brick Activity

World Bank has issued a Letter of Intent for the purchase of 800,000 tons of carbon credits from the FaL-G brick and block industry @ US$ 5/ton of CO2eq. A Letter of Intent was signed to this effect by Mr. Ken Newcombe, PCF Fund Manager & Sr. Manager: Carbon Finance Business, World Bank, and Kalidas, Director, INSWAREB at Washington on 3rd instant.

N Kalidas, Director: INSWAREB shaking hands with Ken Newcombe, PCF Fund Manager & Sr.Manager: Carbon Finance Business, World Bank, after signing the LOI for selling carbon credits out of FaL-G brick plants. Dr Bhanumathidas, Director General: INSWAREB smiling the celebrations.

INSWAREB has been spearheading this cause for the last four years that has been culminated to a stage of implementation where the business begins now. FaL-G bricks and blocks do not need any thermal energy whereas the traditional walling product, clay bricks, consumes over 200 tons of coal per every million bricks of output. Thus FaL-G is well qualified as emission-abating project to receive the benefits of carbon credits.

INSWAREB shall bundle over 300 licenced plants of FaL-G brick production and transfers the credits to World Bank over next ten years. For this purpose INSWAREB has drawn a monitoring and verification mechanism that would be invoked through strict audit procedures. The earnings of these credits would go to the micro units in pro-rata to their annual output. To accomplish this task successfully the tiny entrepreneurs would be facilitated with project loans and working capital, the repayment of which would be considerably taken care by the carbon credits. Thus the entrepreneurs virtually get the funds free if they perform well both in production and sales. INSWAREB has catalyzed a commercial organization, Eco-Carbon Pvt. Ltd., who functions as the project sponsors to coordinate all the commercial activities of this bundling program.

As envisaged by INSWAREB for its macro level program, the outcome of this project would spin off to enthuse more and more entrepreneurs for the proliferation of numerous units throughout the country so that the National environmental agenda to conserve topsoil on one hand and utilize fly ash on the other would be accomplished. INSWAREB’s projections show 80 million tons of carbon credits in byproduct utilization for building materials alone; and this is a beginning of this massive task envisioned by INSWAREB, as optimistically observed by a spokesman of the World Bank.

When World Bank did show its interest in the year 2000 for similar deal under Prototype Carbon Fund (PCF), INSWAREB could not avail the offer, as matters were not conducive at home front where India was reluctant to sign the Kyoto Protocol. The issue was reopened at Delhi in 2002 at COP-8, where World Bank introduced the new funding package of US $100 millions under Community Development Carbon Fund (CDCF).

After extensive evaluation and an in-depth study, World Bank observed the FaL-G brick activity as the fittest and unique model for compliance to the multiple indicators of community development such as employment generation, rehabilitating the artisans of clay brick industry with year-long livelihood, entrepreneurial development, abatement of topsoil erosion, utilization of industrial byproducts for ecological welfare, energy conservation etc., which all, in turn, serve the causes of global agenda, The Sustainable Development.

The technology is in great demand from various state governments who are laden with the responsibility to promote fly ash utilization. At the invitation of Punjab Government, INSWAREB is engaged in drawing a state level program to enthuse local ‘Bhattawalas’ (clay brick kiln owners) in taking up fly ash brick activity. Carbon credits would prove a great opportunity to all the states to tide over their resource crunch if they translate their industrial programs into CDM projects to the available extent