Caixa Econômica Federal Solid Waste Management and Carbon Finance Project
Caixa was registered with the United Nations (UN) for the Clean Development Mechanism (CDM) activity program focused on municipal solid waste management, namely “Caixa Econômica Federal Solid Waste Management and Carbon Finance Project”
Caixa was registered with the United Nations (UN) for the Clean Development Mechanism (CDM) activity program focused on municipal solid waste management, namely “Caixa Econômica Federal Solid Waste Management and Carbon Finance Project”.
The program aims to implement both medium and long-term innovative actions having the potential to leverage a large volume of projects for the implantation of sanitary landfills and the adoption of CDM in a single program, coordinated by Caixa.
The CDM activity program focused on municipal solid waste management had the Santa Rosa Waste Treatment Center (WTC) as its first project. Located in the Municipality of Seropédica, the Santa Rosa WTC is South America’s largest sanitary landfill, which will receive waste from the metropolitan area of the City of Rio de Janeiro. The agreement, which totals nearly
USD 200 million, was entered into with Saneamento e Energia Renovável do Brasil S/A (SERB), a Brazilian sanitation and renewable energy company. The program will last 28 years, during which new projects can be integrated. Such projects will be automatically registered after validation by the operational entity designated by the United Nations upon meeting the program’s eligibility criteria. Both the public and private sector can propose new projects, which enhances the program’s scope.
Caixa, in its role as coordinator, will be responsible for the program implementation and management jointly with the United Nations and the World Bank – IBRD. Caixa will also be responsible for the management of projects which will be monitored according to the guidelines established in the Caixa Social-Environmental Milestone – Municipal Solid Waste and CDM, developed within the scope of the Caixa/IRDB partnership, which internalized IBRD’s social-environmental safeguards into Caixa’s rules.
Under the Kyoto Protocol rules regarding registration of clean development mechanisms, the following must be accomplished: i) approval in compliance with Brazilian rules, under the responsibility of the Brazilian Global Climate Change Interministry Commission; ii) international validation by an institution designated by the United Nations; and iii) period of international consultation. After complying with such requirements, Caixa successfully achieved CDM registration for the Santa Rosa WTC, which did not result in any contrary manifestation.
Caixa is the only bank in Brazil to offer financial solutions for compliance with a government policy for solid waste, eradication of waste dumps and implementation of sanitary landfills, jointly with carbon credits. As accessory guarantee, the credits establish a new business model which links the decrease in the financing rate to the deliver of carbon credit generated by the project financed. The Santa Rosa WTC is expected to generate 6 million tons of Certified Emission Reductions (CERs). Caixa has already contracted 2.357 million tons with Carbon Partnership Facility when entering the global carbon market.
Such an initiative grants Caixa pioneering, forefront position for its effective contribution to Brazil by making efforts to mitigate and fight climate change effects. The subject is highly important in nations’ agenda and it has been purpose of various international agreements.