Kathmandu, January 7:

The Alternative Energy Promotion Centre (AEPC) has received a payment of $5,14,786 for its first delivery of verified emissions reductions to the Community Development Carbon Fund (CDCF) under the Clean Development Mechanism (CDM) created by Kyoto Protocol.

This payment is made for the Biogas Support Programme-Nepal Activity 1 Project deducting all costs as per emission reduction purchase agreement (ERPA), states a World Bank press release.

Verification of the Biogas Activity 2 has also been completed and AEPC is waiting for the payment for the second activity too. Nepal Biogas Project is one such project under the CDM. It is part of the Biogas Support Programme (BSP) that started in 1992, with Dutch support through the Netherlands Development Orgnisation (SNV). BSP also started getting funds from the German government through German Development Bank and the Nepal government through AEPC.

Biogas Sector Partnership Nepal (BSP-Nepal) assists AEPC in execution of BSP through its implementation. BSP promotes the use of biogas by expanding its use for cooking and lighting in rural households. The biogas units displace fuel sources traditionally used for cooking-fuel wood, ke-rosene and agricultural waste-with renewable biogas produced from treatment of animal and human waste. Each household biogas unit can red-uce almost five tonnes of carb-on dioxide equivalent, yearly.

"Many visionary Nepalis put in years of painstaking work to make this happen today," says Susan Goldmark, World Bank country director for Nepal. "They saw that clean environmental practices would eventually bring economic and social payoffs. In addition to renewable energy sources, hundreds of thousands of rural Nepalis also stand to gain from a wide range of associated benefits in the areas of health, sanitation and agriculture."

An emission reductions purchase agreement was signed by the CDCF managed by the World Bank and the AEPC in May of 2006 for sale of one million tonnes of Carbon Emissions Reductions. This payment represents the first of several annual payments, which will be based upon actual verified delivery of Emissions Reductions under the agreement.

"As we see by this payment, carbon finance can produce direct financial rewards while supporting sustainable development at the same time," says Jeremy Levin, Task Team leader for the World Bank, adding that the project produces significant local benefits to rural populace of Nepal through provision of modern, clean biogas energy while at the same time helps address the global issue of climate change."

As per the existing agreement, the funds shall be used to ensure proper implementation of current phase of the biogas programme and will also support implementation of future phases to reach additional households in the rural areas.

"We are happy in contributing reduction of greenhouse gas in the global atmosphere and contributing in the sustainable development of the country as well. As a result we have received the contracted payment from the World Bank for sale of our emissions reductions, and look forward to continued cooperation in the future," says Dr Govinda Raj Pokharel, executive director of AEPC. He emphasised that the ER payment received from the biogas CDM projects will be utilized in the promotion and sustainability of biogas sector.