The Nordic Environment Finance Corporation announced that its Carbon Fund has signed Agreements to procure emission reductions from a wind energy project in Jiangsu province, and a small hydro-electric project in southwest China. The projects will be implemented under the Kyoto Protocol's Clean Development Mechanism. These are NEFCO's first projects in China.

The first CDM project is developed by the Chinese renewable energy company, the Yangtze New Energy Development Co. and will consist of installation of 134 wind turbines, each with a capacity of 1.5 MW. Under the transaction, the NeCF is expected to purchase about 1.4 million certified emission reductions. The renewable energy produced will displace a mix of fossil fuel-fired power generation from the East China grid.

The second transaction is a small hydro-electric project located in south west China, which is expected to generate around 250,000 CERs.

"These inaugural investments are an important milestone for the NEFCO Carbon Fund, coming only a few months after its founding. Moreover, by investing in wind power and small hydro, this emphasizes our commitment to the promotion of high-quality, clean energy projects within our portfolio," said NeCF Fund Manager Ash Sharma. NeCF is evaluating a number of deals in the area of renewable energy and energy efficiency in China, India and south east Asia.

China is now the world's fastest growing wind energy market, with an average annual growth rate of 56% in the past seven years. China has now reached the fifth place for installed wind energy capacity, with over 6 GW at the end of 2007. The Chinese Renewable Energy Industry Association forecasts a capacity of around 50 GW by 2015.