LONDON: Hungary has sold the first Removal Units (RMUs), a new type of Kyoto Protocol currency, two sources close to the deal confirmed, as the government seeks to diversify its carbon sales at a time of waning global demand for other types of emissions permits.
The two sources, speaking on condition of anonymity, would not give further details of the transaction, including the identity of the buyer, the quantity of RMUs sold or the price paid.
"An RMU deal went through last month involving (Hungarian RMUs and) several buyers," one source close to the Hungarian government said.
"Any of these details would give an indication to other deals being negotiated and we don't want that when the first deals emerge," said the other source, a facilitator to the deal.
Officials with Hungary's Ministry of National Development, the government unit in charge of Kyoto credit sales, were unable to confirm the RMU deal and the press department did not reply to emailed questions by the time of writing.
In October, Hungary said it had up to 3.9 million RMUs for sale, each equivalent to one tonne of carbon dioxide and issued as a reward for growing forests and increasing the amount of CO2 stored in them.
RMUs are alternatives to Assigned Amount Units (AAUs) and Certified Emission Reductions (CERs), carbon credits created by cutting CO2 under the Kyoto Protocol, and can also be used to meet emissions goals under the 1997 pact.
Hungary's forests now cover around a fifth of the country after its forested area grew 13 percent to 19,217 square kilometres between 1990 and 2011, data by the Hungarian Statistic Office showed.
As a result, Hungary issued itself the first RMUs earlier this year after the UN finalised the country's 2008 greenhouse gas emissions data late last year.
The country, along with Denmark, France and Switzerland, has opted to use a special emissions accounting method that allows it to print RMUs annually.
Other Kyoto signatories, using standard accounting methods, will receive RMUs in 2014, two years after emissions data for the entire 2008-2012 Kyoto period is finalised.
A state secretary last week told a press briefing in Budapest that Hungary has made HUF 2.7 billion ($11.5 million) in revenue this year from selling "Kyoto permits", and that it expects further HUF 1.6 billion next year.
All revenue will go to insulating buildings and funding environmentally-friendly transport initiatives, Janos Bencsik said, as reported by online news portal Energiainfo.
Between 2008 and 2010, Hungary has raised HUF38 billion ($162 million) by selling 11.6 million AAUs to Belgium, Spain and a Japanese company as well as 0.8 million CERs to a Hungarian firm, according to Point Carbon News data.
Despite being an active AAU seller in 2008 and 2009, Budapest has not inked any further deals in the past 18 months due to both increased competition from other countries, namely former Soviet bloc nations that have vast AAU inventories, and dampened demand from the global economic slowdown.
Credit buyers may also be avoiding Hungary after it sold around 800,000 previously-surrendered CERs in 2010.
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