In line with the Clean Development Mechanism (CDM) proviso of the Kyoto Protocol, facility owner SN Aboitiz Power Inc. (SNAP) clinches the first major milestone that can bring its 75-megawatt Ambuklao hydropower plant closer into registration prospects for carbon trading.

SN Power recently secured the letter of approval from the Department of Environment and Natural Resources (DENR) for its CDM enlistment. Basically, the CDM approval bestowed by a designated national authority, which in the Philippines case would be the DENR, serves as a major condition before any project can register for carbon trading.

SNAP external relations manager Mike Hosillos explained that the host country approval “is a significant milestone as it is a condition to the rigorous application process for registration and eventual issuance of letter of approval (for registration) under the CDM.” SN Power first hurdled the CDM letter of approval for its 100-MW Binga hydro plant last year.

The CER credit potential of the Ambuklao facility is seen yielding 155,000 tons annually, which may stretch for seven years during the initial crediting period. For the Binga plant, CER credits may reach 23,000 over the same timeframe.

Norwegian firm SN Power, in particular, is no stranger to CDM accreditation and on trading for certificates for carbon emissions reduction (CER) – since European countries have been among those actively involved in carbon trading schemes crystallized under the CDM initiative of the United Nations Framework Convention on Climate Change.

SN Power Philippines country director Kim J. Lande intimated that “SNAP’s voluntary participation in the CDM shows our strong commitment to social and environmental sustainability throughout our business.”

The ‘beyond-business-as-usual’ requirement for CDM initiative is reportedly met since the one set for enlistment would be the capacity from the plant’s rehabilitation, which in a way will contribute to the country’s overall effort at reducing its carbon foot prints.

SNAP chief executive officer Emmanuel V. Rubio noted that the environment department’s approval will “significantly mark the company’s contribution to displacing fossil-based fuel in the market starting 2010.”

The company added “the approval means the projects met the national criteria for sustainable development and that SNAP possesses the legal capacity to participate in the CDM project activity.”

Upon completion, the combined capacity of the Ambuklao and Binga hydro plants will be shored up to aggregate 225 MW from 175 MW presently. The Ambuklao plant’s rehab is targeted for completion end this year and will consequently increase its capacity to 105 MW while Binga’s will be jacked up to 120 MW.