Oriental Energy and Power Generation Corporation is eyeing to trade the carbon emissions reduction that will be generated from its five mini-hydro power projects to bring it more cash value.

The company already inked a deal with Carbonergy Business Consultancy Services, a Philippine-registered company, to develop a program that shall enable it to trade its carbon credits under the Clean Development Mechanism (CDM) of the United Nations Framework Convention on Climate Change (UNFCCC), currently underpinned by the Kyoto Protocol.

Carbonergy, it was noted, sets collaborative efforts with international consortium of energy and CDM experts on trading carbon credits. It counts Swedish Energy Agency and the World Bank among core clients; and has done CDM-related works in Kenya, Tanzania, and Mongolia.

For the Oriental hydro projects, it will be in-charge of handling all the CDM-related dealings of the company, together with its partner in the initiative, PhilCarbon.

Beyond 2012 though when the Kyoto treaty lapses, paradigm shifts may be experienced in the trading of carbon emissions reduction depending on the subsequent binding agreement that will be reached by global policy framers.

In the case of Oriental Energy’s hydro projects that will yield a total of 50 megawatts capacity, its initial target on trading its CERs will be 2014 or upon completion of two of its programmed projects.

“Oriental currently has five (5) projects ...that will result in an estimated 50MW installed capacity of new and renewable energy for the grid in different locations of the country. The first two of these projects are expected to be operational by 2014,” the company said.

These mini-hydro projects have been part of the service contracts awarded to the company by the Department of Energy.

Given the timeframe of the project’s completion, it is expected that the CER trading arrangement being eyed by the project sponsors will largely be anchored on the post-Kyoto treaty that must be reached for future CDM initiatives.

Apart from the potential for carbon trading, such projects mainly designed as run-of-river hydros, are also eligible for incentives under the Renewable Energy Law, including the feed-in-tariff which shall eventually be enforced for such resource.

The flurry of RE projects is expected upon the implementation of the FIT Allowance incentive for emerging RE technologies which will then be passed on as separate charge item in the electric bills.