"For us, joint implementation projects are of No. 1 importance because they channel investment into cutting emissions," Sharonov told representatives of foreign governments and institutions including the World Bank in Moscow.
Russia, the world's largest producer of greenhouse gases after the United States and China, "will not exceed its obligations" for carbon dioxide emissions under the Kyoto Protocol and will use the global accord's mechanisms to attract investment, Sharonov said.
The Kyoto Protocol requires its participating countries to cut their carbon emissions from 1990 levels by 5.2 percent by 2012. Russia ratified the accord in 2004, while the United States refused to ratify it, citing the cost to industries.
Russia could produce 300 million tons of carbon dioxide equivalent reduction units, a type of credit created under the Kyoto pact, between 2008 and 2012, Sharonov said. He added that the government has not established the limit for the number of these units at this time.
"Western companies can come in, increase environmental efficiency" of Russian enterprises "for relatively little money and sell the credits that would be created on external markets," Sharonov said on the sidelines of Friday's meeting. He also said that Russian companies are welcome to participate in such projects.
Cutting greenhouse gas emissions in Russia is less expensive than in countries that belong to the Organization for Economic Cooperation and Development because Russia is starting from a lower base, he said. Because of low energy efficiency and aging equipment, cutting a ton of emissions costs from $5 to $25 in Russia, compared with from $50 to $100 in the OECD countries, Sharonov said.
Companies that build projects to cut emissions can sell credits approved by a United Nations board, according to the Kyoto Protocol provisions, which came into force in February 2005.
Increasing energy efficiency, cutting emissions in the housing and utilities industries and decreasing methane gas leaks to improve the safety of mines are among Russia's top priorities for decreasing greenhouse gas emissions, Sharonov said.
Some 29 projects for improving the emissions standards at domestic companies have already been submitted to the Kyoto secretariat for approval, Sharonov said. The average cost of these projects is from 10 million euros ($13.3 million) to 50 million euros, he said.
"There is huge potential for improving energy efficiency in Russia and companies can reap substantial benefits" from this, said Pavel Teremetsky, business development manager at the energy efficiency department of the European Bank for Reconstruction and Development in Moscow.
"We are very interested in this market," Teremetsky said Friday, speaking after Sharonov's presentation.
The power industry accounts for a quarter of Russia's greenhouse gas emissions, Unified Energy Systems chief Anatoly Chubais told reporters Thursday. UES is seeking to raise $1 billion by selling emission credits gained from greenhouse gas reduction projects as coal-burning surges.
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