Enecore – an international carbon advisory firm – announces the launch of its innovative one-stop solution for helping investors resolving the growing number of commercial disputes under Emission Reduction Purchase Agreements (ERPAs).
The new product leverages on the expertise of Enecore’s technical and commercial teams along with seamless dispute resolution and climate law services, provided through a partnership with a top Legal 100 international law firm, to bring to the market a new and exciting integrated service aimed at helping project developers to level the playing field with their carbon credit buyers in order to maximize the value of their emission reduction projects.
The recent collapse of the carbon market has left thousands of investors in projects that reduce green-house-gas emissions - certified as CERs under the UN’s Clean Development Mechanism (CDM) - exposed to huge financial losses. These losses are estimated to be in excess of EUR 1.5 billion, with credit buyers increasingly requesting changes to the pre-agreed terms governing the purchase and sale of the credits.
The price of CERs has recently collapsed below 1 EUR/CER, triggering a market wide contract re-negotiation trend initiated by buyers with un hedged contracts for the purchase of CERs at prices between 8 to 12 EUR/CER for deliveries running up to 2020.
This new integrated service offers an immediate solution. The teams will assist project developers who invested in emission reduction projects that would have otherwise not been feasible without carbon price certainty. The average project developer stands to lose between EUR 2 to 3 million as a result of those renegotiation requests, with over 1,500 projects currently exposed to renegotiations.
The new service comes as a result of Enecore’s recent strategic shift from technical CDM project development, to a more focused provision of third party portfolio and commercial management solutions of carbon credit transactions.
Integrated legal services
In providing this service, Enecore works with a leading international dispute resolution and climate law firm with nearly 2,000 lawyers who practice on four continents. In addition to numerous specific recognitions of the firm's partners, practices, offices and markets, recent firmwide recognitions include UK publication Legal Business saying that the firm “has further cemented its position as the Global 100’s fastest growing firm” and in 2011 and 2012, Law360 included the firm within its “Global 20” as one of the “20 law firms with the greatest global reach and expertise.” The firm is also ranked as a leading firm in GAR 100 and Chambers Global – Climate Change Law.