The multilateral carbon credit fund of the European Bank for Reconstruction and Development (E.B.R.D.) will purchase carbon credits from a Ukrainian food fats producer.

The fund will purchase the carbon credits from a plant of the Creative Group Holding between this year and 2012.

The project is under the E.B.R.D.’s Ukraine energy efficiency program framework, which allows Ukrainian companies to benefit from a carbon finance transaction while employing environmentally friendly technology.

The carbon deal is implemented through a 14.3 million euro ($20.3 million) loan to the Moldova microlending framework jointly financed by the State Export - Import Bank of Ukraine and the E.B.R.D. through the Ukrainian program.

The microlending framework is a $25 million facility that will provide on-lending funds to leading Moldovan banks and other microfinance institutions, allowing the E.B.R.D. to expand outreach to creditworthy micro and small enterprises.

The project involves the construction of a new oil extraction facility with combined heat and power units that will use sunflower seed husk as fuel. Aside from lowering consumption of natural gas and electric power, the project will reduce over 100,000 tons of carbon dioxide emissions by 2012.

The project will also reduce methane emissions as it will use the seed husks, which would have otherwise been dumped in a landfill.

The carbon credits are to be generated via the Joint Implementation scheme under the Kyoto Protocol, a market-based approach for addressing global climate change that uses international partnerships to achieve low-cost reductions in greenhouse gases.

The carbon credit fund was launched in December 2006 and is sponsored by E.B.R.D. and the European Investment Bank. It is one of the few carbon funds dedicated specifically to countries from Central Europe to Central Asia.