Information for CER buyers
How do I find good-quality CERs?
There are several ways for interested Buyers to find CERs from good-quality projects. At one end of the spectrum, Buyers may approach Sellers and form direct relationships to contract CERs in-house. This, however, involves costs in identifying suitable projects in many countries, and forming viable relationships over time, which typically require local presence and knowledge. At the other end of the spectrum, Buyers may invest in an aggregated fund which is tasked to procure CERs. The Buyer, however, has no direct link to an individual project, which is purchased on behalf of all contributors to the fund, and will most likely have to pay yearly management fees.
Using an experienced CER broker allows Buyers to receive current market updates, access to projects looking for Buyers, and assistance with term sheet and ERPA negotiations.
What are my responsibilities as a Buyer?
While Buyer responsibilities vary according to the terms and conditions of the Agreement, the following are typically executed by the Buyer.
- Obtaining approval from the Annex I country's DNA: This is to demonstrate voluntary participation from all Parties involved, and is usually obtained after approval by the host country. Approval may typically be sought from a DNA in any Annex I country where the Buyer has a branch, or is resident in. This allows Buyers to essentially choose from different DNAs which may charge varying levels of fees and times for approval. For example, the UK DNA requires two weeks for approval, while other countries may require two months.
- Design of the ERPA: The Buyer, if more experienced in CDM, is typically the Party which initiates writing the ERPA, based on the IETA ERPA Version 3. This is then amended by the Seller as part of ongoing negotiations.