Govt. blocks carbon credit trading

The government has reportedly halted progress on establishing a carbon credit trading system, effectively preventing private sector entities from participating in such trades.

FRED Member Parakrama Jayasinghe revealed that the government has stalled the processes necessary for carbon credit trading, which could generate significant foreign exchange revenue for the country. 

“We have observed a standstill in this area for the past few months. Developing carbon credits is a complex undertaking,” he noted.

Furthermore, a new clause introduced in Standardised Power Purchase Agreements (SPPAs) prohibits renewable energy developers from entering carbon credit sales agreements with third parties. This effectively strips developers of any ownership rights to carbon credits generated from their renewable energy resources.

“It is illogical to expect developers to generate carbon credits only for them to be transferred to the government,” Jayasinghe noted. “This issue requires a broader national perspective and should not be confined to the purview of the Ministry of Energy or the CEB. It is a national concern.” (NF)