1. Environmental Industries Sector Unit CDM Opportunities in South Korea Greg Dunne, Director, ICECAP Ltd. Seoul, 25 th September 2006 EISU Seminar Mission South Korea

2. Environmental Industries Sector Unit UK – A Climate Change Leader Contributor to the Scientific Debate Ratified the Kyoto Protocol – 12.5% Target Policy is to Significantly Outperform Kyoto Targets – 15-18% (60% by 2050) UK Emissions Trading Scheme preceded European Emissions Trading Scheme Strict National Allocation Plans Aggressive Renewable Energy Targets International Dialogue at EU, UNFCCC and G8 Promoter and Supporter of Clean Energy Technologies EISU Seminar Mission South Korea

3. Environmental Industries Sector Unit London – Centre for Emissions Trading Traders: Utilities, Financial Institutions & Hedge Funds Brokers: All Major Emissions Brokers have Desks in London Exchanges: European Climate Exchange (ECX) based in London Funds: Most Carbon Funds Managed in London IPOs: Several Listings of Carbon Market Service Providers Project Finance: Major Provider to the Developing World Service Providers: Global Environmental Consultants & Audit Firms EISU Seminar Mission South Korea

4. Environmental Industries Sector Unit The Clean Development Mechanism (CDM) GHG Projects are ‘normal’ projects, which lead to a reduction of greenhouse gas emissions and are eligible for tradable emission reduction credits Implement a GHG emission reduction project in one country, and claim the emission reductions in another Additional value (‘carbon finance’) to projects which reduce GHG gases, because of the opportunity to sell this reduction Emissions reductions are achieved at lowest cost Legal Framework: UNFCCC, Kyoto Protocol & European Linking Directive Project Types: Renewable Energy; Fuel Switching; Reduced Industrial Process Emissions; Management of Biodegradable Waste; Capture of Waste Gases for Destruction, Conversion or Reuse EISU Seminar Mission South Korea

5. Environmental Industries Sector Unit CDM Benefits Annex A Countries Meet Kyoto Targets at Least Cost Developing Countries Benefit from Technological Transfer and Innovation, Higher Foreign Direct Investment, Capacity Building and Sustainable Development Investment Capital Generated from a Wider Pool of Investors Transforms Unviable Projects Creating New Opportunities Early Access to a Wider Range of Technology Solutions Reputational Benefits EISU Seminar Mission South Korea

6. Environmental Industries Sector Unit CDM Market Developments Market is complex, illiquid and risky … but growing rapidly (at least 1 billion tonnes in the pipeline*) Buyers are Annex A governments, multilateral development banks, carbon funds and private sector entities mostly from Europe but also Japan Sellers are mostly in China, India, Brazil & South Korea Most trading in CERs is on a forward basis – spot market unlikely until the international registry in 2007 Trading is OTC and mostly on a principal to principal basis so price discovery is limited CERs trade on a stand alone basis or at a discount to EUAs – prices are moderating as supply exceeds demand * Source: UNFCCC EISU Seminar Mission South Korea

7. Environmental Industries Sector Unit ICECAP ICECAP Founded in 2003 and Incorporated in the UK ICECAP Trading: one of the largest private sector buyers of CERs in 2005 ICECAP Launched the ICECAP Carbon Portfolio in January 2006 with Investment Grade Rated Participants and Substantial Demand for CERs ICECAP Team Specialises in Commercialising Carbon Assets ICECAP Committed to the Asian Carbon Markets – Office in China and Transaction History in China, India and South Korea EISU Seminar Mission South Korea

8. Environmental Industries Sector Unit ICECAP – Benefits for Sellers Principal-to-Principal Relationship Aggregation Ability allows Rapid Access to a Huge Market Innovative Pricing Mechanisms with Focus on Sharing of Risk & Rewards Appreciation of Sellers’ Delivery Risk Concerns No Restrictive Investment Criteria Credit Enhancement Transaction Risk Management Flexibility, Support and an Experienced Professional Team Track Record and Good Relationships in Asia EISU Seminar Mission South Korea

9. Environmental Industries Sector Unit ICECAP Ltd Asia Li Xing +86 139 250 19819 lixing@icecapltd.com Suite 2201, Building no. 14 Jianwai SOHO, Beijing 100022 China T: +86 105 869 9062 Europe Greg Dunne +44 (0)7768 791028 greg@icecapltd.com 5-8 The Sanctuary, London SW1P 3JS, United Kingdom T: +44 (0)20 7341 0910 www.icecapltd.comlixing@icecapltd.comgreg@icecapltd.com www.icecapltd.com EISU Seminar Mission South Korea