Carbon Credits and Wind Power

Wind power generates CO₂-free electricity and so it can also generate ‘carbon credits’ attached to each delivered kWh. If an environmental derivative market is available, the profitability of a wind power project will result from selling electricity to the energy market and also from selling ‘carbon credits’ on such a derivative market. And this will be more and more possible as the Kyoto Protocol and its attached main ‘flexibility mechanism’ the Clean Development Mechanism (CDM) enter into force in 2005 together with the European Trading System (ETS). This article describes  a simple and reliable method to assess the increase in profitability by selling carbon credits.