Market News

 August 16, 2007
Morgan Stanley, DNV Launch Carbon Bank

 LONDON, UK -- Morgan Stanley will partner with Det Norske Veritas (DNV) to help clients become carbon neutral, the companies announced Tuesday.

The Morgan Stanley Carbon Bank will offer integrated carbon verification and offsetting services, helping clients take an emissions inventory and determine their carbon footprint using the Greenhouse Gas Protocol Initiative.

"Many companies have begun seeking ways to reduce their direct greenhouse gas emissions. Our new service will help them more easily and reliably take the next step to achieve a zero carbon footprint," said Simon Greenshields, managing director and global head of power, power fuels and carbon trading at Morgan Stanley, in a statement. "This is the first service we have seen giving clients a single source for everything from certifying emissions to buying and canceling carbon credits, all in accordance with the highest international standards."

DNV, an international provider of emissions data certification, will verify the inventories and footprints.

"Our highly trained professionals have provided expertise in greenhouse gas verification and certification to a wide variety of companies, governments and international organizations worldwide," said Luc Larmuseau, DNV's global director of climate change services. "We serve companies across the carbon market, from checking the number of emission reductions delivered by projects under the Kyoto Protocol to verifying companies' annual greenhouse gas emissions under mandatory emissions trading programs."

Clients can choose the carbon credit sources, which will be purchased by Morgan Stanley's Commodities Group. Some of the carbon credits could come from Morgan Stanley's own investments in emission reductions or from MGM International, an emissions reduction project developer in which Morgan Stanley owns a 38 percent stake.

David Yarnold, Environmental Defense's executive vice president, called the announcement a reinforcement of the need to use market-based solutions to battle climate change.

"Although the regulated carbon market is based on environmentally effective and standardized procedures, it has been difficult for companies to find a high-quality, standards-based service to offset their emissions in the voluntary market," he said. "By offering this new service to companies in the voluntary carbon market, Morgan Stanley is not only helping to meet a growing need for many companies, it also is supporting a significant, credible and responsible expansion of the carbon market itself."

Morgan Stanley plans to spend $3 billion on initiatives related to greenhouse gas emission reductions during the next five years. It has committed to reducing greenhouse gas emissions by between 7 percent and 10 percent below 2006 levels by 2012 through energy efficiency and new green buildings. It plans on becoming carbon neutral by 2008 by using carbon offsets to neutralize emissions from office operations and employee business travel.