Company Information for Trading Emissions plc

AIM-TRE

www.tradingemissionsplc.com

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AIM; TRE

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Company Statement

Trading Emissions PLC was incorporated in the Isle of Man on 15 March 2005 for the purpose of investing in environmental and emissions assets.
Through a public offering and listing on the London Stock Exchange's Alternative Investment Market in April 2005, the Company raised £135m in capital. It is expected that the initial tranche of capital will be wholly invested by mid-2006.
The main investment objective is to make capital profits from purchasing emissions assets at appropriate prices. The core part of the portfolio is expected to be a long position in carbon assets, although some trading may take place. The Company also intends to invest in other selected emissions assets. In additions, the Company will seek to generate income from the provision of finance for selected programmes such as aggregation, monetisation, collateralisation and other innovative approaches to carbon trading markets.

Investment Assets
Trading Emission’s investments will be in a range of environmental instruments with a strong focus on the units produced by projects developed under the Clean Development Mechanism (CDM) and Joint Implementation (JI) of the Kyoto Protocol. Such projects can generate tradable carbon credits known as Certified Emission Reductions (CERs) in the case of CDM projects and Emissions Reduction Units (ERUs) in the case of JI projects.

CERs and ERUs can be used by companies to achieve compliance targets under Emissions Trading Schemes such as the EU ETS and by governments to meet commitments under the Kyoto Protocol. These units will be purchased on a forward contract basis, with payments made on delivery of the units.

Along with CERs and ERUs, Trading Emissions PLC is also acquiring rights to other tradable environmental commodities such as:

• Kyoto compliant units such as AAUs, t-CERs and l-CERs
• SOx credits from US Acid Rain Programme
• NOx credits from North American markets
• Carbon credits which qualify under the rules of the CCX

The Company is managed to be long only in environmental commodities with a view that these commodities will appreciate in value. The capital raised in the initial public offering is held with an AAA rated depository. As the Company allocates capital to emission reduction purchase agreements (ERPA) it enters into, project developers can be confident with the Company in meeting its ERPA commitments. Trading Emissions PLC is therefore a very strong counterparty in the market and its contracts can be used to leverage additional debt finance by project developers.
Trading Emissions PLC is an Isle of Man company with a board consisting of non-executive directors.
The board is advised by EEA Fund Management Limited an investment advisory firm based in the city of London.
EEA is also advisor to Climate Exchange PLC, an investment company listed on AIM. Climate Exchange PLC is the financing vehicle for the Chicago Climate Exchange and the European Climate Exchange.

Along with its investment advisors, the company can also call on the advisory panel to provide advice on key policy developments and assist in the origination of deals.

Operations and Technology

PROJECT INVESTMENT CRITERIA

Trading Emissions PLC (TEP) is a diverse fund investing in a range of tradable environmental commodities. Of these, our portfolio of CERs and ERUs is likely to dominate. Our portfolio will be managed to ensure diversification in terms of technology, sector and geography.

SIZE
The preferred project size is at least 50,000 tonnes of CO2 equivalent per year, with no maximum size. We can contract for bundled, small-scale projects.

TECHNOLOGY
Projects expecting to use both new and more conventional technologies to reduce any of the six greenhouse gases listed in the Kyoto Protocol - CO2, CH4, N2O, HFCs, PFCs and SF6.

SECTOR
Renewable energy, industrial processes, waste gas utilisation, energy efficiency, biofuels, transport, and to a lesser extent land use change and forestry.

GEOGRAPHY
TEP is actively seeking emission reduction projects worldwide including Least Developed Countries and small island states.

START DATE
Projects that have started or plan to start operation during the next 3-4 years. We prioritise the purchase of carbon assets created prior to and during the first Kyoto commitment period (up to 2012), including “early credits” from Joint Implementation projects.

STAGE OF PROJECT DEVELOPMENT
We are interested to hear from developers and other entities working on projects at all stages of development, particularly those that aim to incorporate carbon finance into the financing of their underlying project. We do not need to see completed project documentation before discussing possible contracting structures.

LEVERAGE
We will work with the developer to take advantage of the TEP's balance sheet through development of contracting structures that have a bankable role in the overall project finance package.

ADVISORS
We can work with project developers that have already appointed a consultant to develop CDM/JI project documentation. We are well positioned and keen to assist project developers in successful completion of the CDM/JI project development process (documentation, registration, etc) as part of any transaction we enter into.

INVESTMENT TIMING
We aim to have fully invested the initial capital (£135m) by June 2006.

PARTNER ENTITY
We are interested to hear from project developers, project aggregators, advisors and promoters.

TRANSACTION COSTS
We may advance a loan to cover the costs of CDM/JI project development and documentation on a case by case basis. We will work transparently with project developers and will not impose administration costs or transaction fees.

Board of Directors and Key Management

Neil Eckert	Chairman
Nigel Wood	Non-executive director/ Chair of Audit Committee

Philip Scales	Non-executive director/ Member Audit Committee

Malcolm Gillies	Non-executive director/ Member Audit Committee

Bertrand Rassool	Non-executive director

Company Address

Third FloorExchange House
54-62 Athol Street
Douglass, Isle of Man, United Kingdom IM1 1JD


Telephone:	020 7553 2362
Email:	info[at]tradingemissionsplc.com
Website:	http://www.tradingemissionsplc.com

Additional Address/Key Contact

INVESTMENT ADVISOR
EEA Fund Management Limited
7th Floor
22 Billiter Street
London
EC3M 2RY

Capital

135,000,000 1p ordinary shares

Nominated Advisors

Cenkos Securities

Most Recent Statement

04/09/07 - Holding(s) in Company
20/08/07 - Majority stake in KWTE
05/08/07 - Trading Statement
01/08/07 - Investment in Biodiesel Plant

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