A collaborative carbon credit financing chain is enabling residents of Ulaanbaatar, one of the world's most polluted cities, to make energy-efficiency improvements in their own homes.
It's a three-step process designed by Citi, Microenergy Credits and Mongolia’s XacBank. XacBank provides microloans for households to purchase energy-efficient stoves or home insulation products (like heat-trapping blankets that cover a yurt). This will save energy, which Xacbank customers can resell to Citi using the Microenergy Credits platform. Citi is committed to purchasing 1.17 million tonnes of carbon credits over the next seven years. This can only be good news for Ulaanbaatar residents, who will be able to use the loans to improve their lives, save money and further reduce their carbon emissions.
Bob Annibale, Global Director of Citi Microfinance and Community Development explains that the program:
…connects and values energy saved at the household level with global emission reduction targets and markets…It is a great example of using creative microfinancing to address client and community needs, and a model that can be applied in other initiatives and countries.
Editors note: Mercy Corps co-founded the microfinance bank, Xacbank in 2001. The bank aims to contribute to sustainable development in Mongolia through its triple bottom line focus on “planet, people and profit”.