The China CDM Fund plans to invest 4 billion yuan ($645 million) annually over the next three years in projects that cut carbon emissions, its deputy director said in an interview.

The public-private partnership fund under the Ministry of Finance will step up its activities in order to deploy a larger share of its financial capital, Jiao Xiaoping, the fund’s deputy director, told China Financial and Economic News.

The China CDM Fund was originally funded by levies paid by CDM project developers that sold CERs to European and Japanese buyers.

Although the revenue flow from that source has more or less come to a halt, the fund plans to raise its activity levels, Jiao said in the interview, which was republished on the finance ministry’s website.

So far, it has invested or lent 10.6 billion yuan into 168 projects across 23 provinces, cutting CO2 emissions 47.8 million tonnes a year and unlocking 49.1 billion yuan worth of private capital in the process, he said.

Among the projects it has part-funded is the second tranche of the West-East Gas Pipeline, a $20 billion, 9,100 kilometre gas pipeline running from Xinjiang to Guangdong, which owner PetroChina says will cut emissions by 129 million tonnes of CO2 year.

The fund invested 68 million yuan in the project, according to Jiao.

It has also taken a 50 million yuan ownership stake in the Shanghai Energy and Environment Exchange, which hosts carbon permit trading under the Shanghai ETS.

By Stian Reklev – stian@carbon-pulse.com