Design Of EPC Project Financing Model Which Combines Carbon Dioxide Emissions Trading

In china financial problem is the main factor which constraints the development of EPC industry for a long time. Owned fund and credit from the finance institutions are two main capital sources in the existing financial model of EPC. Now the world is in the era of low carbon economy. GHG (greenhouse gas) emission trading scheme and related market is being mature gradually and it also achieved initial development in china. Carbon dioxide emission has become a valuable intangible commodity. Most EPC projects also have effect of emission reduction. This thesis wants to use the emission reduction effect of EPC and carbon emission trading to construct a new financing model of EPC which contains emission trading. The aim is that it can broaden the financing channels and help to solve the financial problem of EPC.First thesis introduces the concept of EPC and the existing common financing model of EPC project and researches main obstacles of EPC's development in China. The core of them is financing problem. This thesis analyses the reason of it and considers that through exploring the potential of EPC and its operating process to create new financing source is more important. The second part is the research on CO2 emission trading including the legal and trading mechanism of it. This part includes studies on the GHG emission trading scheme of Europe and USA. I summary and analyse the development status of it in China. Through the research above thesis finds the juncture of EPC and GHG emission trading. Base on it I design the EPC financing model which combines the carbon emission trading and use flow chart to illustrate it. In this process I find evaluate the value and price of carbon emissions is very important, so I use real option pricing model to research this issue.Based on the shared savings structure financing model which is the existing traditional EPC financing model this thesis adds the buyer of carbon emission and then designs the new financing model under the cap-and-trade GHG emission reduction trading mechanism and CDM mechanism respectively. And in this new financing model the emission allowances and emission reductions have their real option value to EMC and owner of EPC project. We can use binomial option pricing model to estimate the price of carbon emission allowances in the financing process according to the actual situation.