In 2 years, the Indian city of Mumbai transformed its great eyesore—a 19.6-hectare landfill with 80-foot high waste—into a vast expanse of greenery with considerable revenue-generating potential. Carbon credit financing catalyzed this transformation.

Carbon credits, representing a reduction of greenhouse gases in the atmosphere, are a source of supplementary financing. Projects in developing countries that prevent the generation of greenhouse gases or remove greenhouse gases from the atmosphere can earn these credits, which industrialized countries can buy to offset their emissions.

The Gorai Landfill Closure and Gas Capture Project in Mumbai had significant potential for reducing greenhouse gas emissions. This made it an ideal candidate for procuring carbon credits.

The Asia Pacific Carbon Fund, a trust fund established and managed by the Asian Development Bank (ADB), extended support to the Gorai landfill project by providing carbon cofinancing at the most critical stage—project implementation. The fund’s upfront financing represented 56% of the project’s $9.31 million capital cost. In exchange, the fund secured a portion of the expected future carbon credits to be generated by the Gorai project.

The project proved that carbon credit financing via ADB’s Asia Pacific Carbon Fund can catalyze the environmentally sustainable and financially viable closure of a problematic dump site.