Enel SpA, Italy’s largest power company and the biggest single buyer of carbon credits in China, signed a deal to source $232 million of carbon credits with a market value of about $232 million, from five energy efficiency projects undertaken by Wuhan Iron and Steel, Reuters reports.

A statement from the company said the five projects could lead to carbon reductions of 11.45 million tons from 2008 to 2012.

Projects to improve Wuhan Iron and Steel Group’s energy efficiency and reduce emissions will allow Enel to acquire 11.45 million tonnes of carbon credits by 2012.

Sourcing credits from China gives Enel the best value for its money, the company’s statement said, and excess credits could be traded on Europe’s carbon market.

A report to be released this month by researchers from the University of California will suggest China’s greenhouse gas emissions have been underestimated, and probably passed those of the U.S. in 2006-2007.