Morgan Stanley to Invest in $3bn of Emissions Reduction Credits and Other Related Initiatives

Morgan Stanley (NYSE:MS) announced today that it plans to invest
in approximately $3 billion of carbon/emissions credits, projects and
other initiatives related to greenhouse gas (GHG) emissions reduction
over the next five years.

The majority of this investment will represent increased
commitments to purchase carbon credits from projects as the Firm's
Commodities Trading Department expands its existing Carbon and
Emissions platform. The remainder will constitute investments in
projects and initiatives related to emissions reduction, such as those
certified under the Clean Development Mechanism (CDM) and Joint
Implementation (JI) initiatives. These projects allow developed
countries to transfer and fund emissions-reducing technology in other
signatory nations. The United Nations oversees the project
registration and approval process.

"We strongly support the use of market-based solutions to meet
environmental policies and objectives," said Simon Greenshields,
Managing Director and Global Head of Power, associated Power Fuels and
Carbon/Emissions Trading and Structuring at Morgan Stanley.

CDM projects produce Certified Emissions Reduction credits that
may be bought and surrendered against reduction obligations. JI
Projects create Emission Reduction Units that in the future will
similarly be used. One hundred and sixty-three countries have signed
and ratified the Kyoto Protocol to the United Nations Framework
Convention on Climate Change. The objective of the Framework is the
stabilization of greenhouse gas concentrations in the atmosphere at a
level that would prevent dangerous anthropogenic interference with the
climate system.

Countries that have ratified are committed to reducing their
emissions of carbon dioxide and five other greenhouse gases. Reduction
may be direct or imported through trading with other countries that
make the reduction. Phase one covers the period 2008 to 2012 and many
countries are already considering implementation for phase two. The
European Union has already implemented a highly successful trial phase
involving capping and trading of emissions allowances across the
industrial and utility sectors over the period 2005 to 2007 and is
currently considering inclusion of the air transportation sector.

Morgan Stanley is a leading global financial services firm
providing a wide range of investment banking, securities, investment
management, wealth management and credit services. The Firm's
employees serve clients worldwide including corporations, governments,
institutions and individuals from more than 600 offices in 30
countries. For further information about Morgan Stanley, please visit
www.morganstanley.com.