PROJECT DESIGN DOCUMENT (PDD) · The key technical specifications of boiler are listed as Table A-1...

UNFCCC/CCNUCC CDM – Executive Board

PROJECT DESIGN DOCUMENT FORM FOR CDM PROJECT ACTIVITIES (F-CDM-PDD)

Version 04.1

PROJECT DESIGN DOCUMENT (PDD)

Title of the project activity National Bio Energy Nangong Biomass Power Plant

Version number of the PDD 01.1 Completion date of the PDD 07/08/2013 Project participant(s) Swiss Carbon Value Ltd. (private entity)

National Bio Energy Co., Ltd. (private entity) Host Party(ies) China Sectoral scope and selected methodology(ies) Sectoral scope 1: energy industries (renewable

sources) ACM0018 Version 2.0.0

Estimated amount of annual average GHG emission reductions

143,010 tCO2e


SECTION A. Description of project activity A.1. Purpose and general description of project activity >> The proposed National Bio Energy Nangong Biomass Power Plant (hereafter refers to as the Project), locates in Nangong county, Hebei province, R.P. China. Nangong County, is an important agriculture especially cotton bases of China. The proposed biomass power plant with the capacity of 30 MW, will utilize local surplus biomass residues (mainly as agricultural biomass residues and wood waste) for electricity generation. The proposed project will install one 130 t/h biomass-fired boiler with the technology from BWE Company of Denmark, which is a world leading company in biomass boilers production and biomass cogeneration. The proposed project will also install one turbine and generator, which are produced domestically. Further details on the equipments are provided in A.3. It is estimated that the Project can deliver 193 GWh of electricity to the North China Grid (NCG) utilizing about 300,000 tons biomass residues per year. The utilized biomass by the project, which is all collected from nearby area of the project, has been open burnt or left to decay before the project. The pre-project situation and the baseline scenario are identical: the electricity is produced within the North China Grid and biomass residues are open burnt or dumped to decay in an uncontrolled manner. Thus, when the proposed project is put into operation, it will produce and claim GHG emissions reductions from: - displacing electricity that would otherwise be produced to supply the high-growth, coal-dominated

power generation of North China Grid, - avoiding CH4 emissions because the straw would otherwise be dumped or left to decay or burnt in

an uncontrolled manner without utilizing it for energy purpose in the absence of the proposed project.

The estimated annual GHG emission reductions are 143,010 tCO2e. The important event of the project please see the table A-1.

Table A-1 Important event of the project Date Event November 2008 FSR finalization 30/12/2008 EIA approval 14/1/2009 Project approval 06/03/2009 CDM decision meeting April 2009 Boiler purchase contract 08/06/2009 Generator purchase contract 17/07/2009 Turbine purchase 25/10/2009 Project construction started May/2010 GS VER ERPA negotionation 26/10/2010 Commission started 23/12/2010 Signed GS VER ERPA

A.2. Location of project activity A.2.1. Host Party(ies) >> China

UNFCCC/CCNUCC CDM – Executive Board A.2.2. Region/State/Province etc. >> Hebei Province A.2.3. City/Town/Community etc. >> Boli village, Wangdaomiao town, Nangong county, Xingtai city A.2.4. Physical/Geographical location >> The project is located 600 meters to the north of Boli village and stands at the north side of Xingde Road. The project has the geographical coordinate with east longitude of 37°21'41. 39"N, 115°23'12. 11"E.

A.3. Technologies and/or measures >> The proposed project will install an 130t/h high temperature and pressure Biomass Direct Burning boiler, the technology are imported from Denmark BWE Company. This technology has been operated successfully in some European countries such as Denmark, England and Germany. The boiler is manufactured by Longji Power Unit Ltd. The key technical specifications of boiler are listed as Table A-1 below.


Table A-2 Key Technical specifications of boiler Parameters Name Unit Value

Model YG-139/9.2-T Type of Boiler / Grate type Boiler maximum continuous rating t/h 130 Superheated Steam pressure Mpa 9.2 Superheated Steam temperature oC 540 Boiler feed-water temperature oC 210 Boiler Efficiency % 92 Boiler Exhaust Temperature oC 190 Boiler fire fuel / Biomass Life time years 20

Other two key equipments are turbine and generator, technologies of which are all provided by domestic manufacturers (respectively Qingdao Jieneng Steam Turbine Group Co., Ltd. and Shandong Jinan Power Generation Equipment Plant). Key technical specifications of turbine and generator are listed as Table A-2 and Table A-3 respectively.

Table A-3 Key technical specifications of turbine

Parameters Name Unit Data Model / N30-8.83 Rated Output MW 30 Rated Rotation Speed r/min 3000 Rated Flow t/h 130 Rated Pressure MPa 8.83 Rated Temperature oC 210 Life time years 20

Table A-4 Key technical specifications of Generator

Parameters Name Unit Data Model / QF-30-2 Rated Output MW 30 Rated Voltage kV 10.5 Rated Electric Current A 3437 Rated Rotation Speed r/min 3000 Efficiency % 80% Life time years 20

The biomass residues used in the project are mainly consisted by 3 categories:

Table A-5 Category of biomass residues Biomass residues category

Biomass residue

type

Biomass residues source

Biomass residues fate in the absence

of the project activity

Biomass residues use in project scenario

Biomass residues wet

mass (tonnes)

1 Cotton stalk

Off-site from the nearby farmland

Dumped or left to decay under

aerobic condition (B1)

Electricity generation on-site (biomass-only

boiler) 216,000

2 Wood wastes

Off-site from the nearby

Dumped or burnt in an uncontrolled

Electricity generation on-site (biomass-only 24,000


area manner (B1) boiler)

3 Corn and wheat stalk


Dumped or burnt in an uncontrolled

manner (B1&B3)

Electricity generation on-site (biomass-only

boiler) 60,000

A.4. Parties and project participants

Party involved (host) indicates a host Party

Private and/or public entity(ies) project participants

(as applicable)

Indicate if the Party involved wishes to be considered as

project participant (Yes/No)

China (host) National Bio Energy Co., Ltd. (Private entity)

No

Switzerland Swiss Carbon Value Ltd. (Private entity)

No

A.5. Public funding of project activity >> The project activity hasn’t received any public funding from parties of Annex I.

SECTION B. Application of selected approved baseline and monitoring methodology B.1. Reference of methodology >>

ACM0018 Version 2.0.0 “Consolidated methodology for electricity generation from biomass residues in power-only plants” In line with the application of the ACM0018 methodology the project refers to the following tools and methodology: Version 02 of Tool to calculate project or leakage CO2 emissions from fossil fuel combustion. Version 06.0.1 of Emissions from solid waste disposal sites. Version 01 of Tool to calculate baseline, project and/or leakage emissions from electricity

consumption. Version 03.0.0 of Tool to calculate the emission factor for an electricity system. Version 03.0.1 of Assessment of the validity of the original/current baseline and update of the

baseline at the renewal of the crediting period Version 01.1.0 of Project and leakage emissions from transportation of freight. B.2. Applicability of methodology >> The approved baseline and monitoring methodology ACM0018 “Consolidated methodology for electricity generation from biomass residues in power-only plants” is applicable to project activities both in the project type and biomass category. The detail is listed as bellowing.

Table B-1 Applicability of methodology Methodology Project The installation of new biomass residues (co-)fired power-only plants at a site where currently no power generation occurs (greenfield power projects);

The proposed project is a Greenfield biomass residues fired power-only plant.

No other biomass types than biomass residues, as Only agricultural and woody biomass residues

UNFCCC/CCNUCC CDM – Executive Board defined above, are used in the project plant collected in the nearby area, as defined above, are

used in the project. Fossil fuels may be co-fired in the project plant. However, the amount of fossil fuels co-fired shall not exceed 80% of the total fuel fired on an energy basis

No fossil fuel is co-fired in the project plant.

For projects that use biomass residues from a production process (e.g. production of sugar or wood panel boards), the implementation of the project shall not result in an increase of the processing capacity of raw input (e.g. sugar, rice, logs, etc.) or in other substantial changes (e.g. product change) in this process

All the biomass residues used in the project are the waste from agriculture and wood industry; the biomass residues treatment in the project won’t cause any production increase in the relevant industry.

The biomass residues used by the project facility should not be stored for more than one year

Biomass in the project site won’t be stored for more than one year in which case the energy of biomass would lose largely.

Projects that chemically process the biomass residues prior to combustion (e.g. by means of esterification, fermentation and gasification) are not eligible under this methodology. The biomass residues can however be processed physically such as by means of drying, pelletization, shredding and briquetting

As the direct-combustion technical adopt in the power plant, biomass don’t need any chemically process.

No power and heat plant operates at the project site during the crediting period

As the national regulation and the quantity of biomass source, no other power and/or heat plant would operate at the project site during the crediting period.

If any heat is generated for purposes other than power generation (e.g. heat which is produced in boilers or extracted from the header to feed thermal loads in the process) during the crediting period or was generated prior to the implementation of the project activity, by any on-site or off-site heat generation equipment connected to the project site, the following conditions should apply:

(a) The implementation of the project activity does not influence directly or indirectly the operation of the heat generation equipment, i.e. the heat generation equipment would operate in the same manner in the absence of the project activity;

(b) The heat generation equipment does not influence directly or indirectly the operation of the project plant (e.g. no fuels are diverted from the heat generation equipment to the project plant); and

(c) The amount of fuel used in the heat generation equipment can be

No heat would be generated for the purposes other than power generation.


monitored and clearly differentiated from any fuel used in the project activity.

In the case of fuel switch project activities, the use of biomass residues or the increase in the use of biomass residues as compared to the baseline scenario is technically not possible at the project site without a capital investment in:

• The retrofit or replacement of existing heat generators/boilers; or

• The installation of new heat generators/boilers; or

• A new dedicated biomass residues supply chain established for the purpose of the project (e.g. collecting and cleaning contaminated new sources of biomass residues that could otherwise not be used for energy purposes);

• Equipment for preparation and feeding of biomass residues.

It’s not a fuel switch project.

The project activity is a Greenfield power-only plant, which exports the power to the North China Grid. There was no any other power or heat-generation plant ever operated in the project site before the project. Only agricultural and woody biomass residues within the applicable biomass categories in the methodology, which are obtained from the nearby area, are used in the project. The storage term of the biomass residues is usually shorter than 1 year. The power project adopts biomass direct flaring technology, there was no any chemical process is needed for the biomass fuel. Part of the biomass would undergo shredding before combustion. No power and heat plant would operate at the project site during the crediting period. Therefore, the approved CDM consolidated methodology ACM0018 is applicable to the proposed project. B.3. Project boundary

Table B-2 GHGs source included or excluded from the project boundary Source Gas Included? Justification/Explanation

CO2 Included Main emission source

CH4 Excluded Excluded for simplification. This is conservative

Electricity generation

N2O Excluded Excluded for simplification. This is conservative B

asel

ine

Uncontrolled burning or decay of CO2 Excluded It is assumed that CO2 emissions from

surplus biomass residues do not lead to


CO2 Excluded changes of carbon pools in the LULUCF sector

CH4 Included B1 and B3 are the most likely baseline scenarios.

surplus biomass residues

N2O Excluded Excluded for simplification. This is conservative

CO2 Included May be an important emission source

CH4 Excluded Excluded for simplification. This emission source is assumed to be very small

On-site fossil fuel consumption

N2O Excluded Excluded for simplification. This emission source is assumed to be very small

CO2 Included May be an important emission source

CH4 Excluded Excluded for simplification. This emission source is assumed to be very small

On-site and off-site transportation and

processing of biomass residues N2O Excluded Excluded for simplification. This emission

source is assumed to be small

CO2 Excluded It is assumed that CO2 emissions from surplus biomass do not lead to changes of carbon pools in the LULUCF sector

CH4 Included CH4 emissions will be caused during the course of power.

Combustion of biomass residues for electricity

N2O Excluded Excluded for simplification. This emission source is assumed to be small

CO2 Excluded

It is assumed that CO2 emissions from surplus biomass residues do not lead to changes of carbon pools in the LULUCF sector

CH4 Excluded

Excluded for simplification. Since biomass residues are stored for not longer than one year, this emission source is assumed to be small

Storage of biomass residues

N2O Excluded Excluded for simplification. This emissions source is assumed to be very small.

CO2 Excluded

It is assumed that CO2 emissions from surplus biomass residues do not lead to changes of carbon pools in the LULUCF sector

CH4 Excluded This emission source is not included as the wastewater is not treated under anaerobic conditions

Proj

ect A

ctiv

ity

Waste water from the treatment of biomass residues

N2O Excluded Excluded for simplification. This emission source is assumed to be small

Fig B-1 Project boundary


B.4. Establishment and description of baseline scenario >> According to the version 02.0.0 of ACM0018, the following steps are used to define the baseline scenario: Step 1. Identification of alternative scenarios This step serves to identify all alternative scenarios to the proposed VER project activity that can be the baseline scenario through the following sub-steps: Step 1a. Define alternative scenarios to the proposed VER project activity. In the “Identification of the baseline scenario” of ACM0018, realistic and credible alternatives should be separately determined regarding: Identify all alternative scenarios that are available to the project participants and that provide outputs or services with comparable quality, properties and application areas as the proposed VER project activity. In doing so, alternative scenarios shall be separately determined regarding:

• How electric power would be generated in the absence of the VER project activity: and • What would happen to the biomass residues in the absence of the project activity.

1. Power generation In order to determine the most plausible baseline scenario for power generation, detailed analyses are summarized in Table B-2:

Table B-3 identifying the most plausible baseline scenario for power generation


Series Alternative Applicable? Justification/Explanation P1 The proposed project activity not undertake as

a VER project activity: Yes

P2 If applicable, the continuation of power generation in the existing power-only plants fired with biomass residues, or fossil fuels, or a combination of both, at the project site. The existing power-only plants would operate at the same conditions as those observed in the most recent three years prior to the project activity

No There was no existing biomass residue fired power plant at the project site. Therefore, Alternative P2 is not realistic.

P3 If applicable, the continuation of power generation in the existing power-only plants fired with biomass residues, or fossil fuels, or a combination of both, at the project site. The existing power-only plants would operate with different conditions from those observed in the most recent three years prior to the project activity


P4 If applicable, the retrofitting of existing power-only plants fired with biomass residues, or fossil fuels, or a combination of both, at the project site. The retrofitting may or may not include a change in fuel mix


P5 The generation of power in the grid Yes

All the power is from grid in the project site now. It’s a realistic scenario.

P6 The installation of new power-only plants fired with biomass residues, or fossil fuels, or a combination of both, at the project site, using the same amount or less biomass residues than under scenario P1:

No Fossil fuel plant with a capacity of 135MW or less is strictly prohibited according to current regulations1 in China. Co-fired with fossil fuel is forbidden for new Greenfield biomass power plant as national regulation2. As the leading biomass power plant company, PO adopted the best technology in the world. Other biomass power plant with similar capacity using the same or less biomass residues isn’t available in China beside P1. So P6 is not realistic.

P7 The installation of new power-only plants fired with biomass residues, or fossil fuels, or a combination of both, at the project site, using more biomass residues than under scenario P1:

No Fossil fuel power plant with a capacity of 135MW or less is strictly prohibited according to current regulations in China. Co-fired with fossil fuel is

1 http://www.gov.cn/gongbao/content/2002/content_61480.htm 2 http://www.zhb.gov.cn/info/bgw/bwj/200809/t20080908_128308.htm


forbidden for new Greenfield biomass power plant as national regulation In the case new biomass power plant using more biomass residues, it isn’t a financially attractive plan than P1 due to higher cost within the available technology. And as analyzed in B5 of PDD, the NPV of P1 is much lower than 0, so P7 can’t a realistic baseline scenario.

As analyzed above, Alternative P1and P5 are considered as plausible baseline scenarios. 2. Use of biomass The fuel of the proposed project is composed by agricultural waste and woody residue. Without the proposed project activity, a huge amount of biomass residues are open burnt or left unused in the project area. According to the methodology ACM0018, the category of the utilized biomass is described below:

Table B-4 category of biomass residues

Biomass residues

category (k) Biomass

residue type Biomass

residues source

Biomass residues fate in the absence of

the project activity

Biomass residues use in

project scenario

Biomass residues wet

mass (tonnes)

1 Cotton stalk Off-site from

the nearby farmland

Dumped or left to decay under

aerobic condition (B1)

Electricity generation on-site (biomass-only boiler)

216,000

2 Wood wastes Off-site from the nearby area

Dumped or burnt in an

uncontrolled manner (B1)


24,000

3 Corn and wheat stalk


Dumped or burnt in an

uncontrolled manner

(B1&B3)


60,000

When defining plausible and credible alternative scenarios for the use of biomass residues, the guidance below should be strictly followed:

• If the biomass residues involve any type of processing prior to combustion such as drying, pelletization, shredding, briquetting, etc., two options can be considered. The biomass residues processing plant is included in the project boundary and the primary source of the biomass residues is assessed according to the procedures described in this section. Therefore, if pellets are used in the project activity and the pelletization plant is included in the project boundary, the biomass residues used as raw material for the production of pellets have to be assessed


using the procedures described herein. Otherwise, if the biomass residues processing plant is not included in the project boundary then the processed biomass obtained from that plant should be considered as B8 above;

• The baseline scenario for the use of biomass residues should be separately identified for different categories of biomass residues, covering the whole amount of biomass residues supposed to be used in the project activity along the crediting period, and consistent with the alternative scenarios selected for power generation (Scenarios P above);

• A category of biomass residues is defined by three attributes: (1) its type (i.e. bagasse, rice husks, empty fruit bunches, etc.); (2) its source (e.g. produced on-site, obtained from an identified biomass residues producer, obtained from a biomass residues market, etc.); and (3) its fate in the absence of the project activity (Scenarios B above);

The scenarios B1 or B3: can only be regarded as a plausible baseline scenario for a certain category of biomass residues, if the project participants can demonstrate that at least one of the two approaches (a) or (b) are fulfilled. Otherwise, the baseline scenario for this particular biomass residues category should be considered as B8:, and a leakage penalty will be applied when calculating leakage emissions. If during the crediting period, new categories of biomass residues of the type B1:, B2: or B3: are used in the project activity which were not listed at the validation stage, e.g. due to new sources of biomass residues, the baseline scenario for those types of biomass residues should be assessed using the procedures outlined in this guidance for each category of biomass residues. Identify realistic combinations of scenarios for electric power generation and use of biomass residues. The identified realistic combinations should be considered in the following steps. Detailed analyses on each alternative are summarized in Table B-5.

Table B-5 identifying the most plausible baseline scenario for biomass use Series Alternative Applicable? Justification/Explanation B1 The biomass residues are

dumped or left to decay mainly under aerobic conditions. This applies: for example, to dumping and decay of biomass residues on fields

Yes It’s common that biomass residues be dumped or left to decay around the site of the proposed project. Alternative B1 is a realistic baseline alternative for unused biomass.

B2 The biomass residues are dumped or left to decay under clearly anaerobic conditions. This applies, for example, to landfills, which are deeper than 5 meters. This does not apply to biomass residues that are stock-piled or left to decay on field

No The concerned biomass residues in the project area are widely burnt or left to decay on field rather than anaerobic treatment. Local people have no habit to bury stalks or woody wastes because there is no enough land and labor to do so.

B3 The biomass residues are burnt in an uncontrolled manner without utilizing for energy purposes

Yes It’s common that biomass residues be burnt in an uncontrolled manner without utilizing it for energy purposes. Therefore, Alternative B3 is one realistic baseline alternative for unused biomass.


B4 The biomass residues are used for electricity generation in power-only plant configuration at the project site in new and/or existing power plants

No As the Hebei province regulation3, the second biomass power/heat plant won’t be approved within 100km distance to the existing ones in order to avoid biomass resource competition. There is no any other power plant to take use of the biomass residues in the baseline scenario. B4 is excluded.

B5 The biomass residues are used for power and/or heat generation in other existing or new power plants at other sites

No There is no generation and/or heat project using biomass residues as fuel close to proposed project. Considering the cost of biomass transportation, other existing or new grid-connected power plants in distance will not use the biomass residues in the project area. B5 is excluded.

B6 The biomass residues are used for other energy purposes, such as the generation of bio-fuels

No There is no biomass residues based energy facility around the proposed project site. So alternative B6 is not a realistic baseline alternative for unused biomass

B7 The biomass residues are used for non-energy purposes, e.g. as fertilizer or as feedstock in processes (e.g. in the pulp and paper industry)

No The biomass residues in the project mainly cotton, corn stalk and woody residues have not been used as paper or other non-energy industry in local area. Therefore, B7 is excluded.

B8 The primary source of the biomass residues and/or their fate in the absence of the project activity cannot be strictly identified

No The biomass fates have been studied and stated clearly in the Biomass Survey Report according to the on site research from local government.

As analyzed above, the most realistic and credible alternative for biomass use is B1and B3. Outcome of step 1a: list of plausible alternative scenarios to the project activity Therefore, the most realistic and credible alternative is as follows:

Table B-6 List of plausible alternative Scenarios

Alternative Scenarios Project Type Power Generation Use of biomass

Scenario 1 The proposed project activity not undertake as a CDM or VER project activity

P1 B1 or B3

Scenario 2 No any biomass utilized power plant project P5 B1 or B3

Sub-step 1b. Consistency with mandatory laws and regulations For power generation, P1 (The proposed project activity not undertaken as a CDM or VER project activity) is encouraged by government in order to make usage of the surplus biomass. P5 (Supply of equivalent power generation by the North China Grid) which is just a common behavior, consistent with related laws and regulations in China. 3 http://hebei.hebnews.cn/2010-09/23/content_743519.htm

UNFCCC/CCNUCC CDM – Executive Board As for biomass use, related policies and regulations have been issued, such as Renewable Energy Promotion Law and Renewable Energy. But currently there are no related regulations that compel to use biomass. Biomass has been dumped or left to decay or burned in an uncontrolled manner are ubiquitous both in China and near the project site. Therefore, B1 or B3 is a common scenario in the real world. Sub-step 1b. Consistency with mandatory laws and regulations As for power generation, P1 (The proposed project activity not undertaken as a CDM or VER project activity) and P5 (Supply of equivalent power generation by the North China Grid) are consistent with related laws and regulations in China. As for biomass use, related policies and regulations have been issued, such as Renewable Energy Promotion Law and Renewable Energy. But currently there are no related regulations that compel to use biomass. Biomass has been dumped or left to decay or burned in an uncontrolled manner are ubiquitous both in China and near the project site. Therefore, B1 or B3 is a common scenario in the real world.

Outcome of Step 1b: Based on the analysis above, the 2 alternative scenarios listed in the outcome of Step 1a are in line with the existing Chinese laws and regulations. Step 2. Barrier analysis This step serves to identify barriers and to assess to which alternatives are prevented by these barriers. Sub-step 2a. Identify barriers that would prevent the implementation of alternative scenarios

Establish a complete list of realistic and credible barriers that may prevent alternative scenarios to occur. Such realistic and credible barriers may include:

• Investment barriers, other than insufficient financial returns as analyzed in Step 3, inter alia:

o For alternatives undertaken and operated by private entities: Similar activities have only been implemented with grants or other non-commercial finance terms. Similar activities are defined as activities that rely on a broadly similar technology or practices, are of a similar scale, take place in a comparable environment with respect to regulatory framework and are undertaken in the relevant geographical area, as defined in Sub-step 1a above;

o No private capital is available from domestic or international capital markets due to real or perceived risks associated with investments in the country where the project activity is to be implemented, as demonstrated by the credit rating of the country or other country investment reports of reputed origin.

• Technological barriers, inter alia:

o Skilled and/or properly trained labor to operate and maintain the technology is not available in the relevant geographical area, which leads to an unacceptably high risk of equipment disrepair, malfunctioning or other underperformance;

o Lack of infrastructure for implementation and logistics for maintenance of the technology (e.g. natural gas can not be used because of the lack of a gas transmission and distribution network);

o Risk of technological failure: the process/technology failure risk in the local circumstances is significantly greater than for other technologies that provide services or outputs comparable to those of the proposed CDM project activity, as demonstrated by relevant scientific literature or technology manufacturer information;


o The particular technology used in the proposed project activity is not available in the relevant geographical area.

• Lack of prevailing practice:

o The alternative is the “first of its kind”.

• Other barriers, preferably specified in the underlying methodology as examples. There is no barrier above could prevent the implementation of the alternative scenario 1 and 2. Outcome of Step 2a: No barrier that may prevent alternative scenario 1 and 2 above to occur Sub-step 2b: Eliminate alternative scenarios which are prevented by the identified barriers

Identify which alternative scenarios are prevented by at least one of the barriers listed in Sub-step 2a, and eliminate those alternative scenarios from further consideration. All alternative scenarios shall be compared to the same set of barriers. The assessment of the significance of barriers should take into account the level of access to and availability of information, technologies and skilled labour in the specific context of the industry where the project type is located. For example, projects located in sectors with small and medium sized enterprises may not have the same means to overcome technological barriers as projects in a sector where typically large or international companies operate.

Outcome of step 2b: No barrier that may prevent alternative scenario 1 and 2 above to occur Outcome of Step 2: Alternative scenarios 1 and 2 are not prevented by any barrier.

Table B-7 List of remaining alternative Scenarios after barrier analysis Alternative Scenarios Project Type

Power Generation Use of biomass Baseline 1 The proposed project activity not undertake

as a CDM or VER project activity P1 B1 or B3

Baseline 2 No any biomass utilized power plant project P5 B1 or B3

Since there are still 2 alternative scenarios remaining, including the proposed project activity undertaken without being registered as a CDM or VER project activity (Baseline 1), proceed to Step 3 (investment analysis). B.5. Demonstration of additionality >>

Step 3: Investment analysis

For an alternatives which does not involve any investment by the project participants, use the following values for the financial indicator:

• If the financial indicator is the NPV: assume a value of NPV equal to zero;

• If the financial indicator is the IRR: use as the IRR the financial benchmark, as determined through the options (a) to (e) below.

The proposed project adopts the financial indicator of NPV according to the methodology. As indicated in the ACM0018, for an alternative which does not involve any investment by the project participants, use

UNFCCC/CCNUCC CDM – Executive Board the following values for the financial indicator: If the financial indicator is the NPV: assume a value of NPV equal to zero. So NPV of the relevant baseline scenario (Scenario 2) is assumed to be 0. Based on what mentioned above, the calculation and comparative analysis of financial indicators for the proposed project are carried out. (1) Basic parameters for calculation of financial indicators

Table B-8 Key parameters for the calculation of financial indicators

Parameter Value Unit Data source Installed capacity 30 MW FSR Total static investment 29,520 (×104) RMB FSR Annual power output 193,815 MWh FSR Tariff (Including VAT) 0.6168 RMB/KWh FSR Tariff (Excluding VAT) 0.52718 RMB/KWh FSR Biomass residue price 260 RMB/t FSR Biomass residue consumption 300,000 Ton FSR Depreciation year 15 Year FSR Depreciation rate 6.33 % FSR Residue rate 5 % FSR VAT for Electricity 17 % FSR O&M Cost (average value) 7,938 (×104) RMB FSR Project lifetime 21 (including 1 year of

construction period) Year FSR

Discount rate 8 % FSR (2) Comparison of Project NPV for the proposed projects Compare the indicators of the proposed VER project and all the alternative scenarios. The results of NPV calculation with the input values available at the moment investment decision made with and without VER revenue are listed in Table B.2.

Table B-9 NPV comparison of the proposed project

Scenarios Without VER (Baseline 1)

Baseline 2 With VER (VER Project)

NPV (million RMB) -78.70 0 61.69 As seen above, the Project NPV without VER revenue is much lower than benchmark which means the project without VER revenue (also Baseline 1) is not attractive compared with the scenario that do no investment at all (Baseline 2). So Baseline 1 could be considered as financial unattractive compared with other alternative scenarios. At the same time, the VER revenue could largely improve the financial situation and make the proposed VER project more financial applicable. Sensitivity analysis. The objective of sensitivity analysis is to show whether the conclusion regarding the financial attractiveness is robust to reasonable variations in the critical assumptions. For the proposed project, the following financial parameters were taken as uncertain factors for sensitive analysis of financial attractiveness:

UNFCCC/CCNUCC CDM – Executive Board 1. Total static investment 2. Annual O&M cost 3. Tariff (excluding VAT) 4. Annual power supply

Table B-10 Sensitivity analysis

NPV(million RMB) -10% -7.50% -5% -2.50% 0 2.50% 5% 7.50% 10%

Total static investment -48.06 -55.65 -63.29 -70.98 -78.70 -86.46 -94.26 -102.11 -109.98

O&M cost -15.50 -30.24 -45.79 -61.97 -78.70 -95.87 -113.32 -130.78 -148.24

Electricity Tariff -166.92 -144.79 -122.66 -100.52 -78.70 -57.58 -37.38 -18.33 -0.72 Annual power supply -106.89 -99.77 -92.68 -85.66 -78.70 -71.82 -65.01 -58.29 -51.67

Fig B-2 Sensitivity analysis

(a) Total static investment The NPV would not exceed benchmark even until the total static investment decreased by 26.283%. According to the statistics released by National Statistics Bureau of China in 2009, the national total price index of investment in fixed assets are 101.5, 103.9and 108.9 during year 2006, 2007 and 2008 respectively4. The trend showed clear the investment price has been going up during the project planning and construction stage and impossible to decrease.

4 China Statistic Year Book http://www.stats.gov.cn/tjsj/ndsj/2008/indexch.htm http://www.stats.gov.cn/tjsj/ndsj/2009/indexch.htm

UNFCCC/CCNUCC CDM – Executive Board (b) Annual O&M cost Only where the annual O&M cost decrease by 12.807% would the Project NPV rise to 0. According to the FSR, the annual O&M costs include biomass expense, material expenses, water expenses, salary and welfare, heavy repair expenses and the miscellaneous expenses. Considering these expenses are ever- growing year by year over the recent years, the annual O&M costs will be impossible to decrease. Therefore, as what are stated above, the annual O&M cost is not likely to decrease. (c) Tariff With other influence factors remaining unchanged, only when the tariff increases by at least 10.105%, the NPV could exceed 0. According to the Interim Regulation for Tariff of Renewable Energy Power Generation and Appointment of Expenses5, which came into effect on 1 January 2006, when the biomass power industry has just started in China. The tariff is driven by the tariff for coal fired power plants in the year 2005 in the province and the compensation tariff of 0.25 RMB/kWh. According to the Notification of National Development and Reform Commission (NDRC) on Electricity Price Increase for North China Power Grid6, which came into effect on 1 July 2008, the tariff for coal fired power plants in southern Hebei Province increases to be 0.3668 RMB/kWh (including VAT). Based on these two regulations, the tariff of 0.6168 RMB/kWh (including VAT) has been used in FSR for financial analysis, which was already the conservative value at the investment decision time. (d) Annual power supply Only where the annual power supply increases by 31.385% does the Project NPV go above 0. The power generation is decided by annual utilization hours, but at the same time, when the annual utilization hours increase, the operation cost will correspondingly increase due to increase of biomass consumption. The proposed project has a utilization hour of 7,300 h according to the FSR. Compared to the average 6,869 h annually actual operating hours during operation of the project, it’s already quite conservative for the operating hours of 7,300 h used at the investment decision time considering the equipment regular examined and repaired and the operation cost increase. In addition, as the seasonal supplying of the biomass and the biomass power plant is still in the start stage, the stable of the boiler and other equipment need improve as well. So far it’s impossible for the operating hours to exceed the threshold. Based on the above sensitivity analysis, there is clear evidence that the implementation of the project without VER revenues is not above the typical rate of the economically attractive course of action in China. Therefore, if the project is not undertaken as a registered VER project, it is not financially viable, even when possible variations in the main parameters are considered. As analyzed above, Baseline scenario 1 (P1 to power generation, B1 or B3 to unused biomass) lacks financial attractiveness. Baseline scenario 2 (P5 to power generation, B1 or B3 to unused biomass) is not a specific project to be invested. The import power from the NCG will not only meet the requirements of national laws and regulations, but also be financially feasible. Moreover, the biomass residues to be utilized in the proposed project is currently dumped or left to decay under mainly aerobic conditions or burnt in an uncontrolled manner without utilizing it for energy purposes, which doesn’t need any facility and is in full compliance with all the applicable laws and mandatory regulations. Outcome of Step 3. As analyzed above and will be dominated in the Section B.5, the most applicable baseline scenario of the project is determined as scenario 2 of the alternative scenarios. 5 http://www.gov.cn/ztzl/2006-01/20/content_165910.htm 6 http://www.sdpc.gov.cn/zcfb/zcfbtz/2008tongzhi/t20080702_222220.htm


Baseline Scenario Project Type Power Generation Use of biomass

Scenario 2 Power Greenfield Project P5 B1 or B3 STEP 4. Common practice analysis

Provide an analysis of any other activities that are operational and that are similar to the proposed project activity. Projects are considered similar if they are in the same country/region and/or rely on a broadly similar technology, are of a similar scale, and take place in a comparable environment with respect to regulatory framework, investment climate, access to technology, access to financing, etc. The projects with broadly similar technology including biomass power-only power plant and biomass cogeneration plant are considered as similar project. The projects located in the region with same two-season dry farmland agricultural area are seen as the similar considering the boiler technical, biomass type and price. The scale of the similar project is defined as the project capacity within (±50%) of the proposed project, which is 15MW-45MW. By the June of 2012, there are 8 similar biomass power generation projects put into operation in Hebei province7 and nearby province. They have all applied as CDM to overcome the identified barriers8.

Table B-11 10 Similar project in or nearby Hebei province

No. Project in Hebei province 1 Pingquan Biomass-based Power Generation Project 2 Hengshui TEDA Gucheng Biomass-based Power Generation Project 3 Hebei Wu’an Ruikang 48MW Biomass Power Generation Project 4 Hebei Zunhua Straw Power Generation Project 5 Hebei ChengAn Biomass Cogeneration Project 6 Straw generation project in Wei county Hebei province, P.R. China 7 Hebei Jinzhou 24MW Straw-Fired Power Project 8 Hebei Wuqiao Biomass Generation Project Project in nearby provinces 9 Shandong Shanxian 1*25MW Biomass Power Plant Project 10 Biomass Generation Project in Xun county, Henan province, P.R. China

Extent to the nearby province of similar area including Shandong, Shanxi, Henan and northern Anhui province, there are more than 20 biomass power projects, which are all applying for CDM project. It’s common that the similar biomass projects are all applying for CDM or other carbon revenue to improve their weak financial condition. To summarize, it can be proved that the proposed project meets the additionality criteria in the aspects of environment, investment and technology. Outcome of Step 4: No similar option without applying for CDM can be reserved. Therefore, the proposed project is additional.

7 http://www.hebei.gov.cn/syscolumn/hyzx/jj/gy/index.htm 8 http://cdm.unfccc.int

UNFCCC/CCNUCC CDM – Executive Board According to the analysis in Section B.5, the baseline scenario applying to the proposed project is shown below:

Table B-12 Combination of the baseline scenario for the proposed project

Baseline scenario Scenario Project type Power generation Biomass use 2 No investment P5 B1 or B3

B.6. Emission reductions B.6.1. Explanation of methodological choices >>

Emission reductions are calculated as follows:

(1)

Where: ERy = Emissions reductions during year y (tCO2) BEy = Baseline emissions during year y (tCO2) PEy = Project emissions during year y (tCO2) LEy = Leakage emissions during year y (tCO2)

Baseline Emissions

Baseline emissions may, where applicable, include the following emission sources:

• CO2 emissions from fossil fuel power plants at the project site;

• CO2 emissions from grid-connected fossil fuel power plants in the electricity system;

• CH4 emissions from anaerobic decay of biomass residues and/or CH4 emissions from uncontrolled burning of biomass residues without utilizing them for energy purposes.

Baseline emissions are calculated as follows:

(2)

Where: BEy = Baseline emissions in year y (tCO2e) BEEL,y = Baseline emissions due to generation of electricity in year y (tCO2) BEBR,y = Baseline emissions due to uncontrolled burning or decay of biomass residues in year

y (tCO2e)

According to the ACM0018 version 02.0.0, the calculation of baseline emissions due to uncontrolled burning or decay of biomass residues is optional. The project participants do not include these emission sources in baseline calculation. Thus,

BEy=BEEL,y

Baseline emissions are determined through the following steps:

Step 1: Determination of BEEL,y

Baseline emissions from electricity generation are calculated based on the net quantity of electricity generated at the project site under the project scenario (EGPJ,y) and a baseline emission factor (EFBL,EL,y) which expresses the weighted average CO2 intensity of electricity generation in the baseline, as follows:


(3)

Where: BEEL,y = Baseline emissions due to generation of electricity in year y (tCO2) EGPJ,y = Net quantity of electricity generated in all power plants which are located at the

project site and included in the project boundary in year y (MWh) EFBL,EL,y = Emission factor for electricity generation in the baseline in year y (tCO2/MWh)

For this methodology, it is assumed that transmission and distribution losses in the electricity grid are not influenced significantly by the project activity and are therefore not accounted for.

Step 1.1: Determination of EGPJ,y

The net quantity of electricity generated in all power plants which are located at the project site and included in the project boundary (EGPJ,y) is determined as the difference between the gross electricity generation at the project site (EGPJ,gross,y) and the auxiliary electricity consumption required for the operation of the power plants at the project site (EGPJ,aux,y), as follows:

(4)

Where: EGPJ,y = Net quantity of electricity generated in all power plants which are located at the

project site and included in the project boundary in year y (MWh) EGPJ,gross,y = Gross quantity of electricity generated in all power plants which are located at the

project site and included in the project boundary in year y (MWh) EGPJ,aux,y = Total auxiliary electricity consumption required for the operation of the power

plants at the project site (MWh)

EGPJ,aux,y shall include all electricity required on-site for the operation of equipment related to the preparation, processing, storage and transport of biomass residues (e.g. for mechanical treatment of the biomass, conveyor belts, driers, pelletization, shredding, briquetting processes, etc.) and electricity required for the operation of all power plants which are located at the project site and included in the project boundary (e.g. for pumps, fans, cooling towers, instrumentation and control, etc.).

Step 1.2: Determination of EFBL,EL,y The electricity generated under the project activity could be generated in the baseline in three different ways, depending on the baseline scenario and the particular situation of the project activity.

• Use of biomass residues at the project site. Electricity could be generated with biomass residues in power plants at the project site. This applies, for example, if

(a) The project activity is a replacement of an existing biomass residues fired power plant;

(b) The project activity is a capacity expansion of an existing biomass residues fired power plant by installing a new biomass residues fired power plant that is operated next to the existing plant;

(c) The project activity is a fuel switch project activity where some biomass residues have already been used prior to the implementation of the project activity.

AND/OR

• Use of fossil fuels at the project site. Electricity could be generated with fossil fuels in power plants at the project site. This applies, for example, if

(a) The project activity is a fuel switch from fossil fuels to biomass residues;


(b) In the baseline, a fossil fuel power plant would continue to operate at the project site in parallel with a new biomass residues power plant;

AND/OR

• Power generation in the electricity grid. Electricity could be generated by power plants in the electricity grid. This applies, for example, if

(a) The project activity exports all electricity to the grid and no electricity would be produced at the project site in the baseline;

(b) The project activity results in an increase of the quantity of electricity produced by power plants included in the project boundary and this increased electricity is exported to the grid or would in the baseline be purchased from the grid.

In the baseline scenario, the project activity exports all electricity to the grid (P5). Therefore, the baseline scenario of electricity generated under the project activity could be Power generation in the electricity grid.

Based on this approach, EFBL,EL,y is calculated as follows:

(5)

Where: EFBL,EL,y = Emission factor for electricity generation in the baseline in year y (tCO2/MWh) EGBL,BR,y = Amount of electricity that would be generated with biomass residues in power-

only plants operated at the project site in the baseline in year y (MWh) EGBL,FF,y = Minimum amount of electricity that would be generated with fossil fuels at the

project site in the baseline in year y (MWh) EGBL,grid,y = Minimum amount of electricity that would be generated by power plants in the

electricity grid in the baseline in year y (MWh) EGBL,FF/grid,y = Amount of electricity that could be generated in the baseline either by power

plants in the electricity grid or by power plants at the project site using fossil fuels in year y (MWh)

EFgrid,CM,y = Combined margin CO2 emission factor for grid-connected electricity generation in year y (tCO2/MWh)

EFBL,FF,y = CO2 emission factor for electricity generation with fossil fuels in power plant(s) at the project site in the baseline in year y (tCO2/MWh)

In the following, first the amounts of electricity generated from the various sources in the baseline (EGBL,BR,y, EGBL,grid,y, EGBL,FF,y and EGBL,FF/grid,y) are determined, taking into account the project configuration and the baseline scenario. Therefore, different cases have to be considered. Then the emission factors (EFgrid,CM,y and EFBL,FF,y) are determined.

Step 1.3: Determination of EGBL,BR,y

The amount of electricity that would be generated with biomass residues in power-only plants operated at the project site in the baseline (EGBL,BR,y) should, in accordance with the baseline scenario and the historical situation before project implementation, be determined as follows:

Case 1: No power generation with biomass residues in the baseline. If Scenario B4 does not apply to any biomass residue category (i.e. if no biomass residues would be used for electricity generation in power-only plants in the baseline), then: EGBL,BR,y = 0.

UNFCCC/CCNUCC CDM – Executive Board Case 2: Power generation with biomass residues in the baseline. If Scenario B4 applies to all or

parts of the biomass residues fired in the power plant(s) included in the project boundary (i.e. if all or parts of the biomass residues would be used in the baseline for electricity generation in power-only plants included in the baseline boundary), then EGBL,BR,y is calculated as follows:

Where: EGBL,BR,y = Amount of electricity that would be generated with biomass residues in power-

only plants operated at the project site in the baseline in year y (MWh) ȠBL,BR,p = Efficiency of electricity generation of baseline power plant p if fired only with

biomass residues and not with fossil fuels (ratio) BRBL,n,p,y = Quantity of biomass residues of category n that would be fired in power-only

plant p in the baseline in year y (tones on dry-basis) NCVn,y = Net calorific value of biomass residues of category n in year y (GJ/tonnes on dry-

basis) n = Biomass residues categories p = Power-only plants at the site of the project activity that would (partly) use

biomass residues to generate electricity in the baseline

As only B1 and B3 is the case of the proposed project, no biomass was used for power generation in baseline, Case 1 is applicable to the project, so

EGBL,BR,y = 0

Step 1.4: Determination of EGBL,FF,y

The minimum amount of electricity that would be generated with fossil fuels at the project site in the baseline in year y (EGBL,FF,y) should, in accordance with the baseline scenario and the historical situation before project implementation, be determined as follows:

Case 1: No use of fossil fuels in the baseline. This case applies if no fossil fuels would be used for electricity generation in the baseline scenario at the project site. In this case, EGBL,FF,y = 0.

Case 2: No connection to the electricity grid. This case applies if all power plants included in the project boundary are off-grid power plants. In this case, the electricity generated by the project can only displace on-site electricity generation with fossil fuel and/or biomass residues (EGPJ,y = EGBL,FF,y + EGBL,BR,y). Accordingly, EGBL,FF,y is calculated as follows:

Where: EGBL,FF,y = Minimum amount of electricity that would be generated with fossil fuels at the

project site in the baseline in year y (MWh) EGPJ,Y = Electricity generated in power plants included in the project boundary in year y

(MWh/yr) EGBL,BR,y = Amount of electricity that would be generated with biomass residues in power-

only plants operated at the project site in the baseline in year y (MWh)

Case 3: Grid connection and historical use of fossil fuels. This case applies if:

(a) At least one power plant included in the project boundary in not an off-grid plant;


(b) Fossil fuels were used for power generation at the project site at any point in time during the most recent three calendar years prior to the implementation of the project activity; and

(c) The baseline scenario is the continued use of fossil fuels for power generation at the project site either in existing or new (co-fired) power plant(s) at the project site which is/are (co-)fired with fossil fuels.

Case 4: Grid connection, no historical use of fossil fuels and construction of a new power plant (co-)fired with fossil fuels in the baseline scenario.

This case applies if:

(a) At least one power plant included in the project boundary is not an off-grid plant;

(b) No fossil fuels were used for power generation at the project site during the most recent three years prior to the implementation of the project activity; and

(c) The baseline scenario is the construction of new power plant(s) at the project site which is/are (co-)fired with fossil fuels.

No fossil fuels would be used for electricity generation in the baseline scenario; Case 1 is the case of the proposed project, so

EGBL,FF,y = 0

Step 1.5: Determination of EGBL,grid,y

The minimum amount of electricity that would be generated by power plants in the electricity grid in the baseline (EGBL,grid,y) should, in accordance with the baseline scenario, be determined as follows:

Case 1: No connection to the electricity grid. If all power plants included in the project boundary are off-grid power plants, then the project does not displace grid electricity and EGBL,grid,y = 0.

Case 2: No electricity generation at the project site in the baseline. If no power plants would be operated at the project site in the baseline, then all electricity generated by the project displaces grid electricity and EGBL,grid,y = EGPJ,y.

Case 3: Use of only biomass residues for electricity generation at the project site in the baseline. If only biomass residues and no fossil fuels would be used for electricity generation at the project site in the baseline, then the electricity generated by the project displaces grid electricity and electricity generated with biomass residues (EGPJ,y = EGBL,grid,y + EGBL,BR,y). Accordingly, EGBL,grid,y is calculated as follows:

Where: EGBL,grid,y = Minimum amount of electricity that would be generated by power plants in the

electricity grid in the baseline in year y (MWh/yr) EGPJ,Y = Electricity generated in power plants included in the project boundary in year y

(MWh/yr) EGBL,BR,y = Amount of electricity that would be generated with biomass residues in power-

only plants operated at the project site in the baseline in year y (MWh/yr)

Case 4: Use of only fossil fuels for electricity generation at the project site in the baseline. If only fossil fuel and no biomass residues would be used for electricity generation at the project site in


the baseline, then the electricity generated by the project can displace grid electricity and electricity generated with fossil fuels at the project site.

Case 5: Use of fossil fuels and biomass residues for electricity generation at the project site in the baseline. If biomass residues and fossil fuels would be used for electricity generation at the project site in the baseline, then the electricity generated by the project can displace grid electricity, electricity generated with fossil fuels at the project site and electricity generated with biomass residues at the project site.

In the proposed project, Case 2 is chosen as there was no electricity generation at the project site in the baseline, so

EGBL,grid,y = EGPJ,y

Step 1.6: Determination of EGBL,FF/grid,y

EGBL,FF/grid,y represents the amount of electricity that could be generated in the baseline in the grid or at the project site using fossil fuels. EGBL,FF/grid,y corresponds to the remainder of electricity generation, i.e. the amount that exceeds the minimum amount of electricity that would be generated by power plants in the electricity grid (EGBL,grid,y), the minimum amount of electricity that could be generated with fossil fuels at the project site (EGBL,FF,y), and the amount of electricity that would be generated with biomass residues at the project site (EGBL,BR,y). Accordingly, EGBL,FF/grid,y is calculated as follows:

(6)

Where: EGBL,FF/grid,y = Amount of electricity that could be generated in the baseline either by power

plants in the electricity grid or by power plants at the project site using fossil fuels in year y (MWh)

EGPJ,y = Electricity generated in power plants included in the project boundary in year y (MWh)

EGBL,BR,y = Amount of electricity that would be generated with biomass residues in power-only plants operated at the project site in the baseline in year y (MWh)

EGBL,FF,y = Minimum amount of electricity that would be generated with fossil fuels at the project site in the baseline in year y (MWh)

EGBL,grid,y = Minimum amount of electricity that would be generated by power plants in the electricity grid in the baseline in year y (MWh)

As dedicated above, EGBL,BR,y = 0, EGBL,FF,y = 0, EGBL,grid,y = EGPJ,y

Step 1.7: Determination of EFBL,FF,y

EFBL,FF,y should be determined using option A or option B below. If fossil fuel power plants were operated at the project site prior to the implementation of the project activity, either option A or option B can be used to determine EFBL,FF,y. For new power plants that would be constructed at the project site in the baseline scenario, Option B should be used.

Option A: Determine EFBL,FF,y as per the procedure described under “Scenario B: Electricity consumption from an off-grid captive power plant” in the latest approved version of the “Tool to calculate baseline, project and/or leakage emissions from electricity consumption”, using data from the three calendar years prior to the implementation of the project activity.

UNFCCC/CCNUCC CDM – Executive Board Option B: Determine a default emission factor for EFBL,FF,y based on a default efficiency of the

power plant that would be operated at the project site in the baseline and a default CO2 emission factor for the fossil fuel types that would be used, as follows:

(7)

Where: EFBL,FF,y = CO2 emission factor for electricity generation with fossil fuels in power

plant(s) at the project site in the baseline in year y (t CO2 / MWh)

EFBL,CO2,FF = CO2 emission factor of the fossil fuel type that would be used for power generation at the project site in the baseline (t CO2/GJ)

ηBL,FF = Efficiency of the fossil fuel power plant(s) at the project site in the baseline

According to the analysis of baseline scenario in section B.4, the project is a newly built power-only project and no power plants were or would be operated at the project site prior to the implementation of the project in the baseline scenario, then it is not applicable.

Step 1.8: Determination of EFgrid,CM,y

EFgrid,CM,y should be determined as the combined margin CO2 emission factor for grid connected power generation in year y, calculated using the latest approved version of the “Tool to calculate the emission factor for an electricity system”. Calculation of Combined Margin baseline emission factor of the North China Grid Step 1.8.1: Identify the relevant electric power system

For determining the electricity emission factors, identify the relevant project electricity system.

Similarly, identify any connected electricity systems.

If the DNA of the host country has published a delineation of the project electricity system and connected electricity systems, these delineations should be used.

Since Chinese DNA has published a delineation of the project electricity system and connected electricity systems9, these delineations should be applied for the proposed project. According to the delineations, the North China Grid is identified as the relevant electric power system of the proposed project, which includes the grids of Beijing, Tianjin, Hebei, Shanxi, Shandong and Inner Mongolia. The proposed project belongs to the Hebei Power Grid, which is part of North China Grid.

Step 1.8.2: Choose whether to include off-grid power plants in the project electricity system (optional) Project participants may choose between the following two options to calculate the operating margin and build margin emission factor:

Option I: Only grid power plants are included in the calculation.

Option II: Both grid power plants and off-grid power plants are included in the calculation.

9 http://cdm.ccchina.gov.cn/WebSite/CDM/UpFile/File2720.pdf

UNFCCC/CCNUCC CDM – Executive Board Option I is selected to calculate to calculate the operating margin and build margin emission factor as no off-grid was involved in the baseline.

Step 1.8.3: Select a method to determine the operating margin (OM)

The calculation of the operating margin emission factor (EFgrid,OM,y ) is based on one of the following methods:

(a) Simple OM, or (b) Simple adjusted OM, or (c) Dispatch data analysis OM, or (d) Average OM.

The simple OM method (option a) can only be used if low-cost/must-run resources constitute less than 50% of total grid generation in: 1) average of the five most recent years, or 2) based on long-term averages for hydroelectricity production. The dispatch data analysis (Option c) cannot be used if off-grid power plants are included in the project electricity systems as per Step 1.8.2 above. Method (a) Simple OM is applied because low-cost / must run resources constitute less than 50% of total grid generation in average of the five most recent years. From 2006 to 2010 respectively, 0.74%, 0.75%, 1.12%, 2.25% and 3.13% of the electricity generated in the NCG came from low-cost / must run resources10. Ex ante option of the simple OM was chose to determine the emission factor. As requirements of the CDM tools “Tool to calculate the emission factor for an electricity system” (Version 03.0.0), a 3-year generation-weighted average from 2008 to 2010 available in China Energy Statistics Yearbooks 2008-2010 and the China Electric Power Yearbooks 2008-2010. This data vintage remains fixed during the crediting period. Step 1.8.4: Calculate the operating margin emission factor according to the selected method The Simple OM emission factor is calculated as the generation-weighted average CO2 emissions per unit net electricity generation (tCO2/MWh) of all generating power plants serving the system, not including low-cost / must-run power plants / units. The simple OM may be calculated by one of the following options: Option A: Based on the net electricity generation and a CO2 emission factor of each power plant; or Option B: Based on the total net electricity generation of all power plants serving the system and the fuel types and total fuel consumption of the project electricity system. Option B can only be used if: (a) The necessary data for Option A is not available; and (b) Only nuclear and renewable power generation are considered as low-cost/must-run power sources and the quantity of electricity supplied to the grid by these sources is known; and (c) Off-grid power plants are not included in the calculation (i.e., if Option I has been chosen in Step 1.8.2). 10 China Electric Power Yearbooks 2007-2011

UNFCCC/CCNUCC CDM – Executive Board For the proposed project activity, the required data for the practice of Option A are not available and those of Option B can be obtained from official sources. Meanwhile, nuclear and renewable power generation is considered as low-cost / must-run power sources and the quantity of electricity supplied to the grid by these sources is known. Off-grid power plants are not included in the calculation. Therefore, Option B is chosen to calculate the operating margin emission factor: Option B- calculation based on total fuel consumption and electricity generation of the system The formula is

€

EFgrid ,OMsimple,y =FCi,y × NCVi,y × EFCO2,i,yi

∑EGy

(2)

Where: EFgrid,OMsimple,y = Simple operating margin CO2 emission factor in year y (tCO2/MWh)

FCi,y = Amount of fuel type i consumed in the project electricity system in year y (mass or volume unit)

NCVi,y = Net calorific value (energy content) of fuel type i in year y (GJ / mass or volume unit)

EFCO2,i,y = CO2 emission factor of fuel type i in year y (tCO2/GJ)

EGy = Net electricity generated and delivered to the grid by all power sources serving the system, not including low-cost / must-run power plants / units, in year y (MWh)

i = All fuel types combusted in power sources in the project electricity system in year y

y = The relevant year as per the data vintage chosen in Step 1.8.3

Given the above, the simple operating margin CO2 emission factor (EFgrid,OMsimple,y) of North China Grid is 1.00211 tCO2/MWh. The detailed calculations and data are listed in the Appendix 4.

Step 1.8.5. Calculate the build margin (BM) emission factor In terms of vintage of data, project participants can choose between one of the following two options: Option 1: For the first crediting period, calculate the build margin emission factor ex-ante based on the most recent information available on units already built for sample group m at the time of CDM-PDD submission to the DOE for validation. For the second crediting period, the build margin emission factor should be updated based on the most recent information available on units already built at the time of submission of the request for renewal of the crediting period to the DOE. For the third crediting period, the build margin emission factor calculated for the second crediting period should be used. This option does not require monitoring the emission factor during the crediting period. Option 2: For the first crediting period, the build margin emission factor shall be updated annually, ex post, including those units built up to the year of registration of the project activity or, if information up to the year of registration is not yet available, including those units built up to the latest year for which information is available. For the second crediting period, the build margin emissions factor shall be calculated ex ante, as described in Option 1 above. For the third crediting period, the build margin emission factor calculated for the second crediting period should be used. The project proponents have chosen to use the option 1 to calculate the build margin emission factor, and EFgrid,BM,y is fixed for the duration of the first crediting period.

UNFCCC/CCNUCC CDM – Executive Board The build margin emission factor is the generation-weighted average emission factor (tCO2/MWh) of all power units m during the most recent year y for which power generation data is available, calculated as follows:

(2)

Where: EFgrid,BM,y = Build margin CO2 emission factor in year y (tCO2 /MWh)

EGm,y = Net quantity of electricity generated and delivered to the grid by power unit m in year y (MWh)

EFEL,m,y = CO2 emission factor of power unit m in year y (tCO2 /MWh)

m = Power units included in the build margin

y = Most recent historical year for which power generation data is available

Currently, it is very difficult to get the capacity margin data of power plants in China, since these data as well as net quantity of electricity generated and delivered to the grid and fuel consumption data in power unit m are regarded as commercial secrets or only for internal usage. Then the following deviation11 approved by the EB was adopted to calculate the Build Margin emission factor. According to the guidance from the CDM Executive Board for a deviation of the baseline methodology of AM0005, which had combined into the baseline methodology of ACM0002, the following deviation was adopted to calculate the Build Margin emission factor. 1) Use the efficiency level of the best technologies commercially available in the provincial/regional or national grid of China, as a conservative proxy, for fuel i consumption estimation to estimate the EFgrid,BM,y. 2) Use capacity additions during last several years for estimating the EFgrid,BM,y, i.e. the capacity addition over last several years, whichever results in a capacity addition that is closest to 20% of total installed capacity. For the proposed project, the data from Year 2008 to 2010 is used to calculate EFgrid,BM,y 3) Use installed capacity to replace annual power generation to estimate weights. Deviated Calculation of Build Margin (BM) Sub-step 1. Calculation of weights of CO2 emissions of solid, liquid and gaseous fossil fuels in total emissions for power generation:

11 http://cdm.unfccc.int/UserManagement/FileStorage/AM_CLAR_QEJWJEF3CFBP1OZAK6V5YXPQKK7WYJ.


Where: FCi,j,y = Amount of fuel type i consumed by power sources j in year y (mass or volume unit) NCVi,y = Net calorific value (energy content) of fuel type i in year y (GJ/t or GJ/m3) EFCO2,i,y = CO2 emission factor of fuel type i in year y (tCO2 /GJ) COAL, OIL and GAS refer to the group of solid, liquid, and gaseous fuels, respectively. Sub-step 2: Calculation of Emission Factor of Relevant Thermal Power

Where: EFCoal,Adv,y, EFOil,Adv,y and EFGas,Adv,y refer to the emission factors representing best technologies commercially available for coal, oil and gas fired power plants, respectively. Sub-step 3: Calculation of BM of the Grid

Where: CAPTotal,y = The total newly added electricity generation capacity (MW) CAPThermal,y = The newly added electricity generation capacity of thermal power (MW) Following the five steps above, the build margin emission factor EFgrid,BM,y of the Northeast China Power Grid is calculated to be: 0.5940 tCO2/MWh. The detailed calculations and data are listed in the Appendix 4. Sub-step 6. Calculate the combined margin emission factor The combined margin (CM) emission factor (EFgrid,CM,y) is calculated as follows:

(8) Where:

UNFCCC/CCNUCC CDM – Executive Board EFgrid,BM,y = Build margin CO2 emission factor in year y (tCO2/MWh)

EFgrid,OM,y = Operating margin CO2 emission factor in year y (tCO2/MWh)

wOM = Weighting of operating margin emissions factor (%)

wBM = Weighting of build margin emissions factor (%)

For biomass power project activities, wOM = wBM = 0.5 for the first crediting period. Therefore, the baseline combined emission factor of the Northeast China Power Grid is calculated to be 0.79803 tCO2/MWh. The detailed calculation and data are listed in the Appendix 4. EFgrid,CM,y = 0.5 × 1.0021 + 0.5 × 0.5940 = 0.79803 (tCO2/MWh)

Step 2: Determination of baseline emissions due to uncontrolled burning or decay of biomass residues (BEBR,y) As per ACM0018 (version 02.0.0), the calculation of the baseline emissions due to uncontrolled burning or decay of biomass residues is optional, and the project participant of the proposed project decided to exclude these emission sources. Therefore, this section does not need to be applied and project emissions do not need to include emissions from the combustion of biomass residues under the project activity. Project Emissions

According to the ACM0018 (version 02.0.0), the project emissions are calculated as follows:

(8)

Where: PEy = Project emissions during year y (tCO2e) PEFF,y = Emissions during the year y due to fossil fuel consumption (tCO2) PEEL,y = Emissions during the year y due to electricity use off-site for the processing of biomass

residues (tCO2) PETR,y = Emissions during the year y due to transport of the biomass residues to the project plant

(tCO2) PEBR,y = Emissions from the combustion of biomass residues during the year y (tCO2e) PEWW,y = Emissions from waste water generated from the treatment of biomass residues in year y

(tCO2e)

Determination of PEFFy

The following emission sources should be included in determining PEFF,y:

• Emissions from on-site fossil fuel consumption for the generation of electric power. This includes all fossil fuels used at the project site in heat generators (e.g. boilers) for the generation of electric power; and

• Emissions from on-site fossil fuel consumption of auxiliary equipment and systems related to the generation of electric power. This includes fossil fuels required for the operation of auxiliary equipment related to the power plants (e.g. for pumps, fans, cooling towers, instrumentation and control, etc.) which are not accounted in the first bullet; and

• Fossil fuels required for the operation of equipment related to the on-site or off-site preparation, storage, processing and transportation of fuels and biomass residues (e.g. for mechanical treatment of the biomass, conveyor belts, driers, pelletization, shredding, briquetting processes, etc.).


• If any fossilized or non-biodegradable materials are used in the processing of biomass residues and incorporated in the processed biomass residues (e.g. binders) then emissions arising from those materials should be accounted for when the processed biomass residues are combusted. For that purpose those materials should be deemed as fossil fuels. If net calorific values, carbon content and/or emission factors of those materials are available they could be used, otherwise the net calorific values, carbon content and/or emission factors of the most carbon intensive fossil fuel available in the country should be used.

The latest approved version of the “Tool to calculate project or leakage CO2 emissions from fossil fuel combustion” should be used to calculate PEFF,y. All combustion processes j as described in the two bullets above should be included.

CO2 emissions from fossil fuel combustion in process j are calculated based on the quantity of fuels combusted and the CO2 emission coefficient of those fuels, as follows:

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PEFF ,y = PEFC , j,y = FCi, j ,y × COEFi,yi∑

Where:

PEFC,j,y = Are the CO2 emissions from fossil fuel combustion in process j during the year y (tCO2/yr)

FCi,j,y = Is the quantity of fuel type i combusted in process j during the year y (mass or volume unit/yr)

COEFi,y = Is the CO2 emission coefficient of fuel type i in year y (tCO2/mass or volume unit)

i = Are the fuel types combusted in process j during the year y

The CO2 emission coefficient COEFi,y can be calculated using one of the following two Options, depending on the availability of data on the fossil fuel type i, as follows:

Option A: The CO2 emission coefficient COEFi,y is calculated based on the chemical composition of the fossil fuel type i.

Option B: The CO2 emission coefficient COEFi,y is calculated based on net calorific value and CO2 emission factor of the fuel type i.

As the necessary data of option A is not available, Option B is chosen to determine COEFi,y in the PDD as follows:

Where:

COEFi,y = Is the CO2 emission coefficient of fuel type i in year y (tCO2/mass or volume unit)

NCVi,y = Is the weighted average net calorific value of the fuel type i in year y (GJ/mass or volume unit)

EFCO2,i,y = Is the weighted average CO2 emission factor of fuel type i in year y (tCO2/GJ)

i = Are the fuel types combusted in process j during the year y

UNFCCC/CCNUCC CDM – Executive Board Determination of PEEL,y

Emissions should be included that result from the generation of electric power required for the operation of equipment related to the off-site preparation, processing, storage and transportation of biomass residues (e.g. for mechanical treatment of the biomass, conveyor belts, driers, pelletization, shredding, briquetting processes, etc.). The latest approved version of the “Tool to calculate baseline, project and/or leakage emissions from electricity consumption” should be used to calculate PEEL,y. Note that the electric power used on-site for the purposes described above are already accounted as part of EGPJ,aux,y. PEEL,y should account thus only for the off-site use of electricity. The off-site mechanical processing of the biomass residues would be considered in the PDD. For the project, the cotton stalk should be shredded into small pieces and part of the corn and wheat stalk should be packaged into bundles in offsite sites by machines before transport to the power plant and combustion. So electricity is needed for biomass residue processing. All the electricity consumption of the off-site biomass processing machines are grid electricity, and the highest power consumption rate (kWh/tonnes biomass) would be chosen for ex ante calculation of the project emission PEEL,y as follows, and the actual electricity consumed will be monitored ex-post:

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PEEL ,y = PEEC ,y = ECPJ , j,y × EFEL, j ,y × (1+TDL j,y )j∑

Where:

PEEL,y = Emissions during the year y due to electricity use off-site for the processing of biomass residues (tCO2e)

PEEC,y = Project emissions from electricity consumption in year y (tCO2/yr)

ECPJ,j,y = Quantity of electricity consumed by the project electricity consumption source j in year y (MWh/yr)

EFEL,j,y = Emission factor for electricity generation for source j in year y (tCO2e/MWh)

TDLj,y = Average technical transmission and distribution losses for providing electricity to source j in year y

j = Sources of electricity consumption in the project

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ECPJ , j,y = BRP , j ,yi∑ × ECFMax

Where:

ECPJ,j,y = Quantity of electricity consumed by the project electricity consumption source j in year y (MWh/yr)

BRP,i,y = Quantity of biomass residues type i that need processing in year y (ton)

ECFMax = The maximize emission consumption factor for all the biomass processing machines used for the project for ex ante calculation (kWh/ton wet mass biomass)

Determination of PETR,y

In cases where the biomass residues are not generated directly at the project site, project participants shall determine CO2 emissions resulting from transportation of the biomass residues to the project plant using the latest version of the tool “Project and leakage emissions from transportation of freight” (Version

UNFCCC/CCNUCC CDM – Executive Board 01.1.0). PETR,m in the tool corresponds to the parameter PETR,y in this methodology and the monitoring period m is one year. As the biomass residues in the project are collected from the nearby area, the emission from the transport is included in the project emission. The tool “Project and leakage emissions from road transportation of freight” provides two options to determine the emissions: Option A: Monitoring fuel consumption; or Option B: Using conservative default values.

Option B was chosen to calculation the PETR,y as following formula from the tool “Project and leakage emissions from road transportation of freight”.

Where: PETR,m = Project emissions from transportation of freight monitoring period m (tCO2) Df,m = Return trip distance between the origin and destination of freight transportation activity f

in monitoring period m (km) FRf,m = Total mass of freight transported in freight transportation activity f in monitoring period

m (t) EFCO2,f = Default CO2 emission factor for freight transportation activity f (g CO2 / t km) f = Freight transportation activities conducted in the project activity in monitoring period m

As the GVM of the trucks used to transport the biomass are lower than 26 tonnes, the default value of light truck of 245 (g CO2 / t km) is used for EFCO2,f .

Determination of PEBR,y According to the ACM0018 (version 02.0.0), if the BEBR,y is not included in calculation of baseline emissions, then the emissions from the combustion of biomass residues need not be included. Therefore, PEBR,y is excluded. Thus, PEBR,y = 0.

Determination of PEWW,CH4,y This emission source should be estimated in cases where waste water originating from the treatment of the biomass is (partly) treated under anaerobic conditions and where methane from the waste water is not captured and flared or combusted. For the proposed project, there is no waste water generated from treatment of biomass, PEWW,CH4,y =0.

Leakage (LEy) The main potential source of leakage for this project activity is an increase in emissions from fossil fuel combustion or other sources due to diversion of biomass residues from other uses to the project plant as a result of the project activity. Changes in carbon stocks in the LULUCF sector are expected to be insignificant since this methodology is limited to biomass residues, as defined in the applicability conditions above. The baseline scenarios for biomass residues for which this potential leakage is relevant are B5, B6, B7 and B8. As only B1 and B3 is the applicable baseline for biomass, leakage could be ignored in PDD. Therefore, LEy = 0

UNFCCC/CCNUCC CDM – Executive Board B.6.2. Data and parameters fixed ex ante

Data / Parameter GWPCH4

Unit tCO2e/tCH4

Description Global warming potential for methane valid for the relevant commitment period

Source of data 2006 IPCC Guidelines for National Greenhouse Gas Inventories

Value(s) applied 21

Choice of data or Measurement methods and procedures

Apply to the first commitment period, shall be updated according to any future COP/MOP decisions

Purpose of data Additional comment -

Data / Parameter Biomass residues categories and quantities used for the selection of the

baseline scenario selection and assessment of additionality Unit • Type (i.e. bagasse, rice husks, empty fruit bunches, etc.);

• Source (e.g. produced on-site, obtained from an identified biomass residues producer, obtained form a biomass residues market, etc.);

• Fate in the absence of the project activity (Scenarios B); • Use in the project scenario (Scenarios P); • Quantity (tonnes on dry-basis)

Description A table similar to Table B-4, which quantities of which biomass residues categories are used in which installation(s) under the project activity and what is their baseline scenario. The last column of Table B-4 corresponds to the quantity of each category of biomass residues (tonnes). For the selection of the baseline scenario and demonstration of additionality, at the validation stage, an ex ante estimation of these quantities should be provided.

Source of data On-site assessment of biomass residues categories and quantities

Value(s) applied See Table B-4 for details


The data are from FSR, and actual one-year data statistics

Purpose of data This parameter is related to the procedure for the selection of the baseline scenario selection and assessment of additionality

Additional comment -


Data / Parameter TDLy

Unit -

Description Average technical transmission and distribution losses for providing electricity in year y

Source of data Tool to calculate baseline, project and/or leakage emissions from electricity consumption (Version 01)

Value(s) applied 20% In case of scenario A, use as default values of 20% for (a) project or leakage electricity consumption sources


Because the data is not available within host country, the default value (20%) can be adopted for project emission calculation according to the Tool to calculate baseline, project and/or leakage emissions from electricity consumption. This is conservative.

Purpose of data Calculation of project emission Additional comment -

Data / Parameter EFCO2,f

Unit g CO2/t km

Description Default CO2 emission factor for freight transportation activity f

Source of data Methodological tool of “Project and leakage emissions from transportation of freight” (Version 01.1.0)

Value(s) applied Vehicle class Emission factor (g CO2/t km) Light vehicles 245


The default value specified in methodological tool

Purpose of data Calculation of project emission Additional comment Applicable to Option B to calculate project emissions from road

transportation of freight


Data / Parameter FCi,y

Unit tonne or m3

Description Amount of fuel type i consumed in the NCG in year y Source of data China Energy Statistical Yearbook (2008~2010)

Value(s) applied See Appendix 4 for details


Official statistical data

Purpose of data Calculation of emission factor Additional comment -

Data / Parameter NCVi,y

Unit GJ/t or GJ/m3

Description Net Calorific Value of fuel type i in year y

Source of data China Energy Statistical Yearbook (2008~2010)





Data / Parameter EFCO2,i,y

Unit tCO2/GJ

Description CO2 emission factor of fuel type i in year y Source of data 2006 IPCC Guidelines for National Greenhouse Gas Inventories Value(s) applied See Appendix 4 for details Choice of data or Measurement methods and procedures

The lower limit of the uncertainty at a 95% confident interval of IPCC default value



Data / Parameter Carbon Oxidation Factor (OXID)

Unit %

Description Carbon Oxidation Factor of fossil fuel type i consumed by the power plants in the Northeast China Grid

Source of data 2006 IPCC Guidelines for National Greenhouse Gas Inventories



IPCC default value


Data / Parameter Electricity Generation

Unit MWh

Description The electricity generation of the power plants in the Northeast China Power Grid in the year y

Source of data China Electric Power Yearbook (2008~2010)





Data / Parameter Electricity self-consumption ratio

Unit %

Description The ratio of electricity self-consumption to the total electricity generation of the power plants

Source of data China Electric Power Yearbook (2008~2010)






Data / Parameter EFCoal,Adv,y EFOil,Adv,y EFGas,Adv,y

Unit tCO2/MWh

Description Emission factors representing best technologies commercially available for coal, oil and gas fired power plants, respectively

Source of data 2012 Baseline Emission Factors for Regional Power Grids in China Value(s) applied 0.7926

0.5234 0.3764


The value is from the public data of Chinese DNA, which was calculated according to the latest version of Tool to calculate the emission factor for an electricity system.


B.6.3. Ex ante calculation of emission reductions >> In line with Section B3, the emission reduction of the proposed project is calculated as following: Baseline Emissions (BEy) Baseline emissions from electricity generation (BEEL,y) The proposed project applies ex-ante emission factor. The parameters and calculations of Baseline Emissions from electricity generation are as follows:

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BEEL ,y = EGPJ ,y ⋅ EFBL ,EL,y Parameter Value Unit Source Installed capacity 30 MW FSR Annual operation hours 7,300 h FSR Self consumption rate 11.5% - FSR EGPJ,y = 30MW*7,300h*(1-11.5%) = 193,815 MWh Parameter BEEL,y

EGPJ,y EFBL,EL,y Value 154,670 tCO2e 193,815 MWh 0.79803 tCO2e/MWh Source Calculated FSR Annex 3 of PDD Therefore: BEy = BEEL,y Baseline Emissions (BEy) Parameter BEy

UNFCCC/CCNUCC CDM – Executive Board Value 154,670 tCO2e

Project Emissions (PEy)

Emissions during the year y due to fossil fuel consumption (PEFF,y)

Parameter PEFF,y FCi,j,y NCVi,y EFCO2,i,y Value 0 tCO2e 0 t 43.3 (GJ/ton) 0.0748 (tCO2/GJ) Source Calculated - China Energy Statistical Yearbook IPCC As there is no any fossil fuel consumption data source by now, so FCi,j,y is assumed to be 0 tonne at validation stage. The actual record would be applied to ER calculation during verification. Emissions during the year y due to electricity use off-site for the processing of biomass residues (PEEL,y)

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PEEC ,y = ECPJ , j,y × EFEL, j ,y × (1+TDL j,y )j∑

Biomass wet weight (t) 300000 Processing power consumption (kWh/ton) 15 Total power consumption ECBP,y (MWh) 4500

Parameter PEEL,y ECPJ,j,y EFEL,j,y TDLj,y

Value 4309 tCO2e 4500 MWh 0.79803 tCO2e/MWh 20% Source Calculated Table above Annex 3 of PDD Tool to calculate baseline,

project and/or leakage emissions from electricity consumption

Emissions during the year y due to transport of the biomass residues to the project plant (PETR,y)

Parameter PETR,y Df,m FRf,m EFCO2,f

Value 7350 tCO2e 100 km 300000 t 245 gCO2/t km Source Calculated Conservative

value from project record

FSR Tool “Project and leakage emissions from transportation of freight”

Project Emissions estimate (PEy) Parameter PEy PEFF,y PEEL,y PETR,y PEBR,y PEWW,y Value 11659 tCO2e 0 4309 tCO2e 7350 tCO2e 0 tCO2e 0 tCO2e

Leakage (LEy)

UNFCCC/CCNUCC CDM – Executive Board LEy=0 tCO2e Emission Reductions (ERy) Parameter ERy BEy PEy LEy

Value 143,010 tCO2e 154,670 tCO2e 11,659 tCO2e 0 tCO2e B.6.4. Summary of ex ante estimates of emission reductions Table B-14 Summary of ex ante estimates of emission reductions

Year Baseline emissions (t CO2e)

Project emissions (t CO2e)

Leakage (t CO2e)

Emission reductions (t CO2e)

2011 154,670 11,659 0 143,010 2012 154,670 11,659 0 143,010 2013 154,670 11,659 0 143,010 2014 154,670 11,659 0 143,010 2015 154,670 11,659 0 143,010 2016 154,670 11,659 0 143,010 2017 154,670 11,659 0 143,010 Total 1,082,691 81,616 0 1,001,070 Total number of first crediting years 7 Annual average over the crediting period 154,670 11,659 0 143,010

UNFCCC/CCNUCC CDM – Executive Board B.7. Monitoring plan B.7.1. Data and parameters to be monitored

Data / Parameter Biomass residues categories and quantities used in the project activity Data Unit • Type (i.e. bagasse, rice husks, empty fruit bunches, etc.);

• Source (e.g. produced on-site, obtained from an identified biomass residues producer, obtained from a biomass residues market, etc.);

• Fate in the absence of the project activity (scenario B); • Use in the project scenario (scenario P); • Quantity (tonnes on dry-basis)

Description A table similar to Table B-4 will be used to record which quantities of which biomass residues categories are used in which installation(s) under the project activity and what is their baseline scenario. These quantities will be updated every year of the crediting period as part of the monitoring plan so as to reflect the actual use of biomass residues in the project scenario. These updated values will be used for emissions reductions calculations. Along the crediting period, new categories of biomass residues (i.e. new types, new sources, with different fate) can be used in the project activity. In this case, a new line should be added to the table. If those new categories are of the type B1:, B2: or B3:, the baseline scenario for those types of biomass residues should be assessed using the procedures outlined in the guidance provided in the procedure for the selection of the baseline scenario and demonstration of additionality

Source of data The data from FSR will be used for ex-ante calculation; The data from on-site measurements will be used for ex-post calculation.

Value(s) applied 300,000 tonnes for ex-ante emission reductions calculation Measurement methods and procedures

Use weight meters. Adjust for the moisture content in order to determine the quantity of dry biomass

Monitoring frequency Data monitored continuously and aggregated as appropriate, to calculate emission reductions

QA/QC procedures Crosscheck the measurements with an annual energy balance that is based on purchased quantities and stock changes

Purpose of data Calculation of project emissions Additional comment -


Data / Parameter EGPJ,gross,y Unit MWh Description Gross quantity of electricity generated in all power plants which are located

at the project site and included in the project boundary in year y Source of data On-site measurements Value(s) applied 219,000 Measurement methods and procedures

Use calibrated electricity meters. Accuracy of the meter will be no lower than 0.5s. The metering equipment will be properly calibrated and checked annually for accuracy according to national standards.

Monitoring frequency Data monitored continuously and aggregated as appropriate, to calculate emission reductions

QA/QC procedures The consistency of metered electricity generation should be cross-checked with receipts from electricity sales (if available)

Purpose of data Calculation of baseline emissions Additional comment Actually, the monitored electricity is probably the net electricity delivered

by the project, that is, the self-consumption electricity is deducted from the electricity generated, and the net electricity could be monitored directly by a meter installed on site or in the grid-side.

Data / Parameter EGPJ,aux,y

Unit MWh Description Total auxiliary electricity consumption required for the operation of the

power plants at the project site Source of data On-site measurements Value(s) applied 25,185 (219,000*11.5%) Measurement methods and procedures


Monitoring frequency Data monitored continuously and aggregated as appropriate, to calculate emissions reductions


Purpose of data Calculation of baseline emissions Additional comment EGPJ,aux,y shall include all electricity required for the operation of

equipment related to the preparation, storage and transport of biomass residues (e.g. for mechanical treatment of the biomass, conveyor belts, driers, etc.) and electricity required for the operation of all power plants which are located at the project site and included in the project boundary (e.g. for pumps, fans, cooling towers, instrumentation and control, etc.) Actually, the monitored electricity is probably the net electricity delivered by the project, that is, the self-consumption electricity is deducted from the electricity generated, and the net electricity could be monitored directly by a meter installed on site or in the grid-side.


Data / Parameter EGPJ,y

Unit MWh Description Net quantity of electricity generated in all power plants which are located

at the project site and included in the project boundary in year y Source of data On-site measurements Value(s) applied 193,815 Measurement methods and procedures


Monitoring frequency Data monitored continuously and aggregated as appropriate, to calculate emissions reductions


Purpose of data Calculation of baseline emissions Additional comment -

Data / Parameter Df,m

Unit Kilometre Description Return trip road distance between the origin and destination of freight

transportation activity f in monitoring period m Source of data Records of vehicle operator or records by project participants Value(s) applied 100

Measurement methods and procedures

Determined once for each freight transportation activity f for a reference trip using the vehicle odometer or any other appropriate sources

Monitoring frequency To be updated whenever the road distance changes QA/QC procedures - Purpose of data Calculation of project emission Additional comment Applicable to Option B to calculate project emissions from road



Data / Parameter FRf,m

Unit tonnes Description Total mass of freight transported in freight transportation activity f in

monitoring period m Source of data Records by project participants or records by truck operators Value(s) applied 300,000 from FSR for ex-ante calculation of project emissions

Measurement methods and procedures

-

Monitoring frequency Continuously QA/QC procedures - Purpose of data Calculation of project emission Additional comment Applicable to Option B to calculate project emissions from road


Data / Parameter FCi,j,y Unit Mass or volume unit per year (e.g. ton/yr or m3/yr) Description Quantity of fuel type i combusted in process j during the year y Source of data On-site record Value(s) applied Assumed to be 0 at validation stage as lack of accurate data. Measurement methods and procedures

Use either mass or volume meters. Any type of fossil fuel consumption in the Power Plant will be continuously monitored and recorded. The data will be crosschecked by purchasing receipts. Data will be archived 2 years following the end of the crediting period.

Monitoring frequency Continuously QA/QC procedures Cross-check the measurements with an annual balance that is based on

purchased quantities and stock changes Purpose of data Calculation of project emission Additional comment -


Data / Parameter NCVi,y Unit GJ / mass or volume unit Description Weighted average net calorific value of the fuel type i in year y. Source of data IPCC default values at the upper limit of the uncertainty at a 95%

confidence interval as provided in Table 1.2 of Chapter 1 of Vol. 2 (Energy) of the 2006 IPCC Guidelines on National GHG Inventories

Value(s) applied 43.3 GJ/t for diesel oil in ex-ante calculation Measurement methods and procedures

-

Monitoring frequency Any update of IPCC Guidelines in future will be followed. QA/QC procedures - Purpose of data Calculation of project emission Additional comment Since Option a) on “Tool to calculate project or leakage CO2 emissions

from fossil fuel combustion” is not available, Option d) is selected for this parameter.

Data / Parameter EFCO2,i,y Unit tCO2/GJ Description Weighted average CO2 emission factor of fuel type i consumed in year y Source of data IPCC default values at the upper limit of the uncertainty at a 95%

confidence interval as provided in Table 1.4 of Chapter 1 of Vol. 2 (Energy) of the 2006 IPCC Guidelines on National GHG Inventories

Value(s) applied 0.0748 tCO2/GJ for diesel oil in ex-ante calculation Measurement methods and procedures

-

Monitoring frequency Any update of IPCC Guidelines in future will be followed. QA/QC procedures - Purpose of data Calculation of project emission Additional comment -

B.7.2. Sampling plan >> 1. Introduction of Monitoring Plan This Monitoring plan will set out a number of monitoring tasks in order to ensure that all aspects of projected greenhouse gas (GHG) emission reductions for the proposed project are controlled and reported. This requires an ongoing monitoring of the project to ensure performance according to its design and that claimed emission reductions are actually achieved. The monitoring plan of the proposed project is a guidance document that provides the set of procedures for preparing key project indicators, tracking and monitoring the impacts of the proposed project. The monitoring plan will be used throughout the defined crediting period for the project to determine and provide documentation of GHG emission impacts from the proposed project. This monitoring plan fulfils the requirement set out by the Kyoto Protocol that emission reductions projects have real, measurable and long-term benefits and that the reductions in emissions are additional to any that would occur in the absence of the certified project activity. The monitoring plan provides the requirements and instructions for:

UNFCCC/CCNUCC CDM – Executive Board • Establishing and maintaining the appropriate monitoring systems for electricity generated by the

project; • Quality control of the measurements; • Procedures for the periodic calculation of GHG emission reductions; • Assigning monitoring responsibilities to personnel; • Data storage and filing system; 2 Management of the Monitoring Plan & Procedure 2.1 Staffs training To ensure the successful implementation of the monitoring plan, the staffs responsible for equipments operation, data recording, documents storage etc. should be trained to meet their positions. This program includes the operational training, the equipment maintenance training, the data management training, the examining and repairing training and etc, which is able to ensure the successful operation and the data & documents management. 2.2 Monitoring structure National Bio Energy Co., Ltd. will conduct monitoring procedures according to the monitoring methodology chosen for this project activity. This monitoring methodology will enable the recording of emission reductions and leakage effects in an accurate and conservative manner. National Bio Energy Co., Ltd. appoints on-site staff (at the project activity site), who will be in charge of gathering and registering all the required information described in the monitoring plan. Such duties will be included into the routine work of the operators to ensure continuity and high-quality standards. The information will be partially processed and stored there, and will be sent periodically (monthly) to National Bio Energy Co., Ltd. headquarter in Beijing for final processing (table formats, reports, etc.). The responsibilities for carrying out these tasks are broadly elaborated in below.

Figure B-2 the main framework for application of monitoring Operating Manager of the plant: overall management of the implementation of the monitoring plan and quality control of data and records. Head of Biomass management department: straw collection and summarizing the data collected at the collection stations in terms of types, amount, transportation record etc. of biomass residues. Ensuring the biomass at the sites will not be stored over half year. Engineering Department of the plant: in charge of the monitoring of electricity meters and calibration,

Application of monitoring

Data management system CDM working group

Data reporting

Data checking

Data docum

enting

Data m

anagement

working group

Verification

working group

UNFCCC/CCNUCC CDM – Executive Board biomass consumption and NCV of each kind of biomass, fossil fuel consumption within the power plant including boilers, crashing machines, etc, as well as maintenance of equipments. Procurement Dept. of the plant: cross checking the monitoring records with receipt and procurement records. 3. Meter Installation The meters installed at transformer substation are used to monitor net electricity delivered to the grid and auxiliary electricity consumption required for the operation of the power plants. There are two systems for meters operation and maintenance. One is equipped in the outlet of the 110KV main transformer in project site (the main meter M1), the other (the back-up meter M2) is held by the grid company. The two sides have the rights to record the two meters data. North China Power Grid should provide the main meters system data to the project owner every month. 4. Calibration of Meters & Metering 4.1 Electricity meters An agreement should be signed between the project owner and the Grid that defines the metering arrangements and the required quality control procedures to ensure accuracy. The accuracy of the electricity meters will be no lower than 0.5s. The metering equipment will be properly calibrated and checked annually for accuracy according to national standards. The project owner will prepare backup procedures to deal with any errors occurred to the meters. In case of any errors happen, the grid-connected electricity generated by the proposed project shall be determined by the project owner and the Grid jointly according to the error handling procedures. Calibration is carried out by the third party designated with the records being provided to the project owner, and these records will be maintained by the project owner. 4.2 Electricity input meter Following the same process as listed in 4.1. 4.3 Biomass residues consumption The project owner will conduct an energy balance analysis to verify the amounts of biomass residues collected at the collection sites, purchased at biomass procurement department of the power plant and combusted by the boilers. If significant difference among the three sources identified, the project owner will conduct further check the original records to find out reasons and correct. If the significant difference can’t be resolved, the most conservative value of biomass utilized by the proposed project will be applied as monitoring results. 5. Monitoring 5.1 Electricity Generated Grid-connected electricity generated by the proposed project will be monitored through metering equipment at the substation (interconnection facility connecting the facility to the Grid). The data can also be monitored and recorded at the on-site control centre using a computer system. The meter reading will be readily accessible for DOE. Calibration tests records will be maintained for verification. 5.2 Availability of Biomass Residues The project owner will provide evidence to DOE concerning with the availability of Biomass residues resource in the nearby counties. This will be obtained from official information yearly. If it is not

UNFCCC/CCNUCC CDM – Executive Board available, the data will be calculated or estimated based on a survey conducted by project owner yearly. 5.3 Biomass Residues Consumption of the Power Plant The quality and type of biomass residues burned by the power plant will be monitored during the operation of the power plant, including all the necessary parameters of the biomass residues to be monitored according to Section B.7 of this PDD. All relevant records will be maintained for verification. 5.4 Fossil Fuel Consumption by the boiler Fossil Fuel Consumption by the boiler during the operation will be recorded and monitored during the operation period of the proposed project. All relevant records will be maintained for verification. 5.5 Transportation of Biomass residues The project owner of the proposed project will set up a recording and monitoring system within the biomass residues supply and management system with witch the quantity and type of biomass, transportation vehicle and transportation distance to the collection sites will be recorded. The receipts and records regarding with biomass purchase by the proposed project will be documented and summarized for verification. The transportation records will be documented and maintained for verification. 5.6 Electricity purchased from the grid The electricity purchased from the grid will be monitored, and the purchase record would also be kept for examination. Calibration tests reports for power peters will be prepared as the requirement of methodology. 5.7 Leakage Consumed biomass types and the quantity that is available in surplus in the counties that defined in Project Boundary will be monitored to check the leakage effect brought by the operation of the proposed project. This will be obtained from official information, such as agriculture statistics and survey of Counties defined within Project Boundary that supply biomass residues to the proposed project. If it is not available, the data will be calculated or estimated based on a survey conducted by official entity. If any leakage occurs during the crediting period, the project owner will determine the parameters in terms of leakage effects according the definition in the PDD with the support from local government entity. 6 Quality assurance and quality control The quality assurance and quality control procedures for monitoring, reading, recording, maintaining and archiving data shall be improved as part of the VER project activity. This is an on-going process that will be ensured through the VER in terms of the need for verification of the emissions according to this PDD and the manual. The project employs high accuracy monitoring and control equipment that will measure, record, report, and monitor and control various key parameters like power generation by the project, auxiliary power consumption, purchased biomass , purchased fossil fuel etc.. Necessary standby meters or check meters will be installed, to operate in standby mode when the main meters are not working. All meters will be calibrated and sealed as per the industry practices at regular intervals. Hence, high quality is ensured with the above parameters. Sales records (including electricity supplied and biomass purchased, etc) will be used and kept for checking consistency of the recorded data.

UNFCCC/CCNUCC CDM – Executive Board 7. Data Management System This provides information on record keeping of the data collected during monitoring activity. Overall responsibility for monitoring of GHG emissions reduction will rest with the VER responsible person of the proposed project. The VER manual sets out the procedures for tracking information from the primary source to the end-data calculations in paper document format. Electronic data and documents, including readings from electric meters connected into the computer central control system, will be regularly backup and kept at lease two years after the end of the crediting period. Written data and documents, including receipts for crosschecking of data, will be kept at least two years after the end of the crediting period. B.7.3. Other elements of monitoring plan >> N/A

SECTION C. Duration and crediting period C.1. Duration of project activity C.1.1. Start date of project activity >> 26/10/2010 C.1.2. Expected operational lifetime of project activity >> 25 years C.2. Crediting period of project activity C.2.1. Type of crediting period >> 1st renewable period of renewable credit period type C.2.2. Start date of crediting period >> Two years prior to the registration in the GS. C.2.3. Length of crediting period >> 7 years*3

SECTION D. Environmental impacts D.1. Analysis of environmental impacts >> The Environment Impact Assessment Report of the proposed project was completed in 2009. The conclusions of the analyses and measures to be taken to mitigate the environment impacts have be demonstrate in the following: Air The biomass boiler with the technology from BWE Denmark will be installed by the proposed project. The boiler has employed bag-type dust removers, which will efficiently reduce the soot emission generated during biomass burning. The treated soot will be emitted by chimney that is about 80m at

UNFCCC/CCNUCC CDM – Executive Board height. The output concentrations from chimney for the soot emission, SO2 and NOx are much lower than the national standard criterion GB13223-2003 as the low S and N content in biomass fuel. Comparing to the open fire of biomass and other coal power plant, the proposed project would reduce air pollution. Water The major wastewater emissions mainly include industrial wastewater and domestic sewage. Part of the industrial waste water, which is in good quality and meet the output requirement, would be recycle to the power plant and the rest would be output directly. Domestic sewage will be led to the Nangong County Wastewater Treatment Factory through the municipal wastewater pipe network. Under comprehensive utilization of the wastewater, the treated water can be used as supply water for the cooling system and boilers. So the wastewater from the project won’t impact the surrounding environment. Noise During the equipment selection and design, the equipments with low noise have been chosen. Noise reduction equipments have been installed to minimize the noise impacts. Certain space has been reserved and green trees will be planted in order to reduce environment noise. The noise inside and outside the power plant can meet the State Standard. Solid waste The major solid waste generated by the proposed project is the ash from the boilers. The ash has high Kalium content and can be serve as good fertilizer for agriculture. The research concluded that the proposed project would not have significant negative environment impact. Air pollution caused by the biomass open burning can be avoided by the comprehensive utilization of biomass residues. D.2. Environmental impact assessment >> Don’t need.

SECTION E. Local stakeholder consultation E.1. Solicitation of comments from local stakeholders >> Comments on the construction of the proposed National Bio Energy Nangong Project are required by local government and the construction company through a series of means of informal discussion, hearing of witnesses and visits to guarantee a successful implementation of the proposed project with the interests of stakeholders being taken into account. The environment impact information was published by post from 2nd to 13th April 2007 and distribute the environment impact report to the local people and government for comments during 17/04/2007~30/04/2007. Questionnaires and local stakeholder consultation meeting were adopted to collect the local stakeholders’ comments. The project developer has sent out 50 questionnaires to the surrounding area of the proposed project in Nangong County for the comments of the proposed project construction and 50 pieces of reply were received. The LSC meeting was held in Nangong government building with 15 stakeholders presentation on 28/04/2007. E.2. Summary of comments received >> Part of the survey was conducted through distributing and collecting responses to a questionnaire. Totally 50 questionnaires returned out of 50 with 100% response rate. The basic structure of the respondents is illustrated in TableE-1.

Table E-1 Structure of the respondents


Structure of gender Structure of educational level Structure of age

Gender Number Percentage (%)

Educational level Number Percentage (%) Age Number Percentage

(%)

Male 45 90 Technical college and higher 2 4 18~35 7 14

Female 5 10 Senior high school 18 36 36~50 13 26

Junior high school 28 56 Above

50 30 60

Elementary school 2 4

It can be seen that respondents are adequately representative in terms of gender, age and educational level, and their attitudes towards the impacts of the Project can be a comprehensive reflection of the attitudes of the residents possibly affected by the Project. Of the 50 respondents: ·98% respondents support the construction of the Project. 2% showed they don’t concern about the project impact. No opposite opinion received from the questionnaire. ·Respondents consider that positive impacts possibly caused by the construction of the Project include improve local development (88%), individual life (74%) and 98% of them agree with the choice of the project location. During the local stakeholder consultation meeting, 100% of the participants were agreed with the construction of the project. A few respondents were concerned that the project impact to the water resource and dust treatment. After the explanation of the environment protects instrument and method of the project, all the represents showed they welcome the set up the project. E.3. Report on consideration of comments received >> All the residents and local government are very supportive of the Project. The Project owner has taken full consideration of the comments and suggestions given by stakeholders during preparation of the Project, therefore there has been no need to modify the Project due to the comments received. Based on the concern of the a few respondents, the dust-remove and other pollution protect measures would strictly obeyed by the project owner during the operation of the project to meet the environment requirement and reduce the impact to the surrounding inhibitions.

SECTION F. Approval and authorization >> It’s not necessary as a VER project.

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Appendix 1: Contact information of project participants

Organization name National Bio Energy Co., Ltd. Street/P.O. Box

Building City Beijing State/Region Beijing Postcode Country China Telephone +86 10 58681540 Fax E-mail [email protected] Website Contact person Title Project manager Salutation Last name Li Middle name First name Zheng Department Mobile Direct fax Direct tel. Personal e-mail


Organization name South Pole Carbon Asset Management Street/P.O. Box Jianguo Road Yi 118# Chaoyang District Building No.1107, Jinghui building City Beijing State/Region Beijing Postcode 100022 Country China Telephone +86 1084549953 Fax +86 1084549953 E-mail [email protected] Website Contact person Title Project manager Salutation Last name Qu Middle name First name Justin Department Mobile Direct fax Direct tel. Personal e-mail

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 CDM – Executive Board

Appendix 2: Affirmation regarding public funding

No public funding.

Appendix 3: Applicability of selected methodology

N/A

Appendix 4: Further background information on ex ante calculation of emission reductions

To determine the simple operating margin emission factor (EFgrid,OM,y) and the build margin emission factor (EFgrid,BM,y) of the proposed project, data recommended in the Announcement to publish the “2012 Baseline Emission Factors for Regional Power Grids in China” for North China Power Grid are adopted.

The following tables summarise the numerical results from the equations listed in the “Tool to calculate the emission factor for an electricity system”. Information provided by the tables includes data, data sources and the underlying calculations. Calculation of Operating Margin (OM)

Table 4-1 Thermal power generation of North China Power Grid in 2008

Province Electricity generation


Auxiliary electricity consumption

Electricity delivered to the grid

（108kWh) （MWh) （%）（MWh) Beijing 243 24,300,000 7.14 22,564,980 Tianjin 397 39,700,000 7.05 36,901,150 Hebei 1580 158,000,000 6.9 147,098,000 Shanxi 1762 176,200,000 8.22 161,716,360 Inner Mongolia 2008 200,800,000 7.96 184,816,320 Shandong 2689 268,900,000 7.14 249,700,540

Total 867,900,000 802,797,350 Data source: China Electric Power Yearbook 2009

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 CDM – Executive Board







Total 923,000,000 853,705,050 Data source: China Electric Power Yearbook 2010







Total 1,039,600,000 963,892,440 Data source: China Electric Power Yearbook 2011

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 CDM – Executive Board page 57

Table 4-4 Calculation of the simple OM emission factor of the North China Power Grid in 2008

Energy Unit Beijing Tianjin Hebei Shanxi Inner

Mongolia Shandong Total Fuel Emission

factor NCV CO2Emission kgCO2/TJ MJ/t, km3 tCO2e

Raw coal 104t 755.75 1800.12 7353.33 7854.39 12607.82 12360.75 42732.16 87,300 20,908 779,976,613 Cleaned coal 104t 23.88 23.88 87,300 26,344 549,200 Other washed coal 104t 5.05 134.52 582.39 66.2 691.21 1479.37 87,300 8,363 10,800,731 Briquetted coal

104t 5.66 32.49 45.38 83.53 87,300 20,908 1,524,647 Coke 104t 0.02 6.07 6.09 95,700 28,435 165,723 Coke oven gas 108m3 0.11 0.86 8.37 24.55 3.55 16.2 53.64 37,300 16,726 3,346,491 Other coal gas 108m3 10.4 9.08 187.54 36 34.32 29.76 307.1 37,300 5,227 5,987,440 Raw oil 104t 0.02 0.02 71,100 41,816 595 Gasoline 104t 0 67,500 43,070 0 Diesel 104t 0.15 3.08 0.35 3.58 72,600 42,652 110,856 Fuel oil 104t 2.56 0.25 2.81 75,500 41,816 88,715 LPG 104t 0 61,600 50,179 0 Refinery gas 104t 0.44 2.93 3.37 48,200 46,055 74,809 Natural gas 108m3 11.09 0.7 0.97 2.12 14.88 54,300 38,931 3,145,563 Other petroleum products 104t 1.45 1.45 72,200 41,816 43,777 Other coke products 104t 7.97 7.61 15.58 95,700 28,435 423,968 Other energy 104tCe 4.9 2.34 61.02 466 63.72 141.71 739.69 0 0 0 Total 806,239,126 Data source: China Electric Power Yearbook 2009







104t 3.73 31.83 35.56 87,300 20,908 649,065 Coke 104t 10.43 10.43 95,700 28,435 283,824 Coke oven gas 108m3 0.13 1.27 8.72 19.48 3.35 11.69 44.64 37,300 16,726 2,784,999 Other coal gas 108m3 10.23 13.43 228.32 35.89 48.35 37.21 373.43 37,300 5,227 7,280,656 Raw oil 104t 0.13 0.13 71,100 41,816 3,865 Gasoline 104t 0.01 0.01 67,500 43,070 291 Diesel 104t 0.1 2.38 2.64 3.07 8.19 72,600 42,652 253,606 Fuel oil 104t 0.82 0.19 0.02 2.63 3.66 75,500 41,816 115,550 LPG 104t 0 61,600 50,179 0 Refinery gas 104t 0.83 3.95 3.44 8.22 48,200 46,055 182,472 Natural gas 108m3 13.55 0.63 4.39 2.03 0.03 20.63 54,300 38,931 4,361,086 Other petroleum products 104t 1.52 23.18 24.7 72,200 41,816 745,721 Other coke products 104t 6.62 7.79 5.52 19.93 95,700 28,435 542,341 Other energy 104tCe 2.11 62.14 570.3 90.63 137.68 862.86 0 0 0 Total 822,391,221 Data source: China Electric Power Yearbook 2010







104t 1.53 41.98 43.51 87,300 20,908 794,174 Coke 104t 0 95,700 28,435 0 Coke gangue 252.29 2120.95 601.17 898.03 3872.44 87,300 8,363 28,272,293 Coke oven gas 108m3 0.04 1.75 17.2 20.41 4.4 11.86 55.66 37,300 16,726 3,472,515 Blast furnace gas 108m3 12.89 18.53 295.02 41.74 49.56 203.79 621.53 219,000 3,763 51,220,101 Converter gas 108m3 8.48 0.07 8.55 145,000 7,945 984,981 Other coal gas 108m3 0 37,300 5,227 0 Raw oil 104t 0 71,100 41,816 0 Gasoline 104t 0 67,500 43,070 0 Diesel 104t 0.1 2.27 0.55 2.66 5.58 72,600 42,652 172,787 Fuel oil 104t 0.49 0.17 0.01 3.24 3.91 75,500 41,816 123,443 Petroleum naphtha 104t 0 72,600 43,906 0 Lubricating oil 104t 0 71,900 41,398 0 Paraffin 104t 0 72,200 39,934 0 Solvent oil 104t 0 72,200 42,945 0 Petroleum pitch 104t 0 69,300 38,931 0 Petroleum coke 104t 6.97 12.47 2.82 22.26 82,900 31,947 589,535


LPG 104t 0 61,600 50,179 0 Refinery gas 104t 1.37 2.12 2.41 5.9 48,200 46,055 130,971 Natural gas 108m3 16.08 0.57 0.22 6.16 0.18 0.16 23.37 54,300 38,931 4,940,309 Other petroleum products 104t 0.85 28.14 28.99 72,200 41,816 875,241 Other coke products 104t 7.99 3.4 11.39 95,700 28,435 309,948 Other energy 104tCe 20.42 17.07 45.53 34.66 20.8 38.56 177.04 0 0 0 Total 995,406,604 Data source: China Electric Power Yearbook 2011

Table 4-7 Power import by North China Power Grid from 2008 to 2010 2008 2009 2010 Net electricity import from Northeast China Grid (MWh) 5,286,140 6,982,610 8,815,880 Emission factor of Northeast China Power Grid (tCO2/MWh) 1.10489 1.06915 1.10573 Net electricity import from Northwest China Grid (MWh) 2,048,870 Emission factor of Northwest China Power Grid (tCO2/MWh) 0.9853 Total emission of North China Power Grid (tCO2) 812,079,707 829,856,644 1,007,173,290 Total power supply of North China Power Grid (MWh) 808,083,490 860,687,660 974,757,190 Emission Factor of North China Power Grid (tCO2/MWh) 1.00495 0.96418 1.03326

Based on the data provided in Table 4-1 to 4-7, the operating margin emission factor of North China Power Grid is: (812,079,707+829,856,644+1,007,173,290)/(808,083,490+860,687,660+974,757,190)=1.00211 tCO2/MWh Calculation of Build Margin (BM)

Table 4-8 Calculation of weights of CO2 emissions of solid, liquid and gaseous fossil fuels in total emissions for power generation


Energy Unit Total Oxidation

rate Fuel Emission

factor NCV CO2Emission (tCO2e) λ kgCO2/TJ MJ/t, km3 L=G×H×J×K/100000(mass unit) G H J K L=G×H×J×K/10000 (volume unit)

Raw coal 104t 48902.82 1 87,300 20,908 892,607,720 Cleaned coal 104t 0.87 1 87,300 26,344 20,009 Other washed coal 104t 1491.95 1 87,300 8,363 10,892,576 Briquetted coal 104t 43.51 1 87,300 20,908 794,174 Coke 104t 0 1 95,700 28,435 0 Coal gangue 104t 3872.44 1 87,300 8,363 28,272,293 Other coke products 104t 11.39 1 95,700 28,435 309,948

Sub-Total 932,896,721 93.72% Raw oil 104t 0 1 71,100 41,816 0 Gasoline 104t 0 1 67,500 43,070 0 Diesel 104t 5.58 1 72,600 42,652 172,787 Fuel oil 104t 3.91 1 75,500 41,816 123,443 Petroleum coke 104t 22.26 1 82,900 31,947 589,535 Other petroleum products 104t 28.99 1 75,500 41,816 915,246

Sub-Total 1,801,010 0.18% Natural gas 108m3 23.37 1 54,300 38,931 4,940,309 LNG 104t 0 1 54,300 51,434 0 Coke oven gas 108m3 55.66 1 37,300 16,726 3,472,515 Blast furnace gas 108m3 621.53 1 219,000 3,763 51,220,101 Converter gas 108m3 8.55 1 145,000 7,945 984,981 Other coal gas 108m3 0 1 37,300 5,227 0 LPG 104t 0 1 54,300 38,931 0 Refinery gas 104t 5.9 1 48,200 46,055 130,971

Sub-Total 60,748,877 6.10% Other energy 104tCe 177.04 1 0 0 0


Total 995,446,608 100.00% Source: China Energy Statistics Yearbook 2011

Table 4-9 Emission factor representing best technology commercially available for fuel of coal-fired, oi-fired and gas-fired power plants

Type of power plant Variables Power supply

efficiency (%)

Emission factor of fuels (kgCO2/TJ)

Oxidation rate

Emission factor (tCO2/MWh)

A B C D=3.6/A/10,000×B×C Coal fire power plant EFCoal,Adv,y 39,65 87,300 1 0.7926 Oil fired power plant EFOil,Adv,y 51.93 75,500 1 0.5234 Gas fired power plant EFGas,Adv,y 51.93 54,300 1 0.3764

Calculated with the data provided in Table 4-8, the value of λCoal,y is 93.72%, the value of λOil,y is 0.18% and the value of λGas,y is 6.10%. Therefore,

€

EFThermal,y = λCoal,y × EFCoal,Adv,y + λOil ,y × EFOil,Adv,y + λGas,y × EFGas,Adv,y =0.76675 tCO2/MWh.

Table 4-10 Installed capacity of the North China Power Grid in 2010 Installed Capacity Unit Beijing Tianjin Hebei Shanxi Inner Mongolia Shandong Total

Thermal Power MW 5,140 10,910 36,640 42,100 54,020 60,020 208,830 Hydro Power MW 1,050 10 1,790 1,820 850 1,070 6,590

Nuclear Power MW 0 0 0 0 0 0 0 Wind Power and

Others MW 110 30 3,720 370 9,730 1,399 15,359


Total MW 6,300 10,950 42,150 44,290 64,600 62,489 230,779 Source: China Electric Power Yearbook 2011


Thermal Power MW 5,120 10,030 35,140 39,150 48,300 58,860 196,600 Hydro Power MW 1,050 10 1,790 1610 830 1,060 6,350


Others MW 50 0 1360 120 6,420 860 8,810 Total MW 6,220 10,040 38,290 40,880 55,550 60,780 211,760

Source: China Electric Power Yearbook 2010


Thermal Power MW 4,760 7,490 29,870 35,250 45,740 55,930 179,040 Hydro Power MW 1050 0 1540 790 830 1,050 5,260


Others MW 0 0 700 0 2,300 370 3,370 Total MW 5,810 7,490 32,110 36,040 48,870 57,350 187,670


Source: China Electric Power Yearbook 2009

Table 4-13 Installed capacity of North China Grid

Installed capacity in 2008



New added installed capacity 2008-2010*

Newly added installed capacity 2009-2010*

Proportion against newly added installed capacity

(MW) A B C D E F Thermal power 179,040 196,600 208,830 40,282 19,113 77.46% Hydro-power 5,260 6,350 6,590 -270 -1,360 -0.52% Nuclear power 0 0 0 0 0 0.00% Wind power and others 3,370 8,810 15,359 11,989 6,549 23.06% Total 187,670 211,760 230,779 52,001 24,302 100.00% Percentage compared with installation 2010 22.53% 10.53%

*Calculated with the consideration of installed, shut-down and pumped storage capacity EFBM,y=0.76675×77.46%=0.5940 tCO2/MWh The OM is calculated as 1.00211 tCO2/MWh, the BM is calculated as 0.5940 tCO2/MWh. And the electricity generation baseline emission factor equal to the combined margin with equally weighted average of the operating margin emission factor and the build margin emission factor. According to “Tool to calculate the emission factor for an electricity system”, the default weight is : WOM = 0.5; WBM=0.5 So the Emission Factor for North China Grid (EFgrid,CM,y. ) is: EFgrid,CM,y = 0.5 × 1.00211 + 0.5 × 0.5940 = 0.79803 tCO2/MWh.


Appendix 5: Further background information on monitoring plan

Please refer to Section B.7.

Appendix 6: Summary of post registration changes

N/A

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History of the document

Version Date Nature of revision 04.1 11 April 2012 Editorial revision to change version 02 line in history box from Annex 06 to

Annex 06b. 04.0 EB 66

13 March 2012 Revision required to ensure consistency with the “Guidelines for completing the project design document form for CDM project activities” (EB 66, Annex 8).

03 EB 25, Annex 15 26 July 2006

02 EB 14, Annex 06b 14 June 2004

01 EB 05, Paragraph 12 03 August 2002

Initial adoption.

Decision Class: Regulatory Document Type: Form Business Function: Registration

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