CDM PRE-SCREEN TOOL

This simple excel-based tool was developed to assist companies in determining whether they can and should participate in the CDM. The tool can be applied during step 1 of the CDM cycle: project preparation. However, the findings will also support the development of a project idea note (PIN) and the development of the project design document (PDD). The tool consists of three parts: Part I CDM Eligibility: eleven questions assist a company to determine if a project is in principle eligible for CDM; Part II GHG Calculation: allows a company to calculate an initial emission baseline and potential reductions through CDM to determine the potential number of certified emission reductions (CERs); and Part III Financial Feasibility: calculates if the project is feasible as a CDM project by providing a quick calculation of the payback period and internal rate of return (IRR) of transaction and additional costs associated with the CDM application procedure.

CDM PRE-SCREEN TOOL Part I: CDM Eligibility

In order to evaluate the potential for applying for CDM, every project plan should be assessed against certain criteria. These criteria can be summarized in the eleven questions below. For more information please refer to the separate CDM Information Paper. Questions 1 - 7 are exclusive criteria for CDM eligibility: if the answer to any of these questions is "No", application of the project under the CDM is not possible. Question 8 assesses if the project is eligible as a "small-scale project" that can go through a simplified CDM application process. Amendments must be made to the proposed project if the project does not meet the criteria of technology (question 9), environmental impact (question 10) and financial feasibility (question 11). For assistance on further steps to elaborate the Project Idea Note or the Project Design Document, please ask for assistance from CDM experienced consultants. 1. Has the host country ratified the Kyoto Protocol? Ratification of the Kyoto Protocol by the host country is the only binding condition of entry. Whether a host country has ratified the Kyoto Protocol can be checked at http://unfccc.int/parties_and_observers/parties/non_annex_i/items/2833.php or click on the link below List of Non-Annex I Ratified Kyoto Protocol 2. Has the host country assigned a Designated National Authority (DNA) A DNA is needed to receive the national approval for CDM projects. Addresses and contact persons of the DNAs worldwide can be found under http://cdm.unfccc.int/DNA or click the link below

3. Will the project reduce one or more of the following emission types? Only specified greenhouse gases with a certain Global Warming Potential (GWP expressed in CO 2-equivalients) can be considered for CDM project: Carbon dioxide (CO2) Methane (CH4) Nitrous oxide (N2O) Hydrofluorcarbons (HFCs) Perfluorcarbons (PFCs) Sulphur hexafluoride (SF6)

4. Does the project meet sustainable development requirements of the host country? Each host country has a set of sustainable development criteria, covering economy, ecology and social. The DNA reviews if CDM projects meet these criteria prior to approval. 5. Will the emission reduction of the project be additional? Emission reductions from the CDM project must be additional to what would have happened under normal or 'business-as-usual conditions. Additionality is proven if the emissions under the CDM project scenario are lower than under the baseline scenario without the CDM project. 6. Is the project NOT financed through official development assistance (ODA)? Money for CDM projects must not divert ODA. If the project will be financed by sources of public funding, it must be confirmed that the sources of public funding are not counted towards the official development assistance and GEF financial obligations of the Annex I countries. Examples include funding through the Asia Development Bank or World Bank. 7. Does the project fall into one of the following categories? The following are the general categories under which CDM project applications are allowed: End-use energy efficiency improvements (e.g. high efficiency lighting, vehicle efficiency) Supply side energy efficiency improvements (e.g. improving electricity transmission and distribution systems or updating district heating networks); Renewable energy (wind, solar, biomass/biogas, small hydropower, other renewables); Fuel switching (e.g. conversion from coal to gas, biofuels replacing fossil fuels) Industrial processes (e.g. reducing CO2 from cement production, reduction of HFCs, PFCs, SF6) Sequestration and sinks, i.e. reforestation and afforestation 8. Small-Scale Project check (no exclusion criteria!) Does the project fall into any of the Type 1 to 3 of small scale projects? Type I: Renewable Energy Projects with a capacity of up to 15 MW to be interpreted as maximum capacity of 15 MWel on the basis of the specification of the manufacturer Type II: Energy Efficiency Projects which reduce the energy consumption on the demand and supply side by up to 15 GWh/year (54 TJ) in comparison to the business-as-usual scenario Type III: Other projects which reduce emissions and are emitting less than 15 kt CO2/year Note: These project types are treated exclusively, which means that if a project is a renewable energy project type as well as an energy efficiency project type, the project must be below the limits of both project types 9. Does the potential technology meet the following conditions? A proven technology, although not necessarily applied in the host country; An established and commercially feasible technology, although not necessarily in the host country; and A replicable technology and/or one that can effectively be transferred to the host country 10. Does the project result in unacceptable negative impacts on the environment? As a general rule, an environmental impact assessment (EIA) is required for projects that potentially have significant negative impacts on the environment, even if the host countrys regulations are not requiring an EIA. Unless significant impacts are mitigated the project is unlikely to get approval under the CDM. If an EIA is required then this also has implications for the financial investment a company must make.

11. Does the project have an acceptable payback period? The projects financial feasibility is determined by the costs (transaction costs, additional costs, project implementation costs) and revenues (CERs and other savings). Part III of the tool assists in determining the payback period or internal rate of return (IRR)

Result of the pre-screen

Please answer all questions

CDM PRE-SCREEN TOOL PART II: GHG Emissions Baseline and Reduction Calculation
Part II of the tool can be used to calculate an indicative emission baseline and expected emission reductions through the CDM project. If there are multiple potential CDM projects, then emission reductions must be calculated for each project separately. The baseline and emission reductions are calculated for four emission sources. Emission reductions are calculated on an annual basis and for the total crediting period (one times 10 years or three times 7 years). The results are forming the basis for estimating revenues through Certified Emission Reductions, which are calculated in Part III of the tool. INSTRUCTIONS 1. Fill in the white fields, and GHG emissions will be automatically calculated (some fields provide additional comments if touched with the cursor. The comments are indicated by a red triangle in the upper right corner of the field) 2. Standard emission factors are provided in yellow fields. The factors can be replace with company specific emission factors if available 3. Please make sure to provide data in the correct unit as indicated!! Use conversion factors (separate sheet) to convert from e.g. m 3 to tons 4. Please save the document under a different name for each calculation scenario GENERAL INFORMATION

Month

Year

Date Name of Company: Country Project type Life time of the project CDM application period Main product: Production/d (baseline) Production/d (CDM project) Date baseline calculation:

years

Tons product Tons product

1. CO2 EMISSION AND REDUCTION THROUGH FUEL COMBUSTION (for production and onsite electricity generation, but excluding fuel as feed for e.g. ammonia production) Fuel Type Quantity/y Unit Baseline Reduction Coal Natural Gas Diesel oil Biomass Other fuel: Sub total 1 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Tons Tons (1000 liters) Tons

Emission factor 2.51 2.93 2.68 0.00

CO2 emissions (tons/y) Baseline Reduction 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Note: if other fuels are used for the production process, please insert these and use the emission factors from the UNEP GHG Calculator)

2. CO2 EMISSION AND REDUCTION THROUGH FUEL FOR TRANSPORT Fuel Type Quantity/y Baseline Reduction Petrol Diesel LPG Sub total 2 0.00 0.00 0.00

Unit Emission factor 0.00 (1000 liters) 0.00 (1000 liters) 0.00 (1000 liters) 2.22 2.68 1.65

CO2 emissions (tons/y) Baseline Reduction 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

3. CO2 EMISSION AND REDUCTION THROUGH ELECTRICITY CONSUMPTION Electricity Baseline Electricity purchased from grid Electricity exported Sub total 3 Quantity/y Reduction 0.00 0.00 Unit Emission factor 0.00 MWh 0.00 MWh 0.72 0.72 CO2 emissions (tons/y) Baseline Reduction 0.00 0.00 0.00 0.00 0.00 0.00

Note: please use company specific emission factors or otherwise the default emission factor for your country indicated on the right Note: emissions from electricity exported are subtracted from electricity purchased from the grid 4. PROCESS RELATED REDUCTION OF GHGSs (!! Please type in the reductions as negative numbers with preceding minus sign !!) Process Process Quantity/y Unit Baseline Reduction Gaseous emissions Carbon dioxide (CO2) 0.00 0.00 Tons Gaseous emissions Methane (CH4) 0.00 0.00 Tons Gaseous emissions Nitrous oxide (N2O) 0.00 0.00 Tons Gaseous emissions Gaseous emissions Gaseous emissions Gaseous emissions Waste Water emissions Sub total 4 kg COD/yr 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Tons Tons Tons Tons

CO2eq emission (tons/y) Emission Baseline Reduction factor 1.00 0.00 21.00 0.00 310.00 0.00 0.00 0.00 0.00 0.00 0.0033 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 kg COD/yr

5. SUMMARY OF GHG EMISSIONS GHG emission source Baseline CO2 Emissions 1. Fuel combustion 2. Fuel for transport 3. Electricity consumption 4. Process related Grand total (1, 2, 3 + 4) 0.00 0.00 0.00 0.00 0.00 Quantity/y CO2 reduction (tons/y) 0.00 0.00 0.00 0.00 0.00 CO2 reduction within crediting period (tons) 10 years crediting period 0.00 0.00 0.00 0.00 0.00

END OF CALCULATOR

CDM PRE-SCREEN TOOL PART III: CDM FINANCIAL FEASIBILITY

Part III of the tool provides a simple way to assess if participating in the CDM is financially feasible by determining the payback period of costs under the CDM. Transition costs are associated with project preparation and review, establishing baseline and monitoring plan (step 1-3 of the CDM process); validation process (step 4-7); and initial verification and start-up and periodic verification and certification. Additional costs are associated with internal personal costs for assisting with and supervising the work of consulting companies; operation and maintenance (O&M) costs of the monitoring system; and purchase of monitoring equipment and system. To estimate the real CDM transaction costs and additional costs, please refer to the CDM Information Paper. 6. PROJECT COSTS/REVENUE BALANCE Costs/Revenue Balance US$ 0.00 0.00 0.00 e.g. US$ 5

CDM related Costs Total CDM transaction costs Annual additional costs CER value

Annual CDM revenue 0.00 CDM revenue 10 years crediting period 0.00 IRR 0.00% Payback period 0.0 years Note: Payback period is calculated only on the CDM transaction and annual additional costs, NOT on the overall project investment and operating costs

Conversion Factors
To convert from grams (g) kilograms (kg) megagrams gigagrams pounds (lb) tons (long) tons (short) barrels (petroleum, US) cubic feet (ft 3) litres cubic yards gallons (liquid, US) imperial gallon joule kilojoule To metric tonnes (t) metric tonnes (t) metric tonnes (t) metric tonnes (t) metric tonnes (t) metric tonnes (t) metric tonnes (t) cubic metres (m 3) cubic metres (m 3) cubic metres (m ) cubic meters (m 3) cubic meters (m ) cubic meters (m ) gigajoules (GJ) gigajoules (GJ)
3 3 3

Multiply by -6 1 x 10 1 x 10 1
-3

To convert from megajoule terajoule (TJ) Btu calories, kg (mean)

To gigajoules (GJ) gigajoules (GJ) gigajoules (GJ) gigajoules (GJ) gigajoules (GJ) gigajoules (GJ) GJ / m GJ / metric tonnes metric tonnes / m 3 bar bar bar kilometer tonne CO2 equivalent tonne CO2 equivalent tonne CO2
3

Multiply by -3 1 x 10 1 x 10
3 -6

1.05506 x 10 4.22887 x 10 3.6 x 10 -3 3.72589 x 10

1 x 10 3 4.5359 x 10 1.016 0.9072 0.15898 0.028317 1 x 10 0.76455

-3 -4

4.187 x 10 -6
-3

tonne oil equivalent (toe) kWh Btu / ft Btu / lb lb / ft 3 psi

3

-5

2.326 x 10 -3 1.60185 x 10 -2 0.0689476 0.980665 1.01325 1.6093 21 310 3.664

3.7854 x 10 1 x 10 1 x 10
-9 -6

-3 -3

kgf / cm 3 (tech atm) atm mile (statue) tonne CH4 tonne N2O tonne carbon

4.54626 x 10

Sources: International Energy Annual, 1998 http://www.eia.doe.gov/emeu/iea/convheat.html BP Group Reporting Guidelines, 2000

Greenhouse Gases and their Global Warming Potential (GWP)

Trace Gas HFC-143a HFC-152a HFC-227ea HFC-23 HFC-236fa HFC-245ca HFC-32 HFC-41 HFC-43-lOmee HFC- 125 HFC-134 HFC-134a HFC-143 3800 140 2900 9800 6300 560 650 150 1300 2800 1000 1300 300 GWP Eligible under CDM Trace Gas Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Carbon Dioxide Methane Nitrous Oxide Perfluorobutane Perfluorocyclobutane Perfluoroethane Sulphur hexafluoride 1 21 310 7000 8700 9200 23900 GWP Eligible under CDM Yes Yes Yes Yes Yes Yes Yes

Source: IPCC 1990 & 1996 Source: The GHG Indicator, UNEP: http://www.uneptie.org/energy/act/ef/GHGin/