CDM Project Colombia Gas Natural

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02
CDM Executive Board
page 1
CLEAN DEVELOPMENT MECHANISM

PROJECT DESIGN DOCUMENT FORM (CDM-PDD)
Version 02 - in effect as of: 1 July 2004)
CONTENTS
A.
General description of project activity
B.
Application of a baseline methodology
C.
Duration of the project activity / Crediting period
D.
Application of a monitoring methodology and plan
E.
Estimation of GHG emissions by sources
F.
Environmental impacts
G.
Stakeholders comments
Annexes
Annex 1: Contact information on participants in the project activity

Annex 2: Information regarding public funding
Annex 3: Baseline information
Annex 4: Monitoring plan
This template shall not be altered. It shall be completed without modifying/adding headings or logo, format
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SECTION A. General description of project activity

A.1
Title of the project activity:
Umbrella Fuel-Switching Project in Bogot and Cundinamarca

Version 03 30 April 2006
A.2.
Description of the project activity:
The project activity primarily aims at reducing GHG emissions through fuel switching. The
project consists of investment to replace the use of liquid petroleum fuels by natural gas, funded
through the sale of carbon credits in the context of the Clean Development Mechanism (CDM)
of the Kyoto Protocol.
Eight companies lead this fuel-switching project, which involves the conversion of equipment
of their industrial facilities located in the Colombian Department of Cundinamarca.
For this project activity, the companies are represented by Gas Natural S.A. E.S.P. that is
considered as the Colombian project participant.
Gas Natural S.A. E.S.P. is a consolidated company with over 13 years of experience as a
leading distributor of natural gas. In 1998 it was acquired by the Gas Natural SDG group (a
Spanish multinational company), that is part of CAIXA and REPSOL groups. The company
distributes natural gas to 1.3 millions residential and industrial users in Bogot and the nearby
Departments of Cundinamarca and Boyac.
The companies involved in this project activity are shown in Table 1:
Table 1: companies involved
Company
Industrial Sector
Bavaria S.A.
Brewery
Protela S.A.
Textile industry
Alpina S.A.
Food industry (mainly milk-derived products).
Suizo S.A.
Food industry (meat-derived products)
Proalco S.A.
Wire production facility
Sigra S.A.
Vegetal and animal fat production facility
Icollantas S.A.
Rim production facility
Peldar S.A.
Crystal production facility
Currently, the industrial facilities consume residual fuel oil to generate steam and process heat.
Table 2 shows the average annual fuel consumption of each plant and the processes in which
this fuel is consumed:
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Table 2: processes and fuel consumption

Process
Company
Steam
generation
Thermal oil
heating
Baking and glass and wire

production in furnaces
Average fuel consumption

GJ/year
Bavaria
763,865
Protela
Alpina
148,386
Suizo
34,173
Proalco
166,187
51,683
Sigra
300,622
Icollantas
176,077
Peldar
Total
443,994
2,084,986
The total average residual fuel oil consumption of the industries participating in this project
activity is 2,084,986 GJ/year, 23.8% of which is used in furnaces, 73.8% in boilers, and 2.4% in
thermal oil heating.
The project activity registration under the CDM will allow the industries to minimize the
economic disadvantages related to the fuel substitution cost and the higher fuel cost, keeping in
mind the lower price of residual fuel oil in comparison with the price of natural gas.
The proposed project activity has the capacity to produce GHG emission reductions by 326,675
tCO2e over a 10-year crediting period.
The project also brings the inherent benefits of switching residual fuel oil to natural gas:
Improvement of air quality due to less emission of local pollutants such as NOx, SOx,
and particulate matter.
Improvement of labor and health conditions of its employees.
Lower potential sources of risks, because natural gas does not require any storage.
Lower maintenance of the equipment.
Lower dirtiness and corrosion at the plants.
Continuous supply of fuel.
Less vehicular traffic due to elimination of fuel delivery trucks and therefore less risk of
accidents as well as elimination of tailpipe emissions from these vehicles.
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Thus, the project brings social, environmental, and economic benefits, contributing to the
sustainable development objectives of the Colombian Government, in accordance with Law
99/1993 and national policies tending to a better life quality (e.g. Rational Use of Energy and
Cleaner Production) that can be found in the web site of the Ministry of Environment, Housing,
and Spatial Planning of Colombia www.minambiente.gov.co.
The project has obtained the national approval from the Colombian DNA, confirming that the
project contributes to the sustainable development of Colombia. In addition, the project has also
obtained the national approval from the Spanish DNA.
A.3.
Project participants:
Table 3: project participants
Name of Party
involved
A.4.
Private or public entity
Is the Party
involved a
project
participant?
Colombia (Host)
Gas Natural S.A. E.S.P. (private)
No
Spain
Gas Natural (private)
No
Technical description of the project activity:

A.4.1. Location of the project activity:
A.4.1.1.
Host Party(ies):
A.4.1.2.
Region/State/Province etc.:
Colombia
Cundinamarca Department
A.4.1.3.
City/Town/Community etc:
Bogot, Sibate, Sopo, and Cogua
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A.4.1.4.
Detail of physical location, including information allowing
the unique identification of this project activity (maximum one page):
The project is carried out at eight industrial facilities located in Bogot, Sibate, Sopo y Cogua,
in the Colombian Department of Cundinamarca (Figures 1 and 2).
Bogot is the capital of the country and of Cundinamarca Department. Bogotas area is 1,750
km2 and it is home to 7.5 million inhabitants (according to the 2005 census).
Cundinamarcas area is 23,960 km2 and it is home to 15.5 million inhabitants including
Bogots population (according to the 1993 census). Its limits are Boyac in the North; Meta,
Huila, and Tolima in the South; Tolima and Caldas in the West; and Boyac and Meta in the
East.
Figure 1: map of Colombia showing Cundinamarca Department
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Figure 2: map of Cundinamarca Department showing its municipalities
A.4.2. Category(ies) of project activity:

The project activity involves fuel switching from residual fuel oil to natural gas at industrial
facilities.
The corresponding category is: (4) Manufacturing industry.
A.4.3. Technology to be employed by the project activity:
The project is based on fuel switching from residual fuel oil to natural gas and involves the
conversion of the existing equipment, in accordance to the infrastructure, the productive
process, and the investment capacity of each industry participating in the proposed project
activity.
Table 4 shows the equipment involved in the proposed project activity.
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Table 4: equipment involved

Company
Equipment
Alpina
Boiler
Distral A1825
Fire tube, three steps

125 psi
Saturated steam
600 BHP
Boiler
Distral A1874
Fire tube, three steps

125 psi
Saturated steam
700 BHP
Boiler
Titusville 7104
Fire tube, two steps

125 psi
Saturated steam
380 BHP
Boiler
Ateliers Henry Lardet 1402,
pack 31S
Water tube
20 tonne/hr of steam
1,275 BHP
Boiler
Distral A- 741, AGM-134
Water tube
18 tonnes/hr of steam
34 Bar (500 psi)
Furnace 116A
16 burners Korting ZL5 of

142.5 kg/hr
2 heaters Hauck LHE45C of 48
kW
Furnace 113B
6 burners Laidlaw Drew

C4/20/12/8 of 87 gallons/hr
2 heaters Combustin Tec Inc
of 300 gallons/hr and 70 kW
Boiler
Distral A-758
Fire tube
300 psi
600 BHP
Automatic feeding
Installation of Fisher and

Honeywell regulation
trains
Oxygen control in close
loop.
Boiler
Distral A 2021
Fire tube
350 psi
900 BHP
Automatic feeding
Baltur natural gas burner.

Landis electronic
combustion control
system.
Boiler
Geka Wmetech 6473
100 BHP
1,337 psi
Automatic feeding
Baltur bi-fuel burner.

Landis electronic
combustion control
system.
Icollantas
Peldar
Sigra
Quantity
Characteristics
Conversion
Installation of Maxon
regulation trains, with
Fisher regulators.
Combustion control:
electronic modulation
with Honeywell
servomotors and Siemens
PLC. This allows
adjusting the combustion
load in ten different
positions, from low load
to high load.
Flame security is
controlled with
Honeywell equipment.
Regulation trains are
controlled by Normal
regulators and Maxn
security systems.
Mix rings were redesigned
to operate with natural
gas.
Tech combustion system
and Dresser control
system.
Adaptation of gas and fuel
oil trains as backup fuel.
Medium velocity burners.
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Suizo
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Fisher and Honeywell

regulation trains.
Boiler
Power Master A 2601
Fire tube
150 psi
300 HP
Boiler
Power Master A 2616
Fire tube
150 psi
300 HP
Lead Furnace
16 burners of 150,000 Btu/hr
Originally, this furnace

had bi-fuel burners that
were adjusted to operate
with natural gas.
Zinc Furnace
20 burners of 150,000 Btu/hr
Originally, this furnace

had bi-fuel burners that
were adjusted to operate
with natural gas.
Bavaria
Boiler
Sulzer
Water tube
40 tonnes/hr of steam
17 Bar
Over heating steam
Flame security is
controlled with
Honeywell equipment.
Regulation trains are
controlled by Normal
regulators and Maxn
security systems.
Mix rings were redesigned
to operate with natural
gas.
Installation of oxygen
sensors in stack gases.
Protela
Boiler
Inflan/Weishaupt
2 Mkcal
Dual burner in thermal fluid
process
Originally, this boiler had

bi-fuel burners that were
adjusted to operate with
natural gas.
Boiler
Konus 4 Baltur BGN300
2 Mkcal
Burner in thermal fluid process

Landis electronic
combustion control
system.
Boiler
Konus 2 Kromschroder
2 Mkcal
Burner in thermal fluid process
Variable flow
Krom Schoereder and

Dungs regulation trains.
This is a backup boiler.
Boiler
Distral 1 Baltur GIE10DSPGN
500 BHP
Burner in steam process

Landis electronic
combustion control
system.
Boiler
Distral 2 Baltur GI mist 420
400 BHP
Dual burner
Baltur bi-fuel burner.

Landis electronic
combustion control
system.
Boiler
Distral 3 Kromschroder
400 BHP
Variable flow
Fisher and Honeywell

regulation trains.
This is a backup boiler.
Proalco
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In order to monitor natural gas consumption at each industrial facility, the installation of the
following natural gas flow meters is carried out:
Table 5: natural gas flow meters
Company
Bavaria
Number of
meters
2
Meter
Characteristic
Type of meter
Brand
Corrector
Unit
G-400
Turbine
Schlumberger
Mercury
Fluxi TZ2000
Turbine
Peldar
6-GT
Turbine
American Meter
Mercury
Alpina
4-GT
Turbine
American Meter
Mercury
Proalco
16M-175
Rotator
Dresser
Mercury
Protela
6-GT
Turbine
American Meter
Mercury
16M-175
Rotator
Dresser
G-160
Rotator
Romet
Sigra
16M-175
Rotator
American Meter
Mercury
Icollantas
4-GT (one standby unit)
Turbine
American Meter
Mercury
Suizo
16M-175
Rotator
Dresser
--
In addition, the installation of the natural gas pipeline supplying the industrial sites is also
included in the project activity.
Figure 3 shows the required infrastructure for the natural gas supply.
Figure 3: natural gas supply
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where
1. Industrial link-ups
2. Measurement and regulation station
3. Cut valve
4. External pipeline
5. Internal pipeline
6. Regulation train for equipment
7. Adaptation of the room (tails and equipment)
In addition, Figure 4 shows details of the industrial link-ups and the regulation train.
Figure 4: industrial link-ups and regulation train
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The following composition of natural gas1 is expected:

Table 6: typical composition of natural gas
% vol
Methane
78.692
Carbon Dioxide
5.062
Nitrogen
0.536
Ethane
10.123
Propane
4.022
Butane
0.628
Pentane
0.136
Hexane
0.046
Others
0.755
A.4.4. Brief explanation of how the anthropogenic emissions of anthropogenic

greenhouse gas (GHGs) by sources are to be reduced by the proposed CDM project
activity, including why the emission reductions would not occur in the absence of the
proposed project activity, taking into account national and/or sectoral policies and
circumstances:
The proposed CDM project has the capacity to reduce the GHG emissions by replacing a more
carbon intensive fuel (residual fuel oil) by natural gas.
By reducing residual fuel oil use at the project site, the project also reduces carbon dioxide
emissions from fuel transportation to the industrial facilities.
On the other hand, by increasing natural gas use at the project site, the project increases fugitive
methane emissions in the natural gas processing and pipeline supply to the project site, and
leaks at the site.
Thus, the project affects carbon dioxide, methane, and nitrous oxide emissions. Overall, the
project has the capacity to reduce GHG emissions by 326,675 tCO2e over a 10-year crediting
period.
Project additionality is analysed using the tool proposed in the approved baseline methodology
AM0008: Industrial fuel switching from coal and petroleum fuels to natural gas without
extension of capacity and lifetime of the facility.
Details are provided in Section B.3 of this PDD.
Source: Gas Natural S.A. E.S.P.
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A.4.4.1.
crediting period:
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Estimated amount of emission reductions over the chosen
The project has the capacity to reduce GHG emissions by 326,675 tCO2e over a 10-year
crediting period.
Table 7: emission reductions during the crediting period
Years
Annual estimation of emission reductions

(tonnes of CO2e)
2004
30,431
2005
30,842
2006
31,310
2007
31,855
2008
32,431
2009
32,903
2010
33,402
2011
33,931
2012
34,490
2013
35,081
Total estimated reductions (tCO2e)

Total number of crediting years
Annual average over the crediting period of
estimated reductions (tCO2e)
326,675
10
32,667
A.4.5. Public funding of the project activity:

No funds from public national or international sources were used in any aspect of the proposed
project.
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SECTION B. Application of a baseline methodology

B.1.
Title and reference of the approved baseline methodology applied to the project
activity:
The project activity uses an already existing baseline methodology (AM0008), which has been
approved and made publicly available by the CDM Executive Board in June 2004. The baseline
methodology is designated Industrial fuel switching from coal and petroleum fuels to
natural gas without extension of capacity and lifetime of the facility.
B.1.1. Justification of the choice of the methodology and why it is applicable to
the project activity:
The methodology AM0008 is applicable to a project activity, which is to switch the industrial
fuel currently used in some element processes of a facility to natural gas from coal and/or
petroleum fuels that would otherwise continue to be used during the crediting period under the
following conditions:
The local regulations/programs do not constrain the facility from using coal/petroleum
fuels;
Use of coal and/or petroleum fuels is less expensive than natural gas per unit of energy in
the country and sector;
The facility would not have major efficiency improvements during the crediting period;
The project activity does not increase the capacity of final outputs and lifetime of the
existing facility during the crediting period, and
The proposed project activity is defined as fuel switching applied to element processes and
does not result in integrated process change, except for possible changes in other energy
use associated to fuel switching.
As mentioned above, the proposed project activity involves fuel switching from residual fuel oil
to natural gas at eight industrial facilities. The project does not result in integrated process
change, but only involves fuel switching of equipment through its conversion.
The continuation of the current situation is in line with applicable regulations in Colombia.
Legally binding norms established by the government that can be related to the project activity,
are those dealing with air quality, under the authority of the Ministry of Environment, Housing,
and Spatial Planning. Neither of these norms constrains the facility from using residual fuel oil.
The continuation of the current situation is not prevented by regulations.
Residual fuel oil is cheaper than natural gas in the region. Moreover, fuel substitution from fuel
oil to natural gas would require investment for the conversion of the existing equipment. The
additional investment and higher fuel cost imply that the project would not be cost effective.
The companies do not expect to increase the capacity of final outputs or the lifetime of the
existing facilities during the crediting period, since the lifetime of existing equipment of the
plants are longer than the crediting period.
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Additionally, the companies do not expect to carry out significant efficiency improvements.
There will be only the minor energy savings inherent to switching residual fuel oil to natural
gas.
Thus, the proposed project activity meets the conditions under which the methodology AM0008
is applicable.
B.2.
Description of how the methodology is applied in the context of the project
activity:
In order to calculate ex-ante baseline emissions from fuel combustion, residual fuel oil
consumption during the crediting period is estimated according to the average annual fuel
consumption of each industrial facility calculated from historical data, and considering the fuel
consumption growth rate estimated by each company for the next years.
However, the actual baseline proposed is dynamic, taking into account actual changes in fuel
consumption over time, following project implementation. Thus ex-post baseline emissions are
calculated during the monitoring process. Such a dynamic baseline is both realistic and easy to
determine using the same monitoring plan used to determine project emissions.
The consumption of natural gas following project implementation would replace a certain
amount of residual fuel oil consumed in the absence of the project. Thus, baseline emissions
from fuel combustion are not fixed to a predetermined time-dependent value but are updated
annually through the monitoring process. The baseline and project fuel consumption of an
element process (in energy units) are related to each other by the fuel efficiency of the element
process using residual fuel oil prior to fuel switching, and using natural gas following project
implementation. The heat output of the element process is considered the same in the baseline
and project scenarios.
A dynamic baseline is likely to increase the environmental integrity of the project. The timedependent nature of the dynamic baseline is more suited to the project situation, because fuel
consumption depends on plant output, which depends on market and other conditions. Plant
output does not depend on the fuel the plants are using in the production process (residual fuel
oil under the baseline or natural gas under the CDM project activity).
GHG emissions are made up of carbon dioxide, methane, and nitrous oxide emissions from fuel
combustion and fugitive methane emissions from natural gas production, processing, transport
and distribution.2
Carbon dioxide emissions from fuel combustion are determined from the emission
factor given by the IPCC for each fuel.
Methane and nitrous oxide produced in the combustion are estimated using IPCC
standard emission factors for each fuel and equipment type.
Fugitive methane emissions from natural gas production, processing, transport, and
distribution are obtained by the natural gas consumption of each year, using a regionspecific emission factor given by the IPCC.
Carbon dioxide emissions from residual fuel oil transport are not considered in the calculation of
emission reductions as a conservative assumption.
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Total methane emissions (from fuel combustion and fugitive emissions) are converted to
equivalent CO2 emissions using a GWP of 21, as agreed on for the First Commitment Period of
the Kyoto Protocol.3
Similarly, nitrous oxide emissions are converted to equivalent CO2 emissions using a GWP of
310, as agreed on for the First Commitment Period of the Kyoto Protocol.
According to the baseline methodology, the key data used to determine the ex-post baseline
scenario is given in Table 8.
Table 8: key data
Parameters
Data sources
Carbon dioxide emission factor of residual fuel oil, CEFRFO

(kgCO2/GJ)
IPCC default value
Oxidation factor for residual fuel oil
IPCC default value
Methane emission factor of residual fuel oil, MEFRFO

(kgCH4/TJ)
IPCC default value
Nitrous oxide emission factor of residual fuel oil, NEFRFO

(kgN2O/TJ)
IPCC default value
Global Warming Potential of methane, GWP (CH4)
According to Article 5, Section 3 of the Kyoto

Protocol, GWP is as agreed on at COP3
Global Warming Potential of nitrous oxide, GWP (N2O)
According to Article 5, Section 3 of the Kyoto

Protocol, GWP is as agreed on at COP3
Lower heating value of natural gas, LHVNG (kJ/m3)
Gas Natural S.A. E.S.P.
Efficiency of the element process n using residual fuel oil prior

to project implementation, RFO n
Industrial facilities
Variables
Data sources
Quantity of natural gas consumed at the element process n

following project implementation, PFCNG n (m3)
Efficiency of element process n using natural gas following

project implementation, NG n
Article 5.3 of the Kyoto Protocol establishes: The global warming potentials used to calculate the
carbon dioxide equivalence of anthropogenic emissions by sources and removals by sinks of greenhouse
gases listed in Annex A shall be those accepted by the Intergovernmental Panel on Climate Change and
agreed upon by the Conference of the Parties at its third session. Based on the work of, inter alia, the
Intergovernmental Panel on Climate Change and advice provided by the Subsidiary Body for Scientific
and Technological Advice, the Conference of the Parties serving as the meeting of the Parties to this
Protocol shall regularly review and, as appropriate, revise the global warming potential of each such
greenhouse gas, taking fully into account any relevant decisions by the Conference of the Parties. Any
revision to a global warming potential shall apply only to commitments under Article 3 in respect of any
commitment period adopted subsequent to that revision.
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The assumptions regarding heating values and emission factors are unchanged throughout the
crediting period.
In addition, Table 9 shows the element processes considered in the project activity:
Table 9: element processes
Element Process
Description
Industrial Facility
2 Sulzer steam boilers
Bavaria
1 Inflan/Weishaupt thermal oil boiler
Protela
1 Konus 4 Baltur BGN300 thermal oil

boiler
1 Konus 2 Kromschroder thermal oil
boiler
3
1 Distral 1 Baltur GIE10DSPGN steam

boiler
Protela
1 Distral 2 Baltur GI mist 420 steam boiler

1 Distral 3 Kromschroder steam boiler
4
1 Distral A1825 steam boiler
Alpina
1 Distral A1874 steam boiler

1 Titusville 7104 steam boiler
5
1 Power Master A 2601 steam boiler
Suizo
1 Power Master A 2616 steam boiler

6
2 furnaces
Proalco
1 Distral A-758 steam boiler
Sigra
1 Distral A 2021 steam boiler

1 Geka Wmetech 6473 steam boiler
8
1 Ateliers Henry Lardet 1402, pack 31S

steam boiler
Icollantas
1 Distral A- 741, AGM-134 steam boiler

9
1 furnace 116 A
Peldar
1 furnace 113 B
B.3.
Description of how the anthropogenic emissions of GHG by sources are reduced
below those that would have occurred in the absence of the registered CDM project
activity:
The industries, where the project activity is carried out, had been consuming liquid petroleum
fuels due to their low cost in the market.
The consumption of natural gas was not considered by these industries as a viable option
because it was not a cost-effective opportunity due to natural gas high price.
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Following the consolidation of CDM, these industries, along with Gas Natural S.A. E.S.P.,
considered the possibility of taking part in a CDM project activity as a way of minimizing the
costs of switching to natural gas.
Besides, other benefits were also taken into account in the decision-making process that leads to
the implementation of the proposed project activity, such as the contribution to Colombias
Sustainable Development goals, a better air quality, a continuous fuel supply, and lower cost of
equipment maintenance, among others.
Natural gas is more expensive than residual fuel oil in Colombia. Moreover, switching liquid
petroleum fuels by natural gas requires a huge initial investment in adapting equipment
technology.
Initial investment and higher fuel cost determinate the project is not cost effective.
As mentioned above, project additionality is analyzed according to methodology AM0008.
Legal and regulatory requirements
The continuation of the current situation is in accordance with the national regulations. There is
not any restriction to petroleum fuels consumption or commercialization that is used by the
industries participating in the project activity.
Legal regulations established by the government that could be related to the proposed project
activity, are those referred to air quality, such as Law 99/1993, Decree 948/1995, and Decree
02/1982. These can be found in the Ministrys web site www.minambiente.gov.co.
All industries participating in the proposed project activity are in compliance with emission
limits for local pollutants.
None of these regulations is forcing the industries to implement the proposed project activity.
The continuation of the current situation is not prevented by the regulations in force.
Residual fuel oil and natural gas consumption trends in the region
Although fuel price behavior is not stable in Colombia, natural gas is more expensive than
liquid petroleum fuels, residual fuel oil, and non-distillate oil mainly. This is the reason why
exists a notable tendency in preferring petroleum fuels instead of natural gas in the region.
In 2002, barriers that prevented big industries that consumed residual fuel oil and non-distillate
oil to switch by natural gas existed. These barriers are described as follows:
Switching to natural gas did not represent an economical benefit because natural gas
costs were not profitable.
Heavy fuel oil prices are not regulated, so industries can freely negotiate the price they
consider more suitable with the provider.
The natural gas tariff includes the costs of supply and the costs of transporting natural
gas. Both costs were subject to the variations of the international oil market, what
makes it more variable.
Investment costs related to technology to be applied, internal network construction and

measurement and Regulation Stations installation, made the project not cost-effective
for the industries.
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The industries that have switched to natural gas were those that consumed LPG and fuel oil N2.
Besides, as its consumptions were low, fuel prices were regulated so they were not able to
negotiate with the provider.
Investment Analysis
This assessment includes the following elements:
Establishment of price scenarios for petroleum fuels and natural gas.
Determination of equipment operational lifetime, efficiency, costs, and investment.
Definition of the most adequate discount rate and determination of return rates.
Price Scenarios
The scenarios under consideration where proposed by UPME (Unidad de Planeacin Minero
Energtica Energy and Mining Planning Unit) for the next 10 years. This projection was based
on three price scenarios of WTI crude oil prices.
The three WTI oil price scenarios are:
Low Scenario: it was based on the CONFIS (Consejo Distrital de Poltica Econmica y
Fiscal Economic and Fiscal District Council) scenario.
Medium Scenario: this scenario was accorded with Ecopetrol.
High Scenario: the medium scenario of the United States Department of Energy (DOE)
projection was considered.
These scenarios are shown in Figure 5 below.
25,0
24,0
US
$
C
O
RR
IE
NT
ES
/
BL
23,0
22,0
21,0
20,0
19,0
2004
2005
2006
2007
Escenario Confis
2008
2009
Escenario Medio
2010
2011
2012
2013
Escenario EIA
Figure 5: WTI oil price scenarios projection
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Based on WTI oil price scenarios, UPME defined three price scenarios for different fuels such
as residual fuel oil, diesel, liquid petroleum gas, kerosene, and natural gas. Table 10 and Figure
6 show the three price scenarios established, which are used in the economic assessment of this
project.
Table 10: fuel price scenarios projection
Fuel Prices4 ($/MBtu)
Year
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Diesel
Kerosene
Low
Medium
High
Low
Medium
High
20,944
22,665
22,950
24,234
25,593
27,041
28,577
30,187
31,892
33,698
17,192
22,148
22,494
24,227
26,085
28,610
31,338
30,732
33,092
35,624
22,717
24,306
25,779
27,275
28,862
30,544
32,329
34,232
36,241
38,373
19,659
19,227
18,948
18,160
18,243
18,329
18,427
18,529
18,623
18,721
19,659
14,959
15,371
14,808
15,209
15,612
16,339
17,070
15,884
16,301
19,659
18,525
18,075
18,264
18,441
18,622
18,806
18,993
19,191
19,386
Liquid Petroleum Gas

Bogot
Natural Gas Bogot
High
Low
Medium
High
Low Medium
9,129
9,683
10,228
10,795
11,397
12,036
12,714
13,438
14,201
15,011
27,563
23,799
24,749
25,206
26,609
28,093
29,667
31,332
33,115
35,002
27,563
22,642
24,282
24,795
26,602
28,534
31,072
33,799
33,585
36,036
27,563
25,252
26,040
27,593
29,238
30,985
32,833
34,792
36,902
39,129
Residual Fuel Oil

Low Medium
8,405
9,005
8,973
9,410
9,871
10,361
10,881
11,429
12,008
12,619
7,827
8,760
8,757
9,406
10,104
11,410
12,188
11,678
12,558
13,501
14,570
15,626
16,427
17,275
18,208
19,295
20,462
21,715
23,063
24,515
14,655
15,533
16,768
18,115
19,473
20,630
21,870
23,200
24,630
26,168
Natural gas price does not include the 8.9% contribution to the Solidarity Fund.
or font
High
14,694
15,626
17,328
19,494
21,552
22,823
24,184
25,642
27,206
28,886

CDM Executive Board
page 20
Fuel price projection

(medium scenario)

(high scenario)
40,000
40,000
45,000
35,000
35,000
40,000
30,000
30,000
25,000
25,000
20,000
15,000
35,000
30,000
20,000
$/MBtu
$/MBtu
$/MBtu

(low scenario)
15,000
25,000
20,000
15,000
10,000
10,000
10,000
5,000
5,000
5,000
0
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2004
2005
2006
2007
2008
2009
2010
2011
DIESEL
KEROSENE
DIESEL
KEROSENE
DIESEL
KEROSENE
RESIDUAL FUEL OIL
LPG Bogot
RESIDUAL FUEL OIL
LPG Bogot
RESIDUAL FUEL OIL
LPG Bogot
NATURAL GAS Bogot
NATURAL GAS Bogot
Figure 6: fuel price scenarios projection
This template shall not be altered. It shall be completed without modifying/adding headings or logo, format or font
NATURAL GAS Bogot
2012
2013

CDM Executive Board
page 21
Investment
The cost of switching the existent equipment from petroleum fuels to natural gas was determined for
each industry. These investments include costs associated to internal natural gas supply networks,
burners, measure and regulation stations, and control equipment, among others.
Table 11 shows the necessary investment for the completion of the project activity.
Table 11: required investment
Company
Peldar
Sigra
Investment
(Million Colombian pesos, COP)5
879
200
Protela
483
Icollantas
307
Proalco
59
Bavaria
1,006
Suizo
51
Alpina
283
Total
3,267
Equipment
The equipment involved in the project activity has a remaining operating lifetime higher than 10 years,
considered as crediting period of the present project.
Economic Assessment
This assessment has been carried out using a Net Present Value analysis. NPV is estimated by taking
into account the project investment and the incremental flows modified by fuel cost6, over a 10-year
period and using an adequate discount rate.
The economic assessment named above, will be based on each fuel price scenario determined by
UPME.
The discount rate used for the NPV is known as WAAC (Weighted Average Cost of Capital).
Table 12 shows the method and data used in the discount rate calculation:
Exchange rate: 1 USD = 2,303 COP

Operating cost differences are not taking into account since these are negligibly small in comparison with fuel
cost differences.

CDM Executive Board
page 22
Table 12: discount rate calculation

Capital cost (USD)
Abbreviation
Parameters
Observations
Debt
45.6 %
Own funds
RP
54.4%
Risk free rate
Ri
4.87%
T-Bonds tcm 30y media 1993-2003
Market profitability
Rm
12.63%
Source: Damodarn
Country risk rate
5.62%
Yankees 2020 vs T-Bonds tcm 20y (media 2 years)
not leveraged
0.73
leveraged
1.11
Capital cost before taxes (USD)
Ke
19.07%
Projected devaluation (COP/USD)
Dev
3.73%
Forecasted inflation
Inf
6.49%
Debt cost (COP)
Kd
12.9%
Tax rate
Tc
38.5%
WACC nominal after taxes
WACC (at)
16.40%
WACC nominal before taxes
WACC (bt)
18.66%
WACC actual before taxes
WACC (act)
11.43%
Source: Revista Dinero: Junio 12 2003 No 183,

average of Textile, Beverage, and Food Sectors.
Parity IPC Col vs. CPI EEUU projected next years
DTF average 2002 + 4%
Ke = Ri + * (Rm - Ri) + P
WACC (at) = Ko = D * Ki (1 Tc) + RP * Ke / (1 - Tc)
WACC (bt) = WACC (at) / (1 - Tc)
WACC (act) = (1 + WACC (bt)) / (1 + Inflacin EEUU) - 1
The following parameters are considered in the discount rate estimation:
Debt: average capital structure, for year 2003, of the companies that are part of the project
activity.
Capital Cost: its calculation is based on the CAPM (Capital Assets Price Model) methodology,
which considers a risk-free rate, a market return rate, and a country risk rate.
Debt Cost: it depends on each company, on their access to the several available market
mechanisms, etc. A DTF + 4% debt cost is considered as an average cost for any of
companies.
Using these parameters and following the method shown in Table 12 above, it can be determined that
the discount rate to be used in the economic assessment is 18.66%, before taxes.
Net Present Value
Table 13 shows the NPV calculated for each industry.

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page 23
Table 13: Net Present Value
Company
NPV (Million COP)

Medium Scenario
High Scenario
-8,963
-10,298
-10,248
Sigra
-4,587
-4,922
-4,909
Protela
-7,246
-7,750
-7,754
Icollantas
Bavaria
-6,628
-7,160
-7,049
-30,156
-32,382
-32,299
Proalco
-2,324
-2,489
-2,499
Suizo
-1,434
-1,539
-1,535
Alpina
-3,319
-3,821
-3,802
Total
-64,657
-70,361
-70,095
Peldar
Low scenario
Considering the initial investment and the different fuel prices, the project NPV is negative for the
three fuel price scenarios under analysis.
The project activity registration will allow the industries to minimize the mentioned economic
disadvantages, generating not only economic benefits but also environmental and social benefits for
the community.
Therefore, the project activity registration is relevant when taking the decision whether to go ahead
with the proposed project activity.
The previous analysis clearly shows that the continuation of residual fuel oil consumption represents
the baseline scenario, where GHG emissions are higher than the project scenario emissions.
B.4.
Description of how the definition of the project boundary related to the baseline
methodology selected is applied to the project activity:
The project boundary encompasses the physical, geographical site of the industrial facilities involved
in the proposed project activity.
Emission reductions should be adjusted for leakage. Leakage is defined in the CDM M&P as the net
change of anthropogenic emissions by sources of greenhouse gases which occurs outside the project
boundary, and which is measurable and attributable to the CDM project activity.
In accordance with this, Table 14 shows emissions and leakage in the project and baseline scenarios.

CDM Executive Board
page 24
Table 14: emissions and leakage in the project and baseline scenarios
Project Scenario
Emissions
Leakage
Baseline Scenario
Carbon dioxide (CO2) emissions associated with

natural gas combustion at plant site.
Methane (CH4) and nitrous oxide (N2O) emissions
from natural gas combustion at plant site.
Methane (CH4) emissions from natural gas leaks at
plant site.
Carbon dioxide (CO2) emissions from residual

fuel oil combustion at plant site in the baseline.
Methane (CH4) and nitrous oxide (N2O)
emissions from residual fuel oil combustion at
plant site in the baseline.
Carbon dioxide (CO2) emissions from residual

fuel oil transport to the plant sites. These
emissions are excluded as a conservative
assumption.
Methane (CH4) emissions from natural gas

production, processing and pipeline leakage
(natural gas pipeline outside project site).
Other leakage would be associated with gas
pipeline construction to bring natural gas to the
project site area. This is not included, since there
are likely to be many other users as well, and in
each case there will be reduced carbon dioxide
(CO2) emissions from fuel switching. These
emissions are excluded.
B.5.
Details of baseline information, including the date of completion of the baseline study
and the name of person (s)/entity (ies) determining the baseline:
Date of completing the final draft of this baseline section: 30/08/2004
Name of person/entity determining the baseline:
Mara Margarita Cabrera, MGM International
Carrera 43 # 7-50 Torre Financiera Dann, Medelln, Colombia
Tel: (57) -4- 2662269
e-mail: mcabrera@mgminter.com
Mara Florencia Clavin, Marisa Zaragozi, and Fabin Gaioli, MGM International SRL
Junn 1655, 1 B
C1113AAQ, Buenos Aires, Argentina
Tel./Fax: (54 11) 5219-1230/32
e-mail: fclavin@mgminter.com
mzaragozi@mgminter.com
fgaioli@mgminter.com
Mara Margarita Cabrera, Mara Florencia Clavin, Marisa Zaragozi, and Fabin Gaioli are not project
participants.

CDM Executive Board
page 25
SECTION C. Duration of the project activity / Crediting period

C.1
Duration of the project activity:

C.1.1. Starting date of the project activity:
The project started in the year 2003.

Table 15 shows when the different industrial facilities started consuming natural gas.
Table 15: starting of natural gas consumption
Company
Date
Bavaria
Dec-03
Icollantas
Dec-03
Peldar
Sep-04
Proalco
Dec-03
Suizo
Dec-03
Sigra
May-03
Alpina
Nov-04
Protela
Nov-03
C.1.2. Expected operational lifetime of the project activity:

30 years
C.2
Choice of the crediting period and related information:
Fixed crediting period

C.2.1. Renewable crediting period
C.2.1.1.
Starting date of the first crediting period:
C.2.1.2.
Length of the first crediting period:
N/A
N/A

CDM Executive Board
page 26
C.2.2. Fixed crediting period:

C.2.2.1.
Starting date:
C.2.2.2.
Length:
01/01/2004
10 years

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page 27
SECTION D. Application of a monitoring methodology and plan

D.1.
Name and reference of approved monitoring methodology applied to the project activity:
The project activity uses an already existing monitoring methodology (AM0008), which has been
approved and made publicly available by the CDM Executive Board in June 2004. The monitoring
methodology is designated Industrial fuel switching from coal and petroleum fuels to natural gas
without extension of capacity and lifetime of the facility.
D.2.
Justification of the choice of the methodology and why it is applicable to the project
activity:
The methodology AM0008 is applicable to a project activity, which is to switch the industrial fuel
currently used in some element processes of a facility to natural gas from coal and/or petroleum fuels
that would otherwise continue to be used during the crediting period under the following conditions:
The local regulations/programs do not constrain the facility from using coal/petroleum fuels;
Use of coal and/or petroleum fuels is less expensive than natural gas per unit of energy in the
country and sector;
The facility would not have major efficiency improvements during the crediting period;
The project activity does not increase the capacity of final outputs and lifetime of the existing
facility during the crediting period, and
The proposed project activity is defined as fuel switching applied to element processes and does
not result in integrated process change, except for possible changes in other energy use associated
to fuel switching.
As mentioned above, the proposed project activity involves fuel switching from residual fuel oil to
natural gas at eight industrial facilities. The project does not result in integrated process change, but
only involves fuel switching of equipment through its conversion.
The continuation of the current situation is in line with applicable regulations in Colombia. Legally
binding norms established by the government that can be related to the project activity are those
dealing with air quality, under the authority of the Ministry of Environment, Housing, and Spatial
Planning. Neither of these norms constrains the facility from using residual fuel oil. The continuation
of the current situation is not prevented by regulations.
Residual fuel oil is cheaper than natural gas in the region. Moreover, fuel substitution from fuel oil to
natural gas would require investment for the conversion of the existing equipment. The additional
investment and higher fuel cost imply that the project would not be cost effective.
The companies does not expect to increase the capacity of final outputs or the lifetime of the existing
facilities during the crediting period, because the lifetime of existing equipment of the plants are
longer than the crediting period.
Additionally, the companies do not expect to carry out significant efficiency improvements. There will
be only the minor energy savings inherent to switching residual fuel oil to natural gas.
Thus the proposed project activity meets the conditions under which the methodology AM0008 is
applicable.

CDM Executive Board
page 28
D.2. 1. Option 1: Monitoring of the emissions in the project scenario and the baseline scenario
The monitoring procedure and data recording will be carried out by each industrial facility.
D.2.1.1. Data to be collected in order to monitor emissions from the project activity, and how this data will be archived:
ID number
(Please use
numbers to
Data variable
ease crossreferencing
to D.3)
1
Source of
data
Quantity of natural gas Industrial

consumed at the
facilities
element process n
following project
implementation
Data unit
Measure
d (m),
calculate
d (c) or
estimated
(e)
m3
How will the

data be
archived?
(electronic/
paper)
Recording
Frequency
Proportion
of data to
be
monitored
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
m3
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
tCO2e
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
PFCNG n
2
Industrial
Total quantity of
facilities
natural gas consumed
at the industrial facility
following project
implementation
PFCNG
Project emissions
E
Industrial
facilities
Data will be archived until two years after finishing the crediting period.
Comment
This value will be monitored

by element process.
Before calculation of project
emissions, it shall be
converted to energy units
(GJ) by multiplying by its
Lower Heating Value.
Before calculation of project
emissions, it shall be
converted to energy units
(GJ) by multiplying by its
Lower Heating Value.
It shall be confirmed by
natural gas purchase record.
It will be calculated using
data 2, as explained in
Section D.2.1.2.

CDM Executive Board
page 29
D.2.1.2. Description of formulae used to estimate project emissions (for each gas,
source, formulae/algorithm, emissions units of CO2 equ.)
Project GHG emissions within the project boundary correspond to emissions from fuel combustion by
equipment of the industrial facility following project implementation.
The project emissions E (tCO2e/year) are given by:
E =PFCNG [CEFNG OFNG + MEFNG GWP (CH4) + NEFNG GWP (N2O)]
(1)
where:
PFCNG
Total consumption of natural gas at the industrial facility in the project scenario, in
energy units (GJ/year) and based on lower heating value
CEFNG
Carbon dioxide emission factor per unit energy of combusted natural gas (tCO2e/GJ)
OFNG
Oxidation factor for natural gas
MEFNG
Methane emission factor per unit energy of combusted natural gas (tCH4/GJ)
GWP (CH4)
Global warming potential of CH4 set as 21 tCO2e/tCH4 for the 1st commitment period
NEFNG
Nitrous oxide emission factor per unit energy of combusted natural gas (tN2O/GJ)
GWP (N2O)
Global warming potential of N2O set as 310 tCO2e/tN2O for the 1st commitment period
Ex-ante project emissions are determined through equation (1) above, using estimated values of total
project natural gas consumption at the industrial facility.
Natural gas consumption is estimated ex-ante in such a way that the total heat output of each element
process is the same in the baseline and project scenarios.
For each element process n, fuel consumption in the baseline and project scenarios are linked with the
following constraint relation:
BFCRFOn RFOn = PFCNGn NGn
(2)
where:
BFCRFO n
Consumption of residual fuel oil at the element process n in the baseline scenario, in
PFCNG n
Consumption of natural gas at the element process n in the project scenario, in energy
units (GJ/year) and based on lower heating value
RFO n
Efficiency of the element process n using residual fuel oil in the baseline scenario,
based on lower heating value
NG n
Efficiency of the element process n using natural gas in the project scenario, based on
lower heating value

CDM Executive Board
page 30
Baseline residual fuel oil consumption at each element process during the crediting period is estimated
according to historical data and using the fuel consumption growth rate foreseen by the company.
Efficiency of each element process using residual fuel oil in the baseline is also determined from
historical data of the company or taking into account conservative assumptions and it will be
considered fixed along the crediting period7.
In addition, estimated efficiency of each element process using natural gas in the project is considered
in the ex-ante estimation of project natural gas consumption.
The ex-ante project natural gas consumption of the element process n is estimated using equation (2),
as follows:
PFCNGn = (BFCRFOn RFOn) / NGn
(3)
Thus, ex-ante total project natural gas consumption is obtained as follows:

PFCNG = n PFCNGn
(4)
where:
PFCNGn
Following project implementation, natural gas consumption will be monitored by element process.
Total natural gas consumption at the industrial facility will be also monitored, and the measured values
will be used for the ex-post calculation of project emissions using equation (1) above.
In addition, total natural gas consumption at the industrial facility shall be confirmed using equation
(4) above.
AM0008 states that baseline efficiencies should be determined by measurements carried out prior to fuel
switching as a function of the load factor. However, since this is a retroactive project, it is not possible to
measure such efficiencies. Thus, conservative assumptions are considered in order to determine emission
reduction.

CDM Executive Board
page 31
D.2.1.3. Relevant data necessary for determining the baseline of anthropogenic emissions by sources of GHGs within the project
boundary and how such data will be collected and archived:
ID number
(Please use
numbers to
ease cross- Data variable
referencing
to table
D.3)
1
Quantity of natural
gas consumed at the
element process n
following project
implementation
Measured
(m),
calculated
(c), or
estimated
(e),
Proportion
Recording of data to How will the data
be archived?
frequency be
(electronic/ paper)
monitored
Industrial m3
facilities
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
Industrial %
facilities
Once at
the early
stage of
the
crediting
period
100%
Paper (field
record)
Electronic
(spreadsheet)
Source of
data
Data unit
PFCNG n
4
Efficiency of the
element process n
using natural gas
following project
implementation
NG n
Comment
This value will be monitored by

element process.
Before calculation of baseline
emissions, it shall be converted
to energy units (GJ) by
multiplying by its Lower
Heating Value.
The measurement of efficiency
will be carried out for each
element process as a function of
the load factor in order to
determine the average efficiency
of the representative operating
mode of the element process
using natural gas.
It is based on Lower Heating
Value.

CDM Executive Board
Quantity of residual
fuel oil consumed at
the element process
n in the baseline
page 32
Industrial GJ
facilities
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
It will be calculated by element

process using data number 1
and 4 as explained in Section
D.2.1.4.
Industrial GJ
facilities
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
It will be calculated using data

number 5 as explained in
Section D.2.1.4.
Industrial tCO2e
facilities
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
It will be calculated using data

6 as explained in Section
D.2.1.4.
BFCRFO n
6
Total quantity of
residual fuel oil
consumed at the
industrial facility in
the baseline
BFCRFO
Baseline emissions
BE

CDM Executive Board
page 33
D.2.1.4. Description of formulae used to estimate baseline emissions (for each

gas, source, formulae/algorithm, emissions units of CO2 equ.)
Baseline GHG emissions within the project boundary correspond to emissions from fuel combustion
by equipment of the industrial facility prior to project implementation.
Baseline emissions BE (tCO2e/year) are given by:
BE = BFCRFO [CEFRFO OFRFO + MEFRFO GWP (CH4) + NEFRFO GWP (N2O)]
(5)
where:
BFCRFO
Total consumption of residual fuel oil at the industrial facility in the baseline scenario,
in energy units (GJ/year) and based on lower heating value
CEFRFO
Carbon dioxide emission factor per unit energy of residual fuel oil (tCO2/GJ)
OFRFO
Oxidation factor for residual fuel oil
MEFRFO
Methane emission factor per unit energy of residual fuel oil (tCH4/GJ)
GWP (CH4)
NEFRFO
Nitrous oxide emission factor per unit of energy of residual fuel oil (tN2O/GJ)
GWP (N2O)
Global warming potential of N2O set as 310 tCO2e/tN2O for the 1st commitment
period
Ex-ante baseline emissions are determined through equation (5) above, using values of total baseline
residual fuel oil consumption at the industrial facility estimated according to historical data and using
the fuel consumption growth rate foreseen by the company.
The ex-post baseline emissions will be calculated through equation (5) above, using values of total
baseline residual fuel oil consumption determined in a dynamic manner from monitored project data.
Baseline residual fuel oil consumption will be determined ex-post in such a way that the heat output of
each element process is the same in baseline and project scenarios. In other words, baseline emissions
related to fuel consumption would correspond to the consumption of fuel used in the baseline scenario
in order to provide the same amount of heat as is actually measured in the project scenario.
constraint relation showed in equation (2):
(2)
where:
BFCRFO n

CDM Executive Board
page 34
PFCNG n
RFO n
Efficiency of the element process n using residual fuel oil in the baseline scenario,
NG n
Efficiency of the element process n using natural gas in the project scenario, based on
lower heating value
As mentioned above, the efficiency of each element process using residual fuel oil in the baseline is
determined ex-ante from historical data of the company or taking into account conservative
assumptions, and it will be considered fixed along the crediting period8.
In another way, following project implementation, the efficiency of each element process using natural
gas will be measured as a function of the load factor. These measurements will be carried out at the
early stage of the crediting period, enabling the determination of the average efficiency corresponding
to the representative operating mode of the element process using natural gas. Such average efficiency
will be considered as the efficiency of the element process using natural in the project scenario during
the crediting period.
Following project implementation, project natural gas consumption of each element process will be
monitored.
Monitored values of project natural gas consumption and determined values of efficiencies in the
baseline and project scenarios will be used to calculate the ex-post baseline residual fuel oil
consumption of the element process n, using equation (2), as follows:
BFCRFOn = PFCNGn NGn / RFOn
(6)
Thus, total baseline residual fuel oil consumption will be obtained as follows:
BFCRFO = n BFCRFOn
(7)
where:
BFCRFO n
AM0008 states that baseline efficiencies should be determined by measurements carried out prior to fuel
switching as a function of the load factor. However, since this is a retroactive project, it is not possible to
measure such efficiencies. Thus, conservative assumptions are considered in order to determine emission
reduction.

CDM Executive Board
page 35
D. 2.2. Option 2: Direct monitoring of emission reductions from the project activity (values should be consistent with those in section E).
D.2.2.1. Data to be collected in order to monitor emissions from the project activity, and how this data will be archived:
ID number
(Please use
numbers to
ease crossreferencing
to table
D.3)
Data
variable
Source of
data
Data
unit
Measured (m),
calculated (c),
estimated (e),
Recording
frequency
Proportion
of data to
be
monitored
How will the data

be archived?
(electronic/
paper)
Comment
N/A
equ.):
D.2.2.2. Description of formulae used to calculate project emissions (for each gas, source, formulae/algorithm, emissions units of CO2
N/A

CDM Executive Board
page 36
D.2.3. Treatment of leakage in the monitoring plan

D.2.3.1. If applicable, please describe the data and information that will be collected in order to monitor leakage effects of the
project activity
ID number
(Please use
numbers to
ease crossreferencing to
table D.3)
2
Data variable
Source of
data
Total quantity of
natural gas
consumed at the
industrial facility
following project
implementation
Industrial m3
facilities
Data
unit
Measured
(m),
calculated
(c) or
estimated
(e)
M
Proportion
Recording of data to
frequency be
monitored
How will the

data be
archived?
(electronic/
paper)
Comment
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
Before calculation of leakage, it shall

be converted to energy units (GJ) by
multiplying by its Lower Heating
Value.
It shall be confirmed by natural gas
purchase record.
Monthly
100%
Paper (field
record)
Electronic
(spreadsheet)
It will be calculated using data 2 as

explained in Section D.2.3.2.
PFCNG
8
Leakage
LE
Industrial tCO2e
facilities

CDM Executive Board
page 37
D.2.3.2. Description of formulae used to estimate leakage (for each gas, source,
formulae/algorithm, emissions units of CO2 equ.)
Fugitive methane emissions from natural gas production, processing, pipeline and distribution are
considered as leakage.
The leakage LE (tCO2e/year) is given by
LE =
PFCNG FENG (CH4) GWP (CH4)
(8)
where:
PFCNG
Total consumption of natural gas in the project scenario, in energy units (GJ/year) and
FENG (CH4)
IPCC default methane emission factor associated with natural gas production,
processing, pipeline and distribution in the project (tCH4/GJ)
GWP (CH4)
Fugitive methane emissions associated with natural gas occur in natural gas production and processing
as well by leakage from the pipeline supplying the project site. These emissions are emitted outside
the project boundary. There would also be fugitive emissions from the natural gas distribution network
within the project site. For simplicity in calculations, we consider all of these fugitive methane
emissions to be outside the project boundary.
Since measured data on natural gas production, processing and pipeline leakage are not available,
standard estimates are used, as suggested in IPCC Guidelines for National Greenhouse Gas Inventories
Volume 3, Reference Manual (1996). Table 1-64, p. 1.131 indicates values corresponding to the Rest
of the world, region where Colombia would fall: 39.59 to 96.00 tonnes of methane per PJ of natural
gas for its production and 116.00 to 340.00 tonnes of methane per PJ of natural gas for its processing,
pipeline and distribution.
Average values of 70.00 tCH4/PJ (0.00007 tCH4/GJ) for natural gas production and 230.00 tCH4/PJ
(0.00023 tCH4/GJ) for natural gas processing, pipeline and distribution are assumed. Thus, for natural
gas production, processing, pipeline and distribution, the methane emission factor considered is 0.0003
tCH4/GJ of natural gas consumption.
In this case, the energy content (GJ) is based on the lower heating value of the fuel.
Thus, to estimate the leakage before and after project implementation it is necessary to calculate the
ex-ante and ex-post consumption of natural gas at the industrial facility, which can be determined as
explained in Section D.2.1.2.

CDM Executive Board
page 38
D.2.4. Description of formulae used to estimate emission reductions for the project
activity (for each gas, source, formulae/algorithm, emissions units of CO2 equ.)
As mentioned above, baseline emissions BE, project emissions E, and leakage LE (tCO2e/year) are
given by:
BE =
BFCRFO [CEFRFO OFRFO + MEFRFO GWP (CH4) + NEFRFO GWP (N2O)]
(5)
E=
PFCNG [CEFNG OFNG + MEFNG GWP (CH4) + NEFNG GWP (N2O)]
(1)
LE =
(8)
Thus the emission reductions ER (tCO2e/year) achieved by the project activity are given by:
ER =
=
BE E LE =
(9)

PFCNG [CEFNG OFGN + MEFNG GWP (CH4) + NEFNG GWP (N2O)]
Total emission reductions should be estimated ex-ante as is shown below in Section E.5, and
determined ex-post as explained in Sections D.2.1.2, D.2.1.4, and D.2.3.2 above.

CDM Executive Board
D.3.
page 39
Quality control (QC) and quality assurance (QA) procedures are being undertaken for data monitored
Data
(Indicate table and
ID number e.g. 3.1.; 3.2.)
Uncertainty level of data

(High/Medium/Low)
1. PFCNG n
Low
2. PFCNG
Low
4. NG n
Low
Explain QA/QC procedures planned for these data, or why such procedures are not necessary.
Natural gas consumption by element process is measured by gas flow meters. These flow meters are calibrated in
Natural Gas Laboratories, accredited as calibration laboratories by the Ministry of Economy of Colombia.
Total natural gas consumption is measured by gas flow meters. The accuracy of this measure will be checked
against fuel purchase records.
Efficiency is obtained by analysis of combustion gases from the element processes.
The companies have a series of internal procedures that ensures data have low uncertainties during monitoring process (see Section D.4)
Emissions of NOx, SOx, and particulate matter will be measured in order to detect environmental impacts of the project and to ensure compliance with
environmental regulations.

CDM Executive Board
page 40
D.4
Please describe the operational and management structure that the project operator will
implement in order to monitor emission reductions and any leakage effects, generated by the
project activity
Each industrial facility has a representative person responsible for the documentation of monitored
data. Gas Natural S.A. E.S.P as bundling agent also has a person responsible for the CDM project
activity, whose mission is to collect all the information that will be entered in a database, and to carry
out internal audits of the industries in order to guarantee the quality of the registries, prior to
Verification by the Operational Entity.
In order to verify data quality, the industries will work in accordance with ISO 9001 Quality
Assurance System, which intends to organize the information through data codification and internal
audits carried out by Gas Natural S.A. E.S.P. in every industry that takes part in this project activity.
Table 16 shows the operational and management structure that will be implemented.
Table 16: operational and management structure for monitoring
Department
Person Responsible
Monitoring
Monitoring Method
Quality, Security and

Service Management
Martn Moreno
Calibration and verification

of rotating meters,
diaphragm meters, and
turbine meters.
Each meter is calibrated at

Gas Natural Laboratories
prior to their installation,
to assure the meters
exactitude.
Measurement Control
Management
Adolfo Villalba
Daily verification of
meters installed at the
industrial facilities.
The meter exactitude is

systematically verified
against a pattern meter
in-situ.
Internal Standard NT-620COL (GNESP)
Quality, Security and

Service Management
Andrs Soto
Fuel Consumption
monitoring in the industrial
facilities.
Audits in order to assure
the correct implementation
of the monitoring
methodology.
The verification structure

that includes the audits is
lead under Gas Natural
PGCM_170_GN and ISO
9001 procedures.
The bundling agent at Gas
Natural collects all the
information from the
industrial facilities
involved in the project
activity.

CDM Executive Board
D.5
page 41
Name of person/entity determining the monitoring methodology:
Mara Margarita Cabrera, MGM International

Carrera 43 # 7-50 Torre Financiera Dann, Medelln, Colombia
Tel: (57) -4- 2662269
e-mail: mcabrera@mgminter.com
Mara Florencia Clavin, Marisa Zaragozi, and Fabin Gaioli, MGM International SRL
Junn 1655, 1 B
C1113AAQ, Buenos Aires, Argentina
Tel./Fax: (54 11) 5219-1230/32
e-mail: fclavin@mgminter.com
mzaragozi@mgminter.com
fgaioli@mgminter.com
Mara Margarita Cabrera, Mara Florencia Clavin, Marisa Zaragozi, and Fabin Gaioli are not project
participants.

CDM Executive Board
page 42
SECTION E. Estimation of GHG emissions by sources

E.1.
Estimate of GHG emissions by sources:
As mentioned in Section D, project GHG emissions within the project boundary correspond to
emissions from fuel combustion by equipment of the industrial facility following project
implementation.
Thus ex-ante project emissions E (tCO2e/year) are given by:
E=
=
(1)
PFCNG (56.1 0,995 + 0.0014 21+ 0.0023 310)/1,000 tCO2e/GJ
As mentioned in Section D, ex-ante project emissions are determined through equation (1) above,
using estimated values of total project natural gas consumption at the industrial facility.
(2)
historical data of the company or taking into account conservative assumptions.
as follows:
(3)
Table 17 shows the efficiency values for each element process before and after project implementation
that are considered for the ex-ante estimation of project emissions.

CDM Executive Board
page 43
Table 17: efficiency values

Element Process
Efficiency using residual fuel oil
Efficiency using natural gas
86.35%
80.73%
79.85%
79.85%
87.02%
83.89%
82.87%
83.57%
0.2873 tonne steam/GJ
68.00%
68.00%
82.84%
82.51%
0.1968 tonne glass/MMBTU
0.2300 tonne glass/MMBTU

PFCNG = n PFCNGn
(4)
The ex-ante estimations of project emissions inside the plants are shown in Table 18 below.

CDM Executive Board
page 44
Table 18: ex-ante project emissions

Bavaria
Element process
Residual fuel
oil
consumption
in the
baseline
(GJ)
Protela
Alpina
Suizo
Proalco
Sigra
Icollantas
Peldar
Total
2004
763,865
49,469
116,718
148,386
34,173
51,683
300,622
176,077
443,994
2,084,986
2005
763,865
49,469
116,718
161,592
34,173
52,830
315,653
176,077
443,994
2,114,371
2006
763,865
49,469
116,718
177,994
34,173
54,003
331,436
176,077
443,994
2,147,728
2007
763,865
52,437
123,721
190,453
34,173
55,202
348,007
176,077
443,994
2,187,929
2008
763,865
55,584
131,144
203,785
34,173
56,427
365,408
176,077
443,994
2,230,456
2009
763,865
55,584
131,144
218,050
34,173
57,680
383,678
176,077
443,994
2,264,244
2010
763,865
55,584
131,144
233,313
34,173
58,960
402,862
176,077
443,994
2,299,972
2011
763,865
55,584
131,144
249,645
34,173
60,269
423,005
176,077
443,994
2,337,756
2012
763,865
55,584
131,144
267,120
34,173
61,607
444,155
176,077
443,994
2,377,720
2013
763,865
55,584
131,144
285,819
34,173
62,975
466,363
176,077
443,994
2,419,993
341,729
571,635
Total
7,638,648 534,348 1,260,742 2,136,157
3,781,190 1,760,768 4,439,938 22,465,155
2004
Natural gas
consumption
2005
in the project
2006
(GJ)
817,041
49,469
121,064
147,143
31,447
51,683
301,824
162,033
379,904
2,061,609
817,041
49,469
121,064
160,239
31,447
52,830
316,915
162,033
379,904
2,090,943
817,041
49,469
121,064
176,503
31,447
54,003
332,761
162,033
379,904
2,124,226
2007
817,041
52,437
128,328
188,858
31,447
55,202
349,399
162,033
379,904
2,164,650
2008
817,041
55,584
136,027
202,078
31,447
56,427
366,869
162,033
379,904
2,207,412
2009
817,041
55,584
136,027
216,223
31,447
57,680
385,213
162,033
379,904
2,241,153
2010
817,041
55,584
136,027
231,359
31,447
58,960
404,473
162,033
379,904
2,276,830
2011
817,041
55,584
136,027
247,554
31,447
60,269
424,697
162,033
379,904
2,314,558
2012
817,041
55,584
136,027
264,883
31,447
61,607
445,932
162,033
379,904
2,354,459
2013
817,041
55,584
136,027
283,425
31,447
62,975
468,228
162,033
379,904
2,396,665
314,474
571,635
Total
8,170,411 534,348 1,307,683 2,118,264
Project
emissions
(tCO2e)
Total
3,796,313 1,620,335 3,799,043 22,232,505
2004
46,213
2,798
6,848
8,323
1,779
2,923
17,072
9,165
21,488
116,609
2005
46,213
2,798
6,848
9,063
1,779
2,988
17,925
9,165
21,488
118,268
2006
46,213
2,798
6,848
9,983
1,779
3,054
18,822
9,165
21,488
120,150
2007
46,213
2,966
7,258
10,682
1,779
3,122
19,763
9,165
21,488
122,437
2008
46,213
3,144
7,694
11,430
1,779
3,192
20,751
9,165
21,488
124,855
2009
46,213
3,144
7,694
12,230
1,779
3,262
21,788
9,165
21,488
126,764
2010
46,213
3,144
7,694
13,086
1,779
3,335
22,878
9,165
21,488
128,782
2011
46,213
3,144
7,694
14,002
1,779
3,409
24,022
9,165
21,488
130,916
2012
46,213
3,144
7,694
14,982
1,779
3,485
25,223
9,165
21,488
133,173
2013
46,213
3,144
7,694
16,031
1,779
3,562
26,484
9,165
21,488
135,560
462,134
30,224
73,965
119,813
17,787
32,333
214,727
91,649
214,881
1,257,513
Thus, the total amount of project GHG emission is expected to be around 1,257,513 tonnes of CO2equivalent over a 10-year crediting period.

CDM Executive Board
E.2.
page 45
Estimated leakage:
As mentioned in Section D, fugitive methane emissions from natural gas production, processing,
pipeline and distribution are considered as leakage.
Thus, the ex-ante leakage LE (tCO2e/year) is given by:
LE =
=
(8)
PFCNG 0.0003 tCH4/GJ 21 tCO2e/tCH4
The ex-ante estimations of leakage are shown in the Table 19:

Table 19: ex-ante leakage
Bavaria
Element process
Protela
Alpina
Suizo
Proalco
Sigra
Icollantas
Peldar
Total
Natural gas 2004

consumption
2005
in the project
2006
(GJ)
817,041
49,469
121,064
147,143
31,447
51,683
301,824
162,033
379,904
2,061,609
817,041
49,469
121,064
160,239
31,447
52,830
316,915
162,033
379,904
2,090,943
817,041
49,469
121,064
176,503
31,447
54,003
332,761
162,033
379,904
2,124,226
2007
817,041
52,437
128,328
188,858
31,447
55,202
349,399
162,033
379,904
2,164,650
2008
817,041
55,584
136,027
202,078
31,447
56,427
366,869
162,033
379,904
2,207,412
2009
817,041
55,584
136,027
216,223
31,447
57,680
385,213
162,033
379,904
2,241,153
2010
817,041
55,584
136,027
231,359
31,447
58,960
404,473
162,033
379,904
2,276,830
2011
817,041
55,584
136,027
247,554
31,447
60,269
424,697
162,033
379,904
2,314,558
2012
817,041
55,584
136,027
264,883
31,447
61,607
445,932
162,033
379,904
2,354,459
2013
817,041
55,584
136,027
283,425
31,447
62,975
468,228
162,033
379,904
2,396,665
8,170,411
534,348
1,307,683
2,118,264
314,474
571,635
3,796,313
1,620,335
2004
5,147
312
763
927
198
326
1,901
1,021
2,393
12,988
2005
5,147
312
763
1,010
198
333
1,997
1,021
2,393
13,173
2006
5,147
312
763
1,112
198
340
2,096
1,021
2,393
13,383
2007
5,147
330
808
1,190
198
348
2,201
1,021
2,393
13,637
2008
5,147
350
857
1,273
198
355
2,311
1,021
2,393
13,907
2009
5,147
350
857
1,362
198
363
2,427
1,021
2,393
14,119
2010
5,147
350
857
1,458
198
371
2,548
1,021
2,393
14,344
2011
5,147
350
857
1,560
198
380
2,676
1,021
2,393
14,582
2012
5,147
350
857
1,669
198
388
2,809
1,021
2,393
14,833
2013
5,147
350
857
1,786
198
397
2,950
1,021
2,393
15,099
51,474
3,366
8,238
13,345
1,981
3,601
23,917
10,208
23,934
140,065
Total
Leakage
(tCO2e)
Total
3,799,043 22,232,505
Thus, the total amount of leakage is expected to be around 140,065 tonnes of CO2-equivalent over a
10-year crediting period.

CDM Executive Board
E.3.
page 46
The sum of E.1 and E.2 representing the project activity emissions:
The ex-ante estimations of total project emissions are the following:

Table 20: ex-ante total project emissions
Bavaria
Element process
Protela
Alpina
Suizo
Proalco
Sigra
Icollantas
Peldar
Total
Total project 2004

emissions
2005
(tCO2e)
2006
51,361
3,110
7,610
9,250
1,977
3,249
18,973
10,186
23,882
129,597
51,361
3,110
7,610
10,073
1,977
3,321
19,922
10,186
23,882
131,441
51,361
3,110
7,610
11,095
1,977
3,395
20,918
10,186
23,882
133,533
2007
51,361
3,296
8,067
11,872
1,977
3,470
21,964
10,186
23,882
136,074
2008
51,361
3,494
8,551
12,703
1,977
3,547
23,062
10,186
23,882
138,762
2009
51,361
3,494
8,551
13,592
1,977
3,626
24,215
10,186
23,882
140,883
2010
51,361
3,494
8,551
14,544
1,977
3,706
25,426
10,186
23,882
143,126
2011
51,361
3,494
8,551
15,562
1,977
3,789
26,697
10,186
23,882
145,497
2012
51,361
3,494
8,551
16,651
1,977
3,873
28,032
10,186
23,882
148,006
2013
51,361
3,494
8,551
17,817
1,977
3,959
29,434
10,186
23,882
150,659
513,608
33,590
82,203
133,158
19,768
35,934
238,643
101,857
238,815
1,397,578
Total
E.4.
Estimated anthropogenic emissions by sources of greenhouse gases of the baseline:
As mentioned in Section D, baseline GHG emissions within the project boundary correspond to
emissions from fuel combustion by equipment of the industrial facility prior to project
implementation.
Thus, ex-ante baseline emissions BE (tCO2e/year) are given by:
BE =
(5)
= BFCRFO (77.37 0,99 + 0.003 21 + 0.0003 310)/1,000 tCO2e/GJ

Ex-ante baseline emissions are determined through equation (6) above, using values of total baseline
residual fuel oil consumption at the industrial facility estimated according to historical data and using
the fuel consumption growth rate foreseen by the company.
The ex-ante estimations of baseline emissions are the following:

CDM Executive Board
page 47
Table 21: ex-ante baseline emissions

Bavaria
Element process
Residual fuel
oil
consumption
in the
baseline
(GJ)
Alpina
Suizo
Proalco
Sigra
Icollantas
Peldar
Total
2004
763,865
49,469
116,718
148,386
34,173
51,683
300,622
176,077
443,994
2,084,986
2005
763,865
49,469
116,718
161,592
34,173
52,830
315,653
176,077
443,994
2,114,371
2006
763,865
49,469
116,718
177,994
34,173
54,003
331,436
176,077
443,994
2,147,728
2007
763,865
52,437
123,721
190,453
34,173
55,202
348,007
176,077
443,994
2,187,929
2008
763,865
55,584
131,144
203,785
34,173
56,427
365,408
176,077
443,994
2,230,456
2009
763,865
55,584
131,144
218,050
34,173
57,680
383,678
176,077
443,994
2,264,244
2010
763,865
55,584
131,144
233,313
34,173
58,960
402,862
176,077
443,994
2,299,972
2011
763,865
55,584
131,144
249,645
34,173
60,269
423,005
176,077
443,994
2,337,756
2012
763,865
55,584
131,144
267,120
34,173
61,607
444,155
176,077
443,994
2,377,720
2013
763,865
55,584
131,144
285,819
34,173
62,975
466,363
176,077
443,994
2,419,993
7,638,648
534,348
1,260,742
2,136,157
341,729
571,635
3,781,190
1,760,768
2004
58,628
3,797
8,958
11,389
2,623
3,967
23,073
13,514
34,078
160,027
2005
58,628
3,797
8,958
12,403
2,623
4,055
24,227
13,514
34,078
162,283
2006
58,628
3,797
8,958
13,661
2,623
4,145
25,438
13,514
34,078
164,843
2007
58,628
4,025
9,496
14,618
2,623
4,237
26,710
13,514
34,078
167,929
2008
58,628
4,266
10,066
15,641
2,623
4,331
28,046
13,514
34,078
171,193
2009
58,628
4,266
10,066
16,736
2,623
4,427
29,448
13,514
34,078
173,786
2010
58,628
4,266
10,066
17,907
2,623
4,525
30,921
13,514
34,078
176,528
2011
58,628
4,266
10,066
19,161
2,623
4,626
32,467
13,514
34,078
179,428
2012
58,628
4,266
10,066
20,502
2,623
4,728
34,090
13,514
34,078
182,495
2013
58,628
4,266
10,066
21,937
2,623
4,833
35,794
13,514
34,078
185,740
586,284
41,012
96,765
163,955
26,229
43,874
290,215
135,143
340,775
1,724,252
Total
Baseline
emissions
(tCO2e)
Protela
Total
4,439,938 22,465,155
Thus, the total amount of baseline GHG emission is expected to be around 1,724,252 tonnes of CO2equivalent over a 10-year crediting period.
E.5.
Difference between E.4 and E.3 representing the emission reductions of the project
activity:
As mentioned above, baseline emissions BE, project emissions E, and leakage LE (tCO2e/year) are
given by:
BE =
(5)
E=
(1)

CDM Executive Board
LE =
page 48
(8)
Thus the emission reductions ER (tCO2e/year) achieved by the project activity are given by:
ER =
=
BE E LE =
(9)

PFCNG [CEFNG OFGN + MEFNG GWP (CH4) + NEFNG GWP (N2O)]
Thus, ex-ante emission reductions are given by:

ER =
BFCRFO (77.37 0,99 + 0.003 21 + 0.0003 310)/1,000 tCO2e/GJ

PFCNG (56.1 0,995 + 0.0014 21 + 0.0023 310)/1,000 tCO2e/GJ
PFCNG 0.0003 tCH4/GJ 21 tCO2e/tCH4
Ex-ante emissions reductions are determined through equation (9) above, using values of total project
fuel consumption at the industrial facility in the baseline and project scenarios.
Baseline residual fuel oil consumption at the industrial facility is estimated ex-ante according to
historical data and using the fuel consumption growth rate foreseen by the company.
(2)
historical data of the company or taking into account conservative assumptions.
as follows:
(3)

CDM Executive Board
page 49

PFCNG = n PFCNGn
E.6.
(4)
Table providing values obtained when applying formulae above:
The project has the capacity to reduce GHG emissions by 326,675 tCO2e over a 10-year crediting
period.
The results obtained applying the formulae above are shown in the Table 22.
Table 22: ex-ante emission reductions during a 10-year crediting period
(tCO2e)
Year
Baseline
emissions
Project
emissions
Leakage
Emission
reductions
2004
160,027
116,609
12,988
30,431
2005
162,283
118,268
13,173
30,842
2006
164,843
120,150
13,383
31,310
2007
167,929
122,437
13,637
31,855
2008
171,193
124,855
13,907
32,431
2009
173,786
126,764
14,119
32,903
2010
176,528
128,782
14,344
33,402
2011
179,428
130,916
14,582
33,931
2012
182,495
133,173
14,833
34,490
2013
185,740
135,560
15,099
35,081
Total
1,724,252
1,257,513
140,065
326,675

CDM Executive Board
page 50
SECTION F. Environmental impacts

F.1.
Documentation on the analysis of the environmental impacts, including transboundary
impacts:
The substitution of residual fuel oil by natural gas has positive environmental impact on several
grounds.
Residual fuel oil burning produces a number of gaseous and particulate matter emissions that are local
air pollutants. The particulate emissions are almost completely eliminated by switching to natural gas.
Gaseous pollutants are also substantially reduced since natural gas burn cleanlier than residual fuel oil.
Natural gas does not contain lead, vanadium, sulphur, neither aromatic compounds, and it does not
generate ash. The substitution by natural gas propitiates a reduction in emissions of particulate matter
PM-2.5 and PM-10, whose are included between the most important contaminants of the air.
In addition, eliminating residual fuel oil use at the plant reduces residual fuel oil consumption and thus
the environmental impact of fuel transportation to the plant sites is eliminated.
The project implementation involves the construction of a gas distribution network at the industrial
sites and the installation of equipment permitting the use of natural gas. The environmental impact of
these activities is expected to be insignificant.
F.2.
If environmental impacts are considered significant by the project participants or the
host Party, please provide conclusions and all references to support documentation of an
environmental impact assessment undertaken in accordance with the procedures as required by
the host Party:
No significant negative environmental impact is expected from project activities and an environmental
impact study is not required by Colombian authorities.

CDM Executive Board
page 51
SECTION G. Stakeholders comments

G.1.
Brief description how comments by local stakeholders have been invited and compiled:
Umbrella Fuel-Switching Project begun to be known in October 2003, when some presentations took
place in several events and institutions, in order to popularize this project as first of a kind, at
national level.
Some of the presentations that were carried out since October 2003 until July 2005 are the following:
Presentation to the World Bank
Presentation to ECOPETROL
Presentation in Clean Air Initiative Comity, organized by the Administrative Department of

Environment and the Business Camera of Bogot
Presentation in the II International Congress of Eco-efficiency and Environment, organized by

the National Industrial Association and the Ministry of Environment, Housing and Spatial
Planning
Presentation at Climate Change and Kyoto Protocol: The CDM organized by the Chamber
of Commerce of Bogot and the Environmental Business Corporation
The process followed to collect stakeholders comments for Umbrella Fuel-Switching Project was
carried out through a survey. The following set of questions was sent to the group of stakeholders
identified through the previous divulgation stage, above mentioned:
1. According to the information you have at your disposal and your knowledge about issues
related to Environment, Climate Change, Kyoto Protocol, Clean Development Mechanism and
Carbon Market; express briefly your opinion on Umbrella Fuel-Switching Project.
2. Would you recommend to private parties, governmental authorities or other organizations to
develop this kind of projects (fuel switching projects as a CDM)?
3. Do you consider that Umbrella Fuel Switching Project will contribute to social, economic and
environmental development (Sustainable Development) of Cundinamarca Department and
Colombia itself?
4. How does the Fuel Switching Project development affect (positively or negatively) yourself or
your environment?
5. Any additional comments you would like to express
Table 23 shows the list of stakeholders that answer the questionnaire.

CDM Executive Board
page 52
Table 23: stakeholders

Name
Position
1 Guillermo Gmez Canales
Lawyer
Smurfit Cartn de Colombia
2 Juan David Echeverry
Engineer Natural Gas

Transaction Area
3 Mnica Hernndez Soloza
Environmental Management
and Occupational Health
Coordinator
Public Companies of
Medelln ESP- EEPPM
Fundiciones y Componentes
Automotores S.A.FUNDICOM S.A.
4 Harold Humberto Hernandez
Advisory
GTZ
5 Leonardo Gonzlez Ruiz
President
La Salle University
Environmental and Sanitary
Engineers Association
6 Andrs Enrique Palacios

Snchez
HSE Coordinator
Petrominerales Colombia
Limited
7 Ciro Antonio Florez Casa
Teacher
Pamplona University
8 Maria Isabel Arango Uribe
Environmental Unit
Coordinator
Several Companies of
Medelln ESP- EEVVM
9 Nilsa Rossana Garcia B
Environmental Specialist
Consultora y Medio
Ambiente LTDA
10 Santiago Madrin de la
Torre
Executive Director
CECODES Consejo
Empresarial Colombiano para
el Desarrollo Sostenible
11 Francisco Canal Albn
ASOCARS
12 Adrian Cardona Alzate
Assessor
Programa Ambiental de la
Agencia Alemana de
Cooperacin al Desarrollo
(GTZ)
13 Carol Andrea Rojas

Rodriguez
Environmental Engineer
Auditoria Ambiental Ltd.
14 Sarita Guzmn Martnez
Certification Coordinator
Cotecna Certificadora
Services Ltda..
15 Jorge Andres Castro Rivera
Project Coordinator
Estudios Tcnicos Ambiental

y Calidad S.A.
16 Harold Coronado
Program Coordinator
Uniandes
17 Olga Luca Vlez A. and

Jorge A. Arboleda G.
Planning Specialists
Empresas Pblicas de
Medelln E. S. P.
18 Germn Daro Fajardo

Barreto
Assessor/Technical Secretary
Comisin Colombiana del

Ocano-CCO
19 Company management
G.2.
Company / Institution
Ecopetrol
Summary of the comments received:
Table 24 shows a synthesis of the comments received.

CDM Executive Board
page 53
Table 24: stakeholders comments

Question N
1 According to
the information
you have at
your disposal
and your
knowledge
about issues
related to
Environment,
Climate
Change, Kyoto
Protocol, Clean
Development
Mechanism and
Carbon Market;
express briefly
your opinion on
Umbrella FuelSwitching
Project.
Synthesis of the opinions received

1 The project obeys to the KP, ratified by Colombia. It benefits the community itself.
2 The project encompasses an important stage on pollution prevention of the region and it will encourage
other industries to take part in a CDM project.
3 This project clearly shows the opportunity Colombia has to invest in projects that improves the
environment by reducing pollution. It encourages other industries to carry out CDM projects.
4 This kind of projects would be successful and will encourage other initiatives.
5 It is an interesting option that should be rapidly structured so that small industries can receive the
economical benefits also.
6 The project clearly contributes to the mitigation of climate change, by reducing GHG emissions, along
with particulate matter and sulphur dioxides. It improves air quality and public health.
Regarding KP, it obeys to its stipulations as an umbrella project and also contributes to reducing GHG
emissions that can be sold as CERs.
7 It is the best proposed alternative nowadays.
8 Colombia has a lot of steps to implement yet, to reduce GHG emissions and, this kind of projects help,
not only to global health, but also to Colombian technology improvement and it fosters the income from
foreign funds, regarding to CDM.
9 It is an interesting project. It will bring local and global environmental benefits, and it contributes to
sustainable development.
10 Umbrella Project reduces emissions by bundling emission reductions from different industries,
achieving Kyoto reduction objectives.
11 Umbrella Project represents an important contribution to the community, because it encourages other
industries to carry out this kind of projects and brings social and environmental benefits.
12 This kind of CDM projects should be promoted among the industries.
13 It represents the international recognition of the country because it reflects its commitment with
environmental care, promoting sustainable development.
14 The project brings biophysics and economic benefits.
15 It is important for Colombia to carry out CDM projects because they promote sustainable development
and the inherent benefits of reducing pollution for the surrounding communities.
16 It is a good project. CDM projects should include public transport emission reductions projects.
17 It is innovative since the project involves several kinds of industries. This initiative may be replicated
by other industrial regions of the country.
18 This kind of projects contributes to the development of new use and conservation schemes of natural
resources. This is important for Latin-American governments.
19 It is important to join different industries in the project. It is important to measure emissions by sources.

CDM Executive Board
2 Would you
recommend to
private parties,
governmental
authorities or
other
organizations to
develop this
kind of projects
(fuel switching
projects as a
CDM)?
page 54
1 The development of this kind of projects is necessary.

2 Yes.
3 Yes, especially because of the high investment costs that would prevent this projects from being done.
4 Yes.
5 Yes, but it would be necessary to know methodologies, economic warranties, policies of procedures, fuel
indicators, among others.
6 Yes, because of the inherent economical and environmental benefits. It also brings social benefits related
to health conditions at local and national level.
The project represents the national and international acknowledge of the industries.
7 Yes, I would.
8 Yes. I would recommend carrying out these kinds of projects to all industries that have GHG emissions
from fuels higher than natural gas emissions.
9 Yes.
10 Yes. Cecodes considers that is easiest to carry out a project that groups several small ones than one big
project.
11 Yes.
12 Yes. Government should promote the use of alternative fuels and clean energy.
13 Yes.
14 Yes. It promotes clean production and shows the industries concern on protecting the environment.
15 Yes. These projects are recommendable because of the pollution reduction in the main cities of the
country.
16 Yes, it is important to develop this kind of projects.
17 Yes. The project brings environmental benefits and also economic benefits for project proponents.
18 This alternative should be spread in order to be known especially by private sector.
19 Yes, due the environmental benefits and the more rational fuel use in Colombia.

CDM Executive Board
3 Do you
consider that
Umbrella Fuel
Switching
Project will
contribute to
social,
economic and
environmental
development
(Sustainable
Development)
of
Cundinamarca
Department and
Colombia
itself?
page 55
1 It contributes to the sustainable development of the region.

2 Yes
3 Yes, it brings social and environmental benefits because of GHG emission reductions.
4 Yes, it will bring benefits not only regionally but to the country itself.
5 Not in every way. The coal production of Boyac could be affected. Social benefits are not remarkable.
Are the natural gas reservoirs enough in the long-term? Or just in the mid-term?
6 Improvement of life quality, specifically in issues like Public Health, Sustainable Development and
Corporate Social Responsibility. Besides, it contributes to reduce GHG emissions.
7 Yes, it will contribute in a remarkable way.
8 Yes, as long as new technology is implemented and revenues from foreign funds are received.
9 Technological improvements resulting from fuel switching are beneficial to the country.
10 Yes. It contributes to a better life quality of the communities, including other benefits such as making
available gas supply for these communities. It is a sustainable developed project.
11 Yes. This kind of projects promotes sustainable development.
12 It will contribute to technology change in the companies involved and to local air quality.
13 It makes Colombia a leader in achieving Kyoto objectives, internationally. Regionally, it brings many
benefits to the industries and the community.
14 This kind of project is useful as an experience on the application of clean production technology that,
also, consolidates sustainable development.
15 Yes. It contributes to sustainable development of the region and encourages other industries to carry out
CDM project activities.
16 Yes, this kind of projects contributes to sustainable development of the country.
17 Yes, because it brings environmental benefits, as well as social benefits (reduction of problems related
to global climate change like floods and droughts, improvement of health conditions due to the reduction of
contaminants to local air) and economic benefits (less dependency on fossil fuels, less operation and
maintenance costs, and better image of the company into the local community).
18 I am sure that this kind of initiatives will obligate that the use and regulation schemes of natural
resources were improved, and bring economic incentives.
19 Yes, principally due to the environmental benefits, but it has a negative impact in small local coal
producers that are no able to export.

CDM Executive Board
4 How does the

Fuel Switching
Project
development
affect
(positively or
negatively)
yourself or your
environment?
page 56
1 Positively.
2 The project brings benefits for the community, the industries and national institutions related to
improvement of life quality, reduction of pollution.
3 Positively. The country itself will be benefited by the development of this project due to pollutants
reduction, improvement of health conditions and sustainable development of the region.
4 Positively. Improvement of regional and global environmental conditions.
5 It affects positively, mainly because this kind of projects encourage other industries to take part in a
CDM project.
6 The increase of industrial activities in Latin-American countries, has forced, not only urban but rural
communities, to re-organize their Spatial Planning initiatives.
In a city, such as Bogot, these initiatives do not reduce pollution levels, so this project affects myself in a
positive way due to the improvement of air quality (decreasing of respiratory diseases). It also promotes
Sustainable Development of the region and encourages other industries to carry out these kind of projects.
7 Positively.
8 The project affects all Colombian citizens in a positive way, due to the reduction of air pollutants and the
improvement of air quality. Besides, GHG emission reductions positively affects to all the citizens of the
world, as this is a way to reduce de greenhouse effect.
9 Positively. The project will reduce pollutant emissions, improving environmental conditions.
10 Umbrella Project positively affects the community, because it reduces CO2 emissions along with other
air pollutants such as sulfur oxides, un-burnt hydrocarbons, particulate matter and tropospheric ozone
generation. This will also diminish respiratory illnesses.
11 Any Project that aims at reducing environmental impacts generates a benefit.
12 The project activity reduces pollution in the cities where the project takes place.
13 It contributes to improving environmental quality, air quality mainly.
14 Fuel substitutions generate economic benefits.
15 Umbrella Project brings benefits for the environment because it reduces pollution, and for the
communities because, by reducing air pollutants, it improves air quality and, therefore, life quality.
16 The project represents a good initiative.
17 This kind of projects has global positive effects since GHG emissions reductions mitigate the global
warming problem.
18 This kind of projects can benefit positively the air quality.
19 It has a positive effect due to the reduction of pollutant to local air, as well as the mitigation of
greenhouse effect. It is important to be pioneer in the country.

CDM Executive Board
5 Any
additional
comments you
would like to
express
page 57
1 This kind of projects should be supported.

2
3 It is expected to expand this kind of projects due to the inherent benefits they bring.
4 I think NGOs and the Government should encourage this kind of projects.
5 There is a concern about natural gas emissions that are not completely studied.
6
7 Congratulations.
8
9
10 Umbrella Project consists of an example of how a joint effort among different industries can contribute
to improvement of the environment, and to achieving a common goal.
11
12 A serious energy policy must be defined in the country.
13 This kind of projects should be replicated.
14 This first experiences will encourage other industries to carry out CDM projects.
15
16 To incorporate more companies.
17 It is necessary a higher divulgation of this project to the industrial sector and regional environmental
authorities.
18
19
G.3.
Report on how due account was taken of any comments received:
Nineteen comments of stakeholders were received. These were all positive comments to the project
activity. Only one of the commentators has raised a question regarding to natural gas availability,
uncontrolled leaks, and effectiveness to provide social benefits. These aspects were taken into account
in the development of this project activity. The government projections of natural gas reserves exceed
the crediting period of this project activity. Potential leaks are accounted for in the methodology.
Moreover the proposed fuel substitution has an important positive impact on air pollution levels and
the Colombian DNA has confirmed that the project contributes to the sustainable development.
One comment has raised the need to measure local pollutant emissions. It has been taken into account
as a part of the monitoring plan of environmental parameters not directly related to GHG emissions.

CDM Executive Board
page 58
Annex 1
CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY
Organization:
GAS NATURAL S.A E.S.P.
Street/P.O.Box:
Calle 71a # 5-38
Building:
Edificio Calimas
City:
Bogot
State/Region:
Cundinamarca
Postfix/ZIP:
Country:
Colombia
Telephone:
(57) 1- 3485500
FAX:
(57) 1-3485512
E-Mail:
URL:
www.gasnatural.com
Represented by:
Title:
Salutation:
Last Name:
Middle Name:
First Name:
Department:
Mobile:
Direct FAX:
Direct tel:
Personal E-Mail:

CDM Executive Board
Organization:
GAS NATURAL
Street/P.O.Box:
Av. America 38. 7
Building:
Gas Natural
City:
Madrid
page 59
State/Region:
Postfix/ZIP:
28028
Country:
Spain
Telephone:
34934025393
FAX:
E-Mail:
URL:
Represented by:
Title:
www.gasnatural.com
Salutation:
Last Name:
Puertas
Middle Name:
First Name:
Juan
Department:
Director technology and environment
Mobile:
Direct FAX:
Direct tel:
34934025393
Personal E-Mail:
jpuertas@gasnatural.com

CDM Executive Board
page 60
Annex 2
INFORMATION REGARDING PUBLIC FUNDING
No funds from public national or international sources were used in any aspect of the proposed
project.

CDM Executive Board
page 61
Annex 3
BASELINE INFORMATION
The key data used to determine the ex-ante baseline scenario are given in Table 25.
Table 25: key data
Data
Value
Data sources
Carbon dioxide emission factor of

residual fuel oil, CEFRFO
77.37 kgCO2/GJ
Ref. 1 Table 1-1 pag 1.13, Residual Fuel

Oil: 21.1 t C/TJ lower heating value basis.
X 44/12 = 77.37 t CO2/TJ.
Oxidation factor of residual fuel oil
0.99
Ref. 1, Table 1-6 page 1.29. Oil and oil

products.
Methane emission factor of residual

fuel oil, MEFRFO
3 kgCH4/TJ
Ref. 1, Table 1-16, p. 1.54. Residual Fuel

Oil Boilers.
Nitrous oxide emission factor of

residual fuel oil, NEFRFO
0.3 kgN2O/TJ
Ref. 1, Table 1.16, p. 1.54. Residual Fuel

Oil Boilers.
Global Warming Potential of

methane, GWP (CH4)
21
Ref. 2, for methane this was 21.
Global Warming Potential of nitrous

oxide, GWP (N2O)
310
Ref. 2, for nitrous oxide this was 310.
References:
1. IPCC Guidelines for National Greenhouse Gas Inventories: Reference Manual

Volume 3 (1996).
2. According to Article 5, section 3 of the Kyoto Protocol, GWP value is as agreed on
at COP3.
In order to calculate ex-ante baseline emissions from fuel combustion, residual fuel oil consumption
during the crediting period is estimated according to the average annual fuel consumption of each
industrial facility calculated from historical data, and considering the annual fuel consumption growth
rate estimated by each company for the next years.
Table 26 shows the average annual fuel consumption and the annual fuel consumption growth rate of
each plant considered for the ex-ante calculation of baseline emissions.

CDM Executive Board
page 62
Table 26: average annual fuel consumption and annual fuel consumption growth rate
Average annual fuel consumption
GJ
Annual fuel consumption growth rate

%
Peldar
443,994
0% (2004-2013)
Sigra
300,622
5.00% (2004-2013)
Protela
166,187
0% (2004-2006)
6% (2006-2008)
0% (2008-2013)
Icollantas
176,077
0% (2004-2013)
Proalco
51,683
2.22% (2004-2013)
Bavaria
763,865
0% (2004-2013)
Suizo
34,173
0% (2004-2013)
Alpina
148,386
8.90% (2004-2005)
10.15% (2005-2006)
7.00% (2006-2013)
Company

CDM Executive Board
page 63
Annex 4
MONITORING PLAN
The Monitoring Plan describes the procedures for data collection, and auditing required for the project,
in order to determine and verify emissions reductions achieved by the project. This project will require
only very straightforward collection of data, described below, most of which is already collected
routinely by the staff of the industrial facilities, where the proposed CDM project is to be
implemented.
The Monitoring Plan (MP) document fulfills the CDM Executive Board requirement that CDM
projects have a clear, credible, and accurate set of monitoring procedures. The purpose of these
procedures is to direct and support continuous monitoring of project performance and periodic
auditing, verification and certification activities to determine project outcomes, in particular in terms
of greenhouse gas (GHG) emission reductions. The MP is a vital component of project design, and as
such is subject to a formal third-party validation process along with the project baseline and other
project design features.9
Managers of the Project must maintain credible, transparent, and adequate data estimation,
measurement, collection, and tracking systems to successfully develop and maintain the proper set of
information to undergo an audit for a greenhouse gas (GHG) emission reduction investment. These
records and monitoring systems are needed to subsequently allow an Operational Entity to verify
project performance as part of the verification and certification process. In particular, this process
reinforces the fact that GHG reductions are real and credible to the buyers of the Certified Emissions
Reductions (CERs). This set of information will be needed to meet the evolving international reporting
standards developed by the UNFCCC.
The document must be used by the project implementers and operators of the Technical Departments
of the industrial facilities. Strict adherence to the guidelines set out in this monitoring plan is necessary
for the project managers and operators to successfully measure and track project impacts for audit
purposes. MGM International will provide capacity building to the Technical Departments of the
industrial facilities, in order to meet the requirements presented in this MP.
The new methodology describes the procedure and equations for calculating project and baseline
emissions from monitored data. For the specific project, the methodology is applied through a
spreadsheet model. The staff responsible for Project monitoring must complete the electronic
worksheets on a monthly basis. The spreadsheet automatically provides annual totals in terms of GHG
reductions achieved through the project.
The model contains a series of worksheets with different functions:
Data entry sheet (Natural Gas Consumption, Efficiency)
Calculation sheets (Natural Gas Emissions, Residual Fuel Oil Emissions)
Result sheet (Emission Reductions)
GHG and other environmental related parameters are monitored and recorded.

CDM Executive Board
page 64
There are worksheets where the user is allowed to enter data. Even in these sheets, only those cells
where the staff of each plant is required to enter data have been left unblocked. All other cells contain
model fixed parameters or computed values that cannot be modified by the staff.
A color-coded key is used to facilitate data input. The key for the code is as follows:
Input Fields: Pale yellow fields indicate cells where project operators are required to supply
data input, as is needed to run the model;
Result Fields: Green fields display key result lines as calculated by the model.
The last sheet shows the results, comparing year-by-year GHG emissions with the project with
baseline values in order to determine annual emissions reductions, shown in the last column.
All electronic data will be backed up on a monthly basis, and two electronic copies of each document
will be kept in different locations (the plant and its respective Head Office). These data will be
archived for two years following the end of the crediting period.
- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - --

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PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

CDM Executive Board

CLEAN DEVELOPMENT MECHANISM

General description of project activity

Application of a baseline methodology

Duration of the project activity / Crediting period

Application of a monitoring methodology and plan

Estimation of GHG emissions by sources

Annex 1: Contact information on participants in the project activity

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

SECTION A. General description of project activity

Title of the project activity:

Umbrella Fuel-Switching Project in Bogot and Cundinamarca

Description of the project activity:

Food industry (mainly milk-derived products).

Food industry (meat-derived products)

Wire production facility

Vegetal and animal fat production facility

Rim production facility

Crystal production facility

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

Table 2: processes and fuel consumption

Baking and glass and wire

Average fuel consumption

Improvement of labor and health conditions of its employees.

Lower maintenance of the equipment.

Lower dirtiness and corrosion at the plants.

Continuous supply of fuel.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

Private or public entity

Gas Natural S.A. E.S.P. (private)

Gas Natural (private)

Technical description of the project activity:

Bogot, Sibate, Sopo, and Cogua

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

Figure 1: map of Colombia showing Cundinamarca Department

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

Figure 2: map of Cundinamarca Department showing its municipalities

A.4.2. Category(ies) of project activity:

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

Table 4: equipment involved

Fire tube, three steps

Fire tube, three steps

Fire tube, two steps

16 burners Korting ZL5 of

6 burners Laidlaw Drew

Installation of Fisher and

Baltur natural gas burner.

Baltur bi-fuel burner.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

Fisher and Honeywell

16 burners of 150,000 Btu/hr

Originally, this furnace

20 burners of 150,000 Btu/hr

Originally, this furnace

Originally, this boiler had

Baltur natural gas burner.

Krom Schoereder and

Baltur natural gas burner.

Baltur bi-fuel burner.

Fisher and Honeywell

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02

4-GT (one standby unit)