Case study and calculation of carbon credits

Presentation by:Nalin Kanshal Director Elpro Energy Dimensions Pvt.Ltd Bangalore

CLEAN DEVELOPMENT MECHANISM

PROJECT CYCLE

1. Planning a CDM Project Activity

CDM PPs plan a CDM project activity

PPs prepare the PPD for a CDM project

2.Preparing PDD

3.Getting Approval

PPs shall get written approvals of voluntary participation from DNA of each party involved, including host party. PPs may get written approval in step 1,2 or even 4

4.Validation

Validation is the process of independent evaluation of a project activity against the requirement of the CDM

5.Registration

Registration is the formal acceptance of a validate project as CDM project activity

6.Monitoring a CDM Project Activity

PPs collect and archive all relevant data necessary for calculating GHG emission reduction by a CDM project activity in accordance with the monitoring plan in the PDD

7.Verification & Certification

Verification is a Periodic independent review and expost determination of the monitored GHG emission reduction. Certification is the written assurance by a DOE that a project activity achieved the reductions in GHG emissions as verified.

8.Issuance of CERs

The EB will issue CERs equal to the verified amount of GHG emission reductions. Among issued CERs,2% will be deducted for the share of proceed to assist developing countries to meet cost of adaptation

9.Distribution of CERs

CERs will be distributed among PPs

ADDITIONALITY TEST

Revenue from the carbon offsets must be a primary driver for project implementationavailability of a financially more viable alternative that would have led to higher emissions

Local resistance, lack of know-how, institutional or technological barrier -existence of a less technologically advanced alternative involving lower risks in terms of performance or market share and at the same time leading to higher emissions Employ technology that is not very commonly used-prevailing practice or existing regulatory or policy requirements would have led to implementation of a technology with higher emissions CDM concept additionality Project participants have to demonstrate to a validator that the project activity would otherwise not be implemented due to the existence of one or more barriers in order to prove that it is additional to what would have occurred in the absence of the CDM A TOOL IS AVAILABLE TO HELP!

Clean Development Mechanism Baseline Establishing a baseline The amount of emission reduction, obviously, depends on the emissions that would have occurred without the project. The construction of such a hypothetical scenario is known as the baseline of the project. The baseline may be estimated through reference to emissions from similar activities and technologies in the same country or other countries, or to actual emissions prior to project implementation. The partners involved in the project could have an interest in establishing a baseline with high emissions, which would yield a risk of awarding spurious credits. Independent third party verification is meant to ameliorate this potential problem.

Co2 database
Table S-1: Weighted average emission factor, simple operating margin (OM), build margin (BM) and combined margin (CM) of all grids for FY 2007-08 (inter-Grid and cross-border electricity transfers included), in tCO2/MWh
Grid Average OM BM CM

NEWNE Southern India

0.81 0.72 0.79

1.00 0.99 1.00

0.60 0.71 0.63

0.80 0.85 0.81

Average is the average emission of all stations in the grid, weighted by net generation. OM is the average emission from all stations excluding the low cost/must run sources(only thermal excludes hydro and nuclear). BM is the average emission of the 20% (by net generation) most recent capacity addition in the grid. CM is a weighted average of the OM and BM (here weighted 50 : 50). The baseline emission factor which is to be used for calculating CDM Benefits by the supercritical technology based power projects has also been calculated by Central Electricity Authority as 0.941 tCO2/MWh for the year 2007-08 in accordance with CDM Executive Board approved methodology ACM0013. The National average has hence been revised to 0.82 tCO2/MWh as of 2009

What is the Co2 database??

The database is an official publication of the Government of India for the purpose of CDM baselines. It is based on the most recent data available with the Central Electricity Authority. Emission reductions from CDM projects in the power sector are calculated based on the net electricity generated by the project, and the difference between the emission factors (in tCO2/MWh) of the baseline and the project activity. The baseline emission factor reflects the carbon intensity of the displaced amount of grid electricity. This baseline emission factor can be derived from the data provided in the CO2 Database.

Classwork Project Profile

Calculation of Carbon Credits from a typical energy efficiency project in a fertilizer unit in Karnataka state

Project Profile
SECTION A. General description of the small-scale project activity A.1. Title of the small-scale project activity: Energy efficiency measures at Fertilizer unit of XYZ factory in Karnataka A.2. Description of the small-scale project activity: Purpose of the project activity: The main purpose of the project is to carryout energy efficiency measures, at all possible consumption points in the chemical process units at XYZ faxtory, so as to reduce electricity consumption. Reduced consumption of energy will lead to displacing equivalent amount of energy, thus, reducing the consumption of fossil fuel in the power generation in grid. Hence, reducing the GHG emissions due to the burning of fossil fuel. A Total of seven initiatives have been considered under the scope of this CDM project. The projects can be broadly categorized as: 1. Lighting related initiatives 2. Variable Frequency Drives 3. Efficient Motor related Initiatives 4. Other energy efficiency related initiatives

Class Work Assume emission factor 0.72 tco2/mwh

Baseline Ener gy Cons umpti on Projected energ y Cons umpti on Hours of Oper ation Per year

Ref No

Project Measure

Difference in Energ y

Savings

Savings

Emission factor

Emission

(Kwh) P

(Kwh) Q

(kwh) R=P-Q

hrs S

(kwh)/year T=R*S

(mwh)/yr U=T/1000

tCO2/Mwhr V

tCO2/year W=U*V

CDM1A

Replacement of 125 watt HPMV lamps by 70 watt metal halide lamps

125

70

4380

CDM1B

Replacement 250 watt HPMV lamps by 150 watt metal halide lamps:

250

150

4380

CDM2

Replacement of 40 watt T10/T8 tube lights by 28 watt T5 tube lights:

40

28

4380

CDM3

Installation of power saving device for centralized lighting DB at different units:

100

75

4380

CDM4

Installation of variable frequency drive: Replacement of EFF 3 motors with EFF 1: Replacement of higher capacity (150 kw) motors by optimum capacity motor (100 Kw):

500

430

7200

CDM5

1000

700

6700

CDM6

150

100

6200

CDM7

Reduction in power consumption by replacing the existing aluminium blades in cooling tower fan by FRP blades

100

95

5600

Total A. Savi ngs (Mwh/Year ) :

B.

Weighted

Emission Fact or

C.

Emissions tCO 2/ye ar

(C=A*B)

Solution
Baseline Ene rgy Con sum ptio n Projected ener gy Con sum ptio n Difference in Ener gy Hours of Ope ratio n Per year Emission fact or

Ref No

Project Measure

Savings

Savings

Emission

(Kwh) P

(Kwh) Q

(kwh) R=P-Q

hrs S

(kwh)/year T=R*S

(mwh)/yr U=T/1000

tCO2/Mwhr V

tCO2/year W=U*V

CDM1A

Replacement of 125 watt HPMV lamps by 70 watt metal halide lamps

125

70

55

4380

240900

240.9

0.72

173.448

CDM1B

Replacement 250 watt HPMV lamps by 150 watt metal halide lamps:

250

150

100

4380

438000

438

0.72

315.36

CDM2

Replacement of 40 watt T10/T8 tube lights by 28 watt T5 tube lights:

40

28

12

4380

52560

52.56

0.72

37.8432

CDM3

Installation of power saving device for centralized lighting DB at different units:

100

75

25

4380

109500

109.5

0.72

78.84

CDM4

Installation of variable frequency drive: Replacement of EFF 3 motors with EFF 1: Replacement of higher capacity (150 kw) motors by optimum capacity motor (100 Kw): Reduction in power consumption by replacing the existing aluminium blades in cooling tower fan by FRP blades

500

430

70

7200

504000

504

0.72

362.88

CDM5

1000

700

300

6700

2010000

2010

0.72

1447.2

CDM6

150

100

50

6200

310000

310

0.72

223.2

CDM7

100

95

5600

28000

28

0.72

20.16

Total A. Savi ngs (Mwh/Year ) : 3692.96

B.

Weighted

Emission Fact or

0.72

C.

Emissions tCO 2/ye ar

(C=A*B)

2658.9312

THANK YOU