VGS Monitoring Report Longhe 1.03MW Hydro Power Project (GS 482)

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1 VGS Monitoring Report Longhe 1.03MW Hydro Power Project (GS 482) 5 th Monitoring Period: 28/07/2014~09/02/2016 Version: 3.0 Date: 06/05/2016 Climate Bridge Ltd.

2 Contents 1. Introduction Monitoring and Crediting Period Document Reference General description of the project Emission Reduction Monitoring Monitoring Plan and data Operational and management structure Quality control (QC) and quality assurance (QA) Emission reductions Calculation Comparison of the actual emission reductions with the estimates in the PDD Sustainable Development Monitoring

3 1. Introduction The purpose of this report is to calculate the emission reductions and sustainable developments achieved by Longhe 1.03MW Hydro Power Project (Gold Standard ID 482) during the monitoring and crediting period covered by this report, and to serve as basis for the verification and issuance of corresponding GS-VER credits. 1.1 Monitoring and Crediting Period 28/07/2014~09/02/ Document Reference Version: 3.0 Date: 06/05/ General description of the project The Longhe 1.03MW Hydro Power Project (hereafter referred to as the project ) developed in Tongdao Dong Autonomous County, Huaihua City, Hunan Province, P.R. China. The project is located on the upstream of Tongdao river within the administrative boundary of Tongdao County, 48 km from Shuangjiang Village of Tongdao County. The geographical coordinates are east longitude and north latitude

4 Figure 2-1 Location of the Project Site This hydro project utilizes water as clean and renewable resource to generate electricity. The water from the river is diverted through the diversion dam and the water diversion system to the power house, fueling the turbines for electricity generation. The total installed capacity of the project is 1.03 MW combing one turbine of 0.4MW and one turbine of 0.63MW, and the annual feed-in electricity is 3,028 MWh. The key technical parameters are listed in the table below. Table 2-1 Technical parameters of the project Item Parameter Water turbine - 2 -

5 Model ZD560-LH-100 ZD560-LH-120 Quantity 1 1 Rated power (kw) Rated water head (m) Rated speed (r/min) Generator Model SF400-14/1430 SF630-20/1730 Quantity 1 1 Rated power (kw) Rated voltage (v) Rated current (A) 722 1,136 Rated speed (r/min) Power factor The generated electricity is transmitted to 35kV Shuangjiang Substation via a 35kV power transmission line and finally reach Central China Power Grid (CCPG), displacing an equivalent amount of power generated from CCPG that mainly dominated by fossil fuel-fired power plants. According to the GS-PDD, the estimated annual emission reductions are 2,583 tco 2 e during the first crediting period. During this monitoring period from 28/07/2014 to 09/02/2016, the total net feed-in electricity is 4, MWh. The construction of the project commenced in July 2007, and its operation started in September Registered as a retroactive Gold Standard project on 10/02/2011, the starting date of the first crediting period is 10/02/2009 with 7 years as the chosen crediting period. The emission reductions during this monitoring period from 28/07/2014 to 09/02/2016 are 3,543 tco 2 e

6 The project contributes to Sustainable Development through the reduction of GHG emissions and other pollutants associated with the standard practice of fossil fuel fired power plants in the region. It also contributes to relieving the electricity shortage by generating reliable electricity for local residents using, promoting the local economy development and improvement of livelihoods by creating job opportunities. Other contribution is related to environmental wellbeing as using hydro power for electricity generation instead of fossil fuel-based consumption. This project contributes to sustainable development in the ethnical minority area based on indicators of local environmental sustainability, social sustainability & development, and economic& technological development. Please refer to the sustainable development matrix for more details. 3. Emission Reduction Monitoring 3.1 Monitoring Plan and data The baseline and monitoring methodology applied for the project is methodology ACM0002 (Version ): Consolidated baseline methodology for grid-connected electricity generation from renewable sources. Relevant data necessary for determining the baseline of emission by sources of GHGs within the project boundary is list below: ID number 1 Data variable Amount of electricity exported to the grid (EG export,y ) Source of data Meter reading Table 3-1 Data related to determine the baseline of emission reductions Data unit MWh Measured (m), calculated (c) estimated (e) m Recording frequency Continuously measured and monthly recorded Data value (28/07/2014~ 27/12/2014); 3, (28/12/2014~ 27/12/2015 ); (28/12/2015~ 09/02/2016) How will the data be archived? (electronic/paper) Paper Comment Electricity monitored by meter reading, and is cross-checked with electricity sales receipt. Please refer to the original data sources from monitoring meter and electricity transaction notes and sales receipts. Data in hard copy is kept for 2 year following the end of the last monitoring 2 Amount of Meter MWh m Continuously Paper Electricity monitored by meter reading, and period.

7 electricity reading measured (28/07/2014~ is cross-checked with electricity sales imported from and monthly 27/12/2014); receipt. Please refer to the original data the grid. recorded sources from monitoring meter and (EG import,y ) (28/12/2014~ electricity transaction notes and sales 27/12/2015 ); receipts Data in hard copy is kept for 2 year (28/12/2015~ following the end of the last monitoring 09/02/2016) period Electricity monitored by meter reading, and (28/07/2014~ is cross-checked with electricity sales 3 Net Electricity supplied to the grid by the project (EG PJ,y ) EG export,y EG import,y MWh c Continuously measured and monthly recorded 27/12/2014); 3, (28/12/2014~ 27/12/2015 ); Paper receipt. Please refer to the original data sources from monitoring meter and electricity transaction notes and sales receipts. Data in hard copy is kept for 2 year (28/12/2015~ following the end of the last monitoring 09/02/2016) period. 4 The installed capacity of the project (Cap PJ ) Name plates of the facility MW m Yearly 2014 year: 1.03 MW; 2015 year: 1.03 MW; 2016 year: 1.03 MW; Electronic The installed capacity of the project is measured by checking the name plates of the facility. The install capacity is totally 1.03 MW (0.63MW + 0.4MW). Please refer to the generators nameplates. 5 The water surface area of the reservoir when it is full (A PJ ) Report issued by a third party m 2 m Yearly 36,900m 2 ( 11/09/2013~ 10/09/2014); 36,200m 2 (11/09/2014~ 10/09/2015); Paper A PJ has been measured by a third party on 11/09/2013, 11/09/2014 and 11/09/2015, and a relevant report/certificate has been issued accordingly. During this monitoring period, the reservoir area monitored on 11/09/2013, - 5 -

8 37,100m 2 (11/09/2015~ 10/09/2016) 11/09/2014 and 11/09/2015 was respectively 36,900m 2, 36,200m 2 and 37,100m 2, thus the power density was accordingly calculated as: 1.03MW 10 6 /36900 m 2 =27.9 W/m 2, 1.03MW 10 6 /36200 m 2 =28.4 W/m 2, 1.03MW 10 6 /37100 m 2 =27.7 W/m 2. The results during the whole verification period are higher than 10W/m 2, therefore, no project emission should be taken into account. Please refer to the monitoring reports for the water surface area of the reservoir

9 CCPG Electricity 35kv Transmission Line Shuangjiang Substation Transformer 0.4kv Transmission Line On-site Booster Station Electricity Project boundary Ma Ma G ~ Monitoring Meter Generator Unit Project site Electricity G ~ G ~ Figure 3-1 Longhe Electricity Connection Diagram As the electricity connection diagram shows, the electricity generated by two generators connects to the grid through an on-site booster station via 35kV transmission line to Shuangjiang Transformer Substation, and finally to the CCPG. Monitoring Meter: A bi-directional revenue meter Ma 1 was equipped at the project site. It measures both the amount of electricity exported to the grid 1 According to the MR of first verification period, the meters M1 and M2 installed on the two 0.4kv transmission lines were used for monitoring the electricity generated by the generators as the reference for the readings of M3. As the accuracy of M1 and M2 was 1.0 which was too low, they were not allowed by the grid company to record electricity. If the main meter M3 was malfunctioned, no emission reduction would be claimed. Thus, M1 and M2 was missing in the following MR accordingly compared with the registered PDD. Meanwhile, according to the MR of fourth verification period, on 22/12/2013, the new revenue meter Ma was equipped and replaced the old one M3 which was removed

10 (EG export,y ) and the amount of electricity imported from the grid (EG import,y ). The readings of Ma should be recorded on a monthly basis as a monthly electricity transaction notes. The electricity sales receipt is served as additional check for quality control. The accuracy of Ma is 0.5s. If the main meter Ma is malfunctioned, no emission reduction will be claimed. During this verification period from 28/07/2014 to 09/02/2016, there is no failure of meter took place. The calibration of the meter has been done by authority in line with the national Chinese standard DL/T The monitoring data including paper and electronic version, electricity sales/purchase receipts of every month and other GS related documents should be archived by the project owner. And all of the materials will be kept until 2 years after the end of the total credit period of the project. Specifications of the revenue meter Ma is listed below: Table 3-2 Specifications of Revenue Meter Ma Meter No. Type Serial Number Accuracy Meter Verifier Calibration Calibration Frequency Date Huaihua Electricity Ma DSZ s Power Bureau 22/12/2013; Tongdao Power yearly 22/12/2014; Company 22/09/2015 Metrological and Verification Institution Cap PJ : The installed capacity of the project (Cap PJ ) is verified on site for the nameplates of generators. A PJ : The water surface area of the reservoir (A PJ ) when it is full is verified on site for year 2013, 2014 and Validity 22/12/2013~21/12/2014; 22/12/2014~21/12/2015; 22/09/2015~21/09/2016 Evidence The photo of revenue meter Ma. The calibration report for Ma during this monitoring period and the Certificate of metrological authorization. For this monitoring period, as no malfunction happened to the revenue meter Ma, therefore the source of data from Ma from 28/07/2014 to 09/02/2016 was used to calculate emission reductions. 3.2 Operational and management structure The monitoring of the emissions reductions is carried out according to the operation and management structure shown in Figure

11 Figure 3-2 Operations and Management Structure 1) The General Manager conducts the overall responsibility for the monitoring process. 2) Station staff serves as the monitoring officer to carry out the measurement of the exports and imports electricity recordings. 3) An accountant worked as internal verifier is responsible for internal verification of the measurement, collection of electricity receipts and invoices and the calculation of the emission reductions. 3.3 Quality control (QC) and quality assurance (QA) Besides data management procedure described above, the project owner also take the following procedures to ensure the operation and accuracy: 1) Revenue Meter Ma is installed in accordance with the national Chinese standard electricity meter installation technical management code (DL/T ). 2) All relevant staff receives training periodically to improve their know-how and performance. Please refer to the training records. 3) A monitoring and management manual of Longhe hydropower station identifying detailed duties and responsibilities of the relevant parties has been developed by Climate Bridge Ltd., and is served as a basis of the project monitoring. Please refer to the monitoring manual. 4) If the revenue meter is detected any failure, the emission reduction during Ma s failure will not be claimed. The faulty meter will be repaired or replaced by the accredited equipment testing organization as soon as possible and the restore process will be written down

12 3.4 Emission reductions Calculation Baseline Emissions (BE y ) The baseline emissions can be calculated as follows: BE EG EF y PJ, y grid, CM, y Where : BE y = Baseline Emissions in year y; (tco 2 e/yr). EG PJ,y = Quantity of net electricity generation supplied by the project plant/unit to the grid in year (MWh/yr). EG PJ,y = EG export,y - EG import,y EF grid,cm,y = Combined margin CO 2 emission factor in year y (tco 2 e/mwh). According to the registered PDD, EF grid,cm,y = tco 2 e/mwh Project Emissions (PE y ) According to ACM0002 (Version ), as a hydropower project the power density of the project is respectively 27.9 W/m 2, 28.4 W/m 2 and 27.7 W/m 2 covering the monitoring period, greater than 10 W/m 2, thus the project emissions resulting from the project are zero. PE y =0 tco 2 e. Leakage (LE y ) According to ACM0002 (Version ), there is no leakage considered, i.e. LE y =0 tco 2 e. Emission Reductions (ER y ) The emission reductions (ER y ) by the project during a given year y are the difference among baseline emissions (BE y ), project emissions (PE y ) and emissions due to leakage (LE y ). The final GHG emission reductions are calculated as follows: ERy BEy PEy LEy Detailed amounts of the recorded electricity generated from the project and calculations of emission reductions are listed below:

13 Table 3-3 Emission reductions from 28/07/2014 to 09/02/2016 Time Period Electricity Exported EG export,y (MWh) Electricity Imported EG import,y (MWh) Net Electricity Supplied EG PJ,y (MWh) Baseline Emissions BE y (tco 2 e) Project Emissions PE y (tco 2 e) Leakage Emissions LE y (tco 2 e) Emission Reductions ER y (tco 2 e) Reading Records EG export,y - EG import,y EG PJ,y EF grid,cm,y / / BE y - PE y - LE y 28/07/ /08/ /08/ /09/ /09/ /10/ /10/ /11/ /11/ /12/ Subtotal /12/ /01/ /01/ /02/ /02/ /03/ /03/ /04/ /04/ /05/ /05/ /06/ /06/ /07/ /07/ /08/ /08/ /09/ /09/ /10/ /10/ /11/ /11/ /12/ Subtotal 3, , , ,646 28/12/ /01/ /01/ /02/ Subtotal

14 Total 4, , , ,543 Emission reductions achieved during this monitoring period are listed as follows: Emissions reductions in 2014 (28/07/ /12/2014) Emissions reductions in 2015 (28/12/ /12/2015) Emissions reductions in 2016 (28/12/ /02/2016) Emission reductions during the 5 th monitoring period (28/07/ /02/2016) 640 tco 2 e 2,646 tco 2 e 257tCO 2 e 3,543 tco 2 e 3.5 Comparison of the actual emission reductions with the estimates in the PDD Table 3-3 Comparison of the actual emission reductions with the estimates in the PDD for this monitoring period (28/07/ /02/2016) Emission reductions for 2014 (tco 2 e) (28/07/ /12/2014) Emission reductions for 2015 (tco 2 e) (28/12/ /12/2015) Emission reductions for 2016 (tco 2 e) (28/12/ /02/2016) Total emission reductions (tco 2 e) (28/07/ /02/2016) Actual emission reductions in this monitoring period Estimated value in the registered PDD 640 (for 153 days) 1,083 (for 153 days) 2,646 (for 365 days) 2,583 (for 365days) 257 (for 44 days) 311 (for 44 days) 3,543 (for 562 days) 3,977 (for 562 days) According to the registered PDD, the annual emission reductions are 2,583tCO 2 e. For the emission reductions of year 2014 (28/07/ /12/2014, 153 days), the estimated emission reductions are calculated as 2,583 tco 2 e/365d 153d=1,083 tco 2 e, which is higher than the actual value 640 tco 2 e. For the emission reductions of year 2015 (28/12/ /12/2015, 365 days), the estimated emission reductions are calculated as 2,

15 tco 2 e/365d 365d=2,583 tco 2 e. The actual emission reduction of 2,646 tco 2 e in 2015 is 2.43% 2 higher than the estimated. The reason is that during the rainy season in 2015 the precipitation is a little bit higher than normal year 3. For the emission reductions of year 2016 (28/12/ /02/2016, 44 days), the estimated emission reductions are calculated as 2,583 tco 2 e/365d 44d=311 tco 2 e. Thus, the actual emission reduction of 3,540 tco 2 e during the monitoring period from 28/07/2014 to 09/02/2016 is 10.91% 4 lower than the estimated value of 3,977 tco 2 e. 4. Sustainable Development Monitoring According to the PDD, a management team led by the general manager has been established for the project to carry out monitoring and internal verification tasks during the operation period. The table below shows the details of the monitoring performance on the sensitive sustainable development indicators. Sustainable Development Indicator Income and number of employees Table 4-1 Data to be collected in order to monitor project performance on the most sensitive sustainable development indicators Social Data type sustainability and development Economic and technological development Data unit Measured (m), calculated (c) or estimated (e) Recording frequency Number M Monthly Methods and equipments used The payroll is served as additional check for the number of employees and their income monitored Monitoring Results The payroll from 2014/08 to 2016/02 shows: 1. Total 4 permanent employees are hired and most employees were from local community. 2. The average salary for employee during the monitoring period is RMB/month, higher than the average level of 1250 RMB/month 5 for civil residents in Tongdao County. Relevant Documents Please refer to monthly payrolls of Longhe hydro power project. Access to Social Number M Monthly The monthly power During the monitoring period, the total Please refer to the electricity 2 (2,646-2,583)/2,583=2.43% (3,977-3,540)/3,977=10.91% 5 The urban per capita disposable income in Tongdao County is 15,005RMB, thus the average month level is 1250 RMB/month =15,005RMB/12 months. Please refer to:

16 energy services sustainability and development sales receipt received from the local grid company are monthly. checked net feed-in electricity is 4, MWh. The PLF is 4, *365d/(1.03MW*8,760h*56 2d)= The sales receipt and the electricity transmission sheets show the amount of feed-in electricity from this project to the grid. This releases the local power supply shortage and reduces the dependence of provincial grid to some extent. transmission sheets and sales receipts. Position for local women Social sustainability and development Number M Monthly The payroll is served as additional check for the number of female employees and their salary packages. According to the monthly payroll, one local woman has been hired as operators. The salary for her is the same as some other employees. Please refer to monthly payrolls of Longhe hydro power project. Training opportunities and certification Economic and technological development Number M Yearly Training reports regarding operation and maintenance. Internal training regarding technology and monitoring are provided to the employees to help them upgrade their skills and knowledge. Evidences including: All the certificates are provided. The period of validity is until 11/2017 or 04/2019 and the latest check is in 11/2014 or 04/2016. Monitoring training record refer to monitoring manual learning on 06/05/2014 and 05/05/2015. Please refer to the training records

17 Yearly technical training explanation provided by the PO on 12/06/2014 and 05/05/2015. All the exam papers for year 2015 are provided

18 Annex: Training records

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