CLEAN DEVELOPMENT MECHANISM SMALL-SCALE PROGRAM ACTIVITY DESIGN DOCUMENT FORM (CDM-SSC-CPA-DD) Version 01 CONTENTS

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1 CDM Executive Board page 1 CLEAN DEVELOPMENT MECHANISM SMALL-SCALE PROGRAM ACTIVITY DESIGN DOCUMENT FORM (CDM-SSC-CPA-DD) Version 01 CONTENTS A. General description of CDM programme activity (CPA) B. Eligibility of CPA and Estimation of Emission Reductions C. Environmental Analysis D. Stakeholder comments Annexes Annex 1: Contact information on entity/individual responsible for the CPA Annex 2: Information regarding public funding Annex 3: Baseline information Annex 4: Monitoring plan NOTE: (i) This form is for submission of CPAs that apply a small scale approved methodology using the provision of the proposed small scale CDM PoA. (ii) The coordinating/managing entity shall prepare a CDM Small Scale Programme Activity Design Document (CDM-SSC-CPA-DD) 1,2 that is specified to the proposed PoA by using the provisions stated in the SSC PoA DD. At the time of requesting registration the SSC PoA DD must be accompanied by a CDM-SSC CPA-DD form that has been specified for the proposed SSC PoA, as well as by one completed CDM-SSC CPA-DD (using a real case). After the first CPA, every CPA that is added over time to the SSC PoA must submit a completed CDM-SSC CPA-DD. 1 The latest version of the template form CDM-CPA-DD is available on the UNFCCC CDM web site in the reference/document section. 2 At the time of requesting validation/registration, the coordinating managing entity is required to submit a completed CDM-POA-DD, the PoA specific CDM-CPA-DD, as well as one of such CDM-CPA-DD completed (using a real case).

2 CDM Executive Board page 2 SECTION A. General description of small scale CDM programme activity (CPA) A.1. Title of the small-scale CPA: >> CPA title Version number of the document: 05 Date: 11/03/2010 Document history: Version 01, date: 07/11/2008 Version 02, date: 17/07/2009 Version 03, date: 27/11/2009 Version 04, date: 04/01/2010 A.2. Description of the small-scale CPA: CPA title is a small run-of-river hydro power plant with an installed capacity of installed capacity CPA connecting to the national Honduran electricity grid. A.3. Entity/individual responsible for the small-scale CPA: CPA entity name A.4. Technical description of the small-scale CPA: The CPA entity name uses water from the river river name to generate electricity. From the water intake water the water flow is diverted to the power plant, always leaving a minimum residual flow in the natural river bed. The water is conducted through a penstock distance entry meters to the power house. 3 The airline distance from water intake to power house is distance entry meters. 4 One or more turbine type turbines and (a) suitable generator(s) are located in the power house. 5 From there the plant connects to the next nearby power sub-station through a new or modified existing power line. A discharge channel returns the water to the natural river bed. The distance from the water intake to the discharge is distance entry meters. 6 An implementation timeline is provided to the validating DOE. A.4.1. Identification of the small-scale CPA: A Host Party: Honduras 3 Source 4 Source 5 Source 6 Source

3 CDM Executive Board page 3 A Geographic reference or other means of identification allowing the unique identification of the small-scale CPA (maximum one page): CPA title is located in CPA location, Honduras. The project is located at points of reference CPA. The projects unique identification is the location of its power house at CPA coordinates and the location of its water intake at CPA coordinates (See below Figure 1 and 2). Country map with CPA location Figure 1: Project location. Source Google Earth. Regional map with CPA location Figure 2: Location of the project. Source Environmental Assessment. dd/mm/yyyy A.4.2. Duration of the small-scale CPA: A Starting date of the small-scale CPA: The project entity s intention to implement the project was in consideration of CDM. The DNA was notified of the intention of seeking CDM status as well as the commencement of the project activity on the 26/11/2008. CPA lifetime Renewable crediting period A Expected operational lifetime of the small-scale CPA: A.4.3. Choice of the crediting period and related information: A Starting date of the crediting period: Later of dd/mm/yyyy, or inclusion date A Length of the crediting period, first crediting period if the choice is renewable CP: 7 years

4 CDM Executive Board page 4 A.4.4. Estimated amount of emission reductions over the chosen crediting period: Table 1: Estimated amount of emission reductions over the chosen crediting period Year Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Total emission reductions (t CO 2 ) Annual estimation of emission reductions in tonnes of CO 2 Total number of crediting years 7 Annual average over the crediting period of estimated reductions (t CO 2 ) A.4.5. Public funding of the CPA: >> The project does not receive public funding. A.4.6. Information to confirm that the proposed small-scale CPA is not a de-bundled component Specific information on de-bundling for the CPA, include distance table Table 2. Distance (km) of CPA name to CDM activity of the same activity implementer or managing entity managing a PoA of the same sectoral scope A.4.7. Confirmation that small-scale CPA is neither registered as an individual CDM project activity or is part of another Registered PoA: The present small-scale CPA is not registered as an individual CDM project and is not part of another PoA. SECTION B. Eligibility of small-scale CPA and Estimation of emissions reductions B.1. Title and reference of the Registered PoA to which small-scale CPA is added: >> Masca Small Hydro Programme

5 CDM Executive Board page 5 B.2. : Justification of the why the small-scale CPA is eligible to be included in the Registered PoA CPA title is eligible to be included to the Masca Small Hydro Programme because: 1. It is a run-of-river hydro power plant, with a hydraulic head in the river to divert some portion of the river flow, no storage reservoir or limited daily poundage, and thereby falling within the scope of by the definition set by the World Commission of Dams ; 2. The plant is newly built and does not involve the retrofitting or modification of an existing facility for renewable energy generation; 3. No energy generating equipment is transferred from another activity and no existing equipment is transferred to another activity. 4. It has an installed capacity of installed capacity CPA which is less than 15MW; 5. It connects to the national Honduran electricity grid; 6. CPA entity name has contractually ceded its rights to claim and own emission reductions under the Clean Development Mechanism of the UNFCCC to the managing entity of the Masca Small Hydro Programme; 7. The CPA implementer has not seriously considered grid connected electricity generation with a different technology as an alternative to the project. This is supported by a written statement by CPA entity name. B.3. Assessment and demonstration of additionality of the small-scale CPA, as per eligibility criteria listed in the Registered PoA: >> The proposed CPA would not have occurred anyway without CDM income due the following barriers which are in line with section E.5.2 of the Hidromasca PoA DD: Elaborate if Step 2 Investment Analysis, or Step 3, Barrier Analysis, or both steps of the Tool for the demonstration and assessment of additionality (Version 05.2) are applied and perform the step(s) chosen as outlined in the below.. Step 2: Investment analysis This analysis is carried out along the guidelines of step 2 of the methodological tool Tool for the demonstration and assessment of additionality (Version 05.2). The procedure is presented in the Masca Small Hydro PoA DD, section E.5.1. Sub-step 2a: Determine appropriate analysis method Small hydro projects do generate financial benefits from the sale of electricity and therefore simple cost analysis can not be applied. Since the only alternative to the implementation of the CPA title under this PoA is their implementation without CDM revenues, an investment comparison analysis is not appropriate either. The appropriate analysis method is the benchmark analysis (Option III). 7 World Commission on Dams WCD (2000). Dams and development: a new framework for decision making. Earthscan Publications. London, U.K: (Accessed 29/04/2009)

6 CDM Executive Board page 6 Sub-step 2b: Option III. Apply benchmark analysis The following benchmark analysis applies the equity IRR as benchmark, as explained and stated in the PoA DD. The discount rates and benchmarks shall thereby be arrived at according to Option (a) from the Tool for the demonstration and assessment of additionality (Version 05.2). In financial analytics the most widely used approach to determine the required return on equity of an investment is the Capital Asset Pricing Model (CAPM). 8 The CAPM provides a formalized approach for the requirements of option (a). Description of Approach selected for Equity risk premium (ERP) calculation within the CAPM according to the PoA DD; Approach 1, Approach 2 or other approach. Provide substantial reasoning for choice, backed by scientific references. Approach: Name of ERP approach chosen ER = RfR + formula for ERP approach chosen Where: Parameter Value Source ER Risk free Rate Further parameter for approach chosen Table 3: Financial parameters of the calculation of the Benchmark IRR for CPA title The parameters are explained under Approach 1 in the PoA DD. Based on the above data the expected return on equity for CPA title is: ER = Risk free rate + ERP 8 Brealey et al 2007: Fundamentals of Corporate Finance, p.304

7 CDM Executive Board page 7 Sub-step 2c: Calculation and comparison of financial indicators: The calculation of the equity IRR of CPA title is submitted along with the CPA DD. All assumptions of critical parameters have been substantiated with reliable sources. The following table presents the key parameters and their sources: Table 4: Key parameters applied in the calculation of the CPA title CPA Equity IRR Parameter Value Unit Sources Total investment USD Feasibility Study prepared or revised by an independent expert; quotations for major equipment; purchase orders Equity USD Feasibility Study prepared or revised by an independent expert; Installed capacity MW Feasibility Study prepared or revised by an independent expert; quotations for generators Yearly electricity generation kwh/year Feasibility Study prepared or revised by an independent expert Yearly O&M costs USD/year Feasibility Study prepared or revised by an independent expert Plant load factor Feasibility Study prepared or revised by an independent expert % Feasibility Study prepared or revised by an independent expert; national legislation VAT (including fiscal incentives) Loan payback rates USD/year Feasibility Study prepared or revised by an independent expert; bank financing agreement Loan interest rate % Feasibility Study prepared or revised by an independent expert; bank financing agreement Electricity feed in tariff (including subsidies and inflation rate adjustments) Project lifetime (investment term) USD/kWh years Feasibility Study prepared or revised by an independent expert; electricity sector legislation; PPA Feasibility Study prepared or revised by an independent expert The result of the calculation of the equity IRR compared to the benchmark and the CPA implemented with CER revenues are: Equity IRR of CPA Equity IRR of CPA with CER revenues Benchmark As a result of the benchmark analysis it is clearly shown that the proposed CPA CPA title is not financially attractive without. CER revenues help the CPA to reach an acceptable return on equity.

8 CDM Executive Board page 8 Sub-step 2d: Sensitivity analysis: The essential parameters for the profitability of a hydroelectric project are the total investment and the electricity price. Other parameters such as O&M costs have only a minor impact, as their contribution to the overall costs is small. Therefore, a sensitivity analysis is conducted on total investment and electricity price. The assessed variation is +/-10%. Table 5: Sensitivity Analysis on total investment and electricity price for CPA title Equity IRRs Sensitivity on kwh price -10% -5% 0% 5% 10% without CERs with CERs Sensitivity on Investment -10% -5% 0% 5% 10% without CERs with CERs For CPA title even the most favorable variations, e.g. +10% electricity price and -10% investment, will not help the project to reach the required benchmark. It is hence further substantiated that the project activity CPA title is not financially attractive without CDM. Step 3: Barrier Analysis The following steps are performed, along the guidelines of the Tool for the demonstration and assessment of additionality (Version 05.2): Sub-step 3a: Identify barriers that would prevent the implementation of the proposed CDM project activity: List of identified realistic and credible barriers, backed by transparent and documented evidence., Sub-step 3b: Show that the identified barriers would not prevent the implementation of at least one of the alternatives (except the proposed project activity): Demonstrate that the identified do not prevent the implementation of at least one of the alternatives. Step 4: Common Practice CPA title is eligible to reach CDM status as the prevalent conditions in Honduras are favourable to thermal generation investors; this is demonstrated by the fact that percentage of small Honduran CDM hydro projects of the hydro projects below 15MW built in the country in the latest 3 years have reached or intend to reach CDM registration. The projects and their respective CDM status are presented in Table 6 below. Table 6. Activities similar to the proposed project activity. Source CDM Pipeline date List of small Honduran hydro projects of the last 3 years

9 CDM Executive Board page 9 B.4. Description of the sources and gases included in the project boundary and proof that the small-scale CPA is located within the geographical boundary of the registered PoA. The GHG emission sources included in or excluded from the project boundary are as follows: Baseline Project Activity Source Gas Included? Justification/Explanation Honduras Grid CO 2 Included According to AMS.I.D version 13, only CO 2 electricity (ENEE) emissions from electricity generation should be accounted for. CH 4 Excluded According to AMS.I.D CPA title Hydropower station electricity production Table 7. GHG Sources included within project boundary N 2 O Excluded According to AMS.I.D CO 2 Excluded According to AMS.I.D CH 4 Excluded According to AMS.I.D N 2 O Excluded According to AMS.I.D CPA title is located within the boundaries of the republic of Honduras as specified in A

10 CDM Executive Board page 10 B.5. Emission reductions: B.5.1. Data and parameters that are available at validation: Data / Parameter: Data unit: Description: Source of data used: Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment: ID.1 / P y MW Power capacity installed The value reflects the expected capacity to be installed at the power plant according to the plant design parameters. Data / Parameter: ID.2 / NCV i,y Data unit: GJ/thousand US gallon Description: The net calorific value for fossil fuel i Source of data used: 2006 IPCC Guidelines for National Greenhouse Gas Inventories, volume 2 chapter 1 (table 1.2) 9 Value applied: GJ/thousand US gal for diesel, GJ/thousand US gal for bunker Justification of the The IPCC Guidelines are the most reliable source for these values. The lower choice of data or IPCC value of the uncertainty at a 95% confidence interval has been chosen, description of accordance with the methodological tool Tool to calculate the emission measurement methods factor for an electricity system (Version 01.1). and procedures actually applied : Any comment: IPCC: Guidelines for National Greenhouse Gas Inventories, volume 2 chapter 1 (table 1.2), (last accessed 21/04/09)

11 CDM Executive Board page 11 Data / Parameter: ID.3 / EF CO2,i,y Data unit: tco 2 /GJ Description: Emission factor for fuel i in year y Source of data used: 2006 IPCC Guidelines for National Greenhouse Gas Inventories, volume 2, chapter 1 table 1.4 Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment: tco 2 /GJ for bunker and tco 2 /GJ for diesel. The IPCC Guidelines are the most reliable source for these values. The lower IPCC value of the uncertainty at a 95% confidence interval has been chosen, in accordance with the methodological tool Tool to calculate the emission factor for an electricity system (Version 01.1). Data / Parameter: ID.4 / EF CO2,m,i,y Data unit: tco 2 /GJ. Description: Average emission factor for fuel i used in a power unit m in year y Source of data used: 2006 IPCC Guidelines for National Greenhouse Gas Inventories, volume 2, chapter 1 table 1.4 Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment: tco 2 /GJ for bunker and tco 2 /GJ for diesel. The IPCC Guidelines are the most reliable source for these values. The lower IPCC value of the uncertainty at a 95% confidence interval has been chosen, in accordance with the methodological tool Tool to calculate the emission factor for an electricity system (Version 01.1). Data / Parameter: ID.5 / EF grid,cm Data unit: tco 2 /MWh Description: CO 2 emission factor for electricity displaced in the grid Source of data used: Own calculations based on data published on the website of the Honduran national electricity company ENEE ( and provided by the national electricity company ENEE. Value applied: Justification of the The parameter is calculated as the combined margin (CM) according to the choice of data or Tool to calculate the emission factor for an electricity system (version description of 01.1). For operating margin (OM) and built margin (BM) the respective exante approaches are chosen. For the OM data from the years 2005, 2006 and measurement methods and procedures actually 2007 as included in Annex 3 is used. For the BM data from the year 2007 is applied : used. Any comment:

12 CDM Executive Board page 12 Data / Parameter: ID.6 / EF grid,om simple, y Data unit: t CO 2 /MWh Description: Operating Margin Source of data used: Own calculations based on data published on the website of the Honduran national electricity company ENEE ( and provided by the national electricity company ENEE. Value applied: Justification of the The parameter is calculated as the operating margin (OM) according to the choice of data or Tool to calculate the emission factor for an electricity system (version description of 01.1). Data from the years 2005, 2006 and 2007 as included in Annex 3 is measurement methods used. and procedures actually applied : Any comment: Data / Parameter: ID.7 / EF grid,bm,y Data unit: t CO 2 /MWh Description: Build Margin Source of data used: Own calculations based on data published on the website of the Honduran national electricity company ENEE ( and provided by ENEE officials. Value applied: Justification of the The parameter is calculated as the build margin (BM) according to the Tool choice of data or to calculate the emission factor for an electricity system (version 01.1). Data description of from the year 2007 as included in Annex 3 is used. measurement methods and procedures actually applied : Any comment: Data / Parameter: ID.8 / FC i,m,y Data unit: Thousand US gallons Description: Fuel consumption of each power unit Source of data used: National electricity company ENEE. Value applied: See Annex 3 Justification of the Statistics provided by ENEE officials are used. choice of data or description of measurement methods and procedures actually applied : Any comment:

13 CDM Executive Board page 13 Data / Parameter: ID.9 / m,y Data unit: % Description: Net energy conversion efficiency of power unit Source of data used: Tool to calculate the emission factor for an electricity system (version 01.1) Value applied: Default values Justification of the For the plants Ampac, Elcatex, Green Valley, Laeisz, Ceiba, Emce I and choice of data or Santa Fe no valid fuel consumption values could be obtained from ENEE. description of The most appropriate default values from Annex 1 of the "Tool to calculate measurement methods the emission factor for an electricity system (version 01.1)" have been used and procedures actually instead to obtain the emission factor of these plants. applied : Any comment: Data / Parameter: ID.10 / EGm,y Data unit: MWh Description: Yearly electricity generation of power unit Source of data used: Data published on the website of the Honduran national electricity company ENEE ( Value applied: See Annex 3 Justification of the The statistics published on the website of the Honduran national electricity choice of data or company, ENEE, is the most legitimate and up to date source. description of measurement methods and procedures actually applied : Any comment: Data / Parameter: ID.11 / EF El,m,y Data unit: t CO 2 /MWh Description: Power unit emission factor Source of data used: Own calculations based on data published on the website of the Honduran national electricity company ENEE ( and data provided by ENEE officials. Value applied: See Annex 3 Justification of the Equations (3) and (4) from the "Tool to calculate the emission factor for an choice of data or electricity system (version 01.1)" have been used to calculate the values. description of measurement methods and procedures actually applied : Any comment:

14 CDM Executive Board page 14 B.5.2. Ex-ante calculation of emission reductions: The total emission reductions of the CPA are calculated on the basis of the equations and parameters presented and explained in section E.6.1 of the PoA DD and B.5.1 of this document. Baseline information for the combined margin emission factor is presented in Annex 3 of this document. Taking into account starting date crediting period as a starting date of a 7 year crediting period, emission reductions calculations for year first year of crediting period and last year of crediting period refer to the fraction of the respective year that is covered by the crediting period. Baseline emissions Grid connected renewable electricity generation 1. Calculation of the baseline emissions from electricity generation The Electricity delivered (EG y ) by CPA title is calculated based on the following factors 10 : Gross head Design flow Maximum tailwater effect Number of turbines Turbine peak efficiency Turbine efficiency at design flow Maximum hydraulic losses Generator efficiency Transformer losses Parasitic electricity losses Annual downtime losses Hydro plant capacity Plant load factor 11 Thereby EG y = electricity delivered by project MWh/year Table 8. Electricity delivered by the project Year Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 EG y MWh/year 10 The electricity delivered by the project and the factors applied in its calculation is presented in the project s feasibility study, prepared by project owner and independent experts; revised and approved by an independent auditor. 11 Validated as per EB 48 annex 11 Guidelines for the reporting and validation of plant load factors.

15 CDM Executive Board page 15 EFgrid CM, y 629 tco2 / GWh Equation:, = 12 BE y, power = EG y EFgrid, CM, y Results: Table 9. Baseline emissions from electricity generation Year Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 BE y, power [tco 2 /year] Emission reductions 2. Calculation of emission reduction from electricity generation Input data: BE, = Table 3. Baseline emissions from electricity generation y power PE, = 0 y power Leakage, = 0 y power Equation: ER y, power = BE y, power PE y, power Leakage y, Result: Table 10. Emission reduction from electricity generation Year Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 ER y, power [tco 2 /year] power 12 The calculation of the combined margin emission factor is based on and presented in the PoA DD section E.6. using baseline data presented in Annex 3 of this document.

16 CDM Executive Board page 16 B.5.3. Summary of the ex-ante estimation of emission reductions: Table 11. Ex-ante estimation of emission reductions Year Estimation of project activity emissions PEy (tco 2 ) Estimation of baseline emissions BEy (tco 2 ) Estimation of leakage LEy (tco 2 ) Y1 0 0 Y2 0 0 Y3 0 0 Y4 0 0 Y5 0 0 Y6 0 0 Y7 0 0 Y8 0 0 Total estimated emissions and emission reductions (tco 2 ) 0 0 Estimation of overall emission reductions ERy (tco 2 ) B.6. Application of the monitoring methodology and description of the monitoring plan: B.6.1. Description of the monitoring plan: The monitoring Plan of CPA title is consistent with methodology AMS-I.D. Renewable energy projects (version 13). Description of the monitoring plan is presented below. 1. Monitoring Plan Objective and Organisation The project entity CPA entity name will monitor the electricity delivered to the Honduras national electricity grid by the respective project. For the monitoring, a meter owned by CPA entity name, installed at the point of connection with the grid will be used. The data will be archived electronically and be stored for 2 years after the end of the crediting period of the CPA. CPA entity name personnel will be trained adequately for this task. The technical, operational and maintenance trainings provided for the personnel will be detailed in the first monitoring report. To ensure that the data is reliable and transparent, the project entity will also establish Quality Assurance and Quality Control (QA&QC) measures to effectively control and manage data reading, recording, auditing as well as archiving data and all relevant documents.

17 CDM Executive Board page Monitoring Data Data to be monitored is the electricity delivered to the Honduras national grid by the project. The monitoring of electricity delivered will be monitored using a project-owned meter at the point of connection with the grid. The entity responsible for monitoring, CPA entity name, will provide Hidromasca with meter readings for electricity delivered and calibration certificates of the project-owned meter as required by the manufacturer s and/or grid operator s instructions. Hidromasca will subsequently provide the verifying DOE with this information. Monitoring procedures have been elaborated in further documentation provided to the DOE including responsibilities, Management, Quality Assurance, Means of Verification of data, data transferring and data trails. The procedures ensure that no double accounting occurs and that the status of verification can be determined anytime for the CPA. 3. Quality Assurance and Quality Control QA&QC procedures for recording, maintaining and archiving data shall be implemented as part of this CDM project activity. These have been elaborated in further documentation provided to the DOE. The installation location of the meters will be at the point of connection to the grid.. CPA entity name will implement QA&QC measures to calibrate and guarantee the accuracy of metering and safety of the project operation. The metering devices will be calibrated and inspected properly and periodically, according to manufactures specifications, to ensure their accuracy. 4. Verification of monitoring results The responsibilities for verification of the projects will be further defined when the project is at a more developed stage. CPA entity name will carry the responsibility for providing the DOE with all required necessary information, before, during and in the event of queries, after the verification. The parameter to be monitored is: Data / Parameter: Data unit: Description: Source of data to be used: Value of data Description of measurement methods and procedures to be applied: ID.12/ EG y MWh/year Electricity delivered by the project activity in year y Measured by an electricity meter Electricity delivered by the project activity The electricity delivered will be measured continuously by one meter owned by project owner. The meter is installed at the point of connection with the grid as agreed with the grid operator. A high level of accuracy of the measurements will be achieved due to the use of high-precision equipment calibrated and tested according to recognized standards, and agreed with the grid operator. In case the grid operator will install an own electricity meter, this meter will be used for cross check of the measured values. If values differ the value from the meter with higher precision shall be used. NOTE: The electricity meter owned by the grid operator is managed and

18 CDM Executive Board page 18 maintained under the sole responsibility of the grid operator and according to their internal standards. Therefore, it is NOT part of the project, nor within the project boundary. QA/QC procedures to be applied: Any comment: For a typical CPA the circuit for internal electricity supply of the power plant will connect between the transformer at the plant and the point of connection to the grid. Therefore, electricity consumed internally by the plant will not be measured by the electricity meter at the point of connection to the grid and does not need to be subtracted from the measured electricity delivered to the grid. In case that the circuit for internal electricity supply connects behind the point of connection to the grid, and therefore behind the electricity meter, a separate meter for internal consumption will be installed. Only in this case electricity consumed internally shall be deducted from the electricity delivered to the grid. QA: The device will be recalibrated and tested according to the instructions (schedules, procedures) for QA of the technology provider and/or grid operator. QC: There will be strict compliance to maintenance schedule recommended by the technology provider and/or grid operator. C.1. Please indicate the level at which environmental analysis as per requirements of the CDM modalities and procedures is undertaken. Justify the choice of level at which the environmental analysis is undertaken: The environmental analysis is undertaken at the CPA level. The environmental impact of small run-ofriver hydro plants depends entirely on the particular location, size and how the plant is embedded in its environment. Therefore the CPA level is the adequate choice for the environmental analysis. C.2. Documentation on the analysis of the environmental impacts, including transboundary impacts: Resume of the environmental diagnostic, related issues and possible impacts

19 CDM Executive Board page 19 C.3. Please state whether an environmental impact assessment is required for a typical CPA, included in the programme of activities (PoA), in accordance with the host Party laws/regulations: According to Honduras Environmental regulations, each hydro project depending on its size has to get either an environmental registration (0.5-1MW), an environmental authorization (1-3MW) or an environmental license (>3MW) 13. To get either of the above authorizations it is necessary that the project developer presents to the environmental authority an environmental diagnostic. The environmental diagnostic is not a full environmental impact assessment. A full environmental impact assessment may be required by the national environmental authority (SERNA) in exceptional cases, subject to the outcome of the environmental diagnostic. In these cases the applicable environmental authorization is not obtained unless the EIA is duly performed and accepted by SERNA. Therefore, in any case the proper environmental authorization proves full acceptance of the project by SERNA. SECTION D. Stakeholders comments >> D.1. Please indicate the level at which local stakeholder comments are invited. Justify the choice: The stakeholder comments are invited at the CPA level. The impact on the surrounding communities of small run-off-river hydro plants depends entirely on the particular location, size and how the plant is embedded in its environment. Therefore, the CPA level is the adequate choice for inviting stakeholder comments. D.2. Brief description how comments by local stakeholders have been invited and compiled: Invitation procedure List of invitees Table 12. Invitation list for stakeholder consultation. Description of meeting and how comments were compiled D.3. Summary of the comments received: Summary of comments received D.4. Report on how due account was taken of any comments received: Description of assessment of comments and follow up 13 Based on Reviewed on October 20th 2008

20 CDM Executive Board page 20 Annex 1 CONTACT INFORMATION ON ENTITY/INDIVIDUAL RESPONSIBLE FOR THE SMALL- SCALE CPA Organization: Street/P.O.Box: Building: City: State/Region: Postfix/ZIP: Country: Telephone: FAX: URL: Represented by: Title: Salutation: Last Name: Middle Name: First Name: Department: Mobile: Direct FAX: Direct tel: Personal The project does not receive public funding. Annex 2 INFORMATION REGARDING PUBLIC FUNDING

21 CDM Executive Board page 21 Annex 3 BASELINE INFORMATION Electricity Generation in Honduras (GWh) Generation Technology Aguan* Biomass Ampac Diesel engine MV Aysa Biomass Azunosa Biomass Babilonia Hydro Cahsa Biomass Cañaveral Hydro Cececapa Hydro Ceiba Diesel engine MV Cemcol Diesel engine MV Chumbagua Biomass Cortecito Diesel engine MV Cuyamapa Diesel engine MV Cuyamel Diesel engine MV Eda Biomass Eecopalsa Biogas El Cajón Hydro 1, , , El Coyolar Hydro El Níspero Hydro Elcatex Diesel engine MV Elcosa Diesel engine MV Emce I Diesel engine MV Emce II Diesel engine MV Enersa Diesel engine MV 1, , , Green Valley Diesel engine MV La Esperanza Hydro La Gloria Hydro La Grecia Biomass La Nieve Hydro La Puerta Gas turbines La Puerta - MEX Gas turbines Laeisz Diesel engine MV Laeisz NACO Diesel engine MV Lean* Biomass Lufussa I Gas turbines Lufussa II Diesel engine MV

22 CDM Executive Board page 22 Lufussa III Diesel engine MV 1, , , Nacaome Hydro Nacional de Ing. Diesel engine MV Rio Blanco Hydro Río Lindo Hydro Santa Fe Diesel engine MV Santa María del Real Hydro Tres Valles Biomass Yojoa Hydro Zacapa Hydro International Nicaragua Costa Rica Panama El Salvador Guatemala Otros Source: (Accessed 25/10/2009)

23 SMALL-SCALE CDM PROGRAMME ACTIVITY DESIGN DOCUMENT FORM (CDM-SSC-CPA-DD) - Version 01 CDM Executive Board page 23 Fuel consumption (1000 US gal) and Emission factor (tco 2 /MWh) of thermal power units in Honduras Plants Technology Fuel Emission Factor Santa Fe Diesel engine MV Diesel Alshtom* Diesel engine MV Bunker Diesel Sulzer* Diesel engine MV Bunker Diesel La Ceiba * Diesel engine MV Bunker 4, , , Diesel La Puerta Gas turbines Diesel La Puerta - MEX Gas turbines Diesel Elcosa Diesel engine MV Bunker 13, , , Emce I Diesel engine MV Diesel Not available - - Emce II Diesel engine MV Bunker 10, , , Diesel Lufussa I Gas turbines Diesel 1, Lufussa II Diesel engine MV Bunker 11, , , Diesel Lufussa III Diesel engine MV Bunker 99, , , Diesel , Enersa Diesel engine MV Bunker 68, , , Diesel Laeisz Diesel engine MV Diesel Laeisz NACO Diesel engine MV Diesel 2, , Cemcol Diesel engine MV Diesel 1, Nacional de Ing. CTE Diesel engine MV Diesel Nacional de Ing. Not M.F. Diesel engine MV Diesel Nacional de Ing. L.P. Diesel engine MV Diesel Ampac Diesel engine MV Diesel Elcatex Diesel engine MV Bunker available Not available Not Not available available Not Not Not available available available Not Not Not available available available Green Valley Diesel engine MV Source fuel consumption: ENEE officials Source emission factor: own calculations based on data published on ENEE website and data provided by ENEE officials

24 SMALL-SCALE CDM PROGRAMME ACTIVITY DESIGN DOCUMENT FORM (CDM-SSC-CPA-DD) - Version 01 CDM Executive Board page 24 Source: Data provided by ENEE officials Start of operations of Honduran power plants Power plant Start year of operation Celsur 2007 Chumbagua 2007 Cortecito 2007 Cuyamapa 2007 Cuyamel 2007 Green Valley 2007 La Gloria 2007 San Carlos 2007 Eecopalsa 2006 La Esperanza*** 2006 Cahsa 2005 Cececapa 2005 Yojoa 2005 Zacapa 2005 rehabilitation Enersa** 2004/2005 Azunosa 2004 Babilonia 2004 Elcatex 2004 Lufussa III 2004 Rio Blanco 2004 Tres Valles 2004 Laeisz NACO 2004 Aguan 2002 La Grecia 2002 La Nieve 2002 Lean 2002 Nacaome 2002 El Coyolar 2000 Nacional de Ing Emce II 1999 Lufussa II 1999 Cemcol 1998 Laeisz 1998 Aysa 1998 Lufussa I 1995 Elcosa 1994 La Puerta - MEX* 1994 Santa Fe 1994 Ampac 1993 Santa María del Real 1986 El Cajón 1985 Sulzer 1984 El Níspero 1982 Alsthom 1980 La Ceiba 1974 Río Lindo 1971 La Puerta 1970 Cañaveral 1964

25 SMALL-SCALE CDM PROGRAMME ACTIVITY DESIGN DOCUMENT FORM (CDM-SSC-CPA-DD) - Version 01 CDM Executive Board page 25 Annex 4 MONITORING INFORMATION