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

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1 CDM Executive Board page 1 CLEAN DEVELOPMENT MECHANISM PROGRAM ACTIVITY DESIGN DOCUMENT FORM (CDM-CPA-DD) Version 01 CONTENTS A. General description of CDM programme activity (CPA) B. Eligibility of CPA 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 the submission of CPAs that apply a large scale methodology using provisions of the proposed PoA. (ii) The coordinating/managing entity shall prepare a CDM Programme Activity Design Document (CDM-CPA-DD) 1,2 that is specified to the proposed PoA by using the provisions stated in the PoA DD. At the time of requesting registration the PoA DD must be accompanied by a CDM-CPA-DD form that has been specified for the proposed PoA, as well as by one completed CDM-CPA-DD (using a real case). After the first CPA, every CPA that is added over time to the PoA must submit a completed CDM-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 CDM programme activity (CPA) A.1. Title of the CPA: >> CPA Reference Number: Cape Town CPA 01 Title: Landfill Gas Extraction and Utilisation at Coastal Park Landfill Version: 01 Date: 23/03/2012 A.2. Description of the CPA: >> The landfill gas (LFG) capture and utilisation project at Coastal Park Landfill in Cape Town, South Africa is to be implemented as part of the CDM PoA City of Cape Town Landfill Gas Extraction and. The Coastal Park landfill has been operational since 1985 and is expected to serve a major role in the future disposal of the City s waste because of its strategic geographical location and relatively long lifespan, anticipated to be until at least The site currently receives approximately 450,000 tonnes of waste per year comprising general municipal waste, garden refuse and builders rubble which is compacted in place. Annex 3 summarises the background waste data which have been provided by the City of Cape Town from their internal records, for use in the ex-ante estimation of emission reductions. The landfill gas which is currently produced by the site is neither collected nor flared/utilised, but vents to the atmosphere. The CPA will therefore reduce greenhouse gas emissions by capturing a proportion of the landfill gas produced, and then combusting it to generate electricity. Any gas which is collected in excess of the installed engine capacity will be combusted by flaring. The site is owned and operated by the City of Cape Town and therefore the rights to extract and utilise the landfill gas are already established. The sustainable development benefits of the scheme have been described at POA level. A.3. Entity/individual responsible for CPA: >> The Coastal Park Landfill is owned and operated by the City of Cape Town, which is therefore the entity responsible for implementation of CPA 01 - Landfill Gas Extraction and Utilisation at Coastal Park Landfill under the POA, and is also the owner of the CPA. Name of Party involved (*) (host) indicates a Host Party Private and/or public entity(ies) project participants (*) (as applicable) Kindly indicate if the Party involved wishes to be considered as project participant (Yes/No) The Republic of South Africa (host) City of Cape Town No (*) In accordance with the CDM modalities and procedures, at the time of making the

3 CDM Executive Board page 3 CDM-PDD public at the stage of validation, a Party involved may or may not have provided its approval. At the time of requesting registration, the approval by the Party(ies) involved is required. Full contact information for the project participants is provided in Annex 1. A.4. Technical description of the CPA: The CPA consists of controlled capture of landfill gas using the following items of equipment: A network of vertical and horizontal landfill gas collection wells installed within the waste; Landfill gas collection pipework connected to the wells, which will draw the collected gas back to a single location (gas compound); Blowers to apply suction to the pipework, allowing the landfill gas to be extracted; Condensate management systems to remove excess liquid from the gas collection pipework; and An enclosed compound area which will provide the focal point for gas collection and also house associated monitoring instrumentation and recording systems as required to monitor the CPA. Once the landfill gas has been captured, it will subsequently be combusted on-site to produce electricity which will be exported to the local grid supply network. The additional items of equipment to be provided will comprise: Landfill gas engines (e.g. Jenbacher JS320 or similar) sufficient to optimise utilisation of LFG for electricity generation. Ex-ante calculations suggest that this will equate to an installed capacity of 2MW; and Electricity transformers which will be required to transform the power and deliver it to the grid. The CPA site will also be provided with an enclosed landfill gas flaring system which will be used to combust any gas which cannot otherwise be used to generate electricity. The flaring system will include the following items of equipment: Enclosed flare to combustion the collected LFG in a controlled manner; and Equipment necessary to monitor the LFG composition (methane content, LFG flow rate and flare combustion temperature). Specific details of the equipment to be used on site will be determined during the design phase, which will be carried out by suitably qualified and experienced technical specialists yet to be commissioned by the City of Cape Town. The general layout of the installation for the capture and utilisation of landfill gas is presented in Figure 1 below.

4 CDM Executive Board page 4 Figure 1: General Layout of the Installation (Electricity Generation) The total annual emission reductions from the landfill gas capture and generation of electricity are estimated to be 103,013 tco 2 e/year over the 21-year period. A.4.1. Identification of the CPA: >> The CPA is identified under the City of Cape Town Landfill Gas Extraction and as CPA 01 - Landfill Gas Extraction and Utilisation at Coastal Park Landfill. A Host Party: >> The Host Party of the CPA is the Republic of South Africa. A Geographic reference of other means of identification allowing the unique identification of the CPA (maximum one page): >> The Coastal Park landfill is located at: Coastal Park Landfill Baden Powell Drive Strandfontein/Muizenberg

5 CDM PROGRAMME ACTIVITY DESIGN DOCUMENT FORM (CDM-CPA-DD) - Version 01 CDM Executive Board page 5 The landfill site is located west of Muizenberg in the South Peninsula Municipal Area. The site occupies approximately 62 ha. The Coastal Park landfill serves the broader southern suburbs of the CMA and has GPS co-ordinates of 34º S 18º E. The location of the site is presented in Figure 2 below. Figure 2: Location of Coastal Park Landfill The entity/individual responsible for the CPA is: City of Cape Town PO Box 298 Cape Town Republic of South Africa A.4.2. Duration of the CPA: A Starting date of the CPA: >> The starting date of the CPA is 01/01/2013 this being the anticipated date for the award of contract to a project implementer. A Expected operational lifetime of the CPA: >> The expected operational lifetime of the CPA is 21 years.

6 CDM Executive Board page 6 A.4.3. Choice of the crediting period and related information: Renewable crediting period. A Starting date of the crediting period: >> The starting date of the crediting period is 01/07/2014. A Length of the crediting period, first crediting period if the choice is renewable CP: >> The length of the first crediting period is 7 years. >> A.4.4. Estimated amount of emission reductions over the chosen crediting period: Year Total annual estimation of emission reductions in tonnes of CO 2 e 2014* 26, , , , , , , * 90,232 Total estimated reduction (tonnes of CO 2 e) 897,524 Total number of crediting years 7 Annual average over the crediting period of estimated reduction (tonnes of CO 2 e) 128,218 *as the start of the crediting period is anticipated to be 01/10/2014, data for 3 months for 2014 and 9 months for 2021 have been applied. A.4.5. Public funding of the CPA: >> CPA01 does not receive public funding. A.4.6. Confirmation that CPA is neither registered as an individual CDM project activity nor is part of another Registered PoA: >>

7 CDM Executive Board page 7 As the owner and operator of the Coastal Park landfill, and CME for the PoA, the City of Cape Town has confirmed that CPA 01 is neither registered as an individual CDM project activity nor is part of another registered PoA.

8 CDM Executive Board page 8 SECTION B. Eligibility of CPA and Estimation of emissions reductions B.1. Title and reference of the Registered PoA to which CPA is added: >> City of Cape Town Landfill Gas Extraction and B.2. Justification of the why the CPA is eligible to be included in the Registered PoA : >> CPA 01 - Landfill Gas Extraction and Utilisation at Coastal Park Landfill is eligible for inclusion in the City of Cape Town Landfill Gas Extraction and as it fulfils the following criteria as described in the CDM-PoA-DD. Table 1: Eligibility Criteria from the City of Cape Town Landfill Gas Extraction and CDM-PoA-DD Eligibility Criterion Yes/No Comment/Source 1 The geographical boundary of the CPA is consistent with the geographical boundary of the POA. 2 The CPA is uniquely identified (e.g. by signage and site referencing) to avoid double counting 3 The CPA meets the applicability criteria set by ACM00001 Version and all associated tools which are relevant to the CPA 4 The CME has confirmed through documentary evidence that the start date of the CPA is not prior to the commencement of validation of the PoA 5 The CME confirms that funding from Annex I parties, if any, does not result in diversion of official development assistance 6 The CPA has in place the required environmental authorisations 7 Local stakeholder consultations have been undertaken prior to enrolment 8 The CPA will not receive funding from Annex I parties that results in a diversion of official development assistance 9 The baseline scenario comprises the atmospheric release of LFG, or partial capture and destruction of LFG to comply with regulations or contractual requirements, or to address safety and odour concerns. Yes Yes Yes Yes Yes Yes Yes Yes See Section A CPA 01 - Landfill Gas Extraction and Utilisation at Coastal Park Landfill. See Section A.1. See Section E.2 of PoA-DD. No formal contractual arrangements have yet been confirmed with a project implementer See Section A.4.5 Environmental Permit reference 16/2/7/G203/D29/Z4/P377 See Section D See Section A.4.5. Yes See Section B.3

9 CDM Executive Board page 9 10 The project activity comprises the capture of LFG and use in generating electricity or generating heat 11 The project activity would not otherwise be developed without the financial benefits provided by registration as a CDM project. Yes See Section A.4 Yes Barrier analysis and investment analysis has been carried out for the CPA to provide supporting evidence of additionality. See Section B.3. B.3. Assessment and demonstration of additionality of the CPA, as per eligibility criteria listed in the Registered PoA: >> ACM0001 Flaring or use of landfill gas Version refers to the Combined tool to identify the baseline scenario and assess additionality to assess and demonstrate the additionality of the CPA. The tool (Version ) comprises the following steps: Step 0: Demonstration whether the proposed project activity is the First-of-its-kind Step 1: Identification of alternative scenarios; Step 2: Barrier analysis; Step 3: Investment analysis (if applicable); and Step 4: Common practice analysis. These steps are presented below. Step 0: Demonstration whether the proposed project activity is the First-of-its-kind This step is optional and is not applied as the proposed project activity is not considered to be the First-ofits-kind. Step 1: Identification of alternative scenarios This step serves to identify all alternative scenarios to the proposed CDM project activity which can be the baseline scenario via the following sub-steps: Sub-step 1a: Define alternative scenarios to the proposed CDM project activity Identification of the alternatives has been completed considering the scenarios derived from the methodology ACM0001 Version and described in Section E.4 of the POA-DD. Outcome of Step 1a The potential alternative baseline scenarios which have been identified for CPA 01 are presented below: Table 2: Alternative Scenarios to the CPA Scenario Baseline LFG Electricity Description of Scenario

10 CDM Executive Board page 10 1 LFG2 (S3) E3 Atmospheric release of the landfill gas. Electricity generated in existing grid connected power plants. (the baseline scenario). 2 LFG1 (S1) E1 The project activity undertaken without being registered under CDM. Electricity generation from LFG, undertaken without being registered as a CDM project activity. 3 LFG1 (S1) - The project activity limited to flaring only (no electricity generation from LFG) and undertaken without being registered under CDM. 4 LFG5 (S5) E3 Development of an Energy from Waste (EfW) facility on site to treat the solid waste by incineration. Electricity generated in new grid connected power plant. Sub-step 1b: Consistency with mandatory applicable laws and regulations The following South African waste legislation governs the management of waste within the country 3. The South African Constitution (Act 108 of 1996) Hazardous Substances Act (Act 5 of 1973) Health Act (Act 63 of 1977) Environment Conservation Act (Act 73 of 1989) Occupational Health and Safety Act (Act 85 of 1993) National Water Act (Act 36 of 1998) The National Environmental Management Act (Act 107 of 1998) Municipal Structures Act (Act 117 of 1998) Municipal Systems Act (Act 32 of 2000) Mineral and Petroleum Resources Development Act (Act 28 of 2002) Air Quality Act (Act 39 of 2004) National Environmental Management: Waste Act, 2008 (Act 59 of 2008) Outcome of Step 1b All scenarios described above are compliant with this suite of legislation and therefore the list of potential alternatives remains unchanged as a result of Sub-step 1b. Step 2: Barrier analysis This step serves to identify barriers and to assess which alternative scenarios are prevented by these barriers. The latest approved version of the Guidelines for objective demonstration and assessment of barriers has been taken into account when applying this step. Sub-step 2a: Identify barriers that would prevent the implementation of alternative scenarios 3 South African Waste Information Centre (2012): Legislation. Available at (website accessed on 12/01/12)

11 CDM Executive Board page 11 Investment barriers As a public authority, and in the absence of any regulatory requirement to do so, the City of Cape Town would not otherwise invest significant sums of money in the development of such LFG management schemes. However, insufficient financial returns is not, in isolation, considered to represent a justifiable investment barrier for this CPA. Technological barriers There are considered to be no technological barriers in South Africa which would prevent the implementation of potential alternative scenarios. Although the City of Cape Town does not have direct experience of the implementation and operation of this type of project, such services can now be readily procured within the country. Lack of prevailing practice No similar projects are being developed in South Africa without the support of CDM. The common practice for waste disposal is landfilling and there are no current regulations which require the capture and flaring or use of landfill gas. South African landfills which have gas extraction and utilisation infrastructure installed have been developed as CDM projects (See Step 4 Common Practice Analysis below). This therefore represents a barrier to the implementation of Scenarios 2 and 3. Likewise, as common practice is landfilling, there are no similarly sized Energy from Waste facilities treating municipal waste in South Africa and therefore Scenario 4 would be considered a first of its kind which is therefore deemed prevented by the prevailing practice barrier. Other barriers No other barriers have been identified which are applicable to this CPA. Outcome of Step 2a Based on the analysis described above, the barriers which may prevent implementation of one or more of the alternative scenarios comprise: Prevailing practice barrier, as demonstrated by the absence of similar projects in the Host Country without the support of CDM. Sub-step 2b: Eliminate alternative scenarios which are prevented by the identified barriers The analysis described above demonstrates that the following scenarios are prevented by at least one of the barriers listed in Sub-step 2a: Scenario 2 (prevailing practice barrier); Scenario 3 (prevailing practice barrier); and Scenario 4 (prevailing practice barrier). Outcome of Step 2b

12 CDM Executive Board page 12 The alternative scenarios to the project activity that are not prevented by any barrier are: Scenario 1 - Atmospheric release of the landfill gas. Electricity generated in existing or new grid connected power plants. Outcome of Step 2 There is only one alternative scenario that is not prevented by any barrier, and this alternative scenario (Scenario 1) is not the proposed project activity undertaken without being registered as a CDM project activity. Therefore, Scenario 1 is identified as the baseline scenario. Registration of the CDM project activity will alleviate the barriers that prevent the proposed project activity from occurring in the absence of the CDM, as demonstrated by the presence of similar projects which do have the support of CDM in South Africa. Step 3: Investment analysis Barrier analysis as described in Step 2 has demonstrated that the baseline scenario is the only remaining alternative and therefore investment analysis is not required. However an investment analysis has been undertaken to assess additionality. The objective of Step 3 is to compare the economic or financial attractiveness of the alternative scenarios remaining after Step 2 by conducting an investment analysis. The analysis should include all alternative scenarios remaining after Step 2, including the baseline scenario where the project participants do not undertake an investment. The latest version of the Methodological Combined tool to identify the baseline scenario and demonstrate additionality (Version ) as required in Approved consolidated methodology ACM0001 Flaring or use of landfill gas (V ) is now followed together with the Guidelines on the assessment of investment analysis (Version 05). This approach is used to assess whether the proposed project activity is the most economically or financially attractive or economically or financially feasible with the revenue from CERs. The following sub steps will be used: Sub-step 3a: Determine appropriate analysis method Sub-step 3b: Option III. Apply benchmark analysis Sub-step 3c: Calculation and comparison of financial indicators Sub-step 3d: Sensitivity analysis. Sub-step 3a: Determine appropriate analysis method The methodology states that if the CDM project activity and the alternatives identified in Step 1 generate no financial or economic benefits other than CDM related income, then apply the simple cost analysis (Option I). Otherwise, use the investment comparison analysis (Option II) or the benchmark analysis (Option III). Since the CDM project activity does have financial benefits, through the eventual sale of electricity, the Option III benchmark analysis will be used.

13 CDM Executive Board page 13 Sub-step 3b: Option III. Apply benchmark analysis This step requires that the financial/economic indicator most suitable for the project type and decision context is identified. The Internal Rate of Return (IRR) is chosen as the most appropriate indicator as this is a standard financial indicator and allows a benchmark comparison with a widely accepted benchmark, that being a government bond. As referenced in paragraph 12 of the Guidelines on the assessment of investment analysis (Version 05; EB 62 annex 5) the applied benchmark shall be appropriate to the type of IRR calculated. and Local commercial lending rates or weighted average costs of capital (WACC) are appropriate benchmarks for a project IRR. The prime interest rate is seen as the local commercial lending rate in South Africa. The average rate over the past 5 years equals 12.6% 4. The methodology notes that discount factors and benchmarks shall be derived from, amongst others, government bond rates, increased by a suitable risk premium to reflect private investment and/or the project type, as substantiated by an independent (financial) expert or documented by official publicly available financial data. As the project is a public sector investment project the use of government bond rates is seen as appropriate. The 10 year yield on South African government bonds for January 2012 was used as the benchmark rate. This was sourced from the South African Reserve Bank statistical tables published for the period during which the financial evaluation was undertaken and was therefore the applicable benchmark at the time the investment decision was undertaken. (SARB, 2012, Statistical Tables Capital Market, page S-29, table: Capital market interest rates and yields). The observed benchmark yield is 8.4% 5. Sub-step 3c: Calculation and comparison of financial indicators This step requires the suitable financial indicator for the proposed CDM project activity to be calculated and the investment analysis to be provided in a transparent manner. As noted, the project IRR is used as an appropriate and commonly used indicator to analyse a project investment. Internal rate of return (IRR) financial models were generated for the two scenarios identified: Scenario 1: Atmospheric release of the landfill gas. No project power generation and the continued use of existing and/or new grid-connected power plants for all municipal power supply. This is effectively the continuation of the status quo. Scenario 2: Capture of landfill gas and the combustion in engines and a flare without being registered as a CDM project activity. The City of Cape Town wishes to recover energy from the gas and not just combust it in a flare. A flare only scenario is therefore not considered. There is not a legal requirement in South Africa to extract and combust the gas and it is not required in the Authorisation for the Coastal Park landfill site %20-%20Capital%20market.pdf

14 CDM Executive Board page 14 A baseline analysis is not included as the City of Cape Town does not extract and manage the gas at present. Landfill gas monitoring which is currently carried out will be undertaken under for the CDM project. The Net Present Value (NPV) is also presented for each scenario to assist in a transparent presentation of the analysis. The financial models were also considered for Scenario 2 but with CDM revenue to provide an analysis of whether the projects become financially viable with CDM revenue included. The models were developed for the 21 year project period from project commissioning to the end of The discount rate for the NPV calculations was taken as a real discount rate of 3.7% (equivalent to a nominal rate of 12.6% since the prevailing inflation rate at the time of developing the model was 8.9%). The use of a low discount rate is conservative because a higher discount rate would be in favour of the status quo. The key financial parameters used in the model are tabulated below. A more detailed explanation of the technical, cost and financial assumptions used in the model are provided in an associated document which accompanies the IRR model financial spreadsheets. Financial Parameter Interest rate R/ R/US$ Description Value Reference Annual borrowing rate 12.6% Exchange rate 7.5 % Exchange rate 10% 5 year average South African Reserve Bank South African Reserve Bank The results of the models for the IRR investment analysis without CDM income are: IRR -0.1% NPV 11,392,227 Scenario 1 entails no new expenditure or new revenue and hence is financially neutral with a 0% IRR. Scenario 2 has an NPV of R11.4 million with no CERs. This negative NPV is due to the high capital costs and the high engine running costs. The results of the models for the IRR investment analysis with CDM income are: IRR 10.4% NPV 19,866,833

15 CDM Executive Board page 15 When CDM revenues are added to Scenario 2 the NPV becomes R17.1 million and the IRR becomes 9%. The inclusion of CERs therefore significantly improves the project net present value and IRR. The project proponent, the City of Cape Town, recognise that South Africa is not a Least Developed Country (LDC) and therefore may not be able to sell CERs under the European Union Emissions Trading Scheme (EU- ETS). The current market value for CERs is therefore taken with significant sensitivity assumptions (ICE ECX CER December 2012) 6. The methodology requires that a clear comparison of the financial indicator for the proposed CDM activity and the financial benchmark is used. If the CDM project activity has a less favourable indicator (e.g. lower IRR) than the benchmark, then the CDM project activity cannot be considered as financially attractive. From the above analysis it can be readily seen that project scenario, Scenario 2, has a lower IRR (less than 0%) than the benchmark government bond rate of 8.4%. Sub-step 3d: Sensitivity analysis The methodology next requires a sensitivity analysis that shows whether the conclusion regarding the financial/economic attractiveness is robust to reasonable variations in the critical assumptions. Therefore the project scenario is further evaluated under a range of sensitivity assumptions as follows: Discount Rate O&M Costs (variation) Capex Costs (variation) REFIT price CER price (variation) 1.7% -20% -20% -50% 2.7% -10% -10% SAR - -25% 3.7% 0% 0% SAR % 4.7% 10% 10% 50% 5.7% 20% 20% 100% The NPV for the above sensitivity assumptions are as follows: The impact of the Discount Rate: Discount rate 1.7% 2.7% 3.7% 4.7% 5.7% NPV (excluding CER and REFIT) -6,400,696-9,145,525-11,392,227-13,235,135-14,750,197 NPV including CER (excluding REFIT) 30,902,897 24,938,889 19,866,833 15,535,285 11,820,426 NPV including CER and REFIT 237,529, ,852, ,028, ,445, ,597,127 The discount rate shows that the project is not financially attractive without CER income. It becomes attractive with REFIT. 6

16 CDM Executive Board page 16 The impact of the O&M costs: NPV (-20% O&M Costs -24,806 IRR (-20% O&M Costs) -5.2% NPV (-10% O&M Costs -18,099 IRR (-10% O&M Costs) -2.5% NPV (+/- 0% O&M Cost -11,392 IRR (+/- 0% O&M Costs -0.1% NPV (+10% O&M Costs -4,685 IRR (+10% O&M Costs) 2.2% NPV (+20% O&M Costs 2,021 IRR (+20% O&M Costs) 4.3% The discount rate shows that the project remains financially unattractive for a +/- 20% variation is O&M costs The impact of the Capex costs: NPV (-20% Capex Costs) 4,398,044 IRR (-20% Capex Costs) 5.4% NPV (-10% Capex Costs) -3,497,092 IRR (-10% Capex Costs) 2.5% NPV (+/- 0% Capex Costs) 11,392,227 IRR (+/- 0% Capex Costs) -0.1% NPV (+10% Capex Costs) 19,287,363 IRR (+10% Capex Costs) -2.3% NPV (+20% Capex Costs) 27,182,498 IRR (+20% Capex Costs) -4.3% The discount rate shows that the project remains financially unattractive for a +/- 20% variation is capital costs The impact of the REFIT price is included in the discount rate tables above. IRR 45.8% NPV 186,028,568 The impacts of the CER costs are given below. A 100% increase is considered to reflect previous CER selling prices NPV (-50% CER price variation) 2.9m IRR (-50% CER price variation) 4.7% NPV(-25% CER price variation) 10.0m IRR (-25% CER price variation) 7.0% NPV (0% CER price variation) 17.1m

17 CDM Executive Board page 17 IRR (0% CER price variation) 9.3% NPV (50% CER price variation) 31.3m IRR (50% CER price variation) 13.7% NPV (100% CER price variation) 45.6m IRR (100% CER price variation) 18.0% The methodology states that the project proponent must present in the CDM-PDD submitted for validation a clear comparison of the financial indicator for the proposed CDM activity and the financial benchmark. If the CDM project activity has a less favourable indicator (e.g. lower IRR) than the benchmark, then the CDM project activity cannot be considered as financially attractive. As demonstrated above this comparison has been done and the CDM project activity cannot be considered as financially attractive when compared against the return from the benchmark South African government bond. It is therefore clear that the continuation of the current practice, Scenario 1, is the economically most attractive course of action if the project could not benefit from the CDM. The project activity therefore passes Step 3 of the additionality test. Step 4: Common practice analysis As explained above, the prevailing common practice in South Africa is to deposit municipal waste in dumps or landfills without the controlled extraction and use of landfill gas. Gas may be vented to atmosphere to reduce its concentration below hazardous levels, but landfill gas capture is not commonly installed. Other landfill gas capture projects in South Africa are operated or being developed as CDM projects, specifically 7 : CDM0243: Durban Landfill-gas-to-electricity project Mariannhill and La Mercy Landfills (1MW installed capacity) CDM0947: Durban Landfill-Gas Bisasar Road (6.5MW installed capacity) CDM1382: EnviroServ Chloorkop Landfill Gas Recovery Project (flaring only) CDM2588: Ekurhuleni Landfill Gas Recovery Project South Africa (currently flaring only, potential for 1MW at two landfill sites) CDM3633: Alton Landfill Gas to Energy Project (potential for up to 0.5MW) Step 4a: The proposed project activity applies measure(s) that are listed in the definitions section of the tool The proposed project activity incorporates methane destruction and therefore Step 4a applies. Sub-step 4a(1): Calculate the applicable output range as +/-50% of the design output or capacity of the proposed project activity. Using a proposed generation capacity of 2MW, this results in an applicable output range of 1-3MW. 7 Source: CDM pipeline January 2012

18 CDM Executive Board page 18 Sub-step 4a(2): Identify all plants that deliver the same output or capacity within the applicable output range in the applicable geographical area. Using the applicable output range of 1-3MW identified above, there are no such plants being developed in South Africa which are not included in the CDM pipeline, therefore N all = 0. Sub-step 4a(3) As no similar plants are being developed within South Africa outside of the CDM process, N diff = 0. Sub-step 4a(4) As both N all and N diff are zero, and therefore factor F is also zero, the project is not regarded as common practice. Outcome of Step 4 Similar activities (i.e. the capture and use of landfill gas without the benefit of CDM) cannot be observed in the host country. The proposed project activity is not regarded as common practice and therefore the proposed project activity is additional. Conclusion The proposed CPA exceeds the requirements of prevailing legislation in South Africa and, in the absence of CDM, is not the most financially attractive option for the project developer (City of Cape Town) and therefore the proposed project activity is additional. B.4. Description of the sources and gases included in the project boundary and proof that the CPA is located within the geographical boundary of the registered PoA. >> Based on the information provided within methodology ACM0001 Version , the following sources of emissions and respective greenhouse gases are identified for the CPA. Table 3: Summary of greenhouse gases and sources included in and excluded from the project boundary Baseline Source Gas Included Justification Emissions from decomposition of waste at the SWDS site Emissions from electricity generation CH 4 Yes The major source of emissions in the baseline N 2 O No N 2 O emissions are small compared to CH 4 emissions from SWDS. This is conservative. CO 2 No CO 2 emissions from decomposition of organic waste are not accounted since the CO 2 is also released under the project activity. CO 2 Yes Major emission source if power generation is included in the project activity.

19 CDM Executive Board page 19 Project Activity Emissions from fossil fuel consumption for purposes other than electricity generation or transportation due to the project activity Emissions from electricity consumption due to the project activity CH 4 No Excluded for simplification. This is conservative. N 2 O No Excluded for simplification. This is conservative. CO 2 Yes May be an important emission source. CH 4 No Excluded for simplification. This emission source is assumed to be very small. N 2 O No Excluded for simplification. This emission source is assumed to be very small. CO 2 Yes May be an important emission source. CH 4 No Excluded for simplification. This emission source is assumed to be very small. N 2 O No Excluded for simplification. This emission source is assumed to be very small. CPA 01 - Landfill Gas Capture and Utilisation at Coastal Park Landfill is located within the geographical boundary of the POA, i.e. the municipal boundary for the City of Cape Town. The project boundary of the CPA is presented schematically in Figure 3 below. Figure 3: Schematic Representation of the Project Boundary B.5. Emission reductions:

20 CDM Executive Board page 20 B.5.1. Data and parameters that are available at validation: Data / Parameter: Data unit: Source of data used: Value applied: Justification of the choice of data or description of and procedures actually applied : Any comment: ID01 - Regulatory requirements relating to landfill gas n/a Regulatory requirements for landfill gas management in RSA Publicly available information in the host country (e.g. Zero for the first crediting period The most recent legislation applicable to landfill management in South Africa is the draft Minimum Requirements for Waste Disposal by Landfill published in Active capture, flaring and/or destruction of LFG is not stated as a mandatory requirement, the minimum requirements provide safety guidelines relating to controlling accumulations of LFG by use of passive venting. The Coastal Park Landfill is regulated by a Permit, which does not require the capture, flaring or use of LFG 8. Information will be reviewed and recorded annually, but will only be used to amend (if required) parameter F CH4,BL,R,y at the renewal of the crediting period. If changes have been made to the regulatory requirements during the first crediting period, emission reductions for the next crediting period will be calculated on the basis of the updated requirements. Data / Parameter: ID02 GWP CH4 Data unit: tco 2 e/tch 4 Global warming potential of methane Source of data used: IPCC Value applied: 21 Justification of the Value of 21 used for the first commitment period subject to revision according choice of data or to any future COP/MOP decisions description of and procedures actually applied : Any comment: Data / Parameter: ID03 OX top_layer Data unit: Dimensionless Fraction of methane that would be oxidised in the top layer of the SWDS in the baseline Source of data used: Consistent with how oxidation is accounted for in the methodological tool Emissions from solid waste disposal sites (Version ) Value applied: 0.1 Justification of the Applicable to Step A choice of data or 8 Department of Water Affairs and Forestry Environmental Permit Reference No. 16/2/7/G203/D29/Z4/P377 dated 16/05/2000.

21 CDM Executive Board page 21 description of and procedures actually applied : Any comment: Data / Parameter: ID04 EF EL,j,y Data unit: tco 2 /MWh Emission Factor for Electricity Generation Source of data used: Tool to calculate baseline, project and/or leakage emissions from electricity consumption (Version 01) Value applied: 1.3 Justification of the Applicable to Option A2 choice of data or description of and procedures actually applied : Any comment: Applicable to Scenario A (Electricity consumption from the grid) for project emission calculations Taken from the Tool to calculate the emission factor for an electricity system (Version ) Data / Parameter: ID05 - NCV i,y Data unit: GJ/mass or volume unit Net calorific value (energy content) of fossil fuel type i in year y Source of data used: Value applied: Justification of the Eskom publishes detailed data on an annual basis on all aspects of power choice of data or generation and supply in South Africa and is therefore considered to represent a description of reliable source of such information. and procedures actually applied : Any comment: See PoA-DD Section E.6.2. Data / Parameter: Data unit: Source of data used: Value applied: Justification of the choice of data or description of and procedures actually applied : ID06 - FC i,m,y Mass or volume unit Amount of fossil fuel type i consumed by power plant m in year y See PoA-DD accompanying spreadsheet _RSA_GEF_Calcs Eskom publishes detailed data on an annual basis on all aspects of power generation and supply in South Africa and is therefore considered to represent a reliable source of such information.

22 CDM Executive Board page 22 Any comment: See PoA-DD Section E.6.2. Data / Parameter: ID07 - EF CO2,i,y Data unit: tco 2 /GJ CO 2 emission factor of fossil fuel type i used in power units m in year y Source of data used: IPPC Value applied: Justification of the IPPC default value for other bituminous coal choice of data or description of and procedures actually applied : Any comment: See PoA-DD Section E.6.2. Data / Parameter: Data unit: Source of data used: Value applied: Justification of the choice of data or description of and procedures actually applied : Any comment: ID08 - EG m,y GWh Net electricity generated by power unit m in year y See PoA-DD accompanying spreadsheet _RSA_GEF_Calcs Eskom publishes detailed data on an annual basis on all aspects of power generation and supply in South Africa and is therefore considered to represent a reliable source of such information. See PoA-DD Section E.6.2. Data / Parameter: ID09 - η m,y Data unit: % Average net energy conversion efficiency of power unit m in year y Source of data used: Annex I of the Tool to calculate the emission factor for an electricity system (Version ) Value applied: 37 (before and in 2000) 39 (after 2000) Justification of the Value for Subcritical coal power plants as per Annex I of the Tool to calculate choice of data or the emission factor for an electricity system (Version ) description of and procedures actually applied : Any comment: See PoA-DD Section E.6.2. Taken from the Methodological Tool Emissions from solid waste disposal sites Version Data / Parameter: ID10 f default Data unit: -

23 CDM Executive Board page 23 Default factor for the model correction factor to account for model uncertainties Source of data used: Methodological Tool Emissions From Solid Waste Disposal Sites (Version ) Value applied: 0.75 Justification of the Applicable to Application A (dry conditions) according to Table 3: Default choice of data or values for the model correction factor description of and procedures actually applied : Any comment: Data / Parameter: ID11 OX Data unit: - Oxidation factor (reflecting the amount of methane from SWDS that is oxidised in the soil or other material covering the waste) Source of data used: Methodological Tool Emissions From Solid Waste Disposal Sites (Version ) Value applied: 0.1 Justification of the In accordance with the default value stated in Methodological Tool Emissions choice of data or From Solid Waste Disposal Sites (Version ) description of and procedures actually applied : Any comment: Data / Parameter: ID12 F Data unit: - Fraction of methane in the SWDS gas (volume fraction) Source of data used: IPCC 2006 Guidelines for National Greenhouse Gas Inventories Value applied: 0.5 Justification of the In accordance with the default value stated in Methodological Tool Emissions choice of data or From Solid Waste Disposal Sites (Version ) description of and procedures actually applied : Any comment: Default values are used in the ex-ante estimation of emission reductions. Calculations of ex-post emission reductions will use actual values recorded during monitoring of the CPA. Data / Parameter: ID13 DOC f,default Data unit: Weight fraction Fraction of degradable organic carbon (DOC) that can decompose Source of data used: IPCC 2006 Guidelines for National Greenhouse Gas Inventories Value applied: 0.5

24 CDM Executive Board page 24 Justification of the choice of data or description of and procedures actually applied : Any comment: In accordance with the default value stated in Methodological Tool Emissions From Solid Waste Disposal Sites (Version ) for Application A Data / Parameter: ID14 - MCF default Data unit: - Methane correction factor Source of data used: IPCC 2006 Guidelines for National Greenhouse Gas Inventories Value applied: 1.0 Justification of the The default value applied is applicable to the Coastal Park landfill site because choice of data or it satisfies the criteria applicable to an anaerobic solid waste disposal site by description of having controlled placement of waste and use of cover material, mechanical compacting or levelling of the waste. and procedures actually applied : Any comment: Data / Parameter: ID15 - DOC j Data unit: - Fraction of degradable organic content in the waste type j (weight fraction) Source of data used: IPCC 2006 Guidelines for National Greenhouse Gas Inventories (adapted from Volume 5, Tables 2.4 and 2.5) Value applied: Default values for DOC j taken from Table 4 of the Methodological Tool Emissions from solid waste disposal sites Waste Type j DOC j (% wet waste) Wood and wood products 43 Pulp, paper and cardboard (other than sludge) 40 Food, food waste, beverages and tobacco (other 15 than sludge) Textiles 24 Garden, yard and park waste 20 Glass, plastic, metal, other inert waste 0 Justification of the choice of data or description of and procedures actually applied : Any comment: Waste type is MSW therefore default values can be used.

25 CDM Executive Board page 25 Data / Parameter: ID16 - k j Data unit: - Decay rate for the waste type j Source of data used: IPCC 2006 Guidelines for National Greenhouse Gas Inventories (adapted from Volume 5, Table 3.3) Value applied: Default values for DOC j taken from Table 5 of the Methodological Tool Emissions from solid waste disposal sites Slowly degradi g Moderately degrading Rapidly degrading Waste type j Boreal and Temperate (MAT 20ºC) Dry (MAP/PET <1) Pulp, paper, cardboard (other than 0.04 sludge), textiles Wood, wood products and straw 0.02 Other (non-food) organic putrescible 0.05 garden and park waste Food, food waste, sewage sludge, 0.06 beverages and tobacco Justification of the choice of data or description of and procedures actually applied : The mean annual temperature for Cape Town is 16.5ºC The mean annual precipitation for Cape Town is 515mm The mean annual evapotranspiration for Cape Town is 1898mm Data Source: Temperature and precipitation data retrieved from Evapotranspiration data retrieved from Cape Town Weather Office Any comment: Data / Parameter: ID17 - f y Data unit: - Fraction of methane captured at the SWDS and flared, combusted or used in another manner that prevents the emissions of methane to the atmosphere in year y Source of data used: Information provided by the site operator and confirmed by site visits Value applied: 0 Justification of the Value is applied to baseline emissions calculations as there is no capture of choice of data or landfill gas at the Coastal Park landfill site. description of and procedures actually applied : Any comment: Value applied once for the crediting period (Application A).

26 CDM Executive Board page 26 Data / Parameter: Data unit: Source of data used: Value applied: ID18 - W x Tonnes Amount of waste disposed in the SWDS in year x Measured by City of Cape Town For Coastal Park Landfill site, the following values have been applied Year Tonnes Year Tonnes , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,428 Justification of the choice of data or description of and procedures actually applied : Any comment: Data taken from historical records of landfill operation, aggregated into annual figures and provided by City of Cape Town. Figures are determined once ex-ante for the purpose of estimating emission reductions (Application A). Taken from the Methodological Tool to determine project emissions from flaring gases containing methane Data / Parameter: ID19 P n Data unit: Pa Atmospheric pressure at normal conditions Source of data used: Tool to determine project emissions from flaring gases containing methane Value applied: 101,325 Justification of the To be used in ex-post calculations of project emissions choice of data or description of

27 CDM Executive Board page 27 and procedures actually applied : Any comment: - Data / Parameter: ID20 R u Data unit: Pa.m3/kmol.K Universal ideal gas constant Source of data used: Tool to determine project emissions from flaring gases containing methane Value applied: 8, Justification of the To be used in ex-post calculations of project emissions choice of data or description of and procedures actually applied : Any comment: - Data / Parameter: ID21 T n Data unit: K Temperature at normal conditions Source of data used: Tool to determine project emissions from flaring gases containing methane Value applied: Justification of the To be used in ex-post calculations of project emissions choice of data or description of and procedures actually applied : Any comment: - Data / Parameter: ID22 MM i Data unit: Kg/kmol Molecular mass of residual gas component i Source of data used: Tool to determine project emissions from flaring gases containing methane Value applied: For i = methane (MM CH4 ) = For i = nitrogen (MM N2 ) = Justification of the To be used in ex-post calculations of project emissions choice of data or description of and procedures actually applied : Any comment: Tool allows a simplified approach of measuring the volumetric fraction of methane and considering the difference to 100% as being nitrogen (N 2 ). Data / Parameter: Data unit: ID23 AM j kg/kmol

28 CDM Executive Board page 28 Atomic mass of element j Source of data used: Tool to determine project emissions from flaring gases containing methane Value applied: For j = Carbon (AM c ) = For j = Hydrogen (AM h ) = 1.01 For j = Nitrogen (AM n ) = Justification of the To be used in ex-post calculations of project emissions choice of data or description of and procedures actually applied : Any comment: - Data / Parameter: ID24 NA j,i Data unit: - Number of atoms of element j in component i Source of data used: Tool to determine project emissions from flaring gases containing methane Value applied: For i = methane Where j = Carbon (NA c,ch4 ) = 1 Where j = Hydrogen (NA h,ch4 ) = 4 Justification of the choice of data or description of and procedures actually applied : Any comment: - For i = Nitrogen Where j = nitrogen (NA n,n ) = 2 To be used in ex-post calculations of project emissions Data / Parameter: ID25 - ρ CH4,n Data unit: tch 4 /m 3 CH 4 Density of methane gas at normal conditions Source of data used: Methodological Tool to determine project emissions from flaring gases containing methane Value applied: Justification of the Value defined by the approved Methodological Tool to determine project choice of data or emissions from flaring gases containing methane description of and procedures actually applied : Any comment: The parameter ρ CH4,n refers to density of methane that will be used to calculate ex-post project emissions from flaring

29 CDM Executive Board page 29 Data / Parameter: ID26 MF O2 Data unit: Dimensionless O 2 volumetric fraction of air Source of data used: Methodological Tool to determine project emissions from flaring gases containing methane Value applied: 0.21 Justification of the Value defined by the approved Methodological Tool to determine project choice of data or emissions from flaring gases containing methane description of and procedures actually applied : Any comment: Data / Parameter: ID27 - MV n Data unit: m 3 /Kmol Volume of one mole of any ideal gas at normal temperature and pressure Source of data used: Methodological Tool to determine project emissions from flaring gases containing methane Value applied: Justification of the Value defined by the approved Methodological Tool to determine project choice of data or emissions from flaring gases containing methane description of and procedures actually applied : Any comment: Data / Parameter: ID28 η flare,h Data unit: % Flare efficiency in the hour h Source of data used: Methodological Tool to determine project emissions from flaring gases containing methane Value applied: 90 Justification of the Approved default value applied. choice of data or description of and procedures actually applied : Any comment: - B.5.2. Ex-ante calculation of emission reductions: >> Baseline Emissions Baseline emissions are determined according to equation 1 of ACM0001 Version as follows:

30 CDM Executive Board page 30 BE y = BE CH4,y + BE EC,y + BE HG,y + BE NG,y Where: BE y = Baseline emissions in year y (t CO 2 e/yr) BE CH4,y = Baseline emissions of methane from the SWDS in year y (t CO 2 e/yr) BE EC,y = Baseline emissions associated with electricity generation in year y (t CO 2 /yr) BE HG,y = Baseline emissions associated with heat generation in year y (t CO 2 /yr) BE NG,y = Baseline emissions associated with natural gas use in year y (t CO 2 /yr) For the purposes of this CPA, there will be no heat generation or substitution of natural gas in the project activity and therefore BE HG,y and BE NG,y = 0. The results of the calculation of baseline emissions are presented in Table 4 below. Year Table 4: Baseline Emissions Baseline emissions in year y (t CO 2 e/yr) 2014* 26, , , , , , , * 90,232 *as the start of the crediting period is anticipated to be 01/10/2014, data for 3 months for 2014 and 9 months for 2021 have been applied. Step A: Baseline emissions of methane from the SWDS (BE CH4,y ) Baseline emissions of methane from the SWDS are determined as follows, based on the amount of methane that is captured under the project activity and the amount that would be captured and destroyed in the baseline. In addition, the effect of methane oxidation that is present in the baseline and absent in the project is taken into account: 9 9 OX top-layer is the fraction of the methane in the LFG that would oxidize in the top layer of the SWDS in the absence of the project activity. Under the project activity, this effect is reduced as a part of the LFG is captured and does not pass through the top layer of the SWDS. This oxidation effect is also accounted for in the methodological tool Emissions from solid waste disposal sites. In addition to this effect, the installation of a LFG capture system under the project activity may result in the suction of additional air into the SWDS. In some cases, such as with a high suction pressure, the air may decrease the amount of methane that is generated under the project activity. However, in most circumstances where the LFG is captured and used this effect was considered to be very small, as the operators of the SWDS have in most cases an incentive to main a high methane concentration in the LFG. For this reason, this effect is neglected as a conservative assumption.

31 CDM Executive Board page 31 BE CH4,y = ( 1- OX top_layer ) ( F CH4,PJ,y F CH4,BL,y ) GWP CH4 Where: BE CH4,y = Baseline emissions of LFG from the SWDS in year y (t CO 2 e/yr) OX top_layer = Fraction of methane in the LFG that would be oxidized in the top layer of the SWDS in the baseline (dimensionless) F CH4,PJ,y = Amount of methane in the LFG which is flared and/or used in the project activity in year y (t CH 4 /yr) F CH4,BL,y = Amount of methane in the LFG that would be flared in the baseline in year y (t CH 4 /yr) GWP CH4 = Global warming potential of CH 4 (t CO 2 e/t CH 4 ) For the purposes of these calculations, and in accordance with ACM0001 Version , the following values are applied: OX top_layer = 0.1 (default value for baseline calculations stipulated in ACM0001 Version ); F CH4,BL,y = 0 (there is no capture, flaring or use of landfill gas in the baseline scenario and therefore Case 1 of ACM0001 Version applies); and GWP CH4 = 21(default value stipulated in ACM0001 Version ). F CH4,PJ,y is calculated ex-ante as follows: F CH4, PJ, y = η BE PJ CH4,SWDS,y /GWP CH4 Where: F CH4,PJ,y = Amount of methane in the LFG which is flared and/or used in the project activity in year y (t CH 4 /yr) BE CH4,SWDS,y = Amount of methane in the LFG that is generated from the SWDS in the baseline scenario in year y (t CO 2 e/yr) η PJ = Efficiency of the LFG capture system that will be installed in the project activity GWP CH4 = Global warming potential of CH 4 (t CO 2 e/t CH 4 ) For the purposes of these calculations, and in accordance with ACM0001 Version , the following values are applied: η PJ = 0.5 (default assumption of 50% collection efficiency); and GWP CH4 = 21(default value stipulated in ACM0001 Version ) BE CH4,SWDS,y has been determined using the methodological tool Emissions from solid waste disposal sites. The following guidance has been taken into account when applying the tool: f y in the tool has been assigned a value of 0 because the amount of LFG that would have been captured and destroyed is already accounted for in equation 2 of methodology ACM0001 Version ;

32 CDM Executive Board page 32 In the tool, x begins with the year that the SWDS started receiving wastes (e.g. the first year of SWDS operation); and Sampling to determine the fractions of different waste types is not necessary because the waste composition has been obtained from previous studies. Full details of the calculations are presented in the accompanying calculation spreadsheet ACM0001 Calculation Summary Coastal Park. The results of the calculation of F CH4,PJ,y are presented in Table 5 below. Table 5: Amount of methane in the LFG which is flared and/or used in the project activity Year Amount of Methane which is Flared and/or Used in year y (t CO 2 e/yr) 2014* 1, , , , , , , * 4,206 *as the start of the crediting period is anticipated to be 01/10/2014, data for 3 months for 2014 and 9 months for 2021 have been applied. Step B: Baseline emissions associated with electricity generation (BE EC,y ) The baseline emissions associated with electricity generation in year y (BE EC,y ) have been calculated using the Tool to calculate baseline, project and/or leakage emissions from electricity consumption. Where:

33 CDM Executive Board page 33 The source of electricity consumption in the baseline is the South African grid system (Scenario A as defined within the tool). Option A1 allows the calculation of the combined margin emission factor for the applicable electricity system, using the procedures in the latest version of the Tool to calculate the emission factor for an electricity system (EF EL,j/k/l,y = EF grid,cm,y ). This option produces a lower emission factor value (see PoA-DD Section E.6.2) and therefore provides a conservative estimate of baseline emissions and emission reductions. The technical transmission and distribution losses for providing electricity from the grid system are published by Eskom, and therefore the published data have been applied 10. The following values have therefore been applied to the ex-ante calculations: EF EL,k,y = (calculated value for the first crediting period) TDL k,y = 5.68% (data published by Eskom) k = the South African national grid system EC BL,k,y has been calculated by multiplying the electricity generation potential of the project 2MW by 8,000 hours as a conservative assumption (equating to approximately 91% engine operating time in any given year). The calculation also conservatively considers transformer losses for supply of electricity to the grid of 6% (typical value for LFG utilisation projects). The results of the ex-ante calculation of BE EC,y are presented in Table 6 below. Table 6: Baseline emissions associated with electricity generation Year 2014* 3, , , , , , , * 11,002 Baseline Emissions from Electricity Consumption in year y (t CO 2 e/yr) *as the start of the crediting period is anticipated to be 01/10/2014, data for 3 months for 2014 and 9 months for 2021 have been applied. Step C: Baseline emissions associated with heat generation (BE HG,y ) Not applied as the CPA will not include substitution of the use of natural gas. BE HG,y is assigned a value of zero. 10 Eskom 2011 Annual Report, page 186.

34 CDM Executive Board page 34 Step D: Baseline emissions associated with natural gas use (BE NG,y ) Not applied as the CPA will not include substitution of the use of natural gas. BE NG,y is assigned a value of zero. Project Emissions Project emissions are calculated as follows: PE = PE + PE y Where: EC,y FC,y PE y = Project emissions in year y (t CO 2 /yr) PE EC,y = Emissions from consumption of electricity due to the project activity in year y (t CO 2 /yr) PE FC,y = Emissions from consumption of fossil fuels due to the project activity, for purpose other than electricity generation, in year y (t CO 2 /yr) For the purposes of this CPA, there will be no consumption of fossil fuels as all power will be supplied by the grid and therefore PE FC,,y = 0. The results of the calculation of ex-ante project emissions are presented in Table 7 below. Year Table 7: Project Emissions Project emissions in year y (t CO 2 e/yr) 2014* * 271 *as the start of the crediting period is anticipated to be 01/10/2014, data for 3 months for 2014 and 9 months for 2021 have been applied. PE EC,y has been calculated according to the Tool to calculate baseline, project or leakage emissions from electricity consumption using the following equation Where:

35 CDM Executive Board page 35 The source of electricity consumption in the project is the South African grid system (Scenario A as defined within the tool). Option A2, which allows the use of conservative default values for the grid emission factor, is applicable since Scenario A applies to both the baseline and the project electricity consumption sources; and the electricity consumption of the project sources is greater than the electricity consumption of the baseline sources, as required by the tool. Use of the conservative default value for grid emission factor produces a higher level of project emissions and hence a conservative calculation of emission reductions. The technical transmission and distribution losses for providing electricity from the grid system are published by Eskom, and therefore the published data have been applied 11. The following values have therefore been applied to the ex-ante calculations: EF EL,j,y = 1.3 (default value) TDL j,y = 5.68% (data published by Eskom) j = the project activity EC PJ,j,y has been calculated based on the anticipated electricity demand for the project, which is detailed in the accompanying spreadsheet ACM0001 Calculation Summary Coastal Park. Emission Reductions Emission reductions are calculated as follows: ER y = BE y PE y Where: ER y = Emission reductions in year y (t CO 2 e/yr) BE y = Baseline emissions in year y (t CO 2 e/yr) PE y = Project emissions in year y (t CO 2 /yr) An ex ante estimate of emissions reductions is presented in Section B.5.3 below. B.5.3. Summary of the ex-ante estimation of emission reductions: >> Estimation of Estimation of Estimation of Year project activity baseline leakage Estimation of overall emission 11 Eskom 2011 Annual Report, page 186.

36 CDM Executive Board page 36 emissions (tonnes of CO 2 e) emissions (tonnes of CO 2 e) (tonnes of CO 2 e) reductions (tonnes of CO 2 e) 2014* 90 28, , , , , , , , , , , , , , * , ,232 Total (tonnes of CO 2 e) 2, , ,844 *as the start of the crediting period is anticipated to be 01/10/2014, data for 3 months for 2014 and 9 months for 2021 have been applied. B.6. Application of the monitoring methodology and description of the monitoring plan: B.6.1. Description of the monitoring plan: >> The Monitoring Plan is consistent with the requirements of methodology ACM0001 Version and applicable methodological tools and monitoring procedures. A general discussion of the monitoring measures to be applied to the PoA is presented in Annex 4 of the POA-DD. The Monitoring Plan for this CPA has been developed to ensure that the relevant data are monitored, captured and stored in accordance with the requirements of the methodology and tools, and to facilitate the verification process once the project activity has been registered. The parameters to be monitored and methods to be employed are tabulated below. Data Collection and Record Keeping Monitoring data will be collected and stored using an appropriately configured supervisory control and data acquisition (SCADA) system, to ensure that the appropriate parameters (as identified below) are recorded at the required frequencies throughout the crediting period. Data will be compiled in an electronic format designed to facilitate auditing. All data required for verification and issuance will be backed-up and retained for at least two years after the end of the crediting period or the last issuance of CERs for the CPA, whichever occurs later. Quality Control (QC) and Quality Assurance (QA) All data collected on site will be checked internally by the project team to ensure that it is complete and of appropriate quality. A further check of all data collected will be carried out to ensure completeness and provide an analysis of project performance prior to any verification.

37 CDM Executive Board page 37 Maintenance and Calibration of Monitoring Equipment Equipment specific procedures will be developed to ensure that all equipment and instrumentation is maintained and calibrated in accordance with the recommendations of the manufacturers. Calibration records will be maintained for each item of equipment and an instrument list for the CPA will be developed and maintained, summarising the calibration and maintenance history of each item. Monitoring equipment will be identified by serial number and a named individual will be tasked with managing the instrument list to ensure that calibrations are carried out at the required frequency and that calibration certificates are provided (where applicable) and held on file for audit purposes. Where deemed appropriate, specialist maintenance contractors will be retained to ensure that the equipment continues to function at optimum levels throughout the crediting period. Staff Training All staff involved in the management and monitoring of the CPA will receive training appropriate to their specific responsibilities. Training will include use and maintenance of key items of equipment, along with record keeping requirements and lines of communication applicable to the CPA. Training for all staff will emphasise the importance of maintaining complete and accurate data and records for the CDM verification and issuance process. CDM Monitoring Organisation and Management The details of the project team and management structure will be finalised prior to the start of the crediting period. Clear roles and responsibilities will be assigned to all members of staff identified in the project team. The CPA project team will include a dedicated CDM Monitoring Manager who will be responsible for ensuring that the required monitoring activities are completed on a day to day basis. Data and Parameters Monitored Data / Parameter: Data unit: Source of data to be used: Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of and procedures to be applied: ID29 F CH4,BL,R,y tch 4 /yr Amount of methane in the LFG which is flared due to a requirement in year y Information of the host country s regulatory requirements relating to LFG, contractual requirements, or requirements to address safety and odour concerns. 0 Annually checked

38 CDM Executive Board page 38 QA/QC procedures to - be applied: Any comment: - Data / Parameter: ID30 Data unit: Dimensionless Fraction of LFG that is required to be flared due to a requirement in year y Source of data to be Information of the host country s regulatory requirements relating to LFG, used: contractual requirements, or requirements to address safety and odour concerns. Value of data applied 0 for the purpose of calculating expected emission reductions in section B.5 Description of Annually checked and procedures to be applied: QA/QC procedures to - be applied: Any comment: - The following parameters are taken from the Methodological tool Tool to determine the mass flow of a greenhouse gas in a gaseous stream. Data / Parameter: ID31 V i,t,wb (also equivalent to V k,t,wb ) Data unit: m 3 gas i/k / m 3 wet gas Volumetric fraction of greenhouse gas i/k (methane in both cases) in a time interval t on a wet basis Source of data to be Measured by project participants to identify: used: Amount of methane sent to flare Amount of methane used for electricity generation Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of and procedures to be applied: QA/QC procedures to be applied: Any comment: As appropriate to the use of LFG in the CPA n/a only used for ex-post calculations Continuous in-situ analysers to be used, positioned at the LFG delivery pipeline to each item of equipment (flare, engine or boiler/air heater). Calibration will include zero verification with an inert gas (e.g. N 2 ) and at least one reading verification with a standard gas (single calibration gas or mixture calibration gas). All calibration gases will have a certificate provided by the manufacturer and be under their validity period. Option F applied

39 CDM Executive Board page 39 Data / Parameter: Data unit: Source of data to be used: Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of and procedures to be applied: QA/QC procedures to be applied: Any comment: ID32 M t,wb kg/h Mass flow of the gaseous stream (LFG) in time interval t on a wet basis Measured by project participants to identify: Amount of methane sent to flare Amount of methane used for electricity generation As appropriate to the use of LFG in the CPA n/a only used for ex-post calculations Continuous monitoring using instruments with recordable signal (analogical or digital), positioned at the LFG delivery pipeline to each item of equipment (flare, engine or boiler/air heater). Periodic calibration against a primary device provided by an independent accredited laboratory (mandatory). Calibration and frequency of calibration in accordance with the manufacturer s specifications. Option F applied The following parameters are taken from the Methodological Tool to determine project emissions from flaring gases containing methane. Data / Parameter: ID33 fv i,h Data unit: - Volumetric fraction of component i in the residual gas in hour h Source of data to be used: Volumetric fraction of methane (i = CH 4 ) to be measured by project participants using a continuous gas analyser positioned at the LFG delivery pipeline to each Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of and procedures to be applied: QA/QC procedures to be applied: Any comment: flare. n/a as it is only used in ex-post calculations Measured continuously. Values to be averaged hourly or at a shorter time interval. Ensure that the same basis (dry or wet) is considered for this measurement and the measurement of the volumetric flow rate of the residual gas (FV RG,h ) when the residual gas temperature exceeds 60ºC. Analysers will be periodically calibrated according to the manufacturer s recommendation. A zero check and a typical value check will be performed by comparison with a standard certified gas. As a simplified approach, only the methane content of the residual gas will be measured, with the remaining part considered as N 2. Data / Parameter: ID34 FV RG,h

40 CDM Executive Board page 40 Data unit: m 3 /h Volumetric flow rate of the residual gas (LFG) in dry basis at normal conditions in the hour h Source of data to be Measurements by project participants using a flow meter used: Value of data applied n/a as it is only used in ex-post calculations for the purpose of calculating expected emission reductions in section B.5 Description of Measured continuously. Values to be averaged hourly or at a shorter time interval. Ensure that the same basis (dry or wet) is considered for this and procedures to be measurement and the measurement of the volumetric flow rate of the residual gas applied: (fv CH4,h ) when the residual gas temperature exceeds 60ºC. QA/QC procedures to Flow meters are to be periodically calibrated according to the manufacturer s be applied: recommendation. Any comment: Data / Parameter: ID35 - T flare Data unit: ºC Temperature in the exhaust gas of the flare Source of data to be Measurements by the project participants used: Value of data applied n/a as it is only used in ex-post calculations for the purpose of calculating expected emission reductions in section B.5 Description of Measured continuously using a Type N thermocouple. A temperature above 500ºC indicates that a significant amount of gases are still being burnt and that and procedures to be the flare is operating. applied: QA/QC procedures to Thermocouples should be replaced or calibrated every year. be applied: Any comment: An excessively high temperature at the sampling point (above 700ºC) may be an indication that the flare is not being adequately operated or that its capacity is not adequate to the actual flow. Data / Parameter: ID36 - Other flare operation parameters Data unit: - To include all data and parameters that are required to monitor whether the flare operates within the range of operating conditions according to the manufacturer s specification Source of data to be Measurements by project participants used: Value of data applied n/a as it is only used in ex-post calculations for the purpose of

41 CDM Executive Board page 41 calculating expected emission reductions in section B.5 Description of and procedures to be applied: QA/QC procedures to be applied: Any comment: Continuous monitoring Only applicable in case of use of a default value. Details to be confirmed by the chosen technology provider. The following parameters are taken from the Methodological tool Tool to calculate baseline, project and/or leakage emissions from electricity consumption. Data / Parameter: ID37 - TDL k,y Data unit: % Average technical transmission and distribution losses for providing electricity to source j (project) and k (baseline) in year y Source of data to be Recent accurate and reliable data available within the host country (Scenario A used: applies) Value of data applied 5.68% (Eskom 2011 Annual Report, page 186) for the purpose of calculating expected emission reductions in section B.5 Description of Monitored annually. In the absence of data from the relevant year, most recent figures should be used, but not older than 5 years. and procedures to be applied: QA/QC procedures to Eskom generates approximately 95% of the electricity used in South Africa, and be applied: its core business is electricity generation, transmission, trading and distribution. It therefore provides a reliable source of official documentation. Any comment: No leakage effects are accounted for under ACM0001 Version Data / Parameter: Data unit: Source of data to be used: Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of ID38 - EC PJ,j,y MWh/yr Quantity of electricity consumed by the project electricity consumption source j in year y Measurements by project participants Measured continuously by electricity meter

42 CDM Executive Board page 42 and procedures to be applied: QA/QC procedures to be applied: Any comment: Data / Parameter: Data unit: Source of data to be used: Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of and procedures to be applied: QA/QC procedures to be applied: Any comment: Data / Parameter: Data unit: Source of data to be used: Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of and procedures to be applied: QA/QC procedures to be applied: Any comment: Data / Parameter: Electricity meter will be subject to regular maintenance and testing (in accordance with the recommendations of the manufacturer/supplier) to ensure accuracy Used to calculate PE EC,y ID39 - EC BL,k,y MWh/yr Net amount of electricity generated using LFG Measurements by project participants 15,040 Measured continuously by electricity meter Electricity meter will be subject to regular maintenance and testing (in accordance with the recommendations of the manufacturer/supplier) to ensure accuracy Used to calculate BE EC,y ID40 - Operation of the Energy Plant hr Operation of the energy plant Project participants 8,000 Operating hours will be identified for each item of equipment and monitored on an hourly basis. - Monitored to ensure that methane destruction is only claimed for methane used in the electricity plant when it is operational ID41 - EF EL,k,y

43 CDM Executive Board page 43 Data unit: Source of data to be used: Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of and procedures to be applied: QA/QC procedures to be applied: Any comment: tco 2 /MWh Emission Factor for electricity generation for source k in year y Tool to calculate baseline, project and/or leakage emissions from electricity consumption Option A (see PoA-DD Section E.6.2.) To be recalculated at the beginning of each crediting period. - Monitored in electricity generation projects only and only at the start of the second and third crediting periods. Use of the calculated value in baseline emissions is conservative (i.e. lower) compared to use of the default value which is applied in the calculation of project emissions.

44 CDM Executive Board page 44 SECTION C. Environmental analysis >> 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: Please tick if this information is provided at the PoA level. In this case sections C.2. and C.3. need not be completed in this form. C.2. Documentation on the analysis of the environmental impacts, including transboundary impacts: >> Implementation of the project at the Coastal Park Landfill Site is a scheduled activity in terms of the National Environmental Management Waste Act 59 of 2008 (NEMWA) and Regulations (GN R718) and required a waste management licence in terms of section 49 of the NEMWA from the Department of Environmental Affairs (DEA), which included a basic (environmental) assessment in accordance with the National Environmental Management Act 107 of 1998 (NEMA) and the related Environmental Impact Assessment (EIA) Regulations (GN R385), in terms of GN R718, Category A, Clause 13 (The extraction, recovery or flaring of landfill gas) and Clause 18 (The construction of facilities for activities listed in Category A). In the context of the basic assessment report, a collection of baseline information was undertaken of the site and its surroundings in order to establish the sensitivity of the receiving environment to the potential project impacts, and to determine restrictions the environment may have on the project. Information was obtained from existing reports, 1: topographical maps, aerial and satellite photography, and environmental mapping resources for the area (e.g. geological and ecological). These data were verified during site visits (refer to Section 9). Based on the information collected and assessed in the basic assessment process, it was concluded that the proposed landfill gas to electricity project will not result in any significant adverse environmental impacts. The potential impacts associated with the proposed project were assessed and the significance of these potential impacts evaluated with consideration of proposed mitigation measures. The majority of the potential impacts identified were considered to be of low significance. The most significant impacts are summarised as follows: The generation of condensate Condensate (which is generated during the collection of landfill gas) has the potential to collect in receiving surface/ground water bodies; however, no impacts are anticipated provided that the condensate is contained and does not come into contact with any receiving water bodies, and is collected and returned to the landfill (by means that will be considered during the design phase of the project). Airborne emissions from electricity generation equipment

45 CDM Executive Board page 45 The interpretation of the Nitrogen Oxides (NOx) model output in the air quality specialist study indicates the potential for the ambient standard to be exceeded near the source; however, the probability of this impact is expected to be significantly reduced by the effect of the prevailing winds experienced in the area. Noise emissions from electricity generation equipment Elevated noise levels from the internal combustion engines and flares have the potential to impact on the ambient noise environment with subsequent potential environmental and/or health impacts; however, specialist studies show that predicted sound levels are unlikely to impose a significant impact at the nearest receptors. On the basis of the qualitative environmental assessment process, none of the potential impacts associated with the proposed facility have been predicted to exceed the magnitude of low to medium significance. The table below provides an overview of the main potential environmental impacts associated with the project and proposed mitigation measures to address such impacts as assessed in the basic assessment report:

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