VERIFICATION REPORT PA KHOANG HYDROPOWER PROJECT REPORT NO. GHGCC(E) REVISION NO. 03 GHG CERTIFICATION OFFICE

Transcription

1 VERIFICATION REPORT PA KHOANG HYDROPOWER PROJECT REPORT NO. GHGCC(E) REVISION NO. 03 GHG CERTIFICATION OFFICE KOREA ENERGY MANAGEMENT CORPORATION

2 Date of first issue: Project No.: 19/06/2012 GHGCC(E) Approved by: Organisational unit: LEE, Chang-Hoo GHG Certification Office, Korea Energy Management Corporation Client: Client ref.: Bunge Emissions Holdings Sarl Francois Louis Gigante Monitoring Period 25/12/2010 ~ 29/02/2012 Category (Sectoral Scope) Energy Industries (renewable/non-renewable sources) (1) First Monitoring Report (version and date) Version 0.1, 19/03/2012 Final Monitoring Report (version and date) Version 1.5, 21/06/2012 Summary: The Korea Energy Management Corporation (KEMCO) verification team has conducted the verification of the Pa Khoang hydropower project to ensure that the claimed emission reductions attributable to the project during the monitoring period is in conformity with all applicable CDM requirements including the CDM modalities and procedures, and relevant decisions by the COP/MOP and the CDM Executive Board. The verification of Pa Khoang hydropower project consisted of following three phases: 1) Desk of the monitoring methodology and monitoring plan, and relevant data and information; 2) On-site assessment of monitoring practices and records, and interviews with relevant monitoring and management personnel; and, 3) Resolution of outstanding issues and issuance of the final verification report and statement. During the verification, the team assessed, using objective evidence, the completeness and accuracy of the claimed emission reductions and conservativeness of the assumptions made in the monitoring report. In addition, the team assessed whether the monitoring of emission reductions were carried out in compliance with the relevant requirements set out in the CDM modalities and procedures, the applicability conditions of the selected monitoring methodology and guidance issued by the CDM Executive Board. In conclusion, the verification team is of the opinion that the Pa Khoang hydropower project has achieved an emission reduction of 6,177 tco2e in the period of 25/12/2010 to 29/02/2012 in compliance with all applicable requirements for the CDM by properly implementing the data management system and quality control system. Report No.: Subject Group: GHGCC(E) Report title: Pa Khoang hydropower project Work carried out by: Kim Dae-Hwan (Team Leader), Lee Young- Seop (Team Member Under-observation) Work ed by: Indexing terms UNFCCC/Kyoto Protocol/CDM Validation / Verification No distribution without permission from the Client or responsible organisational Han, Seung-Ho Limited distribution Date of this revision: Rev. No.: Number of pages: 03/07/ Unrestricted distribution

3 Abbreviations AM BM CAR CDM CEF CER CL CMP COP/MOP CO 2 CO 2 e DOE ER EVN FAR GHG GWP IPCC KEMCO LOA MM MP MoV PDD QA QC UNFCCC (CDM) VVM Automatic Meter Backup Meter Corrective Action Request Clean Development Mechanism Carbon Emission Factor Certified Emission Reduction Clarification Request CDM Modalities and Procedures Conference of the Parties serving as the meeting of the Parties to thy Kyoto Protocol Carbon dioxide Carbon dioxide equivalent Designated Operational Entity Emission Reduction Electricity of Viet Nam Forward Action Request Greenhouse gas(es) Global Warming Potential Intergovernmental Panel on Climate Change Korea Energy Management Corporation Letter of Approval Main Meter Monitoring Plan Means of Verification Project Design Quality Assurance Quality Control United Nations Framework Convention on Climate Change Clean Development Mechanism (CDM) Validation and Verification Manual

4 Table of Contents Page 1 INTRODUCTION Objective Scope Project Description 2 2 METHODOLOGY Review of s Site Visit and Interviews Clarification, Corrective Action and Forward Ation Requests Internal Quality Control 6 3 VERIFICATION FINDINGS Project implementation in accordance with the registered design document Compliance of the monitoring plan with the monitoring methodology Compliance of monitoring with the monitoring plan Assessment of data and calculation of GHG emission reductions 12 4 PUBLICATION OF MONITORING REPORT VERIFICATION STATEMENT REFERENCES Appendix A : Verification Protocol Appendix B : CVs of Verification Team and the technical er

5 1 INTRODUCTION Bunge Emissions Holdings Sarl. has commissioned Korea Energy Management Corporation (KEMCO) to perform the verification of the Pa Khoang hydropower project (hereafter called the project ). This report summarizes the verification findings for the project, as well as means of verification to assess the correctness of the information provided by the project participants. The verification team consisted of the following personnel: Team Technical Expert Role Name Organization Technical areas Leader, Area Kim Dae-Hwan Team Member Lee Young-Seop Under-observation KEMCO GHG Certification Office KEMCO GHG Certification Office Participation Desk Site visit 1-2, Technical er Han Seung-Ho KEMCO GHG Certification Office 1-2, 13-2, 14-1, Objective The purpose of verification is to ensure that the project activity has been implemented and operated as per the registered PDD. In particular, it will be verified that all physical features (technology, project equipment, and monitoring and metering equipment) of the project are in place, and actual monitoring practices and data management are in accordance with the monitoring methodology and all applicable CDM requirements. 1.2 Scope The verification scope is defined as an independent and objective of: - Physical features of the project; - GHG sources and types to be included within the project boundaries; - Monitoring plan and practices; - Calculation of emission reductions; - Accuracy of data collected, transferred, and reported; and, - Data management system. The verification scope can be extended depending on project-specific situations or required by relevant decisions by the COP/MOP and the CDM Executive Board. 1

6 1.3 Project Description The Pa Khoang hydropower project is a grid-connected hydropower project which is located in the Nam Phang stream, whose length and watershed area are approximately 18km and 77 km 2 respectively. This, plus a gross head down the terrain of approximately 60m will facilitate construction of the proposed hydropower plant. The project is built downstream of the existing Pa Khoang Irrigation Reservoir to exploit the water in the Nam Phang stream from the reservoir. The penstock of the project is directly connected to the outlet point of the Pa Khoang reservoir. The water through the plant is discharged into the Thac Trang hydropower reservoir. The total installed capacity of the project is 2.4 MW with total expected annual net generation of 11,760 MWh of electricity (as stated in the registered PDD). The project delivers electricity to the national grid system via a 35kV transmission line at the out-going feeder. The main construction structures of the project consist of a penstock and a powerhouse containing turbines, generators and transformers. There is no new reservoir created for the project and the project utilizes an existing one. As per the registered PDD, it is expected that CO2 emission reductions achieved by the project activity are approximately 7,080 tco2/yr. The project activity for registration has been validated by KEMCO and registered on 27/08/2010. The project participants selected the renewable crediting period of which the first period spans from 25/12/2010 to 24/12/2017. The first monitoring period which the project participants claim emission reductions is about 14 months, from 25/12/2010 to 29/02/2012, and resulting emission reductions are 6,177 tco2e. The emission reductions claimed by the project participants for this first monitoring period are below the expected annual amount of emission reductions during the crediting period in the registered PDD. 2

7 2 METHODOLOGY The verification may consist of the following three phases: 1. Desk of the monitoring methodology and monitoring plan, and relevant data and information; 2. On-site assessment of monitoring practices and records, and interviews with relevant monitoring and management personnel; and, 3. Resolution of outstanding issues and issuance of the final verification report and statement. In order to ensure transparency, a verification protocol was customized for the project, according to the Validation and Verification Manual. The protocol shows in transparent manner, criteria (requirements), means of verification and the results from verifying the identified criteria. The verification protocol serves the following purposes. It organizes, details and clarifies the requirements a CDM project is expected to meet; It ensures a transparent verification process where the verifier will document how a particular requirement has been verified and the results of the verification. The verification protocol consists of two tables. The different columns in these tables are described in Figure 1. The completed verification protocol is enclosed in Appendix A to this report. Findings established during the verification can either be seen as a non-fulfillment of verification protocol criteria or where a risk to the fulfillment of project objectives is identified. Corrective Action Request (CAR) is issued, where: 1. Non-conformities with the monitoring plan or methodology are found in monitoring and reporting, or if the evidence provided to prove conformity is insufficient; 2. Mistakes have been made in applying assumptions, data or calculations of emission reductions that will impair the estimate of emission reductions; 3. Issues identified in a FAR during validation to be verified during verification have not been resolved by the project participants. The verification team may also raise Clarification Request (CL), which would be where: 1. Information is insufficient or not clear enough to determine whether the applicable CDM requirements have been met. The verification team may raise a forward action request (FAR) during verification for actions if the monitoring and reporting require attention and/or adjustment for the next verification period. 3

8 Figure 1 Verification protocol tables Checklist Question /VVM Criteria The various requirements in Table 1 are linked to checklist questions the project should meet. The checklist is organised in seven different sections. Each section is then further sub-divided. The lowest level constitutes a checklist question. Verification Protocol Table 1: Requirement checklist Reference Means of Comments verification (MoV) Gives Explains how The section is reference to conformance with used to elaborate documents the checklist and discuss the where the question is checklist question answer to investigated. and/or the the checklist Examples of means conformance to question or of verification are the question. It is item is document further used to found. (DR) or interview explain the (I). N/A means not conclusions applicable. reached. Draft and/or Final Conclusion This is either acceptable based on evidence provided (), or a Corrective Action Request (CAR) due to noncompliance with the checklist question (See below). Clarification is used when the verification team has identified a need for further clarification. Verification Protocol Table 2: Resolution of Corrective Action and Clarification Requests Draft report clarifications and corrective action requests Ref. to checklist question in table 2 Summary of project owner response Verification conclusion If the conclusions from the draft Verification are either a Corrective Action Request or a Clarification Request, these should be listed in this section. Reference to the checklist question number in Table 2 where the Corrective Action Request or Clarification Request is explained. The responses given by the Client or other project participants during the communications with the verification team should be summarised in this section. This section should summarise the verification team s responses and final conclusions. The conclusions should also be included in Table 2, under Final Conclusion. 4

9 2.1 Review of s The Monitoring Report (Version 0.1) dated 19/03/2012 (Monitoring Period: 25/12/2010 to 29/02/2012) was assessed along with additional background document /2/ - /20/ related to the project design, baseline and monitoring were assessed as a part of verification. The desk focused mainly on the following aspects: Implementation in accordance with the registered project design document; Compliance of the monitoring plan with the monitoring methodology; Compliance of monitoring with the monitoring plan; and, Assessment of data and calculation of greenhouse gas emission reductions. 2.2 Site Visit and Interviews On 03/04/2012, KEMCO conducted the site visit and performed the physical site inspection and interviews with project stakeholders in order to confirm compliance of the project implementation with all applicable CDM requirements and to resolve issues identified in the desk. As a part of the site visit, site supervisor and operators of Duc Thanh Commercial and Manufacturing Company and project consultants of Kyoto Energy Pte Ltd. were interviewed. The main topics of the interviews are summarized in Table 1. Table 1 Interview topics Interviewed organization Duc Thanh Commercial and Manufacturing Company Kyoto Energy Pte Ltd. Interview topics Facilities installation and project implementation Monitoring methods and frequency Data collection, transfer, and reporting Monitoring data QA/QC Data management system Application of monitoring methodology Monitoring plan Emission reduction calculation 2.3 Clarification, Corrective Action and Forward Action Requests As a result of the desk and subsequent site visit, the KEMCO verification team raised Clarification and Corrective Action which were presented to the project participants in the form of KEMCO s NC report as of 10/04/2012. In addition, it was informed to the project participants that the verification team could not request issuance of CERs claimed during the selected monitoring period unless all CARs and CLs are closed out. To guarantee the transparency of the verification process, the concerns raised are documented in the verification protocol in Appendix A. 5

10 2.4 Internal Quality Control The final verification report went through technical before requesting issuance of CERs claimed during the selected monitoring period. The technical was performed by the technical er qualified in accordance with KEMCO s Procedure for Review of Validation and V&C mainly in terms of verification procedures and results, and approved by Director of KEMCO s GHG Certification Office. 6

11 3. VERIFICATION FINDINGS In the following sections the findings of the verification are stated. The verification findings for each verification subject are presented as follows: 1) The findings from the desk of the monitoring report and relevant documents, and the findings from physical site inspection and interviews during the site visit are summarized. These findings are described in detail in the verification protocol in Appendix A. 2) Where the verification team had identified issues that needed clarification or that represented a risk to the fulfillment of the project objectives, a Clarification or Corrective Action Request, respectively, have been issued. The Clarification and Corrective Action Requests are stated, where applicable, in the following sections and are further documented in the Verification Protocol in Appendix A. 3) Where Clarification or Corrective Action Requests have been issued, the communications between the client and KEMCO to resolve these Clarification or Corrective Action Requests are summarized. 4) In conclusion, the verification opinion of the verification team has been presented. The final verification findings are based on the revised monitoring report (Version 1.5, dated 21/06/2012) and re-submitted supporting documentation. 3.1 Project implementation in accordance with the registered project design document In order to check whether any deviation from the registered PDD occurs in terms of the project facilities, the verification team ed a schematic diagram and looked carefully at all the structures, plant and surroundings during the site visit on 03/04/2012. Through the physical inspection, the verification team confirmed that a weir and penstock were constructed as described in the registered project design document. It was confirmed by directly observing the name plates that the total of two hydropower generation sets (2 units of 1.2 MW), were in place in accordance with the registered PDD. The commercial operating date was also confirmed by ing the report on commissioning of the power measurement system (25/12/2010) which states four stakeholders including North Vietnam Electricity Company (buyer), Dien Bien Electricity Company, North Vietnam Electricity Testing Company, and the project owner, confirmed together that the power measurement system for the project meet relevant requirements. The project is now under operation. The verification team also checked measuring points and monitoring equipment. It was confirmed by a schematic diagram and direct observation during the site visit that as described by the registered PDD, the main meter which measures exported electricity and imported electricity at the same time was located at the power house before the electricity is transmitted to the national grid. On the other hand, it was took note that installation of a backup meter in preparation for breakdown of the main meter was delayed about three months after the installation of the main meter. It is confirmed during this period the MM functioned 7

12 properly and the need for use of the backup meter did not arise. The Electricity Sales Receipts had also been issued properly based on the readings of the main meter during the period when the installation of a backup meter was delayed. For this reason, a main meter only was calibrated the same date as the commercial operating date. Subsequently the back up meter, which was calibrated, was installed on 19/03/2011 while the existing main meter was replaced by a new one for more synchronization purposes. The verification team checked by crosschecking calibration certificates and serial numbers of the meters that the main meter and backup meter installed at the project site were calibrated when they have been installed and hence conforms to the registered monitoring plan and the applied methodology. Hence the verification team confirms that there was no information provided in the monitoring report that is different from that stated in the registered PDD. By ing monthly records on net electricity generation and electricity sales receipts, the verification team concluded that the net electricity by the project is delivered to the national grid system via a 35 kv transmission line, and the project owner, Duc Thanh Commercial and Manufacturing Company has been selling the electricity to the power purchasing company, EVN in accordance with a power purchasing contract as described in the registered PDD. During the site visit, the verification team also checked whether there is any fossil fuel consumption for the project activity. The team confirmed that the project s internal needs are satisfied in one of two ways; using a part of the electricity generated by the project itself when the hydropower plant is operational or by using electricity imported from the grid when the hydropower plant is not operational. In either case there are no fossil fuel consumptions onsite. In both cases, the electricity consumed is taken into account for the calculation of emission reductions. In the first case, the consumption occurs before the monitoring point for the main (and backup) meter(s). Hence the exported electricity monitored is the net electricity generation excluding this internal consumption. In case of the electricity imported from the grid, this amount is monitored by the main (and backup) meter(s) and is properly deducted from the exported electricity to account for the net generated electricity delivered to the grid which is used to calculate emission reductions. It is noted that the emission reductions claimed by the project participants are below, but not significantly lower than, the amount estimated at the project design stage. It is deemed reasonable to assume that the reduced electricity generation was affected by unexpected variations in annual precipitation in the local area. Two CARs were raised regarding installation of the project equipment and then closed as follows; CAR1: Some specifications of turbine and generator in the PDD are not consistent with the nameplates attached in the installed equipments. This discrepancy is requested to be corrected. (See Appendix A. Checklist A.1.); Corrective Action: At the time of PDD development, all the specifications of equipment were input from the feasibility study. The differences between FSR and the actual name plates are found to be minor: 8

13 a. Turbine discharge speed has only been rounded down from 2.62 m 3 /s in the PDD compared to 2.6 m 3 /s on the name plate so it can be considered there is no difference; b. Turbine output actually very slightly decreased from 1272kW in the PDD compared to 1263kW on the name plate (0.7% decrease), in addition: - The same turbine model HLA696-WJ-71 was installed as per PDD. - The rated output of the generator is as per PDD and this is the limiting factor when determining overall installed capacity of project as described in registered PDD - The very slight difference in turbine capacity has no impact on the generator capacity and hence has not changed the effective output of the plant; it is in line with the registered PDD. c. Generator runaway speed marginally increased from 1500rpm in the PDD compared to 1600rpm on the name plate. But the runaway speed is not a parameter that affects output. The runaway speed of a water turbine is its speed at full flow, and no load on the shaft. The turbine will be designed to survive the mechanical forces of this speed. The above do not impact the effective output capacity of the proposed project as described in the registered PDD. Values of turbine and generator in the nameplates have been updated in the MR. Conclusion: It is confirmed that the discharge rate and output of turbines and runaway speed of generators are corrected in line with the nameplates of the equipment. However, the capacity of generators in the nameplates is the same as PDD and the difference above is not significant so that the scale, effective output or applicability of the applied methodology by the project activity is affected. The NC is therefore closed. CAR2: The serial number of the new main meter in the monitoring is not consistent with the calibration certificates for the meter. (See Appendix A. Checklist A.1.); Corrective Action: The serial number of the new main meter is corrected in Annex 1, MR from Elster, A1700, No to Elster, A1700, No to be consistent with the calibration certificate. Conclusion: The serial number of the new main meter is corrected properly. The NC is therefore closed. To conclude, the verification team could assess that all physical features of the proposed CDM project activity proposed in the registered PDD are in place and that the project participants have operated the proposed CDM project activity as per the registered PDD. 9

14 3.2 Compliance of the monitoring plan with the monitoring methodology The methodology applied for this project, AMS-I.D (Version 13) stipulates that monitoring shall consist of metering the electricity generated by the renewable technology, and if fossil fuel is used the electricity generation metered should be adjusted to deduct electricity generation from fossil fuels using the specific fuel consumption and the quantity of fossil fuel consumed. The verification team ed a schematic diagram, monthly records on net electricity generation and ERs calculation spreadsheets to check compliance of monitoring plan with the monitoring methodology. It was confirmed that the net electricity generated by the project activity is continuously measured by the main meter as well as backup meter as stipulated in the applied methodology, AMS-I.D (Version 13). The verification team verified that the actual implementation of the measurement frequency is more conservative than the frequency (hourly) stated in the registered PDD and hence is conservative. The baseline emissions are calculated by multiplying the monitored net electricity exported to the national grid by the electricity grid emission factor according to the methodology. It was also confirmed that project emissions are considered as zero in accordance with the applied methodology because the project does not utilize fossil fuels for the activity as mentioned in Section 3.1 of this report. And leakage emissions are also considered as zero for the project activity as no equipment is transferred from another activity. All measuring parameters and monitoring method were ed to decide necessity of a revision or a deviation on the monitoring plan. It was confirmed by ing monthly records on net electricity generation and ERs calculation spreadsheets that the project does not need to request a revision or a deviation of the monitoring plan because the monitoring plan conforms to the monitoring methodology, and the project activity has been also conducted in accordance with the applied methodology. An interview with the site supervisor during the site visit supports these conclusions. The verification team ed whether monitoring aspects that are not specified in the methodology exist on this monitoring plan. It was confirmed during the site visit that there are no additional monitoring aspects that are not specified in the methodology. Hence it can be stated that the monitoring plan is in accordance with the approved methodology applied by the proposed CDM project activity. 3.3 Compliance of monitoring with the monitoring plan The verification team checked whether emission sources and monitoring parameters are in accordance with the registered monitoring plan. It was confirmed by a schematic diagram and direct observation during the site visit that net electricity exported to the national grid is the only parameter monitored and do not use fossil fuel in the site as described in the PDD. It was also found during the site visit that some of electricity generated by the hydropower facilities 10

15 is used for operating purposes in the project site, but the amount of electricity used in the project boundary is automatically excluded from emission reductions because after used for the site, the net electricity is monitored just before the connection point with the national grid. It was confirmed that the monitoring procedure is established and performed in line with the monitoring plan. The monitoring report describes that net electricity as a monitored parameter is measured continuously, read and recorded monthly. As an electronic meter was installed for the monitoring, the measuring frequency was increased comparing to hourly measurement as described in the PDD. In order to confirm whether in practice the monitoring has been conducted in accordance with the monitoring plan or not, the verification team ed a schematic diagram and monthly records on net electricity generation, and performed direct observation and interview with an operator during the site visit. It was confirmed that the project activity has been properly implemented in line with the monitoring plan; the amount of the net electricity by the project activity was measured continuously by a main meter (MM) and a backup meter (BM) and recorded on a monthly basis by the project monitoring team. It was also confirmed that the monitored data is recorded and kept in safety to ensure continuous project management. During the site visit, the verification team confirmed that the data monitored by a MM and a BM is stored in the computer on a monthly basis and sent to a project consultant s computer to ensure safe data archiving and carry out external audits. This point was confirmed by interviewing the consultant company. With regards to monitoring organization, it is confirmed that the monitoring report describes concretely the structure, staff and responsibilities of the monitoring team. The verification team confirmed that operators carried out properly their responsibility for monthly recording and site managers implemented monthly cross-check of records from EVN against metered data. It was also confirmed that the project manager read the metered value together with EVN staff on the first day of every month and then they completed a monthly log book, and finally they made the minute of meter value confirmation which is used for an electricity sales receipt. This point was confirmed by checking electricity sales receipts and interviewing site supervisors and operators during the site visit. The monitoring report explains that a training program for the monitoring staff was conducted on 22/12/2010 to inform them of project details and relevant monitoring plan requirements. During the site visit, the verification team interviewed the site manager and operators, and found that they had a proper understanding of monitoring requirements. It was confirmed by checking the training material and attendance list during the site visit that all the site supervisors and operators listed in the monitoring report were trained and the training program was successfully performed. With regard to a fixed parameter for the baseline emissions, it was confirmed that tco2/mwh is used for a CO2 emission factor as described in the registered PDD and thus is correctly applied. And it was also verified by ing calculation sheets that the claimed emission reductions do not consider leakage emissions as none are attributable to the project (in line with the applied baseline and monitoring methodology). The verification team also ed the compliance of monitoring with the registered 11

16 monitoring plan relating to the monitoring equipments and their management. The verification team found that during the monitoring period, the main meter was calibrated by the North Vietnam Electricity Testing Company on the same date as the commercial operating date whereas installation and calibration of the backup meter and of the new main meter was done about three months after the installation of the first main meter. During the monitoring period, no emergency situations like malfunction of a meter, are reported when they occurred (internal incident report, EVN receipts). The verification team can confirm that such event did not occurred during the monitoring period. As per the approved monitoring plan, the calibration of both the main meter and backup meter are implemented three years after the last calibration date, i.e. 19/03/2011 for the two meters currently installed. It is therefore confirmed that the calibration certificates are valid during the monitoring period. It was further confirmed by ing the meter calibration certificates that the maximum permissible error of the main and backup meter was 0.5%. With regards to QA/QC procedures of monitored data, the monitoring report explains that data recorded from a main meter is cross-checked with electricity sales receipts and a backup meter is installed to use in the event of a main meter failure as described in the monitoring plan of the registered PDD. It was found that main meter values have been recorded on a monthly basis and electricity sales receipts have been made monthly by the project owner and the power purchaser, and a backup meter has also been operated with periodic calibration. It was also verified during the site visit that the monitored data is kept in a computer as well as a paper form at the site and sent to the project consultant monthly for data archiving and external audits. So the verification team concluded that the QA/QC procedures were properly implemented as described in the monitoring report and registered PDD. Two CARs were raised regarding calculation of ERs and QA/QC implementation and then closed out as follows; CAR3: The table for comparison of actual emission reductions with estimates in the CDM-PDD in the Section E.5 of the monitoring report does not include ERs during the period of 25/12/2010 to 31/12/2010 whereas the table for monthly emission reductions in the Section E.4 of the monitoring report includes the amount. In addition, the comparing period in Year 2 is not compatible with each other. This discrepancy is requested to be corrected. (See Appendix A. Checklist C.1.); Corrective Action: The table in section E5 of the PDD is updated for the comparison of actual emission reductions and estimates. Now both table E4 and E5 shows net electricity exported for the entire monitoring period including that of the period covering from 25/12/2010 to 31/12/2010. Ex-ante calculation of ERs in year 3 (for 2 months) is derived from PDD as: 7.080/12*2= 1,180 (tco2e). Conclusion: The table in section E5 of the PDD is corrected properly. The NC is therefore closed. 12

17 CAR4: Positions of monitoring team to operate and manage the hydropower system are inconsistent among the PDD, Internal Monitoring Plan (IMP) and the monitoring report. This discrepancy is requested to be corrected. (See Appendix A. Checklist C.1.); Corrective Action: The names of those positions described in imp are corrected to be conformed with PDD and MR. Conclusion: The names of those positions described in imp are corrected consistently with PDD and MR. The NC is therefore closed. To conclude, the verification team could verify that the monitoring plan and the applied methodology have been properly implemented and followed by the project participants. The verification team checked all emission parameters used for baseline, project and leakage emissions calculation. The responsibilities and authorities for monitoring and reporting as described in the monitoring plan of the registered PDD conforms with the responsibilities and authorities for monitoring and reporting, actually implemented at the site. Then it could be confirmed that all parameters stated in the monitoring plan, the applied methodology and relevant CDM Executive Board decisions have been sufficiently monitored as applicable. Finally, the team could verify that the accuracy of equipment used for monitoring is controlled and calibrated in accordance with the monitoring plan. Indeed, the monitoring results are consistently recorded as per approved frequency and the quality assurance and quality control procedures have been applied in accordance with the monitoring plan. 3.4 Assessment of data and calculation of GHG emission reductions In order to confirm a complete set of data for the monitored period available, the verification team ed data records during the whole monitoring period. The verification team confirmed that an entire data set for the monitored period is available. It was also checked that continuous measurement of net electricity generation by an electronic meter and monthly reading and recording of measured values were being properly carried out. In order to assess the monitored data, the verification team cross-checked the data monitored by a main meter with a backup meter data. Comparison results showed that the values of a main meter and a backup meter were as almost same as substitutable each other in case of one meter breakdown. In addition, the values of the monitored data (log books) were crosschecked with the Electricity Sales Receipts which are published by EVN after confirmation of both parties (the project owner and power purchasing company). In summary, the verification team concluded that the monitored data is reliable and authentic because the values read on the main meter are equal to the values of electricity sales receipts which are made by a power purchasing company for the whole monitoring period. 13

18 The verification team also assessed whether calculations of baseline emissions, project emissions and leakage emissions are in accordance with the monitoring plan and the applied methodology. It was confirmed by the calculation sheets submitted to the DOE that baseline emissions are calculated by multiplying the monitored net electricity export to the national grid by a CO2 emission factor according to the monitoring plan and the applied methodology, AMS-I.D (Version 13). It was also checked that the CO2 emission factor used for calculating the emission reductions is in accordance with the registered PDD and hence is correctly applied. The verification team also confirmed that the project emissions and leakage emissions need not be considered which is in compliance with the monitoring plan and the applied methodology. Hence, it can be conclude that appropriate methods and formulae for calculating baseline emissions, project emissions and leakage have been followed. One CAR and one CL were raised regarding verification of data on net electricity generation and then closed out as follows; CAR5: The verification team found that the backup meter data of June 2011 and the main meter and backup meter data of February 2012 in the emission calculation sheets the project participant submitted are different from the data stored in a computer of the project site in log files and electricity sales receipts issued by EVN (Electricity of Vietnam). This discrepancy is requested to be corrected. (See Appendix A. Checklist D.1.); Corrective Action: The import value of the backup meter in June 2011 was shown as 1,554 kwh in the emission calculation sheet. The number is corrected to the value of 1,544 kwh conforming to the log file as well as the EVN receipt in June In addition, the export and import value of the main meter in February 2012 were shown as 1,000,100 kwh and 412 kwh in the emission calculation sheet. These numbers are corrected to the value of 909,703 kwh and 770 kwh conforming to the log file as well as the EVN receipt in February The export and import value of the backup meter in February 2012 were shown as 1,000,053 kwh and 415 kwh in the emission calculation sheet. These numbers are corrected to the value of 909,384 kwh and 791 kwh conforming to the log file as well as the EVN receipt in February Conclusion: The emission calculation worksheets are updated properly. The NC is therefore closed. CL1: To demonstrate net electricity generation for the first month of monitoring period. For the month of December in 2010, the project participants submitted the Electricity Sales Receipts for the period. But they did not submit log sheets for the period. The verification team could not ensure that the monitoring procedure had been implemented properly. (See Appendix A. Checklist D.1.); 14

19 Corrective Action: The internal monthly log sheets for the period of 30/12/ /12/2010 are submitted to prove that the monitoring procedures have been properly implemented during the period. Conclusion: It is confirmed that the monitoring for the period of 30/12/2010 to 31/12/2010 was properly carried out. The NC is therefore closed. 4. PUBLICATION OF MONITORING REPORT In accordance with the "Procedures for making the monitoring report available to the public in accordance with paragraph 62 of the modalities and procedures for the CDM, the monitoring report for the period of 25/12/2010 to 29/02/2012 for the CDM project activity Pa Khoang hydropower project (Ref. no. 3514) had been posted on the UNFCCC CDM website on 20/03/

20 5. VERIFICATION STATEMENT The KEMCO verification team has undertaken verification of the emission reductions reported by the registered project: Pa Khoang Hydropower Project. The verification is based on the requirements of the CDM, i.e. UNFCCC, Kyoto Protocol, Marrakesh Accords, Decision 3, 4/CMP.1 and relevant decisions of the CDM executive board. For a risk-based approach to verification of the reported emission reductions, the Monitoring Manual and Monitoring Report was ed against the registered Project Design in terms of their completeness, accuracy, consistency, transparency, conservativeness, and materiality. As a result, several potential risks of departures from the requirements for the CDM were identified. The assessment of management controls was made in order to examine such potential risks and then additional audit testing was performed through sample check to identify residual risk areas. Based on the results of this assessment, the verification team issued five Corrective Action Requests (CARs), and one Clarification Request (CL). In response to the request for such corrective actions, the project participants provided to the verification team the revised Monitoring and Reporting Procedure, Monitoring Report, and relevant documentation, and the verification team then made through of the corrective actions and agreed that the raised non-conformities were cleared. In conclusion, the verification team is of the opinion that the Pa Khoang hydropower project has achieved an emission reduction of 6,177 tco2e in the period of 25/12/2010 to 29/02/2012 in compliance with all applicable requirements for the CDM by properly implementing the data management system and quality control system. Reporting period: From 25/12/2010 to 29/02/2012 Verified emissions in the above reporting period: Project emissions: 0 tco2e Baseline emissions: 6,177 tco2e Leakage emissions: 0 tco2e Emission reductions: 6,177 tco2e 16

21 6 REFERENCES Category 1: s and electronic files submitted by the Project Participants /1/ Monitoring Report (Version 1.5, 21/06/2012) /2/ CER Calculation Spreadsheets (Version 0.4) /3/ Electricity Sales Receipts, Electricity of Viet Nam (EVN), 25/12/2010 ~ 29/02/2012 /4/ /5/ /6/ Calibration report of main meter, North Vietnam Electricity Testing Company, 25/12/2010 Calibration report of main meter, North Vietnam Electricity Testing Company, 19/03/2011 Calibration report of back-up meter, North Vietnam Electricity Testing Company, 19/03/2011 /7/ Internal Monitoring Plan (Version 1.1), Kyoto Energy Pte Ltd., 29/06/2011 /8/ Training presentation material, Kyoto Energy Pte Ltd., 22/12/2010 /9/ Training attendance list, Duc Thanh Commercial and Manufacturing Company, 22/12/2010 /10/ Report on Commissioning of the Power Measurement System, North Vietnam Electricity Company, 25/12/2010 /11/ Report on Improving the Measurement System at the Pa Khoang power plant, North Vietnam Electricity Company, 19/03/2011 /12/ Monthly records on net electricity generation, Duc Thanh Commercial and Manufacturing Company, Dec ~ Feb Category 2: s and websites referred to by KEMCO /13/ Clean Development Mechanism Validation and Verification Manual (Version 01.2) /14/ AMS-I.D Grid connected renewable electricity generation (Version 13) /15/ Tool to calculate the emission factor for an electricity system (Version 2.0) /16/ General guidelines for SSC CDM methodologies (Version 17) /17/ Project Design (Version 2.4, 19/03/2010) /18/ Validation Report (Version 03, 19/03/2010) /19/ Guidelines for Assessing Compliance with the Calibration Frequency Requirements (Version 01) /20/ Homepage of a main meter manufacturer, 17

22 Persons interviewed: List persons interviewed during the verification, or persons contributed with other information that are not included in the documents listed above. Duc Thanh Commercial and Manufacturing Company Le Van Thanh (Project Director) Pham Quoc Viet (Site Supervisor) Luong Van Phuong (Operator) Kyoto Energy Pte Ltd. Arijit Paul (Regional Representative) Nguyen Chung Kien (CDM Project executive) - o0o- 18

23 APPENDIX A VERIFICATION PROTOCOL 19

24 Table 1. Verification Checklist Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO A Project Implementation in accordance with the registered project design document In this section, the DOE shall identify any concerns related to the conformity of the actual project activity and its operation with the registered project design document. A.1. Are all physical features of the proposed CDM project activity proposed in the registered PDD in place and has the project participants operated the proposed CDM project activity as per the registered PDD by means of an on-site visit? If an on-site visit is not conducted, the DOE shall justify the rationale of the decision. Para 195 Para 196 /1/, /14/, /17/ /1/, /14/, /17/ /1/, /4/~/6/, /14/, /17/, Observation, Observation 1. Checked: The registered PDD states that the project activity will install a total installed capacity of 2.4 MW. The verification team confirmed by directly observing the name plates during the site visit that 2 units of 1.2 MW were installed for the project activity. 2. CAR1: Some specifications of turbine and generator in the PDD are not consistent with the nameplates of the installed equipments. This discrepancy is requested to be corrected. 3. Checked: The registered PDD and monitoring report state that electricity generated by each generating system is transformed to 35kV at the powerhouse and is delivered to the national grid system via a 35kV transmission line. The verification team confirmed these facts by ing the schematic diagram during the site visit. 4. Checked: It is confirmed by ing calibration certificates for a main meter and back-up meter that the monitoring CAR

25 Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO equipment is installed in line with the registered PDD. The adequacy of monitoring points and serial numbers of meters was also confirmed during the site visit. 5. CAR2: The serial number of the new main meter in the monitoring is not consistent with the calibration certificates for the meter. CAR A.2. Does the implementation or operation of CDM project activity conform with the description contained in the registered PDD? If not, the DOE shall conduct an assessment on the potential impacts due to these changes following the relevant guidelines established by the CDM Executive Board and based on this assessment the DOE shall submit a notification or a request for approval of changes from the project activity as described in the registered PDD prior to the conclusion of the verification/certification for the corresponding monitoring period. Para 197 (Para 198) /1/, /3/, /14/, /17/ /1/, /14/, /17/, Interview 1. Checked: The verification team ed monitoring report and electricity sales receipts to check operation status of the units and facilities in the project site. It was confirmed that the plant has been operated during the full monitoring period, 25/12/2010 to 29/02/ Checked: The emission reductions claimed by the project participants are 6,177 tco2 for about 14 months and slightly below the amount estimated at the project design stage. B Compliance of the monitoring plan with the monitoring methodology The monitoring plan of the proposed CDM project activity shall comply with the applied methodology. Para 199

26 Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO B.1. Is the validated monitoring plan in accordance with the approved methodology applied by the proposed CDM project activity? Para 200 (Para 203) /1/, /14/, /17/ 1. Checked: the net electricity by project activity is monitored by the metering equipment during the monitoring period as it has been stipulated in the applied methodology, AMS-I.D (Version 13). It is also verified that baseline emissions are calculated as per the applied methodology, and project emissions as zero is in accordance with the applied methodology. And leakage emissions are considered as zero for the project activity as no equipment is transferred from another activity in accordance with the methodology. 2. Checked: it was also verified during the site visit that the project imports electricity from the grid for internal energy consumption. 1. Checked: It is confirmed by ing the monitoring report and working spreadsheets that the monitoring plan conforms to the monitoring methodology. Thus no revision to the monitoring plan has been requested. B.2. If during verification the DOE concludes that the monitoring plan is not in accordance with the monitoring methodology, the DOE shall request a revision to the monitoring plan prior to concluding its verification and making its certification decision. The DOE may request for revision of the monitoring plan covering the monitoring period under verification, for approval by the CDM Executive Board. Para 201 /1/, /14/, /17/

27 Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO B.3. Are there monitoring aspects that are not specified in the methodology, particularly in the case of small-scale methodologies (e.g. additional monitoring parameters, monitoring frequency and calibration frequency)? If so, the DOE is encouraged to bring to the attention of the CDM Executive Board issues which may contribute in enhancing the level of accuracy and completeness of the monitoring plan. Para 202 /1/, /14/, /17/ 1. Checked: It was confirmed during the site visit that there are no additional monitoring aspects that are not specified in the methodology, e.g. additional monitoring parameters, monitoring frequency and calibration frequency. C Compliance of monitoring with the monitoring plan Monitoring of reductions in GHG emissions to result from the proposed CDM project activity shall be implemented in accordance with the monitoring plan contained in the registered PDD or the accepted revised monitoring plan. C.1. Has it been confirmed that: Para 204 Para 205 (a) The monitoring plan and the applied methodology been properly implemented and followed by the project participants; (Para 206) /1/, /2/, /14/, /17/ 1. Checked: It is confirmed by ing the monitoring report, working spreadsheets, electricity sales receipts, and calibration certificates of a main meter (MM) and backup meter (BM) that the project activity has been properly implemented in line with the monitoring plan 2. Checked: the monitoring plan of the registered PDD describes that the electricity is measured continuously, read and recorded monthly. This procedure was confirmed by checking metering equipment and monthly records during the site visit. In addition, it was took note (b) All parameters stated in the monitoring plan, the applied methodology and relevant CDM Executive Board decisions have been /1/, /2/, /14/, /17/

28 Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO sufficiently monitored and updated as applicable including: (i) Project emission parameters; (ii) Baseline emission parameters; (iii) Leakage parameters; (iv) Management and operational system: the responsibilities and authorities for monitoring and reporting are in accordance with the responsibilities and authorities stated in the monitoring plan. /1/, /2/, /14/, /17/ that both parties (the project owner and power purchasing company) recorded the meter value on the following day after the end of the month concerned. 3. CAR3: The table for comparison of actual emission reductions with estimates in the CDM-PDD in the Section E.5 of the monitoring report does not include ERs during the period of 25/12/2010 to 31/12/2010 whereas the table for monthly emission reductions in the Section E.4 of the monitoring report includes the amount. In addition, the comparing period in Year 2 is not compatible with each other. This discrepancy is requested to be corrected. CAR /1/, /2/, /14/, /17/ 4. Checked: Project emissions are not required according to the applied methodology and the monitoring plan of PDD. It was checked during the site visit that there was no source of project emissions at the project site and the onsite power consumption was covered by the imported electricity. /1/, /2/, /14/, /17/ 5. Checked: It was checked that a CO2 emission factor used for calculating baseline emissions is in accordance with the registered PDD.

29 Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO /1/, /2/, /14/, /17/ 6. Checked: The applied baseline and monitoring methodology does not consider leakage emissions attributable to the project. /1/, /2/, /7/, /14/, /17/ 7. CAR4: Positions of monitoring team to operate and manage the hydropower system are inconsistent among the PDD, Internal Monitoring Plan (IMP) and the monitoring report. This discrepancy is requested to be corrected. CAR /1/, /2/, /8/, /9/, /14/, /17/, Interview 8. Checked: The Section C.6 in the monitoring report explains that training program to the monitoring staff was conducted on 22/12/2010 to inform the management details and its monitoring plan requirements. This point was confirmed by attendance list and training material. /1/, /12/ 9. Checked: The net electricity data recorded via a MM and a BM is stored as a log file type in computers of the project site and the consultant company as well as recorded in monthly log sheets. It was also confirmed that the records were sent to a project consultant s computer to ensure safe data archiving and carry out external audits.

30 Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO (c) The accuracy of equipment used for monitoring in accordance with the relevant guidance provided by the CDM Executive Board and controlled and calibrated in accordance with the monitoring plan; (i) Monitoring results consistently are recorded as per approved frequency; (ii) Quality assurance and quality control procedures have been applied in accordance with the monitoring plan. /1/, /2/, /10/, /11/ 10. Checked: The verification team found that during the monitoring period, the main meter was calibrated by the North Vietnam Electricity Testing Company on the same date as the commercial operating date whereas installation of a backup meter in preparation for breakdown of the main meter was delayed about three months after the installation of the main meter. During the period no emergency situations like malfunction of the main meter were reported. The Electricity Sales Receipts had also been issued properly based on the readings of the main meter during the period when the installation of a backup meter was delayed. Subsequently a backup meter was installed on 19/03/2011 while the existing main meter was replaced by a new one for more synchronization purposes. 11. Checked: It is confirmed that the QA/QC procedures of the monitoring report are in line with the registered monitoring plan. The monitoring report describes that data recorded from a main meter crosschecked with electricity sales receipts and a backup meter is operated to use in the event of a main meter failure as described in the monitoring plan. /1/, /2/, /7/, /10/, /11/, /12/

31 Verification Checklist VVM Criteria Ref. MoV Comments Draft Concl. Final Concl. KEMCO D Assessment of data and calculation of greenhouse gas emission reductions Para 207 GHG emission reductions achieved by/resulting from the proposed CDM project activity shall be calculated applying the selected methodology. D.1. The DOE shall determine whether: (a) A complete set of data for the specified monitoring period available. If only partial data are available because activity levels or nonactivity parameters have not been monitored in accordance with the registered monitoring plan, the DOE shall opt to either make the most conservative assumption theoretically possible in finalizing the verification report, or raise a request for deviation prior to submitting request for issuance, if appropriate; (b) Information provided in the monitoring report has been cross-checked with other sources such as plant log books, inventories, purchase records, laboratory analysis; Para 208 (Para 209) /1/, /2/, /3/, /12/, /14/, /17/ /1/, /2/, /3/, /12/, /14/, /17/ 1. Checked: It is confirmed that a complete set of data on net electricity generation is available on a monthly basis throughout the monitoring period. In addition, it was took note that both parties (the project owner and power purchasing company) recorded the meter value on the following day after the end of the month concerned. 2. CL1: To demonstrate net electricity generation for the first month of monitoring period. For the month of December in 2010, the project participants submitted the Electricity Sales Receipts for the period. But they did not submit log sheets for the period. The verification team could not ensure that the monitoring procedure had been implemented properly. 3. Checked: Baseline emissions were calculated by multiplying the monitored electricity by a CO2 emission factor in line with the monitoring plan and the applied methodology, AMS-I.D (Version CL /1/, /2/, /3/, /12/, /14/, /17/