OPEN JOINT STOCK COMPANY KHABAROVSKENERGO Investment project Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment Project Design Document Stakeholders Consultations Activities Prepared by: Energy Carbon Fund and Research Institute of Environmental Problems in the Power Sector Submitted by: Energy Carbon Fund Moscow, 2004
A 10 Stakeholder comments A 10.1 Identification of stakeholders In order to accomplish the requirement of stakeholders consultation, JSC Khabarovskenergo subsidiary asked by an official letter the stakeholders opinion related to participation of Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment project on ERUPT-4 Program. The stakeholders identified for the project are the local population, which is represented by Amursk town and Khabarovsk Region as well as elected body of representatives administration of the local area, and are competent to issue No- Objection and Permission set up the project. As implementation of such project switch from coal on environmentally advanced equipment natural gas, can t exert negative influence on environment, under the Russian legislation submission of impact estimation of the project on environment isn t required for Central Administrative Board of Natural Rerourses and Environment of Ministry of Natural Resources of Russia on Khabarovsk Region. Therefore, as stakeholders comments there will be letters of endorsements of the Mayor of Amursk and of administrative agent of Khabarovsk Region as well as official letter from Committee of Environmental Protection. Central Administrative Board of Natural Resources and Environment of Ministry of Natural Resources of Russia on Khabarovsk Region (on 15 August 2003) (Annex I); Governor of Khabarovsk Region (on 11 August 2003) (Annex II); Head of Amursk Town within Amursk Area (on 17 June 2003) (Annex III); The meetings, organized by JCS Khabarovskenergo for the independent validator, have been held with the Mayor of Amursk and Ministry of Fuel and Page 2
Energy of Khabarovsk Region where the endorsements of fully support by the authorized bodies of Khabarovsk Region this project were obtained. There were not address criticisms of project or objections. The public was also involved in the whole process by published article posted announcement (at daily newspaper The Pacific Star dated 12 July 2003) (Annex IV) and request for comments, suggestions and arguments for and against the project. No negative comments and arguments against the project were received, but positive comments regarding the improvements related with the environmental protection were received, as it is shown in the inhabitants letters (see Annex V for translation of these letters 1 ). Also the article about the participation of the Khabarovsk Project in the Netherlands Emission Reduction Unit Procurement Tender have been published in Russian Energy newspaper, which issued by RAO UESR (issue No 22, July 2003.) (Annex VI). A 10.2 Stakeholders involvement The project proponents have already approached and obtained their consent from various stakeholders and statutory bodies as detailed above. A 10.3 Stakeholders comments All stakeholders have issued their approvals and consents for setting up the project. The support letter copies are attached. 1 A copies of the original in Russian Language - are submitted by JSC Khabarovskenergo Page 3
Ministry of Natural Resources of the Russian Federation (MNR of Russia) CENTRAL ADMINISTRATIVE BOARD OF NATURAL RESOURCES AND ENVIRONMENT OF MNR OF RUSSIA ON KHABAROVSK REGION (CABNR on Khabarovsk Region) 6a, Kadrovy alley, Khabarovsk, 680013, tel.: (4212) 21-17-12, fax: (4212) 21-31-02, 21-17-12 E-mail: eco@pop.redcom.ru Dated 15.08.2003 No 2414 General director JSC Khabarovskenergo V.M. Levit Annex I Of approval of ERUPT project Central Administrative Board of Natural Resources and Environment of Ministry of Natural Resources of Russia on Khabarovsk Region approves participation of JSC Khabarovskenergo project Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment in ERUPT-3 tender, organized by Dutch Government, to purchase in the West Europe countries GHG emission reduction units generated through international Joint Implementation projects in accordance with the Kyoto Protocol to UN Framework Convention on Climate Change. Gasification of the boiler equipment of JSC Khabarovskenergo subsidiary Amursk CHP-1 is a part of one development tendency of Khabarovsk Region switch of heat (power) plants on burning of environmentally fuel natural gas. The project implementation allows reducing greatly emissions of harmful substances into free air including carbon dioxide on 360 000 t per year. Deputy Chief of V.M. Boltrushko Central Administrative Board of Natural Resources and Environment of MNR of Russia on Khabarovsk Region This is a true translation of the original document in Russian Page 4
Governor of Khabarovsk Region Karl Marx str., 56, Khabarovsk, 680000, tel.: 30-59-83, fax: 32-87-56 Annex II No 44/2-6653 dated 11.08.2003 Deputy Prime Minister Victor B. Khristenko Of signing Letter of Approval of ERUPT 3 tender project Dear Victor Borisovich! Within the next few years in Khabarovsk Region it is expected to implement a group of Switch of Environmentally Adverse Power Plants to Natural Gas projects, one of which is Switch of the Boilers of Amursk CHP-1. This allows reducing greatly noxious emissions to the air, to increase stability of energy system, to improve structure of the fuel balance and technical and economic indices of power and heat output. In 2003 JSC Khabarovskenergo together with Energy Carbon Fund with assistance of JSC RAO UES of Russia submitted this project to Dutch Emission Reduction Units Procurement Tender (ERUPT 3) according to Article 6 of the Kyoto Protocol to the UN Framework Convention on Climate Changes. As the result of the first phase of ERUPT 3 tender the above-mentioned project has been picked out for participation in the second, pre-contract phase. For such participation it is necessary to submit Letter of Approval of Government of the Russian Federation undertaking obligations to transfer verified ERUs generated through the project implementation from Russia to the Netherlands. The participation of the project Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment is the first in the Far East example of attracting carbon investment to the country. Taking into account great potential of Khabarovsk Region within GHG emission reduction due to increase of energy efficiency and energy saving of production and gasification of the Region as well as interest in such project implementation from the outside of foreign companies, I ask you, Victor Borisovich, to support the participation of the project Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment in ERUPT 3 tender and to send the Letter of Approval of the project by Government of the Russian Federation to the address of tender organizers. Yours sincerely, This is a true translation of the original document in Russian. V.I. Ishaev Page 5
Annex III ADMINISTRATION of AMURSK TOWN within AMURSK AREA of KHABAROVSK REGION 11, Mira avenue, Amursk, 682640 Tel. (42142) 2 44 66, Fax (42142) 2 04 28 E-mail: city@admin.amursk.ru Non-commercial Environmental Investment Organization Energy Carbon Facility Deputy Chief Executive Officer Mr. Rogankov To No 1-9/951 dated 17.06.2003 Dear Mikhail Petrovich, Having reviewed the project Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment realized by the non-commercial investment ecological organization Energy carbon Fund for the continuation (for further participation in the Dutch tender ERUPT, the Administration of the Amursk town and the Amursk region states the following: Now, according to the data contained in the State Report of the Natural Resources Department of the Far East region The conditions of the environment and the nature protection activity in the Khabarovsk region, City of Khabarovsk, 2002, 19.8 thous. t/y of the pollutants is released into the atmosphere of the Amursk town, including 13.730 thous. t/y of the pollutants from the industrial enterprises. The major share of the total volume of emissions is attributed to the Amursk CHP- 1 that is responsible for the emission of 12, 251 thous. t of the pollutants which constitutes 89.2% of the total volume of emissions by the industrial enterprises of the town. As can be seen from the dynamics of pollutant emissions to the atmosphere the minimum of the emissions at 15.6 thous. t relates to 1998, whereupon there had been continuous small rise. Amursk CHP-1 is to a great extent the solid fuel utilizing facility to fire various grades of coals, primarily from the Kharanorsk and Urgalsk coal fields. The share of the natural gas is significant. The major specific substances polluting the atmosphere of the town are: Xylol - 0.2 t/y Ethanol - 2.9 t/y Formaldehyde - 0.8 t/y Cyclohexanon - 13.3 t/y. Page 6
Thus, switch of two boilers No 9, 10 of Amursk CHP-1 from solid fuel to natural gas with the installation of the ecologically clean equipment will enable to a certain extent the prevention of the emissions to atmosphere not only fly ash but also the above mentioned harmful substances which is particularly with the existing wind rose which is responsible for the great share of the influence on individual districts of the town. The Program of using the natural gas for boilers No 9, 10 envisages continuous rise of operation hours from 5,478 in 2005 to 6,100 in 2012 with the appropriate increased share of the consume gas from 129,773 thous. nm 3 in 2005 to 146,400 thous. nm 3 in 2012. The calculated values of concentration of harmful substances in the flue gases from boilers No 9, 10 after switching them for gas will be as follows: the normative value of nitrogen oxide according to the State Standards (GOST): up to 470 mg/m 3 in normal conditions; actual value (maximum permissible value) based on the measurements and calculations for similar operating boilers; nitrogen oxide up to 600 mg/m 3 in normal conditions. Besides, the cost of the supplied electric energy generated on the steam of boilers No 9, 10 operating on gas is reduced due to the reduction of specific consumption of the fuel equivalent and the cost reduction. According to the aforegoing the Administration of the Amursk town and the Amursk region supports the project Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment and asks the Open JSC «Khabarovskenergo» to speed up the realization of the project. Head of Amursk Town G.G. Kuzminyh within Amursk Area This is a true translation of the original document in Russian Page 7
Translate the article summary at The Pacific Star (12 July 2003): Annex IV The Kyoto Protocol: Breathe deeper! The investment into the Russian Energy is going very hard, and into the Far East Energy them will be involved, its seems, at all impossible. However, there is one project, which costs some millions dollars, can be realized in practice. The matter concerns the Project Amursk CHP-1: Switch from Coal to Gas of Two Boilers with Implementation of Environmentally Advanced Equipment. At the end of the article: P.S. Please send all comments and wishes about this question to the editorial staff. Page 8
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Comments about this article: Annex V Whether foreign countries help us if we help them back? In the article Kyoto Protocol: breathe deeply! ( The Pacific Star dated 12.07.2003) you wrote about possible reconstruction of Amursk CHP-1 switch from Coal to Gas of Two Boilers. I should say straight it is good that there is such a project and funds for its implementation can be given by government of far Holland. Moreover, even if the project of Khabarovskenergo doesn t pass tender successfully, it is necessary to implement it by our own efforts: firstly, because the Far East will never achieve western regions of Russia in development and standards of living, having double disparity in energy tariffs in comparison with them. Such disparity appeared as most western CHPs run on inexpensive gas, and power engineering doesn t burn coal delivered from far regions as Russia does. Secondly, there is an environmental problem. It only seems to many people that we have not got it. Certainly, the Far East is a vast forest territory. In addition, its industry is not developed so much to damage to the living. Nevertheless it should notify that every year it becomes hard to breath fresh air in our towns. Concerning environmental issues we are moving that way where all Europe is in other words to the crisis. Can we wait quietly for its coming? It is clear that we can t. That is why I think all Amur people will speak in support of this joint project with Holland. Simonenko Valentina V., Amursk I would like to express my own view pertaining to subject matter of the article Kyoto Protocol: breathe deeply! published in The Pacific Star. The fact, that such project has been possible in principle, means Russia having become out of the iron curtain gained not only disadvantages but also advantages, as it seems to many people. There is a global process of integration in the world now: countries of Europe, Asia unites with each other, their scientists and ecologists are cooperating to solve problems together. And Russia should participate in this process. In this case, for example, within the Kyoto Protocol the countries of the world have united together in order to make decisions about the environmental issue general for everyone. In itself the principal of its solving points out the appearance of the world consciousness, even not mystical, but quite definite. According to the Protocol each developed country ought to offset its environmental pollution. Never mind where it will be realized in Holland, in Africa or in Russia, because we have got the same ecosphere. Burning forests of Amur area deals with the problem of English smog. And vice versa reconstruction of Amursk CHP-1 will allow to breath deeply somewhere in Japan. Therefore, that people, who criticize severely the world globalization and require Russia to follow its own way, are wrong because there already has been no such a way. Integration is a historic tendency, which appears in these or those politic and economic solutions, but it has a historic necessity. Poletaev P.S., Khabarovsk This is a true translation of the original document in Russian Page 10
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Annex VI Translate the article summary at Russian Energy (issue No 22, July 2003.): About the participation in the Netherlands Emission Reduction Unit Procurement Tender Two projects, prepared by Energy Carbon Fund on behalf of JSC Buryatenergo and JSC Khabarovskenergo and supported by RAO UESR, have been passed successfully the Selection phase of the Netherlands Emission Reduction Unit Procurement Tender (ERUPT 3). The projects are to be submitted the Contract Awarding phase of this tender. Page 12