CLEAN DEVELOPMENT MECHANISM PROJECT DESIGN DOCUMENT FORM (CDM-PDD) Version 03 - in effect as of: 28 July 2006 CONTENTS. Annexes

CDM Executive Board page 1 CLEAN DEVELOPMENT MECHANISM PROJECT DESIGN DOCUMENT FORM (CDM-PDD) Version 03 - in effect as of: 28 July 2006 CONTENTS A. General description of project activity B. Application of a baseline and monitoring methodology C. Duration of the project activity / crediting period D. Environmental impacts E. Stakeholders comments Annexes Annex 1: Contact information on participants in the project activity Annex 2: Information regarding public funding Annex 3: Baseline information Annex 4: Monitoring plan

CDM Executive Board page 2 SECTION A. General description of project activity A.1 Title of the project activity: Fujian Nanridao 16.15MW Wind Power Project Version:3.0 Date: 16/05/2007 A.2. Description of the project activity: Fujian Nanridao 16.15MW Wind Power Project (hereafter referred as the proposed project) is a grid connected renewable energy project. The objective of the proposed project is to generate electricity from wind resources using advanced wind power generation technology and deliver to the East China Power Grid. The proposed project is located in Nanri island of Putian City, Fujian Province, Southeast of China. The proposed project proposes to install 19 sets of 850 kw wind turbines, for a total installed capacity of 16.15 MW. Nanri island where the proposed project is located has relative rich wind resources, it is estimated that the annual electricity supplied to the grid of the proposed project will be 42.875 GWh. As a result, 38476 tonnes of CO2 emission reduction will be generated annually. Being as an environmentally sound energy supply technology, wind power generation is a priority development area in China. The contributions of the proposed project are summarized as follows: Being located in a power grid dominated by thermal power plants, development of the proposed project will not only reduce GHG emissions but also mitigate local environmental pollution caused by air emissions from thermal power plants. The proposed project could be helpful to diversify power mix of East China Power Grid. The proposed project is located in the second largest island of Fujian Province. The electricity consumption is imported from the power grid of mainland. The implementation of the proposed project will be helpful to meet the energy demand, therefore, contribute to local economic development; Reducing the dependence on exhaustible fossil fuels for power generation; Creation of employment. A.3. >> Project participants: 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) China (host) Fujian Putian Nanri Houshanzai Wind Power Generation Co., Ltd. No United Kingdom EDF Trading Limited No A.4. Technical description of the project activity:

CDM Executive Board page 3 >> A.4.1. Location of the project activity: A.4.1.1. Host Party(ies): >> China A.4.1.2. Region/State/Province etc.: >> Fujian Province A.4.1.3. City/Town/Community etc: >> Nanri Town, Xiuyu District, Putian City A.4.1.4. Detail of physical location, including information allowing the unique identification of this project activity (maximum one page): >> The proposed project is located in Nanri island of Putian City, Fujian Province of China, its geographical coordinates are north latitude 25º and east longitude 119º. The detailed location of the proposed project is shown in Figure 1. A.4.2. Category(ies) of project activity: Figure 1. Location of the proposed project

CDM Executive Board page 4 This category would fall within sectoral scope 1: energy industries. A.4.3. Technology to be employed by the project activity: The proposed project is located in coastal area of Southeast China. The wind resource of the proposed project site is very rich. The average wind speed in the height of 40m is 7.56m/s and the intensity of wind power is 515W/m 2. The wind direction is relative stable in the whole year. According to the condition of this wind farm, 19 sets of Gamesa G52 wind turbine with nominal capacity of 850 kw have been installed for the proposed project. Each turbine will be connected to local power grid with voltage of 35kV by a 690V-to-35kV transformer. A single circuit 35kV line will link into the existing Nanri substation from the wind farm. Through the 35kV sea cable from Nanri to Daitou, the generation of the project will be finally delivered to East China Power Grid. The wind turbines and transmission facility could be monitored and controlled either by onsite central control room or by control room of Local Dispatch Center remotely. Gamesa Eólica is one of the biggest manufacturers and suppliers of technologically advanced products installations and services in the renewable energy sectors. The main characteristics of Gamesa Eólica s wind turbines are their robustness, adaptability, reliability and maximum performance on all types of sites and in all types of winds. Due to its advantage on fully utilizing wind resources and improving efficiency, Gamesa52-850kW has been adopted worldwide. At the same time, Gamesa Eólica has a long experience in developing and operating wind farms. Hereby, the development of the project will contribute to promoting the transfer of technology during the construction and training of technicians for manufacturing, operation and maintenance of the wind power technology. Technical Characteristics of Wind Turbines for the proposed project Rotor 850 kw Type 3-bladed, horizontal axis, upwind Rotor Diameter 52 m Swept Area 2124 m 2 RPM 30.8/14.6 RPM Cut in-cut-out wind 4 / 25 m/s Nominal Output at velocity 14 m/s Design conditions in terms of velocity 70 m/s (IEC) Lifetime of turbine 20 years Blades Blade Length 25.3 m Material Epoxy reinforced glass fibre Generator Nominal Power 850 kw Type Doubly fed machine, oil pump with oil cooler Synchronous speed 1620 r.p.m Towers Type Tubular (cone-shaped) Hub heights 65 m ( Data sources from: http://www.gamesa.es/gamesa/eng/html /cont_e_g_52.html/gamesa G52-850kW general specification. pdf )

CDM Executive Board page 5 A.4.4 Estimated amount of emission reductions over the chosen crediting period: A renewable crediting period is selected for the proposed project activity. A reduction of approximately 269332tCO 2 e is forecast for the first 7-year crediting period in the table below. Years Annual estimation of emission reductions in tonnes of CO 2 e 2007* 12825 2008 38476 2009 38476 2010 38476 2011 38476 2012 38476 2013 38476 2014* 25651 Total estimated reductions 269332 (tonnes of CO 2 e) Total number of crediting years 7 Annual average over the crediting 38476 period of estimated reductions (tonnes of CO 2 e) *The starting date of the first crediting period is at September 1 th, 2007, the finishing date is at August 31 th, 2014. A.4.5. Public funding of the project activity: No public funds from Annex I countries is involved in the proposed project.

CDM Executive Board page 6 SECTION B. Application of a baseline and monitoring methodology B.1. Title and reference of the approved baseline methodology applied to the project activity: >> Baseline methodology: ACM0002(Version 6): Consolidated baseline methodology for grid-connected electricity generation from renewable sources. Tool for the Demonstration and Assessment of Additionality (version 03). Monitoring methodology: Approved consolidated monitoring methodology ACM0002 (Version 6): Consolidated monitoring methodology for zero-emissions grid-connected electricity generation from renewable sources. Reference: UNFCCC website: http://cdm.unfccc.int/methodologies/pamethodologies/approved.html B.2 Justification of the choice of the methodology and why it is applicable to the project activity: The proposed project can meet the applicability criteria of the baseline methodology (ACM0002), therefore, the methodology is applicable to the proposed project. The proposed project is a grid-connected zero-emission renewable power generation activity from wind source; The proposed project is not an activity that involves switching from fossil fuels to renewable energy at the proposed project site. The power grid (the East China Power Grid) which the proposed project is to be connected to is clearly identified and information on the characteristics of this grid is publicly available. The methodology will be used in conjunction with the approved consolidated monitoring methodology ACM0002 (Consolidated monitoring methodology for grid-connected electricity generation from renewable sources). The latest version of ACM0002 (version 6, effective from 19 May 2006) has been applied. B.3. Description of how the sources and gases included in the project boundary For this project, the sources of the greenhouse gases may mainly be the fired power plants in the East China Power Grid, in which the greenhouse gases mainly consist of CO2 and others gases, such as CH4 and N2O. However, the proposed project is a grid-connected zero-emission wind power without the emission of GHGs. Baseline Source Gas Included? Justification / Explanation Power plants CO2 Yes Major emission sources connected to CH4 Excluded for simplification. This is No the East China conservative.

CDM Executive Board page 7 Project Activity power grid On-site fuel combustion to the project activity N2O Excluded for simplification. This is No conservative. CO2 No No emission CH4 No No emission N2O No No emission According to the methodology (ACM0002) (version 6), the relevant grid definition should be based on the following considerations: (a) Use the delineation of grid boundaries as provided by the DNA of the host country if available; or (b) Use, Where DNA guidance is not available, the following definition of boundary: In large countries with layered dispatch systems (e.g. state/provincial/regional/national) the regional grid definition should be used. A state/provincial grid definition may indeed in many cases be too narrow given significant electricity trade among states/provinces that might be affected, directly or indirectly, by a CDM project activity; In other countries, the national (or other largest) grid definition should be used by default. According to above requirements, a project electricity system is defined by the spatial extent of the power plants that can be dispatched without significant transmission constraints. The proposed project delivers its electricity generated to East China Power Grid. Therefore, East China Power Grid is defined as the project boundary. East China Power Grid includes Shanghai, Jiangsu, Zhejiang, Anhui and Fujian. B.4. Description of how the baseline scenario is identified and description of the identified baseline scenario: Electricity delivered to the grid by the project would have otherwise been generated by the operation of grid-connected power plants and by the addition of new generation sources, as reflected in the combined margin (CM) calculations described in the Project Document Design. To provide the same output or services comparable with the proposed CDM project activity, these alternatives are to include: a) The thermal power plant with the same capacity or the same annual electricity output as the proposed project. b) The proposed project not undertaken as a CDM project activity but as a commercial project. c) The hydro power plant, solar PV power plant with the same capacity or the same annual electricity output as the proposed project. d) The East China Power Grid as the provider for the same capacity and electricity output as the proposed project. The alternative b) is unrealistic and should be eliminated from the following consideration because the investment analysis in Step 2 of section B.5 will show the proposed project not undertaken as a CDM project and without CERs income is lack of the attraction for the potential investors. The alternative c) is also unrealistic and should be eliminated from the following consideration: first, the hydro power is unrealistic because of the lack of exploitable hydro recourses in the proposed project site. According to the feasible study of the proposed project, Nanri Town, the proposed project

CDM Executive Board page 8 site, is an island with plain field. The exploitable hydro resource in Putian is very limited [1]. Secondly, the technology of Solar PV has not been well developed. Meanwhile the solar resource is relatively limited [2] in the place where the proposed project located. Otherwise the owner of the proposed project is dedicated to wind power development in China. Hence, the alternative c) is unrealistic too. The applicable legal and regulatory requirement for the proposed project include laws, central government regulations, local regulations, departmental rules and disciplines related to electricity and environment protection. The related laws and regulations can be found and downloaded on the website of State Electricity Regulatory Commission (SERC) and National Development and Reform Commission (NDRC): http://www.serc.gov.cn/opencms/export/serc/laws/index.html and http://nyj.ndrc.gov.cn. According to the applicable laws and regulations, the alternative a) should be eliminated from the following consideration because it does not comply with the national regulation for controlling small scale thermal power plant. To provide the same output as the proposed project, the alternative thermal power plant will has the capacity less than 50 MW then will be categorized as the small scale thermal power plant and should be shut down according to the regulations from NDRC. According to this regulation, the thermal power plant under 50 MW should be shut down and the construction of thermal power plant under 135 MW will be forbidden within the grid connected area. In conclusion, the alternative d) is the only realistic, credible alternative which is in compliance with all applicable legal and regulations, which is considered as the baseline scenario of the proposed project. B.5. Description of how the anthropogenic emissions of GHG by sources are reduced below those that would have occurred in the absence of the registered CDM project activity (assessment and demonstration of additionality): The following steps are used to demonstrate the additionality of the proposed project according to Tools for the demonstration and assessment of additionality (version 03) agreed by Executive Board and requested by the baseline methodology (ACM0002). Step1. Identification of alternatives to the project activity consistent with current laws and regulations. The objective of this step is to identify realistic and credible alternatives to the proposed project that can be the baseline scenario through the following sub-steps: Sub-step 1a. Define alternatives to the project activity. To provide the same output or services comparable with the proposed CDM project activity, these alternatives are to include: a) The thermal power plant with the same capacity or the same annual electricity output as the proposed project. b) The proposed project not undertaken as a CDM project activity but as a commercial project. 1 http://www.agro-labs.ac.cn/21c/jpg/2-1-5.jpg 2 http://cwera.cma.gov.cn/upload/b_3_left_02.jpg

CDM Executive Board page 9 c) The hydro power plant, solar PV power plant with the same capacity or the same annual electricity output as the proposed project. d) The East China Power Grid as the provider for the same capacity and electricity output as the proposed project. The alternative b) is unrealistic and should be eliminated from the following consideration because the investment analysis in Step 2 will show the proposed project not undertaken as a CDM project and without CERs income is lack of the attraction for the potential investors. The alternative c) is also unrealistic and should be eliminated from the following consideration: firstly, the hydro power is unrealistic because of the lack of exploitable hydro recourses in the proposed project site. According to the feasible study of the proposed project, Nanri Town, the proposed project site, is an island with plain field. The exploitable hydro resource in Putian is very limited. Secondly, the technology of Solar PV has not been well developed. Meanwhile the solar resource is relatively limited in the place where the proposed project located. Otherwise the owner of the proposed project is dedicated to wind power development in China. Hence, the alternative c) is unrealistic too. To summarize, the realistic and creditable alternatives that can provide the same output or services as the proposed project are a) and d). Step1b. Consistency with mandatory laws and regulations. The applicable legal and regulatory requirement for the proposed project include laws, central government regulations, local regulations, departmental rules and disciplines related to electricity and environment protection. The related laws and regulations can be found and downloaded on the website of State Electricity Regulatory Commission (SERC) and National Development and Reform Commission (NDRC): http://www.serc.gov.cn/opencms/export/serc/laws/index.html and http://nyj.ndrc.gov.cn. According to the applicable laws and regulations, the alternative a) should be eliminated from the following consideration because it does not comply with the national regulation for controlling small scale thermal power plant. To provide the same output as the proposed project, the alternative thermal power plant will has the capacity less than 50 MW then will be categorized as the small scale thermal power plant and should be shut down according to the regulations from NDRC. According to this regulation, the thermal power plant under 50 MW should be shut down and the construction of thermal power plant under 135 MW will be forbidden within the grid connected area. In conclusion, the alternative d) is the only realistic, credible alternative which is in compliance with all applicable legal and regulations, which is considered as the baseline scenario of the proposed project. Step2. Investment analysis. This step will determine whether the proposed project is the economically or financially less attractive than other alternatives without the revenue from the sale of CERs. Sub-step 2a. Determine appropriate analysis method.

CDM Executive Board page 10 Three options can be applied for the investment analysis: the simple cost analysis, the investment comparison analysis and the benchmark analysis. The simple cost analysis is not applicable for the proposed project because the project activity will produce economic benefit (from electricity sale) other than CDM related income. The investment comparison analysis is also not applicable for the proposed project because the baseline scenario, providing the same capacity or electricity output by the East China Power Grid, is not a project. To conclude, the benchmark analysis will be used to identify whether the financial indicators (such as IRR or NPV) of the proposed project is better than relevant benchmark value. Sub-step 2b Apply benchmark analysis. According to the Interim Rules on Economic Assessment of Electrical Engineering Retrofit Projects 3, a project will be financially acceptable when the Financial Internal Return Rate (FIRR) is better than 8% for investments in hydropower plants, fossil fuel fired plants and wind farm projects. The FIRR of the proposed project is calculated and compared as follows. Sub-step 2c. Calculation and comparison of financial indicators. Table 1 Main parameters for calculation of financial indicators Items Unit Amount 1 Capacity MW 16.15 2 Total Investment Million RMB 146.59 3 Annually output GWh/year 42.875 4 Value Added Tax % 8.5 (VAT) 5 Electricity Tariff RMB/kWh 0.58 (Including VAT) 6 Expected CERs Price EUR/tCO 2 10.21 7 Project life time Year 20 Source: Items (1-4) and item 7 are from the feasibility study report of the proposed project. Item 5 is from the approval of Fujian Province Pricing Bureau. Item 6 is from the agreement with EDF. The financial indicators (FIRR) with and without income from selling CERs are listed in the following table. Without income from selling CERs, the FIRR of the proposed project is lower than the benchmark FIRR and the proposed project is financially unacceptable because of its low profitability. While considering such income, the financial acceptance will be changed, the FIRR of the proposed project is better than the benchmark then the proposed project is financially acceptable. Table 2 Comparison of financial indicators with and without income from CERs Items Unit Without income from CERs Benchmark With income from CERs Electricity Tariff RMB/kWh 0.58 0.58 0.58 3 State Power Corporation of China. Interim Rules on Economic Assessment of Electrical Engineering Retrofit Projects. Beijing: China Electric Power Press, 2003

CDM Executive Board page 11 (Including VAT) FIRR % 6.87% 8 9.08% Sub-step 2d. Sensitivity analysis. The objective of this sub step is to show the conclusion regarding the financial attractiveness is robust to reasonable variations of the critical assumptions. Three factors are considered in following sensitivity analysis: 1) Total investment. 2) Annual operation and maintenance cost. 3) Expected power tariff. Assuming the above three factors vary in the range of -10%-+10%, the FIRR of the proposed project (without income from selling CERs) varies to different extent, as shown in Figure 3. The total investment is the most important factor affecting the financial attractiveness of the proposed project. In the case that total investment decreases by about 7.8%, the FIRR of the proposed project begins to exceed the benchmark. Since most of the total investment is used to buy wind turbines, which are totally exported from Spain and whose price is rather stable, it is very difficult to lower the total investment of the proposed project. And the wind farm construction period is finished, the investment is all commissioned. So the total investment is not likely to decrease by 7.8%. Hence within the reasonable range of the total investment, the proposed project is always lack of financial attractiveness. The next important factor for financial attractiveness is the expected power tariff. In the case that expected power tariff increases by about 8%, the FIRR of the proposed project begins to exceed the benchmark. Considering the power tariff is approved by Fujian Province Pricing Bureau, the probability that expected power tariff is 8% higher than the estimated value is very small. The impact of the annual O&M cost is the slightest, the FIRR of the proposed project begins to exceed the benchmark when the annual O&M cost decreases by more than 10%. Therefore, the proposed project is always lack of financial attractiveness within the reasonable range of annual O&M cost. Sensitivity Analysis 8.50% 8.00% 7.50% IRR 7.00% 6.50% 6.00% 5.50% 5.00% -10% 0 10% Rate of Change Total investment Expected power tariff Annual O&M cost Figure 3 Sensitivity analysis of the Project

CDM Executive Board page 12 To conclude, under the reasonable variations in the critical assumptions, the conclusion regarding the financial additionality is robust and supported by sensitivity analysis. Step 3. Barrier analysis. The objective of this step is to identify barriers that prevent the implementation of this type of proposed project activity but do not prevent the implementation of at least one of the alternatives identified in Step 1. Sub-step 3a Identify barriers that would prevent the implementation of the proposed project activity. The objective of this sub-step is to illustrate that there are barriers existing which would prevent the implementation of the proposed project from being carried out if the proposed project was not registered as a CDM project. The project is located in an island; its site is only less than 500 meters to the sea. The special geographic conditions make this project faced several serious barriers during its operation period, which include: Transformer corrosion caused by high salt atmosphere environment Bad weather condition The project site is often attacked by tropical storms in summer. The cable direct buried in the ground always eroded by the high intensive rainstorm, which need frequent maintenance, as a consequence, greatly increase the maintenance cost of the project. Sub-step 3b. Show that the identified barriers would not prevent the implementation of at least one of the alternatives (except the proposed project activity): As discussed in step 1, to provide the same output or services comparable with the proposed CDM project activity, these alternatives are to include: a) The thermal power plant with the same capacity or the same annual electricity output as the proposed project; b) The proposed project not undertaken as a CDM project activity but as a commercial project; c) The hydro power plant, solar PV power plant with the same capacity or the same annual electricity output as the proposed project; d) Providing the same capacity and electricity output as the proposed project by the East China Power Grid. According to the analysis in B5, the only realistic and credible alternative is d). In the case that the East China Power Grid is considered as a provider for same capacity and output, the barriers mentioned above would not prevent it from implementation. Step 4. Common practice analysis Sub-step 4a. Analyze other activities similar to the proposed project activity:

CDM Executive Board page 13 The existing wind farms located in East China are listed in the following table: Table 3 Wind Farms in the east China Power Grid Project Title Commissioning Capacity On-grid Tariff Note Date (MW) (RMB Yuan/kWh, incl.vat) Zhejiang Cangnan 1998.9 13.25 MW 1.2 Demonstration Wind Farm Zhejiang Linhai Kuocangshan Wind Farm Shanghai Chongming Nanhui wind Farm Fujian Dongshan Wujiaowan wind Farm Datang Zhangpuliuao Wind Farm project 1997.12 19.8MW 1.2 Demonstration project 2004.12 20MW 0.773 Demonstration project Under construction Under construction 30MW 0.5991 Applying for being a CDM project 30.6MW 0.5382 Applying for being a CDM project Sources: http://www.cwea.org.cn/upload/200612391640820.doc http://www.newenergy.org.cn/html/2004-12/20041605.html, http://www.dnv.com/certification/climatechange/projects/projectlist.asp?country=china Sub-step 4b. Discuss any similar options that are occurring: The existing wind farm projects do not call into question the claim that the proposed project is financially unattractive as discussed in Step 2 because there are essential distinctions between them. Before 2002, power grid and power generation did not separate, and thus had no restrictions in power grid connection. They enjoyed higher price than the proposed project. After the price cap regulation for wind power electricity tariff, such high tariff is impossible for wind farm developers. Most of the projects are demonstration projects and therefore enjoyed favourable treatments which are not be available for the proposed project. Moreover, since there is serious investment barrier for the proposed project, the CDM has been considered in the early evaluation period. The other projects in the list are seeking support by applying as CDM projects for they are financially unattractive and face investment, technological and tariff barriers as well. To conclude, there are essential distinctions between the proposed project and existing similar projects. The existence of these projects in Table 3 does not contradict the claim that the proposed project activity is financially unattractive. As described above, the proposed project activity passed all criteria of Tool for the demonstration and assessment of additionality (version 03). In conclusion, the proposed project is additional and not the baseline scenario.

CDM Executive Board page 14 B.6. Emission reductions: B.6.1. Explanation of methodological choices: By replacing electricity generated by fossil fuel fired power plant connected into the East China Power Grid, the proposed project will achieve CO 2 emission reduction consequently. In baseline scenario, the electricity would be otherwise generated by the operation of grid-connected power plants or by the addition of new generation sources. The spatial extent of the project boundary includes the project site and all power plants connected physically to the electricity system that the CDM project power plant is connected to. The project electricity system of the proposed project is defined as the East China Power Grid, and the connected electricity system is defined as the Central China Power Grid. There is electricity import from Central China Power Grid to East China Power Grid, i.e., 78.83GWh, 137.56GWh, and 269.3385GWh in 2002, 2003, and 2004 respectively (China Electric Power Yearbooks 2000-2002, 2004, and 2005). To determine baseline scenario emissions, firstly emission factors of Operating Margin ( EF OMy, ) and Build Margin ( EF BMy, ) were calculated based on the history data of the East China Power Grid, which include the installed capacity, electricity generation and different types of fuel consumptions of all the power plants connected into the East China Power Grid. Secondly, the baseline emission factor ( EF ) was calculated as a combined margin(cm) of the Operating Margin (OM) and Build Margin (BM) emission factors as described in following three steps. All the calculation is in compliance with requirement of the baseline methodology (ACM0002), as described in detail by the following steps. Step 1: Calculation the Operating Margin emission factor ( EF OMy, ) Calculation of OM emission factor should be based on one of the following four methods: (a) Simple OM, or (b) Simple adjusted OM, or (c) Dispatch Data Analysis OM, or (d) Average OM. The justifications of the choice of method to calculate OM emission factor are as follows. Method (c): If the dispatch data is available, method (c) should be the first methodological choice. This method requires the dispatch order of each power plant and the dispatched electricity generation of all the power plants in the power grid during every operation hour period. Since the dispatch data, power plants operation data are considered as confidential materials and only for internal usage not available publicly. Thus, method (c) is not applicable for the proposed project. Method (b): Method (b) requires the annual load duration curve of the power grid and the load data of every hour data during the whole year on the basis of the time order. As mentioned above, the dispatch data and detailed load curve data were not available publicly. Therefore, method (b) is not applicable for the proposed project as well. Method (d): Method (d) will only be used when (1) low-cost/must run resources constitute more than 50% of total grid generation and detailed data to apply method (b) is not available, and (2) where detailed data to apply option (c) above is unavailable. From 2000 to 2004, the low-cost/ must run y

CDM Executive Board page 15 resources constitute 9%, 11%, 12%, 11%, and 9.7%of total generation of East China Power Grid, respectively. (China Electric Power Yearbooks 2000-2005). Hence method (d) is not applicable for the proposed project. Method (a): Method (a) can only be used where low-cost/must run resources constitute less than 50% of total grid generation in: (1) average of the five most recent years, or (2) based on long-term normals for hydroelectricity production. Low operating cost and must run resources typically include hydro, geothermal, wind, low-cost biomass, nuclear and solar generation. If coal is obviously used as must-run, it should also be included in this list, i.e. excluded from the set of plants. From 2000 to 2004, the lowcost/ must run resources constitute 9%, 11%, 12%, 11%, and 9.7% of total generation of East China Power Grid, respectively. (China Electric Power Yearbooks 2000-2005). Therefore, method (a) is applicable for the proposed project. In conclusion, method (a) is the only reasonable and feasible method among the four methods for calculating the Operating Margin emission factor ( EF OMy, ) of the East China Power Grid. According to the ACM0002, the Simple OM emission factor ( EF OMsimpley,, ) is calculated as the generation-weighted average emissions per electricity unit (tco 2 /MWh) of all generating sources serving the system, not including low-operating cost and must-run power plants, the detailed formulas are as following: Fi, jy, COEFi, j i, j EFOMsimpley,, = (1) GEN j jy, where: F is the amount of fuel i (in a mass or volume unit) consumed by relevant power sources j in i, jy, year(s) y, j refers to the power sources delivering electricity to the grid, not including low-operating cost and must-run power plants, and including imports to the grid 4, COEF is the CO 2 emission coefficient of fuel i (tco 2 / mass or volume unit of the fuel), taking i, jy, into account the carbon content of the fuels used by relevant power sources j and the percent oxidation of the fule in year(s) y, and GEN jy, is the electricity (MWh) delivered to the grid by sources j. The CO 2 emission coefficient COEF i is obtained as COEF = NCV EF OXID (2) i i CO 2, i i where: NCV is the net calorific value (energy content) per mass or volume unit of a fuel i, (TJ/ mass or i volume unit), OXID is the oxidation factor of the fuel i (see page 1.29 in the 1996 Revised IPCC Guidelines for i default values), 4 As described above, an import from a connected electricity system should be considered as one power source j.

CDM Executive Board page 16 EF is the CO CO 2, i 2 emission factor per unit of energy of the fuel i (tco2e/tj). Regarding parameter selection, local values of NCV i and EF should be used where available. If no CO 2, i such values are available, IPCC world-wide default values are preferable. The Net Calorific Value ( NCV i ) of each type of fossil fuel used in the calculation comes from China Energy Statistic Yearbooks. Emission factors ( EF )of each type of fossil fuel come from Revised 1996 IPCC CO 2, i Guidelines for National Greenhouse Gas Inventories: Workbook, Chapter 1, P1.6, Table 1-2. For the value ofoxid, it is form Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories: i Workbook, Chapter 1, P1.8, Table 1-4. The simple OM emission factor can be calculated using either of the two following data vintages for years(s) y : (1) A 3-year average based on the most recent statistics available at the time of PDD submission, or (2) The year in which project generation occurs, if EFOMy, is updated based on ex post monitoring. The option (1), a 3-year generation weighted average based on the most recent statistics available at the time of PDD submission, is adopted for calculating the operation margin emission factor ( EF OMy, ). The data of installed capacity, electricity generation and fuel consumptions are all from China Energy Statistical Yearbooks and China Power Electric Power Yearbooks. The import electricity to East China Power Grid is from two sources: Central China Power Grid and 6*350MW coal fired power plants in Yangcheng, Shanxi Province. According to the baseline methodology (ACM0002), the average emission rate of Central China Power Grid is calculated as the emission factor of the electricity imported from CCPG, while the average emission factor of 300MW coal fired power plant is adopted as emission factor of electricity imported from Yangcheng (see Annex 3 for detailed information). Based on the calculation results, the Operation Margin emission factor ( EF OMy, ) of East China Power Grid is: 0.9411 tco2/mwh. The detailed calculations and data are listed in the annex 3. Step2: Calculation the Build Margin emission factor ( EF OMy, ) According to the ACM0002, the baseline Build Margin emission factor was calculated using the following formula (3). Fimy,, COEFimy,, im, EFBMy, = (3) GEN m my, where: F i,m,y is the amount of fuel i (in a mass or volume unit) consumed by m power plants in year(s) y, m refers to the power plants included in the sample group determined by the following steps. COEF i,m,y is the CO 2 emission coefficient of fuel i (tco 2 / mass or volume unit of the fuel), taking into account the carbon content of the fuels used by m power plants and the percent oxidation of the fuel in year(s) y, GEN m,y is the electricity (MWh) delivered to the grid by m power plants.

CDM Executive Board page 17 According to the baselinle methodology (ACM0002), one of the following two options shall be selected to identify sample group for calculating Build Margin emission factor. Option 1. Calculate the Build Margin emission factor EF BMy, ex ante based on the most recent information available on plants already built for sample m at the time of PDD submission. The sample group m consists of either The five power plants that have been built most recently, or The power plants capacity additions in the electricity system that comprise 20% of the system generation (in MWh) and that have been built most recently. Project participants should use from these two options that sample group that comprise the larger annual generation. Option 2. For the first crediting period, the Build Margin emission factor EF BMy, must be updated annually ex post for the year in which actual project generation and associated emission reductions occur. For subsequent crediting periods, EF BMy, should be calculated ex-ante, as described in option 1 above. The sample group m consisted of either The five power plants that have been built most recently, or The power plants capacity additions in the electricity system that comprise 20% of the system generation (in MWh) and that have been built most recently. Project participants should use from these two options that sample group that comprises the larger annual generation. Power plant capacity additions registered as CDM project activities should be excluded from the sample group m. For the proposed project, Option 1 was adopted for calculating the Build Margin emission factor. However, no matter which options mentioned above was adopted for the proposed project, the same issue on data availability must be addressed. Currently, it is very difficulty to get the capacity margin data of power plants in China, since these data as well as generation and fuel consumption data of each power plant are regarded as commercial secrets or only for internal usage. According to the guidance from the CDM Executive Board for a deviation of the baseline methodology of AM0005, which had combined into the baseline methodology of ACM0002, the following deviation was adopted to calculate the Build Margin emission factor. (http://cdm.unfccc.int/usermanagement/filestorage/am_clar_qejwjef3cfbp1ozak6v5yxpq KK7WYJ): 1) Use of capacity additions for estimating the build margin emission factor for grid electricity. 2) Use of weights estimated using installed capacity in place of annual electricity generation. Use the efficiency level of the best technology commercially available in the provincial/regional or national grid of China, as a conservative proxy, for each fuel type in estimating the fuel consumption to estimate the build margin (BM). According to the guidance from EB, the following deviation was adopted to calculate the Build Margin emission factor. 1. Due to breakdown data by power plants are not while the aggregate data by different types of fuels are available, therefore, the m sample group will consist of capacity addition by power sources with

CDM Executive Board page 18 same fuel instead of by power plants. For the proposed project the m sample group will consist of coal fired capacity addition, hydropower capacity addition and other capacity addition; 2. Assuming that all the power plants with same fuel type have equal annual operation hours, the starting year t 0 could be identified which fulfil the following constraint: t t i, 20% 0 i CAP CAP, i i t (4) Where, t is the recent year of which the latest data is available; CAP i,t-t0 is the capacity addition of type i from year t 0 to year t; CAP i,t is the installed capacity of type i in year t; The capacity addition belonging to m sample group thus could be identified. For the proposed project, the most recent year of which data is available is 2004, while t 0 =2002, the total capacity addition during 2002 to 2004 consisting of 18303.9MW of fossil fired capacity, 1252.7 MW of hydropower capacity and 1378MW of nuclear power capacity, 10.4 MW of other capacity. The total capacity addition during 2002 to 2004 accounts for 21.60% of total installed capacity in 2004. 3. To be conservative, the best commercially available technology for coal fired power generation is identified as domestically produced 600MW sub-critical power unit. The coal consumption per kwh electricity supplied to grid by domestically produced 600MW sub-critical power unit is estimated as 336.66 gce/kwh, equivalent to 36.53% as power supply efficiency 5. 4. In addition, there are two assumptions in this substitute calculation method: Zero emission factors were selected for hydropower capacity and other capacity; the average annual operational hours of non fuel-fired power plants are less than those of fuel-fired power plants. Then this proposed project uses a conservative alternative method (as the formula 5 described) to calculate EF BM,y, using the share of different type capacity in capacity addition as weight, the weight average of emission factors of different type capacity is calculated as the Build Margin emission factor EF BMy, of East China Power Grid. where: EF = EF CAP / CAP (5) BM, y thermal, adv thermal, addition total, addition EF thermal, adv is the emission factor of thermal power. However, as far as East China Grid is concerned, there are some oil and gas consumption, e.g., CO2 emission from the oil and gas in East China Grid accounts for 3.92% in total emission of the grid in 2004. 6 This oil and gas are not combusted directly for power generation, instead they are mostly for start-ups of boilers. So the sample selection of best technology commercially available for oil-fired and gas-fired power plant is infeasible. Due to the tiny share of oil and gas consumption, EF coal, adv is used instead of EF thermal, adv here. EF coal, adv is the emission factor of coal-fired power with Best Practiced Commercialized Technology; 5 http://cdm.ccchina.gov.cn/website/cdm/upfile/file1051.pdf 6 http://cdm.ccchina.gov.cn/website/cdm/upfile/file1051.pdf, page 14

CDM Executive Board page 19 CAP thermal, addition is the capacity addition of fossil fired power plant from 2002 to 2004; CAP total, addition is the total capacity addition from 2002 to 2004; Following the steps above, the Build Margin emission factor EF BMy, of the East China Power Grid is calculated to be: 0.79839tCO2/MWh. The detailed calculation and data were listed in the annex 3. As a simple and conservative method, the EF BM,y calculated above should be discounted by multiplying a coefficient(96%). The EF BM,y is revised as: 0.798398*96%=0.7665 tco2e/mwh. Step3: Calculation the baseline emission factor ( EF ) According to the baseline methodology (ACM0002), the baseline emission factor EF y is calculated as the weighted average of the Operating Margin emission factor ( EF OMy, ) and the Build Margin emission factor ( EF BMy, ),: EF = ω EF + ω EF (6) y OM OM, y BM BM, y where the weights ω OM and ω BM are 75% and 25% respectively by the default. The default weights are adopted for the proposed project, the baseline emission factor is: EF y =0.75*EF OM,y +0.25*EF BM,y =0.8974 tco2/mwh. y B.6.2. Data and parameters that are available at validation: F i,y Data / Parameter: Data unit: t/m 3 Description: Amount of fuel i consumed in year(s) y for generation Source of data used: China Energy Statistical Yearbook Value applied: See Annex 3 Justification of the choice Since the detailed fuel consumption data by power plants are not publicly of data or description of available, therefore the aggregated data by fuel types are used instead. measurement methods and procedures actually applied : Any comment: GEN i,y Data / Parameter: Data unit: MWh Description: Electricity (MWh) delivered to the grid excluding low operating cost/must run power plants in year y. Source of data used: China Electric Power Yearbook Value applied: See Annex 3 Justification of the choice Since the detailed generation data by power plants are not publicly available, of data or description of therefore the aggregated data by fuel types are used instead.

CDM Executive Board page 20 measurement methods and procedures actually applied : Any comment: Data / Parameter: NCV i Data unit: TJ/t(m 3 ) Description: Net calorific value (energy content) per mass or volume unit of fuel i Source of data used: China Energy Statistical Yearbook Value applied: See Annex 3 Justification of the choice of data or description of According to ACM0002, the national specific value shall be used preferentially. measurement methods and procedures actually applied : Any comment: Data / Parameter: OXID i Data unit: % Description: Oxidation factor of the fuel i Source of data used: IPCC1996 default value Value applied: See Annex 3 Justification of the choice of data or description of The country specific values of oxidation factors in China are not available. As such IPCC default values are used instead. measurement methods and procedures actually applied : Any comment: EF CO2,I Data / Parameter: Data unit: tco 2 /TJ Description: CO 2 emission factor per unit of energy of the fuel i Source of data used: The emission factor of Carbon comes from IPCC1996 as a default value, EF CO2,I could be calculated by multiplying it by 44 and dividing it by 12. Value applied: See Annex 3 Justification of the choice The country specific values of fuel CO 2 emission factor in China are not of data or description of available. As such IPCC default values are used instead. measurement methods and procedures actually applied : Any comment: Data / Parameter: Data unit: Description: EFCoal,Adv tco2/mwh CO 2 emission factor per unit of energy of the coal of best available technologies

CDM Executive Board page 21 in China. Source of data used: http://cdm.ccchina.gov.cn/website/cdm/upfile/file1051.pdf, page 4. Value applied: See Annex 3 Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment: According to EB guidance, the efficiency level of the best technology commercially available in the provincial/regional or national grid of China can be used as a conservative proxy for each fuel type in estimating the fuel consumption to estimate the build margin (BM). B.6.3 Ex-ante calculation of emission reductions: According to the baseline methodology ACM0002, the GHG emission of the proposed project within the project boundary is zero, i.e. PEy=0. According to the baseline methodology ACM0002, the leakage of the proposed project is not considered, i.e. Ly=0. Therefore, the proposed project activity emissions are zero, i.e. E.1+E.2=PEy+Ly=0. According to the descriptions and formulas in section B. 6.1, the combined baseline emission factor of the East China Power Grid is: EF y =0.8974 tco 2 / MWh. According to the Feasibility Study Report of the proposed project, the estimated annual electricity generation delivered to the power grid will be: EG y =42.875 GWh. The annual emissions of baseline scenario are: BE y =EG y EF y = 38476 tco 2 B.6.4 Summary of the ex-ante estimation of emission reductions: Year Ex ante estimation of emission reductions due to the project Estimation of Estimation of Estimation of Project activity leakage Emission baseline emission (tonnes of CO2 e) (tonnes CO2e) of Estimation of Emission reductions (tonnes of CO2 e) (tonnes of CO2e) 2007* 0 12825 0 12825 2008 0 38476 0 38476 2009 0 38476 0 38476 2010 0 38476 0 38476 2011 0 38476 0 38476 2012 0 38476 0 38476 2013 0 38476 0 38476 2014* 0 25651 0 25651

CDM Executive Board page 22 Total (t CO2e) 0 269332 0 269332 *The starting date of the first crediting period is at September 1 th, 2007, the finishing date is at August 31 th, 2014. B.7 Application of the monitoring methodology and description of the monitoring plan: B.7.1 Data and parameters monitored: Data / Parameter: Data unit: Description: Source of data to be used: Value of data applied for the purpose of calculating expected emission reductions in section B.5 Description of measurement methods and procedures to be applied: QA/QC procedures to be applied: Any comment: EGy MWh Electricity delivered to the grid by the proposed project Electricity meter reading at Daitou transformer station and at Nanri Island transformer station. 42875 The metering equipment will be properly configured and checked annually according to the requirement from Technical administrative code of electric energy metering (DL/T448-2000). Three meters are installed. One is at Daitou transformer station, and the others are at Nanri Island transformer station. They measure the total electricity supplied to the grid Through the electronic multifunctional electricity meter (with an accuracy degree of 0.5S), the electricity supplied to the grid is measured. The readings of electricity meter will be hourly measured and monthly recorded. Data will be archived for 2 years following the end of the crediting period by means of electronic and paper backup. Electricity sales invoices will also be obtained for double check. Electricity supplied by the project activity to the grid. Double check by receipt of sales. B.7.2 Description of the monitoring plan: This monitoring plan will be implemented by professional staff authorized by the owner of the proposed project, i.e. Fujian Putian Nanri Houshanzai Wind Power Generation Co., Ltd. The management structure is illustrated as follows:

CDM Executive Board page 23 B.8 Date of completion of the application of the baseline study and monitoring methodology and the name of the responsible person(s)/entity(ies) The baseline study of the proposed project was completed on 16/05/2007 by Global Climate Change Institute (GCCI) of Tsinghua University. The baseline study has received effective support from CDM Development Branch of China Fulin Wind Power Development Corporation led by Mr. Liulin. The persons involved in baseline study are listed as follows: Dr Xiaohua ZHANG, Global Climate Change Institute, Tsinghua University. Address: Room C501, Energy Science Building, Tsinghua University, 100084, Beijing, China Telphone: +8610-62772757 Email: zhang_xh@tsinghua.edu.cn Tianfeng FENG, China Fulin Windpower Development Corporation. Address: Room 1326, State Power Information & Communication Building, No.1 Baiguanglu Ertiao, Xuanwu District, Beijing 100761, China Telephone: +8610-83533615 Email: tffeng@163.com (Not the project participants listed in Annex 1)

CDM Executive Board page 24 SECTION C. Duration of the project activity / crediting period C.1 Duration of the project activity: C.1.1. Starting date of the project activity: >>01/01/2005.(Construction Day) C.1.2. Expected operational lifetime of the project activity: >>20years. C.2 Choice of the crediting period and related information: C.2.1. Renewable crediting period C.2.1.1. Starting date of the first crediting period: >>01/09/2007. C.2.1.2. Length of the first crediting period: >>7 years. C.2.2. Fixed crediting period: C.2.2.1. >> Not applicable C.2.2.2. >>Not applicable Starting date: Length:

CDM Executive Board page 25 SECTION D. Environmental impacts >> D.1. Documentation on the analysis of the environmental impacts, including transboundary impacts: The Environmental Assessment Report of the proposed project has been approved by the Environmental Protection Administration of Fujian Province. During the construction period of the proposed project, the waste water will be treated and used as irrigation water, which will be no impact on the surface water. After the completion of the construction, the surrounding area of permanent occupation of ground will be planted with vegetation; the temporary equipments will be taken away. The ground occupation will not have obvious impact on the local ecology impact. The major environmental impact of the proposed project during the operation period is noise impact. The noise source will be mainly from the running of the wind turbine. The assessment presents that the estimated noise level of the proposed project has little impacts on the nearby villages, which is even lower than the wind noise prior to wind farm construction. There will be a little amount of living waste water released during the operation period of the proposed project, which will be treated to meet the Class I of Standard of Emission of Waste Water (GB8978-96). Therefore, the waste water will have little impact on the surface water. There will be a little solid waste generated during the operation period, which be treated thus has no impacts on local environment. The proposed project is not located on migratory route of migrants and no national protected animals are found in the surrounding area, therefore the proposed project has no impacts on local ecology system. In conclusion, being as a typical type of clean renewable energy, the proposed project has no significant impacts on local environment and will greatly contribute to achievement of sustainable development objective and promote local environmental protection. D.2. If environmental impacts are considered significant by the project participants or the host Party, please provide conclusions and all references to support documentation of an environmental impact assessment undertaken in accordance with the procedures as required by the host Party: Not applicable, since the construction and operation of the proposed project have no significant environmental impacts.

CDM Executive Board page 26 SECTION E. Stakeholders comments >> E.1. Brief description how comments by local stakeholders have been invited and compiled: On April 2 nd, 2005, under the support of local government, the project owner successfully held stakeholder meetings at Nanri Island. Representatives participated the meetings, respectively from the local Development and Reform Bureau, the local Environmental Protection Bureau, the local Power Supply Corporation, and the nearby village where the proposed project is located. E.2. Summary of the comments received: Every stakeholder representative expressed the comments for the proposed project. No opposite comment was received. The summary of the comments is as follows: Comments from the local government: Wind power projects are environment friendly projects and are highly encouraged by China central government. Both the Development and Reform Commission of and Environmental Protection Administration of Putian City highly support the development of wind power projects. They hope the successful implementation of the proposed project will diversify local power mix, mitigate electricity shortage, and promote the development of local tourism and other tertiary industries. Comments from villager representatives: The project site is located on seashore are, and there are only a few residents and cropland more than two hundred metres from the site. Therefore, the construction of the wind power plant does not result in moving local residents or noise disturbance. The local villagers are satisfied with compensation by the project owner for occupation on part of land occupation. The local villagers also benefit from the infrastructure such as transportation improvement constructed for the proposed project. E.3. Report on how due account was taken of any comments received: Since there is no negative comment received, it s no need to make adjustment on design, construction and operation of the proposed project.

CDM Executive Board page 27 Annex 1 CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT Organization: Fujian Putian Nanri Houshanzai Wind Power Generation Co., Ltd. Street/P.O.Box: Building: No.51 East Meiyuan Road, Licheng District City: Putian State/Region: Fujian province Postfix/ZIP: 351100 Country: China Telephone: 86 594 2337009 FAX: 86 594 2337009 E-Mail: ptfdzqh@163.com URL: Represented by: Zou Qinghua Title: Salutation: Last Name: Zou Middle Name: First Name: Qinghua Department: Mobile: 13110565882 Direct FAX: 0594 2337009 Direct tel: 0594 2337009 Personal E-Mail: ptfdzqh@163.com

CDM Executive Board page 28 Organization: EDF Trading Limited Street/P.O.Box: 71 High Holborn Building: City: London State/Region: Postfix/ZIP: WC1V 6ED Country: United Kingdom Telephone: +44 (0)20 7061 4207 FAX: +44 (0)20 7061 5207 E-Mail: franck.bernard@edftrading.com URL: www.edftrading.com Represented by: Franck Bernard Title: Environmental Product Manager Salutation: Mr Last Name: Bernard Middle Name: First Name: Franck Department: Department of Environmental Product Mobile: +44 (0)7879 688 379 Direct FAX: +44 (0)20 7061 5207 Direct tel: +44 (0)20 7061 4207 Personal E-Mail: franck.bernard@edftrading.com

CDM Executive Board page 29 Annex 2 INFORMATION REGARDING PUBLIC FUNDING No public funding from Annex I countries is involved in the proposed project.

CDM Executive Board page 30 Annex 3 BASELINE INFORMATION The Annex 3 provides the basic data and calculation results for determining baseline scenario. 1. OM emission factor calculation of ECPG (East China Power Grid). Table A-1, A-2, and A-3 provide annual thermal power electricity generation in ECPG from 2002 to 2004. A-4, A-5, and A-6 provide the electricity generation in CCPG (Central China Power Grid) from 2002 to 2004.The main data sources come from China electric Power Yearbook 2000-2002, 2004 and 2005, the detailed reference pages are listed below the tables. Table A- 1 Annual thermal power electricity generation in ECPG in 2002 Province Electricity Electricity Self usage rate delivered to the generation grid (MWh) (%) (MWh) Shanghai 61648000 5.44 58294348.8 Jiangsu 116716000 6.09 109607995.6 Zhejiang 69287000 5.95 65164423.5 Anhui 45703000 6.36 42796289.2 Fujian 30850000 6.68 28789220 Total 304652277.1 Data source:china Electric Power Yearbook 2003,P584-585,P593. Table A- 2 Annual thermal power electricity generation in ECPG in 2003 Province Electricity Electricity Self usage rate delivered to the generation grid (MWh) (%) (MWh) Shanghai 69444000 5.14 65874578.4 Jiangsu 133277000 5.9 125413657 Zhejiang 83089000 5.31 78676974.1 Anhui 54156000 6.06 50874146.4 Fujian 42146000 5.07 40009197.8 Total 360848553.7 Data source:china Electric Power Yearbook 2004, P709. Table A- 3 Annual thermal power electricity generation in ECPG in 2004 This template shall not be altered. It shall be completed without modifying/adding headings or logo, format or font.

CDM Executive Board page 31 Electricity Electricity Province Self usage rate delivered to the generation grid (MWh) (%) (MWh) Shanghai 71127000 5.22 67414170.6 Jiangsu 163545000 5.93 153846781.5 Zhejiang 95255000 5.68 89844516 Anhui 59875000 6.03 56264537.5 Fujian 50490000 6.07 47425257 Total 414795262.6 Data source:china Electric Power Yearbook 2005, P472-474. This template shall not be altered. It shall be completed without modifying/adding headings or logo, format or font.

CDM Executive Board page 32 Table A-4 Annual electricity generation in CCPG in 2002 Province Thermal Thermal power Hydropower Self usage Self usage power electricity Hydropower electricity rate rate electricity delivered electricity delivered Total generation to the grid generation to the t grid (MWh) (%) (MWh) (MWh) (%) (MWh) Jiangxi 18648000 7.67 17217698 6151000 0.78 6103022.2 Henan 84734000 8.03 77929860 4859000 0.49 4835190.9 Hubei 34301000 7.73 31649533 27854000 0.26 27781579.6 Hunan 20058000 7.73 18507517 25329000 0.39 25230216.9 Chongqing 14727000 10.21 13223373 3748000 1.62 3687282.4 Sichuan 27879000 9.59 25205404 44499000 0.4 44321004 Total 183733385 111958296 295691681 Data source:china Electric Power Yearbook 2003, P591-P593. Table A-5 Annual electricity generation in CCPG in 2003 Thermal Hydropower Province Self usage electricity electricity electricity rate delivered delivered Total generation to the grid to the grid (MWh) (%) (MWh) (MWh) Jiangxi 27165000 6.43 25418291 3864000 Henan 95518000 7.68 88182218 5457000 Hubei 39532000 3.81 38025831 38775000 Hunan 29501000 4.58 28149854 24401000

CDM Executive Board page 33 Chongqing 16341000 8.97 14875212 3951000 Sichuan 32782000 4.41 31336314 50000000 Total 225987719 126448000 352435719.2 Data source:china Electric Power Yearbook 2004, P670, P709. Table A-6 Annual electricity generation in CCPG in 2004 Province Thermal Hydropower Other Thermal Self usage electricity Hydropower Self usage electricity electricity electricity rate delivered electricity rate delivered delivered generation to the grid generation to the grid to the grid Total (MWh) (%) (MWh) (MWh) (%) (MWh) Jiangxi 30127000 7.04 28006059 3890000 1.2 3843320 Henan 109352000 8.19 100396071 6884000 0.43 6854398.8 Hubei 43034000 6.58 40202363 69512000 0.12 69428585.6 Hunan 37186000 7.47 34408206 24236000 0.51 24112396.4 Chongqing 16520000 11.06 14692888 5670000 2.09 5551497 725000 Sichuan 34627000 9.41 31368599 58902000 0.39 58672282.2 Total 249074186 168462480 725000 418261666 Data source:china Electric Power Yearbook 2005, P472-474.

CDM Executive Board page 34 Table A-7, A-8, and A-9 provide the calculation of the average Emission factor of CCPG from 2002 to 2004. Table A-10, A-11, and A-12 provide the calculation of the Simple OM emission factor of the East China Power Grid from 2002 to 2004. The key parameters in OM calculation include the net caloric values (NCV), oxidation factors (OXID), and CO2 emission factor per unit of energy (EF co2 ) of various types of fuels, which were shown in the table below: NCVs, OXIDs, and EFco2s of various types of fuels Fuel NCV EF co2 (tc/tj) OXID Coal 20908 kj/kg 25.80 0.98 Washed coal 26344 kj/kg 25.80 0.98 Other Washed Coal 7 8363 kj/kg 25.80 0.98 Coke 28435 kj/kg 29.50 0.98 Crude oil 41816 kj/kg 20.00 0.99 Gasoline 43070 kj/kg 18.90 0.99 Kerosene 43070 kj/kg 19.60 0.99 Diesel 42652 kj/kg 20.20 0.99 Fuel oil 41816 kj/kg 21.10 0.99 Other petroleum products 8 38369 kj/kg 20.00 0.99 Natural gas 38931 kj/m3 15.30 0.995 Coke oven gas 9 16726 kj/m3 13.00 0.995 Other gas 10 5227 kj/m3 13.00 0.995 LPG 50179 kj/kg 17.20 0.995 Refinery gas 46055 kj/kg 18.20 0.995 Data sources: NCV are from China Energy Statistical Yearbook 2005, P365. EF co2 are from Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories: Workbook, Chapter 1, P1.6, Table 1-2. 7 Other washed coal includes middlings and slimes. The NCV value of middlings is adopted here, which is conservative because the NCV value of slimes is higher than that of middlings. 8 The NCV value of other petroleum products are not provided in China Energy Statistical Yearbooks. This Annex calculates it as 38369 kj/kg, i.e., 1.3108 tce/t, on the basis of Energy Balance Sheets (physical quantity) and conversion factor against SCE 9 The NCV value here adopts the lower limit of the NCV value range, i.e., 16726-17981 kj/m 3, for coke oven gas provided in China Energy Statistical Yearbook 2005, P 365. 10 The NCV value here adopts the lowest NCV value among those for gas by furnace, gas by heavy oil catalytic cracking, gas by heavy oil catalytic thermal cracking, gas by pressure gasification, and water coal gas, which are provided in China Energy Statistical Yearbook 2005, P 365. This template shall not be altered. It shall be completed without modifying/adding headings or logo, format or font.

CDM Executive Board page 35 OXID are from Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories: Workbook, Chapter 1, P1.8, Table 1-4. This template shall not be altered. It shall be completed without modifying/adding headings or logo, format or font.

CDM Executive Board page 36 Fuel types Unit Jiangxi Table A-7 The average emission rate of Central China Power Grid in 2002 Henan Hubei Hunan Chongqing Sichuan A B C D E F Sub-Total EF co2 OXID Net caloric value Data sources: China Energy Statistical Yearbook 2000-2002, P320-P323,P344-P347,P356-P359,P368-P371,P535. (tc/ TJ) (% ) (MJ/t,k m3) G=A+B+C +D+E+F H I J CO 2 emission (tco 2 e) K=G*H*I*J* 44/12/10000 (quantity quantity) K=G*H*I*J* 44/12/1000 (volume volume) Coal 10 4 t 1062.63 4679.02 1710 1113.78 398.57 1964.32 10928.32 25.8 98 20908 211827873.7 Washed coal 10 4 t 2.72 2.72 25.8 98 26344 66430.54781 Other Washed Coal 10 4 t 3.66 26.49 249.99 280.14 25.8 98 8363 2171973.055 Coke 10 4 t 1.15 1.15 29.5 98 28435 34663.35501 Coke oven gas Bcm 1.11 1.11 13 99.5 16726 88054.77967 Other gas Bcm 2.16 2.16 13 99.5 5227 53548.10604 Crude oil 10 4 t 0.67 1.17 0.81 2.65 20 99 41816 80449.8024 Diesel 10 4 t 1 1.34 1.08 2.19 0.51 0.51 6.63 20.2 99 42652 207353.2866 Fuel oil 10 4 t 0.33 0.16 0.34 0.69 1.51 3.03 21.1 99 41816 97045.23051 LPG 10 4 t 0.02 0.02 17.2 99.5 50179 629.7598311 Refinery gas 10 4 t 0.49 1.9 2.39 18.2 99.5 46055 73087.0759 Natural gas Bcm 1.75 1.75 15.3 99.5 38931 380294.067 Other oil product 10 4 t 0 20 99 38369 0 Other coked product 10 4 t 0 25.8 98 28435 0 Other energy 10 4 t 3.38 3.38 0 0 0 0 Total 215081402.8 Average emission factor tco2e/ MWh 0.727384

CDM Executive Board page 37 Fuel types unit Jiangxi Table A-8 The average emission rate of Central China Power Grid in 2003 Henan Hubei Hunan Chongqing Sichuan A B C D E F Data sources: China Energy Statistical Yearbook 2004, P198-P201,P206-P209,P210-P213,P214-P217,P302,P301. Sub- Total EF co2 OXID (tc/ TJ) (% ) Net caloric value (MJ/t,k m3) G=A+B+ C+D+E+ F H I J CO 2 emission (tco 2 e) K=G*H*I*J* 44/12/10000 (quantity quantity) K=G*H*I*J* 44/12/1000 (volume) Coal 10 4 t 1427.41 5504.94 2072.44 1646.47 769.47 2430.93 13851.66 25.8 98 20908 268492109.1 Washed coal 10 4 t 0 25.8 98 26344 0 Other Washed Coal 10 4 t 2.03 39.63 106.12 147.78 25.8 98 8363 1145763.469 Coke 10 4 t 1.22 1.22 29.5 98 28435 36773.29836 Coke oven gas Bcm 0.93 0.93 13 99.5 16726 73775.62621 Other gas Bcm 0 13 99.5 5227 0 Crude oil 10 4 t 0.5 0.24 1.2 1.94 20 99 41816 58895.32704 Diesel 10 4 t 0.52 2.54 0.69 1.21 0.77 5.73 20.2 99 42652 179205.7816 Fuel oil 10 4 t 0.42 0.25 2.17 0.54 0.28 1.2 4.86 21.1 99 41816 155656.7064 LPG 10 4 t 0 17.2 99.5 50179 0 Refinery gas 10 4 t 1.76 6.53 0.66 8.95 18.2 99.5 46055 273694.28 Natural gas Bcm 0.04 2.2 2.24 15.3 99.5 38931 486776.4058 Other oil product 10 4 t 0 20 99 38369 0 Other coked product 10 4 t 0 25.8 98 28435 0 Other energy 10 4 t 11.04 16.2 27.24 0 0 0 0 Total 270902650 Average emission tco2e/ factor MWh 0.76865833

CDM Executive Board page 38 Fuel types unit Jiangxi Table A-9 The average emission rate of Central China Power Grid in 2004 Henan Hubei Hunan Chongqin g Sichua n A B C D E F Total 339209149.9 Average emission tco2e/ factor MWh 0.81099746 Data sources: China Energy Statistical Yearbook 2005, P262-P273, P286-P293. Sub- Total EF co2 OXID (tc/ TJ) (% ) Net caloric value (MJ/t, m3) G=A+B+ C+D+E+F H I J CO 2 emission (tco 2 e) K=G*H*I*J*44/12 /10000 (quantity quantity) K=G*H*I*J*44/12 /1000 (volume volume) Coal 10 4 t 1863.8 6948.5 2510.5 2197.9 875.5 2747.9 17144.1 25.8 98 20908 332310753.2 Washed coal 10 4 t 2.34 2.34 25.8 98 26344 57149.80952 Other Washed Coal 10 4 t 48.93 104.22 89.72 242.87 25.8 98 8363 1883012.408 Coke 10 4 t 109.61 109.61 29.5 98 28435 3303869.863 Coke oven gas Bcm 1.68 0.34 2.02 13 99.5 16726 160243.8333 Other gas Bcm 2.61 2.61 13 99.5 5227 64703.96147 Crude oil 10 4 t 0.86 0.22 1.08 20 99 41816 32787.08928 Diesel 10 4 t 0.06 0.01 0.07 18.9 99 43070 2068.432443 Fuel oil 10 4 t 0.02 3.86 1.7 1.72 1.14 8.44 20.2 99 42652 263961.0466 LPG 10 4 t 1.09 0.19 9.55 1.38 0.48 1.68 14.37 21.1 99 41816 460244.212 Refinery gas 10 4 t 0 17.2 99.5 50179 0 Natural gas Bcm 3.52 2.27 5.79 18.2 99.5 46055 177060.3219 Other oil product 10 4 t 2.27 2.27 15.3 99.5 38931 493295.7327 Other coked product 10 4 t 0 20 99 38369 0 Other energy 10 4 t 0 25.8 98 28435 0 Coal 10 4 t 16.92 15.2 20.95 53.07 0 0 0 0

CDM Executive Board page 39 Table A-10 Simple OM emission factor of the East China Power Grid in 2002 Fuel types unit Shangha i Jiangsu Zhejiang Anhui Fujian Sub- Total EF co2 (tc/tj tc/tj) OXID Net caloric value (MJ/t,km3,tce MJ/t,km3,tce) CO2 emissions (tco2e tco2e) (tc/tj) (% ) (MJ/t,km3) J=G*H*I*F*44/12/ 10000(quantity ) A B C D E F=A+...+ E G H I J=G*H*I*F*44/12/ 1000 (volume ) Coal 10 4 t 2386 5674.69 2923.66 2025.05 1336.49 14345.89 25.8 98 20908 278071961.3 Washed coal 10 4 t 0 25.8 98 26344 0 Other Washed Coal 10 4 t 0 25.8 98 8363 0 Coke 10 4 t 0 29.5 98 28435 0 Coke oven gas bcm 2.23 0.02 2.25 13 99.5 16726 178489.4183 Other gas bcm 66.82 66.82 13 99.5 5227 1656520.577 Crude oil 10 4 t 0 20 99 41816 0 Gasoline 10 4 t 0.07 0.07 18.9 99 43070 2068.432443 Diesel 10 4 t 1.21 13.45 30 44.66 20.2 99 42652 1396741.747 Fuel oil 10 4 t 53.2 1.19 91.38 1.09 12.6 159.46 21.1 99 41816 5107205.431 LPG 10 4 t 0 17.2 99.5 50179 0 Refinery gas 10 4 t 0.84 0.84 18.2 99.5 46055 25687.50785 Natural gas bcm 0 15.3 99.5 38931 0 other oil 10 4 t 10 3.47 13.47 20 99 38369 3752188.922 other coke 10 4 t 0 25.8 98 28435 0 other energy 10 4 t 3 10.4 13.4 0 0 0 0 Total 290190863.3 Generation emission emission factor MWh (tco2e) tco2/mwh Thermal generation delivered to East China Power Grid 304652277.1 290190863.3 Imported from CCPG 7883000 5733968.21 0.72738402 Imported from Yangcheng Total 312535277.1 295924831 OM 0.946852574 Data sources: China Energy Statistical Yearbook 2000-2002,P220-P249,P535.China Electric Power Yearbook 2003.

CDM Executive Board page 40 Table A-11 Simple OM emission factor of the East China Power Grid in 2003 Fuel types unit Shangh ai Jiangsu Zhejia ng Anhui Fujia n Sub- Total EF co2 (tc/tj tc/tj) OXID Net caloric value (MJ/t,km3,tce MJ/t,km3,tce) CO2 emissions (tco2e CO2e) (tc/tj) (% ) (MJ/t,km3) J=G*H*I*F*44/12/1 0000(quantity) A B C D E F=A+B+C +D+E G H I J=G*H*I*F*44/12/1 000 (volume) Coal 10 4 t 2618 6417.74 3442.4 2669.67 1754 16901.81 25.8 98 20908 327614351.9 Washed coal 10 4 t 0 25.8 98 26344 0 Other Washed Coal 10 4 t 0 25.8 98 8363 0 Coke 10 4 t 0 29.5 98 28435 0 Coke oven gas bcm 1.99 0.06 2.05 13 99.5 16726 162623.6922 Other gas bcm 66.34 66.34 13 99.5 5227 1644620.998 Crude oil 10 4 t 0 20 99 41816 0 Gasoline 10 4 t 1.26 14.71 13.99 29.96 20.2 99 42652 936999.1654 Diesel 10 4 t 95.49 0.76 174.48 18.89 289.62 21.1 99 41816 9275986.686 Fuel oil 10 4 t 0 17.2 99.5 50179 0 LPG 10 4 t 0.49 0.96 1.45 18.2 99.5 46055 44341.5314 Natural gas bcm 0 15.3 99.5 38931 0 Other oil 10 4 t 18.91 5.3 15.04 39.25 20 99 38369 1093343.84 Other coke 10 4 t 0 25.8 98 28435 0 Other energy 10 4 t 5.68 7.08 12.76 0 0 0 0 total 340772267.9 Generation Emission Emission factor MWh (tco2e) tco2/mwh Thermal generation delivered to East China Power Grid 360848553.7 340772267.9 Imported from CCPG 13756040 10573694.7 0.76865833 Imported from Yangcheng 10705870 10168216.43 0.9497796 Coal consumption per kwh delivered by yangcheng plant 343gce/kWh total 385310463.7 361514179 OM 0.9382413

CDM Executive Board page 41 Data sources: China Energy Statistical Yearbook 2004,P166-P177,P301. China Electric Power Yearbook 2004. http://cdm.ccchina.gov.cn/website/cdm/upfile/2006/2006121591157181.xls Note: The emission factor of Yangcheng = Coal consumption rate*29271*25.8*44/12/ 1000000000

CDM Executive Board page 42 Table A-12 Simple OM emission factor of the East China Power Grid in 2004 Fuel types unit Shangha i Jiangs u Zhejian g Anhui Fujian Sub- Total EFco2 (tc/tj tc/tj) OXID Net caloric value (MJ/t,km3,tce MJ/t,km3,tce) CO2 emissions (tco2e tco2e) J=G*H*I*F*44/12/1 (tc/tj tc/tj) (%) (MJ/t,km3 MJ/t,km3) 0000(quantity quantity) A B C D E F=A+B+C +D+E G H I J=G*H*I*F*44/12/1 000 (volume) Coal 104t 2779.6 7601.9 4008.9 2906.2 2183.7 19480.3 25.8 98 20908 377594225.7 Washed coal 104t 0 25.8 98 26344 0 Other Washed Coal 104t 5.46 4.63 10.09 25.8 98 8363 78229.4857 Coke 104t 0 29.5 98 28435 0 Coke oven gas bcm 2.59 2.59 13 99.5 16726 205461.1526 Other gas bcm 72.46 72.46 13 99.5 5227 1796340.631 Crude oil 104t 0 20 99 41816 0 Gasoline 104t 2.69 27.17 6.23 36.09 20.2 99 42652 1128714.949 Diesel 104t 58.52 55.07 202.89 23.26 339.74 21.1 99 41816 10881236.51 Fuel oil 104t 0 17.2 99.5 50179 0 LPG 104t 0.77 0.55 1.32 18.2 99.5 46055 40366.08376 Refinery gas 104t 0.14 0.14 15.3 99.5 38931 30423.52536 Natural gas bcm 21.22 1.37 24.89 47.48 20 99 38369 1322597.847 other oil 104t 0 25.8 98 28435 0 other coke 104t 6.43 15.48 21.91 0 0 0 0 other energy 104t Total 393077595.9 Generation emission Emission factor (MWh) (tco2e) tco2/mwh Thermal generation delivered to East China Power Grid 414795262.6 393077595.9 Imported from CCPG 26933850 21843284 0.81099746 Imported from Yangcheng 11649610 11000044.99 0.9442415 Coal consumption per kwh delivered by yangcheng plant 341gce/kWh total 453378722.6 425920924.9 OM 0.9394374

CDM Executive Board page 43 Data sources: China Energy Statistical Yearbook 2005, P234-P257. China Electric Power Yearbook 2005. http://cdm.ccchina.gov.cn/website/cdm/upfile/2006/2006121591157181.xls Note: The emission factor of Yangcheng = Coal consumption rate*29271*25.8*44/12/ 1000000000

CDM Executive Board page 44 Table A-13 The OM CO2 emission factor of the East China Power Grid 2002 2003 2004 X Y Z Power generation delivered to t the Grid 312535277.100 385310463.700 453378722.600 A B C OM(2002,2003,2004) 0.946852574 0.9382413 0.9394374 OM 0.941050134 Note:Average OM = AX+BY+CZ/(X+Y+Z), where A, B and C are 2002 OM, 2003 OM, and 2004 OM, respectively. X, Y and Z are the power generation delivered to East China Power Grid in 2002, 2003, and 2004, respectively. 2. BM emission factor calculation of ECPG. Table A-14 The emission factor of the unit applying best commercially available technology Technology Coal fired plant Electricity supply EF co2 Emission factor OXID efficiency (tc/tj) (tco2/mwh) A B C D=3.6/A/1000*B*C*44/12 36.53% 25.8 0.98 EF coal, adv =0.9136 Table A-15 The capacity addition from 2002 to 2004 in the East China Power Grid Installed capacity in 2002(MW) Installed capacity in 2004(MW) Addition capacity (MW) Addition share (%) A B C=B-A D Thermal 61120.2 79424.1 18303.9 87.39% Hydro 13165.1 14417.8 1252.7 5.98% Nuclear 1678 3056 1378 6.58% Other 62.2 72.6 10.4 0.05% Total 76025.5 96970.5 20945 100% Share of 2004 installed capacity 78.40% 100% 21.60% Date source: China Electric Power Yearbook 2000-2002,2005. EF thermal, adv is the emission factor of thermal power. Due to the tiny share of oil and gas consumption,e.g., CO2 emission from the oil and gas in East China Grid accounts for 3.92% in total emission of the grid in 2004(http://cdm.ccchina.gov.cn/WebSite/CDM/UpFile/File1051.pdf, page 14), EF coal, adv is used instead of EF thermal, adv here.

CDM Executive Board page 45 EF = EF CAP / CAP =0.9136 87.39%=0.79839 tco2/mwh BM, y thermal, Adv Thermal, addition Total,, addition 3.Combined EF calculation of Northeast China Power Grid Table A-16 The combined emission factor of the East China Power Grid key parameter: OM(tCO2/MWh): 0.9411 BM*(tCO2/MWh)=0.79839*0.96 0.7665 CM(tCO2/MWh)=OM*0.75+BM*0.25 0.8974 *Revised as for conservative assumption, see details in Part B2 of PDD 4. IRR calculation of the proposed project. Tables B1 show the Parameters needed for calculation of IRR. The below Formulas are used in the IRR calculation process. They are based on «Method and Parameter of economic analysis for construction project» published by National Development and Reform Commission: a) Cash inflow= sales revenue+ fixed assets residue+ recovered liquid capital b) Sales revenue= annual output tariff (excl. VAT) c) Fixed assets residual value= original fixed assets value rate of assets residual value d) Recovered liquid capital= liquid capital input at beginning of project operation e) Cash outflow= capital construction investment + liquid capital+ operating cost + sales tax and extra charges + income tax Where: Capital construction investment = Static total investment Liquid capital = Liquid capital input of current year; Operating cost= annual salary per capita employee population (1+ rate of welfarism) + the sum of original value of buildings and equipment (rate of maintenance + rate of insurance premium) + (fixed amount of material cost+ fixed amount of other costs) installed capacity; Sales tax and extra charges=sales revenue rate of VAT (rate of city construction tax + rate of additional education fee); Income tax= sales revenue- sales tax and extra charges - operating cost - original value of houses and buildings (1- expected rate of residual value) expected depreciable life - machinery (1- expected rate of residual value) expected depreciable life - other assets amortizing period rate of income tax; f) Net cash flow = cash inflow - cash outflow g) The FIRR of the proposed project is calculated with the following formula: n annual net cash flown = 0 n (1 + FIRR) 1 where:

CDM Executive Board page 46 n is the project life time(including construction period and operation period); annual net cash flow n is the net cash flow in NO. n year. FIRR is the financial internal rate of return, a financial indicator of the proposed project. h) Net cash flow with CERs income = net cash flow without CERs income + CERs income excl. VAT -CERs income excl. VAT VAT rate (rate of city construction tax + rate of additional education fee)) (1 - rate of income tax) i) The FIRR of the proposed project with CERs income is calculated with the following formula: n ' annual net cash flown = 0 ' n (1 + FIRR ) 1 where: n is the project life time; annual net cash flow is the net cash flow with CERs income in NO. n year. ' n ' FIRR is the financial internal rate of return of the proposed project with CERs income. Table B-1 Main Parameters needed for calculation of key financial indicators No. Item Unit Figure 1 Type of wind turbines *** 850 2 Number of wind turbines 19 3 Installed capacity MW 16.15 4 Annual operation hours Hour 2803 5 Annual generation delivered to the grid 10000 kwh 4288 6 Electricity tariff(inc. VAT) Yuan/kWh 0.58 7 Static total investment 10000 Yuan 14659 8 Liquid capital 10000 Yuan 63 9 Construction period Year 1 10 Operation lifetime Year 20 11 Depreciable life of fixed assets Year 15 12 Rate of residual value of fixed assets % 5 13 Amortization period of other assets Year 0 14 Rate of fixed assets maintenance % 3 15 Rate of insurance premium of fixed assets % 0.25 16 Employee population 20 17 Annual salary per capita 10000 Yuan 3.5 18 Rate of welfarism % 36.5 19 Material cost Yuan/kW 0 20 Other costs Yuan/ kw 46.6

CDM Executive Board page 47 21 Rate of VAT % 8.5 22 Rate of city construction tax % 5 23 Rate of additional education fee % 4 24 Rate of income tax % 33 25 CERs Ton 38476 26 CERs Unit price ERU/Ton 10.21 27 CERs income (incl. VAT) 10000 Yuan 396 28 CERs income (excl. VAT) 10000 Yuan 365 29 Exchange rate ERU:RMB 10.074 Date source: items (1-24) are from the feasibility study report of the proposed project, item 29 is according to the exchange rate when the PDD was finished.

CDM Executive Board page 48 Cash Flow Table (total investment) Unit:10000 Yuan RMB No. Item Total Constructio n Period Operation Period 1 2 3 4 5 6 7 8 9 10 (10000kW.h)Annual output 85760 0 4288 4288 4288 4288 4288 4288 4288 4288 4288 Tariff (Yuan/kWh, excl. VAT) *** 0.0000 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 Rate of fixed assets maintenance and insurance premium (%) *** 0 3 3 3 3 3 3 3 3 3 Rate of income tax (%) *** 0 33 33 33 33 33 33 33 33 33 1 Cash inflow 46643 0 2292 2292 2292 2292 2292 2292 2292 2292 2292 1.1 Sales revenue 45847 0 2292 2292 2292 2292 2292 2292 2292 2292 2292 1.2 Fixed assets residual value 733 0 0 0 0 0 0 0 0 0 0 1.3 Recovered liquid capital 63 0 0 0 0 0 0 0 0 0 0 2 Cash outflow 34111 14659 956 893 893 893 893 893 893 893 893 2.1 Construction investment 14659 14659 2.2 Liquid capital 63 63 2.3 Operating cost 12865 643 643 643 643 643 643 643 643 643 2.4 Sales tax & extra charges 351 0 18 18 18 18 18 18 18 18 18 2.5 Income tax 6173 232 232 232 232 232 232 232 232 232 3 Net cash flow (1-2) 12532-14659 1337 1400 1400 1400 1400 1400 1400 1400 1400 4 Accumulative total of net cash flow *** -14659-13322 -11923-10523 -9124-7724 -6325-4925 -3526-2126 5 Net cash flow with CERs income 17383-14659 1579 1642 1642 1642 1642 1642 1642 1642 1642 Formatted: English (U.S.)

CDM Executive Board page 49 Cash Flow Table (total investment) Unit:10000 Yuan RMB No. Item Operation Period 11 12 13 14 15 16 17 18 19 20 21 (10000kW.h)Annual output 4288 4288 4288 4288 4288 4288 4288 4288 4288 4288 4288 Tariff (Yuan/kWh, excl. VAT) 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 0.5346 Rate of fixed assets maintenance and insurance premium (%) 3 3 3 3 3 3 3 3 3 3 3 Rate of income tax (%) 33 33 33 33 33 33 33 33 33 33 33 1 Cash inflow 2292 2292 2292 2292 2292 2292 2292 2292 2292 2292 3088 1.1 Sales revenue 2292 2292 2292 2292 2292 2292 2292 2292 2292 2292 2292 1.2 Fixed assets residual value 0 0 0 0 0 0 0 0 0 0 733 1.3 Recovered liquid capital 0 0 0 0 0 0 0 0 0 0 63 2 Cash outflow 893 893 893 893 893 893 1199 1199 1199 1199 1199 2.1 Construction investment 2.2 Liquid capital 2.3 Operating cost 643 643 643 643 643 643 643 643 643 643 643 2.4 Sales tax & extra charges 18 18 18 18 18 18 18 18 18 18 18 2.5 Income tax 232 232 232 232 232 232 538 538 538 538 538 3 Net cash flow (1-2) 1400 1400 1400 1400 1400 1400 1093 1093 1093 1093 1889 4 Accumulative total of net cash flow -727 673 2072 3472 4871 6271 7364 8457 9550 10643 12532 5 Net cash flow with CERs income 1642 1642 1642 1642 1642 1642 1336 1336 1336 1336 2132 Formatted: English (U.S.) FIRR without CERs income 6.87% FIRR with CERs income 9.08%