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7/28/2019 (12) ZafaranaWindProject Georgy
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Clean Development
Mechanism CDMEng. Rafik Georgy
120
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UNFCCC
1992
UNFCCC
United Nations Framework Convention On Climate Change3861994
531995
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Conference of Parties COP
COP31997Kyoto Protocol
1531999
Annex 1 Countries
Non Annex 1 Countries
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56%1990,2008-2012
()
55%
55%
,(16):
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*CO2-(GWP*)
*CH4-20
*N2O-*HFCs
*PFCs-
*SF6
*100
Global Worming Potential (GWP)
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Emissions TradeET
J oint Implementation J I
Clean Development MechanismCDM
()
():
o
o
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(Additional)
Business As UsualBaseline Scenario
()()
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2002
Designated National AuthorityDNA
-
CDM-DNA
:
o
o
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()
Certified Emission ReductionsCERs
0
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CDM - KYOTO CRITERIA Contributes to the sustainable development of the
host country.
Results in emission reductions that would nothave happened otherwise.
Generates real, measurable and long-term climatechange mitigation benefits.
Approved by parties involved.
Credits potentially earned from 2000 onward(through 2008-2012).
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Zafarana Wind Power Plant as aCDM Project
Zafrana project is an 120 MW wind power plant.
More than 440 GWh of electricity per year.(based oncapacity factor 42 %)
Around 90,000 TOE Saved yearly.
About 230,000 t of Certified Emission Reductions
annually (CERs) if designated as CDM. Expected life time 2025 years
A cooperation project between NREA of Egypt andJ BIC of J apan who Supports project financing.
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CDM Procedures
PDD Production
Pubic & Expert Opinions.
Host country confirmation.
Methodology Panel Approval.
Validation.
CDM Executive Board Approval.
Registration.
Monitoring.
Verification.
Certification.
CER issuance and registration.
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PROJ ECT DESIGN DOCUMENT(PDD)
General description of project activity.
Baseline methodology. Duration of the project activity / Crediting period.
Monitoring methodology and plan.
Calculation of GHG emissions by sources.
Environmental Impacts. Stakeholders comments.
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What is a BASELINE
It is The Business as usual that is what wouldotherwise happen if CDM project will not beimplemented.
It is the reference value to estimate thereduction of CO2 ( or GHG ) emissions.
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Baselines and Additionality
A baseline is the emissions that would have occurredIn the absence of the project or without projectscenario
Covers gas emissions from all sectors and sourceswithin the project boundary.
It is the key to the GHG reduction projectused to
determine the emission reductions (ERs) from the
project activity.
Additionalitymust demonstrate that without the
project, the GHG emissions would not have been
reduced.
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Approaches to Baselines
COP7 held in Marrakech in 2001 formulated CDM
Modalities & procedures
The Marrakech Accords lay out three approaches
from which proponents should select as the basis fortheir baseline methodology :
A) actual current or historical emissions, or
B) emissions from a cost-effective technology taking
into account barriers to investment, or C) the averaged emissions of similar projects in the
past 5 years in similar socio-economic, environmental
and technical conditions and whose performance is in
the top 20 percent.
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General Baseline Requirements
Baseline Must be project-specific. In describing the chosen methodology, an
explanation must be given as to : Why the method was chosen How it will be applied How it was established in a transparent and
conservative manner
How it takes into account any relevant national orsectoral polices.
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Additionality
Probably, the most important issue for CDM-projectbaseline methodology approval is whether the
project satisfies the additionality criterion.
Two interpretations turning the condition intofulfillment of two criteria :
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Additionality ( cont. )
Soft interpretation ; Environmental Additionality : theproject must show, through the baseline scenario,that CDM project, compared to alternative production
methods, reduces CO2emissions during its life timeproduction process.
i.e the project will accomplish both:
o Measurable and certified GHG emission reductions
o Long term climate change mitigation benefits
Or
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Additionality ( cont. )
Hard interpretation; insists on proving that theproject, being more expensive without counting CERrevenues compared to the alternative base line,
would not be implemented if the CDM project did notexist
Zafarana Project Satisfies BOTH !!
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BaseIine Methodology for theWind Project
Presently, no approved CDM methodology to beapplied for Grid Connected Wind Power Generation.
New methodology is proposed in accordance withCDM modalities and Procedures.
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Baseline Methodology Steps
The project is additional because: There is no incentive program to promote wind power
projects currently in Egypt.
The cost for a wind power plant is higher than forconventional thermal power plants, in terms oflevelised cost of KWh produced.
The economic growth in Egypt has led to stricter
terms and conditions for foreign financial assistance. Naturally, the project will result in CERs.
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Investment Barriers for windPlants
No incentives for wind power generation.
Wind is more capital intensive.
Low price for natural gas.
Result:
Currently wind generated KWh cost cannot competewith thermal generated KWh cost.
Wind cannot be viewed as BAU leading to :
WIND NEED for CDM SUPPORT TO BE IMPLEMENTED.
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Base Line MethodologyMargins Considered
Operating Margin :
Average of all generation types excluding low cost /must run plants. Those excluded were hydro facilitieswhile existing wind plant is a debatable issue.
Build margin :
Average of the most recent 5 plants built, or mostrecent 20% ; under implementation projects should beconsidered.
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Steps to determine Baseline
Is the project additional?
Will the project affectthe operating margin?
Project cannotqualify as CDM
Will the project alsoaffect the build margin?
Build marginapproach
Combinedmargin
approach
Operatingmargin
approach
Determine:Operating marginBuild margin
Combined margin
Methodologynot
applicable
Yes
Yes
Yes No
No
No
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Determining Operating Margin.
Less than 20% generation comes from hydro.
More than 80% from thermal Power Plants. Wind will replace thermal generation mix of
Combined Cycle, Steam Turbines and Gas Turbines.
A conservative approach.
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Determining Build Margin
Emission rate of :
Most recent 20% plants built, or
Most recent (5) plants built gives same result.
( two approaches give same result for Zafarana )
Cairo North (2),750MW, CC, 5.3%.
Cairo North (1),750MW, CC, 5.256%.
Zafarana, 77MW, wind, 0.3%.
Suez Gulf (1,2) BOOT,682MW, ST 4.8%.
Port Said East (1,2), 682MW, ST 4.6%.
Conservative Approach to Consider Wind Plant.
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Electric load curve
800
900
1000
1100
1200
1300
1400
1500
1600
1700
1800
1900
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
MW
Pick period
(2 hours)
Day period (12 hours)
Marginal
generators
Basegenerators
Wind Energy farm
contribution
Power Generators Selection For Baseline Calculation
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To determine Operating Margin
Notes:
For the Egypts grid excluding Low-cost / must-run(around 33 power plants)
Total Capacity (MW) = 12,933
Net Power (GWh) = 62,353
Fuel Consumption (103 toe) = 14,378
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Egypt's grid excluding low-cost/must-run
Power Plant Type of
Generation
Capacity
(MW)
Net Power
(GWh)
Fuel
Consumption
(103
toe)ShoubraEl Khima ST 1260 7141 1686
Cairo West ST 350 1563 426
Cairo West ext. ST 660 3521 791
Cairo South I CC(hybrid) 570 3236 711
Cairo South II CC 165 1018 186
Wadi Hof GT 100 20 8
Tebbin GT 46 103 43
Tebbin ST 45 7 3
Damietta CC 1125 6736 1294
Talkha(CC) CC 283.6 1410 346
Talkha(ST) ST 90 1 0.2Talkha 210 ST 420 1912 487
Ataka ST 900 4634 1053
Abu Sultan ST 600 2879 824
Shabab GT 100 73 25
Port Said GT 64 24 9
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Arish ST 66 356 108
Oyoun Mousa ST 640 3655 823
Kafr El Dawar ST 440 1411 376Mahmoudia (G) GT 180 51 19Mahmoudia (CC) CC 308 1898 386
Damanhour 300 ST 300 945 211
Damanhour Ext ST 195 742 195
Damanhour (CC) CC 152.8 923 177Seiuf (G) GT 200 38 14
Seiuf (ST) ST 113 355 131Karmouz GT 25 1 0.1
Abu Kir ST 900 3896 925Sidi Krir 1.2 ST 640 3662 765
Matrouh ST 60 149 41Walidid ST 600 2819 674
Kuriemat ST 1245 6713 1489Assiut ST 90 461 152
ToTal 12.933 62.353 14.378
Source: Annual Report 20012002 , Egyptian Electricity Holding Company
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To determine build Margin
To obtain the CO2 emission factor for the build
margin, we have to calculate the emission factorfor the resent 5 plants.
o Total Net Power (GWh) = 19,754o Fuel consumption ( 103 toe ) = 3,994
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Plant Plant Type NetPower(GWh)
(% of total3 )
Fuel Consumptions(103 toe) Commissioning
Date
Cairo North ( 2 ) CC
750 MW
5256
(5.3%)
988
)based onNREA
estimate of fuel
consumption)
05/06
06/07
Cairo North (1 ) CC
750MW
5256
(5.3%)
988
(as above)
03/04
04/05
Zafarana Wind
77 MW
280
(0.3%)
0 03/04
Suez Gulf 1.2
BOOT
ST
682 MW
4481
(4.6%)
1009
(based on OyounMsousa)
02/03
Port Said East 1.2BOOT
ST
682 MW
4481
(4.6%)
1009
(as above)
02/03
TOTAL 19754 3994
The 5 Recent Plants
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Baseline Methodology steps(continued)
The project will affect Operating margin and build
margin. Combined margin =
{Operating margin + [Build margin x n]}/n+1
n has been chosen to be 1 instead of 0.6 which
would have been in favor of wind. Again complying with the conservative approach
CDM criterion
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Monitoring Methodology
Presently there is no monitoring methodologyapplicable to the project.
Base Line source of emission is grid electricity whichcan be reasonably monitored as an indication forPotential fuel consumption (to be saved) henceavoided emissions of CO2mainly.
Duration of the project is yet to be chosen with
preference to 7 years at least for the timebeing.
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Environmental Impacts
Noise Pollution
Negligible, Being an arid area.
Visual Pollution
Same, no community nearby.
Land Use
Same, however, during construction fences willbe erected around.
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Environmental Impacts (CONT.)
Potential Impact on Migrating Birds. Relatively of more concern.
Zafarana is close but not in a major Pathway ofbirds.
No green areas, fresh water nor food scraps ofhuman activity exist as it is a remote arid area.
Result:Danger is minimum and almost
negligible.
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CDM Procedures
PDD Production
Pubic & Expert Opinions.
Host country confirmation.
Meth Panel Approval.
Validation.
CDM Executive Board Approval.
Registration.
Monitoring.
Verification.
Certification.
CER issuance and registration.
P j C l f h CDM
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Project Cycle for the CDM
DNA
1- Project Design
& Formulation
2- NationalApproval
3- Validation-Registration
4- ProjectFinancing
Project DesignDocument (PDD)
Operational
Entity A
DOE (A)
Investor
5- Monitoring ProjectParticipants
MP &EB
P j t C l f th CDM
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Project Cycle for the CDM
6- VerificationCertification
7- Issuance ofCERs
Monitoring Report
OperationalEntity B
DOE (B)
Verification ReportCertification Report
Request for CERs
EB - Registry
Legends
Activity Report Institution
h fi 36 d
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Meth. No. Type 1.Mark 2.Mark GHG reduction/yr Country Investor yr.
1 Bagasse power B A 143 ktCO2 Brazil Unilateral 72+29 Fuel switch from coke to charcoal in steel works C EB14 ca. 1000 ktCO2 Brazil IFC-Netherlands & Japan 7
3 CO2 from NH3 production used in methanol prod. C 229 ktCO2 Trinidada & Tobago Germany 10
4 Landfill gas flaring AM2 ca. 800 ktCO2 Brazil Unilateral 7
5 Landfill gas electricity B AM3 ca. 300 ktCO2 Brazil WB NCDF 7
6 Hydro Power C 144 ktCO2 Guatamala PCF 7
7 Burning HFC23 from HCFC22 production AM1 1400 ktCO2 South Korea Japan 7
8 Hydro Power C 100 ktCO2 Costa Rica CERUPT 10
9+14+15+19 Rice husk power plant (el + steam + cement) C AM4 400 ktCO2 Thailand Rolls-Royce Power + 7
10 Landfill gas electricity B A 400 ktCO2 South Africa PCF 7
11 Bagasse Power C 100 ktCO2 India Unilateral 712 Wind farm B 53 ktCO2 Jamaica CERUPT 10
13 Biogas from palm oil waste water 27 ktCO2 Malaysia Japan 10
16 Fuel switch from coal to natural gas B A 18 ktCO2 Chile Nestle Chile 7
17 Efficiency improvement of steam use at refinery Meth9 100 ktCO2 China Unilateral 10
18 New cogeneration plant using natural gas Deskr. 115 ktCO2 Chile Japan (J-Power) 10
20 Hydro Power Meth9 70 ktCO2 Colombia Japan (J-Power) 7
21 Landfill gas power for on site usage A 70 ktCO2 Brazil CERUPT 10
22 Biogas power from swine manure 90 ktCO2 Chile Canada 7
23 Hydro power A 70 ktCO2 Mexico PCF 7
24 Wind farm 45 ktCO2 Colombia PCF 725 Biomass residues power plant 85 ktCO2 India Swedish Energy Agency 10
26 Recovering associated gas in stead of flaring 670 ktCO2 Vietnam Japan 10
27 Bagasse power expansion 23 ktCO2 Brazil CERUPT 10
28+35 Switch from coal/lignite to agro-biomass power Meth9 600 ktCO2 India PCF 10
30 Bagasse power and steam 95 ktCO2 India Local 10
31 Power from waste heat in iron kiln 37 ktCO2 India Unilateral 10
32 Biogas power from municipal waste 100 ktCO2 India PCF 10
33 Energy efficient expansion of cement factory 80 ktCO2 Costa Rica CERUPT 7
34 CH4 & N2O reductions from manure management 20 ktCO2 Brazil Canada 7
36 120 MW wind farm in Zafarana 227 ktCO2 Egypt Japan (JBIC) 7
The first 36 proposed newmethodologies sent to the EB
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Conclusion:
At 5 US$ per ton CO2 & around 0.56kg CO2 avoidedemissions per KWh produced from thermal powerstations -Wind produced KWh will have a bonus of
around 2 piaster which cannot close the gap betweenwind and thermal generation.
CDM cannot solely make uncompetitive projectseconomically attractive.
Rather, CDM can make near economic projects
feasible or more attractive.
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