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Page 1 Project Design Document March 2004 EX Corporation Methane Recovery and Renewable Electricity Generation Project at Palm Oil Mill in Malaysia

Project Design Documentgec.jp/gec/jp/Activities/cdm/PDD03_Ex.pdf ·  · 2004-06-02Project Design Document March 2004 EX Corporation ... E. Calculations of GHG emissions by sources

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Project Design Document

March 2004

EX Corporation

Methane Recovery and RenewableElectricity Generation Projectat Palm Oil Mill in Malaysia

Page 2

CONTENTS

A. General description of project activity 3

B. Baseline methodology 7

C. Duration of the project activity / Crediting period 19

D. Monitoring methodology and plan 20

E. Calculations of GHG emissions by sources 25

F. Environmental impacts 35

G. Stakeholders comments 35

Annexes

Annex 1 Information on participants in the project activity 36

Annex 2 Information regarding public funding 37

Annex 3 New baseline methodology 38

Annex 4 New monitoring methodology 60

Annex 5 Baseline data 65

Annex 6 Abbreviation 66

Page 3

A. General description of project activity

A.1. Title of the project activity:

Title: Methane Recovery and Electricity Generation Project at Palm Oil Mill in Malaysia

A.2. Description of the project activity:

A.2.1. Background and Purpose of the project activity

BackgroundThis PDD is proposed against the following background conditions.

• Promotion of renewable energy in the National Energy Development Plan in MalaysiaThe Malaysian Government is currently promoting renewable energy development as the alternativeto fossil fuels (oil, gas, and coal) and hydropower. The Government targets to increase the ratio ofrenewable energy for the total public electricity supply to 5 (five) % by the end of 2005. To furtherpromote small-scale power generation with renewable energy, the Government established in 2001the Small Renewable Energy Power Programme (SREP). Through the official accreditation bySREP, those who generate electricity with renewable energy are provided with the incentive ofselling it with the premium price.

• The problem of biogas generated from Palm Oil Mill Effluent (POME)Wastewater treatment is amongst the most important pollution control processes in the palm oil millsystem. A large amount of effluent called POME is generated in the process of crude palm oilproduction. To meet the effluent standard in Malaysia, anaerobic digestion process is usuallyapplied in the initial treatment of POME in palm oil factories, but it also releases a large amount ofmethane, one of greenhouse gases (GHGs) subject to reduction under the United Nations FrameworkConvention on Climate Change (UNFCCC). Viewing from protecting global environment, reductionof such methane emission should also be properly addressed in Malaysia, the largest palm oilproducer in the world.

PurposeThe purpose of the project is to reduce methane emissions from the designated palm oil mill throughimplementation of the project plan mentioned in A2-3.

A.2.2. Contribution of the project activity to the sustainable development

This project activity will contribute to compliance of the target stating in the 8th Malaysian Plan 2001-2005 that the ratio of renewable energy will increase to 5% of the total domestic energy demand by theend of 2005.

The criteria1 for sustainable development currently applied in Malaysia are that the project must complywith environmental, developmental and socio-economic purposes of sustainable development. Thisproject activity will strongly support the sustainable development in Malaysia in view of the following 3aspects.

1 The remark of Mr.Chow Kokee who is the director general of the Malaysian Meteorological Service, and also amember of the CDM Meth Panel.

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i) EnvironmentThe project will alleviate offensive odor of POME and provide cleaner environment.

ii) DevelopmentThe project will contribute to diversification of energy resources through development ofrenewable biomass energy (energy use of methane for small scale power generation) and also tothe development of new technology and additional foreign capital investment through itsimplementation. .

iii) Social economyThe project will create additional job opportunities.

A.2.3. Project Plan

The project consists of the following components:

[Component A]• Methane RecoveryThe POME treatment process in the project mill is converted from the existing (BaU-Business as Usual)open lagoon method to sealed digester tank method for methane recovery.

[Component B]• Power generation with methane gas:

Gas engine power generation will be operated with recovered methane.• In-house utilization of generated electricity: By utilizing the generated electricity, the mill will lower

the cost of electricity from public grid (TNB).• Supply electricity to the grid electricity: The mill will also sell some of the generated electricity to

the public grid through connection with the nearby TNB’s sub-station.

A.3. Project participants:

EX Corporation and The project mill are the partners involved in the project activity. Kyushu Institute ofTechnology and Universiti Putra Malaysia (UPM) are the advisors for the project activity. The contactfor the project activity is EX Corporation.

EX Corporation, is the Japanese environmental consulting firm, specializing in waste treatment andgreenhouse gas reduction and responsible for planning, technical and financial appraisal andimplementation of the current project activity.

The project mill, is the owner of project mill (palm oil mill) and the Malaysian partner of this projectactivity, who has 3 palm oil mills in the peninsula of Malaysia.

Kyushu Institute of Technology, is the Japanese university of technology, specializing in research anddevelopment of the cutting-edge engineering technologies in the field of environmental science andresponsible for providing technological advice to this project activity.

Universiti Putra Malaysia (UPM), is the Malaysian university specialized in environmental biotechnologyparticularly in utilization of organic wastes and responsible for providing technological advice to thisproject activity from Malaysian side.

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A.4. Technical description of the project activity:A.4.1. Location of the project activity:

A.4.1.1 Host country Party(ies): Malaysia (Investing country is Japan)A.4.1.2 Region/State/Province etc.: Langat Selangor StateA.4.1.3 City/Town/Community etc: Kuala LumpurA.4.1.4 Detail on physical location, including information allowing the unique

identification of this project activity:

The project mill is be conveniently located in the suburb area of the Kuala Lumpur, the capital city ofMalaysia, and has a good access to the main highway of Malaysia. The mill is surrounded by palm oilplantation.

ChartA.1. Mill location

Project Site

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A.4.2. Category(ies) of project activity

Since this project aims at generating electricity partially for power grid by collecting and consumingmethane from POME as the renewable energy resource, it is categorized as shown below in accordancewith the definition in UNFCCC.

Sectoral Scope: Waste handling and disposalCategory: Methane recovery and power generation

A.4.3. Technology to be employed by the project activity: • Anaerobic fermentation technology by sealed digesterAnaerobic fermentation technology by sealed digester will be employed in this project. Two tanks will beinstalled which have 10m water depth and a diameter of approximately 17m and the volume for each tankwill be 2,400m3. The designed minimum retention period is 10days.

A.4.4. Brief explanation of how the anthropogenic emissions of greenhouse gases (GHGs) bysources are to be reduced by the proposed CDM project activity, including why the emissionreductions would not occur in the absence of the proposed project activity, taking into accountnational and/or sectoral policies and circumstances:

The baseline scenario is defined as the most likely future scenario in the absence of the proposed CDMproject activity. The baseline scenario is that methane emission from anaerobic digestion treatment ofeffluent will continue in the project mill.

Biogas recovery for electricity generation will reduce CH4 emission at the rate of approximately 139,161tons of CO2 annually during the project period (7 years). Furthermore, the utilization of generatedelectricity as the substitutes for the grid electricity will also reduce the GHGs emission at the rate of16,876 tons of CO2 per year during the project period (7 years) while 18,228tons of CO2 is emittedannually by methane combustion in the project scenario (7years). As a result, the net reduction of CO2 inthe project scenario is estimated to 137,809 tons per year during the project period.

In the absence of the proposed project activity, it is unlikely that such biogas recovery and powergeneration system will be implemented because of the reasons described below(See B4).

- The system is not economically viable;- The current wastewater treatment system with anaerobic digestion lagoon is enough to meet

the effluent standard in Malaysia. There is no regulatory or economic incentive enough for oilpalm factories to reduce methane emission from the process with additional investment;- There is no strong land shortage or land development wave in the neighbouring area of the

mill that may require the change of current effluent treatment system with a large area ofanaerobic lagoon; and,- Even with the implementation of stricter effluent standard, the mill operators may only

require minimal investment to modify the current wastewater treatment plant to meet it.

A.4.5. Public funding of the project activity:

The implementation of this project is not dependent on any Official Development Assistance resources orany other resources from any international development funding agency.

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B. Baseline methodology

B.1. Title and reference of the methodology applied to the project activity:

There are no baseline methodology approved by UNFCCC that can be applied to this project. Therefore anew methodology for this project is proposed in Annex3.

The title: The Baseline Methodology of Methane Recovery from Palm Oil Mill Effluentand Renewable Electricity Generation

B.2. Justification of the choice of the methodology and why it is applicable to the project activity

B.2.1. General Approach

In this project, “Existing actual or historical emissions, as applicable”2, is applied as the GeneralApproach for the estimation of baseline emission.

B.2.2. Applicability

This project is compatible with the conditions required for applying the methodology proposed in Annex3 for the reasons below.

• Size of business: Project owner is the small-scale company that owns and operates three factories inMalaysia.

• Existing POME treatment process: Existing POME treatment process in the project mill is thecombination of aerobic and anaerobic lagoon methods.

• Project component: This project consists of methane recovery and power generation with therecovered methane gas. (Some of the generated electricity substitutes the purchasing electricity fromTNB while the remainder will be sold to TNB)

B.2.3. Determination of the Baseline ScenarioIn accordance with the methodology proposed in Annex 3, baseline scenario is determined by examiningthe following items.

[Check item A]• Is the current POME treatment system a combination of anaerobic and aerobic lagoon methods?

Yes, the mill currently treats POME by the total of twenty seven lagoons, comprising of sixanaerobic lagoons, nineteen aerobic lagoons, and one acidification lagoon and sedimentation lagooneach. No digester is introduced.

[Check item B]• Are there any policy incentives now available or to be available some time in future that encourage

or induce palm oil factories to reduce methane emissions from POME or employ methane gas powergeneration?

As of now, the Malaysian Government has no plan to establish laws or regulation to control methaneemissions from any sources during the project period. As to the promotion of renewable energy, the

2 CDM modalities and procedures, Marakesh Accord

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Government established a preferential purchase mechanism with premium price called SREP in 2001.However, even under the umbrella of SREP, the current project will not be financially feasible, asshown later in B4-1. Therefore, SREP will not be enough for the palm oil industry to invest inrecovered methane gas power generation. Thus, it is estimated that there will be no policy incentiveenough to induce palm oil industry to implement methane recovery and power generation inMalaysia during the project period.

[Check item C]• Is the methane gas power generation likely to be technically as well as economically feasible without

CDM?

The project will not be financially feasible without CDM, as shown later in B4-1. In addition, thereis so few engineers in Malaysia who can properly conduct safety control of the methanefermentation system to be applied in the project.

[Check item D]• Is the stricter effluent standard likely to be employed during the project period?

In Malaysia, the government had tightened the effluent standards five times from 1978 to 1984.Since 1984, however, no revision has not been carried out for over twenty years. Our interviewsurvey to the Ministry of Environment, also revealed that the current standard would not be revisedfor now and in the near future. The Ministry is not slated Based on the information obtained above,it is estimated that the current effluent standard will be maintained during the project period from2006 to 2013.

ChartB.1.  Historical tightening of effluent standardJuly/1978~June/1979

July/1979~June/1980

July/1980~June/1981

July/1981~June/1982

July/1982~June/1983

July/1984~

BOD 5,000 2,000 1,000 500 250 100COD 10,000 4,000 2,000 1,000 - -

Currently in 2003, the Ministry of Environment, Malaysia provided the effluent standard of BOD asfollows:

(a) In the case of effluent discharge at the down stream of residential area: BOD 100 ppm(b) In the case of effluent discharge at the upper stream of residential area: BOD 20 ppm

The project mill falls under the category (a). Currently BOD of the effluent at the discharge point is80 ppm, well below the standard.

Taking all the above into account, waste water treatment process applied in the baseline case (BaUscenario) can be determined as anaerobic lagoon process.

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B.3. Description of how the methodology is applied in the context of the project activity:

Baseline emission of GHGs is estimated by applying the following parameters to the calculation formulamentioned in the new baseline methodology.

ChartB.2. GHG to be counted and their sourcesBaseline Scenario Project Scenario

included as emitted GHG included as emitted GHGCO2N2OCH4CO2N2OCH4 ○CO2 ○N2OCH4CO2 ○

N2O ○

CH4 ○

CO2 ○

N2O ○

CH4 ○

④Emission from start up ofmethane power generationfacility

Fossil origin GHG emission(CO2, N2O, CH4)substituted by methanepower generation

②GHG (CH4) Emission fromPOME

③GHG emitted from methanepower plant

No. Sources GHG

①Emission fromtransportation of increaseof FFB received

B.4. Description of how the anthropogenic emissions of GHG by sources are reduced belowthose that would have occurred in the absence of the registered CDM project activity (i.e.explanation of how and why this project is additional and therefore not the baseline scenario)

Additionality of the current project is demonstrated by clarifying the three barriers of implementing thecurrent project in the baseline scenario. Three barriers are comprised of financial, policy, and technicalbarriers.

B.4.1. Economical barriers

Financial feasibility of the project is assessed here so as to clarify its financial barriers in the baseline case.

[Step1] : Estimation of electricity purchasing cost in the baseline scenario(ElectricityExpense_purchase)

The project mill currently purchases the electricity from TNB at the price of 0.258RM/kWh. The totalcost of purchasing electricity from public grid (TNB) in the absence of the proposed project is estimatedby the formula given below:

Total cost of purchasing electricity in the absence of the proposed project.

ElectricityExpense_purchase

= Annual amount of purchasing electricity × Unit price of electricity= 816×103 (kWh) ×0.258 (RM/kWh)÷3.8(RM/US$)= 5.54×104 (US$/y)

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ChartB.3. Data for Electricity ExpenseItem Value SourceElectricity bought from the grid 816×103 (kWh) Data from millUnit cost of grid electricity purchase 0.258 (RM/kWh) Data from millExchange rate 3.8(RM/US$) Official data (fixed since 1998)

[Step2]:Estimation of the Project CostStep2.1. Construction cost of sealed digester

The construction cost of sealed digester is estimated here based on determination of the volume andnumber of digester tanks. The volume and number of digester tanks is determined so that necessaryretention time for digestion can be maintained even though the amount of POME generation keeps itsmaximum for a certain period of time(10days).

The maximum amount of POME generation from the project mill is estimated by the following steps: STEP1: Estimation of the maximum Fresh Fruit Bunch (FFB) input per month to the project mill

Design capacity of the sealed digester tank will be determined in accordance with the maximum annualFFB input for the past 7 years.

Although the data of annual total FFB input to the project mill is available for the year 2003, which is24,485 tons, the data of the monthly and daily FFB input is not recorded in the project mill. Since themaximum monthly FFB input is needed for determining the capacity of digester, the monthly FFB inputto the project mill is estimated by the analogy of the national level monthly FFB input data from “Reviewof the Malaysian Palm Oil Industry 2002 (MPOB)”. The table below shows the estimated monthly FFBinput in the project mill.

ChartB.4. Estimated Monthly FFB Input (maximum) in the Project MillFFB ReceivedMonth ton/month ton/day

Jan 21,425 714Feb 17,684 707Mar 18,704 624Apr 18,704 624May 19,724 658Jun 19,044 635Jul 19,384 646

Aug 21,425 714Sep 24,145 805Oct 24,485 979Nov 22,105 737Dec 19,724 658

Total 246,555(t/y) 246,555(t/y)

Maximum POME generation is estimated by solving the equation below based on the estimatedmaximum monthly FFB input, which is 24,485 tons/month recorded in October 2003.

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Maximum POME generation= Maximum monthly FFB input (tons/month) ÷Monthly operating days (days/month)×R_(FFB→

CPO) (t_CPO/t_FFB)×R_(CPO→POME) (m3_POME/t_CPO)×Safe Factor= 24,485 (t/m)÷25 (d/m)×0.189 (t_CPO/t_FFB )×2.5 ( m3_POME/t_CPO)= 463 (m3/d)

where:R_(FFB→CPO): Amount of CPO produced per unit FFBR_(CPO→POME): Amount of POME generated per unit CPO production

Based on the maximum daily POME generation estimated above, the required total capacity of digester isgiven by solving the following equation:

Required capacity of digester= Maximum POME generation (m3/day)× Required retention time (days)= 463(m3/day) ×10(days)= 4,630(m3)

The cost data of digester tank is only available from the joint R&D project between KIT and UPM. Itestimates the total cost of the digester with a capacity of 500 cubic meter as 120 thousand US dollars.Based on this, the possible lowest cost combination of digesters is selected as shown in the table below.

ChartB.5. Selected combination of digesters for the projectTank volume Construction cost Units Total volume

2,400(m3) 357,000(US$) 2 4,800(m3)

The total construction cost of digesters are estimated as follows:Total construction cost

= Unit cost of digester (US$/unit) ×Number of digester (unit)= 357,000×2= 715,000(US$)

Step2.2.:Power generation facility

To estimate the initial cost of power generation facility, the capacity of gas engine is determined based onthe maximum FFB input in the project mill. The parameters required to determine the capacity of gasengine are given in the table below. Detail methods of calculation process are described in E4.1. Step2.

ChartB.6. Required ParametersItem Value Unit Remark

Maximum FFBreceived

979 Ton/day See ChartB.4.: peak value of the peak month(October) of the maximum year of the actual yearlyrecord of the most recent 7 years from the projectimplementation.

Minimum FFBreceived

590 Ton/day See ChartB.4.: lowest value of the lowest crop month(February) of the minimum year of the actual yearlyrecord of the most recent 7 years from the projectimplementation.

Bo 0.25 kg_CH4/m3_POME IPCC Default factorMCF(Project) 0.90 Methane emission co-efficient(See E4.1. Step2)HV_Methane 55.5 MJ/kg Theoretical value

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(Heat value)CF(joule→watt-hour) 0.2778 kWh/MJ Theoretical valueEfficiency 0.25 It is said that current efficiency of methane power

generation is 25%~35%. Most conservative value(25%) is applied as nominal value in this project.

Based on the parameters above, the maximum and minimum power of gas engine are estimated byapplying the following formula.

Maximum electricity (peak power)= FFB received in the peak month (ton/day) ÷24(h)×R_(FFB→CPO)×R_(CPO→POME)×ΔCOD×Bo

×MCF×HV_Methane×CF(joule→watt-hour)× Efficiency= 917(kW)

Minimum electricity= Estimated minimum FFB received (ton/day)÷24(h)×R_(FFB→CPO)×R_(CPO→POME) ×ΔCOD×

Bo×MCF×HV_Methane×CF(joule→watt-hour)× Efficiency= 552(kW)

Taking into account the above, the rated apparent power of gas engine is determined as920 kilowatt. Thecost data of gas engine with a capacity of 600kW is 300 thousand dollars. Based on this, the price of gasengine with 920 kilowatt is estimated as 423,000 US dollars.

ChartB.7. Specification of gas engine to be installedGenerator Construction cost Units Cost920(kW) 423,000(US$/unit) 1 423,000 (US$)

[Step3]:Power lineTNB power substation is currently located within the premise of the project mill while distance from theproposed location of methane gas power generation to power station is approximately 200 meter.According to TNB, the cost of power line is 39,474US dollars per kilometre length.

The cost of power line in the project is estimated as follows:Power transmitting cost = 39,474 (US$/km)×0.2 (km) = 7,895US$

ChartB.8. Data for Power cableUnit cost of power

lineLength Total Cost

39,474(US$/km) 0.2(km) 7,895(US$)

[Step4]:Manpower costUnit labour cost is determined in reference to the report named ”Feasibility Study on Grid ConnectedPower Generation Using Biomass Cogeneration Technology”(Pusat Tenaga Malaysia 2000). Allocationof manpower and the total manpower cost is given in the table below.

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ChartB.9. Data for manpower costPosition Labour cost(RM/m) Person/shift Shift Months Cost(RM) Cost

(US$/year)Site supervisor 5,000 1 3 12 180,000 1,316Engineer A 2,000 1 3 12 72,000 526Engineer B 750 1 3 12 9,000 197

Total 261,000 73,421※ 1US$ =3.8 RM

[Step5]:Operation and maintenance cost (O&M cost)

O&M cost is assumed as 3 % of the total construction cost of the sealed digesters and power generationfacility.O&M cost = Construction cost(Methane fermentation facility+power generation plant)×0.03

=(735,600+429,000)×0.03=34,900(US$)

[Step6]:IRR calculation of power generation project without CDM

To assess financial feasibility of the project, the internal rate of return (IRR) is estimated in the case of theproject without CDM. Since the project will not guarantee the minimum amount of electricity to be soldto public grid in the contract, the sales price of electricity will be lower than the premium price underSREP. However, the estimation here applies the premium price for income calculation, therefore, projectincome may be overestimated. Other preconditions applied in feasibility assessment of the project(without CDM) are given in the table below.

ChartB.10. Preconditions of the ProjectDuration of the power sales project 21 yearsCDM project period 7 yearsElectricity price (purchase) 0.258 RM/kWhElectricity price (sales) 0.16 RM/kWh3

ChartB.11. Revenue, expenditure and IRRItem One year

(US$)Total project period(21years)

(US$)Cost of tank construction 715,000 715,300Cost of gas engine 423,000 423,000Cost of power line 7,900 7,900Labour cost 73,400 1,542,000O&M cost 34,900 733,700Cost total 1,254,000 3,422,000Cost reduction by savingelectricity

55,400 1,164,100

Electricity sales revenue 138,800 2,914,300Revenue total 194,200 4,078,400IRR 6.6%

Taking into account the open market rate of 7% in Malaysia, the minimum required IRR for financiallyfeasible private investment project is estimated to be around 15%. Without CDM, the IRR of the business

3 SREP preferential price

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only reaches 6.6% according to the estimation. The result clearly indicates that the project will not befinancially feasible without CDM and will not be realized in the baseline (BaU) scenario.

The project will secure its financial viability through selling of the generated electricity to public powergrid and certified emission reduction (CER). The project is estimated to reach the minimum financialviability of 15 % of IRR if it is carried out on the following conditions:

Period of selling electricity: 21 yearsPeriod of obtaining CER: 7 yearsPrice of CER: US$ 6.3 /ton of CO2 reduced

The figure below indicates the change in IRR of the project depending upon the trading price of CER.Although CER will be traded at the price between 3 and 5 US dollars per ton of CO2 reduced, the projectwill be financially viable if CER can be trade at the price of more than 6.3 US dollars.

02468

101214161820

2 3 4 5 6 7 8

CER(US$/t_CO2)

IRR

(%

ChartB.12. IRR and CER price

B.4.2. Political barrier

It is projected that the Malaysian Government will not establish any incentives enough to induce palm oilindustry to implement methane recovery and methane gas power generation during the project period.The key political barriers for promotion of methane recovery and methane gas power generation are asfollows:

(1) No Legal or regulatory of methane emission is expected during the project period.(2) Currently applied SREP, which promotes development and use of renewable energy sources, does notand will not provide enough financial and/or economic incentives for the palm oil industry to invest inmethane recovery and methane power generation. As shown in B4-1 of this document, the project wasnot financially feasible even with the income from selling the generated power to public grid (TNB) withpremium price provided under SREP. Apparent political barriers will exist during the project periodagainst the dissemination of methane recovery and methane gas power generation in palm oil industry inthe baseline case.

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B.4.3. Technical barriers

Design, construction and O&M of the sealed digesters require due attention to prevention of gasexplosion. Since such technology and know-how are currently not available in Malaysia, externaltechnical assistance is necessary for Malaysia to introduce and disseminate the proposed technology inpalm oil industry. It means that the proposed technology will not be realized in Malaysia without externaltechnical assistance from developed countries such as Japan. Technical barriers clearly exist in thebaseline case in Malaysia.

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B.5. Description of how the definition of the project boundary related to the baseline methodology is applied to the project activity:

Below figure illustrates the project boundary of this project.

Baseline Scenario

Steriliser Stripper Digester Press

Screen

Settling tank

Desander

Centrifuge

Centrifuge

Vacuum dryer

Nut/Fiber Separator

Nut dryer/cracker

Winnowing Column

Hydrocyclone

Kernel dryer

Press liquor Press cake

Sludge

CPOPOME

Fiber

Shell

EFB

Fuel

CPO Production Process

(6 anaerobic lagoon)

POME anaerobic treatment

Project boundary

Palm Oil Mill

FFB

Sludge(livestock feed)

Effluent discharge to the river

Power plant(Biomas combustion)

Start-upElectric Source

Electricity supplyfor Grid

Onsite use

11

22

55

EFB shredder

Electricity purchase from Grid

plantation

Emissions derived from fossil fuel(Baseline Scenario: Electricity purchase+Project Scenario:Electricity supply for Grid)

(19 lagoons including 2 lagoons with airation)

POME aerobic treatment

ChartB.13 Project Boundary (Baseline Scenario)

Page 17

Steriliser Stripper Digester Press

Screen

Settling tank

Desander

Centrifuge

Centrifuge

Vacuum dryer

Nut/Fiber Separator

Nut dryer/cracker

Winnowing Column

Hydrocyclone

Kernel dryer

Press liquor Press cake

Sludge

CPO

EFB Project boundary

FFB

Project Scenario

EFB shredder

Electricity Supply for Grid

POME

Recoveredbiogas

Methane power generation

44

11

22

33

plantation

Fiber

Shell

Fuel

CPO Production Process

POME anaerobic treatment

Palm Oil Mill

Sludge(livestock feed)

Power plant(Biomas combustion)

Start-upElectric Source

Onsite use

Effluent discharge to the river

Start-upElectric Source

(19 lagoons including 2 lagoons with airation)

POME aerobic treatment

(3 sealed digesting tanks)

ChartB.14 Project Boundary (Project Scenario)

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B.6. Details of baseline development

B.6.1. Date of completing the final draft of this baseline section : 20/01/2004B.6.2. Name of person/entity determining the baseline:

EX Corporation17-22, Takata 2 ChomeToshima-ku, Tokyo 171-0033, Japan

TEL: +81-3-5956-7t503FAX: +81-3-5956-7523Email: [email protected]

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C. Duration of the project activity / Crediting period

C.1. Duration of the project activity:

C.1.1. Starting date of the project activity:

The definition of the starting date of the project activity is the commencement of the both methanerecovery system and the methane power generation plant.

Starting date: 01/01/2006

C.1.2. Expected operational lifetime of the project activity:

Minimum of 21 years

C.2. Choice of the crediting period and related information:

C.2.1. Renewable crediting period (at most seven (7) years per period)

C.2.1.1.Starting date of the first crediting period:

The definition of the starting date of the first crediting period is the commencement of the project activity.

Starting date: 01/01/2006

C.2.1.2.Length of the first crediting period:

7 years

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D. Monitoring methodology and plan D.1. Name and reference of approved methodology applied to the project activity:

No monitoring methodology, which can be applied to this project, has been approved by UNFCCC so far.Therefore, a new monitoring methodology titled below is proposed in the Annex 4 of this PDD

The title: Monitoring Methodology of Methane Recovery from Palm Oil Mill Effluent andRenewable Electricity Generation

D.2. Justification of the choice of the methodology and why it is applicable to the projectactivity:

The monitoring methodology should be applied to this project activity in order to minimise theuncertainty (See Annex3. 5 Assessment of Uncertainty) in estimating the baseline and project emissionswith this project activity. GHGs emission estimated based on the ex-ante assumptions in the baselinemethodology will be reviewed and revised through monitoring of the parameters after commencement ofthe project.

The parameters to be and not to be monitored in this project activity are listed below.

[Baseline emission]• Methane emission from POME treatment

Monitoring parameters: POME generation (POME)COD before anaerobic treatment(COD_before)

Methane emission from POME in the baseline scenario will be all recovered by the project activity.Based on the above parameters to be monitored, CH4_POME(BAU) is estimated by the formula in thebaseline methodology.

• GHGs emission to be substituted by methane gas power generation in the case with the projectMonitoring parameters: Electricity sold (Electricity)

GHGs emission to be substituted by methane gas power generation in the project scenario will beestimated by multiplying the electricity sold to the public grid(TNB) by emission factor of thenational grid average.

[Project emission]• GHG emission from methane combustion

Monitoring parameters: POME generation (POME)COD before anaerobic treatment(COD_before)

COD after anaerobic treatment(COD_after)

The emission amount from methane combustion in the project scenario will be estimated based onthe above parameters to be monitored.

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• The emission amount through transporting of increased FFB in the projectThe emission amount through transporting of increased FFB in the project scenario is involved in themonitoring methodology, however, this monitoring parameter can be omitted in this project, becausethe contract of electricity sales does not guarantee a minimum selling amount of electricity.

• GHG emission from methane power generationMonitoring parameters: Electricity Consumption upon start up(Electricity Consumption)

Number of times of generator’s start up (N)

GHG emission from methane power generation is considered as negligible in this project. Bymonitoring the parameters above, it should be identified that the emission is actually negligible.

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D.3. Data to be collected in order to monitor emissions from the project activity, and how this data will be archived:

ID number Data type Data variable Dataunit

Measured (m),calculated (c) orestimated (e)

RecordingFrequency

Proportion ofdata to bemonitored

How willthe data bearchived?(electronic/paper)

For how longis archiveddata kept?

Measurementmethod

1 FFB Weight FFB received t/d M Monthly 100% Electronic Project lifetime

Manually(voucher check)

2 POME Flow rate POME generation m3/d M Monthly 100% Electronic Project lifetime

Flow meter

3 COD_before Concentration

CODconcentrationbefore POMEtreatment

mg/l M Monthly 100% Electronic Project lifetime

Manually(sample analysis)

4 COD_after Concentration

CODconcentrationbefore POMEtreatment

mg/l M Monthly 100% Electronic Project lifetime

Manually(sampleanalysis)

5 Electricity Electricity Electricitygenerated

Kwh M Continuously 100% Electronic Project lifetime

Automatically

6 Fuel_starup Volume Amount of fossilfuel used for thestart up by theback up powersource.

L M When Back upgenerator isused

100% Electronic Project lifetime

Manually

7 BOD_discharge

Concentration

BOD beforePOME discharge

mg/l M Monthly 100% Electronic Project lifetime

Manually(sampleanalysis)

8 OperatingDays

Days Days of milloperation

M Monthly 100% Electronic Project lifetime

Project lifetime

Manually

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D.4. Potential sources of emissions which are significant and reasonably attributable to the project activity, but which are not included in theproject boundary, and identification if and how data will be collected and archived on these emission sources.

There is no monitoring of leakage necessary in this project.

D.5. Relevant data necessary for determining the baseline of anthropogenic emissions by sources of GHG within the project boundary andidentification if and how such data will be collected and archived.

ID number(Please refer totable 2 Annex4)

Data type Data variable Dataunit

Measured (m),calculated (c) orestimated (e)

RecordingFrequency

Proportion ofdata to bemonitored

How willthe data bearchived?(electronic/paper)

For how longis archiveddata kept?

Measurementmethod

2 POME Flow rate POME generation m3/d M Continuously 100% Electronic Project lifetime

Flow meter

3 COD_before Concentration

COD beforePOME treatment

mg/l M Weekly 100% Electronic Project lifetime

Manually(sample)

D.6. Quality control (QC) and quality assurance (QA) procedures are being undertaken for data monitored. (data items in tables contained insection D.3., D.4. and D.5 above, as applicable)

ID number(Please refer to table 2

Annex4)

Uncertainty level of data(High/Medium/Low)

Are QA/QC proceduresplanned for these data?

Outline explanation why QA/QC procedures are or are not being planned.

1 FFB Low Yes Methane emissions will be calculated based on this FFB data.Payment slips in the palm oil mill is used. These slips are usually used for statisticslike the calculation of palm oil production ,data credibility is high.

2 POME Low Yes POME data is the key factor of the calculation of baseline methane emissions andcarbon dioxide emission from methane combustion in the project scenario.Data reliability should be assured by continuous measuring with precise measuringdevices,

3 COD_before Low Yes This data is needed in order to calculate baseline methane emissions and carbondioxide emission from methane combustion in the project scenario.Data reliability should be assured by increasing the frequency of measurement andby using precise measuring devices.

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4 COD_after Low Yes This data is needed in order to calculate carbon dioxide emission from methanecombustion in the project scenario.Data reliability should be assured by increasing the frequency of measurement andby using precise measuring devices.

5 Electricity Low Yes Electricity replaced by methane power generation will be calculated based on thisdata.Data reliability should be assured by continuous measuring with precise measuringdevices,

6 Fuel_backup Low Yes This data will be monitored in order to calculate the carbon dioxide emission fromstart up of methane power generation facility.By measuring actual diesel fuel consumption when using spare power source, dataliability is assured.

7 BOD_discharge Low Yes This data will be monitored to check the discharged water in the project scenariomeets the effluent standard.Data will be assured by increasing the frequency of measurement and by usingprecise measuring devices.

8 Operating date Low Yes Operating date will be monitored to check consistency of the actual operation andassumptions of the project design document.

D.7. Name of person/entity determining the monitoring methodology:

Ex Corporation17-22, Takata 2 ChomeToshima-ku, Tokyo 171-0033, Japan

TEL: +81-3-5956-7t503FAX: +81-3-5956-7523Email: [email protected]

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E. Calculation of GHG emissions by sourcesE.1. Description of formulae used to estimate anthropogenic emissions by sources of greenhousegases of the project activity within the project boundary:

E.1.1. Emission from methane combustion

CO2 emission from methane combustion for power generation can be give n by solving the followingequation. (see E4.2 on the estimation method of CH4 i (Project)_POME(t).)

CO2_combustion(t_CO2)= CH4 i (Project)_POME(t) ×44/16= 2,604(t_CO2)

E.1.2. Emission from start up of methane power generation facility

At the time of starting up the generator, external power sources such as batteries are required for the firsttime of operating the generator. From the second time of operation, however, the facility can start byusing the battery, which accumulates the electricity during the operation. Therefore, the amount of GHGupon start up of the facility is estimated to be negligible and not included in the calculation of GHGs inthe project case.

E.2. Description of formulae used to estimate leakage, defined as: the net change ofanthropogenic emissions by sources of greenhouse gases which occurs outside the project boundary,and that is measurable and attributable to the project activity:

There is no leakage having a great impact on the amount of GHGs emission by the project

E.3. The sum of E.1 and E.2 representing the project activity emissions:

The project activity emission is 2,604(t_CO2).

E.4. Description of formulae used to estimate the anthropogenic emissions by sources ofgreenhouse gases of the baseline:

E.4.1. GHG Emission from POME

GHG Emission from POME is determined in the following steps

[STEP1]:Estimation of POME generationNecessary parameters・Methane weight per unit volume : a (t/m3)・Annual FFB received : FFBi(BAU) (t/y)・Annual POME generation : POMEi(BAU) (m3/y)・Amount of CPO produced per unit FFB : R_(FFB→CPO) (t_CPO/t_FFB)・ Amount of POME generated per unit CPOproduction

: R_(CPO→POME) (m3_POME/t_CPO)

・Biogas generation per POME : R_(POME→BIOGAS) (m3_Biogas/m3_POME)・Methane content in the biogas : R_(BIOGAS→METHANE) (m3_Methane/m3_Biogas)・Global warming potential Methane : GWP(CH4)

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Step1.1. Estimation of annual FFB received

Assuming FFB received in the BAU during project period is determined according to the historical trend,FFB received (FFBi_BAU) will be estimated based on the past record over a few years. If enough numberof the data is not available for the prediction, the lowest actual amount received will be applied as theamount of FFB received in the BaU scenario in accordance with the conservativeness policy.

FFBTotal(BAU) = ∑=

7

1iFFB i(BAU) (t)

=1,438,605(t)

ChartE.1. Actual FFB received amountYear FFB Received (t/y)2002 205,5152003 246,555

Minimum value 205,515

Since the data of the amount of FFB received in the project mill is only available for the year 2002 and2003, the project applies the lower amount of FFB received in the year 2002 in accordance with theconservativeness policy. The project also assumes that the amount of FFB received will not changeduring the project period.

ChartE.2. Estimated FFB received amount (project period 7 years)Year FFB Received (t/y)2006 205,5152007 205,5152008 205,5152009 205,5152010 205,5152011 205,5152012 205,515Total 1,438,605

FFBTotal(BAU) = ∑=

7

1iFFB i(BAU)= 205,515(t/y)×7(y) = 1,438,605 (t)

Step1.2. Estimation of CPO extraction rate (R_(FFB→ CPO) )from FFB

According to Malaysian Oil Palm Statistics 2002, CPO extraction rate from FFB changes as shown in thechart E.3. The project adopts the average oil extraction rate for the past ten years for the parameters ofestimating GHGs emission from the project.

R_(FFB→CPO) ={∑=

10

1i Ri_(FFB→CPO) }/10

= 0.189 (t_CPO/t_FFB)

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16.0%

17.0%

18.0%

19.0%

20.0%

21.0%

22.0%

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

ChartE.3. Yearly Change of Oil Extraction Rate

ChartE.4. Yearly Change of Oil Extraction RateYear OER1993 18.7%1994 18.6%1995 18.5%1996 18.7%1997 19.0%1998 18.9%1999 18.6%2000 18.9%2001 19.1%2002 19.9%Mean 18.9%

Step1.3. Estimation of annual CPO production (CPOi_BAU) in the baseline scenario

CPO production can be calculated as the result of multiplying the annual FFB received by palm oilextraction rate (OER). Annual CPO production in the year ican be calculated by the following formula.

CPOi(BAU) = FFBi(BAU) ×R_(FFB→CPO)

    = 0.189× FFBi(BAU) (t_CPO/year)

Step1.4. Estimation of POME generation rate (R_(CPO→POME) ) from CPO

According to Palm Oil Research Institute of Malaysia (PORIM), Malaysia has its own country factor ofPOME generation per unit of CPO, which is also used in the official estimation of methane emission fromPOME in ”Malaysia National Greenhouse Gas Inventory 1994”. Therefore, the project also adopts thisvalue GHGs estimation.R_(CPO→POME)=2.5 (m3_POME/t_CPO)

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Step1.5. Estimation of annual POME generation (POMEi_BAU)

POME generation can be calculated as the result of multiplying the mount of CPO production (t_CPO) byPOME generation rate(m3_POME/t_CPO). Therefore, the annual POME generation in the year i can becalculated by the following formula.

POMEi(BAU)=CPOi(BAU) ×R(CPO→POME)

=FFBi(BAU)× R_(FFB→CPO)×R(CPO→POME)

=FFBi(BAU)×0.189×2.5=0.473× FFBi(BAU)

[Step2]:Estimation of methane generation per unit volume of POME

Methane generation per unit of POME is estimated based on Annex 3.

Required parameters・Removal of COD per unit volume of POME : ∆COD(kg)・COD concentration of unit of POME before anaerobic treatment : CODbefore(mg/l)・COD concentration of unit of POME after anaerobic treatment : CODafter(mg/l)・COD Removal Efficiency : RemovalEfficiency・Maximum CH4 producing Capacity : Bo (kg_CH4/kg_COD)・Estimated actual CH4 production : B (kg_CH4/kg_COD)・Water Depth Factor : WaterDepthFactor・Methane conversion factor : MCF

・Weight per unit volume of methane : a(t/m3)・Temperature : T(℃)・Volume of gas : V(l)・Volume of gas (standard temperature and pressure) : Vo(l)・Biogas generation per unit volume of POME : R_(POME→BIOGAS)

(m3_Biogas/m3_POME)・Methane concentration in the Biogas : R_(BIOGAS→METHANE)

(m3_Methane/m3_Biogas)

Step2.1. Estimation of removed COD per unit of POME by the anaerobic fermentation

This project corresponds to the case 2 in the Annex 3. The removed COD per unit of POME can becalculated as the product of COD concentration per unit of POME before anaerobic treatment and CODremoval efficiency as shown in the equation below. As to the COD removal efficiency, the study applies85%, which is a little bit lower than the baseline case since scientifically reliable data is not currentlyavailable in Malaysia.

∆COD(kg/m3) = CODbefore (mg/l) ×10-6×Removal Efficiency=52.7(kg/m3)

ChartE.5. CODbefore and Removal Efficiency in the project millItem Value SourceCODbefore 53,816(mg/l) Data from millRemoval Efficiency 85% Data from mill

Step2.2. Setting up of the maximum methane generation capacity(Bo)

Page 29

The Study applies IPCC’s default value of 0.25.

Bo = 0.25

Step2.3. The estimated actual methane production (B)

Baseline scenario

B in the baseline scenario is calculated by the following formula using the above figures.

B(BAU) = R_(POME→BIOGAS) ×R_(BIOGAS→METHANE)×a÷∆ COD= 24(m3_Biogas/m3_POME)×0.58×6.50×10-4(t/m3)÷(0.05(t/m3)×0.85)= 0.213 (kg_CH4/kg_COD)

Project scenario

B in the project scenario is calculated by the following formula using the above figures.

B(Project) = R_(POME→BIOGAS) ×R_(BIOGAS→METHANE)×a÷∆ COD= 24(m3_Biogas/m3_POME)×0.65×6.50×10-4(t/m3)÷(0.05(t/m3)×0.90)= 0.225 (kg_CH4/kg_COD)

Step2.4. The Methane conversion factor

Taking into account that the water depth of the existing lagoon in the project mill is 6 meter while theplanned sealed digester tank will have the depth of 10 meter in the project, the methane conversion factoris estimated as follows for each case.

Baseline scenario

MCF(BAU) = 0.85

Project scenario

MCF(Project)  = 0.90

0.21

0.43

0.64

0.85 0.85

0.00

0.25

0.50

0.75

1.00

0 2 3 4 5 6 7

Lagoon depth (m)

MC

F

ChartE.6. MCF of lagoon

Page 30

Step2.5. Estimation of methane generation per unit volume of POME

Methane generation per unit of POME (CH4_POME)) can be calculated by the following formula using Step2.1 to step 2.3 above.

Baseline Scenario

Methane generation per unit of POME (t_CH4/m3_POME)=∆COD(kg m3) ×Bo(BAU) (kg_CH4/kg_COD)×MCF(BAU)

=45.7(kg/m3)×0.25(kg_CH4/kg_COD)×0.85=9.74(kg_CH4/m3_POME)

Methane emission(CO2 equivalent) per unit of POME (t_CO2/m3_POME))=∆COD(kg) ×Bo(BAU) (kg_CH4/kg_COD)×MCF(BAU)×GWP(CH4)

=45.7 (kg/m3)×0.25 (kg_CH4/kg_COD)×0.85×21=204.5(kg_CO2/m3_POME)

Project Scenario (Estimated value of methane generation in the project scenario will be used in step3.)

Methane generation per unit of POME (t_CH4/m3_POME)=∆COD(kg) ×Bo(Project) (kg_CH4/kg_COD)×MCF(Project)

=45.7 (kg/m3)×0.25 (kg_CH4/kg_COD)×0.9=10.31(kg_CH4/m3_POME)

[STEP3]:Estimation of GHG emission from POME

Based on annex3, annual methane emission during the project period can be calculated by the followingformula.

Baseline Scenario

CH4(BAU)_POME

= ∑=

7

1iPOMEi(BAU) ×CH4 /POME

=0.473× ∑=

7

1iFFBi(BAU)×9.74

= 0.473× 205,515×7×9.74=6,627(t_CH4)

Therefore GHG from POME is as follows.GHG(BAU)_POME

=∑=

7

1i CH4 i_POME×GWP(methane)

=6,627×21=139,167(t_CO2)

ChartE.7. Baseline GHG emission from POME treatment (anaerobic lagoon)

Page 31

Year Methane emission (t/y) GHG emissionCO2_eq(t/y)

2006 947 19,8802007 947 19,8802008 947 19,8802009 947 19,8802010 947 19,8802011 947 19,8802012 947 19,880Total 6,627 139,167

Project Scenario (Estimated value of methane generation in the project scenario will be used in step 3.)

Because all the generated methane is recovered and used in power generation in the project scenario,emission is zero. Methane recovery used in the step 3 is calculated in the following formula.

CH4 (Project)_POME

= ∑=

7

1iPOMEi(BAU) ×CH4 /POME

=0.473× ∑=

7

1iFFBi(BAU)×10.31

= 0.473× 205,515×7×10.31=7,014(t_CH4)

E.4.2. GHG emissions from fossil fuel based power generation that will be substituted by methanepower generation by the project

Methane power generation by the project will contribute to the following two types of fuel substitutions. -Substitution of purchasing electricity by methane power generation by the project mill -Substitution of fossil fuel based power generation by selling electricity generated form methanegas power generation to the public grid

By realizing the above fuel substitution, the project will avoid GHGs emission which will occur in thebaseline case. The amount of GHGs emission to be avoided by the above fuel substitution in the projectis estimated below.

Necessary parameters・COD Removal amount : ∆COD(kg)・Maximum CH4 Producing Capacity : Bo(Project) (kg_CH4/kg_COD)・CH4 conversion factor(Anaerobic level) : MCF(Project)

・Weight per unit volume of methane : a(t/m3)・Annual Methane recovery in the project scenario : CH4(Project)_POME

・CO2 emission coefficient of power grid : EF(GRID→CO2) (kg/kWh)・CH4 emission coefficient of power grid : EF(GRID→CH4) (kg/kWh)・N2O emission coefficient of power grid : EF(GRID→N2O) (kg/kWh)・Global warming potential of CH4 : GWP(CH4)

・Global warming potential of N2O : GWP(N2O)

・Heat value of methane : HV_Methane(MJ/kg)

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・Annual operation time : OperationHours(h/y)・Conversion factor from joule to watt-hour : CF(joule→watt-hour)

・Power generation efficiency : Efficiency・Electric power : Electricityi_generated(MWh/y)

[Step1]:Estimation of methane recovery in the project scenario

Methane generation in the project scenario is estimated with the same method as 6.2.1. In the projectscenario, the sealed digester will be constructed for anaerobic fermentation of POME.

CH4(Project)_POME

= ∑=

7

1iPOMEi(Project) ×∆COD(kg) ×Bo (kg_CH4/kg_COD)×MCF(Project)

=1,002(t_CH4)

[Step2]:Production of electricity from methane gas power generation (Electricity_generation)

Generated Electricity from methane power generation can be calculated in the following formula bymaking use of Heat value of methane (HV_Methane), conversion factor from calorific value to powergeneration (CF(joule→watt-hour)) and power generation efficiency (Efficiency).

Electricity_generated

= ∑=

7

1i CH4(Project)_POME (t) × HV_Methane(MJ/kg)×CF(joule→watt-hour) (kWh/MJ)× Efficiency

=7,014 (t)×5.5×10-3 (MJ/t)×0.2778 (kWh/MJ)×0.25= 27,035 (MWh)

ChartE.8. Project scenario GHG emission from POME treatment (sealed digesting tank)Year Methane emission

(t/y)Electricity Generation

(MWh)Electricity Generation※

(kW)2006 1,002 3,862 5362007 1,002 3,862 5362008 1,002 3,862 5362009 1,002 3,862 5362010 1,002 3,862 5362011 1,002 3,862 5362012 1,002 3,862 536Total 7,014 27,035 -

※ Total operating hour: 24(hours/day)×300(days) =7,200(h/y) Remained 65 or 66 days are for maintenance. The plant operates 25 days per month.

[Step3]: Estimation of GHGs emission to be avoided by implementation of the project

GHG emission to be avoided through fuel substitution to methane gas power generation by theproject(GHG_substitute) is estimated by using the following emission coefficient in this section. In this case,LossRatio_project can be considered negligible, as the distance from the power plant to the TNB substationis only 200m and its transmission loss is expected very little comparing to the loss of electricity to bereplaced. Therefore, for simplicity, neither LossRatio_project nor LossRatio_replaced will be counted in thisproject, which is conservative.

Page 33

CO2_substitute = ∑=

7

1i Electricityi_generated×(1‐LossRatio_project)÷(1‐LossRatio_replaced)×EF(GRID→CO2)

=27,035 (MWh) ×(1‐0)÷(1‐0)×6.24×10-1(t/MWh)= 16,843(t_CO2)

CH4_substitute = ∑=

7

1i Electricityi_Generated×(1‐LossRatio_project) ÷(1‐LossRatio_replaced)×EF(GRID→CH4)

×GWP(CH4)

=27,035 (MWh)×(1‐0) ÷(1‐0)×2.81×10-6×21 (t/MWh)= 1.6(t_CO2)

N2O_substitute = ∑=

7

1i Electricityi_Generated×(1‐LossRatio_project) ÷(1‐LossRatio_replaced)×EF(GRID→

N2O) ×GWP(N2O)

=27,035 (MWh) ×(1‐0) ÷(1‐0)×3.74×10-6 ×310(t/MWh)= 31.3(t_CO2)

GHG_substitute = CO2_substitute+ CH4_substitute+ N2O_substitute= 16,843+1.6+31.3= 16,876 (t_CO2)

ChartE.9. Emission factor of average grid mix (2000)GHG Parameter Emission FactorCO2 EF(GRID→CO2) 6.24×10-1 kg/kWhCH4 EF(GRID→CH4) 2.81×10-6 kg/kWhN2O EF(GRID→N2O) 3.74×10-6 kg/kWh

Data source: Feasibility Study on Grid Connected Power Generation Using Biomass Cogeneration Technology (Pusta Tenaga Malaysia, 2000)

E.4.3. GHG emission in the baseline scenario

GHG(BAU)TOTAL = GHG(BAU) POME + GHG_Substitute=139,161 +16,876=156,037 (t_CO2)

E.5. Difference between E.4 and E.3 representing the emission reductions of the project activity:

CDM Executive Board advises that the sources from which GHGs emissions are same between baselineand project scenarios can be excluded from the estimation.In the case of the current project, no additional GHGs emission will arise in comparison with the baselinescenario. Thus, GHG reduction (GHG_reduction) in this project is estimated as shown below.

GHG(BAU)TOTAL - GHG(Project)TOTAL = 156,037-18,228= 137,809 (t_CO2)

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E.6 Table providing values obtained when applying formulae above:

Chart E.10 shows the baseline and project emission as well as the estimated reduction of GHGs by theproject.

The current project assumes that the annual operation days of the palm oil mill, methane fermentationfacility and electricity generation facility are 300 days while the remaining days are to be kept formaintenance of these facilities. During the period of maintenance, the methane gas that may exceed thecapacity of the gasholder will be released to the atmosphere after combustion. The amount of methanegas to be released during maintenance of the sealed fermentation tank is also estimated to be little enoughto ignore.

ChartE.10. Emission Reduction with the project activityProject emission

(t_CO2eq)Baseline emission

(t_CO2eq)Emission Reduction

(t_CO2eq)2006 2,604 22,291 19,6872007 2,604 22,291 19,6872008 2,604 22,291 19,6872009 2,604 22,291 19,6872010 2,604 22,291 19,6872011 2,604 22,291 19,6872012 2,604 22,291 19,687Total 18,228 156,037 137,809

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F. Environmental impacts

F.1. Documentation on the analysis of the environmental impacts, including transboundary impacts

The Environmental Quality Act of 1974 in Malaysia requires the environmental impact assessment (EIA)to the development of power generation facility with the capacity of more than 30MW while the methanegas power generation facility to be built in the project only has the capacity of 0.7MW. Therefore, EIA isnot required for the current project/

F.2. if the project participants or the host Party considers impacts significant:

Environmental impacts are not considered significant.

G. Stakeholders comments

Interview for the stakeholders will be conducted later.

G.1. Brief description of the process on how comments by local stakeholders have been invited andcompiled:

G.2. Summary of the comments received:

G.3. Report on how due account was taken of any comments received:

Page 36

Annex 1

CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITYOrganization: EX CorporationStreet/P.O.Box:Building:City: 17-22 Takada 2 Chome Toshima-kuState/Region: TokyoPostfix/ZIP: 171-0033Country: JapanTelephone: +81-3-5956-7503FAX: +81-3-5956-7523E-Mail:URL: http://www.exri.co.jpRepresented by:Title: General ManagerSalutation: Mr.Last Name: SuzukiMiddle Name:First Name: ShinichiDepartment: Environmental and Social Planning DivisionMobile:Direct FAX:Direct tel: +81-3-5956-7514Personal E-Mail: [email protected]

Organization: Project Mill (Specific information cannot be disclosed)Street/P.O.Box:Building:City: Kuala LumpurState/Region: SelangorPostfix/ZIP: 43800Country: MalaysiaTelephone:FAX:E-Mail:URL:Represented by:Title:Salutation:Last Name:Middle Name:First Name:Department:Mobile:Direct FAX:Direct tel:Personal E-Mail:

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Annex 2

INFORMATION REGARDING PUBLIC FUNDING

No public funding is involved in this project activities.

Page 38

Annex 3

NEW BASELINE METHODOLOGY

1. Title of the proposed methodology:

Baseline Methodology of Methane Recovery from Palm Oil Mill Effluent and RenewableElectricity Generation

2. Description of the methodology:

2.1. General approach□□ Existing actual or historical emissions, as applicable;

□□ Emissions from a technology that represents an economically attractive course of action,taking into account barriers to investment;

□□ The average emissions of similar project activities undertaken in the previous five years,in similar social, economic, environmental and technological circumstances, and whose performance isamong the top 20 per cent of their category.

As to the general approach, the project selects 48a of the Marrakesh Accord.

2.2. Overall description (other characteristics of the approach):

2.2.1. Applicable ConditionsThis methodology is applicable if the project complies with the following conditions.

• Scale of enterprise: Relatively small-scale palm oil companies that operates less than 10 facilities.• Current treatment of POME: Combination of the anaerobic and aerobic lagoon processes.• Project Components: Recovery of methane from POME and power generation with the recovered

methane gas for in –factory use and selling to the external grid.

Conservativeness policy on the MethodologyThis Methodology is specifically proposed for the CDM project in small-scale palm oil factories. Large-scale palm oil enterprises that operate extensive plantations and many factories usually have enough datarequired for projection of GHGs emission and can control the amount of FFB received. On the contrary,small-scale palm oil factories neither have enough data for projection of GHGs emission nor control theamount of FFB received due to no ownership of oil palm plantation in most of the cases. Therefore, theuncertainty factors will be higher in the case of small factories than in large factories if the CDM projectis implemented with the target of methane recovery and power generation in oil palm factories.

However, to positively encourage the CDM projects among the small-scale enterprises, this methodologyadopts conservative values, as a basic policy, if uncertainty factors are large enough to estimate GHGsemissions.

2.2.2. Summery of Methodology

This project aims at reduction of GHGs emission can achieve reducing of the greenhouse by thefollowing activities:• Recovery of methane by conversion of effluent (POME) treatment method in the palm oil mill.

(Component A)

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• Power generation by recovered methane gas (Component B)

Types of GHGs to be reduced by the above project components are as follows:

[Component A]• Methane gas generated from palm oil mill effluent (POME)

[Component B]• GHGs emission from power generation that will be substituted by methane gas power generation

within the mill by the project.Although palm oil factories usually have their own power generators using the solid residuegenerated in the process of palm oil production for fuel, some of them also purchase power fromexternal sources including public grid. If the methane gas power generation substitutes some of thepower provided by the grid, GHGs emission from combustion of fossil fuels to produce thecorresponding power substituted can be included as the reduction amount of GHGs resulting fromthe project.- Reduction amount of GHGs will be calculated based on the emission coefficient of the power

generation sources, from which the mill purchases the electricity.- If the power supply is made by public grid, its average emission factor of GHGs will be applied

to estimate GHGs emission to be reduced by the above project activities.

• GHGs emission from power generation that will be substituted by methane gas power generationthrough trading of surplus electricity (in the case of selling to the public grid):If the surplus electricity from methane gas power generation in the mill is sold to the public grid,GHGs emission from combustion of fossil fuels to produce the corresponding power substituted canbe included as the reduction of GHGs emission resulting from the project. In this case, the averageemission factor of GHGs from power generation by the public grid is applied to estimate GHGsemission to be avoided by the project.

• GHGs emission from power generation that will be substituted by methane gas power generationthrough trading of surplus electricity (in the case of selling directly to nearby power users)If the surplus electricity from methane gas power generation in the mill is sold directly to nearbypower users, GHGs emission from combustion of fossil fuels to produce the corresponding powersubstituted can be included as the reduction of GHGs emission resulting from the project. In thiscase, the emission factor of GHGs emission is estimated on the basis of fuel combination applied forpower generation at the power plant from which the electricity is supplied to the above nearby users.

2.2.3. Baseline scenario and Additionality determination

Comparison of various POME Treatment SystemsA general POME process consists of primary anaerobic digestion process and subsequent aerobicdigestion process at aerobic lagoons. The anaerobic digestion process is mainly categorized described as3 types, namely, the anaerobic lagoon system, the open digestion tank system, and the sealed digestionsystem. some facilities sometimes install a combination process (anaerobic lagoon system + opendigestion tank system) as well. The most widely applied POME process is the anaerobic lagoon system.The table below outlines the characteristics of various POME treatment process.

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Chart2.1. Characteristics of POME treatment systemTreatment System Grade CommentAnaerobic lagoon △

Open digester tank ○

Requiredarea

Sealed digester tank ○

- Lagoon: vast land is needed (1,000 m2~20,000m2 /lagoon)- Tank: land required is less (several hundreds m2/tank)

Anaerobic lagoon △

Open digester tank ○

TreatmentEfficiency

Sealed digester tank ○

- Retention time control: tank system can be controlled easier.- Efficiency: in general, a tank is equivalent to 2 lagoons- Lagoon: more BOD and COD can be degraded with additional

lagoons or longer retention time.Anaerobic lagoon ×

Open digester tank ×

Biogasrecovery

Sealed digester tank ○

- Biogas can be recovered only with sealed digesting tanksystem.

Anaerobic lagoon ○

Open digester tank △

ConstructionCost

Sealed digester tank ×

- Lagoon: excavating work only- Open tank: Construction of steel tank. The cost is higher than

that of lagoon.- Sealed tank: Initial cost is very high. (cost to ensure the air

tightness, installation cost of such as piping for efficientretention process and safety facilities, and construction cost ofa body steel tank.)

Anaerobic lagoon ○

Open digester tank ○

Maintenance

Sealed digester tank ×

Anaerobic lagoon ○

Open digester tank ○

Safety

Sealed digester tank △

- Sealed tank: safe control in order to prevent gas explosion isnecessary.

Determination of the Baseline ScenarioCheck items for determining the base line scenario, taking into account national and/or sectoral policiesand circumstances and the comparative chart above, are described as following.

[Check item A]• Is the current POME process a combination of the anaerobic and aerobic open lagoon method?

In order to apply this methodology, it is necessary that the current treatment system should be thecombination of anaerobic and the aerobic lagoon. If any other system is adopted this methodologycannot be applied.

[Check item B]• Are there any policy incentives now available or to be available some time in future that encourage

or induce palm oil factories to reduce methane emissions from POME or employ methane gas powergeneration?

If some strong policy incentives such as strict methane emission control with penalties or fines orenough subsidy to cover additional investment, introduction of sealed digester tanks or methane gasgeneration facilities will be realized in the baseline scenario. In this case, the project will not besubject to CDM. Confirming the existence of such policy incentives constitutes the verification ofpolitical barriers against the project.

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[Check item C]• Is the methane gas power generation likely to be technically as well as economically feasible without

CDM?

In many cases, the cost of methane recovery tanks and methane gas generators are higher than therevenue from generated electricity by selling it to the grid or end-users. Therefore, the proposedproject is estimated not economically feasible. Additionally, operation of anaerobic digester requirestechnical expertise especially for safety control of possible gas explosion. If the above technologyand technical expertise are available in the host country as well as the project itself is economicallyfeasible without CDM, the project should be included in the baseline scenario. Therefore, theseeconomic and technical barriers against the project need to be verified so that the proposed projectwill only be realized under CDM.

[Check item D]• Is the stricter effluent standard likely to be employed during the project period?

Since many of palm oil factories are located at remote unpopulated area surrounded by plantations, itis unlikely that the current effluent standard will be tightened during the project period. Therefore,the current POME treatment method of anaerobic lagoon can be defined as the baseline while theproposed project can be defined additional to the baseline.

Determination of Additionality

Barriers, which explain why a project will not be implemented as a part of the baseline scenario, are listedbelow. Additionality of a project will is established if the barriers are identified.

• Economical barrier:- Installation of the sealed digester tank and its proper operation with strict safety management

requires a large initial and operation cost. The proposed project will not be economically feasiblewithout CDM even though methane gas is recovered for power generation and sold to public gridor end users. Feasibility analysis of the proposed project (Estimation of internal rate of return: IRR,etc.)

• Political barrier:Policy incentives will not be realized to induce palm oil industries to recover the methane gas andgenerate the electricity.

- Laws and regulations with penalties- Provision of subsidy to secure feasibility of the investment in sealed digester tanks or methane gas

power generators.

• Technical barrier:With regard to design, operation and maintenance of the sealed digester, the greatest attention has

to be paid to safety management so as to prevent gas explosion. Therefore, if proper technologiesare not available about sealed digester or methane gas power generation, it is estimated that there aredefinite technical barriers in Malaysia to realize the proposed project. Necessity of technologytransfer for construction of sealed digesters- Necessity of technology transfer for safe operation of sealed digesters and methane gas generators.

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Decision treeThe decision tree for determination of the baseline scenario and additionality is shown as follows.

YesNo

Sealed digesting tank +

Power Generation

Baseline scenarioshould be reviewed

No

No

Yes

Yes

[Check Item B]Are there any policy incentives now availableor to be available some time in future thatencourage or induce palm oil factories toreduce methane emissions from POME oremploy methane gas power generation?

[Check Item C]Is the project likely to be financiallyfeasible enough without CDM?

[Check Item D]Is the stricter effluent standardlikely to be employed during theproject period?

[Check Item A]Is the current POME treatment system acombination of anaerobic and aerobic lagoonmethods?

Sealed digesting tank +

Power Generation

Opendigesting tankor

Anaerobic lagoon

Project is applicable and additional

No Yes

Chart.2.2. Decision tree

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3. Key parameters/assumptions (including emission factors and activity levels), and data sourcesconsidered and used:

3.1. Assumptions

• The following data set is enough available to project generation of POME- Generation data of POME for the past several years- Data of receiving amount of FEB and etc.

• Official power supply data is available for each type of power sources (if the project substitutes someof power supplied by the public grid.)

3.2. Key Parameter & Data Source

• Emission Factor (Type of electricity to be substituted by the project)):- If the mill consumes the power from the public grid, official data may be available in host

countries. If not, it needs to be estimated in the form of the average emission factor of the totalnational grid power sources.

- If the mill consumes specific power source, the emission factor is estimated based on the types offuels or energies used at the specific power source.

• Emission Factor(Start-up power source):GHGs emission from start-up power sources will be estimated based on the emission factors of thefuels/energy utilized for those power sources, which will be available from the national GHGsinventories in host countries or some other reliable information sources. Default IPCC emissionfactor may be used if the above information is not available in the host countries.

• Emission Factor (Biogas Power generation):The amount of GHGs emission from methane gas electricity generation will be estimated based onthe country–specific emission factors available in the National GHGs Inventory in the host countriesor quasi-official data. The Default IPCC emission factor will be if no such data is available.

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4. Definition of the project boundary related to the baseline methodology:

The area enclosed by the dot line in Chart4.2, and Chart4.3 is defined as the project emission, includingthe process of FFB transportation, overall palm oil production process (CPO production process, POMEtreatment process, up until the effluent discharge point to the river), and end users of the generatedpower.

① GHGs emission from the transport of incremental FFB received by the project:- CO2 emission is not counted since, as specified by UNFCCC, estimation of GHGs emission can be

omitted if the conditions of transport is similar between baseline and project scenarios.- There will be no change in GHGs emission resulting from the increase in transportation distance of

FFB in this project since the condition of FFB reception and transport is similar between baselineand project scenarios.

② GHGs emission from POME treatment process:- GHGs emission from POME treatment facility (anaerobic lagoons and open-air digester tank) CO2

emission is not counted since the above process is carbon-neutral- N2O emission is not counted since almost no emission arises in the process according to the result

of relevan literature survey.

③ GHGs emission from methane combustion:- GHGs emission from methane combustion in the project scenario.- The emission of CO2 from combustion of the recovered methane for power generation is included

as the project emission.- N2O emission is not counted since it is estimated negligible.- CH4 emission is not counted since it is estimated negligible.

④ GHGs emission from the power generation for start-up of the methane gas power generator:- GHGs emission from power generation for start-up of the methane gas power generation facility in

the project scenario.- Estimation will be omitted if the amount of GHGs emission is small enough to ignore.

⑤ GHG emissions from the power generation to be replaced by the methane gas power generation inthe project scenario:

- If the methane gas power generation is employed and used as the alternative power source in theproject scenario, the GHGs emission from the fossil fuel power generation that will be replaced bythe methane gas power generation in the project scenario will be counted as the baseline emission.

The table below indicates the sources of GHGs and those subject to estimation of their emissions. Asprovided in UNFCCC, the emissions of GHGs that are similar between baseline and project scenario areallowed to be omitted.

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Chart4.1. Emission amount of GHG and Counts status within the boundaryBaseline Scenario Project Scenario

included as emitted GHG included as emitted GHG

CO2

No,- Because no FFB increment is expectedby the project. This is conservative.

N2O

No,- Because no FFB increment is expectedby the project. This is conservative.

CH4

No,- Because no FFB increment is expectedby the project. This is conservative.

CO2

No count,- Because CO2 emitted from biomass isdefined carbon neutral by IPCC guidelines.

No count,- Because CO2 emitted from biomass isdefined carbon neutral by IPCC guidelines.

N2O

NegligibleNo,- Because it is negligiblly small, if any, willbe recovered..

CH4

YesNo,- Because it is recovered and utilized asfuel.

CO2

Yes,- In order not to dounble count emissionreduction.

N2O

No,- Because it is assumed negligiblly small.

CH4No,- Because it is assumed negligiblly small.

CO2 Yes

N2O Yes

CH4 Yes

CO2 Yes

N2O YesCH4 Yes

N/A

GHG

①Emission from transportation of increaseof FFB received

N/A

No. Source

⑤Fossil origin GHG emission (CO2, N2O,CH4) substituted by methane powergeneration

N/A

② GHG (CH4) Emission from POME

③ Emission from methane combustion N/A

④Emission from start up of methane powergeneration facility

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Baseline Scenario

Steriliser Stripper Digester Press

Screen

Settling tank

Desander

Centrifuge

Centrifuge

Vacuum dryer

Nut/Fiber Separator

Nut dryer/cracker

Winnowing Column

Hydrocyclone

Kernel dryer

Press liquor Press cake

Sludge

CPO

Fiber

Shell

EFB

Fuel

CPO Production Process

Project boundary

Palm Oil Mill

FFB

Sludge(livestock feed)

Effluent discharge to the river

Power plant(Biomas combustion)

Start-upElectric Source

Electricity supplyfor Grid

Onsite use

On-site use

Electricity purchase from Grid

plantation

Emissions derived from fossil fuel(Baseline Scenario: Electricity purchase+Project Scenario:Electricity supply for Grid)

11

55

POME(anaerobic lagoon)POME anaerobic treatment 22

(aerobic lagoons)

POME aerobic treatment

Chart4.2. Project Boundary(Baseline Scenario)

Page 47

Steriliser Stripper Digester Press

Screen

Settling tank

Desander

Centrifuge

Centrifuge

Vacuum dryer

Nut/Fiber Separator

Nut dryer/cracker

Winnowing Column

Hydrocyclone

Kernel dryer

Press liquor Press cake

Sludge

CPO

EFB Project boundary

FFB

Project Scenario

Electricity Supply for outside

Methane power generation

plantation

Fiber

Shell

Fuel

CPO Production ProcessPalm Oil Mill

Sludge(livestock feed)

Power plant(Biomas combustion)

Start-upElectric Source

Onsite use

Effluent discharge to the river

Start-upElectric Source

44

33POME

Recoveredbiogas

POME anaerobic treatment

(aerobic lagoons)POME aerobic treatment

(sealed digesting tank)

11

Chart4.3. Project Boundary (Project Scenario)

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5. Assessment of uncertainties:

• National and/or sectoral environmental policyUncertainty about the future environmental laws and regulations in the host country: There are somepossibilities of policy changes in environmental laws and regulations such as forest logging control intropical forest countries and tightening of effluent standard in response to the progress of urbanization. Ifsuch environmental policies are implemented, the land availability will be much limited. Such limitationin land use will induce installation of open-air digester tank and the proposed project with the sealeddigester tank will not be realized. In this case the proposed project is excluded from the subject of thismethodology. In addition, if a policy incentive, which is strong enough to induce palm oil industry toestablish methane gas power generation facilities, is introduced, the proposed project may also beexcluded from the subject of CDM. (see 2.2.3.determination of additionality)

• FFB received amount  a. Baseline scenarioSince the amount of FFB harvest fluctuates year by year, it is difficult to forecast how much FFBwill be received by the palm oil factories. Although this methodology estimates the amount of FFBreceived based on its past annual records, such records may not be sufficiently available especially inthe small palm oil factories. If the available data is not enough to forecast the amount of FFBreceived, the minimum amount of FFB among the actual records in that mill will be used as thebaseline amount for estimation of GHGs emission. This judgement is made based on theconservativeness policy.

b. Project ScenarioThe small-scale palm oil factories that are difficult to control the FFB reception, it is estimated thatthe owners has been making an effort to maximize their operation rate. It is virtually not possible toincrease further FFB received only because of the installation of methane gas generation facility.Therefore, the amount of FFB received is assumed not to change in the project scenario. This is aconservative projection.

However, the amount of FFB reception that is estimated under the project scenario as well asbaseline scenarios is reviewed and revised based on the result of regular monitoring.

• Transport distance from plantationsAs specified by UNFCCC, the estimation of GHGs emission can be omitted if the amount is similarbetween the baseline and project scenarios. Therefore, the transport distance of FFB that may increase inthe project scenario is subject to GHGs emission. The transport distance of FFB is estimated based on thelocations of plantations where FFB is transported and the mill. If uncertainty factor is high, conservativeestimation will be made. However, taking into account that FFB needs to be processed within 24 hoursafter its harvest and the further the distance the higher the transport cost, the distance of FFB transport issomehow limited.

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• Methane contentSince there is very few research on the monitoring of biogas emission from POME treatment at theopen-air anaerobic lagoon, methane content of emitted biogas from POME is an uncertain factor inthe estimation of GHGs.

a. Baseline scenarioThere is almost no prior research effort on the monitoring of biogas generated from the treatmentof POME by open-air anaerobic lagoon though there are some examples of biogas monitoringfrom the sealed digester lagoon. In the case of open-air anaerobic lagoon, biogas monitoringneeds to be carried out on the condition that the surface of POME directly contacts with theatmosphere. The methodology here applies the methane content of 58% which is obtained fromthe joint research between Kyushu Institute of Technology (KIT) and University Putra Malaysia(UPM) in 2003. This joint research program monitors methane content of biogas from the open-air anaerobic lagoon for the consecutive 52 weeks with the floating gas monitoring device on thelagoon.

b. Project scenarioWith regard to the biogas generated from the sealed digestion tank, the methane content of 65%(PORIM), which is a conventional figure in Malaysia, is applied in this project

Methane content for each POME treatment system can be regarded as the generic value which can beapplied to the most cases because of the following reasons:

a) The main factors influencing anaerobic fermentation process such as water temperature,and barometric pressure is usually stable in tropical climate regions like Malaysia;

b) Methane content is determined as a result of one year monitoring and observation; andc) Water depth, which is an important determinant of anaerobic level of the treatment

system, is considered separately from other factors.

Although the above monitoring result is used in principle for projecting GHGs emission in baselineand project scenarios, the estimation will be revised at the time when more precise data of methanecontent is obtained during the project period.

Chart5.1. Methane content rateScenario System Methane content rate Data SourceBaselineScenario

Open Anaerobic Lagoon 58% KIT-UPMcollaborative research

Project Scenario Sealed Digesting Tank 65% Palm Oil ResearchInstitute of Malaysia

• Additives into Sealed Digester tankIn the project scenario, the additives such as sodium hydrate may be utilized to optimizefermentation in the sealed digestion tank. Although such additives need to be procured andtransported to the mill, their amount required is small enough to ignore GHGs emission from theirtransport. Therefore, GHGs emission from transportation of such additives is not included in thisestimation.

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6. Description of how the baseline methodology addresses the calculation of baseline emissionsand the determination of project additionality:

This estimation shall be adjusted by the actual data after the project will start. Assessment of GHGsemission estimation will also be made by OE.

6.1. Baseline emissions

6.1.1. GHG (CH4) Emission from POME

GHG (CH4) Emission from POME is estimated by the following procedure.

Required parameters・Annual FFB received : FFBi(BAU) (t/y)・Annual POME generation : POMEi(BAU) (m3/y)・Extraction Ratio of CPO from unit FFB : R_(FFB→CPO) (t_CPO/t_FFB)・Generation Rate of POME from CPO : R_(CPO→POME) (m3_POME/t_CPO)・Biogas generation per unit POME : R_(POME→BIOGAS) (m3_Biogas/m3_POME)・Methane content in the biogas : R_(BIOGAS→METHANE) (m3_Methane/m3_Biogas)・Global warming potential of Methane : GWP(CH4)

[STEP1]:Estimation of annual POME generationStep1.1. Estimation of annual FFB received (FFB i(BAU))The amount of FFB received in the baseline scenario is assumed as the minimum value of the actualyearly record of the most recent 7 years from the project implementation. The total amount of FFBreceived is the summation of the minimum record and the calculation is due to be done beforeimplementing the project.(ex-ante)

FFBTotal (BAU) = ∑=

7

1iFFB i(BAU) (t)

It is supposed that this project does not increase the amount of FFB received for the following reasons(please refer to the Annex3.5.Assesment of uncertainty).

a) This methodology is applicable to small-scale CPO factories without their own oil palmplantations. Generally, they are always making every possible effort of maximizing theirproduction. It means that there will be no more margin to increase their production even thoughadditional CER incentive is provided by the project.

b) In small-scale management companies which do not own many mills, it is difficult to control theamount of FFB received even among the mills within the company.

Assuming that the amount of FFB received will be identical between baseline and project case, the projectwill determine the amount of FFB received in accordance with the actual record taken from the project.

Step1.2. Estimation of CPO extraction rate (R_(FFB→ CPO) )from FFBCPO extraction rate in the baseline scenario is estimated as the result of the average rate of the past 10years’ actual extraction data. CPO extraction rate is estimated by the following formula. The estimatedrate will be fixed all through the project period. If the CPO extraction rate is not available in the projectmill, statistical data can be utilized.

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R_(FFB→CPO) ={∑=

10

1i Ri_(FFB→CPO) }/10 (t_CPO/t_FFB)

Step1.3. Estimation of annual CPO production (CPOi_BAU) in the baseline scenarioCPO production can be calculated as the result of multiplying the annual FFB received by palm oilextraction rate (OER).

CPO i(BAU)= FFB i(BAU) ×R_(FFB→CPO) (t_CPO/year)

Step1.4. Estimation of POME generation rate (R_(CPO→POME) ) from CPOPOME generation rate from CPO is established based on the reliable actual monitoring data to beobtained.

Step1.5. Estimation of annual POME generation (POMEi_BAU)POME generation can be calculated as the result of multiplying the CPO production (t_CPO) by POMEgeneration rate(m3_POME/t_CPO).

POME i(BAU)

=CPO i(BAU) ×R(CPO→POME)

=FFB i(BAU)× R_(FFB→CPO)×R(CPO→POME)

[STEP2]:Estimation of methane generation per unit volume of POMEMethane generation per unit of POME is estimated based on the IPCC guideline in 1996 in thismethodology.

Required parameters・Removal of COD per unit volume of POME : ∆COD(kg)・COD concentration of unit of POME before anaerobic treatment : CODbefore(mg/l)・COD concentration of unit of POME after anaerobic treatment : CODafter(mg/l)・COD Removal Efficiency : RemovalEfficiency・Maximum CH4 producing Capacity : Bo (kg_CH4/kg_COD)・Estimated actual CH4 production : B (kg_CH4/kg_COD)・Water Depth Factor : WaterDepthFactor・Methane conversion factor : MCF

・Weight per unit volume of methane : a(t/m3)・Temperature : T(℃)・Volume of gas : V(l)・Volume of gas (standard temperature and pressure) : Vo(l)・Biogas generation per unit volume of POME : R_(POME→BIOGAS)

(m3_Biogas/m3_POME)・Methane concentration in the Biogas : R_(BIOGAS→METHANE)

(m3_Methane/m3_Biogas)

Methane generation per unit of POME is given in the following formula.

CH4_POME (kg_CH4/m3_POME) = ∆COD(kg) ×Bo(kg_CH4/kg_COD)×MCF

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Step2.1. Estimation of removed COD per unit of POME by the anaerobic fermentation treatmentEither of the following two methods will be adopted for the estimation of removed COD

Case1: COD concentration data of POME before and after anaerobic treatment are available.Removed COD by the anaerobic fermentation is a balance of COD concentration of POME before andafter the anaerobic fermentation.

∆COD(kg/m3) = CODbefore (mg/l)-CODafter(mg/l)

Case2: COD concentration data of POME after anaerobic treatment are not available.Removed COD is estimated as the result of multiplying COD concentration per unit POME beforeanaerobic treatment by COD removal co-efficient. COD removal co-efficient is obtained from the mostreliable data available for the POME treatment method to be applied.

∆COD(kg/m3) = CODbefore (mg/l) ×10-6×Removal Efficiency

Step2.2. The Maximum methane producing capacity (Bo)The Study applies IPCC’s default value of 0.25.

Step2.3. The estimated actual methane production (B)Although the default value of Bo is 0.25 in the IPPC Guideline in 1996, it is the maximum possiblemethane generation regardless of the fermentation conditions; there is the possibility for excessiveestimation. It would be adequate to set the actual methane production according to the POME treatmentmethod. B is the index how much of organic matters in the POME be converted to methane at the actualanaerobic process. B is given by the following formula.

B = R_(POME→BIOGAS) ×R_(BIOGAS→METHANE)×a÷∆ COD

[Weight of methane per unit volume]Gas volume under a certain temperature (T) is calculated in the following formula from Charles Law(assuming atmosphere presser is 1 atm). The average temperature in the Southeast Asia plains where thepalm oil industries are much located is set at 27 degree centigrade4.

V = Vo*(273+T)/273= 22.4*(273+T)/273(l/mol)(gas volume under 27℃ and 1atm)= 24.6

Therefore, weight of methane per unit volume is calculated as follows:

a = weight per a mol of methane= 16×10-3(kg/mol)÷24.6(l/mol)= 6.50×10-4(t/m3)

4 According to the Malaysian Meteorological Service, the average temperature in Malaysia is 27 degree centigrade in an averageyear. This value can be applied to all seasons, as the seasonal variation in temperature is not large in Malaysia.

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[Removed COD per unit of POME]The removed COD per unit of POME is calculated by the following formula. The average CODconcentration before POME treatment is approximately 50,000(mg/l)5. On the other hand, the averageCOD removal efficiency depends on the retention time and other conditions.

It is said that COD removal efficiency of the sealed digester is more than 95%. On the other hand,according to the KIT-UPM study, removal efficiency of open digesting tank is reported 80% which is anobservation value of the tank in operation.

In order to make the rational choice, the removal efficiency values should be taken into account suchuncertainty factors. Therefore, the COD removal efficiency is set at 90% f or the project scenario,although the sealed digester tank is designed to keep enough retention time.In the baseline scenario, COD removal efficiency in the existing lagoon treatment will be lowered due tothe scum on the surface of POME and insufficient retention time of wastewater by rainwater intrusion.Taking into account such conditions, the study set up the removal efficiency of 85% for the baselinescenario.

∆COD_ave= Average COD concentration before POME treatment×Average COD removal efficiency= CODbefore_ave÷Removal Efficiency_ave

Chart6.1. Setting of removed COD per unit of POMEAnaerobic lagoon Sealed Digesting Tank

CODbefore_ave 0.05(t/m3)RemovalEfficiency_ave

0.85 0.90

Data source Based on KIT-UPM research MPOB experiment

[R_(POME→BIOGAS)]Biogas generation from POME ranges between 20~28m3 according to the PORIM experiment. Although“Malaysia National Greenhouse Gas Inventory 1994 adopts the value of 28m3, the project adopts theintermediate value of 24 m3 since the reason why the biogas generation ranges from 20 to 28 m3 is notclear.

R_POME→Biogas=24 (m3_Biogas/m3_POME)

[R_(BIOGAS→METHANE)]Because the conditions like the retention time and the depth of the tank are different between treatmentmethods, it would be not appropriate to apply the same value to different treatment methods. Forexample, the sealed digester tank is estimated to be under the complete anaerobic condition regardless ofdepth due to sealing from the atmosphere while the open-air anaerobic lagoon includes aerobic onditiondepending upon its depth because of direct contact with the atmosphere at its surface. The IPPCguideline does not indicate the depth that makes MCF one (complete anaerobic fermentation). In thismethodology, we adopt the value from the cases in which anaerobic level seems to be near 1.

R_(BIOGAS→METHANE) of sealed digester and anaerobic lagoon applied are shown in the following table.

5 Oil Palm and the Environment ~A Malaysian Perspective (1999)

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Chart6.2. Methane content of each POME treatment systemAnaerobic lagoon Sealed Digesting Tank

CH4 58%6 65%7

Water depth 6m 10mData source KIT-UPM research MPOB experiment

[Setting of B]Methane conversion factor is determined for each scenario (baseline and project scenarios) on the basis ofB, which is estimated from the parameters above. Therefore, the above parameters and B are fixedfactors in this methodology and not differently established by projects.

Baseline scenarioB in the baseline scenario is calculated by the following formula using the above figures.B(BAU) = R_(POME→BIOGAS) ×R_(BIOGAS→METHANE)×a÷∆ COD

= 24(m3_Biogas/m3_POME)×0.58×6.50×10-4(t/m3)÷(0.05(t/m3)×0.85)= 0.213 (kg_CH4/kg_COD)

Project scenarioB in the project scenario is calculated by the following formula using the above figures.B(Project) = R_(POME→BIOGAS) ×R_(BIOGAS→METHANE)×a÷∆ COD

= 24(m3_Biogas/m3_POME)×0.65×6.50×10-4(t/m3)÷(0.05(t/m3)×0.90)= 0.225 (kg_CH4/kg_COD)

Step2.4. The Methane conversion factor

[Consideration of water depth]The methane conversion factor is determined by the conditions of fermentation such as water depth,circulation speed, temperature and so on.

As shown in the process of setting the B, the difference in methane conversion factor among the methodsof POME treatment mainly comes from the difference in conditions of circulation, anaerobic level(contact with the atmosphere). In the case of lagoon treatment of POME, its water depth is an importantdeterminant of MCF.

Although the IPPC Guideline 1996 does not provide the method of setting anaerobic level, the levelbecomes zero in the case of complete aerobic condition while it becomes 1 in the case of completeanaerobic treatment. It also mentions that the aerobic condition is dominant in the depth of 1-2 meter andthe anaerobic fermentation begins from the depth of 2-3m.

Actual value used in setting R_(BIOGAS→METHANE), is 58% at the water depth of 6m. Assuming that a highanaerobic level is ensured at the depth of 6 m, the project set the MCF as 0.85 in the water depth of morethan 6 meter. In addition, the project assumes that the complete aerobic treatment will occur in theaerobic lagoon with the water depth of 2 meter and aerobic level will be in proportion to water depthbetween 2 and 6 meter. Although the anaerobic level of the sealed digester tank is higher than theanaerobic lagoon since the tanks is completely enclosed, water depth factor of the sealed tank is assumedto follow the values given in the table below, taking into the conservativeness policy. The depth of lagoonneeds to be measured by the operating body and to be validated by DOE.

6 The actual measurement value by Malaysia Palm Oil Board using sealed digester with capacity of 4,200m37 The actual measurement value by KIT-UPM using open anaerobic lagoon

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0.25

0.5

0.75

0

0.25

0.5

0.75

1

0 2 3 4 5 6 7

Lagoon Depth (m)

Wat

er

Depth

Fac

tor

Chart6.3. Water depth factor

[Determination of MCF]The four parameters, namely R_(POME→BIOGAS), R_(BIOGAS→METHANE), a, and ∆COD_ave finally determine themethane emission per COD decomposed. The MCFs in the baseline and project scenarios are estimatedfrom the value of B and B0 above.

MCF value in Asia where the palm oil producing centers exist is set at 0.9 in the IPPC Guideline.

MCF for project scenario will be obtained by the formula below.MCF = B ÷ B0

= 0.225÷0.25= 0.90

On the other hand, for baseline scenario, water depth factor is necessary to be considered. MCF forbaseline scenario will be obtained by the formula below.MCF = (B× WaterDepthFactor) ÷ B0

=(0.213× WaterDepthFactor)÷0.25= 0.85× WaterDepthFactor

0.21

0.43

0.64

0.85 0.85

0.00

0.25

0.50

0.75

1.00

0 2 3 4 5 6 7

Lagoon depth (m)

MC

F

Chart6.4. MCF of lagoon

Step2.5. Estimation of methane generation per unit volume of POME

Methane generation per unit of POME (CH4_POME) can be calculated by the following formula, makinguse of the parameters given in Step 2.1 to step 2.3 above

Methane generation per unit of POME (CH4_POME))

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CH4 (BAU)_POME =∆COD(kg) ×Bo(kg_CH4/kg_COD)×MCF(BAU)

GHG emission (CO2 equivalent) per unit of POMEGHG(BAU)_POME =∆COD(kg) ×Bo(kg_CH4/kg_COD)×MCF(Project)×GWP(CH4)

6.1.2. Fossil fuel based GHGs emissions (CO2, N2O, CH4) substituted by methane gas powergeneration

Methane gas power generation substitutes fossil fuel based GHGs emission in the following two ways:- Substitution of the purchasing electricity by methane power generation- Selling electricity to the public grid or outside users as the substitute of conventional power

sources generated by fossil fuels.

Required parameters for estimation of GHG emission substituted are shown in the following table.

Required parameters・COD Removal amount : ∆COD(kg)・Maximum CH4 Producing Capacity of the Project Scenario : Bo(kg_CH4/kg_COD)・CH4 conversion factor(Anaerobic level) : MCF(Project)

・Annual methane recovery in the project scenario :CH4 (Project)_POME

・CO2 emission coefficient of power grid :EF(GRID→CO2) (kg/kWh)・CH4 emission coefficient of power grid :EF(GRID→CH4) (kg/kWh)・N2O emission coefficient of power grid :EF(GRID→N2O) (kg/kWh)・Global warming potential of CH4 :GWP(CH4)

・Global warming potential of N2O :GWP(N2O)

・Combustion calorie of methane :HV_Methane(MJ/kg)・Annual operation hours :Operation Hours(h/y)・Conversion factor from joule to watt-hour :CF(joule→watt-hour)(kWh/MJ)・Power generation efficiency :Efficiency・Power generated :Electricityi_generated(MWh/y)・Transmission loss ratio of electricity (generated in the projectscenario)

:LossRatio_project(%)

・Transmission loss ratio of electricity (to be replaced in theproject scenario)

:LossRatio_replaced(%)

[STEP0]:Calculation before project implementationOnce the project is implemented, amount of electricity generated will be monitored and the emissionsubstituted by methane power plant will be estimated by the monitored data. However, ex-anteestimation will be done by the following steps.

Step0.1 Estimation of methane recovery in the project scenarioMethane generation in the project scenario is estimated in the same method as 6.2.1. In the projectscenario, sealed digestion tank will be constructed and anaerobic methane fermentation will be carried out.

CH4 i (Project)_POME

= POMEi(Project) ×∆COD(kg) ×Bo(kg_CH4/kg_COD)×MCF(Project)

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Step0.2 Electricity generated by methane power generation (Electricity_generation)Electricity generated by methane power generation can be calculated in the following formula by makinguse of the parameters of Heat value of methane (HV_Methane), conversion factor from calorie to kilowatt-hour (b) and power generation efficiency (Efficiency).

Electricity_ generated

= ∑=

7

1iCH4 i(Project)_POME (t)×HV_Methane(MJ/kg)×CF(joule→watt-hour)(kWh/MJ)× Efficiency(MWh)

[STEP1]: Estimation of emission substituted by methane power generation

After implementation of the project, the amount of power substituted by the project is estimated by thefollowing formula. The emission factor of the power substituted will be based on its energy mix. If themethane power generation facility is connected to national grid, the average energy mix of national gridwill be used for calculation of its emission factor. If the methane power generation substitutes specificpower sources, e.g. diesel power generators, their specific emission factor will be established based ontheir energy mix.

GHG emission substituted by methane power generation (GHG_substitute) is estimated by using thefollowing emission coefficient.

CO2_substitute(t_CO2) = ∑=

7

1i Electricityi_Generated× (1‐LossRatio_project)÷ (1‐LossRatio_replaced)×

EF(GRID→CO2)

CH4_substitute(t_CO2) = ∑=

7

1i Electricityi_Generated× (1‐LossRatio_project)÷ (1‐LossRatio_replaced)×

EF(GRID→CH4) ×GWP(CH4)

N2O_substitute(t_CO2) = ∑=

7

1i Electricityi_Generated× (1‐LossRatio_project)÷ (1‐LossRatio_replaced)×

EF(GRID→N2O) ×GWP(N2O)

GHG_substitute(t_CO2) = CO2_substitute(t_CO2)+ CH4_substitute×GWP(CH4) (t_CO2)+ N2O_substitute×GWP(N2O)

6.1.3. Total GHG emission in the baseline scenario

Total GHG emission in the baseline scenario is calculated by the following formula.

GHGTOTAL_BAU = GHGPOME_BAU (t_CO2)+ GHG_Substitute(t_CO2)

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6.2. Project emissions6.2.1. Emission from methane combustion

Required parameters・Methane recovery in the baseline scenario : CH4(BAU)_POME (t/y)・CO2 Emission Factor of CH4 Combustion : EF(CH4→CO2)(t_CO2/t_CH4)

Since the methane recovered by the project is used as the fuel for power generation, its CO2 emissionneeds to be estimated as a project GHGs emission.

CO2 emission from methane combustion for power generation can be estimated by solving the followingequation.

CO2_combustion(t_CO2)= CH4 (BAU)_POME(t) ×EF(CH4→CO2)(t_CO2/t_CH4)

6.2.2. Emission from start up of methane power generation facility

Required parameters・Electricity consumption per start-up : Electricity Consumption(kWh)・Number of start-up : N・CO2 Emission Factor of Start-up operation : EF(startup→CO2) (kg/kWh)・CH4 Emission Factor of Start-up operation : EF(startup→CH4) (kg/kWh)・N2O Emission Factor of Start-up operation : EF(startup→N2O) (kg/kWh)・Global warming potential(CH4) : GWP(CH4)

・Global warming potential(N2O) : GWP(N2O)

If the electric source is battery, GHG emission from start up of methane power generation will be counted0(zero). However, if the source is the power generation facility, the GHG emission is estimated from thefollowing formula.

CO2_Starup(t_CO2) = Electricity Consumption×N×EF(Startup→CO2)

CH4_ Starup (t_CO2) = Electricity Consumption×N×EF(Startup→CH4)

N2O_ Starup (t_CO2) = ElectricityConsumption×N×EF(Startup→N2O)

GHG_ Startup(t_CO2) = CO2_ Startup + CH4_ Startup×GWP(CH4)+ N2O_ Startup×GWP(N2O)

6.3.1. Total GHG emission in the project scenario

Total GHG emission in the project scenario is calculated by the following formula.

GHGTOTAL_Project = CO2_combustion (t_CO2)+ GHG_ Startup (t_CO2)

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7. Description of how the baseline methodology addresses any potential leakage of the projectactivity:

No leakage occurs in this methodology.

8. Criteria used in developing the proposed baseline methodology, including an explanation ofhow the baseline methodology was developed in a transparent and conservative manner:

• Effluent standard is transparent and available, because it is based on the government lawsand regulations. It also applies conservative policy by taking into account the futuretightening of effluent standard

• In relation to the GHGs emission to be substituted by methane gas power generation inthe project scenario, the methodology adopts the conservative emission factor of GHGsemission from the public grid by taking the average of the total public power sources sincefuel combination for public grid power generation is determined by the power company.

• Regarding the methane concentration in the generated biogas, we adopt the result thatKIT-UPM has jointly experimented in Malaysia. If new experiment data will be availableafter this, the most appropriate date will be applied.

• Regarding the power generation efficiency, the realistic conservative figure will beadopted from the literature survey and past examples.

9. Assessment of strengths and weaknesses of the baseline methodology:9.1. Strengths

• Simplification of the methodology: This methodology is very simplified methodology thatcan estimate main GHG emission by monitoring FFB received and COD removalefficiency. Actual emission can be verified always by .

• If the methane generation in each lagoon is monitored, much cost can be reduced throughsimplifying the estimation methods. This method can be widely applied in all the palmoil factories in the Southeast Asia.

9.2. Weakness• Because this methodology accepts the conservativeness policy in order to solve the

uncertain factors like the increase of FFB received from CDM project, CER may be muchlower than the actual GHGs emission reduced.

• The amount of methane generation from anaerobic lagoon is not yet well monitored andmeasured, therefore difference of methane generation ratio depending upon the conditionsof lagoon is not well documented.

10. Other considerations, such as a description of how national and/or sectoral policies andcircumstances have been taken into account:

• Effluent standard and future possibility of its tightening is considered.• Current restriction of land use is considered.• Government policy of new energy development is considered.

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Annex 4

NEW MONITORING METHODOLOGY

Proposed new monitoring methodology

Title: Monitoring Methodology of Methane Recovery from Palm Oil Mill Effluent and Renewable Electricity Generation

1. Brief description of new methodology

1.1. Monitoring parameters

This methodology is the methodology that can monitor below parameters.

[Baseline emission]• Methane emission from POME treatment

Monitoring parameters: POME generation, COD concentration before and after anaerobic treatment• GHG emission substituted by power generation

Monitoring parameters: Selling Electricity

[Project emission]• GHG emission by power generation by methane

Monitoring parameters: Electricity consumption and revolution upon start-up

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1.3. Monitoring plan diagram

This figure is the monitoring plan diagram. In case, continuous monitoring is impossible, the lowest figure (the most conservative figure) should be adoptedform the past measurements (under an certain condition, like from past data within 2 months). Depending on the monitoring result, CER should be reviewed.All the data should be stored in electronic media and transferred to DOE for the inspection.

Power plant(Biomas combustion)

Steriliser Stripper Digester Press

Screen

Settling tank

Desander

Centrifuge

Centrifuge

Vacuum dryer

Nut/Fiber Separator

Nut dryer/cracker

Winnowing Column

Hydrocyclone

Kernel dryer

Press liquor Press cake

Sludge

CPO

EFB Project boundary

FFB

plantation

Project Scenario

Fiber

Shell

Fuel

CPO Production ProcessPalm Oil Mill

Sludge

Start-upElectric Source

Onsite useMethane power generation

Start-upElectric Source

Electricity utilization

2:POMEFlow meter

3:COD_beforeManual sampling

4:COD_afterManual sampling

7:Electricityintegral power

consumption meter

6:Fuel-startupmanual check

POMEPOME anaerobic treatment

POME aerobic treatment

5:BOD_dischargeManual sampling

1:FFBVoucher check

Chart1.1. Monitoring plan diagram2. Data to be collected or used in order to monitor emissions from the project activity, and how this data will be archived

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ID number Data type Data variable Dataunit

Measured (m),calculated (c) orestimated (e)

RecordingFrequency

Proportion of datato bemonitored

How willthe data bearchived?(electronic/paper)

For howlong isarchived datakept?

Measurementmethod

Scenario

1 FFB Weight FFB received t/d M Monthly 100% Electronic Project lifetime

Manually(vouchercheck)

Baseline

2 POME Flow rate POMEgeneration

m3/d M Monthly 100% Electronic Project lifetime

Flow meter Baseline/Project

3 COD_before Concentration

CODconcentrationbefore POMEtreatment

mg/l M Monthly 100% Electronic Project lifetime

Manually(sampleanalysis)

Baseline/Project

4 COD_after Concentration

CODconcentrationbefore POMEtreatment

mg/l M Monthly 100% Electronic Project lifetime

Manually(sampleanalysis)

Project

5 Electricity Electricity Electricitygenerated

Kwh M Continuously 100% Electronic Project lifetime

Automatically Project

6 Fuel_starup Volume Amount offossil fuel usedfor the start upby the back uppower source.

L M When Back upgenerator isused

100% Electronic Project lifetime

Manually Project

7 BOD_discharge

Concentration

BOD beforePOMEdischarge

mg/l M Monthly 100% Electronic Project lifetime

Manually(sampleanalysis)

Project

8 OperatingDays

Days Days of milloperation

days M Monthly 100% Electronic Project lifetime

Manually Project

3. Potential sources of emissions which are significant and reasonably attributable to the project activity, but which are not included in the projectboundary, and identification if and how data will be collected and archived on these emission sources

There is no leakage monitoring required in this methodology.

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4. Assumptions used in elaborating the new methodology:

There is no assumption in this methodology.

5. Please indicate whether quality control (QC) and quality assurance (QA) procedures are being undertaken for the items monitored. (see tables insections 2 and 3 above)

ID number Uncertainty level of data(High/Medium/Low)

Are QA/QC proceduresplanned for these data?

Outline explanation why QA/QC procedures are or are not being planned.

1 FFB Low Yes Methane emissions will be calculated based on this FFB data.Payment slips in the palm oil mill is used. These slips are usually used for statistics likethe calculation of palm oil production ,data credibility is high.

2 POME Low Yes POME data is the key factor of the calculation of baseline methane emissions and carbondioxide emission from methane combustion in the project scenario.Data reliability should be assured by continuous measuring with precise measuringdevices,

3 COD_before Low Yes This data is needed in order to calculate carbon dioxide emission from methanecombustion in the project scenario.Data reliability should be assured by increasing the frequency of measurement and byusing precise measuring devices.

4 COD_after Low Yes This data is needed in order to calculate baseline methane emissions and carbon dioxideemission from methane combustion in the project scenario.Data reliability should be assured by increasing the frequency of measurement and byusing precise measuring devices.

5 Electricity Low Yes Electricity replaced by methane power generation will be calculated based on this data.Data reliability should be assured by continuous measuring with precise measuringdevices,

6 Fuel_backup Low Yes This data will be monitored in order to calculate the carbon dioxide emission from startup of methane power generation facility.By measuring actual diesel fuel consumption when using spare power source, dataliability is assured.

7 BOD_discharge Low Yes This data will be monitored to check the discharged water in the project scenario meetsthe effluent standard.Data will be assured by increasing the frequency of measurement and by using precisemeasuring devices.

8 Operating date Low Yes Operating date will be monitored to check consistency of the actual operation andassumptions of the project design document.

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6. What are the potential strengths and weaknesses of this methodology?6.1. Strengths• Most of the monitoring items are within the realm of regular monitoring in palm oil factories. Therefore, it is acceptable to palm oil factories.

6.2. Weaknesses

None

7. Has the methodology been applied successfully elsewhere and, if so, in which circumstances?

None

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Annex 5

TABLE: BASELINE DATA

(Please provide a table containing the key elements used to determine the baseline (variables, parameters,data sources etc.). For approved methodologies you may find a draft table on the UNFCCC CDM website. For new methodologies, no predefined table structure is provided.)

A. Key elements for estimation of GHG emission

Parameter Value SourceMethaneRecovery

Amount of FFB received(2002) 205,515(t/y) Data from mill

Amount of FFB received(2003) 246,555(t/y) Data from millExtraction ratio of CPO from unit FFB 0.189

(t_CPO/t_FFB)Calculated based onMalaysian Oil PalmStatistics 2002

Amount of POME generated per unit CPO 2.5(m3_POME/t_CPO)

Malaysia NationalGreenhouse GasInventory 1994

Amount of Biogas generated per unit CPOproduction

24(m3_Biogas/m3_POME)

Malaysia NationalGreenhouse gasInventory 1994

Methane content in the biogas (baselinescenario)

58% KIT-UPM research

Methane content in the biogas (projectscenario)

65% Palm Oil ResearchInstituteMalaysia(PORIM)

COD before anaerobic treatment 53,816(mg/l) Project specificCOD removal efficiency 85% AssumptionMCF(baseline scenario) 0.85 AssumptionMCF(project scenario) 0.9 Assumption

MethaneElectricityGeneration

Heat value of methane 55.5(MJ/kg) Theoretical value

Efficiency 25%Engine rating 920kWh

B. Key elements for cost analysis

Parameter Value SourceElectricity currently bought from the grid 816(MWh) Data from millUnit cost of grid electricity 0.258(RM/kWh) Data from millUnit price for grid electricity 0.16(RM/kWh) Tenaga National Berhad(TNB)Exchange rate 3.8(RM/US$) Official dataConstruction cost of digester tank(500m3) 120,000(US$/tank) Sumitomo Heavy IndustryGas engine price(600kW) 300,000(US$) Tenaga National Berhad(TNB)Unit cost of power cable 150,000(US$) Tenaga National Berhad(TNB)Manpower cost(Site supervisor) 5,000(RM/man) Pusat Tenaga Malaysia(PTM)Manpower cost(Engineer A) 2,000(RM/man) Pusat Tenaga Malaysia(PTM)Manpower cost(Engineer B) 750(RM/man) Pusat Tenaga Malaysia(PTM)

Page 66

ANNEX 6

ABBREVIATION

FFB: Fresh Fruit BunchEFB: Empty Fruit BunchCPO: Crude Palm OilPOME: Palm Oil Mill EffluentOER: Oil Extraction RateRM: Ringgit MalaysiaTNB: Tenaga National BerhadPTM: Pusat Tenaga MalaysiaPORIM: Palm Oil Research Institute of MalaysiaKIT: Kyushu Institute of TechnologyUPM: Universiti Putra Malaysia