clean development mechanism project design document … whr project_.pdf · clean development...

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03.1.

CDM – Executive Board

page 1

CLEAN DEVELOPMENT MECHANISM

PROJECT DESIGN DOCUMENT FORM (CDM-PDD)

Version 03 - in effect as of: 28 July 2006

CONTENTS

A. General description of project activity

B. Application of a baseline and monitoring methodology

C. Duration of the project activity / crediting period

D. Environmental impacts

E. Stakeholders’ comments

Annexes

Annex 1: Contact information on participants in the project activity

Annex 2: Information regarding public funding

Annex 3: Baseline information

Annex 4: Monitoring plan

Appendix 1: WHR power projects in Chhattisgarh state as per UNFCCC website



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SECTION A. General description of project activity

A.1 Title of the project activity:

>>

API WHR Project

Version 4

26/04/2009

A.2. Description of the project activity:

>>

The project takes place at a 350 tonnes per day sponge iron plant owned by API Ispat & Powertech (P)

Ltd in the district of Raipur, Chhattisgarh, India. The project activity will generate electrical power for

the sponge iron plant by recovering the waste gases from the sponge iron kiln, passing these through a

waste heat recovery boiler to generate steam which will be fed to a turbine generator. The electricity

generated will be used on site and the excess electricity1 will be fed to Chhattisgarh State Electricity

Board (CSEB). The project is therefore expected to replace existing and planned grid generation.

Chhattisgarh state is dominated by fossil fuel based generation with, 3380MW of thermal based power

generation and only 125MW of hydro2.

The project activity involves the installation of a 38 tonnes per hour capacity waste heat recovery boiler

capable of operating at a pressure and temperature of 60kg/cm2 and 490°C respectively and a 15MW

condensing type turbine generator at the sponge iron plant. The project power plant will utilise the hot

gases, 90,000Nm3/hour that are generated during the manufacture of sponge iron. These gases exit the

sponge iron kiln at about 950oC and through utilising the heat in the gas, steam is generated to power a

steam turbine. The project was commissioned on 3rd

June 20073. The company is also installing a

45tonnes per hour Air Fluidized Bed Boiler (AFBC) operating at a temperature and pressure of 490°C

and 66kg/cm2 respectively. The boiler will utilize coal fines, char and dolochar (unburnt coal from kiln)

and the steam will be fed through a common steam header to the turbine generator. The AFBC boiler is

expected was commissioned on 4th October 2008.

4 There are two existing diesel generators on site. These

are not part of the project activity as they only generate electricity in emergencies to rotate the sponge

iron kiln and are held as back up units on the site.

In the absence of the project activity the sponge iron plant satisfied its energy requirement through

import from the grid.

Contribution of project activity to sustainable development

1 A power purchase agreement has been entered into which specifies a maximum of 2MW of electricity export to the

grid.

2 8 http://cea.nic.in/god/opm/Monthly_Generation_Report/18CT0307.pdf

3 Grid synchronization meter reading card by Chhattisgarh State Electricity Board dated 3

rd June 2007 provided to

the validator.

4 Grid synchronization meter reading card by Chhattisgarh State Electricity Board dated 4

th October 2008 provided

to validator.

http://cea.nic.in/god/opm/Monthly_Generation_Report/18CT0307.pdf



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The project will contribute directly to employment in the area, employing about 40 people in the power

plant and will contribute to sustainable development through the substitution of fossil fuel based

generation which currently dominates the grid. Chhattisgarh is heavily dependent on coal with less than

10%5 of generation sourced from non-fossil fuels. The introduction of such small scale generation

schemes is therefore a positive step towards reducing the dependence on fossil fuels.

Contribution of project activity to Environment

Through the generation of electricity for captive use and supply to the grid, the project activity will have

a direct environmental benefit. The generation of power from waste gases has long term benefits related

to climate change given that the alternative is a fossil fuel based generation system. Local pollution will

also be reduced as the alternative is predominantly fossil fuel combustion for the supply of electricity

which will give rise to increased emissions of NOx, SOx and ash. Moreover the utilization of waste gases

which were being released to the atmosphere before the project activity reduces the local pollution in the

surrounding area.

A.3. Project participants:

>>

Name of Party involved

((host) indicates a host Party)

Private and/or public

entity(ies) project participants

(as applicable)

If Party wishes to be

considered as a project

participant

India (host) API Ispat & Powertech (P) Ltd No

United Kingdom Agrinergy Pte Ltd No

The official contact for the project activity will be API Ispat & Powertech (P) Ltd, contact details as

listed in Annex I.

A.4. Technical description of the project activity:

A.4.1. Location of the project activity:

>>

A.4.1.1. Host Party(ies):

>>

India

A.4.1.2. Region/State/Province etc.:

>>

Chhattisgarh

A.4.1.3. City/Town/Community etc:

>>

5 Page 28 on the following web link gives the total and non fossil generation





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Raipur district, Village Siltara

A.4.1.4. Detail of physical location, including information allowing the

unique identification of this project activity (maximum one page):

>>

Siltara Growth Center

The main khasra numbers of the site are: 384/3,384/12,384/8,384/5,384/7,390/1,390/3, 399/2,

384/4,384/11,391/2-3,430,390/2,392/5,384/6,291/1,292/2.

The site is about two and a half kilometre away from the nearest highway and railway station.

The grid reference6 of the project activity site is:

Latitude - 21°21’ N

Longitude - 81°40’ E

Project Activity

6 Page 1.2, Environmental Impact Assessment report provided to the validator.



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A.4.2. Category(ies) of project activity:

>>

Sectoral Scope 1: Energy Industries (renewable/non renewable sources)

Sectoral Scope 4: Manufacturing Industries

A.4.3. Technology to be employed by the project activity:

>>

The project will install a waste heat recovery boiler and a turbine generator to generate electrical power

from the waste heat gases produced during the manufacture of sponge iron. The majority of sponge iron

in India is manufactured through the direct reduced iron process (DRI). This process involves passing

coal and iron ore through a rotary kiln at high temperatures (over 1000oC) to reduce the iron ore to

sponge iron. The reduction process yields carbon dioxide and carbon monoxide at a temperature of

around 950oC, it is these gases which are used in the generation of electricity.

After leaving the kiln the waste gases of 90,000Nm3/hr at 950°C are passed through an after burner

chamber (ABC) and then fed to the waste heat recovery boiler, the gases then pass through an

electrostatic precipitator and are eventually released to the atmosphere via the stack. The electrostatic

precipitator is a much more effective means of collecting particles from waste gases and therefore the

benefits of installing waste heat recovery will be reflected not just in the displacement of fossil fuel

based power generation but also in the reduced particle matter being released into the atmosphere.

The technology employed in the generation of electrical power will be one 38 tonnes per hour 66 bar

single drum natural circulation water tube boiler manufactured by Thermax India. The boiler will

generate superheated steam of 490oC and have an inlet steam temperature at the economiser of 126

oC.

The boiler is connected to a 15MW condensing type turbine generator. In addition, the factory has

installed an air fluidised bed boiler (AFBC) that is also connected to the turbine generator. This boiler

will burn coal fines, char and dolochar (the unburnt coal from the kiln) to generate steam that will be fed

through a common steam header to the turbine generator. The turbine speed is 7,700 rpm and has an inlet

pressure and temperature of 62 bar and 488oC respectively.

The capacity of waste heat recovery unit is to produce 8MW of power and another 7MW is from the coal

based system. The consent to establish and the technical specifications have been provided to the DOE to

demonstrate the capacities.

In the event of shut down of the sponge iron kiln, the waste heat recovery boiler also shuts down due to

unavailability of waste gas. During this shutdown, the AFBC boiler produces power to run the two

induction furnace units. The electrical power will be generated at 11kV for use in the sponge iron unit

and excess power will be stepped up at the plant to 33kV for use in the grid.

There is no transfer of technology to the host country since the technology is available in, and supplied

from India.

The specifications of the equipments installed are as given below:

Waste heat recovery boiler steam generation 38,000 kg/hr

Type of boiler Single drum natural circulation water tube



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Orientation of boiler Vertical

Steam pressure 60kg/cm2

Steam temperature at super heater outlet 490°C

Feed water temperature at economiser inlet 126°C

Blowdown loss 2%

Radiation loss 2%

AFBC Boiler steam generation 45000kg/hr

Steam pressure 66 kg/cm2

Steam temperature at super heater outlet 490°C

Turbine capacity 15MW

Specified steam pressure 62 ata

Specified inlet steam pressure 488°C

Speed 7700 rpm

A.4.4 Estimated amount of emission reductions over the chosen crediting period:

>>

Year Annual estimation of emission reductions in

tonnes of CO2e

2009-2010 29,904

2010-2011 29,904

2011-2012 29,904

2012-2013 29,904

2013-2014 29,904

2014-2015 29,904

2015-2016 29,904

2016-2017 29,904

2017-2018 29,904

2018-2019 29,904

Total estimated reductions (tonnes CO2e) 299,040

Total number of crediting years 10

Annual average over the crediting period of

estimated reductions (tonnes of CO2e)

29,904

A.4.5. Public funding of the project activity:

>>

The project has not received any public funding.



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SECTION B. Application of a baseline and monitoring methodology

B.1. Title and reference of the approved baseline and monitoring methodology applied to the

project activity:

>>

ACM 0012- Consolidated baseline methodology for GHG emission reductions for waste energy recovery

projects

Version 03.1

In line with the application of the methodology the project draws on element of the following tools:

Version 05.2 - Tool for the demonstration and assessment of additionality

Version 01.1 - Tool to calculate the emission factor for an electricity system

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

activity:

>>

The project activity meets the applicability conditions of the baseline methodology, namely:

S. No. Methodology Condition Applicability

1 The consolidated methodology is for the following

types of project activities:

Type-1: All the waste energy in identified

WECM stream/s that will be utilized in the

project activity is, or would be flared or

released to atmosphere in the absence of the

project activity at the existing or new facility.

The waste energy is an energy source for:

o Cogeneration; or

o Generation of electricity; or

o Direct use as process heat source; or

o For generation of heat in element process2

(e.g. steam, hot water, hot oil, hot air); or

o For generation of mechanical energy.

The waste gas was released in the

absence of the project activity at the

existing facility. The project activity

is a type I project as it utilizes waste

gas to generate electricity. WECM is

the gas in case of the project activity.

2 • Type-2: An existing industrial facility, where the

project activity is implemented, that captures and

utilizes a portion4 of the waste gas5 stream(s)

considered in the project activity, and meet the

following criteria.

The project activity is not a Type II

project.

3 For project activities that use waste pressure, the

consolidated methodology is applicable where waste

pressure is used to generate electricity only.

The project activity does not use

waste pressure.

4 If the project activity is based on the use of waste

pressure to generate electricity, electricity generated

using waste pressure should be measurable.

The project activity does not use

waste pressure.

5 Energy generated in the project activity may be used

within the industrial facility or exported from the

The energy generated in the project

activity will be used for captive



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industrial facility. consumption in the sponge iron plant.

Excess electricity if any will be

exported to the grid.

6 The electricity generated in the project activity may be

exported to the grid or used for captive purposes.

Energy generated by the project will

be used in the adjacent sponge iron

plant and if excess will be exported to

the grid.

7 Energy in the project activity can be generated by the

owner of the industrial facility producing the waste

energy or by a third party (e.g. ESCO) within the

industrial facility.

Energy is being generated by the

owner of the sponge iron plant that

produces the waste gas.

8 Regulations do not constrain the industrial facility that

generates waste energy from using fossil

fuels prior to the implementation of the project activity

Coal was used in the industrial

facility for generating waste gas prior

to implementation of the project.

There are no regulations constraining

the use of coal by the sponge iron

plant and this will continue to be used

after the implementation of the

project.

9 The methodology covers both new and existing

facilities. For existing facilities, the methodology

applies to existing capacity. If capacity expansion is

planned, the added capacity must be treated as a new

facility

The facility is an existing facility and

no capacity expansion is planned. If

capacity expansion is planned in

future it will be treated as a new

facility.

10 The emission reductions are claimed by the generator

of energy using waste energy.

The emission reductions are claimed

by API Ispat & Powertech (P) Ltd, the

generator of electricity using the

waste gas.

11 In cases where the energy is exported to other

facilities, an official agreement exists between the

owners of the project energy generation plant

(henceforth referred to as generator, unless specified

otherwise) with the recipient plant(s) that the emission

reductions would not be claimed by the recipient

plant(s) for using a zero-emission energy source.

Excess energy, if any will not be

exported to any recipient plant but to

the regional grid of India.

12 For those facilities and recipients included in the

project boundary, that prior to implementation of the

project activity (current situation) generated energy on-

site (sources of energy in the baseline), the credits can

be claimed for minimum of the following time periods:

o The remaining lifetime of equipments currently

being used; and

o Credit period.

No energy was generated on site prior

to the project activity.

Emission reductions will be claimed

for the entire crediting period of 10

years.

13 Waste energy that is released under abnormal

operation (for example, emergencies, shut down) of the

The waste gas released under

abnormal conditions will not be



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plant shall not be accounted for. accounted.

14 This methodology is not applicable to projects where

the waste gas/heat recovery project is implemented in a

single-cycle power plant (e.g. gas turbine or diesel

generator) to generate power.

The project activity is implemented in

a steam turbine to generate power.

Demonstration of use of waste energy in absence of CDM project activity

As per the methodology it has to be demonstrated that the waste energy utilized in the project activity

was flared or released in the absence of the project activity at the existing facility.

In case of the project activity this has been proved by providing energy (electricity) bills to demonstrate

that all the energy required for the process has been procured commercially from the regional grid.

B.3. Description of the sources and gases included in the project boundary

>> Source Gas Included? Justification/Explanation

Ba

seli

ne

Electricity generation,

grid or captive source

CO2 Included Electricity generation in the grid using fossil fuels is the

main emission source.

CH4 Excluded Excluded for simplification

N2O Excluded Excluded for simplification

Fossil fuel

consumption in boiler

for thermal energy

CO2 Excluded No fossil fuels were used to generate thermal energy

hence this has not been included.

CH4 Excluded Excluded for simplification. This is conservative.

N2O Excluded Excluded for simplification. This is conservative.

Fossil fuel

consumption in

cogeneration plant

CO2 Excluded There was no consumption of fossil fuels hence this has

been excluded.



Baseline emissions

from generation of

steam used in the

flaring process, if any

CO2 Excluded The waste gas was released to the atmosphere hence

this has been excluded from the project boundary.



Pro

ject

act

ivit

y

Supplemental fossil

fuel consumption at

the project plant

CO2 Excluded No fossil fuel will be consumed at the project site as a

result of the project activity.



Supplemental

electricity

consumption

CO2 Excluded No electricity is consumed as a result of the project

activity.



Electricity import to

replace captive

electricity, which was

generated using waste

gas in absence of

project activity

CO2 Excluded This has been excluded as no captive electricity in the

baseline is replaced by import electricity.





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Project emissions

from cleaning of gas

CO2 Excluded Excluded as no cleaning of waste gas takes place and

hence does not lead to any emissions.



As per the methodology:

“The geographical extent project boundary shall include the following:

(1) The industrial facility where waste energy is generated, including the part of the industrial facility

where the waste gas was utilized for generation of captive electricity prior to implementation of the

project activity)

In accordance with the above condition the boundary includes the sponge iron manufacturing plant.

(2) The facility where process heat in the element process/steam/electricity/mechanical energy is

generated (generator of process heat/steam/electricity/mechanical energy). Equipment providing

auxiliary heat to the waste energy recovery process shall be included within the project boundary; and

In accordance with the above conditions the geographical project boundary includes the sponge iron

plant, equipments installed for the operation of the power plant, the main elements of which are: the

WHR and AFBC boiler, turbine generator, condenser, water treatment plant, effluent treatment plant,

electrostatic precipitator, step-up transformer. There is no equipment providing auxiliary heat to the

waste heat recovery process.

(3) The facility (ies) where the process heat in the element process/steam/electricity/ mechanical energy

is used (the recipient plant(s)) and/or grid where electricity is exported, if applicable.

As the boundary for the determination of the grid carbon emission factor in India is not clearly defined

we follow the guidance in the “Tool to calculate emission factor for an electricity system”. To date, the

DNA has not issued guidance on the delineation of grid boundaries and we therefore follow the guidance

for the layered despatch systems and adopt a regional grid. The Indian electricity system is split into five

regional grids, North, West, East, South and North-East. The project activity falls under the western grid.

The following diagram explains the project boundary clearly:

Kiln After Burning

Chamber

WHRB

AFBC

Commo

n

Steam

Header

15

MW

Sponge

iron plant

& grid



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B.4. Description of how the baseline scenario is identified and description of the identified

baseline scenario:

>>

As highlighted in the baseline methodology the determination of the baseline scenario requires us to

consider potential alternatives.

Step 1: Define the most plausible baseline scenario for the generation of heat and electricity using the

following baseline options and combinations

There are four waste heat baselines in the methodology, namely:

Baseline

Option Description Applicability Justification

W1

WECM is directly vented to

atmosphere without incineration

or waste heat is released to the

atmosphere or waste pressure

energy is not utilized

Not Applicable

This baseline option may be ruled

out as waste gas was incinerated

in after burning chamber (ABC)

before venting to the atmosphere.

W2

WECM is released to the

atmosphere (for example after

incineration) or waste heat is

released to the atmosphere or

waste pressure energy is not

utilized.

Applicable

API has been practicing this

alternative from the time of

commissioning of the DRI kiln.

This is a credible baseline as the

waste gas was released into the

atmosphere before the project

activity.7

W3 Waste energy is sold as an

energy source. Not Applicable

Not a credible baseline as the

waste gas was vented to the

atmosphere and not sold.

W4 Waste energy is used for

meeting energy demand. Not Applicable

No alternative use of waste gas

could be identified. Not a credible

baseline scenario as the waste gas

was vented to the atmosphere.

W5

A portion of the waste gas

produced at the facility is

captured and used for captive

electricity generation, while the

rest of the waste gas produced at

the facility is vented/flared.

Not Applicable

Not a credible baseline scenario

as the waste gas was vented to the

atmosphere.

W6

All the waste gas produced at

the industrial facility is captured

and used for export electricity

generation.

Not Applicable

Not a credible baseline scenario

as the waste gas was vented to the

atmosphere.

7 An undertaking from the project owner has been provided which states that the waste heat from the kiln was

released in the absence of the project activity.



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There are eight power baselines in the methodology:

Baseline

Option Description Applicability Justification

P1

Proposed project activity not

undertaken as a CDM project

activity

Applicable but

automatically

included

Without the registration of the

project as a CDM, the project

would not be feasible as shown in

Section B.5. This is however

included as a baseline scenario.

P2 On-site or off-site existing/new

fossil fuel fired cogeneration plant Not Applicable

Not a credible baseline as waste

heat is not required by the sponge

iron process and hence no

cogeneration takes place.

P3

On-site or off-site existing/new

renewable energy based

cogeneration plant

Not Applicable

This is not a credible baseline

scenario as no cogeneration takes

place.

P4


fossil fuel based existing captive or

identified plant

Applicable

Since fossil fuels are available in

the vicinity of the project and there

are no national or sectoral policies

enforcing usage of fossil fuels, this

is considered a plausible baseline

scenario.

P5


renewable energy or other waste

energy based19 existing captive or

identified plant.

Not Applicable

As per the methodology the

baseline options that depend on

fuels that are not available at the

project site, should be excluded.

We can therefore exclude wind

and hydro as these resources are

not available abundantly in the

state. The establishment of these

types of units is more suitable

conditions in other states and

wheeling over the grid is currently

prohibited in Chhattisgarh.

P6 Sourced Grid-connected power

plants Applicable

This baseline scenario is

applicable as the sponge iron plant

imported electricity from the grid

before implementation of the

project8 and grid power is

available without any investment

cost.

P7

Captive Electricity generation using

waste energy (if project activity is

captive generation using waste

Not Applicable


waste gas in the baseline was

being released in the atmosphere

8 Electricity import bills have been provided to the validator during the site visit.



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energy, this scenario represents

captive generation with lower

efficiency than the project activity.)

and this would continue in the

absence of the project activity.

Electricity would have been

imported from the grid and

therefore this is not a credible

baseline scenario.

P8

Cogeneration using waste energy (if

project activity is cogeneration with

waste energy, this scenario

represents cogeneration with lower

efficiency than the project activity)

Not Applicable


project activity is not a

cogeneration system and no heat is

required by the sponge iron

process.

P9

Existing power generating

equipment (used previous to

implementation of project activity

for captive electricity generation

from a captured portion of waste

gas) is either decommissioned to

build new more efficient and larger

capacity plant or modified or

expanded (by installing new

equipment), and resulting in higher

efficiency, to produce and only

export electricity generated from

waste gas.20 The electricity generated

by existing equipment for captive

consumption is now imported from

the grid

Not Applicable No existing power generating

equipments exist.

P10


equipment (used previous to

implementation of project activity

for captive electricity generation

from a captured portion of waste

gas) is either decommissioned to

build a new more efficient and larger

capacity plant or modified or

expanded (by installing new

equipment), and resulting in higher

efficiency, to produce electricity

from waste gas (already utilized

portion plus the portion

flared/vented) for own consumption

and for export.


equipments exist.

P11


equipment is maintained and

additional electricity generated by

grid connected power plants.


equipments exist.



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With respect to heat generation nine baseline scenarios have been given in the methodology but since the

project activity is generation of electricity only, these have not been considered.

With respect to mechanical energy, five baseline scenarios have been given in the methodology but since

the project activity does not result in production of mechanical energy, these have not been considered.

An analysis to determine the economically attractive alternative is done to identify the baseline scenario.

This analysis is based on the February 2004 – “Report of Expert Committee on fuels for power

generation” by Planning Wing, Central Electricity Authority, Government of India.

P6 Sourced grid connected power plants

Capital cost (Rs crore/ MW) 0

Cost of import (Rs/ kWh) 2.41+ Fixed demand charge (electricity tariff at which the

sponge iron plant imported electricity in the absence of

the project activity)

Conclusion This scenario is economically attractive as no capital

investment is required.

P4 On-site or off-site existing/new fossil fuel based

existing captive or identified plant

Coal based captive power generation on site

Capital cost of power plant (Rs crore/ MW) 4.09

Cost of generation at 80% PLF (Rs/ kWh) 1.5810

(At 200km between the source and load centre) the

project activity is located in Chhattisgarh where coal can

be procured from South Eastern Coal Fields Ltd.11

Conclusion High capital investment but cost of power generation is

low.

On-site or off-site existing/new fossil fuel based

existing captive or identified plant

Diesel based captive power generation on site

Capital cost of power plant (Rs crore/ MW) 3.58

Cost of generation at 80% PLF (Rs/ kWh) 5.969 (At load centre)

Conclusion Financially unattractive option

The project participant shall exclude baseline options that:

Do not comply with legal and regulatory requirements; or

Depend on fuels (used for generation of heat, power or mechanical energy), that are not

available at the project site.

9 Page (xi) of the “Report of Expert Committee on fuels for power generation”

10 Page (vi) of the “Report of Expert Committee on fuels for power generation”

11 http://www.secl.nic.in/mcoalfields.htm

http://www.secl.nic.in/mcoalfields.htm



page 15

In terms of the alternatives mentioned all conform to local and national policies and are therefore

probable. There is no enforcement of power generation in sponge iron plants in Chhattisgarh. There are

also no restrictions on establishing captive power plants or importing electricity from the grid.

We can rule out natural gas as if it were available locally it would also be used in the sponge iron

manufacturing process.

Coal based captive power plant is a lucrative baseline scenario as cost of generation is low but as per the

methodology – “As a conservative approach, the available fuel with the lowest carbon emission factor

(e.g. natural gas) shall be used” and a coal baseline would be less conservative than grid based

generation. We may therefore rule out the alternative baseline scenario P4 on the basis of remaining

conservative. Hence the power baseline has been chosen as P6. However the investment comparison in

Section B.5 has been done by comparing the waste heat recovery system with a coal based captive power

plant.

Analyzing the alternatives above, the scenario that results from P6 and W2 is Scenario 1 for generation

of electricity:

Scenario Waste Gas Power Heat Description of situation

1 W2 P6 Not relevant The electricity is obtained from

the grid and the waste gas was

released to the atmosphere.

The project activity therefore gives rise to emission reductions through the displacement of grid based

power generation sources in the supply of electricity to the sponge iron plant and to the Chhattisgarh

State Electricity Board.

B.5. Description of how the anthropogenic emissions of GHG by sources are reduced below

those that would have occurred in the absence of the registered CDM project activity (assessment

and demonstration of additionality): >>

The following section demonstrates that the project activity is not part of the baseline scenario by

drawing on the latest version 05.2 of the “Tool for the demonstration and assessment of additionality”.

Step 1 – Identification of alternatives to the project activity consistent with current laws and

regulations

Sub-step 1a: Define alternatives to the project activity

The demonstration of the baseline scenarios (in section B4) incorporated the steps contained within this

section and therefore to summarise the conclusions of the baseline scenario it was shown that the

alternatives may be limited to the project activity not undertaken as a CDM and the supply of electricity

from the grid.

Sub-step 1b: Consistency with mandatory laws and regulations



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In terms of the alternatives identified above, all conform to local and national policies and are therefore

probable. There is no enforcement of power generation in sponge iron plants. There are also no

restrictions on establishing captive power plants or importing electricity from the grid.

Step 2 – Investment analysis

Sub –step 2a – Determine appropriate analysis method

Investment comparison analysis (Option II) has been used to demonstrate additionality of the project.

The project owners have identified the unit cost of service (levelized cost of electricity production in

Rs/MWh) as the most important financial indicator.

Sub-step 2b – Option II Apply investment comparison analysis

Project proponent have identified unit cost of service (i.e. levelized cost of electricity production in

Rs./kWh) as most suitable financial indicator for the project type and decision making context.

Sub-step 2c. Calculation and comparison of financial indicators

The project activity waste heat recovery power system of 8MW has been compared to a coal based power

system of 13MW. The major parameters used in the analysis are as follows:

WHRB Based Power Plant

S. No. Parameter Value Unit Source

1 PLF 85 % Assumed. Verified against other

CDM projects which have been

issued CER’s

2 Operating days 300 Days Calculated. Verified against

historical operating days.

3 Debt Component 70 % CERC Tariff Order

4 Equity Component 30 % CERC Tariff Order

5 Auxiliary Consumption 10 % CERC Tariff Order

6 Depreciation on buildings 3.34 % Indian Companies Act 1956

7 Depreciation on plant and

machinery

5.28 % Indian Companies Act 1956

8 Interest rate on term loan 7.75 % Loan approval document

9 Interest rate on working capital 10 % Loan approval document

10 Repair & Maintenance cost 2.5 % CERC Tariff Order

11 Escalation in O & M 4 % CERC Tariff Order

12 Deficit power cost 2,500 Rs/MWh CSEB cost

Contracted power demand 2 MVA Old electricity bills

Minimum demand charge 260 Rs/kVA Old electricity bills



page 17

AFBC Based Power Plant

S. No. Parameter Value Unit Source

1 PLF 95 % NTPC Press Release

2 Operating days 350 Days Assumed

3 Debt Component 70 % CERC Tariff Order

4 Equity Component 30 % CERC Tariff Order

5 Auxiliary Consumption 10 % CERC Tariff Order

6 Depreciation on buildings 3.34 % Indian Companies Act 1956

7 Depreciation on plant and

machinery

5.28 % Indian Companies Act 1956

8 Interest rate on term loan 7.75 % Loan approval document

9 Interest rate on working

capital

10 % Loan approval document

10 Repair & Maintenance cost 2.5 % CERC Tariff Order

11 Escalation in O & M 4 % CERC Tariff Order

12 Backup power cost 0 Rs million

13 Deficit power cost 0 Rs/MWh

14 Cost of coal fines 800 Rs/ tonne Chhattisgarh Market Price 2005

15 Cost of char 50 Rs/ tonne Transportation and handling

costs

16 Cost of dolochar 50 Rs/ tonne Transportation and handling

costs

17 Coal fines required per MWh 0.840 tonnes/MWh Technical Consultant letter

18 Char required per MWh 0.373 tonnes/MWh Technical Consultant Letter

19 Dolochar required per MWh 0.373 tonnes/MWh Technical Consultant Letter

As per the values and calculations provided the comparative levelized unit cost of services is found as

below:

Levelized cost of power with WHRB without CDM support at 85% PLF: Rs 1,367/MWh

Levelized cost of power with AFBC without CDM support at 95% PLF : Rs 990/MWh

Levelized cost of power with WHRB with CDM support at 85% PLF : Rs 614/MWh

The choice for a project proponent establishing a captive power generation facility is to establish a route

by which the cost of power is minimized and the availability and reliability of power is maximized. The

WHRB power is available for a maximum of 300 days as the WHR boiler shuts down with the shutdown

of the sponge iron kiln. The sponge iron kiln has to be cleaned every 46 days to prevent corrosion. The

cleaning takes a maximum of 10 days and hence the operating days have been taken at a maximum of

300days. Whereas the power from a coal based power plant would be available for 350days. In addition

the lower plant load factor (PLF) in a WHR boiler makes power availability a risk for the project owner.

Whereas the coal based captive power plant would normally operate at a PLF of 95%. Hence a captive

power project proponent setting up a WHRB power plant would also require spending a substantial

amount in procurement of backup power from the grid, for which they will have to pay additional

demand charges, in Chhattisgarh at the rate of Rs.260/kVA.



page 18

Comparing the cost required to set up a WHR plant and an AFBC plant, it was found that cost per MW

for a waste heat recovery system supports the project owner’s decision to set up a coal based power

system.

On making a clear comparison of the financial indicators for the proposed project activity and alternative

used, it is found that the coal based captive power plant has the lowest cost of power, hence the project

activity cannot be considered as the most financially attractive option.

The project owners have made an economic comparison of “the unit cost of electricity generation” from

the project activity with that of a 13 MW coal based power plant for the following reasons:

1. The 8MW waste heat recovery power plant with a maximum of 85% PLF, along with back up

grid support to draw the deficit energy to make up for fluctuations in generation and 7MW coal

based power plant with 95% PLF, can provide an equivalent level of electricity generation as

compared to a 13MW coal based power plant with 95% PLF which is the baseline (to be

conservative the baseline has been taken as the grid).

2. It is technically not possible to generate the same amount of power from an 8MW WHRB and an

8MW AFBC boiler.

Even comparing an 8MW waste heat recovery system with 95% PLF to a 8MW coal based power system

with 95% PLF it was found that the coal based system was a financially more attractive option and hence

the preferred choice for project owners.

Hence the 8MW project activity compared to a 13MW coal based system to provide same level of output

is justified.

Sub-step 2d. Sensitivity Analysis

Coal should have a analysis of fixed carbon (% ash, % volatile matter and % moisture deducted from

100%) above 40. The fixed carbon is the % of usable carbon of coal in the process and for lower fixed

carbon coal; the usage of coal per ton of ore charged is higher. The sponge iron kiln has a fixed hourly

charge weight of ore, coal and dolomite. So poor quality coal means a higher ore to coal ratio, which

refers to lower ore charging rate. This leads to lower production of sponge iron and lower generation of

waste gas per hour.

For a rotary kiln coal based sponge iron manufacturing process to be successful, it is absolutely essential

to use non coking coals having high reactivity characteristics and high ash fusion temperatures12

. But

Indian non coking coal does not satisfy the above criteria and therefore lead to less capacity utilization of

the sponge iron plant, which in turn is the reason for low PLF of the waste heat based power plant.

Reduction in capacity utilization results in reduction in power generation capacity thereby affecting the

project activity’s financial viability.

12This has been established in a research paper available on the website www.steelworld.com. The paper has been

provided to the validator.

http://www.steelworld.com/



page 19

The comparative cost of power at 75%, 80%, 85% and 90% PLF for WHRB has been considered,

however as per the practical experience in WHRB operating with Sponge Iron Plants in the region, it is

experienced that the normal PLF achievable from WHRB is at an average of 75%13

.

However for the sake of the sensitivity an analysis in terms of cost of power from WHRB with a 75%,

80%, 85% and 90% PLF was carried out without CDM support, and it was found to be higher than coal

based power plant, where as with CDM support the cost of power from WHRB is reduced below that of

coal based captive power plant.




Levelized cost of power with AFBC without CDM support at 95% PLF : Rs 990/MWh


Levelized cost of power with WHRB with CDM support at 85% PLF : Rs 614/MWh

This sensitivity analysis conclusively establishes that the coal based captive power plant is financially

more attractive than WHRB based power (without CDM). Therefore the project is found to be

additional.

Step 3 – Barrier analysis

Investment analysis has been undertaken.

Step 4. Common practice Analysis

Sub-step 4a. Analyze other activities similar to the proposed project activity:

The following table details the sponge iron plants in the state of Chhattisgarh and indicates whether they

have or are in the process of installing waste heat recovery boilers14

. In line with the tool and the

guidance from the Executive Board15

the proposed and registered CDM project activities have not been

included in the analysis.

SPONGE IRON PLANTS IN THE STATE OF CHHATTISGARH

S.

No.

Company Name District Kiln

Capacity

(tpdx300

days)

WHRB Whether

CDM?

1 Agrawal Sponge Pvt. Ltd Raipur 0.60 No No

2 Aryan Ispat & Power Ltd Bilaspur 0.60 No No

13 An analysis of the PLF achieved by projects registered with the UNFCCC has been provided to the validator.

14 This data has been taken from a study conducted by the project owners’ consultants with help from internet data,

local and internal sources.

15 CDM EB 38 paragraph 60



page 20

3 Anjani Steels Pvt. Ltd. Raigarh 0.72 No No

4 B.S. Sponge Iron Ltd. Raigarh 0.60 No No

5 Bhagwati Power & Steel Pvt. Ltd. Raipur 0.60 No No

6 Gopal Sponge & Power (P) Ltd. Raipur 0.60 No No

7 Harsh Sponge Raipur 0.60 No No

8 HEG Limited Durg 1.20 Yes No

9 Maa Shakambari Steel Ltd. Raigarh 0.60 No No

10 Niro’s Ispat (P) Ltd Durg 0.90 No No

11 N.R. Sponge Pvt. Ltd Raipur 0.60 No No

12

Nutan Ispat & Power

Pvt. Ltd. Raipur 0.60 No No

13 Shidhi Vinayak Sponge Iron (P) Ltd. Raigarh 0.60 No No

14 Shiv Shakti Steel Ltd. Raigarh 0.98 No No

15 Shivalaya Ispat & Power (P) Ltd Raipur 0.60 No No

16 Shri Shyam Ispat (I) Pvt. Ltd. Raigarh 0.60 No No

17

S.K. Saraogi &

Company Pvt. Ltd. Raipur 0.60 No No

18 Sunil Sponge Pvt. Ltd. Raipur 0.60 No No

19 Trimula Sponge Ltd. Raipur 0.60 No No

Sub-step 4b. Discuss any similar options that are occurring:

Out of the 19 sponge iron plants listed above only 4 are operating at a scale similar (Anjani Steels Pvt.

Ltd., HEG Limited, Niro’s Ispat (P) Ltd. and Shiv Shakti Steel Ltd.) to the project activity. Kiln capacity

of project is 1.05 lakh tons. Of these only HEG Limited has installed a Waste Heat Recovery System but

this started operation in March 199716

when CDM benefits were not available and HEG Limited is an old

and financially healthy company set up in 1977. Other plants of a lower capacity also do not have waste

heat recovery systems clearly highlighting the importance of CDM in commissioning of such project

types.

Till date the implementation of waste heat recovery has mainly taken place amongst the larger plants and

all are being commissioned on the basis of CDM funding. From the above it is clear that the proposed

project activity is not a common practice in the state.

Based on the above facts, it is evident that the project activity is additional and requires CDM revenues

to overcome the barriers discussed above.

16 http://www.hegltd.com/pp/whr_plant.aspx



page 21

Consideration of CDM

As the validation occurs after the start date of the project activity we are required to demonstrate that

CDM was considered in the decision of the project owner to undertake the project. Throughout the

process of implementing the project activity the project owner had clearly stated their intention to follow

CDM for the project activity, the minutes of Board Meeting and the subsequent Directors’ report for the

year 2004/05 clearly states the company’s intention to follow CDM. Furthermore the director of API had

consulted and discussed with Shri Bajrang Power & Ispat Ltd., one of the companies that proposed the

initial methodology, ACM0004, on the aspects relating to the application of CDM and the installation of

waste heat recovery systems when they were deciding to invest in their power plant in 200417

. The

project owners had also discussed the possibility of CDM applicability with CDM consultants in 2005/06

and after further negotiations, signed a contract with Agrinergy Ltd. for CDM services on 7th July 2006

18.

The project activity was delayed in its application as a CDM due to complications with the application of

the methodology. Initially the project was developed using ACM0004 but this methodology was not felt

to be applicable given the constraints on its application for dual fuel systems, in particular the continuous

measurement of the enthalpy of the gases. One of the project participants to this project activity had

therefore requested a revision to the methodology in November 2006, AM_REV_0033, for a similar

project that they were working on. This revision was approved at EB31 in May 2007 but as the

methodology was being consolidated by the Meth panel it was decided by the EB to hold incorporate the

revision into the consolidated version that was to be submitted at EB32 in June 2007. Subsequent to

EB32 a new consolidated version of the methodology was issued, ACM0012, but this was again revised

at EB35 in October 2007. The development of the PDD has therefore been delayed by this process.

The complete chronology of events is given below which proves that real and continuing actions were

taken by the project owners to secure CDM status.

Date Activity

02/12/2004 Meeting of board of directors to undertake the waste heat recovery power plant as

CDM project – CDM Consideration

09/12/2004 NOC issued by Gram Panchayat to set up sponge iron plant

13/12/2004 Permission to establish the sponge iron plant and power plant

24/12/2004 Letter from Mr. Narendra Goel (Shri Bajrang Power & Ispat Ltd.) to Mr. Anil

Agarwal (Director API Ispat & Power Ltd.) – Third party evidence

02/02/2005 Turbine generator – Purchase Order to Bharat Heavy Electricals Ltd.

07/02/2005 Letter from Shree Nakoda Ispat Ltd to API suggesting that they avail CDM benefits

for setting up the WHR system – Third party evidence

26/02/2005 Waste heat Recovery Boiler Purchase Order

02/03/2005 Public inputs invited by UN for new meth submission NM0087

07/03/2005 Boiler erection order

08/04/2005 Meth Panel (MP15) suggests the EB to incorporate the new meth submission

NM0087 by one of the project participants but does not include the ability to claim

CERs for dual fuel systems

17A letter from Shri Bajrang Power & Ispat Ltd to API Ispat Powertech Pvt Ltd has been provided to the validator.

18 A copy of the contract has been provided to the DOE.



page 22

13/05/2005 EB 19 incorporates the meth submission

27/05/2005 Sanction of loan from State Bank of Travancore

22/09/2005 Work order for civil construction of power plant

17/11/2005 Email from API Ispat to Agrinergy

27/04/2006 Consent to operate the sponge iron plant

28/04/2006 Email from Agrinergy to API Ispat

07/07/2006 Contract signed with Agrinergy to develop the CDM project

23/10/2006 NOC issued by Gram panchayat for setting up power plant and applying for carbon

credits

27/11/2006 Request submitted for revision of ACM0004 by one of the project participants –

AM_REV_0033

07/12/2006 Permission for synchronization with Chhattisgarh State Electricity Board grid

27/02/2007 Amendment in consent to operate for Waste Heat Recovery Based Power Plant

03/06/2007 Synchronization of power plant with grid

12/06/2007 Power purchase agreement with Chhattisgarh State Electricity Board

22/06/2007 EB 32 approves the methodology ACM0012

19/10/2007 EB35 revises the methodology ACM0012

19/01/2008 Baseline and monitoring study completed

07/03/2008 PDD version 1

23/04/2008 Proposals from various DOE requested

08/05/2008 Validation Contract signed with the DOE

B.6. Emission reductions:

B.6.1. Explanation of methodological choices:

>>

The methodology requires us to measure the net generation arising from the waste heat recovery unit and

multiply this by an appropriate carbon dioxide emission factor to arrive at the baseline emissions. In the

case of the project activity the turbine is fed from two boilers, one waste heat recovery boiler and one

coal based AFBC boiler. The apportioning of the generation is carried out as outlined in the

methodology, on the basis of the steam supplied by these units.

Baseline emissions

The baseline emissions for the year y shall be determined as follows:

yflstyEny BEBEBE ,, (1)

Where:

BEy Total baseline emissions during the year y in tons of CO2

BEEn,y Baseline emissions from energy generated by project activity during the year y in tons of

CO2

BEflst,y Baseline Emissions from steam generation, if any, using fossil fuel that would have been

used for flaring the waste gas in the absence of the project activity (tCO2e per year). This



page 23

is relevant for those project activities where in the baseline steam is used to flare the

waste gas.

Since in the baseline steam was not used to flare waste gas, the equation is reduced to:

yENy BEBE ,

The project falls under scenario 1 of the methodology – “

Scenario 1 represents the situation where the electricity is obtained from a specific existing power plant

or from the grid, mechanical energy (displaced waste energy based mechanical turbines in project) is

obtained by electric motors and heat from a fossil fuel based element process (e.g. steam boiler, hot

water generator, hot air generator, hot oil generator).”

yTheryElecyEn BEBEBE ,,, (1a)

Where:

BEelec,y Baseline emissions from electricity during the year y in tons of CO2

BETher,y Baseline emissions from thermal energy (due to heat generation by element process)

during the year y in tons of CO2

a) Baseline emissions from electricity (BEelectricity,y) Type – I activities

yjiElecyji

j i

wcmcapyElec EFEGfCfBE ,,,,,, (1a-1)

Where:

BEelec,y Baseline emissions due to displacement of electricity during the year y in tons of CO2

EGi,j,y The quantity of electricity supplied to the recipient j by generator, that in the absence of

the project activity would have been sourced from ith source (i can be either grid or

identified source) during the year y in MWh, and

EFelec,i,j,y The CO2 emission factor for the electricity source i (i=gr (grid) or i=is (identified

source)), displaced due to the project activity, during the year y in tons CO2/MWh

fwcm Fraction of total electricity generated by the project activity using waste energy. This

fraction is 1 if the electricity generation is purely from use of waste energy. If the boiler

providing steam for electricity generation uses both waste and fossil fuels, this factor is

estimated using equation (1d). If the steam used for generation of the electricity is

produced in dedicated boilers but supplied through common header, this factor is

estimated using equation (1d/1e). Note: For project activity using waste pressure to

generate electricity, electricity generated from waste pressure use should be measurable

and this fraction is 1

fcap Energy that would have been produced in project year y using waste energy generated in

base year expressed as a fraction of total energy produced using waste source in year y.

The ratio is 1 if the waste energy generated in project year y is same or less than that

generated in base year. The value is estimated using equations (1f), or (1f-1) or (1f-2), or

(1g), (1g-1) or (1h)



page 24

b) Baseline emissions from thermal energy (BETher,y)

The project activity is the generation of electricity only and hence this sub-section has not been used for

estimating the baseline emissions.

Calculation of the energy generated (electricity) in units supplied by WECM and other fuels

Situation 2

This situation is used as the steam generated with different fuels in dedicated boilers are fed to turbine

through common steam header and takes into account that the relative share of the total generation from

waste gas is calculated by considering the total steam produced and the amount of steam generated from

each boiler.

yotherywhr

ywhr

wcmSTST

STf

,,

, (1e)

Where:

STwhr,y Energy content of the steam generated in waste heat recovery boiler fed to turbine via

common steam header

STother,y Energy content of the steam generated in other boilers fed to turbine via the common

steam header

Capping of baseline emissions

As an element of conservativeness baseline emissions have to be capped irrespective of planned/

unplanned or actual increase in output of plant, as per the methodology. The methodology provides three

methods for the determination of the parameter fcap. Method – 3 has been used as it is difficult to

measure the waste energy and hence no historic data is available. For the proposed activity we apply the

Case I approach as the project involves the capture of waste heat in waste heat recovery equipment

(boiler) that converts the energy into steam. Energy is subsequently converted into electricity (i.e. final

output energy) which provides a reliable basis for determination of fcap and monitoring.

Case 1: The energy is recovered from WECM and converted into final output energy through waste heat

recovery equipment. For such cases fcap should be the ratio of actual energy recovered under the

project activity (direct measurement) divided by the maximum theoretical energy recoverable using the

project activity waste heat recovery equipment. For estimating the theoretical recoverable energy,

manufacturer’s specifications can be used. Alternatively, technical assessment can be conducted by

independent qualified/certified external process experts such as chartered engineers.

For estimating the theoretical recoverable energy, manufacturer’s specifications can be used and the

following equation will be used:

yOE

BLOE

capQ

Qf

,

, (1h)



page 25

Where:

QOE,BL Output/intermediate energy that can be theoretically produced (in appropriate unit), to be

determined on the basis of maximum recoverable energy from the WECM, which would

have been released (or WECM would have been flared or energy content of WECM

would have been wasted) in the absence of CDM project activity.

QOE,y Quantity of actual output/intermediate energy during year y (in appropriate unit)

In the case of the proposed project activity QOE,BL consists of the theoretical maximum electrical output

(in MW) that can be generated with the available waste heat, while QOE,y is the actual electrical output of

the project in year y (in MW).

In case of a planned expansion, a separate CDM project would be registered for additional capacity.

Project emissions and leakage

As the project activity does not involve the combustion of any other auxiliary fossil fuel to supplement

waste gas and neither is any electricity consumed for cleaning of waste gas before energy generation, the

project emissions are hence taken as zero.

In line with the methodology leakage is also zero.

Emission Reductions

Emission reductions are calculated by the following formula:

yyENy PEBEER , (3)

Where:

ERy Total emissions reductions during the year y in tons of CO2

PEy Emissions from the project activity during the year y in tons of CO2

BEEN,y Baseline emissions for the project activity during the year y in tons of CO2

Since the project emissions are zero the above formula is reduced to:

yENy BEER ,

We have adopted the approach specified in the “Tool to calculate the emission factor for an electricity

system” to calculate the emission factor of the Northern regional grid. The average of approximating

operating margin and build margin has been used for calculation of the baseline. The grid emission

factor has been obtained from the CO2 baseline database, Central Electricity Authority and is fixed ex-

ante at 0.79 tCO2/MWh and is calculated as shown in table below:

Calculation of the combined margin

tCO2/MWh

Operating Margin 0.99



page 26

Build Margin 0.59

Combined Margin 0.79

B.6.2. Data and parameters that are available at validation:

Data / Parameter: EFEleci,j,y

Data unit: tCO2/MWh

Description: The CO2 emission factor for the electricity source i (i=grid), displaced due to

the project activity, during the year y

Source of data used: Central Electricity Authority CO2 baseline database version 3

Value applied: 0.79

Justification of the

choice of data or

description of

measurement methods

and procedures

actually applied :

This value is for the Northern regional grid, provided by the Central Electricity

Authority (CEA), a government body.

Any comment: http://cea.nic.in/planning/c%20and%20e/Government%20of%20India%20webs

ite.htm

The value has been fixed ex-ante.

Data / Parameter: fcap

Data unit: Fraction

Description: Energy that would have been produced in project year y using waste energy

generated in base year expressed as a fraction of total energy produced using

waste source in year y. The ratio is 1 if the waste energy generated in project

year y is same or less than that generated in base year.

Source of data used: Calculated in accordance with Method-3, Case-1 as described in the

methodology

Value applied 1


choice of data or

description of

measurement methods

and procedures

actually applied :

The value of fcap has been calculated on the basis of the output that can

theoretically be produced on the basis of available waste heat when the sponge

iron kiln is operated under normal load factors and projected power output.

Any comment: This parameter is fixed ex-ante.

Data / Parameter: QOE,BL

Data unit: MW

Description: Output/intermediate energy that can be theoretically produced (in appropriate

unit), to be determined on the basis of maximum recoverable energy from the

WECM, which would have been released (or WECM would have been flared

or energy content of WECM would have been wasted) in the absence of CDM

project activity.

Source of data used: Manufacturer’s specification

http://cea.nic.in/planning/c%20and%20e/Government%20of%20India%20website.htm

http://cea.nic.in/planning/c%20and%20e/Government%20of%20India%20website.htm



page 27

Value applied 8


choice of data or

description of

measurement methods

and procedures

actually applied :

As per the methodology the manufacturer’s data has been used.

Any comment: This parameter is fixed ex-ante.

B.6.3 Ex-ante calculation of emission reductions:

>>

To be conservative the baseline scenario is determined to be the import of power from the regional grid.

In line with the methodology the emission reductions have been calculated using equations as in Section

B.6.

S. No. Parameter Explanation Unit Value

1 EGi,j,y The quantity of electricity supplied

to the recipient j by generator, that in

the absence of the project activity

would have been sourced from ith

source (i can be either grid or

identified source) during the year y

MWh 91,745

2 EFelec,i,j,y The CO2 emission factor for the

electricity source i (i=gr (grid) or

i=is (identified source)), displaced

due to the project activity, during the

year y

tCO2/MWh 0.79

3 fwcm Fraction of total electricity generated

by the project activity using waste

energy. This fraction is 1 if the

electricity generation is purely from

use of waste energy.

Fraction 0.458

4 fcap Energy that would have been

produced in project year y using

waste energy generated in base year

expressed as a fraction of total

energy produced using waste source

in year y

Fraction 1

5 BEelec,y Baseline emissions from electricity

during the year y

tCO2 29,904

6 BEEN,y Baseline emissions from energy

generated by project activity during

the year y in tons of CO2

tCO2 29,904

B.6.4 Summary of the ex-ante estimation of emission reductions:

>>



page 28

Year

Estimation of

project activity

emissions (tonnes

of CO2e)

Estimation of

baseline

emissions (tonnes

of CO2e)

Estimation of

leakage (tonnes of

CO2e)

Estimation of

overall emission

reductions

(tonnes of CO2e)

2009-2010 0 29,904 0 29,904

2010-2011 0 29,904 0 29,904

2011-2012 0 29,904 0 29,904

2012-2013 0 29,904 0 29,904

2013-2014 0 29,904 0 29,904

2014-2015 0 29,904 0 29,904

2015-2016 0 29,904 0 29,904

2016-2017 0 29,904 0 29,904

2017-2018 0 29,904 0 29,904

2018-2019 0 29,904 0 29,904

Total tonnes of

CO2e

0 299,040 0 299,040

B.7 Application of the monitoring methodology and description of the monitoring plan:

B.7.1 Data and parameters monitored:

Data / Parameter: EG,i,j,y

Data unit: MWh

Description: The quantity of electricity supplied to the recipient j by generator, that in the

absence of the project activity would have been sourced from ith source (i can be

either grid or identified source) during the year y

Source of data to be

used:

Plant records

Value of data applied

for the purpose of

calculating expected

emission reductions in

section B.5

91,745

Description of

measurement methods

and procedures to be

applied:

The plant will install energy meter and meter reading will be taken on a shift

wise basis and collated daily by the shift operator. This monitored data will be

collated into a monthly report from which the emission reductions will be

calculated.

QA/QC procedures to

be applied:

The meters will be calibrated annually by an independent third party.

Any comment: All data will be kept for a period 2 years after the end of the crediting period.

Data / Parameter: EGAUX

Data unit: MWh

Description: Auxiliary consumption of the power plant


used:

Plant records



page 29


for the purpose of



section B.5

9,175

Description of

measurement methods


applied:

The plant will install auxiliary meter and reading will be taken on a shift wise

and daily basis by the shift operators. These recordings will be collated into a

monthly report from which the emission reductions will be calculated.

QA/QC procedures to

be applied:

The meter will be calibrated annually by independent third party.


Data / Parameter: EGNet

Data unit: MWh

Description: Net electricity generation by the power plant


used:

Calculated


for the purpose of



section B.5

82,571

Description of

measurement methods


applied:

EG,i,j,y - EGAUX

QA/QC procedures to

be applied:

--


Data / Parameter: QWG,y

Data unit: Nm3

Description: Quantity of waste gas used for energy generation during year y


used:

Plant records


for the purpose of



section B.5

The parameter is not used in calculation of emission reductions

Description of

measurement methods


applied:

It is difficult to measure the waste gas before point of use (i.e. waste heat

recovery boiler) hence a meter has been put up between stack and WHRB. The

conditions as per methodology have been met:

Demonstration of technical limitation that prevents measurement of

waste gas at inlet of WHRB



page 30

The flow meter will be calibrated according to temperature and pressure

of waste gas at monitoring point.

QA/QC procedures to

be applied:


Data / Parameter: STWHR,y

Data unit: kcal/kg

Description: Energy content of the steam generated in waste heat recovery boiler fed to

turbine via common steam header


used:

Steam Tables


for the purpose of



section B.5

531,244,560

Description of

measurement methods


applied:

As per the methodology this has to be recorded as kcal/kg which is total energy.

This has been calculated by multiplying energy in steam (using steam tables for

temperature and pressure of steam) and the measured amount of steam from the

WHRB.

QA/QC procedures to

be applied:

Not applicable as per the methodology


Data / Parameter: STother,y

Data unit: kcal/kg

Description: Energy content of the steam generated in other boilers fed to turbine via common

steam header


used:

Steam Tables


for the purpose of



section B.5

627,581,520

Description of

measurement methods


applied:

As per the methodology this has to be recorded as kcal/kg which is total energy.

This has been calculated by multiplying energy in steam (using steam tables for

temperature and pressure of steam) and the measured amount of steam from the

AFBC.

QA/QC procedures to

be applied:

Not applicable as per the methodology


Data / Parameter: Tempwg

Data unit: °Celsius



page 31

Description: Temperature of steam from waste heat recovery boiler


used:

Plant records


for the purpose of



section B.5

490

Description of

measurement methods


applied:

The temperature of the steam will be monitored at the outlet of waste heat

recovery boiler. The DCS system installed at the plant will directly measure the

temperature of steam from WHRB boiler and readings taken hourly manually.

This will be collated at the end of the 8 hour shift and then at the end of the day.

QA/QC procedures to

be applied:

--

Any comment: Recorded to calculate energy in steam from waste gas

Data / Parameter: Pressure wg

Data unit: kg/cm2

Description: Pressure of steam from waste heat recovery boiler


used:

Plant records


for the purpose of



section B.5

60

Description of

measurement methods


applied:

The DCS system installed at the plant will directly measure the pressure of steam

at the outlet of WHRB boiler and readings taken hourly manually. This will be

collated at the end of the 8 hour shift and then at the end of the day.

QA/QC procedures to

be applied:

--

Any comment: Recorded to calculate energy in steam from waste gas

Data / Parameter: QuantityWG

Data unit: tonnes per hour

Description: Quantity of steam from waste heat recovery boiler


used:

Plant records


for the purpose of



section B.5

38

Description of

measurement methods

The waste heat recovery boiler will have a steam flow meter at the steam

pipeline before turbine at the main powerhouse building. The DCS system



page 32


applied:

installed at the plant will directly measure the steam flow from the WHRB.

QA/QC procedures to

be applied:

--

Any comment: --

Data / Parameter: Temp other

Data unit: °Celsius

Description: Temperature of steam from other boiler


used:

Plant records


for the purpose of



section B.5

490

Description of

measurement methods


applied:

The DCS system installed at the plant will directly measure the temperature of

steam from other boiler and readings taken hourly manually. This will be

collated at the end of the 8 hour shift and then at the end of the day.

QA/QC procedures to

be applied:

--

Any comment: Recorded to calculate energy in steam from other boiler

Data / Parameter: Pressure other

Data unit: kg/cm2

Description: Pressure of steam from other boiler


used:

Plant records


for the purpose of



section B.5

66

Description of

measurement methods


applied:

The DCS system installed at the plant will directly measure the pressure of steam

at the outlet of other boiler and readings taken hourly manually. This will be

collated at the end of the 8 hour shift and then at the end of the day

QA/QC procedures to

be applied:

--

Any comment: Recorded to calculate energy in steam from other boiler

Data / Parameter: Quantityother

Data unit: tonnes per hour

Description: Quantity of steam from other boiler

Source of data to be Plant records



page 33

used:


for the purpose of



section B.5

45

Description of

measurement methods


applied:

The AFBC boiler will have a steam flow meter at the steam pipeline before

turbine at the main powerhouse building. The DCS system installed at the plant

will directly measure the steam flow from the AFBC boiler.

QA/QC procedures to

be applied:

--

Any comment: To calculate energy in steam from other boiler. The boiler efficiency has been

taken as 85%.

B.7.2 Description of the monitoring plan:

>>

The sponge iron plant which supplies the waste gas and the power plant both are ISO 9001:2000

accredited. The following procedures will be implemented for the monitoring of the project activity in

order to provide a calculation of the Emission Reductions (ERs) arising from the project activity.

As highlighted in section B.6.1 of the PDD the quantity of emission reductions is given by the product of

the total electrical power generation and the grid carbon dioxide emission factor taking into account the

capping factor and the apportioning factor.

Metering is provided for all the data within the monitoring plan and regular calibration of the meters will

take place. The energy meters will be checked and calibrated on an annual basis and calibration

certificated will be provided to the DOE during verification. The transmitters will be calibrated annually,

however it should be noted that these do not have an accuracy class. The calibrating equipments used

conform to national standards and if percentage error is not within permissible limits it is shown as such

and necessary steps would be taken to replace the meters.

The meter readings will be taken by the shift operator in charge and the DCS operators and signed off

daily and monthly by the power plant manager. Once this data is signed off it will be transmitted to

Agrinergy to form the basis of monthly calculations of the emission reductions.

The monitoring of the temperature, pressure and flow of the steam used to calculate the parameters STwg

and STother will be taken from the DCS system on site. The DCS will convert the flow of steam to a

standard temperature and pressure, adjusted flow, and therefore from this adjusted flow the calculation of

STwg and STother will be relatively straightforward. The actual flow and temperature and pressure of the

steam sources will be continuously recorded (every second) by the DCS but records of this data will be

maintained on a hourly, shift wise and monthly basis. The calculation of the energy content of the

different steam sources will be performed monthly.

An internal audit will be carried out at the project site annually wherein it will be verified that the data is

being monitored and compiled in accordance with the PDD. Based on audits, corrective actions will be

taken to coordinate for further effectiveness.



page 34

All monitored data will be kept for a minimum of two years after the end of the crediting period and will

be archived electronically. 100% of the data will be monitored.

B.8 Date of completion of the application of the baseline study and monitoring methodology

and the name of the responsible person(s)/entity(ies)

>>

19/01/2008

Bhawna Singh

Agrinergy Consultancy Pvt Ltd

[email protected]

The entity is not a project participant

Mr. Anil Kumar Aggarwal, API Ispat & Powertech Pvt Ltd, project participant, contact details as listed

in Annex I.

mailto:[email protected]



page 35

SECTION C. Duration of the project activity / crediting period

C.1 Duration of the project activity:

C.1.1. Starting date of the project activity:

>>

02/02/2005

This refers to the date of turbine generator purchase order.

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

>>

20y-00m

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

A fixed ten year crediting period has been chosen.

C.2.1. Renewable crediting period

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

>>

This section has been left blank on purpose.

C.2.1.2. Length of the first crediting period:

>>

This section has been left blank on purpose.

C.2.2. Fixed crediting period:

C.2.2.1. Starting date:

>>

01/10/2009 or Date of registration (whichever is later)

C.2.2.2. Length:

>>

10y-00m



page 36

SECTION D. Environmental impacts

>>

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

impacts:

>>

In relation to the baseline scenario no negative environmental impacts will arise as a result of the project

activity. The baseline scenario involves the combustion of coal and other fossil fuels for the generation of

grid based power. The baseline scenario therefore generates carbon dioxide, NOx, SOx and ash.

The positive environmental impacts arising from the project activity are therefore:

A reduction in carbon dioxide emissions from the replacement of fossil fuels which would be

generated under the baseline scenario

A reduction in the emissions of other harmful gases (NOx and SOx) that arise from the

combustion of fossil fuels in power generation

The factory will meet all environmental legislations as set out by the State Pollution Control Board and

there will be on-going monitoring of the plant by this state body. A “Consent to Operate” will be taken

by the State Pollution Control Board for the project activity regularly.

The plant will install an electrostatic precipitator at the exit of the boiler as per the consents from

Chhattisgarh Environment Conservation Board (CECB) to limit suspended particulate matter in the flue

gases to less than 100 mg/Nm3. There will also be investment in waste water systems to treat the water

de-mineralization plant effluent and also the blow down water from the cooling tower and steam

generator.

Monitoring of air and water quality will be undertaken on a regular basis as per the State Pollution

Control Board guidelines after the plant is commissioned. The testing of the environmental parameters

will be undertaken by an independent third party.

An Environmental Impact Assessment (EIA) is not required for the power plant but the project owners

have voluntarily undertaken an EIA study from Anacon Laboratories Pvt Ltd, Nagpur which shows no

negative environmental impacts due to the project activity.

D.2. If environmental impacts are considered significant by the project participants or the host

Party, please provide conclusions and all references to support documentation of an environmental

impact assessment undertaken in accordance with the procedures as required by the host Party:

>>

The environmental impacts are not considered significant.



page 37

SECTION E. Stakeholders’ comments

>>

E.1. Brief description how comments by local stakeholders have been invited and compiled:

>>

The local stakeholder review has been conducted on two levels:

A local stakeholder review was conducted by consulting the Gram Panchayat of Siltara on 09th

December 2004. The meeting was attended by the village heads of the panchayat and a

unanimous decision was taken to provide a no objection certificate to the project activity19

.

Another no objection certificate was issued by the panchayat on 23rd

October 2006 to allow the

company to undertake the project as a CDM project activity.

A national stakeholder review is done through the approval by the Ministry of Environment and Forests

(the Indian DNA).

Other stakeholders that have been notified of the project, through consents and approvals required for the

investment, are the Chhattisgarh State Electricity Board through the Power Purchase Agreement and the

State Boiler and State Electrical Inspectorate which have visited the site to approve the plans and

construction.

E.2. Summary of the comments received:

>>

No comments have been received on the project to date.

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

>>

No comments were received hence no action has been taken.

19 A copy of the NOC, minutes of meeting and list of attendees have been provided to the validator during site visit.



page 38

Annex 1

CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY

Organization: API Ispat & Powertech Pvt Ltd

Street/P.O.Box: Main Rohtak Road

Building: D-15, Udyog Nagar

City: New Delhi

State/Region: New Delhi

Postfix/ZIP: 110041

Country: India

Telephone: 91-11-25471765-66

FAX: 91-11-25479387

E-Mail: [email protected]

URL:

Represented by:

Title: Director

Salutation: Mr.

Last Name: Aggarwal

Middle Name: Kumar

First Name: Anil

Department:

Mobile:

Direct FAX: 91-11-25479387

Direct tel: 91-11-25471765-66

Personal E-Mail: --



page 39

Organization: Agrinergy Pte Ltd

Street/P.O.Box: 10 Hoe Chiang Road

Building: #08-04 Keppel Towers

City: Singapore

State/Region:

Postfix/ZIP: 089315

Country: Singapore

Telephone: +65 6592 0400

FAX: +65 6347 6181

E-Mail:

URL: www.agrinergy.com

Represented by:

Title: Managing Director

Salutation: Mr

Last Name: Atkinson

Middle Name:

First Name: Ben

Department:

Mobile:

Direct FAX: +65 6592 0401

Direct tel: +65 6592 0398

Personal E-Mail: [email protected]

http://www.agrinergy.com/

mailto:[email protected]



page 40

Annex 2

INFORMATION REGARDING PUBLIC FUNDING

The project activity has not received any public funding.



page 41

Annex 3

BASELINE INFORMATION

We have adopted the approach specified in the tool to calculate the CO2 emission coefficient of the

electricity grid. The average of approximating operating margin and build margin has been used for

calculation of the baseline. The grid emission factor has been obtained from the Central Electricity

Authority, CO2 baseline database, version 03 and is fixed ex-ante at 0.79tCO2/MWh and is calculated as

shown in table below:

Calculation of the combined margin

tCO2/MWh

Operating Margin 0.99

Build Margin 0.59

Combined Margin 0.79



page 42

Annex 4

MONITORING INFORMATION

In addition to monitoring plan laid down in Section B.7.2, the monitoring of the project activity will be

the responsibility of power plant manager. The monitored data will be reported through him to Agrinergy

on a monthly basis for the calculation and estimation of emission reductions. This data will be checked

against initial estimates and a summary report will be provided quarterly by Agrinergy. If the project is

not performing as expected or if there are any negative impacts on the volume of emission reductions

obtained, on the basis of the monthly data being monitored, a report will be sent to API Ispat &

Powertech Pvt Ltd outlining where the project is deviating in its generation of emission reductions and

the immediate measures which need to be undertaken to maintain the expected generation of emission

reductions from the operation of this project. Should there be significant changes to the set-up or

operation of the plant, these will be notified to Agrinergy and amendments to the PDD will be requested

through a DOE.

At the end of each year of operation Agrinergy will prepare a monitoring report that will be submitted to

a DOE for verification, however visits to the site may be undertaken by Agrinergy during the first year to

check that the procedures and monitoring plan are being followed. All data will be kept for a minimum of

2 years following issuance of certified emission reductions or the end of the crediting period, whichever

is later, and the storage of this data will be the responsibility of the project developers.



page 43

Appendix 1

WHR power projects in Chhattisgarh state as per UNFCCC website:

S. No. Company Name

Kiln Capacity

lacs(tpdx300da

ys) District UN website link

1

Abhijeet Infrastructure

Limited 1.05 Raipur

http://cdm.unfccc.int/Projects/

Validation/DB/575321F3V2J3

1FK9NQT8YCMWKSKAX3/

view.html

2

Arti Sponge & Power Pvt.

Ltd. 0.60 Raipur


Validation/DB/GJLUXNB9N

TTDLKGWWR7ZGE0GMQS

T69/view.html

3 Corporate Ispat Alloys Ltd. 1.50 Raipur


Validation/DB/H0KUA7IOZU

VQCNUEWMFBOU2Z8FIQP

D/view.html

4

Crest Steel & Power

Pvt. Ltd. 1.05 Durg


Validation/DB/8BT6LBKZHD

5UJ1UH3P9508VCIIAW6O/v

iew.html

5

Drolia Electro Steel Pvt.

Ltd. 0.60 Raipur


Validation/DB/O05FAHI4CX

ZMS1SOENCSKKFW54ER1

D/view.html

6 G.R. Sponge & Power Ltd. 0.60 Raipur


DB/DNV-

CUK1178352647.53/view

7

Godawari Power & Ispat

Ltd. 4.95 Raipur


DB/SGS-

UKL1139564002.3/view

8 Hi-Tech Power& Steel Ltd. 0.60 Raipur


Validation/DB/FM79CDWNJ

UJC2WUUFG34AW54KCNC

QF/view.html

9 Ind Synergy Ltd. 2.10 Raigarh


DB/SGS-

UKL1168434870.74/view

10

Mahendra Sponge &

Power Pvt. Ltd. 0.60 Raipur


DB/DNV-CUK1179810034.49

11

Monnet Ispat & Energy

Ltd. 3.00 Raigarh


DB/SGS-

UKL1146048256.38/view

12 MSP Steel & Power 2.00 Raigarh http://cdm.unfccc.int/Projects/

http://cdm.unfccc.int/Projects/Validation/DB/575321F3V2J31FK9NQT8YCMWKSKAX3/view.html




http://cdm.unfccc.int/Projects/Validation/DB/GJLUXNB9NTTDLKGWWR7ZGE0GMQST69/view.html




http://cdm.unfccc.int/Projects/Validation/DB/H0KUA7IOZUVQCNUEWMFBOU2Z8FIQPD/view.html




http://cdm.unfccc.int/Projects/Validation/DB/8BT6LBKZHD5UJ1UH3P9508VCIIAW6O/view.html




http://cdm.unfccc.int/Projects/Validation/DB/O05FAHI4CXZMS1SOENCSKKFW54ER1D/view.html




http://cdm.unfccc.int/Projects/DB/DNV-CUK1178352647.53/view



http://cdm.unfccc.int/Projects/DB/SGS-UKL1139564002.3/view



http://cdm.unfccc.int/Projects/Validation/DB/FM79CDWNJUJC2WUUFG34AW54KCNCQF/view.html







http://cdm.unfccc.int/Projects/DB/DNV-CUK1179810034.49

http://cdm.unfccc.int/Projects/DB/DNV-CUK1179810034.49




http://cdm.unfccc.int/Projects/DB/TUEV-SUED1166628452.79/view



page 44

Ltd DB/TUEV-

SUED1166628452.79/view

13 Prakash Industries Ltd. 4.50 Janjgir


Validation/DB/PTFHXB0KI1

EXAS38BTUW4HPJ6L4P01/

view.html

14

Rashmi Sponge Iron

Pvt. Ltd. 0.60 Raipur


DB/BVQI1164619036.82/vie

w

15 Real Ispat Pvt. Ltd. 0.60 Raipur


Validation/DB/ORAH7YLLA

X71QE18KRFRK9OTNGUM

LX/view.html

16

Salasar Sponge &

Power Ltd. 0.60 Raigarh


Validation/DB/SQJ4LXE3JQ

G5TVEDJY44C1UGMQKIQ

N/view.html

17

Shree Bajrang Power &

Steel Ltd. 2.10 Raipur


DB/TUEV-

SUED1152883936.57/view

18 Shree Nakoda Ispat Ltd. 0.60 Raipur


DB/TUEV-

SUED1159532983.1/view

19 S.K.S. Ispat Ltd 2.70 Raipur


DB/TUEV-

SUED1159469829.04/view

20

Topworth Steels Pvt.

Ltd. 1.65 Durg


Validation/DB/QYRY7GWNJ

7JO80VX1PRXJA9E01CT96/

view.html

21 Vandana Global Ltd. 2.10 Raipur


DB/SGS-

UKL1147179019.14/view

22 Vaswani Industries Ltd. 0.60 Raipur


Validation/DB/Y6SLS8N7RL

BF17VTRRZAXK8NY5AUN

L/view.html

23 Raipur Alloys & Steel Ltd Raipur


Validation/DB/R9ZPB6H2Q9

HX1UJ9H54WZQ66MVF3Q

Y/view.html

24

Jindal Steel & Power

Limited Raigarh


Validation/DB/MK54J8EY6M

6T8KFGM3PCNQQEQC1D8

8/view.html

25 Nalwa Sponge Iron Limited 1.80 Raigarh http://cdm.unfccc.int/Projects/

http://cdm.unfccc.int/Projects/Validation/DB/PTFHXB0KI1EXAS38BTUW4HPJ6L4P01/view.html




http://cdm.unfccc.int/Projects/DB/BVQI1164619036.82/view



http://cdm.unfccc.int/Projects/Validation/DB/ORAH7YLLAX71QE18KRFRK9OTNGUMLX/view.html




http://cdm.unfccc.int/Projects/Validation/DB/SQJ4LXE3JQG5TVEDJY44C1UGMQKIQN/view.html













http://cdm.unfccc.int/Projects/Validation/DB/QYRY7GWNJ7JO80VX1PRXJA9E01CT96/view.html







http://cdm.unfccc.int/Projects/Validation/DB/Y6SLS8N7RLBF17VTRRZAXK8NY5AUNL/view.html




http://cdm.unfccc.int/Projects/Validation/DB/R9ZPB6H2Q9HX1UJ9H54WZQ66MVF3QY/view.html




http://cdm.unfccc.int/Projects/Validation/DB/MK54J8EY6M6T8KFGM3PCNQQEQC1D88/view.html






page 45

Validation/DB/57M0ZKVMB

ZL6T2YBNJQ9KMGD1IOPC

T/view.html

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