Clean Development Mechanism Project Design Document Form (CDM-PDD) Version 02 - in Effect As Of: 1 July 2004)

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02 CDM Executive Board
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CLEAN DEVELOPMENT MECHANISM PROJECT DESIGN DOCUMENT FORM (CDM-PDD) Version 02 - in effect as of: 1 July 2004) CONTENTS A. B. C. D. E. F. G. General description of project activity Application of a baseline methodology Duration of the project activity / Crediting period Application of a monitoring methodology and plan Estimations of GHG emissions by sources Environmental impacts Stakeholders comments Annexure Annex 1: Contact information on participants in the project activity Annex 2: Information regarding public funding Annex 3: Baseline information Annex 4: Monitoring plan
This template shall not be altered. It shall be completed without modifying/adding headings or logo, format or font.
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SECTION A. General description of project activity A.1 Title of the project activity:
Switching of fuel from Naphtha to Natural gas at United Phosphorus Limited (UPL) Version: 02 Date: 28/03/2006
A.2. Description of the project activity: United Phosphorus Limited (UPL), is the largest producer of crop protection products in India. UPL has one of its manufacturing units in Jhagadia, in the state of Gujarat in India. It runs a state of art, integrated Caustic Chlorine and Value-added Specialty Chemical Complex at Jhagadia. The power requirement of this unit is catered by the captive Power plant situated with in the complex at Jhagadia. The project activity primarily aims at reducing GHG gas emission through switching Naphtha as a fuel to Natural Gas as a fuel for their power plant. While Naphtha was used as a continuous run regular fuel, HSD was the start up fuel. The consumption of Naphtha was around 50,000 Tons/year. The initial financial analysis of the fuel switch project showed unattractiveness due to the huge investments that would go into making this project a reality. But, the extra income derived from the sale of carbon credits was envisaged to pay for the part of the conversion. The project also brings social (employment, health and labor conditions), environmental (air quality) and economic benefits, thus contributing to sustainable development objectives of the government of India. Contribution of the project activity to sustainable development Ministry of Environment and Forests, Govt. of India has stipulated the social well being, economic well being, environmental well being and technological well being as the four indicators for sustainable development in the interim approval guidelines for Clean Development Mechanism (CDM) projects. Social well being By demonstrating feasibility of adoption of a cleaner fuel, by taking recourse to innovative finance mechanism (clean development Mechanism), the project helps diffusion of use of clean fuel in a industrial project
Environmental well being Natural gas use produces less Greenhouse gases into the atmosphere in comparison to Naphtha; Project activity reduces the Greenhouse gases emissions to local and global environment. Reduce GHG emissions per unit of electricity generation;
Economic well being The project activity has resulted in direct and indirect employment generation due to lay down of pipeline for gas transport in the regions;
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Technological well being The project activity involves implementation of a newly built infrastructure using state of the art technology for transmission & distribution of natural gas. The project activity increases the safety of the operations and hazard potentials.
A.3.
Project participants: Private and/or public entity(ies) project participants (*) (as applicable) United Phosphorus Limited (UPL) (Project proponent) Kindly indicate if the Party involved wishes to be considered as project participant (Yes/No) No
Name of Party involved (*) ((host) indicates a host Party) Ministry of Environment and Forest, Government of India; (DNA of Government of India.) (Host)
United Phosphorus Limited will be the sole owner of the CERs generated from the project. The project activity is of unilateral kind. A.4. Technical description of the project activity: A.4.1. Location of the project activity: A.4.1.1. Government of India. A.4.1.2. State of Gujarat in India A.4.1.3. Jhagadia A.4.1.4. Detail of physical location, including information allowing the unique identification of this project activity (maximum one page): The project is located within -Jhagadia industrial estate complex of Gujarat with approximate location 210 20' 45" - N latitude and - 720 34' 19"-E longitude. The site is at a distance of 100 kms from Baroda by road. The nearest airport is Baroda .The nearest railway station is at Ankleshwar, Dist: Bharuch about 20 km away from site. The site is located at 10 kms away south -east of Narmada river. The site location is located at an altitude of 38.25m above MSL Host Party(ies):
Region/State/Province etc.:
City/Town/Community etc:
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A.4.2. Category(ies) of project activity: The project activity is applicable to Scope Number 4, manufacturing Industries, as per the CDM sectoral scope. A.4.3. Technology to be employed by the project activity: UPL has employed a cogeneration technology for power generation. In this technology the fuel is fired in to the gas turbine from where its exits into a combustor. In the combustor there is a mix of air and fuel demand during firing/ignition. Once the engine reaches to its Full Speed No load Stage and warm up cycle is completed, it needs to be synchronised with grid to load the machine or one may choose to run it on a Island Mode i.e isolation from the grid. There after the fuel demand may increase as per the load. The fired fuel generates huge amount of hot gas, which strikes on turbine blades to run the turbine. The turbine shafts being connected to the generator generate power, which gets evacuated through the electrical distribution system. The entire energy of the hot gas generated by natural gas is not utilised in power generation but partly gets exhausted from turbine outlet. With the help of Heat Recovery Steam Generator, the exhaust gas energy is used for steam generation. The steam generated may be categorized into a low-pressure steam or a high-pressure steam. Low pressure is utilised in house or recycled back to conserve water. The high-pressure steam is utilised in two different ways. Firstly it may be sent to steam turbine power generation and secondly may be diverted for process use through pressure reducing cum de-super heating process. UPL uses LM6000 gas turbine based on Natural gas (single fuel system). Prior to this, the turbine had provisions for Liquid fuel ( naphtha as well as diesel ). General Electric is the technology provider.
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The initiatives that lead to fuel switch required UPL to change their equipments right from outside the engine to the final feeding point into the engine i.e. up to the fuel nozzle. Further due to the project activity the following conversions took place 1. Fuel manifold - liquid fuel manifold i.e. two in numbers (primary and secondary) replaced by single gas manifold. 2. Liquid fuel driver i.e. diesel and naphtha driver replaced by gas driver only. 3. Dual fuel nozzles replaced by single fuel nozzles. 4. Piping and Instrumentation Diagram Changes 5. Equipments outside the engine The turbine is an aero derivative gas turbine, first developed for use in aircraft and subsequently utilized for power generation. This turbine is efficient, reliable and light in weight. Such turbine is only at a few places in India and in fact at three locations. These turbines are operating on Naphtha and this project activity is the only fuel shift activity for this class of turbines in India.
A.4.4. Brief explanation of how the anthropogenic emissions of anthropogenic greenhouse gas (GHGs) by sources are to be reduced by the proposed CDM project activity, including why the emission reductions would not occur in the absence of the proposed project activity, taking into account national and/or sectoral policies and circumstances: The proposed CDM project would reduce the emissions of CO2 by replacing more carbon intensive fuels (Naphtha/HSD) by natural gas. Each fuel existing in nature is associated with a carbon emission factor, and such number differs depending on the fuel itself. Natural gas is considered the cleanest fuel of the fossil fuels, as its combustion is associated with low GHG emissions. The shift in the fuel from Naphtha/HSD to Natural Gas at the project site would also lead to reduced emissions caused by the transportation of Naphtha and HSD by road, in addition to those that are due combustion of fuel. There would be additional reduction in emissions, as this mode of transport will no longer be needed. Switching from Naphtha to natural gas would require investment in new equipments. The additional investments imply that project will not be cost effective on its own, in the absence of benefits from GHG emissions reductions. The baseline adopted for the project is based on the assumption that in the absence of benefits from the project being a clean development mechanism project, the company would continue operating its plant with Naphtha, following the trends of the sector as a whole. Thus the project activity is not the baseline and the estimated emission reductions would not occur in the absence of it. Therefore the project shows reduced GHG emission since the CO2 emission from natural gas is lower than from Naphtha and HSD. The estimated total reduction in tonnes of CO2 equivalent over the crediting period of 10 years is 557826 tCO2e.
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A.4.4.1.
Estimated amount of emission reductions over the chosen crediting period:
The estimated emission reductions over the 10 year fixed crediting period would be 557826 tCO2e. Annual estimation of emission reductions Year in tonnes of CO2e Jun 02- Dec 02 33240 Jan 03-Dec 03 54205 Jan 04-Dec 04 56660 Jan 05-Dec 05 55783 Jan 06-Dec 06 55783 Jan 07-Dec 07 55783 Jan 08-Dec 08 55783 Jan 09-Dec 09 55783 Jan 10-Dec 10 55783 Jan 11-Dec 11 55783 Jan 12-May 12 23243 Total estimated reductions (tonnes of CO2e) Total Number of Crediting Years Annual average over the crediting period of estimated reductions (tonnes of CO2e)
557826 10 years 55783
A.4.5. Public funding of the project activity: This CDM project activity has been internally funded. No public funding or ODA has been used on this project activity.
SECTION B. Application of a baseline methodology B.1. Title and reference of the approved baseline methodology applied to the project activity: Title: Baseline methodology applied to UPL is AM0008 named Industrial fuel switching from coal and petroleum fuels to natural gas without extension of capacity and lifetime of the facility Reference: AM0008
B.1.1. Justification of the choice of the methodology and why it is applicable to the project activity: As per the methodology document, the methodology is applicable to a project activity, which is to switch the industrial fuel currently used in some element process of a facility to a natural gas from coal, and /or petroleum fuels that would otherwise continue to be used during the crediting period.
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The conditions under which the methodology would be applicable are delineated: The local regulations/programs do not constrain the facility from using coal/petroleum fuels; Use of coal and/or petroleum fuels is less expensive than natural gas per unit of energy in the country and sector; The facility would not have major efficiency improvements during the crediting period; The project activity does not increase the capacity of final outputs and lifetime of the existing facility during the crediting period (i.e., this methodology is applicable by the end of the lifetime of existing facility if shorter than crediting period), and The proposed project activity is defined as fuel switching applied to element processes and does not result in integrated process change, except for possible associated changes in other energy use (such as electricity for coal processing) outside the affected element processes, which shall (could) be treated as leakage.
The present project activity is a switch from Naphtha to Natural gas to generate power, the capacity of generation remaining the same. The use of Natural gas would replace Naphtha resulting in lower emissions. The present project activity is eligible to use the approved methodology AM0008 for Industrial fuel switching from coal and petroleum fuels to natural gas without extension of capacity and lifetime of the facility since the following conditions in the project activity fulfil all the applicability conditions as in AM 0008 : The local regulations/programs in the state of Gujarat or in India do not constrain the facility from using Naphtha Since India has no regulation, which requires a manufacturing unit to switch the industrial fuel currently being used to natural gas from Coal and/ or petroleum fuel. The Indian Electricity Act of 2003 does not restrict or empower any authority to the fuel choice for power generation. There are no environmental regulations in India and Gujarat state preventing the use of naphtha/petroleum fuel/ coal or promoting the use of natural gas for power generation.1 The use of coal as a fuel is less expensive than the natural gas per unit of energy generation in India. India has some of the largest reserves of coal in the world (As per the latest estimate of Geological Survey of India (GSI), coal resources in the country are 211.59 billion tonnes, upto the depth of 1200 metres.) in the world. Lignite reserves in the country are approximately 27.45 billion tonnes.2 Coal is the dominant energy source in India, accounting for more than half of the country's requirements. 70% of India's coal production is used for power generation, with the remainder being used by heavy industry and public use.3 The State of Gujarat where the plant is located is rich in lignite deposits. The plant based on lignite as feedstock have been put up by Gujarat Industries Power Company Limited (GIPCL )(Surat Lignite TPP (Unit -1 & 2)(date of addition :16/01/00,06/11/99)4 (250 MW) and by Gujarat company Gujarat
1 2 3 4
www.powermin.nic.in/acts_notification/ electricity_act2003/preliminary.htm - 41k http://pib.nic.in/archieve/factsheet/fs2000/coal.html http://www.mbendi.co.za/indy/ming/coal/as/in/p0005.htm CEA General Review 1999-00
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Mineral Development Corporation (GMDC) (125 MW Akrimota TPS )5. Both GMDC and GIPCL are further planning new plants based on lignite. Generating Stations in Gujarat receive coal from far off places in the eastern part of the Country. To mitigate the impact of the transportation cost, Gujarat Electricity Board (GEB) has secured linkages of coal from the Western Coal fields (WCL). The cost of generation of power has also got reduced by way of purchase of beneficiated coal and the washed coal. However, new capacity added is on lignite not coal as due to development of lignite mines in the state of Gujarat. M/s. GIPCL is also engaged in generation of power by exploiting lignite deposits in Gujarat. The break-up of the net addition is as under: 2 x 125 MW Pit Head Lignite Based Power Project at Akrimota in Kachchh district through GMDC. 3 x 125 MW Pit Head Lignite Based Power Project at Ghogha in Bhavnagar district through (Reliance Industries Limited) RIL 615 MW Dual Fuel Based Power Project at Kovaya in Amreli district through KRIBHCO. The above data indicates that addition in capacity in the State based on lignite is increasing. Gas used in the state of Gujarat is increasing but simultaneously other fuel used is also increasing. Generation cost of power with coal and or lignite is lower as compared with use of Natural Gas as per details given below for Power Plants of Gujarat. The cost of coal in Gujarat is Rs 2193 per MT for D Grade coal of Useful Heat Value of 4608 Kcal / Kg. The cost of energy is working out 2101 Kcal / Rs and fuel cost of power as Rs 1.14 per unit ( Heat Rate 2400 Kcal / kwh ). Generation cost (Rs./kwh) based GSECL Gandhinagar Unit 5 on coal Plant 2000-01 2001-02 1.33 1.33 GSECL Wanakbori Unit 7
1.33 1.35
Source: Case No. 252/ 2003, Before the Gujarat Electricity Regulatory Commission at Ahmedabad At the time of signing of contract with Gujarat Gas, the company analyzed historical purchase data of Naphtha procurement cost (procured from Reliance Petroleum Ltd and Indian Oil Corporation Ltd) and it was observed that the operation of Power Plant on Naphtha is slightly cheaper as compared to Natural Gas from Gujarat Gas. The average landed cost of Naphtha from the plant data is calculated as Rs.9779/- MT at UPL Plant. 6. The feedback available to the company and Gas
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www.gujaratindia.com/Useful-Info/ Socio%20Economic%20Review/ser03/serp2-5.pdf Reliance Petroleum Ltd and Indian Oil Corporation Ltd Invoice
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Purchase Agreement from Gujarat Gas7 shows that the gas price will be approx. US$ 3.773 / 1000 SCF at 8350 Kcal / SM3 calorific value, and the landed cost after adding for transportation and tax etc. would be approximately Rs.5.07 USD per mmbtu. Based on the above information, the generation costs with each fuel as assessed at the time of Gas contract agreement is as mentioned below. Price for naphtha will be (9779*0.252*1000000)/(10580*1000) = Rs 232.92 per mmbtu Price for NG - Supply (3.773*0.03531*0.252*1000000)/8350 = 4.02 USD - Tax 0.01 USD - Transport (1.70*1000000*0.252)/(8350*49.05) = 1.05 USD - Total 5.08 USD per mmbtu = 5.07*49 = Rs 249 per mmbtu Fuel cost on naphtha = (1900*232.92)/1000000*0.252) = Rs 1.756 per unit Fuel cost on NG = (1900*249)/(1000000*0.252) = Rs 1.88 per unit (Annex X:Naphtha NCV), (Annex XI: Exchange rate 1 USD=INR 49.05) Thus cost of fuel per energy at the time of signing of contract, i.e. in 2001 was the lowest for Coal / Lignite, followed by Naphtha and highest on Natural Gas.
The facility would not have major efficiency improvements during the crediting period;
The project activity is a fuel switch project. There is minor efficiency difference between Naphtha and natural gas combustion, as in the case of fuel switch for combustion. This difference cannot be considered as a major efficiency improvement. Due to the switch to Natural gas, there is no increase in the capacity of the final output at United Phosphorous Limited and lifetime of the existing facility during the crediting period The capacity of LM 6000 gas turbine does not vary with change of fuel (naphtha to natural gas) The rated capacity before fuel switch was 41.80 MW and even after switch also it remains same (Source: General Electric catalogue). The project activity involved modification of existing equipments therefore there is no increase in the capacity of the final output. The Switch from Naphtha to Natural gas does not result in any kind of the process change. This project activity has not resulted in any process change. B.2. Description of how the methodology is applied in the context of the project activity:
The basic assumption of the baseline methodology is that in the absence of the project activities Naphtha and HSD would have otherwise been continued to be used in the existing facility at least up to the end of the crediting period without any retrofit, which extends its capacity or lifetime, or improve its fuel efficiency. The methodology as proposed by AM0008 has been applied to this project activity. As per the methodology the parameters (variable) Q_Fi,y in the baseline emissions formula are calculated as specified in the project scenario section by using parameters monitored ex ante or ex post.
15th October 2001, Gas Purchase Agreement between Gujurat Gas Company Limited and Search Chem Industries Limited
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Quantity of fuel used in the baseline scenario in the baseline emissions of this project activity, is calculated expost from the quantum of Natural gas used (keeping the efficiency rate constant in the case of Naphtha and Natural Gas being used for Power Generation) The approved methodology AM0008 is used to calculate the baseline emission from Naphtha and HSD consumption data during the period of October 1998 to September 2001and Natural Gas consumption during the project activity scenario. Methane and Nitrous Oxide produced in the combustion are estimated using the International Panel on Climate Change (IPCC) standard emission factors for each fuel. The total CO2e emissions associated with Naphtha and HSD is calculated by the same Naphtha and HSD consumption estimates from the Natural gas consumption during the project activity period. The methodology is used to calculate the CO2 emissions from the project activity by estimating the consumption of Natural Gas and its (Net Calorific Value) NCV value. It also takes into account the overall CH4 and N2O emissions from the project activity. The Baseline CO2 and project activity CO2 emissions are made up of carbon dioxide emissions from combustion, methane and nitrous oxide emission from combustion, and fugitive methane emissions associated with Natural gas production, transport and distribution. The emission reduction is calculated by subtracting the project activity emissions and leakages from the baseline emission. Carbon dioxide emissions are determined from standard IPCC emissions factors . Methane and nitrous oxide produced in the combustion are estimated using IPCC standard emission factors for each fuel. Fugitive emissions from natural gas production and transportation and distribution are also obtained from region specific emissions factors given by IPCC. Total Methane emissions from combustion and fugitive emissions, are converted to equivalent CO2 emission using the (Global Warming Potential) GWP of 21 as agreed on the First commitment period of Kyoto Protocol. Similarly, nitrous oxide emissions are converted to equivalent CO2 emissions using the GWP of 310 as agreed on the First commitment period of Kyoto Protocol. In order to calculate the baseline emissions, the following steps have been adopted: Step 1. As per the methodology the parameters (variable) Q_Fi,y in the baseline emissions formula are calculated as specified in the project scenario section by using parameters monitored ex ante or ex post. Quantity of fuel used in the baseline scenario in the baseline emissions of this project activity, is calculated expost from the quantum of Natural gas used. Step 2. The emission factors for CO2, CH4 and N2O (that could be emitted from burning of fuels in the baseline scenario) has been calculated. Step 3. The total equivalent t CO2 emission is calculated.
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The baseline CO2, CH4 and N2O have been calculated by using IPCC factors. The leakages have been estimated due to production of fuel using IPCC factor. The additionality has been established as given in B.3. below.
Variable Q_NGy = quantity of natural gas used (Joules) ._NG = fuel efficiency of natural gas Q_F1,y= quantity of HSD used mass unit of HSD consumed Q_F2,y = mass unit of Naphtha consumed _HSD & Na Parameter EFNG =Carbon emissions factor per unit of energy of the Natural Gas EFHSD =Carbon emissions factor per unit of energy of the HSD EFNa =Carbon emissions factor per unit of energy of the Naphtha OXIDNG =Oxidation factor of the fuel Natural Gas (%) OXIDHSD =Oxidation factor of the fuel HSD (%) OXIDNa =Oxidation factor of the fuel Naphtha (%)
Data Source Power plant record, Natural Gas Supplier records Calculated from monitored variable Power plant record, Supplier records Power plant record, Supplier records Calculated from monitored variable Data Source Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-2 Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-2 Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-2 Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-4 Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-4 Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-4
B.3. 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: The approved methodologys additionality assessment relates to the following The local regulations/programs do not constrain the facility from using coal/petroleum fuels; Use of coal and/or petroleum fuels is less expensive than natural gas per unit of energy in the country and sector Since India has no regulation, which requires a manufacturing unit to switch the industrial fuel currently being used to natural gas from Coal and/ or petroleum fuel, it can be clearly demonstrated that UPL is not constrained by the local regulations from using coal/petroleum fuels and hence switch to Natural gas is additional. Further to this, use of coal is less expensive than natural gas per unit of energy generation in the country and sector. In the absence of project activity, naphtha would have continued to be used as fuel for generation of electricity at the power plant. Since, naphtha is more Greenhouse Gas (GHG) intensive than natural gas, by switching over to the new fuel, emission reductions has occurred.
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This project activity will be defined as additional8 if anthropogenic emissions of GHGs by sources are reduced below those that would have occurred in the absence of the registered Clean Development Mechanism (CDM) project activity. Within the scope of the adopted new baseline methodology, additionality has been demonstrated using the following points: Additionality relates to the first and the second applicability conditions of the method. To assess the first condition, the project participants shall demonstrate that there are no local regulations/programmes constraining the use of coal/petroleum fuels. The methodology requires that trends in coal and natural gas consumption in the country/region and sector shall be analyzed and reported. The economic investment analysis shall use net present value (NPV) analysis. The project is additional if the NPV of the project activity is negative. Additionality relates to the first and the second applicability conditions of the method. Since India has no regulation, which requires a manufacturing unit to switch the industrial fuel currently being used to natural gas from Coal and/ or petroleum fuel. The Indian Electricity Act of 2003 does not restrict or empower any authority to the fuel choice for power generation. There are no environmental regulations in India and Gujarat state preventing the use of naphtha/petroleum fuel/ coal or promoting the use of natural gas for power generation. It can be clearly demonstrated that UPL is not constrained by the local regulations from using coal/petroleum fuels and hence switch to Natural gas is additional. The additionality relates to the second applicability conditions have been described in section B1.1. The availability of Natural Gas in the country is lower than the demand in the country and same is the scenario in the State of Gujarat. The demand of Gas in the State of Gujarat is higher due to various industrialization steps taken by the State Government. Though numbers of steps have been taken for increasing the supplies of Gas but the demand has increased by manifolds. Some of the Power Plants in the State are still lying idle in spite of development of new fields like GSPC at Hazira, setting-up of RLNG Terminal at Dahej. There is a recent article on the availability of Natural Gas, which explains that the Natural Gas availability in Gujarat is not there9. The article quotes Mr. R.V. Shahi, Secretary of Power, Government of India that there is no availability in both domestically as well as imported in the form of (Liquefied Natural Gas) LNG and Power Plants in Gujarat like (National Thermal Power Corporation) NTPC, Kawas and Gandhar, Torrent Power will have to starve for Natural Gas. It further, says that 2000 MW power capacity at an investment of Rs.8000 crores may have to go slow. The fuel consumption figure for Gujarat state for different fuels in the power generation from the year 2000 to 2004 are as follows: Fuel Coal Lignite Naphtha Natural Gas
8
Units 000' MT 000' MT Kilo Ltrs M. Cu.Mts.
2003-2004 15856 2560 405808 1574
2002-2003 19298 1931 426280 851
2001-2002 16722 1107 139937 538
2000-2001 15940 1144 469945 847
As per 17/cp.7 Gas , coal shortage fuels power shock in The Economic Times, Mumbai Edition dated 2nd December 2005
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Source: Table number 6.1, General Review 2000-2001, 2001-2002, 2002-2003, 2003-2004; Central Electricity Authority
Consumption of Coal, Lignite, Naphtha, Natural Gas for Electricty Generation in Gujurat
25000
20000
15000 Coal 000' MT Lignite 000' MT Naphtha 000' Kilo Ltrs Natural Gas M. Cu.Mts. 10000 Quantity 5000
0 2003-2004 2002-2003 Year 2001-2002 2000-2001
The economic investment analysis use net present value (NPV) analysis. The project is additional if the NPV of the project activity is negative.
Investment requirements for fuel switching; Converting from Naphtha to Natural gas required UPL huge investments in new equipments as well as infrastructure that would enable the shipping of the fuel at the plant site, installing meters and regulators etc. The total investment for the project activity is valued at INR 187.4 million. It includes cost of conversion, hardware, LC and other charges, installation, transportation cost. A discount rate appropriate to the country and sector; A discount rate appropriate to the country and sector has been considered to be 10%. However different NPV analysis was done with a range of discount rate (10%-15%) to evaluate its outcome. Efficiency of each fuel using equipment, with the baseline fuel and with natural gas;
The project activity is a fuel switch project. There is minor efficiency difference between Naphtha and natural gas combustion, as in the case of fuel switch for combustion. This difference cannot be considered as a major efficiency improvement. Current price and projected price (variable costs) of each fuel;
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At the time of signing of contract with Gujarat Gas, the company analyzed 36 months purchase data of Naphtha procurement cost (procured from IOC and RIL) and it was observed that the operation of Power Plant on Naphtha is slightly cheaper as compared to Natural Gas from Gujarat Gas. The average cost of Naphtha for the period Jan 1998 to Jan 2001 is Rs.9779/- PMT landed at UPL Plant. (Plant source and IOL and RIL invoice) The feedback available to the company and Gas Purchase Agreement from Gujarat Gas shows that the gas price will be approx. US$ 3.773 / 1000 SCF at 8350 Kcal / SM3 calorific value, and the landed cost after adding for transportation and tax etc. would be approximately Rs.5.08 USD per mmbtu. Based on the above information, the generation costs with each fuel as assessed at the time of Gas contract agreement is as mentioned below Price for naphtha will be (9779*0.252*1000000)/(10580*1000) = Rs 232.92 per mmbtu Price for NG - Supply (3.773*0.03531*0.252*1000000)/8350 = 4.02 USD - Tax 0.01 USD - Transport (1.70*1000000*0.252)/(8350*49.05) = 1.05 USD - Total 5.08 USD per mmbtu = 5.07*49 = Rs 249 per mmbtu Fuel cost on naphtha = (1900*232.92)/1000000*0.252) = Rs 1.756 per unit Fuel cost on NG = (1900*249)/(1000000*0.252) = Rs 1.88 per unit Price of fuel: The price of the fuel is based on global rather than a regional framework, given the global interdependence of energy markets. Price stability or volatility of the fuels will be felt by global market simultaneously. Considering the market variability about the petroleum products the trend for both the product was assumed to be same. Therefore, we have taken a constant price for the product during the life time of the project activity. The price of fuel during the inception of the project activity was Naphtha INR 232.92 per mmbtu, Natural Gas 249 per mmbtu. Difference in operating costs for each fuel (especially, handling/treatment costs for coal); There will be no major change in operating cost because naphtha is delivered by tankers and this cost has been already included in the cost of naphtha. Natural Gas is billed at the delivery point. Lifetime of the project, equal to the remaining lifetime of the existing equipment(s); and 15 years
Equipment replacement costs if any during the project lifetime. In case of natural gas hot section has to be replaced after 25000 hours and in case of naphtha hot section has to be replaced after 12500 hours. However, as a conservative approach we have not considered the replacement cost difference in the NPV calculations. (Source:plant) The financial analysis conducted at the time of the project development and implementation, in 2002, showed the economic infeasibility of the initiative. Converting from Naphtha to Natural gas required UPL huge investments in new equipments as well as infrastructure that would enable the shipping of the fuel at the plant site, installing meters and regulators etc. The additional investments and anticipated business discontinuity losses for switch over to natural gas implied that the project would not be cost effective. NPV is calculated considering the investment and operational expenses including the cost of opportunity losses that UPL incurred during the fuel switch activity. It is important to understand the figures were estimated considering projections carried out by UPL at the time the project was being considered. Analysis carried out to assess the attractiveness and the feasibility also includes the residual value of the new equipment, as required by the methodology. The analysis shows it was not an attractive investment. Without the expectation of this project being a CDM, the investment would not have happened. Credits from GHG emission reductions were envisaged to reduce the deficit.
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The net present value of the investment into the project activity is estimated as negative. Alternative 1: Including the cost of opportunity losses that incurred during the shut down period of the plant Discount rate NPV (without CER) 10% (951.76) 11% (939.95) 12% (929.14) 13% (919.23) 14% (910.12) 15% (901.74)
NPV (with (828.64) CER)
(823.55)
(818.90)
(814.63)
(810.70)
(807.09)
Alternative 2: Excluding the cost of opportunity losses that incurred during the shut down period of the plant Discount rate NPV (without CER) 10% (403.74) 11% (391.93) 12% (381.12) 13% (371.21) 14% (362.11) 15% (353.72)
NPV (with (280.63) CER)
(275.54)
(270.88)
(266.61)
(262.68)
(259.07)
NPV analysis with both the alternative scenarios has given a negative NPV results. However, the revenue has substantially increased with CERs revenue. The investment cost and revenue loss towards the fuel switch are offset in part by revenue earning from carbon credits that expand revenue earning that helps to offset an investment barrier to project implementation. The emission reductions are going to be achieved through the use of cleaner fuel, natural gas, instead of one whose combustion is associated with higher emission factors, as put before. And since the equipments in use lead to nearly the same efficiency in fuel use for energy generation, natural gas greenhouse gas emissions are lower than those accoutring when naphtha is used. As such a fuel shift would not have occurred during normal business course, the project activity reduces emissions below those that would have occurred in the absence of registered CDM project activity. B.4. Description of how the definition of the project boundary related to the baseline methodology selected is applied to the project activity: For the purpose of this analysis, the project boundary encompasses the physical, geographical site of the plant. Schematically the figure shows the project boundary, indicating energy flows into the boundary and fugitive methane emissions associated with natural gas.
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Figure
Natural Gas
Co2 emissions from the transport of Naphtha
Naptha. HSD
Boilers that are part of process cycle generating Power
Fugitive methane emission from natural gas production ,pipeline and distribution leakage Emissions of Co2, CH4 and N2O from fuel combustion
B.5. Details of baseline information, including the date of completion of the baseline study and the name of person (s)/entity (ies) determining the baseline: The draft PDD with baseline study was completed on 01/10/2005. Baseline is calculated as mentioned under section E: Date of completing the final draft of this baseline section (DD/MM/YYYY): 28/03/2006 Name of person/entity determining the baseline: PricewaterhouseCoopers (P) Limited has assisted the project proponent in determining the application of baseline methodology for the identified CDM project. Organization: PricewaterhouseCoopers (P) Ltd. Street/P.O.Box: 252, Veer Savarkar Marg,Shivaji Park, (Opp. Shivaji Park Maidan,Next to Mayor's Bungalow) Building: 3rd Floor, A Wing City: Dadar (W), Mumbai State/Region: Maharastra Postcode/ZIP: 400 028. Country: India Telephone: + 9122 5669 1500 (Board), + 9122 5669 1302 (Direct) FAX: + 9122 5654 7804 / 05 E-Mail: URL: .. Represented by: Title: Associate Director Salutation: Mr. Last Name: Ram Babu Middle Name: First Name: P Department: Sustainable Business Solutions Mobile: +91-9820135929
page 18
Direct FAX: Direct tel: Personal E-Mail:
+91-22-24913417 +91-22-56619341 ...
PWC is not a project participant as meant in Annex I.
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: The commercial operation had commenced on 01/06/2002, which is taken to be the starting date of the Project Activity. C.1.2. Expected operational lifetime of the project activity: The project activity is expected to be operational for a period 15 years from the date of commencement of operations. C.2 Choice of the crediting period and related information:
Fixed Crediting Period C.2.1. Renewable crediting period C.2.1.1. N/A C.2.1.2. N/A C.2.2. Fixed crediting period: 10 years C.2.2.1. 01/06/2002 C.2.2.2. 10 Years 0 months Length: Starting date: Length of the first crediting period: Starting date of the first crediting period:
page 19
SECTION D. Application of a monitoring methodology and plan D.1. Name and reference of approved monitoring methodology applied to the project activity:
The approved monitoring methodologyAM0008 Industrial fuel switching from coal or petroleum fuels to natural gas without extension of capacity and lifetime of facility has been adopted in line with the adopted baseline methodology. D.2. Justification of the choice of the methodology and why it is applicable to the project activity: The applicability criteria of monitoring methodology AM0008 is the same as that for baseline ethodology AM0008. Since, the baseline methodology is applicable to the project activity the monitoring methodology will also be applicable. The monitoring methodology involves monitoring of the followings: The GHG emission factors are those per unit of caloric value (e.g., Joule, kcal, etc.) times caloric content per physical unit (e.g., ton, liter, m3, etc.) with suitable oxidization factors specified in the IPCC Guidelines. Local statistical data are preferable to some aggregated (mean) default values; For each element process power production, the fuel efficiency is measured ex-ante before switching to natural gas as a function of load factor. On the other hand, efficiency of NG (also a function of load factor) is measured at an early stage after implementation of the project. By using the measured quantity Q_NGy * efficiency of NG/Efficiency of Naphtha&HSD, the baseline fuel consumption of the element process Q_Fi,y is calculated. Q_Fi,y is calculated as the sum of Q_Fi,y in the project process and operation pattern. Q_NGy is also independently measured Applicability concerning the local regulations are checked (i.e., listed as monitoring items); a) The price differential between coal and gas in the host country. Prices are monitored, so that changes in price differentials can be seen. b) Share of imported versus domestic coal, and the actual emission factor characteristic of coal and gas consumed in the host country. For non-CO2 GHG emissions part associated with fuel combustion and fugitive emissions , IPCC default parameters can be used for the emission factors because such parts are minor; For CO2 emission part associated with transportation of natural gas, Naphtha and HSD, Q_TEi,y are directly monitored for project scenario and calculated with suitable assumptions for baseline scenario. The emission factors are those of the IPCC default value.
page 20
D.2. 1. Option 1: Monitoring of the emissions in the project scenario and the baseline scenario D.2.1.1. Data to be collected in order to monitor emissions from the project activity, and how this data will be archived:
ID number (Please use numbers to ease crossreferencing to D.3) 1.Q_NGy Data variable Source of data Data unit Measured (m), calculated (c) or estimated (e) m Recording frequency Proportion of data to be monitored How will the data be archived? (electronic/ paper) Electronic
For how long is archived data kept?
Comment
Quantity of natural gas used
Apex Control System, Power plant records
TJ
Continuous / Monthly
100%
Project Lifetime
Converted from the physical quantity (m3), using heating value for natural gas . Confirmed by natural gas purchase record
D.2.1.2. Description of formulae used to estimate project emissions (for each gas, source, formulae/algorithm, emissions units of CO2 equ.) Project emissions are estimated considering the different fuels and efficiencies in their use in both the baseline and project scenario. According to AM0008, the following formulae are used to estimate project emissions: PEy= (iQi_NGy)*(EF_NG + FC_NG_CH4* GWP_CH4 + FC_NG_N2O* GWP_N2O) Where: Qi_NGy = Are quantity of natural gas used in project scenario for replacing Q_Fi,y quantity of fuel i used in the baseline scenario, measured in energy units (e.g Joule or Kcal) Q_NGy = (iQi_NGy) = Are the total quantity of natural gas in the project scenario for replacing all quantity of fuel I used in some element process in the baseline scenario EF_NG = Are the IPCC default CH4 emission factor of natural gas associated with fuel combustion (e.g. t CO2/TJ)
page 21
FC_NG_CH4 = Are IPCC default Ch4 emission factor of natural gas associated with fuel combustion, measured in t CH4/TJ FC_NG_N2O = Are IPCC default N2O emission factor of natural gas associated with fuel combustion, measured in t CH4/TJ
D.2.1.3. Relevant data necessary for determining the baseline of anthropogenic emissions by sources of GHGs within the project boundary and how such data will be collected and archived :
ID number (Please use numbers to ease crossreferencing to D.3) 2. Q_F1,y 3.Q_F2,y Data variable Source of data Data unit Measured (m), calculated (c) or estimated (e) C C Recording frequency Proportion of data to be monitored How will the data be archived? (electronic/ paper) Electronic Electronic Electronic /paper
Comment
4._NG
5._HSD & Na
Quantity of HSD used Quantity of Naphtha used Fuel Efficiency of natural gas used at process Fuel Efficiency of Naphtha and HSD Load factor at the power plant Local regulation or
Power plant records Power plant records
TJ
Monthly Monthly Once at the early stage of the project Once before fuel switch to Natural gas -At the renewal of crediting
100% 100% 100%
Project lifetime Project lifetime Project lifetime
TJ
Calculated as n,operation pattern Qn_F1,,y Calculated as n,operation pattern Qn_F2,y
Calculated from monitored variable Calculated from monitored variable

Power plant records Legal documents or laws
The calculation is based on historical consumption
100%
Electronic /paper
Project lifetime
The calculation is based on historical consumption.
6. L_Factorn 7.L_Regy
M checked
100% 100%
Electronic /paper Electronic/ paper
--
Project lifetime
To be checked in the starting of the crediting
page 22
D.2.1.3. Relevant data necessary for determining the baseline of anthropogenic emissions by sources of GHGs within the project boundary and how such data will be collected and archived :
ID number (Please use numbers to ease crossreferencing to D.3) Data variable Source of data Data unit Measured (m), calculated (c) or estimated (e) Recording frequency Proportion of data to be monitored How will the data be archived? (electronic/ paper)
Comment
constraints in using naptha and other petroleum fuel
period
period as there is no renewal
D.2.1.4. Description of formulae used to estimate baseline emissions (for each gas, source, formulae/algorithm, emissions units of CO2 equ.) The variables in the baseline emissions (Q_Fi,y) and the project emissions (Q_NGy) are linked with the constraint relation: (Q_F1,y+ Q_F2,y) * _HSD & Na = Q_NGy * _NG Similar to what is going to be carried out for project emissions estimate, the baseline methodology presents the following rationale for estimating the baseline BEy= iQ _ Fi,y*(EF_ Fi _CO2y+ FC_Fi_CH4* GWP_CH4 + FC_Fi_N2O* GWP_N2O) Where: i : 1=HSD,2=Na Q_Fiy Are quantity of Naptha used in Baseline scenario, measured in energy units (e.g. Joule) EF_ Fi are CO2 equivalent emission factor per unit of energy of fuel i (e.g. t CO2/TJ)
page 23
EF_NG are the IPCC default CH4 emission factor of natural gas associated with fuel combustion (e.g. t CO2/TJ) FC_Fi_CH4 are IPCC default CH4 emission factor of Fuel i associated with fuel combustion, measured in t CH4/TJ FC_Fi_N2O are IPCC default N2O emission factor of natural gas associated with fuel combustion, measured in t CH4/TJ GWP_CH4 is the global warming potential set as 21 for the first commitment year GWP_N2O is the global warming potential set as 310 for the first commitment year
D. 2.2. Option 2: Direct monitoring of emission reductions from the project activity (values should be consistent with those in section E). Not opted for. D.2.2.1. Data to be collected in order to monitor emissions from the project activity, and how this data will be archived:
ID number (Please use numbers to ease crossreferencing to table D.3) Data variable Source of data Data unit Measured (m), calculated (c), estimated (e), Recording Frequency Proportion of data to be monitored How will the data be archived? (electronic/ paper) Comment
NA D.2.2.2. Description of formulae used to calculate project emissions (for each gas, source, formulae/algorithm, emissions units of CO2 equ.): Not applicable.
page 24
D.2.3. Treatment of leakage in the monitoring plan D.2.3.1. If applicable, please describe the data and information that will be collected in order to monitor leakage effects of the project activity
ID number (Please use numbers to ease crossreferencin g to table D.3) Data variable Source of data Data unit Measured (m), calculated (c) or estimated (e) Recording Frequency Proportion of data to be monitored How will the data be archived? (electronic/ paper) Comment
In the case of this project activity, project-monitoring data is the only information to be collected in order to monitor leakage effects of the project activity. Considering this will be measured in accordance with tables D.2.1.1 and D.2.1.3 (baseline scenario, there is no need to repeat them here.
D.2.3.2. Description of formulae used to estimate leakage (for each gas, source, formulae/algorithm, emissions units of CO2 equ.) LEy= [Q_NGy * FE_NG_CH4 - i(Q _ Fi,y * FE_Fi_CH4) ] * GWP _CH4 FE_NG_CH4 are IPCC default CH4 emission factor of Natural gas associated with methane fugitive emissions, measured in t CH4/TJ FE_Fi_CH4 are IPCC default CH4 emission factor of Naphtha associated with methane fugitive emissions, measured in t CH4/TJ FE_NG_CH4 = 118 kgCH4/TJ = 0.118 tCH4/TJ, as presented in the Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories Volume 3 Reference Manual, Section 1.8.5, Table 1-58, Natural gas processing, transport and distribution. FE_FO_CH4 = 0. Fugitive emissions of CH4 associated with fuel oil production and transportation will be considered zero. The reason is the lack of specific CH4 emission factors for the production of Naphtha &HSD fuel oil. This is conservative. EF_TF_NG and EF_TF_FO are CO2 emission factors for the transportation of Natural gas and HSD and Naphtha.
page 25
EF_TF_NG = 0. Natural gas is transported through pipelines; hence no emissions of CO2 are attributed due to its transportation. Fugitive emissions of CH4 are considered in FE_NG_CH4. EF_TF_FO = 0. Fuel oil would be transported through trucks in the baseline and emissions of CO2 would occur due to fossil fuel consumption. However, these emissions will not be considered. This is conservative. LE= Q_ NG Q*0.118*21 =2.48*Q_NG [tCO2] D.2.4. Description of formulae used to estimate emission reductions for the project activity (for each gas, source, formulae/algorithm, emissions units of CO2 equ.) Emission reductions for the project activity are determined considering baseline emissions minus project emissions minus leakage. In that regards, emission reductions can be determined as Er = BEy PEy- LEy The variables in the baseline emissions (QE_LFy) and the project emissions (QE_GFy) are linked with the energy efficiency constraint relation: QE_LFy * LFy = QE_GFy * GFy Here LFy and GFy are fuel efficiencies for use of liquid and gaseous fuels, respectively, and ensures a check that during any year y the energy efficiencies are not changed due to use of the new fuel.
D.3.
Quality control (QC) and quality assurance (QA) procedures are being undertaken for data monitored
Uncertainty level of data (High/Medium/Low) Low Low Explain QA/QC procedures planned for these data, or why such procedures are not necessary.
Data (Indicate table and ID number e.g. 3.-1.; 3.2.) 1-6 7
These data will be directly used for calculation of emission reductions. The measurements and data recording will be as per the procedures under ISO 9002 certified Quality Management System of the Unit.. This is to check that the applicability condition is met. Information will be confirmed with the latest regulations of Government of India and state govt of Gujurat
page 26
D.4 Please describe the operational and management structure that the project operator will implement in order to monitor emission reductions and any leakage effects, generated by the project activity The project will be operated and managed by UPL who is also the project proponent. . The site also has an ISO 9000 Quality Management system in place. Accordingly, the monitoring plan proposed herein will become an integral part of the project Management Programmes and would be constituent of operational and management structure of this Quality Management System (QMS). In order to monitor and control boilers performance, UPL has placed a project management team. They are co-ordinatored by a single project manager who is responsible for checking the information consistency. These operators are responsible for managing the computer system, which are utilised to collect data, which is read, from the gas meters. measurements are carried out electronically. Measuring steam pressure continuously, according to the process demands. These
The Instrumentation and the control system for the project activity are designed with adequate instruments to control and monitoring the various operating parameters for safe and efficient operations. All the instruments are of reputed make and are calibrated at regular intervals.
Designation Project Head:
Responsibilities Registration
Project Executer and Controller: Project Execution and Operation Site Main Controller Controller : Maintenance Engineer Monitoring & Verification of data (once in a week), Operation Monitoring & Verification of data (once in a day), Operation, Power generation Mechanical Maintenance, Energy Input meter monitoring & Maintenance , Energy output meters Monitoring of data collection (once in every day), Operation, Power generation, Data
Operation Engineer (one in a shift)
page 27
collection ,Checking data accuracy ,Data recording
D.5
Name of person/entity determining the monitoring methodology:
The draft PDD monitoring section study was completed on 01/10/2005. The final draft of this monitoring section was completed on (DD/MM/YYYY): 28/03/2006 PricewaterhouseCoopers (P) Limited has assisted the project proponent in determining the monitoring methodology and plan.
page 28
SECTION E. Estimation of GHG emissions by sources E.1. Estimate of GHG emissions by sources: PEy= (iQi_NGy)*(EF_NG + FC_NG+FC_NG_CH4* GWP_CH4 + FC_NG_N2O* GWP_N2O) The GHG emissions (CO2) due to the project activity will result from burning of Natural gas. The annual project emission is given below in tCO2. Year Jun 02- Dec 02 Jan 03-Dec 03 Jan 04-Dec 04 Jan 05-Dec 05 Jan 06-Dec 06 Jan 07-Dec 07 Jan 08-Dec 08 Jan 09-Dec 09 Jan 10-Dec 10 Jan 11-Dec 11 Jan 12-May 12 Project Emissions (PEy) 81866 133500 139548 137386 137386 137386 137386 137386 137386 137386 57244
For the year 2002 the calculation is based on the data from June- December. For the year 2012 the calculation is based on data from the month of January May. For other year the Calculation is based on January December. This is applicable to all the emission calculations. E.2.
Estimated leakage:
Year Jun 02- Dec 02 Jan 03-Dec 03 Jan 04-Dec 04 Jan 05-Dec 05 Jan 06-Dec 06 Jan 07-Dec 07 Jan 08-Dec 08 Jan 09-Dec 09 Jan 10-Dec 10 Jan 11-Dec 11 Jan 12-May 12 Leakage (LEy) 3634 5926 6194 6098 6098 6098 6098 6098 6098 6098 2541
E.3.
The sum of E.1 and E.2 representing the project activity emissions:
page 29
The total project emissions during Total Project Emissions (PE y+LEy) t CO2 85500 139425 145742 143484 143484 143484 143484 143484 143484 143484 59785
Year Jun 02- Dec 02 Jan 03-Dec 03 Jan 04-Dec 04 Jan 05-Dec 05 Jan 06-Dec 06 Jan 07-Dec 07 Jan 08-Dec 08 Jan 09-Dec 09 Jan 10-Dec 10 Jan 11-Dec 11 Jan 12-May 12
E.4. Estimated anthropogenic emissions by sources of greenhouse gases of the baseline: The GHG emissions (CO2) in the baseline is Total Baseline Emissions (BE y) t CO2 118740 193630 202403 199267 199267 199267 199267 199267 199267 199267 83028
Year Jun 02- Dec 02 Jan 03-Dec 03 Jan 04-Dec 04 Jan 05-Dec 05 Jan 06-Dec 06 Jan 07-Dec 07 Jan 08-Dec 08 Jan 09-Dec 09 Jan 10-Dec 10 Jan 11-Dec 11 Jan 12-May 12
E.5. Difference between E.4 and E.3 representing the emission reductions of the project activity: The total emission reduction during 2002 2012 will be 557826 tCO2 equiv.
page 30
E.6.
Table providing values obtained when applying formulae above: Estimation of Project activity Emission Reductions (tones of CO2e) t CO2 e 85500 139425 145742 143484 143484 143484 143484 143484 143484 143484 59785 1434845
Year Jun 02- Dec 02 Jan 03-Dec 03 Jan 04-Dec 04 Jan 05-Dec 05 Jan 06-Dec 06 Jan 07-Dec 07 Jan 08-Dec 08 Jan 09-Dec 09 Jan 10-Dec 10 Jan 11-Dec 11 Jan 12- May 12 Total (tonnes of CO2 e)
Estimation Baseline Emissions(tones CO2e) t CO2 e 118740 193630 202403 199267 199267 199267 199267 199267 199267 199267 83028 1992671
of Estimation of Estimation of of leakage (tones of emission reduction CO2e) (tones of CO2e) t CO2 e 3634 5926 6194 6098 6098 6098 6098 6098 6098 6098 2541 60982 t CO2 e 33240 54205 56660 55783 55783 55783 55783 55783 55783 55783 23243 557826
SECTION F. Environmental impacts F.1. Documentation on the analysis of the environmental impacts, including transboundary impacts: The Environmental Impact Assessment is not required by the Environmental Impact Assessment notification under Environment Protection Act 1986 (Government of India) for the fuel switch project and hence not conducted as per the requirement of guidelines there under. This assessment is conducted for UPL, as a voluntary initiative to understand the impacts and mitigate any additional impacts that may arise due to the proposed project activity. This project activity has received environmental clearance. The environmental Impact Assessment study showed that overall environmental impacts are not significant. A summary of impacts is presented below: Land use There has no change in land use. The project activity is carried out inside the existing plant. Water quality There will be no impact on water quality of local water source including the rivers. Previously, in the case of Naphtha as primary fuel, for the centrifuge operation, the water requirement was 3 KL/day. In the current project scenario centrifuge is no longer required. This reduces the consumption of water by 1000 KL/annum.
page 31
Air quality The study shows that there is decrease in the gaseous emissions. The following is the change in the various emissions out of the project activity: Gaseous Emissions at the Boiler stack: Parameter Particulate (mg/NM3) SO2 ppm Before &HSD Matter BDL (Naphtha) After (Natural gas) BDL Comments Naphtha start up was on diesel and the start up in the project case is on Natural Gas Diesel/Naphtha has 0.25%/0.03% sulphur and the gas has only 10 ppm sulphur content The project activity also expected to have NOx control which is managed by water injection and this is likely to be more effective in the case of gas
1.5(32.4 KG/Day)
BDL
NOX ppm
26.5(380 KG/Day)
20-22 ppm
Liquid Effluent generation The waste water characteristics have improved due to project activity as the oil and grease concentration has decreased as there is no centrifuging activity involved in natural gas operations like it was in naphtha for removal of impurities and sediments for which water was required. Solid Waste Generation Tank bottom sludge is not expected to be there in the case of Natural gas, in comparison to Naphtha. In the case of Natural gas, in comparison to Naphtha, the filter elements have more life. Accordingly, the solid waste generation is expected to reduce in the case of Natural Gas. Surface and Ground Water. No impact on surface and groundwater sources was anticipated; Flora and Fauna No impacts of ecology flora and fauna, were expected. Employment
page 32
There will be marginal decrease in employment, as the handling of Naphtha required labor and this is not required in the case of natural Gas.
F.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: This project activity has received environmental clearance and the environmental impacts are considered not significant both by the host party and the project participants. As above analysis shows, no significant environmental impacts are expected from this project activity. In fact, only positive impacts are expected, such as better local air quality and GHG emission reductions. More over, reduction in Naphtha and HSD consumption means fewer hazards in transportation and production of the same. Hence, in conclusion, the project does not cause any significant impacts on the environment in the region.
SECTION G. Stakeholders comments G.1. Brief description how comments by local stakeholders have been invited and compiled:
The stakeholders for the project activity were identified at the outset by a team of UPL staff and the stakeholders were duly informed of the consultation meeting. In addition public notices were also issued for the local stakeholder consultation meeting. Local stakeholder consultation meeting to discuss stakeholder concerns on the proposed Clean Development Mechanism (CDM) project - Industrial Fuel switching from Naphtha to Natural gas without extension of capacity and lifetime of the facility at United Phosphorus limited, was held at 03:00 p.m. on 3rd September 2005 at United Phosphorus Limited, GIDC, Jhagadia, Dist: -Bharuch, Gujurat State, India. The meeting elected a chairman to conduct the further proceedings and finally chairman prepared the summary record of the meeting and provided to UPL- copy of which will be made available to Designated Operating Entity during validation process. The local stakeholders appreciated the CDM initiatives and applauded the effort towards clean energy produced. The stakeholders viewed UPL as a reputed company contributing to local environmental benefits and socio-economy through such initiatives. Overall there was unanimous agreement that the project activity was really a proactive initiative by the project party, which contributes, to the sustainable development.
G.2.
Summary of the comments received:
Mr S C Mittal, Vice President, Shriram Alkalis & Chemicals appreciated the efforts made by the UPL and forward thinking they have done. He stressed the point that its a good effort and contributes clean power generation in the local level. He once again highlighted the role of the local stakeholders to articulate any concerns that they may have on the CDM project.
page 33
Mr Amit Jethava, President, GIR Nature Youth Club, Gandhinagar congratulated UPL for their unique efforts. He mentioned this will set a good example for the local industry and they will replicate such kind of project in future The specific concerns expressed by the participants are summarized below along with clarifications provided on such concerns: Stakeholder concerns / question / comment Environment With changing of fuel, is your requirement of water and generation of wastewater increased or decreased? Answer / clarifications
The requirement of water decreases by about 1000 KL/Year due to the project activity and accordingly the quantum of wastewater has also decreased. The waste water characteristics have also improved due to project activity as the oil and grease concentration has decreased as there is no centrifuging activity involved in natural gas operations like it was in naphtha for removal of impurities and sediments for which water was required. When and what kind of public At the time of changing the fuel the permissions under Environmental information that was provided at Protection Act 1986, Water pollution Prevention and Control Act the time of shifting the fuel in 1974 and Air Pollution and Prevention and Control Act 1981 have been obtained and the public was provided due information as 2002? required under these acts and the Factory Act. Economic GGCL contract of gas is going to The extension of gas contract is under discussion and the information expire in 2007, what is GGCL cannot further be divulged, as it is confidential. plan for extension of gas agreement? The result of the stakeholder meet showed that the stakeholders were satisfied with the project activity and the concerns of the stakeholders are cleared with adequate information. The stakeholders appreciated the proactive approach done by UPL through such project implementation. G.3. Report on how due account was taken of any comments received:
The stakeholders were provided clarifications on the issues raised as above to their satisfaction. None of the concerns expressed by the stakeholders required an action to be taken by the UPL during the project operation and at any other stage.
page 34
Annex 1 CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY Organization: Street/P.O.Box: Building: City: State/Region: Postfix/ZIP: Country: Telephone: FAX: E-Mail: URL: Represented by: Title: Salutation: Last Name: Middle Name: First Name: Department: Mobile: Direct FAX: Direct tel: Personal E-Mail: United Phosphorus limited 750, G I D C Jhagadia -Bharuch Gujarat 393110 India +91-2645 226011 +91-2645226017 phatnaniks@uniphos.com www.uplonline.com S. Krishnan Vice President - Commercial Mr. Krishnan -S Commercial 91- 9821088709 91-022-26041010 91-022-26488535 krishnans@uniphos.com
page 35
Annex 2 INFORMATION REGARDING PUBLIC FUNDING This is a unilateral CDM Project Activity undertaken by the project proponent for which no public funding has been used.
page 36
Annex 3 BASELINE INFORMATION Variable Data Source Q_NGy = quantity of natural gas used (Joules) Power plant record, Natural Gas Supplier records ._NG = fuel efficiency of natural gas Calculated from monitored variable Q_F1,y= quantity of HSD used mass unit of HSD Power plant record, Supplier records consumed Q_F2,y = mass unit of Naphtha consumed Power plant record, Supplier records _HSD & Na Calculated from monitored variable Parameter Data Source EFNG =Carbon emissions factor per unit of energy Revised 1996 IPCC Guidelines for National of the Natural Gas Greenhouse Gas Inventories : Workbook Table 1-2 EFHSD =Carbon emissions factor per unit of energy Revised 1996 IPCC Guidelines for National of the HSD Greenhouse Gas Inventories : Workbook Table 1-2 EFNa =Carbon emissions factor per unit of energy Revised 1996 IPCC Guidelines for National of the Naphtha Greenhouse Gas Inventories : Workbook Table 1-2 OXIDNG =Oxidation factor of the fuel Natural Gas Revised 1996 IPCC Guidelines for National (%) Greenhouse Gas Inventories : Workbook Table 1-4 OXIDHSD =Oxidation factor of the fuel HSD (%) Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-4 OXIDNa =Oxidation factor of the fuel Naphtha (%) Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories : Workbook Table 1-4
All baseline information is presented in Section B. Please, refer to that section.
page 37
Annex 4 MONITORING PLAN

Monitoring and Verification Protocol for Energy Input and Energy Output
Energy Output Frequency of Calibration / Frequency Reading & recording Location of reading calibration/Veri Calibaration Agency Checking of reading responsibility recording* fication of / Ref: Standard Responsibility meters
Sl. No.
Variables
Meter
Meter location
EGGEN
GTG meter
power plant control room
Daily
Shift In Charge
electrical SAP/ Daily generation once in 3/5 years engineer/power plant
Gujarat Electricity Board /Electricity ACT
EGAUX
Incomer one PMCC meter
power plant control room
Daily
Shift In Charge
electrical SAP/ Daily generation once in 3/5 years engineer/power plant
Gujarat Electricity Board /Electricity ACT
Energy Input
Q1
Custody Gas meter
GTCL metering skid / UPL site
Daily
Shift In Charge
Gas Ticket / pp daily generation/sap entry
Monthly
Joint caliberation by Gujarat Gas / AGA3 Gujarat gas and UPL
NCV
Gas chromatograph
Sampling Point / Amboli
Daily
Guj. Gas /amboli shift incharge
Gas Ticket / GTCL,surat
Bi-monthly
Gujarat Gas/GTCL
ABB / ISO-6976
All other monitoring plan is presented in Section D. Please, refer to that section.

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Clean Development Mechanism Project Design Document Form (CDM-PDD) Version 02 - in Effect As Of: 1 July 2004)

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PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 02 CDM Executive Board

Estimated amount of emission reductions over the chosen crediting period:

557826 10 years 55783

www.powermin.nic.in/acts_notification/ electricity_act2003/preliminary.htm - 41k http://pib.nic.in/archieve/factsheet/fs2000/coal.html http://www.mbendi.co.za/indy/ming/coal/as/in/p0005.htm CEA General Review 1999-00

Units 000' MT 000' MT Kilo Ltrs M. Cu.Mts.

2003-2004 15856 2560 405808 1574

2002-2003 19298 1931 426280 851

2001-2002 16722 1107 139937 538

2000-2001 15940 1144 469945 847

0 2003-2004 2002-2003 Year 2001-2002 2000-2001

NPV (with (828.64) CER)

NPV (with (280.63) CER)

Boilers that are part of process cycle generating Power

Direct FAX: Direct tel: Personal E-Mail:

+91-22-24913417 +91-22-56619341 ...

PWC is not a project participant as meant in Annex I.

For how long is archived data kept?

Quantity of natural gas used

Apex Control System, Power plant records

For how long is archived data kept?

Power plant records Power plant records

100% 100% 100%

Project lifetime Project lifetime Project lifetime

Calculated as n,operation pattern Qn_F1,,y Calculated as n,operation pattern Qn_F2,y

Calculated from monitored variable Calculated from monitored variable

The calculation is based on historical consumption

The calculation is based on historical consumption.

Electronic /paper Electronic/ paper

To be checked in the starting of the crediting

For how long is archived data kept?

constraints in using naptha and other petroleum fuel

period as there is no renewal

Data (Indicate table and ID number e.g. 3.-1.; 3.2.) 1-6 7

Designation Project Head:

Operation Engineer (one in a shift)

collection ,Checking data accuracy ,Data recording

Name of person/entity determining the monitoring methodology:

Summary of the comments received:

Annex 4 MONITORING PLAN

power plant control room

electrical SAP/ Daily generation once in 3/5 years engineer/power plant

Gujarat Electricity Board /Electricity ACT

Incomer one PMCC meter

power plant control room

electrical SAP/ Daily generation once in 3/5 years engineer/power plant

Gujarat Electricity Board /Electricity ACT

Custody Gas meter

GTCL metering skid / UPL site

Gas Ticket / pp daily generation/sap entry

Joint caliberation by Gujarat Gas / AGA3 Gujarat gas and UPL

Sampling Point / Amboli

Guj. Gas /amboli shift incharge

Gas Ticket / GTCL,surat

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