PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03

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CLEAN DEVELOPMENT MECHANISM PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) Version 03 - in effect as of: 22 December 2006 CONTENTS A. B. C. D. E. General description of the small scale project activity Application of a baseline and monitoring methodology Duration of the project activity / crediting period Environmental impacts Stakeholders comments Annexes Annex 1: Contact information on participants in the proposed small scale project activity Annex 2: Information regarding public funding Annex 3: Baseline information Annex 4: Monitoring Information

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Revision history of this document

Version Number 01 02

Date 21 January 2003 8 July 2005

Description and reason of revision Initial adoption The Board agreed to revise the CDM SSC PDD to reflect guidance and clarifications provided by the Board since version 01 of this document. As a consequence, the guidelines for completing CDM SSC PDD have been revised accordingly to version 2. The latest version can be found at <http://cdm.unfccc.int/Reference/Documents>. The Board agreed to revise the CDM project design document for small-scale activities (CDM-SSC-PDD), taking into account CDM-PDD and CDM-NM.

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SECTION A. General description of small-scale project activity A.1 Title of the small-scale project activity: >> 10MW biomass power plant at Sangli by Sinewave Power Version 01 01/12/2009

A.2.

Description of the small-scale project activity:

>> The proposed CDM project activity is undertaken by Sinewave Biomass Power Pvt Ltd and involves the establishment of a 10 MW biomass based power plant. The plant will utilise agricultural wastes, mainly babul wood (40%), bagasse (40%) and other agro residues (20%) available in the area surrounding the plant. The purpose of the project activity is to generate electricity by the combustion of the agricultural wastes and export it to the Maharashtra State Electricity Distribution Company Limited (MSEDCL) through Maharashtra State Electricity Transmission Company Limited (MSETCL). The proposed plant comprises the installation of a boiler of 50 TPH capacity and a single extraction cum condensing turbo generator set of 10MW. The project proponent intends to install these and ancillary equipments to generate electricity for the grid from a renewable energy source (babul wood, bagasse and agro product residues). The boiler would generate steam at 66 bar pressure and 490 5oC. The power generation would be at 11 kV and would be stepped up to 33 kV for synchronizing with the grid. The plant is located about 6 kms from the nearest MAHADISCOM sub-station. The necessary transmission lines from the power plant to the substation would be laid by the project activity. The project activity will reduce emissions through the generation of electricity from renewable biomass, which is carbon neutral, and replace and supplement existing grid based generation which is predominantly fossil fuel based. Sustainable Development The project activity will contribute to sustainable development through socio-economic and environmental development in the region. The proposed project activity will generate new job opportunities for the local community and the development of basic amenities leading to an improvement in the living standards of the local community. People from the local area will be employed during the construction and operation of the project activity which will indirectly leads to economic benefits in the area. Environmental Benefits The generation of electricity for supply to the grid from a renewable source will have a direct environmental benefit. The generation of power from biomass has long term benefits related to climate change given that the alternative source of generation in India is typically a fossil fuel based generation

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system. Local pollution will also be reduced as these alternatives are predominantly coal based combustion for the supply of electricity which gives rise to increased emissions of NOx, SOx and ash. A.3. Project participants: >> Name of Party involved ((host) indicates a host Party)

Private and/or public If Party wishes to be entity(ies) project participants considered as a project (as applicable) participant India (host) No Private Entity: Sinewave Biomass Power Pvt Ltd United Kingdom No Private Entity: Agrinergy Pte Ltd (*) In accordance with the CDM modalities and procedures, at the time of making the CDM-PDD public at the stage of validation, a Party involved may or may not have provided its approval. At the time of requesting registration, the approval by the Party(ies) involved is required.

A.4. >> >>

Technical description of the small-scale project activity: A.4.1. Location of the small-scale project activity:

A.4.1.1. >> India A.4.1.2. >> Maharashtra

Host Party (ies):

Region/State/Province etc.:

A.4.1.3. City/Town/Community etc: >> Tung village, Miraj Taluka, Sangli District. A.4.1.4. Details of physical location, including information allowing the unique identification of this small-scale project activity : >> The project activity is located at Tung Village, Taluka Miraj of Sangli district in the state of Maharashtra. The site is located at 1655'36"N latitude and 7428'48"E longitude. The following map shows the exact location of the project activity.

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Location site of Plant, Tung Village

A.4.2. Type and category (ies) and technology/measure of the small-scale project activity: >> According to the Appendix B to the simplified modalities and procedures for small-scale CDM project activities, the proposed project activity falls under the following type and category. Type I Renewable Energy Projects Category D - Grid connected renewable electricity generation1

http://cdm.unfccc.int/methodologies/SSCmethodologies/approved.html.

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The capacity of the proposed CDM project is 10 MW, which is below the qualifying capacity of 15 MW as outlined in section ID of Appendix B of the simplified modalities for small scale CDM project activities. The biomass power plant will be connected to the grid and the electricity produced by the plant will replace existing and planned generation from the grid. As the maximum electricity generating capacity is limited by its design and construction, there is no possibility of exceeding the limits of smallscale CDM project activities during the crediting period and the project activity will remain as a small scale project activity. Technology The project is designed to generate electricity for grid system using biomass fuel such as babul wood, bagasse and agro product residue. The basic technology is the Rankine cycle route where direct combustion of biomass materials takes place through the AFBC boiler to generate high pressure and high temperature steam, which drives an impulse turbine generator set. The main plant and machinery of the project consists of one 50 TPH AFBC boiler, one single extraction cum condensing turbo generator set, power evacuation system and fuel handling system. The turbo generator will generate electricity at 33/11 kV level. The substation is located at MAHADISCOM substation which is about 6 km from the project site. The technology to be employed is domestically available in India and the main equipments, i.e. boiler and turbine, are supplied by well-known Indian manufacturers. All equipments are designed as per industry guidelines and meet the national environmental and safety guidelines and comply with the criteria laid down by the Maharashtra State Pollution Control Board. No technology transfer is envisaged for the proposed CDM project activity. The detail description of the plant as given in following table Boiler Type Boiler capacity (100 % load) / Steam Flow rate Steam pressure at super heater outlet Steam temperature at super heater outlet Water requirement Turbo Generator Type Steam pressure at the TG inlet Steam temperature at the TG inlet Generator Voltage Power evacuation Grid Voltage MAHADISCOM Sub station Energy production Gross power Auxiliary consumption (10%) Net power for export

AFBC 50TPH 66k kg/cm2 490 o C 65 m3 / hour Single extraction cum condensing 66 kg/cm2 490 oC 11 kV 33 kV 33/11 kV 10 MW 1.0 MW 9.0 MW

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A.4.3 Estimated amount of emission reductions over the chosen crediting period: >> The chosen crediting period for the project activity is 7 years. It is estimated that the project activity would generate 369,690 emission reductions during the crediting period of 7 years. Annual estimates of emission reductions by the project activity during the above crediting period are furnished below. Year June 2010-May 2011 June 2011-May 2012 June 2012- May 2013 June 2013-May 2014 June 2014-May 2015 June 2015-May 2016 June 2016-May 2017 Total estimated reductions (tonnes CO2e) Total number of crediting years Annual average over the crediting period of estimated reductions (tonnes of CO2e) Annual estimation of emission reductions in tonnes of CO2e 48090 51095 54101 54101 54101 54101 54101 369690 7 52812

A.4.4. Public funding of the small-scale project activity: >> The project has not received any public funding. A.4.5. Confirmation that the small-scale project activity is not a debundled component of a large scale project activity: >> Appendix C, paragraph 2 of the Simplified Modalities and Procedures for Small-Scale CDM project activities states: A proposed small-scale project activity shall be deemed to be a debundled component of a large project activity if there is a registered small-scale CDM project activity or an application to register another small-scale CDM project activity: With the same project participants; In the same project category and technology/measure; and Registered within the previous 2 years; and Whose project boundary is within 1 km of the project boundary of the proposed smallscale activity at the closest point.

The proposed project activity satisfies the criteria mentioned above and thus is not a debundled component of a large scale project activity.

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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 small-scale project activity: >> Type I Renewable Energy Projects Category D - Grid connected renewable electricity generation2 Version 15, valid from 30th October 2009 B.2 Justification of the choice of the project category: >> This category comprises renewable energy The proposed project activity satisfies this generation units, such as photovoltaics, hydro, condition as it involves renewable energy tidal/wave, wind, geothermal and renewable generation, i.e. using biomass, that supplies biomass, that supply electricity to and/or displace electricity to the regional grid that would have electricity from an electricity distribution system been generated by a mix of fossil fuel fired that is or would have been supplied by at least one generating units supplying to the regional grid. fossil fuel fired generating unit. Hydro power plants with reservoirs that satisfy at The proposed project activity is biomass power least one of the following conditions are plant and not a hydro power plant. eligible to apply this methodology: The project activity is implemented in an existing reservoir, with no change in the volume of reservoir; The project activity is implemented in an existing reservoir, where the volume of reservoir is increased and the power density of the project activity, as per definitions given in the Project Emissions section, is greater than 4 W/m2; The project activity results in new reservoirs and the power density of the power plant, as per definitions given in the Project Emissions section, is greater than 4 W/m2. If the unit added has both renewable and nonThe proposed project activity does not involve any renewable components (e.g. a wind/diesel unit), the non-renewable components. eligibility limit of 15MW for a small-scale CDM project activity applies only to the renewable component. If the unit added co-fires fossil fuel1, the capacity of the entire unit shall not exceed the limit of 15MW. Combined heat and power (co-generation) The project activity is not a co-generation unit. systems are not eligible under this category.

http://cdm.unfccc.int/methodologies/SSCmethodologies/approved.html.

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In the case of project activities that involve the addition of renewable energy generation units at an existing renewable power generation facility, the added capacity of the units added by the project should be lower than 15 MW and should be physically distinct from the existing units. Project activities that seek to retrofit or modify an existing facility for renewable energy generation are included in this category. To qualify as a smallscale project, the total output of the modified or retrofitted unit shall not exceed the limit of 15 MW.

The project activity is a new activity of 10 MW capacity.

The proposed project activity does not involve the retrofitting or modification of an existing facility for renewable energy generation.

B.3. Description of the project boundary: >> In line with the guidance in Appendix B of the simplified modalities and procedures for small-scale CDM project activities the boundary encompasses the physical, geographical site of the renewable generation source.

Biomass from near by site Biomass residue

Biomass fired boiler (50TPH, 66 kg/cm2, 490 oC)

Turbo Generator Auxillary Consumption For the End User Electricity to Grid

Project boundary

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purpose of the project activity the relevant grid is defined by the power generating units serving the same grid as the project activity. In line with the tool to calculate the grid emission factor ,which states that If the DNA of the host country has published a delineation of the project electricity system and connected electricity systems, these delineations should be used, we have considered the regional grid that is delineated by the Central Electricity Authority of India. In the case of India there are regional grids which facilitate the transfer of electricity between states and which are supplied by central sector power stations operating in the region. The Indian power system is divided into two grids for the purposes of calculating the grid emission factor, namely the new integrated Northern, Eastern, Western, and North-Eastern regional grids (NEW NE) and the Southern grid. Maharashtra is a part of the western region as per the grid definitions outlined by the CEA and we have therefore utilized the analysis of the NEWNE grid undertaken by the CEA in order to determine the baseline emission factor for electricity generation. B.4. Description of baseline and its development: >> The project activity comprises the installation of a 10MW turbine generator that generates electricity by combusting biomass residues and the generated electricity is supplied to the grid. This generated electricity would otherwise have been supplied by at least one fossil fuel fired generating unit connected to the grid. The project activity does not use landfill gas, waste gas or wastewater treatment nor does it exclusively use fuel oil and/or diesel oil thus negating baseline scenarios in paragraph 7 and 8 of methodology AMS ID. The project activity does not involve addition of renewable energy generation units at an existing renewable power generation facility nor does it seek to retrofit or modify an existing facility thus negating baseline scenarios in paragraph 11 and 12 of the methodology. The grid has been taken as the baseline as mentioned in paragraph 9 of the methodology for the project activity and the baseline emissions therefore are calculated as the product of electrical energy baseline EGBL, y expressed in kWh of electricity produced by the renewable generating unit multiplied by an emission factor The emission coefficient has been calculated as mentioned in paragraph 10 (a) in a transparent and conservative manner as the combined margin (CM), consisting of the combination of operating margin (OM) and build margin (BM) according to the procedures prescribed in the Tool to calculate the emission factor for an electricity system. This has been calculated by the Central Electricity Authority (CEA) for the regional grids in India. The following data sources have been used in the determination of the baseline: Variable Energy exported Grid emission factor Parameter EGBL,y EFCO2 Data sources Plant setup CEA

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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 small-scale CDM project activity: >> In line with attachment A to appendix B of the simplified M&P for small scale CDM project activities, the demonstration of additionality focuses on the barriers facing the project. As a part of additionality, an investment analysis has been performed to demonstrate that the project activity faces an investment barrier. In showing that the project is additional we demonstrate that it is not a part of the baseline scenario, which in the case of the project activity is the generation of electricity in fossil fuel based grid power plants. The project activity has to overcome significant investment barriers for its successful implementation. The project participant proposes to use Benchmark Analysis. The indicator for comparison used as the benchmark is chosen as the Weighted Average Cost of Capital (WACC). The expected cost of equity and weighted average of cost of capital (WACC) for the power generating industry in India has been calculated using the CAPM approach. The weighted average cost of capital has been calculated considering the bank prime lending rate (PLR) at the time the investment decision was taken which is 18th June 2009 as the cost of debt3. The cost of equity has been determined using the Capital Asset Pricing Model Approach considering Beta values of power generating companies in India that were listed at the time of the investment for this project. As per the CAPM model, the expected return of equity for the project is estimated as follows: Rf + *( Rm - Rf ) Where Rf = Risk free rate of return = Beta Rm = Market returns Rm - Rf = Market risk premium. Risk free rate of return: The risk free rate of return is a benchmark figure against which all the investments in an economy should be measured. The risk free rate of return has been taken as the average ten year yield for Government securities4 at the time of the project start date. The risk free rate of return is 7.67%. Market return and risk premium: The market risk premium, as measured and applied in practice is the premium above the risk free rate if return that investors expect to earn on a portfolio of equities. With a view of eliminating the unsystematic risk associated with the projects totally, index containing 500 companies has been taken to represent the market return. A period starting since 1999 till the start date has been considered in order to remove any short term volatility. Therefore the risk premium has been calculated as the difference in compounded annual return between the BSE500 and the Government bond rates. The value calculated is 9.34%
3 4

http://www.rbi.org.in/scripts/WSSView.aspx?Id=13654 http://www.rbi.org.in/scripts/AnnualPublications.aspx?head=Macroeconomic+and+Monetary+Developments

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Beta: Equity beta measures the risk that cannot be eliminated in a systematic, well balanced and diversified portfolio. Equity beta is calculated as the covariance between its return and the return of a well diversified market portfolio, divided by a variance of the return of a well diversified market portfolio. Equity Beta = Covariance (r,rm)/Variance (rm) Where, r is the return from the equity investment in a single stock rm is the return from the equity investment in the well diversified market portfolio The measured equity beta for a particular company relates to the unique capital structure of that company and a change in the capital structure will change the degree of financial risk borne by the equity holders and hence the equity beta. In order to allow the comparison of equity betas across companies with different capital structures, the estimated equity beta is adjusted into the equivalent asset beta (which is the equity beta that would apply if the assets were financed wholly with equity). This is done as follows, Asset beta = Equity Beta/[1+(1-Tax) x (debt/equity)] Therefore, the average value of the asset betas of the listed power generating companies in India has been considered and this is calculated to be 1.01. For calculation a debt equity ratio of 65:35 has been considered Therefore: Cost of equity = 7.67% + (1.01)* 9.34% which is 17.14% WACC = 65%* 12.50% *(1-16.89%) + 35%* 17.14% WACC = 14.80% The IRR without CDM is calculated to be 8.34% and is below the benchmark calculated. The revenues from the project activity are from the sale of electricity to the grid. The operating costs include the fuel cost, the costs to be incurred through the operation and maintenance, employee salary and welfare, administration and insurance. These costs and revenues have been detailed in the spreadsheet provided to the DOE. The financial analysis has been undertaken over a period of 20 years. The basic assumptions in performing the financial analysis are outlined in the table below. Parameter Installed capacity PLF Value Basis of assumption 10 MW Purchase orders 80% for year 1; 85% for year DPR 2 ; 90% from year 3 onwards

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Total project cost Repair and maintenance cost Escalation Admin costs Escalation Salaries Escalation Other manufacturing expenses Biomass residue cost Escalation Income tax rate MAT rate Tariff CER price Exchange rate

INR 588.224 million INR 7.50 million 5% INR 3.60 million 5% INR 8.40 million 5% INR 10 million Rs 1500/tonne

DPR DPR DPR DPR DPR DPR DPR DPR

MERC 2009 tariff order and quotations from vendors 2% DPR 33.99% Standard values 11.33% Standard values Rs 4.28 for the first year and MERC tariff order and DPR remaining years 11/ CER INR 65

Based on the above assumptions the project IRR is calculated as 8.34% without the CDM revenues. All the workings and assumptions are in line with recognized standards and will be made available to the DOE during validation. Sensitivity analysis The sensitivity analysis has been done in accordance with EB 41, Annex 45 Guidance on the Assessment of Investment Analysis paragraph 16 and 17. The following factors are expected to have a significant impact on the financial internal rate of return of the project and hence sensitivity analysis has been conducted for these: 1. Plant Load Factor 2. Electricity Tariff 3. Investment Costs 4. Fuel Costs The financial analysis has been carried out taking into account the value of PLF of 80% in the first year, 85% in the second year and 90% for the remaining years. Even when the PLF is increased by 10% the IRR is 11.06% which remains below the benchmark considered. (-10%) Project IRR without CDM 5.30% (-5%) 6.88% PLF 8.34% (+5%) 9.72% (+10%) 11.06%

The electricity tariff has been fixed by the Maharashtra State Electricity Board for twenty years i.e. through out the life of the project activity. This parameter is important as it determines the only revenues

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of the project activity aside from carbon revenues. The table below shows the impact of an increase in the tariff and even when the tariff is raised by 10% it is still below the benchmark. (-10%) Project IRR without CDM 0.45% (-5%) 4.96% Tariff 8.34% (+5%) 11.24% (+10%) 13.97%

In line with the guidance on sensitivity we adjust the investment costs by +10% to -10%, the results of this are shown in the following table and the project IRR remains below the benchmark. (-10%) Project IRR without CDM 10.07% (-5%) 9.17% Base Case 8.34% (+5%) 7.58% (+10%) 6.87%

Biomass residues used as a fuel in this project activity are subject to sensitivity analysis as they constitute more than 20% of the total costs. However, even with a 10% reduction in these costs the project IRR does not cross the benchmark. (-10%) Project IRR without CDM 11.78% (-5%) 10.12% Base Case 8.34% (+5%) 6.39% (+10%) 4.15%

Thus all the necessary parameters have been subjected to sensitivity analysis and it has been shown that the project remains additional, thus it can be concluded that CDM revenues are essential for the successful implementation of the project. B.6. Emission reductions:

B.6.1. Explanation of methodological choices: >> As per paragraph 9 of the methodology the baseline emissions are calculated as the product of electrical energy baseline EGBL, y expressed in kWh of electricity produced by the renewable generating unit multiplied by an emission factor, which is the combined margin emission factor of the grid. Baseline Emissions

BE y = EGBL , y EFCO 2

Where:

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BEy = Baseline emissions in year y, tCO2e EGBL,y = EGy = Energy Baseline in the year y which is the electricity exported to the grid in year y, MWh EFC02 = C02 emissions factor, tCO2e/MWh which is the grid emission factor This is calculated in accordance with paragraph 10(a) of AMS I.D which states that A combined margin (CM), consisting of the combination of operating margin (OM) and build margin (BM) according to the procedures prescribed in the Tool to calculate the emission factor for an electricity system. The CEA value of the grid EFCO2 that we have considered is the weighted average using 50:50 weights for the OM and BM. Using the fixed carbon dioxide emissions factor determined in section B4, this equation may be simplified to the following:

BE y = EG y 0.84
Project Emissions The emissions due to transport of the biomass to the project plant are calculated as:

PE y = N y AVD y EFkm,CO 2
Where: PEy = CO2 emissions during the year y due to transport of the biomass residues to the project plant (tCO2/yr) Ny = Number of truck trips during year y AVDy = Average round trip distance (from and to) between the biomass residue supply sites and the site of the project plant during the year y (km)

EFkm ,CO 2

= Average CO2 emission factor for the trucks measured during the year y (tCO2/km)

This is calculated in accordance with ACM0006, option 1, in which project emissions are calculated based on the number of trips and average return distance Leakage In line with the guidance provided in the methodology, leakage is only considered for the transfer of equipment, as there is no transfer this may be neglected. With reference to the general guidance on leakage in biomass project activities, we have to consider the possibility of leakage in the case of the project activity as it utilizes biomass residues from external sources. Leakage may occur because of the diversion of biomass from other activities outside the boundary thus increasing the fossil fuel combustion outside the boundary. Considering that the biomass requirement for the project is small and that there is sufficient biomass available in the region surrounding the site of the project activity, no such leakage is anticipated. However a survey has been undertaken ex-ante to ensure that there is surplus biomass in the region and hence the usage of biomass in the project activity does not lead to leakage elsewhere. The biomass surplus assessment survey shall be carried out at the start of each crediting period.

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Emission Reductions The emission reductions are therefore calculated as follows:

ER y = BE y PE y

B.6.2. Data and parameters that are available at validation: (Copy this table for each data and parameter) Data / Parameter: Data unit: Description: Source of data used: EFy tCO2/MWh Grid emission factor Central Electricity Authority http://cea.nic.in/planning/c%20and%20e/Government%20of%20India%20web site.htm 0.84 This value has been provided by the Central Electricity Authority (CEA), a government body, for the NEWNE grid in India.

Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment: Data / Parameter: Data unit: Description: Source of data used:

Specified ex-ante OM tCO2/MWh Operating Margin for grid Central Electricity Authority http://cea.nic.in/planning/c%20and%20e/Government%20of%20India%20web site.htm 1.0 Average of values for the past 3 years. This value has been provided by the Central Electricity Authority (CEA), a government body, for the NEWNE grid in India.

Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment: Data / Parameter: Data unit: Description:

BM tCO2/MWh Build Margin for the grid

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Source of data used:

Central Electricity Authority http://cea.nic.in/planning/c%20and%20e/Government%20of%20India%20web site.htm 0.68 This value has been provided by the Central Electricity Authority (CEA), a government body, for the NEWNE grid in India.

Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment: Data / Parameter: Data unit: Description: Source of data used: Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment:

SCbiomass tonnes/MWh Specific fuel consumption of biomass residues Calculated based on specifications provided by the manufacturer 1.38 Specific fuel consumption is calculated based on specifications for boiler and turbine. In calculating the specific fuel consumption we have taken into account GCV values of the three fuels which is 40% bagasse, 40% babulwood and 20% agro-residues. The GCV values for babulwood = 3600 kcal, bagasse = 2900kcal, agro residue= 2900 kcal respectively.
http://www.indiasolar.com/cal-value.htm

Specified Ex-ante

B.6.3 Ex-ante calculation of emission reductions: >> From section B.6.1, the emission reductions are calculated as follows:

ER y = BE y PE y
Baseline emissions The baseline emissions are calculated as:

BE y = EG y .EFC 02
Where: BEy = Baseline emissions in year y, tCO2e EGy = Electricity exported to the grid in year y, MWh EFC02 = Grid emissions factor, tCO2e/MWh The quantity of electricity generated is equal to the difference between gross electricity generated and the electricity used for auxiliary consumption and is based on factors such as installed capacity, operating days and the plant load factor (PLF). It is initially assumed that the 10 MW plant will operate for 330

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days at 80% PLF for generation during the first year and 85% in the second year and 90% from the third year onwards. The auxiliary consumption is 10%. Hence, EGy which is given as:

EG y = EGgross EGaux
Where: EGgross = Gross electricity generated by the project activity in the year y, MWh EGaux = Auxiliary consumption due to the project activity in the year y, MWh

EGgross = Capacity Operating days Hours PLF

For year 1 Based on the values above, EGgross is equal to 63,360 MWh and with 10% auxiliary consumption EGy = 57,024 MWh. EFy fixed ex ante as per Section B.6.2 at 0.84 based on the CEA value for the NEWNE grid Using the value of EFy = 0.84 tCO2/MWh gives BEy = 48,090 tCO2. For year 2 EGgross is equal to 67,320 MWh and with 10% auxiliary consumption EGy = 60,588 MWh. BEy = 51,095 tCO2. From year 3 onwards PLF is 90% and auxiliary consumption remains at 10% EGgross = 71,280 MWh EGy = 64,152 MWh BEy = 54,101 tCO2. Project emissions The emissions due to transport of the biomass to the project plant are calculated as:

PE y = N y AVD y EFkm,CO 2
Where: PEy = CO2 emissions during the year y due to transport of the biomass residue to the project plant (tCO2/yr) Ny = Number of truck trips during year y AVDy = Average round trip distance (from and to) between the biomass supply sites and the site of the project plant during the year y (km) EFkm,CO2 = Average CO2 emission factor for the trucks measured during the year y (tCO2/km)

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However as per SSG WG report 22 SSG WG agreed to clarify that emissions related to transport of biomass is only required if these are transported over a distance of more than 200 kilometres Hence project emissions in this case can be neglected. However the distance will be monitored and if it is greater than 200km the project emissions will be taken into account. Emission reductions are provided by the following equation:

ER y = BE y PE y
From the analysis above the emission reductions are calculated as 48,090 tCO2 for the first year of operation. B.6.4 >> Year June 2010-May 2011 June 2011-May 2012 June 2012-May 2013 June 2013-May 2014 June 2014-May 2015 June 2015-May 2016 June 2016-May 2017 Total ( tonnes of CO2 e) Summary of the ex-ante estimation of emission reductions: Estimation of project activity emission (tCO2e) 0 0 0 0 0 0 0 0 Estimation of baseline emissions (tCO2 e) 48,090 51,095 54,101 54,101 54,101 54,101 54,101 369690 Estimation of Leakage (tCO2 e) 0 0 0 0 0 0 0 0 Estimation of overall emission reductions (tCO2 e) 48,090 51,095 54,101 54,101 54,101 54,101 54,101 369690

B.7 Application of a monitoring methodology and description of the monitoring plan: >> B.7.1 Data and parameters monitored: (Copy this table for each data and parameter) Data / Parameter: Data unit: Description: Source of data to be used: Value of data Description of measurement methods and procedures to be applied: QA/QC procedures to be applied: Any comment: EGgross MWh Gross electricity generated by the project activity in year y Energy meter readings from plant records 63,360 for year 1; 67,320 for year 2; 71,280 from year 3 onwards Data will be continuously recorded from the turbine and the Shift Electrical incharge will take hourly readings. This will be collated at the end of each day and reported to the Site in-charge. The generation energy meters will be calibrated at least once every three years by the MSEB. All data will be kept for a minimum of 2 years following issuance of certified

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emission reductions or the end of the crediting period, whichever is later. Data / Parameter: Data unit: Description: Source of data to be used: Value of data Description of measurement methods and procedures to be applied: QA/QC procedures to be applied: Any comment: EGaux MWh Auxiliary consumption by the project activity in year y Plant records 6,336 for year 1; 6,732 for year 2; 7,128 from year 3 onwards Data will be continuously recorded from the turbine and the Shift Electrical incharge will take hourly readings. This will be collated at the end of each day and reported to the Site in-charge. The meters will be calibrated at least once every three years. 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.

Data / Parameter: Data unit: Description: Source of data to be used: Value of data Description of measurement methods and procedures to be applied: QA/QC procedures to be applied: Any comment:

EGnet MWh Net electricity generated by the project activity in year y It is a calculated value 57,024 for year1; 60,588 for year2; 64,152 for year3 Calculated as: EGnet = EGgross - EGaux

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. EFkm, CO2 tCO2/km Emission factor for transport of biomass 1996 IPCC Guidelines for National Greenhouse Gas Inventories, Chapter 1 Ref4, Table 1-32 0.00110799 The data from the plausible options in Table 1-32 of IPCC 1996 report has been chosen most conservatively, i.e. we have chosen data that results in the highest emission factor which will result in the largest transport emissions.

Data / Parameter: Data unit: Description: Source of data used: Value applied: Justification of the choice of data or description of measurement methods and procedures actually applied : Any comment:

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Data / Parameter: Data unit: Description: Source of data to be used: Value of data Description of measurement methods and procedures to be applied: QA/QC procedures to be applied: Any comment:

Mbiomass,y Tonnes Amount of biomass input in the project activity Plant records 87,175 for year 1; 92,623 for year 2; 98,072 from year 3 onwards All the biomass is brought from outside. Each truck that enters the site will be recorded at the weighbridge installed at the factory.

The weighbridge records will be tallied against transporters receipts or against the computer generated payment invoices. The data will be kept for the later of, two years after the end of the crediting period or the last issuance of CERs for the project activity. 100% of the data will be monitored. AVDy Km Average return distance of trips undertaken to transport biomass to the project site Transporters receipts 100 The average return distance will be recorded for each truck on entry to the site. 100% of the data will be monitored.

Data / Parameter: Data unit: Description: Source of data to be used: Value of data Description of measurement methods and procedures to be applied: QA/QC procedures to be applied: Any comment:

This data may be cross checked with payments for transportation of the material. The data will be kept for the later of, two years after the end of the crediting period or the last issuance of CERs for the project activity. 100% of the data will be monitored.

B.7.2 Description of the monitoring plan: >> This monitoring plan is developed in accordance with the modalities and procedures for small-scale CDM project activities and is proposed for the grid-connected biomass based renewable energy project being implemented. The monitoring plan, which will be implemented by the project proponent, describes the monitoring organization, the parameters to be monitored, the monitoring practices, quality assurance, quality control procedures, data storage and data archiving. Monitoring requirement The monitoring plan includes monitoring of energy parameters such as Type and Quantity of each type of biomass fuel consumption of the project activity, (tons)

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Gross electricity Generation (MWh) Net quantity of electricity generated (exported) by the project activity (MWh) Electricity generation As per the small scale methodology AMS I.D, monitoring shall consist of metering the electricity generated by the renewable technology. The generation data from the turbine will be continuously recorded using the electricity meters in the control room. A manual hourly record will be made by the Shift in-charge. This data will be collated at the end of each day by the Electrical in-charge and reported on a daily basis to the Site in-charge. This data will form the basis of the ongoing calculation which will then be tallied against the monthly recordings taken by the MSEDCL along with a representative from the factory. The Site Head will be responsible for collating all electrical data monthly out of the daily data (electricity exported to the grid). He will transmit these data monthly to the Plant Manager. The electricity meter will be calibrated atleast once in three years by MSEDCL. The Instrumentation Engineer will be in charge of maintaining the records of the calibrations on site. Evaluation of biomass As per EB 47, annex 28 The project participant shall evaluate ex ante annually if there is a surplus of the biomass in the region of the project activity, which is not utilised. If it is demonstrated (e.g., using published literature, official reports, surveys etc.) at the beginning of each crediting period that the quantity of available biomass in the region (e.g., 50 km radius), is at least 25% larger than the quantity of biomass that is utilised including the project activity, then this source of leakage can be neglected otherwise this leakage shall be estimated and deducted from the emission reductions. We have therefore excluded the monitoring of leakage parameters as a biomass survey has been undertaken and the results of the same have been provided to the DOE. Fuel consumption The consumption of the fuel will be monitored at the weighbridge installed at the site. The amount of each type of fuel brought in by the plant will be monitored separately by the weighbridge operator. Besides, the measurement of transport emissions is undertaken through monitoring of the number of trucks delivering biomass and the average return distance to the site from which biomass is collected. These data will be collected continuously by the weighbridge operator and will be collated at the end of each day by the Plant Manager. The weighbridge records will be tallied against transporters receipts or against the computer generated payment invoices. The Plant Manager will collate monthly the consumption of all types of fuels, the number of trucks, the average truck load and the average return distance out of the daily data. The weighbridge will be calibrated annually and the Instrumentation Engineer will be in charge of the calibrations and of maintaining the records of the calibrations on site. General The staff will be trained to ensure that the monitoring process is appropriate and effective. The CDM data will be collated monthly and maintained by the Plant Manager. A detailed monitoring and verification report will be produced by the plant on a yearly basis.

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The meters used will be calibrated regularly as per requirements. In case, the meters are found outside the acceptable limits of accuracy or if not functioning properly, necessary action will be taken and the meters will be repaired or replaced immediately. The Instrumentation engineer will be in charge of calibrations and of maintaining the records of calibrations on site. The project proponent shall keep complete and accurate records of all the data as a part of monitoring for at least a period of 2 years after the end of the crediting period or the last issuance of CERs for the project activity, whichever occurs later. B.8 Date of completion of the application of the baseline and monitoring methodology and the name of the responsible person(s)/entity(ies) >> 10/10/2009 Mr. Gambhirmal R Shah, Sinewave Biomass Power Pvt Ltd, contact details as listed in Annex1 Ms. Roshni Kumar, Agrinergy Consultancy Private Limited, roshni.kumar@agrinergy.com

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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: >> 26/05/2009 Letter of intent for Boiler purchase C.1.2. Expected operational lifetime of the project activity: >> 21y 00m C.2 Choice of the crediting period and related information:

C.2.1. Renewable crediting period >> A 7 year renewable crediting period has been chosen C.2.1.1. Starting date of the first crediting period:

>> 01/06/2010 or the date of registration, whichever is later. C.2.1.2. >> 7y 00m C.2.2. Fixed crediting period: C.2.2.1. >> Not applicable C.2.2.2. >> Not Applicable Length: Starting date: Length of the first crediting period:

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SECTION D. Environmental impacts >> D.1. If required by the host Party, documentation on the analysis of the environmental impacts of the project activity: >> In relation to the baseline scenario no negative environmental impacts will arise as a result of the project activity. The positive environmental impacts arising from the project activity are: Reduction in CO2 emissions, which would be generated under the baseline scenario, by the replacement of fossil fuels Reduction in the emissions of other harmful gases (NOx and SOx) that would have been emitted from the combustion of fossil fuels for power generation in power plants connected to the grid. Reduced ash production because bagasse, babulwood and agro residues have lower ash content than that of Indian coal (30-40%) The project will meet all national and local environmental legislation. An Environmental Impact Assessment (EIA) will be done and the EIA approval shall be obtained. The project has received a consent to establish from the Maharashtra Pollution Control Board and an annual consent to operate will be obtained. The consent to operate will be made available to the DOE during verification. The project has obtained the following clearances: 1. Approval from Maharashtra Energy Development Agency 2. Consent to establish from MPCB 3. NOC from the Gram Panchayat 4. NOC from the Zilla Parishad 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: >> An Environmental Impact Assessment (EIA) will be conducted as per the requirements of the host country (India) and the approval will be obtained from the host party.

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SECTION E. Stakeholders comments >> E.1. >> Brief description how comments by local stakeholders have been invited and compiled: A newspaper advertisement has been published inviting comments from local people regarding the project. The notice was published in Dainik Janpravas on 17th November 2009 A local stakeholder review has been undertaken through the invitation of comments from local people and the local municipal board

A national stakeholder review is undertaken through the approval of the project by the DNA (Ministry of Environment and Forests). E.2. Summary of the comments received: >> To date no comments have been received. E.3. Report on how due account was taken of any comments received: >> Since no comments have been received, no action has been taken.

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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: Sinewave Biomass Power Pvt Ltd 94-B Maruti Krupa, Varshanagar Kolhapur Maharashtra 416012 India +91 22 66363308 +91 22 23809797 power@ambujaindia.com Director Mr Shah R Gambhirmal 9821028080

grshah@ambujaindia.com

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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:

Agrinergy Pte Ltd 10 Hoe Chiang Road #08-04 Keppel Towers Singapore 089315 Singapore +65 6592 0398 +65 6592 0401 www.agrinergy.com Director Mr Atkinson Ben +44 7960 970974 +65 6592 0401 +65 6592 0398 ben.atkinson@agrinergy.com

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Annex 2 INFORMATION REGARDING PUBLIC FUNDING The project has not received any public funding

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Annex 3 BASELINE INFORMATION

We have adopted the approach specified in the tool to calculate the emission factor for an electricity system to calculate the CO2 emission coefficient of the regional electricity grid. The operating margin for the years 2006-2007, 2007-2008, 2008-2009 is 1.01, 1.01, and 1.00 respectively. The value of the operating margin of the NEWNE grid as calculated by the CEA is 1.01 and the build margin is 0.685. This value of the combined margin is fixed ex-ante at 0.84 tCO2/MWh and is calculated as shown in the table below: tCO2/MWh 1.00 0.68 (1*0.5) + (0.68*0.5) = 0.84

Operating Margin Build Margin Combined Margin

http://www.cea.nic.in/planning/c%20and%20e/user_guide_ver5.pdf, Page 8

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Annex 4 MONITORING INFORMATION In addition to the measures for monitoring listed in section B.7.2 the following systems will be put in place to monitor the project activity. Complete documentation for the operation and maintenance of the power plant will be provided to the project owner at the time of commissioning by the Agrinergy Pte Ltd. Additional training on CDM data monitoring will be provided to the operators of the power plant. The monitoring of the project activity will be the responsibility of Sinewave Biomass Power Pvt Ltd. The monitored data will be reported to Agrinergy by the Plant Manager on a quarterly basis for the calculation and estimation of emission reductions. This data will be checked against initial estimates. If the project is not performing as expected, a report will be sent to Sinewave Biomass Power Pvt Ltd outlining where the project is deviating in its generation of emission reductions. The procedure for storage of records and performance documentation is as given below: o All data and records of data will be stored in electronic and paper format on site and will be maintained for the crediting period and two years thereafter. o All calibration reports will be stored in paper format on site and will be maintained for the crediting period and two years thereafter. The data quality will be ensured by the cross-check measures detailed below: o Electricity exported to the grid: the electricity exported will be metered both by electricity meters in the control room and by electricity meters located at the switchyard. Data from the meters in the control room will be recorded continuously. Data from the meters at switchyard will be recorded monthly by MSEB. In case there is a difference between the two records, MSEB records will prevail. o Average return trip distance: This will be cross checked with payments for transportation of the material. Measures to deal with possible monitoring data adjustment and missing data The following are the measures that shall be taken to account for missing or adjusted data: o Electricity export to the grid: In case both the data recorded by MSEB from the switchyard meters and the meters in the control room is missing, then the emission reductions for the corresponding period shall be set to zero. o Consumption of biomass fuels: In case the data pertaining to quantity of biomass fuels is missing, then the average GCV of the biomass fuel fired during the corresponding period for which data is available shall be used to arrive at the weight of biomass fuels fired depending on the power generation during the particular period. Procedure for conducting internal audit at Sinewave Biomass Power Pvt Ltd: An internal audit shall be carried out during the project verification and monitoring phase, at every 6 months interval but one of these will coincide with the verification. The plant O&M manager and the plant manager shall be responsible for conducting internal audits every 6 months from the start of commercial operation of the power plant. The following points shall be carried out as part of the internal audit procedures:

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1. Consolidation of quarterly data: The data recorded during the operation of the plant, shall be consolidated on a half-yearly basis by the plant manager. The number of ERs generated by the project activity shall be calculated and cross checked against the estimated ER as per the calculation sheet. Any difference arising in the ER generated and ER estimated shall be recorded and reasons for the increase or decrease in the actual number of ERs generated shall be identified and documented. 2. Random checking of data: The plant manager shall cross check the recorded data randomly. For e.g., the data for electricity generation and import recorded for a particular months may be cross checked against the MSEB bills for that particular month. 3. Record of necessary calibration certificates / government approvals: The plant manager shall ensure that the measurement meters shall be calibrated as required by the state regulatory authority. The records of such calibrations done shall be updated and stored. The necessary approvals from the statutory bodies shall be updated and records maintained. 4. Storage of data: The plant manager shall ensure that the data recorded on a monthly basis for energy generation, supply of biomass fuels shall be signed off by the individuals responsible for recording the respective data. 5. Data collection and storage procedures: The plant manager shall check that the CDM data is being collected and recorded as per the formats for data storage as provided during the validation of the project. On completion of the above steps, minutes of meeting shall be prepared and all individuals participating in the internal audit shall sign the minutes of meeting and the record shall be maintained for future reference. The organization will train the staff to ensure that the monitoring process is appropriate and effective. The CDM data will be collated monthly in an excel file maintained by the Plant Manager (a specific template will be provided by Agrinergy). A detailed monitoring report will be produced by the plant on a yearly basis. ---------

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