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

CDM – Executive Board

1

CLEAN DEVELOPMENT MECHANISM

PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD)

Version 03 - in effect as of: 22 December 2006

CONTENTS

A. General description of the small scale project activity

B. Application of a baseline and monitoring methodology

C. Duration of the project activity / crediting period

D. Environmental impacts

E. Stakeholders’ comments

Annexes

Annex 1: Contact information on participants in the proposed small scale project activity

Annex 2: Information regarding public funding

Annex 3: Baseline information

Annex 4: Monitoring Information



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SECTION A. General description of small-scale project activity

A.1 Title of the small-scale project activity:

>>

Waste heat recovery and utilization for power generation at DG Cement Khairpur Plant

Version 01

Date: 13/2/2012

A.2. Description of the small-scale project activity:

>>

DG Khan Cement Company Limited (DGKCC, hereafter referred to as DG Cement) is a leading

manufacturer of cement in Pakistan. It is part of Nishat Group which ranks among top five business

houses of Pakistan. DG Cement has two cement manufacturing plants, one in District Dera Ghazi Khan

and other at Khairpur, District Chakwal.

The waste heat recovery equipment will be installed on the 6700 tonnes per day (TPD) kiln of Khairpur

Plant. The kiln started its operation in March 2007.

At present, almost all the waste heat from the clinker production process at the DG Cement Khairpur

Plant is vented to atmosphere; only a small portion of waste heat is recovered for pre-heating of raw

inputs and drying of coal. DG Cement has a 36 MW grid electricity import connection. The cement

factory also has its own captive power plant having total installed capacity of 33 MW (it consists of two

Wartsila 18V50DF engines each having a capacity of 16.5 MW). These gen-sets were commissioned in

July 2007 and are designed to use Natural Gas (NG) as the main fuel; diesel is used as the pilot fuel

whereas Heavy Fuel Oil (HFO) is used as back up fuel. Power demand of the cement plant is met both by

the grid as well as an existing captive power plant.

The proposed project activity involves installation of Kalina cycle based waste heat recovery system

which includes three Heat Recovery Vapour Generators (HRVGs) having total capacity of 83tph (tonnes

per hour) and one vapour Turbo Generator (TG) having gross electricity generation capacity of 11 MW.

HRVGs shall be installed at Preheater (PH) and Air Quenched Cooler (AQC) ends of the kiln.

The project activity shall be commissioned in August 2012; net electricity generated by the project

activity (68,112 MWh/yr) will displace grid electricity imports and result in annual average emissions

reduction of 31,713 tonnes of CO2.

The project activity will also contribute towards sustainable development of the following:

Environmental Development

significant reduction in the emissions of Greenhouse Gases

improvement of the local environment by reduction in temperature of the vented hot air

conservation of local fossil fuel resources by avoiding fossil fuel based grid electricity

Social Development alleviation of poverty by providing labour employment opportunities to the local community

during construction phase



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creation of new permanent jobs during construction and operation phase

positive impact on local communities by avoiding grid electricity which will become available to

domestic consumers

addition to power generation capacity of Pakistan

less health impact for the population through less emission of greenhouse gases and particles

Economic Development

employment opportunities for the local people

Technology Development

introducing modern technology in the country (technology transfer)

setting up an example of sustainable development to be followed by other cement factories

A.3. Project participants:

>>

The table below illustrates the participants involved in the proposed CDM project activity. Contact

information is provided in Annex 1.

Table A.3.1: Project participants

Name of Party involved

((host) indicates a host Party)

Private and/or public

entity(ies)

project participants

(as applicable)

Kindly indicate if

the Party involved

wishes to be

considered as

project participant

(Yes/No)

Islamic Republic of Pakistan (host) D.G. Khan Cement Company

Limited (private entity) No

Islamic Republic of Pakistan (host) Carbon Services (Private)

Limited (private entity) No

Switzerland First Climate (Switzerland) AG

(private entity) No

A.4. Technical description of the small-scaleproject activity:

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

>>

Khairpur

A.4.1.1. Host Party (ies):

>>

Islamic Republic of Pakistan

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

>> Punjab



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A.4.1.3. City/Town/Community etc:

>>

The project is located at:

DG Cement Khairpur Plant

Khairpur village, Kallar Kahar, Chakwal District

The company is headquartered at:

Nishat House, 53 – A, Lawrence Road,

Lahore, Pakistan

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

unique identification of this small-scale project activity:

>>

D.G. Khan Cement Company Khairpur Plant is located in Kallar Kahar, District Chakwal; it is situated 22

km to the south of Chakwal and 2 km to the East of Khairpur village.

Exact location of the plant, with respect to its geographical coordinates, is:

Latitude: 32°43'42"

Longitude: 72°48'54"

The location of the project is illustrated in the figures below.

FigureA.4.1.4.1: Location of DG Cement Khairpur Plant



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Figure A.4.1.4.2: DGKCC Khairpur Plant

A.4.2. Type and category(ies) and technology/measure of the small-scale project activity:

>>

In accordance with Appendix B of the Simplified Modalities and Procedures for Small-Scale CDM

Project Activities, the project activity falls under the following type and category:

Type III: Other project activities

Category Q: Waste energy recovery (gas/heat/pressure) projects

Sectoral Scope 4: Manufacturing industries

Khairpur plant of DG Cement Limited has only one kiln of capacity 6700 TPD which was commissioned

in March 2007.The kiln is a Rotax 2 support kiln (length 66 meters, diameter 5.50 meters) which was

designed by F.L.Smidth Denmark.

In the baseline situation, almost all the waste heat from the clinker production process is vented to

atmosphere; only a small portion of waste heat is recovered for pre-heating of raw inputs and drying of

coal. DG Cement has a 36 MW grid electricity import connection. The cement factory also has its own

captive power plant having total installed capacity of 33 MW (it consists of two Wartsila 18V50DF

engines each having a capacity of 16.5 MW). These gen-sets were commissioned in July 2007 and are

designed to use Natural Gas (NG) as the main fuel; diesel is used as the pilot fuel whereas Heavy Fuel Oil

(HFO) is used as back up fuel. Power demand of the cement plant is met both by the grid as well as an

existing captive power plant.



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The proposed project activity involves installation of Kalina cycle based waste heat recovery system

which includes three Heat Recovery Vapour Generators (HRVGs) having total capacity of 83tph (tonnes

per hour) and one vapour Turbo Generator (TG) having gross electricity generation capacity of 11 MW.

Two Heat Recovery Vapour Generator units will be installed at the pre-heater ends of the kiln (one for

each pre-heater) and one Heat Recovery Vapour Generator unit will be installed at the cooler end of the

kiln. The vapours (ammonia-water vapour mix) will then be fed to the Turbo Generator.

The project activity uses Kalina cycle to recover the heat effectively from the low temperature gasses and

generate ammonia water vapours as working fluid. The system can vary the composition of the working

fluid throughout the power cycle, and utilize power plant system designs that achieve a high level of heat

recovery. This technology is more effective than the conventional Rankine cycle technology. The use of

this technology enables a substantial higher power output, due to a highly efficient heat transfer rate.

The Kalina cycle process uses a binary working fluid of ammonia and water with proprietary and

patented processes for varying the ammonia concentration throughout the system and for heat

recuperative stages for increased efficiency. The use of ammonia permits efficient use of waste heat

streams by causing boiling to start at lower temperatures. The use of a binary fluid allows the composition

of the working fluid to be varied through the use of distillation, providing a richer concentration through

the HRVGs and leaner composition in the low-pressure condenser. Since the molecular weight of

ammonia is close to that of water, a standard backpressure turbine is used with improved sealing

arrangements.

Ammonia is not harmful to the environment. It starts to boil at a lower temperature than water, and a

mixture of ammonia and water will boil over a varying temperature range, allowing the working fluid

temperature to more closely parallel to the heat source temperature. Therefore, it is possible to decrease

the flue gas outlet temperature to a lower value, i.e. increase in thermal utilization of the heat.

Additionally since the mixture has no static boiling point, the recovered efficiency is higher than that of a

Rankine cycle.

The project equipment is brand new and uses environmentally safe state of the art technology. It is the

world’s largest Kalina Cycle based power plant which is also first-of-its-kind waste heat recovery plant in

the cement industry of Pakistan, both in terms of technology as well as size of installation. The

technology will be transferred from Denmark. A list of major equipment of project activity is given below

in Table A.4.2.1.

Table A.4.2.1: Project equipment

Specifications of Heat Recovery Vapour Generators

Equipment Manufacturer Gross Vapour

Generation Flue Gas Temperature

HRVG 1

At PH end of kiln

FL Smidth Cumulative

83 tph

Inlet: 314 ºC

Outlet: 151 ºC

HRVG 2

At PH end of kiln

Inlet: 314 ºC

Outlet: 151 ºC

HRVG 3

At AQC end of kiln

Inlet: 307 ºC

Outlet: 138 ºC

Specification of Vapour Turbo-generator

Manufacturer FL Smidth

Type Backpressure

Rated power output 11 MW



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Net guaranteed power output 8.6 MW

Gross Vapour Available (Kg/Hr) at Turbine inlet 83,000

Turbine inlet temperature 289 ºC

Turbine inlet pressure 58 bar a

Turbine exhaust temperature 95 ºC

Turbine exhaust pressure 2.1 bar a

Operational characteristics of the turbo-generator are provided below in Table A.4.2.2

Table A.4.2.2: Operational characteristics of turbo-generator

Operational days per annum 330

Operational hours per day 24

Net Guaranteed electricity generation

(MWh/year) 8.6*330*24= 68,112

The project activity shall be commissioned in August 2012. The project technology is not likely to be

substituted by other or more efficient technologies within the crediting period of the project activity.

The net electricity generated by the project activity (68,112 MWh/yr) will partially displace fossil fuel

based grid electricity and will result in, on average 31,713tonnes of CO2 emissions reduction per annum.

Following is the schematic of project activity:

Figure A.4.2.1: Schematic of project activity

Clinker Production at Kiln

HR

VG

s

Vapour Turbo-Generator

Power Waste heat

Ammonia water

vapours

Distillation and Condensation Sub-

System

Ammonia water vapours

Cement Works

Raw Materials

Hot Exhaust for preheating incoming raw material



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A.4.3 Estimated amount of emission reductions over the chosen crediting period:

>>

The annual & total estimation of emission reductions for the fixed crediting period of 10 years (from

01/10/2012 to 30/09/2022) is provided below in Table A.4.3.1.

Table A.4.3.1: Emission reductions over the crediting period

Years Annual estimation of emission reductions in

tonnes of CO2 e

Year 1 31,713

Year 2 31,713

Year 3 31,713

Year 4 31,713

Year 5 31,713

Year 6 31,713

Year 7 31,713

Year 8 31,713

Year 9 31,713

Year 10 31,713

Total estimated reductions

(tonnes of CO2 e) 317,130

Total number of crediting years 10

Annual average over the crediting period of

estimated reductions (tonnes of CO2 e) 31,713

A.4.4 Public funding of the small-scale project activity:

>>

There is no public funding involved in the project activity.

A.4.5 Confirmation that the small-scale project activity is not a de-bundled component of

a large scale project activity:

>>

Appendix C of the Simplified Modalities and Procedures for Small-Scale CDM Project Activities defines the following rules to determine whether the small-scale project activity is a de-bundled

component of a large scale project activity or not:

“A proposed small-scale project activity shall be deemed to be a de-bundled 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:

(1) With the same project participants;

(2) In the same project category and technology/measure;

(3) Registered within the previous 2 years; and

(4) Whose project boundary is within 1 km of the project boundary of the proposed small-scale activity at

the closest point”

The project activity at DG Cement Khairpur Plant is not a de-bundled component of a large project

activity as in the last two years there is no registered small scale CDM project activity, or an application



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to register another small-scale CDM project activity by DG Cement in the same project category whose

project boundary lies within 1 km of the project boundary of the proposed small-scale project activity1.

SECTIOsN 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:

>>

AMS-III.Q: Waste Energy Recovery (gas/heat/pressure) Projects / Version 04

Valid from April 29, 2011

The methodology also refers to “ACM0012: Consolidated baseline methodology for GHG emission

reductions from waste energy recovery projects” for the estimation of the capping factor. Therefore,

corresponding section of ACM0012 / Version 04.0.0 (valid from April 15, 2011) is used.

Referred Tools:

Tool to calculate the emission factor for an electricity system (Version 02.2.1)

B.2 Justification of the choice of the project category:

>>

The present project activity involves waste heat recovery from cement manufacturing kiln. For the waste

heat from the kiln, AMS-III.Q is applicable. Here below the applicability conditions of the applied

methodology are checked.

Table B.2.1: Applicability check

Applicability Condition Applicability Check

1. The category is for project activities that utilize waste gas

and/or waste heat at existing facilities as an energy source for:

(a) Cogeneration; or

(b) Generation of electricity; or

(c) Direct use as process heat; or

(d) Generation of heat in elemental process (e.g. steam,

hot water, hot oil, hot air); or

(e) Generation of mechanical energy.

The project utilizes waste heat from

existing kiln as energy source for

generation of electricity (case b).

Condition is fulfilled.

2. The category is also applicable to project activities that use

waste pressure to generate electricity at existing facilities.

This condition is not relevant to the

project activity it does not involve

recovery of waste pressure for

generation of electricity.

3. The recovery of waste gas/heat/pressure should be a new

initiative (no waste gas/heat/pressure was recovered from the

project activity source prior to the implementation of the

project activity).

No waste heat was recovered for energy

generation purpose from the project

activity source prior to the

implementation of the project activity.

1 It may be pertinent to mention here that DG Cement has a registered small-scale project activity, DGKCC Waste

Heat Recovery and Utilization for 10.4 MW Power Generation at Dera Ghazi Khan Plant (refer # 4591) at its

Khofli Sattai Plant, which is in the same project category. However, the two plants of DG Cement (Khairpur and

Khofli Sattai) are separated by a distance of approximately 562 kms.



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So the project activity is a new

initiative.


4. Measures are limited to those that result in emission

reductions of less than or equal to 60 kt CO2 equivalent

annually.

The project activity results in emission

reductions of 31.713 kt CO2 equivalent

annually which is less than 60 kt CO2.


5. (a) The energy produced with the recovered waste

gas/heat/or waste pressure should be measurable;

The electricity produced by the project

activity is measurable.


5. (b) Energy generated in the project activity may be used

within the industrial facility or exported to other industrial

facilities (included in the project boundary);

The energy generated in the project

activity is used within the industrial

facility.


5. (c) Electricity generated in the project activity may be

exported to the grid or used for captive purposes; However, the

methodology is not applicable to projects where the waste

gas/heat/pressure recovery project is implemented in a single-

cycle power plant (e.g. gas turbine or diesel generator) where

heat (energy) generated on site is not utilizable for any other

purposes on-site except to generate power. Such project

activities shall consider AMS-III.AL “Conversion from single

cycle to combined cycle power generation”. The projects

recovering waste energy from such power plants for the

purpose of generation of heat only can apply this methodology;

The project activity does not

export any electricity to the grid.

The electricity generated in the

project activity would be used for

captive purposes only and would

displace electricity imports from

the grid.

The waste heat recovery project is

not implemented in a single cycle

power plant. The project activity

recovers waste heat from the

clinker production process and

utilizes it for power generation.


5. (d) For a project activity which recovers waste

gas/heat/pressure for power generation from multiple sources

(e.g. kiln and single-cycle power plant), this methodology can

be used in combination with AMS-III.AL provided that:

(i) Within the project activity it is possible to distinguish

two distinct waste energy sources such that:

• Waste energy source-I (e.g. kiln) belongs to such

waste heat sources which are eligible under AMS-

III.Q;

• Waste energy source-II (e.g. single-cycle power unit)

belongs to such waste heat sources which are eligible

under AMS-III.AL;

(ii) It is possible, for each waste energy source, to

determine the baseline according to the specific

methodology referred to;

(iii) It is possible to objectively allocate the electricity

produced in the project activity to each waste energy

source, by means of one of the following methods:

• Through separate measurements of the electricity

This condition is not relevant because

the project activity recovers waste heat

for power generation only from single

waste heat source i.e. kiln.



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produced by utilizing waste energy from each waste

energy source; or

• Through separate measurements of the energy content

of the waste energy carrying medium (WECM)

streams used for electricity production; or

• Through separate measurements of the energy content

of the waste energy streams that are associated with

each waste energy source and used for electricity

production or for the WECM generation in a common

waste heat recovery system (e.g. if steam is generated

by waste heat from a kiln and waste heat from an

internal combustion engine in a common waste heat

recovery boiler);

5. (e) The emission reductions are claimed by the generator of

energy using waste energy;

The emission reductions are claimed by

DGKCC, which is the generator of

energy using waste heat.


5. (f) In cases where the energy is exported to other facilities

(included in the project boundary), the following are required:

(i) All historical information from the recipient plants;

(ii) An official agreement exists between the owners of

the project energy generation plant (henceforth

referred to as generator, unless specified otherwise)

with the recipient plant(s) that the emission reductions

would not be claimed by the recipient plant(s) for

using a zero-emission energy source;

This condition is not relevant because

energy is not exported to other facilities

but used by the same facility where

waste energy is recovered.

5. (g) For those facilities and recipients included in the project

boundary, that prior to implementation of the project activity

(current situation) generated energy on-site (sources of energy

in the baseline), the credits can be claimed for minimum of the

following time periods:

(i) The remaining lifetime of equipments currently being

used; and

(ii) Crediting period;

The source of energy in the baseline is

the kiln which has a technical lifetime

that extends beyond the crediting

period. Therefore the credits are

claimed for the whole duration of the

selected crediting period (10 years).


5. (h) The waste gas/heat/pressure utilized in the project

activity would have been flared or released into the

atmosphere in the absence of the project activity. This shall be

proven by one of the following options:

(i) By direct measurements of energy content and

amount of the waste gas/heat/pressure for at least three

years prior to the start of the project activity;

(ii) Energy balance of relevant sections of the plant to

prove that the waste gas/heat/pressure was not a

source of energy before the implementation of the

project activity. For the energy balance the

representative process parameters are required. The

energy balance shall demonstrate that the waste

gas/heat/pressure was not used and also provide

conservative estimations of the energy content and

The waste heat utilized in the project

activity would have been released into

the atmosphere in absence of the project

activity. This is proven by using option

iii. Energy bills and annual financial

reports of the company, audited by a

competent third party, demonstrate that

all the energy required for the process

has been procured commercially




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amount of waste gas/heat/pressure released;

(iii) Energy bills (electricity, fossil fuel) to demonstrate

that all the energy required for the process (e.g. based

on specific energy consumption specified by the

manufacturer) has been procured commercially.

Project participants are required to demonstrate

through the financial documents (e.g. balance sheets,

profit and loss statement) that no energy was

generated by waste gas/heat/pressure and sold to other

facilities and/or the grid. The bills and financial

statements should be audited by competent authorities;

(iv) Process plant manufacturers’ original

specification/information, schemes and diagrams from

the construction of the facility could be used as an

estimate of quantity and energy content of waste

gas/heat/pressure produced for rated plant capacity per

unit of product produced.

6. For the purpose of this category waste energy is defined as: a

by-product gas/heat/pressure from machines and industrial

processes having potential to provide usable energy, for which

it can be demonstrated that it was wasted. For example gas

flared or released into the atmosphere, the heat or pressure not

recovered (therefore wasted). Gases that have intrinsic value in

a spot market as energy carrier or chemical (e.g., natural gas,

hydrogen, liquefied petroleum gas, or their substitutes) are not

eligible under this category.

The project activity utilizes waste

(heat) from clinker production process.

The waste heat was vented into the

atmosphere prior to the project activity.

The waste heat from the clinker

production process has no intrinsic

value in the spot market as energy

carrier or chemical. Thus this category

is applicable to waste heat from clinker

production process.


B.3. Description of the project boundary:

>>

The geographical extent of the project boundary includes the sites of the facility where:

waste heat is produced

waste heat is transformed into electricity

the transformed electricity is utilized

Therefore, the kiln where the waste heat is generated, the waste heat recovery system where it is

transformed into electrical energy and the plants within the facility where the generated electricity is

consumed delineates the project boundary.

The grid is not included in the project boundary as electricity generated by the project activity is not

exported to the grid. The project activity only displaces the electricity imported from the grid.

This is illustrated in Figure B.3.1.



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Figure B.3.1: Project boundary

B.4. Description of baseline and its development:

>>

In the baseline situation, the high temperature exhaust of the kiln is vented to the atmosphere; only a

small portion of the waste heat generated is recovered from the feed end of the kiln and is circulated for

preheating raw inputs and drying of coal. There are no potential alternatives of waste heat utilization in

the vicinity of the factory.

DGKCC receives electricity from two sources, grid and captive power plant. However, grid supply in

Pakistan is not reliable; therefore the captive power plant is used as base load, and does not modify its

regime once the project activity is in place. Table B.4.1 given below shows that share of grid electricity is

fluctuating every year due to its unreliability. Therefore, the electricity produced by the project activity

only displaces grid electricity. This is also toward conservativeness as the grid electricity emission factor,

0.4656 tCO2/MWh, is lower than the captive power plant emission factor, 0.4703 tCO2/MWh2.

Table B.4.1: Historical data

Year

2007/08

Year

2008/09

Year

2009/10 Average

Clinker production by kiln (t/yr) 1,861,663 1,945,962 2,404,629 2,070,751

Electricity imported from grid (MWh/yr) 55,738 40,570 80,207 58,838

Electricity generated by captive power 130,689 148,129 146,406 141,741

2 Calculations for emission factors of grid and captive power plant are done in separate spread sheets, details are also

provided in Annex 3.

6700 TPD Kiln

WASTE HEAT RECOVERY

Cem

ent

Wo

rks

Waste Heat

8.6 MW Project

electricity

Grid electricity

Project Boundary

National Grid



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plant (MWh/yr)

Total electricity consumption (MWh/yr) 186,427 188,699 226,613 200,580

Share of grid electricity (%/yr) 30% 21% 35% 29%

Share of captive generation (%/yr) 70% 79% 65% 71%

Hence continuation of the current practice, venting the waste heat from kiln into the atmosphere and

supply of electricity from the national grid, is the most plausible baseline scenario in absence of the

proposed CDM project activity.

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:

>>

Prior CDM Consideration and continued effort to secure CDM status

The starting date of the project activity is the October 30, 2010 which corresponds to the date of signing

contract between DGKCC and F.L.Smidth A/S. of Denmark. DGKCC was aware of CDM since June

2007 and it played an instrumental role in the investment decision taken on the August 10, 2010 to

implement the proposed CDM project activity. Discussions with CDM consultants started in June 2007

with Factor Consulting (later First Climate (Switzerland) AG) and Carbon Services (Private) Limited.

During the whole implementation phase before validation, DGKCC was accompanied by the CDM

consultants. Project timeline is given below in Table B.5.1

Table B.5.1: Project Timeline

Milestone Date Source

CDM Awareness June 2007

Email communication

between Carbon Services and

DGKCC

Investment Decision August 10, 2010 Project Approval

Documentation

Project Start Date October 30, 2010 Contract between project

proponent and contractor

Prior CDM Consideration

Notification sent to UNFCCC and

DNA Pakistan

January 19, 2011 E-mail sent to UNFCCC and

DNA

Start of civil works March 25, 2011 Company Information

Request for validation sent to DOE September 29, 2011 E-mail sent to DOE

Environmental Approval of the

Project Activity January 10, 2012

Environmental Approval

Letter provided by by

Environmental Protection

Department, Punjab

Validation Contract signed with DOE January 20, 2012 Validation Contract

Expected project commissioning August 2012 Gantt chart in contract

document

Assessment and demonstration of additionality

According to Attachment A to Appendix B of the Simplified Modalities and Procedures for Small-

Scale CDM Project Activity, "Project participants shall provide an explanation to show that the project



15

activity would not have occurred anyway due to at least one of the following barriers: (a) Investment

barriers, (b) Technological barriers, (c) Barrier due to prevailing practice and (d) other barriers.”

The barrier chosen to demonstrate additionality is the prevailing practice barrier option (c). Analysis of

the prevailing practice barrier is provided below

Barrier due to prevailing practice

The project activity is the first-of-its-kind in Pakistan both in terms of its technology as well as size of

installation; the project activity uses Kalina cycle based waste heat recovery system for power generation

which has never been used before in the cement industry of Pakistan3; secondly, as confirmed by the

technology supplier, FLSmidth, this Kalina Cycle based waste heat recovery power plant is the largest

installation in the world4.

Furthermore, the project participants have chosen a fixed crediting period of 10 years with no option of

renewal.

The project activity is additional as it fulfils the conditions as specified in paragraph 5 of the

GUIDELINES ON ADDITIONALITY OF FIRST-OF-ITS-KIND PROJECT ACTIVITIES, Version 01.0

(EB 63, Annex 11):

“A proposed project activity is the First-of-its-kind in the applicable geographical area if :

(a) The project is the first in the applicable geographical area that applies a technology that is different

from any other technologies able to deliver the same output and that have started commercial operation

in the applicable geographical area before the start date of the project; and

(b) Project participants selected a crediting period for the project activity that is “a maximum of 10

years with no option of renewal”

In view of the analysis provided above it can be concluded that the proposed CDM project activity is fully

additional.

3 First of its kind confirmation letter provided by All Pakistan Cement Manufacturers Association (APCMA)

4 Press release by FLSmidth available at

http://www.flsmidth.com/en-US/News+and+Press/Company+Announcements?feeditem=1524510

http://www.flsmidth.com/en-US/News+and+Press/Company+Announcements?feeditem=1524510



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B.6. Emission reductions:

B.6.1. Explanation of methodological choices:

>>

The emission reductions of the project activity have been calculated according to AMS-III.Q (Version

04).

Baseline emissions

As the electricity is obtained from a specific existing power plant and from the grid, baseline emissions

can be calculated as follows:

j i

yjiElecyjiwcmcapyelec EFEGffBE )*(** ,,,,,, (1)

Where:

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

CO2

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

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

either grid or identified source) during the year y in MWh

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

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

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

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

If the boiler providing steam for electricity generation uses both waste and fossil

fuels, this factor is estimated using equation (7). If the steam used for generation

of the electricity is produced in dedicated boilers but supplied through common

header, this factor is estimated using equation (7)/(9).

Note: For project activity using waste pressure to generate electricity, electricity

generated from waste pressure use should be measurable and this fraction is 1

fcap Capping factor to exclude increased waste energy utilization in the project year y

due to increased level of activity of the plant, relative to the level of activity in the

base years before project start. The ratio is 1 if the waste energy generated in

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

fcap shall be estimated according to the corresponding section of ACM0012

“Consolidated baseline methodology for GHG emission reductions from waste

energy recover projects”

Emission Factor of Grid



17

The baseline generation source is grid, the parameter EGi,j,y corresponds to EGgr,y and the emission factor

EFelec,i,j,y corresponds to EFElec,gr,y. The CO2 emission factor is determined ex ante as per “Tool to

calculate the emission factor for an electricity system” (Version 02.2.1) and fixed for entire crediting

period. The calculation is done in a separate excel spread sheet and the details are provided in Annex 3.

Calculation of fwcm

The electricity generation of the project is purely from use of waste heat, then according to the

methodology fwcm= 1.

Calculation of fcap

According to the requirements of AMS.III.Q (Version 04) the capping factor fcap should be calculated

using proper equations from ACM0012 “Consolidated baseline methodology for GHG emission

reductions from waste energy recover projects”

As an introduction to the element of conservativeness, this methodology requires that baseline emissions

should be capped irrespective of planned/unplanned or actual increase in output of plant, change in

operational parameters and practices, change in fuel type and quantity resulting in an increase in

generation of waste energy. In case of planned expansion a separate CDM project should be registered

for additional capacity. The cap can be estimated using the three Methods described below. Project

proponents shall use Method-1 to estimate the cap if data is available. In case of project activities

implemented in a new facility, or in facilities where three-year data on production is unavailable,

Method-2 shall be used. In case the project proponents demonstrate technical limitations in direct

monitoring of waste heat / pressure of waste energy carrying medium (WECM), then Method-3 is used.

Method-1

Where the historical data on energy released by the waste energy carrying medium is available, the

baseline emissions are capped at the maximum quantity of waste energy released into the atmosphere

under normal operation conditions in the three years previous to the project activity.

Method-2

The manufacturer’s data for the industrial facility shall be used to estimate the amount of waste energy

the industrial facility generates per unit of product generated by the process that generates waste energy

(either product of departmental process or product of entire plant, whichever is more justifiable and

accurate). In case any modification is carried out by the project proponent or in case the manufacturer’s

data is not available for an assessment, this should be carried out by independent qualified/certified

external process experts such as a chartered engineer on a conservative quantity of waste energy

generated by plant per unit of product manufactured by the process generating waste energy. The value

arrived based on above sources of data, shall be used to estimate the baseline cap (fcap). The

documentation of such assessment shall be verified by the validating DOE.

Method-3

In some cases, it may not be possible to measure the waste energy (heat, sensible heat, heat of reaction,

heat of combustion etc.), enthalpy or pressure content of WECM. Therefore there is no historic data

available for these cases. These cases may be of following two types.



18

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

recovery equipment. For example, the useful energy (e.g., steam) is produced using waste energy

generated by a chemical reaction. For such cases fcap should be the ratio of maximum energy that could

be recovered (MER) by the waste heat recovery equipment implemented under the CDM project activity

and the actual energy recovered under the project activity (using direct measurement). The MER should

be based on information on the characteristics of the key product/by product. For existing facilities this

can be obtained from historical information and for Greenfield facilities, manufacturer’s specifications

on these key parameters can be used.

Case 2: The energy is recovered from WECM in intermediate energy recovery equipment using an

intermediate source. For example, an intermediate source to carry energy from primary WECM may

include the sources such as water, oil or air to extract waste energy entrapped in chemicals (heat of

reaction) or solids (sensible heat), which is further recovered in the waste heat recovery equipment to

generate final output energy. For such cases fcap should be the ratio of maximum energy that could be

recovered (MER) by waste heat recovery equipment implemented under the CDM project activity

(considering the losses due to exchange of energy) and actual intermediate energy recovered under the

project activity (using direct measurement). The MER should be based on information on the

characteristics of the key product/by product. For existing facilities this can be collected from historical

information and for Greenfield facilities, manufacturer’s specifications on these key parameters can be

used.

Since there is no historical data on parameters of the waste energy from the cement clinker production

and it is not possible to measure it due to different technical reasons, Method-3 for fcap calculation was

chosen.

As there are heat exchangers in the project scenario where waste energy is transferred from WECM to

ammonia-water mix for vapours generation and further production of electricity, therefore Case 1 of

Method-3 for fcap calculation is used.

Therefore, fcap is determined using Equation (40) of ACM0012 / Version 04.0.0 :

yOE

BLOE

capQ

Qf

,

, (2)

Where:

QOE,BL = Output/intermediate energy that can be produced (TJ), to be determined on the basis of

maximum energy that could be recovered from the WECM (MER), which would have

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

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

QOE,y = Quantity of actual output/intermediate energy generated during year y (TJ)

In the proposed project, the theoretical electricity output BLOEQ , is 68,112 MWh/year i.e. (68,112 * 3.6 *

10-3

= 245.203 TJ electrical). The actual output electricity yOEQ , will be determined ex post by actual

measurement. As per project plan, there is no reason to believe that the energy recovered will be different

from the theoretical value for which the waste heat recovery system has been designed. Therefore, the

ratio is assumed to be 1 for ex ante calculations and will be settled ex post.



19

fcap = 1

Project emissions

Project Emissions include emissions due to combustion of auxiliary fuel to supplement waste gas and

emissions due to consumption of electricity by the project activity.

If the waste gas contains carbon monoxide or hydrocarbons, other than methane, and the waste gas is

vented to the atmosphere in the baseline situation, project emissions have to include CO2 emissions due to

the combustion of the waste gas.

There is no auxiliary fuel combustion in the project activity to supplement waste gas and the turbo-

genset consumes its own electricity for auxiliary needs. Similarly, the project activity does not incinerate

any waste gas to generate energy. Therefore, the project emissions are considered zero.

Leakage Emissions

If equipment currently being utilised is transferred from outside the boundary to the project activity,

leakage is to be considered.

Leakage is conserved to be zero as the project activity only involves installation of new equipment and

there is no transfer of equipment from outside the project boundary to the project activity.

Emission reductions

Emission reductions are calculated as follows:

yyyy LEPEBEER (3)

Where:

yER Emission reductions in year y (t CO2e/yr)

yBE Baseline emissions in year y (t CO2e/yr)

yPE Project emissions in year y (t CO2/yr)

yLE Leakage emissions in year y (t CO2/yr)



20

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

Data / Parameter: QOE,BL

Data unit: TJ/yr

Description: Output electricity that can be theoretically produced, to be determined on the

basis of maximum recoverable energy.

Source of data to be

used: Equipment Specifications

Value of data 245.203

Description of

measurement methods

and procedures to be

applied:

The value is calculated by converting 68,112 MWh/yr (i.e. calculated on the basis

of 8.6 MW net value) to TJ by multiplying with 3.6*10-3

QA/QC procedures to

be applied:

Any comment:

Data / Parameter: fcap

Data unit: %

Description: Capping factor to exclude increased waste energy utilization in the project year

y due to increased level of activity of the plant, relative to the level of activity in

the base years before project start. The ratio is 1 if the waste energy generated

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

Source of data used: Chosen according to Case 1 of Method -3 as specified in ACM 0012

Value applied: 100

Justification of the

choice of data or

description of

measurement methods

and procedures actually

applied :

fcap= 1 or 100%, calculated as per the procedure as mentioned in Case 1 of

Method -3 as specified in ACM 0012

Any comment:

Data / Parameter: fwcm

Data unit: %

Description: Fraction of total energy generated by the project activity using waste energy.

This fraction is 1 if the energy generation is purely from use of waste energy in

the project generation unit.

Source of data used: Technical Description Document of the Waste Heat Recovery Equipment

Value applied: 100


choice of data or

description of

measurement methods


applied :

The electricity generation of the project is purely from use of waste heat, then

according to the methodology fwcm= 1 or 100%.



21

Any comment:

Data / Parameter: COEFHFO

Data unit: tCO2/TJ

Description: Emission Coefficient of HFO

Source of data used: Table 2.3 “Default Emission Factors for Stationary Combustion in

Manufacturing Industries and Construction”, Chapter 2: Stationary Combustion,

2006 IPCC Guidelines for National Greenhouse Gas Inventories

Value applied: 77.4


choice of data or

description of

measurement methods


applied :

Given that local value is not available, IPCC default value is used

Any comment: Used to calculate the grid emission factor EFgrid (see details in Annex 3)

Data / Parameter: COEFdiesel

Data unit: tCO2/TJ

Description: Emission Coefficient of diesel




Value applied: 74.1


choice of data or

description of

measurement methods


applied :



Data / Parameter: COEFcoal

Data unit: tCO2/TJ

Description: Emission Coefficient of coal




Value applied: 96.1


choice of data or

description of

measurement methods


applied :



Data / Parameter: COEFNG



22

Data unit: tCO2/TJ

Description: Emission Coefficient of Natural Gas




Value applied: 56.1


choice of data or

description of

measurement methods


applied :



Data / Parameter: NCVHFO

Data unit: TJ/t

Description: Net Calorific Value of HFO

Source of data used: Table in appendix 7.4 of Pakistan Energy Year Book 2010

Value applied: 0.04077


choice of data or

description of

measurement methods


applied :

Public available source for the grid emission factor calculation


Data / Parameter: NCVDiesel

Data unit: TJ/t

Description: Net Calorific Value of diesel




choice of data or

description of

measurement methods


applied :



Data / Parameter: NCVCoal

Data unit: TJ/t

Description: Net Calorific Value of coal

Source of data used: Table M-1 in appendix of WAPDA statistics



choice of data or

description of




23

measurement methods


applied :


Data / Parameter: NCVNatural Gas

Data unit: TJ/MMCFT (tera joule per million cubic feet)

Description: Net Calorific Value of natural gas




choice of data or

description of

measurement methods


applied :



Data / Parameter: FCHFO

Data unit: ton

Description: Annual consumption of HFO

Source of data used: Pakistan Energy Year Book 2010

Value applied:

2007-08 2008-09 2009-10

6,923,707 7,405,059 8,564,578


choice of data or

description of

measurement methods


applied :



Data / Parameter: FCDiesel

Data unit: ton

Description: Annual consumption of diesel


Value applied: 2007-08 2008-09 2009-10

160,226 165,359 249,248


choice of data or

description of

measurement methods


applied :



Data / Parameter: FCCoal



24

Data unit: ton

Description: Annual consumption of coal


Value applied: 2007-08 2008-09 2009-10

162,200 112,520 125,482


choice of data or

description of

measurement methods


applied :



Data / Parameter: FCNatural Gas

Data unit: MMCFT (million cubic feet)

Description: Annual consumption of NG


Value applied: 2007-08 2008-09 2009-10

429,892 404,140 366,906


choice of data or

description of

measurement methods


applied :



Data / Parameter: EGHFO

Data unit: GWh

Description: Annual gross electricity generated on HFO


Value applied: 2007-08 2008-09 2009-10

30,169 31,749 35,170


choice of data or

description of

measurement methods


applied :



Data / Parameter: EGdiesel

Data unit: GWh

Description: Annual gross electricity generated on diesel


Value applied: 2007-08 2008-09 2009-10

649 674 1005


choice of data or




25

description of

measurement methods


applied :


Data / Parameter: EGcoal

Data unit: GWh

Description: Annual gross electricity generated on coal


Value applied: 2007-08 2008-09 2009-10

136 113 116


choice of data or

description of

measurement methods


applied :



Data / Parameter: EGNatural Gas

Data unit: GWh

Description: Annual gross electricity generated on NG


Value applied: 2007-08 2008-09 2009-10

32,923 29,678 28,079


choice of data or

description of

measurement methods


applied :



Data / Parameter: EGnuc

Data unit: GWh

Description: Annual gross electricity generated by nuclear plants


Value applied: 2007-08 2008-09 2009-10

3,077 1,618 2,894


choice of data or

description of

measurement methods


applied :





26

Data / Parameter: EGhydro

Data unit: GWh

Description: Annual gross electricity generated by hydro plants


Value applied: 2007-08 2008-09 2009-10

28,707 27,784 28,093


choice of data or

description of

measurement methods


applied :



Data / Parameter: ECnuc

Data unit: GWh

Description: Annual auxiliary electricity consumption by nuclear plants


Value applied: 2007-08 2008-09 2009-10

258 143 231


choice of data or

description of

measurement methods


applied :



Data / Parameter: EChydro

Data unit: GWh

Description: Annual auxiliary electricity consumption by hydro plants


Value applied: 2007-08 2008-09 2009-10

86 84 87


choice of data or

description of

measurement methods


applied :



Data / Parameter: ECthermal

Data unit: GWh

Description: Annual auxiliary electricity consumption by thermal power plants


Value applied: 2007-08 2008-09 2009-10

3,343 1,840 1,942

Justification of the Public available source for the grid emission factor calculation



27

choice of data or

description of

measurement methods


applied :


Data / Parameter: EI

Data unit: GWh

Description: Annual net imports from other grids outside the host country


Value applied: 2007-08 2008-09 2009-10

199 227 249


choice of data or

description of

measurement methods


applied :



Data / Parameter: EFGrid

Data unit: tCO2/MWh

Description: Emission factor of the grid




choice of data or

description of

measurement methods


applied :

Calculated as per “Tool to calculate the emission factor for an electricity system

/ Version 02.2.1”

Any comment: The detailed calculation of the grid emission factor is provided in Annex 3. The

grid emission factor is calculated ex-ante and fixed for the entire crediting

period of the project activity.

Data / Parameter: EGChistorical

Data unit: MWh/yr (Mega watt hours per year)

Description: Electricity generated by captive power plant in historical year

Source of data used: Historical data provided by DGKCC

Value applied: 2007/08 2008/09 2009/10

130,689 148,129 146,406


choice of data or

description of

measurement methods

The data has been taken from power generation reports of DGKCC, QMS

procedures are followed in measurement and reporting this value.



28


applied :

Any comment:

Data / Parameter: EIGhistorical

Data unit: MWh/yr (Mega watt hours per year)

Description: Electricity imported from grid in historical year

Source of data used: Historical data provided by DGKCC

Value applied: 2007/08 2008/09 2009/10

55,738 40,570 80,207


choice of data or

description of

measurement methods


applied :

The data has been taken from electricity consumption reports of DGKCC, QMS

procedures are followed in measurement and reporting this value.

Any comment:

B.6.3 Ex-ante calculation of emission reductions:

The equations involved in ex-ante calculations are enumerated in section B.6.1. Detailed emission

reduction calculations are provided in a separate EXCEL sheet.

Baseline emissions

Baseline emissions are calculated as:

j i

yjiElecyjiwcmcapyelec EFEGffBE )*(** ,,,,,, (1)

= 1*1*68,112*0.4656

= 31,713 tCO2 / yr

Following equation is used to determine fcap:

yOE

BLOE

capQ

Qf

,

, (2)

= 245.203 / 245.203

= 1



29

Project emissions

There is no auxiliary fuel combusted in the project activity to supplement waste gas and the waste heat

recovery system consumes its own electricity for auxiliary needs. Similarly, the project activity does not

incinerate any waste gas to generate energy. Therefore, the project emissions are considered zero.

0yPE

Leakage

Leakage is conserved to be zero as the project activity only involves installation of new equipment and

there is no transfer of equipment from outside the project boundary to the project activity.

0yLE

Emission reductions

Emission reductions are calculated as follows:

yyyy LEPEBEER (5)

= 31,713 – 0 – 0

= 31,713 t CO2 / yr

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

>>

A summary of the ex-ante estimation of emission reductions for the fixed crediting period of 10 years

(from 01/10/2012 to 30/09/2022) is provided below.

Table B.6.4.1: Ex-ante estimation of emission reductions

Year

Estimation of

project activity

emissions

(tonnes of CO2 e)

Estimation of

baseline

emissions

(tonnes of CO2 e)

Estimation of

leakage

(tonnes of CO2 e)

Estimation of

overall emission

reductions

(tonnes of CO2 e)

Year 1 0 31,713 0 31,713

Year 2 0 31,713 0 31,713

Year 3 0 31,713 0 31,713

Year 4 0 31,713 0 31,713

Year 5 0 31,713 0 31,713

Year 6 0 31,713 0 31,713

Year 7 0 31,713 0 31,713

Year 8 0 31,713 0 31,713

Year 9 0 31,713 0 31,713

Year 10 0 31,713 0 31,713

Total

(tonnes of CO2 e) 0 317,130 0 317,130



30

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

Data / Parameter: EGi,j,y

Data unit: MWh

Description: Net electricity generated by waste heat recovery based turbo-generator


used: Internal records

Value of data applied

for the purpose of

calculating expected

emission reductions in

section B.5

68,112

Description of

measurement methods


applied:

Measuring Equipment: Energy Meter

Data type: Measured

Frequency of measurement: Monthly

QA/QC procedures to

be applied: QMS procedures will be followed in recording & reporting of parameter.

Any comment:

Data / Parameter: QOE,y

Data unit: TJ

Description: Electrical output generated by waste heat recovery based turbo-generator during

year y


used: Electricity generation report

Value of data 245.203

Description of

measurement methods


applied:

Calculated (By converting MWh to TJ by multiplying with 3.6*10-3

)

QA/QC procedures to

be applied:

Any comment:

B.7.2 Description of the monitoring plan:

>>

Monitoring plan involves metering the electrical energy produced by the project activity. Based on that,

fcap will be determined according to Case 1: method 3 of ACM0012 as illustrated in section B.6.1 of the

PDD.

Data for electricity consumption by plant is collected by electrical supervisor, and ECS plant guide

software. Electrical Managers verify the data for electricity consumption.



31

Power house data is collected by Power House Operators; who record the data for electricity generation

and fuel consumption at the power plant. Daily power generation report is prepared by Power House Shift

Engineers which are later verified by Incharge Power House/Power House Manager.

QMS (Quality Management System) shall be followed in reporting and recording of all the monitoring

parameters described in Section B.7.1. In case some data is missing or incorrect, it will be reconstructed

or rectified based on the information sought from the historical data record which is similar in terms of

operating conditions and parameters. An electronic spread sheet model will be used for archiving

electronic data.

The person in charge of the project monitoring will conduct annual internal audits, checking the above

mentioned procedures for collecting data.

The person in charge of quality assurance would make sure that all the equipment used for measuring data

are properly and timely calibrated. Each equipment/meter should have a calibration tag attached to it

showing equipment name, model, date of last calibration and the date when next calibration is due. To

ensure the reliability of the data, calibration of all measuring devices would be done according to a

planned calibration.

Table B.7.2.1 shows the responsibilities of personnel monitoring the operation of proposed CDM activity.

Table B7.2.1: Designation of Personnel Involved in Monitoring

Parameter Data

Collection

Daily Data

Log

Preparation

Initial Data

Verification

Final Data

Verification

Data Auditing

Designation Frequency

Electricity

Generation Operator Shift Engineer Incharge Manager

Internal

Auditors Annual

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

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

>>

Date of completion: 13/02/2012

Name of the responsible entities: First Climate (Switzerland) AG

Stauffacherstrasse 45

CH-8004 Zurich

Switzerland

URL: www.firstclimate.com

Contact person: Mr.NikolausWohlgemuth

Email: [email protected]

Carbon Services (Private) Limited

19 Davis Road, 2nd

Floor, Al Maalik,

Lahore

Pakistan

URL: www.carbon.com.pk

Contact person: Mr. Omar M Malik

Email: [email protected]

Both, First Climate (Switzerland) AG and Carbon Services (Private) Limited, are project participants.

http://www.firstclimate.com/

mailto:[email protected]

http://www.carbon.com.pk/




32

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:

>>

Starting date of the project activity is October 30, 2010 which is the date of signing contract between

DGKCC and FLSmidth A/S.

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

>>

20 years 0 months

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

C.2.1. Renewable crediting period

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

>>

Not applicable

C.2.1.2. Length of the first crediting period:

>>

Not applicable

C.2.2. Fixed crediting period:

C.2.2.1. Starting date:

>>

01/10/2012

C.2.2.2. Length:

>>

10 years 0 months



33

SECTION D. Environmental impacts

>>

D.1. If required by the host Party, documentation on the analysis of the environmental impacts

of the project activity:

>>

According to the host country regulations, the project activity had to receive an Environmental Approval

from the Environment Protection Department of the local government, upon submission of an Initial

Environmental Examination (IEE) Report by the project proponent.

The IEE points out that the project will be beneficial to the environment as utilization of waste heat and

thus avoiding fossil fuel based grid electricity are made possible by the new technology. No negative

environmental impacts are to be considered, as the technology to be adopted is mature and safe, once

appropriate operation and maintenance procedure are in place.

The environmental analyses conducted by DGKCC for the project are consistent in demonstrating that the

project activity is expected to remain fully compliant with NEQS (National Environmental Quality

Standards). In fact, it is expected that pollutant emissions (both of local concern and global concern, such

as CO2) will reduce from the current levels.

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:

>>

Neither the project participants nor the host Party have any concern about negative environmental impacts

associated with the project activity, given that project activity aims at reducing the local and global

environmental impacts of the industrial site where the project activity is to be implemented.

IEE Report (Initial Environmental Examination Report) and the accompanying approval request letter

were submitted on July 18, 2011. The environmental approval to the project activity was granted on

January 10, 2012.The I.E.E report does not raise any particular issue with regard to the environmental

impact of the project.

SECTION E. Stakeholders’ comments

>>

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

>>

The local stakeholders’ consultation meeting is a requirement by Designated National Authority (DNA)

of CDM Pakistan, as well as it is required for the CDM PDD. The DNA issues Host Country Approval to

the project participants after the stakeholders’ consultation meeting is conducted and all the evidences are

provided to it.

Stakeholders were informed about the project activity through specific advertising published by the

project owner in the local media (newspaper, public notice boards within and surrounding the DG Cement

Khairpur Plant).



34

The Stakeholder consultation meeting was held on Jan 28, 2011 at DG Cement Khairpur Plant and was

open to anybody willing to participate (private citizens, representatives of associations, interest groups,

unions, public authorities, NGOs etc.).

The meeting was introduced by the representative of the project owner who explained in details the

project activity and stimulated the debate and the expression of comments.

E.2. Summary of the comments received:

>>

Comments from the stakeholders were collected in written form during and after the meeting. These are

summarized below Table E.2.1.

Table E.2.1: Summary of the comments

Sr. No. Stakeholder’s

Name Designation Qualification Address

Comments/Views about the

Project

1. Ghulam Shabbir Teaching M.A (English)

(Urdu)

G.H.S.S

Kallar Kahar

Waste heat recovery

project will help to

minimise environmental

pollution.

It will be useful for the

environmental conditions

global warming and green-

house effects.

By storing heat it will

produce electricity.

It will also help to

overcome the problems of

unemployment

2.

Capt.

Muhammad Gul

Malik

Rtd. Capt from

Artillery F.A

Khairpur

Kalar Kahar

Chakwal

I am so grateful to all senior

persons to invite us in this

briefing.

I cannot tell my personal

opinion about this project but I

can say that there are very few

people who have good thinking

about improvement of

Pakistan’s economy. This

project will give great oxygen

to not only D.G. Cement but

also to Pakistanis. I am again

grateful to Mian Mansha and

his great son for good thinking.

3.

Mian

Muhammad

Riaz Khan

F.Sc.

Khairpur

District

Chakwal

After hearing the briefing of

Mr. Khalid I have come to

know that Mansha Group is

trying to generate electricity by

recovering the waste heat. May

God create more people like

these which help country’s

progress

4. Amjad Hussain Teaching M.A G.H.S.S

Kallar Kahar

The waste heat recovery clean

development project is very



35

useful for local environment.

Our country is facing energy

crises this project will help to

improve production of

electricity and also reduce the

pollution

5. Malik Nasir

Ahmad S.S.T Teacher M.A/M.Ed

Government

Higher

secondary

School Kallar

Kahar

No doubt it is a good project. In

future this project will produce

significant electricity and use

gases which produce pollution.

Due to production of electricity

we will come to control the

load shedding in this particular

area and in our country.

6. Muhammad

Zariat Retired Teacher

B.A/B.Ed-

M.A/M.Ed

Village P.O:

Daulat pur

Tehsil,

P.D.Khan

District

Jehlum

After the briefing of G.M, I am

impressed with it. It is modern

development. It is our

requirement in these difficult

circumstances. In the end I

appreciate this modern

development.

7. Imiaz Ahmad Shopkeeper Matric

Tehsil and

District

Chakwal

With this project activity

impact on the environment are

very positive, jobs will be

created and country will benefit

from it.

8. WajidHussain Land Surveyor F.A

P.O Minhal,

Tehsil Choa

Saiden Shah

District

Chakwal

Waste heat recovery project is

better for environment. We are

happy with this project and we

want this project to complete as

soon as possible. Because it is

better for electricity. It is also

better for unemployed persons.

9. Muhammad

Hanif Labour Primary

Environment will be improved

with the installation of this

project. This project will create

jobs and electricity.

Government will benefit from

it. I am in full favour of this

plant.

10. Hafiz M Akhtar Matric Chak Khushi,

Kallar Kahar

D.G Cement plant is very

benefiting for us e.g. Jobs,

hospital etc. With the

installation of heat recovery

plant environment will be

better, electricity will be

generated, job opportunities

will be created and area will

prosper.

11. Talat Amir F.A

Kallar Kahar

P.O Kallar

Kahar

I totally agree with the project

activity of D.G Cement factory.

12. Mazhar Agriculturist Matric Village Dolat With the installation of heat



36

pur, Tehsil

Pind dadan

khan, District

Jehlum

recovery plant environment will

be better, job opportunities will

create and deficiency of

electricity will be reduced.

13. Noor Ahmad Shopkeeper Metric

Kallar Khahar

District Khair

pur, Chakwal

I am in full favour of this

project activity at the D.G Khan

cement factory. With the

installation of heat recovery

plant electricity will be

generated and environment will

be better and also job

opportunities will be created.

14. Malik Iftikhar

Ahmad

Principal

G.H.S.S Kallar

Kahar

M.A Political

Science

Government

Higher

Secondary

School, Kallar

Khar

It is a good project because it

will benefit the local

community. D.G Cement has

already doing well in the

welfare programs in health and

education sector. When

electricity will be generated

from the waste heat the

environment will be cleaner.

15.

Malik

Muhammad

Waseem

Students D.A.E

(Electronics)

District

Chakwal

Waste heat recovery

project will help to

minimise environmental

pollution.

It will be useful in reducing

global warming.

By heat recovery electricity

will be generated.

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

>>

All the comments received at the stakeholders meeting were expressing a positive opinion of the project.

The personnel at DGKCC explained in detail the technical, environmental, and social consequences of

utilization of waste heat recovery for power generation. The stakeholders were satisfied, and were

supportive to the project. In conclusion, no concerns were expressed by the stakeholders, which

eventually expressed appreciation for initiative of DGKCC.



37

Annex 1

CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY

Organization: D.G. Khan Cement Company Limited

Street/P.O.Box: 53 – A, Lawrence Road

Building: Nishat House

City: Lahore

State/Region: Punjab

Postfix/ZIP:

Country: Pakistan

Telephone: +92 42 111 11 33 33

FAX: +92 42 6367414

E-Mail:

URL: www.dgcement.com

Represented by:

Title: Chief Executive Officer

Salutation: Mr

Last Name: Mansha

Middle Name:

First Name: Raza

Department:

Mobile:

Direct FAX: +92 42 6367414

Direct tel: +92 42 111 11 33 33

Personal E-Mail: [email protected]

http://www.dgcement.com/




38

Organization: Carbon Services(Private)Limited

Street/P.O.Box: 19 Davis Road

Building: 2nd Floor, Al Maalik,

City: Lahore

State/Region: Punjab

Postfix/ZIP:

Country: Pakistan

Telephone: +92-42-36313235 / 36313236

FAX: +92-42-36312959

E-Mail:

URL: www.carbon.com.pk

Represented by: Mr. Omar M. Malik

Title: Director

Salutation: Mr

Last Name: Malik

Middle Name: M

First Name: Omar

Department:

Mobile: +92-300-8463743

Direct FAX: +92-42-36312959

Direct tel: +92-42-36313235 / 36313236

Personal E-Mail: [email protected]

http://www.carbon.com.pk/




39

Organization: First Climate (Switzerland) AG

Street/P.O.Box: Stauffacherstr.45

Building:

City: Zurich

State/Region: Zurich

Postcode/ZIP: 8004

Country: Switzerland

Telephone: +41-44-298 2800

FAX: +41 44-298 2899

E-Mail: [email protected]

URL: www.firstclimate.com

Represented by:

Title: Board Member

Salutation: Mr

Last name: Lüchinger

Middle name:

First name: Alexander

Department:

Mobile:

Direct FAX: +41 44 298 28 99

Direct tel: +44 44 298 28 07

Personal e-mail: [email protected]


http://www.firstclimate.com/



40

Annex 2

INFORMATION REGARDING PUBLIC FUNDING

There is no public funding involved in the project activity



41

Annex 3

BASELINE INFORMATION

Captive Power Plant Emission Factor Determination

Fuel Characteristics

Density of diesel kg/l 0.87

NCV of diesel

BTU/lb 18,260

MJ/l 36.95

Emission coefficient of diesel tCO2/TJ 74.8

NCV of HFO

BTU/lb 17,308

GJ/t 40.2584

Emission factor of HFO tCO2/GJ 0.0788

NCV of natural gas

BTU/ft3 828

MJ/Nm3 30.85

Emission factor of natural gas tCO2/GJ 0.0583

Emission Factor of Captive Power Plant

Year

2007/08

Year

2008/09

Year

2009/10 Total

Total electricity generated by

captive power plant MWh/yr 130,689 148,129 146,406 425,224

HFO Consumption t/yr 1,154 3,653 1,646 6,452

Natural Gas Consumption Nm3 3,640,664 34,209,019 34,167,643 72,017,325

Diesel Consumption l/yr 322,143 323,126 333,233 978,502

Weighted Average Coefficient of

captive power plant tCO2/GJ 0.0601

Total energy consumption by

captive power plant in historical

years GJ 3328423.53

Emission factor for captive

power plant tCO2/MWh 0.4703



42

Grid Emission Factor Determination

The grid emission factor has been determined according to “Tool to calculate the emission factor for an

electricity system” version 02.2.1 (hereafter referred to as “the Tool”)

Electricity baseline emission factor (EFGrid, CM, BL) is calculated ex-ante as a combined margin consisting

of a combination of operating margin (OM) and build margin (BM) factors according to the following

steps:

STEP 1: Identify the relevant electricity systems;

STEP 2: Choose whether to include off-grid power plants in the project electricity system (optional);

STEP 3: Select a method to determine the operating margin (OM);

STEP 4: Calculate the operating margin emission factor according to the selected method;

STEP 5: Calculate the build margin (BM) emission factor,

STEP 7: Calculate the combined margin (CM) emission factor.

Step 1 – Identify the relevant electricity systems

Pakistani DNA has not published any delineation of the project electricity system and a connected

electricity system. Moreover, the criteria provided in the “Tool to calculate the emission factor for an

electricity system” under Step 1 do not result in a clear grid boundary as

1) a spot market for electricity does not exist in Pakistan

2) there is no official data available with regard to the operation of the transmission line between

different electricity systems.

In such cases, the Tool suggests “to use a regional grid definition in the case of large countries with

layered dispatch systems (e.g. provincial/regional/national)” to distinguish a connected electricity system.

In Pakistan, the electricity supply business is a sort of monopoly of two companies. For Karachi city and

adjoining areas of Sindh and Balochistan, it is under Karachi Electric Supply Corporation (KESC).

For rest of the Pakistan it falls under Water and Power Development Authority (WAPDA). In 1998, as

part of the government’s privatization policy, the National Transmission & Despatch Company (NTDC)5

“was organized to take over all the properties, rights and assets obligations and liabilities of 220 KV and

500 KV Grid Stations and Transmission Lines/Network Transmission Lines/Network owned by Pakistan

Water and Power Development Authority (WAPDA). Both NTDC and KESC operate their own

transmission networks but they are also physically interconnected to each other at two points6 and trade

electricity in significant amounts7 in a sort that they both together constitute the national grid system,

which becomes the project electricity system also.

5 cf. www.ntdc.com.pk

6 One is the Jamshoro - BinQasim link in East of Karachi and other is HUBCO-KESC link in West of Karachi.

7 Actually 32% of total electricity supply in KESC in the year 2006/7 was purchased from NTDC. Cf.

PEPCO/National Transmission & Despatch Co. (NTDC)/Planning Power Department (NTDC) 2008: Electricity

Marketing Data (Power Systems Statistics), 32nd

issue, Updated up to 30th

June 2007. p. 90

http://www.ntdc.com.pk/



43

The project activity is connected to the grid of Faisalabad Electric Supply Company Limited (FESCO),

which is one of nine newly created distribution companies8 and connected to NTDC, which is part of the

national grid system.

Step 2: Choose whether to include off-grid power plants in the project electricity system (optional)

The Tool allows the project participant to choose between the following two options to calculate the

operating margin and build margin emission factor:

Option I: Only grid power plants are included in the calculation

Option II: Both grid power plants and off-grid power plants are included in the calculation.

Option I is chosen as data is publicly available only for grid power plants.

Step 3 – Select a method to determine the operating margin (OM)

The Tool offers four options for the calculation of the Operating Margin emission factor(s) (EFgrid,OM,y):

(a) Simple OM, or

(b) Simple adjusted OM, or

(c) Dispatch Data Analysis OM, or

(d) Average OM.

Information to carry out a detailed dispatch data analysis is not publicly available; therefore the dispatch

data analysis OM is not selected for the proposed project and the Simple OM option is chosen.

The Simple OM requires that the share of low-cost/must-run resources constitutes less than 50% of the

total net electricity generation of the national grid. In Pakistan, the share of low-cost/must-run resources

usually constitutes less than 50% of the total net electricity generation of the national grid.

According to the Tool, for simple OM, the emission factor can be calculated using either of the two

following data vintages:

Ex ante option: For grid power plants, a 3-year generation weighted average, based on the most

recent data available at the time of submission of the CDM-PDD for validation, without

requirement to monitor and recalculate the emissions factor during the crediting period. For off-

grid power plants, use a single calendar year within the 5 most recent calendar years prior to the

time of submission of CDM-PDD or

Ex post option: The year in which the project activity displaces grid electricity, requiring the

emission factor to be updated annually during monitoring. The data required to calculate the

emission factor for year y is usually only available later than six months after the end of year y.

Project proponents employ the “ex-ante option” for its operating margin calculation.

Step 4 - Calculate the operating margin emission factor according to the selected method

8 http://www.nepra.org.pk/lic_distribution.htm

http://www.nepra.org.pk/lic_distribution.htm



44

The simple OM emission factor is calculated as the generation-weighted average CO2 emissions per unit

of net electricity generated (tCO2/MWh) by all generating power plants serving the system, not including

low-cost/must-run power/units. The Tool offers two options for the calculation of the Simple OM.

Option A: Based on the net electricity generation and a CO2 emission factor of each power unit; or

Option B: Based on the total net electricity generation of all power plants serving the system and the fuel

types and total fuel consumption of the project electricity system (Option B);

Option B can only be used if:

(a) The necessary data for Option A is not available; and

(b) Only nuclear and renewable power generation are considered as low-cost/must-run sources and the

quantity of electricity supplied to the grid by these sources is known; and

(c) Off-grid power plants are not included in the calculation (i.e., if Option I has been chosen in Step 2)

In the Pakistani public available data, CO2 emission factor for each power generation unit is not available.

Only nuclear and renewable generation are considered as low-cost/must-run sources; furthermore, the

quantity of electricity supplied to the grid by these sources is known. Finally, off-grid plants are not

considered in the calculation; therefore, Option B is chosen.

For Option B, the Simple OM emission factor is calculated based on the net electricity supplied to the

grid by all power plants serving the system, not including low-cost / must-run power plants / units, and

based on the fuel type(s) and total fuel consumption of the project electricity system:

y Grid , OM simple,EF =

, , 2, ,* *i y i y CO i y

i

y

FC NCV EF

EG [Eq.7]

Where:

EF

Grid, OM simple, y is the simple operating margin CO

2 emission factor in year y (tCO2/MWh)

FCi,y

is the amount of fossil fuel type i consumed in the project electricity system in

year y (mass or volume unit)

NCVi,y

is the net calorific value (energy content) of fossil fuel type i in year y (GJ / mass

or volume unit)

EFCO2,i,y

is the CO2 emission factor of fossil fuel type i in year y (tCO

2/GJ)

EGy is the net electricity generated and delivered to the grid by all power sources

serving the system, not including low-cost / must-run power plants / units, in year

y (MWh)

i are all fossil fuel types combusted in power sources in the project electricity

system in the baseline period



45

y is the relevant year as per the data vintage chosen in step 3.

Step 5. Calculate the build margin (BM) emission factor

In terms of vintage of data, project participants can choose between one of the following two options:

Option 1. For the first crediting period, calculate the build margin emission factor ex-ante based on the

most recent information available on units already built for sample group m at the time of CDM-PDD

submission to the DOE for validation. For the second crediting period, the build margin emission factor

should be updated based on the most recent information available on units already built at the time of

submission of the request for renewal of the crediting period to the DOE. For the third crediting period,

the build margin emission factor calculated for the second crediting period should be used. This option

does not require monitoring the emission factor during the crediting period.

Option 2. For the first crediting period, the build margin emission factor shall be updated annually, ex-

post, including those units built up to the year of registration of the project activity or, if information up to

the year of registration is not yet available, including those units built up to the latest year for which

information is available. For the second crediting period, the build margin emissions factor shall be

calculated ex-ante, as described in option 1 above. For the third crediting period, the build margin

emission factor calculated for the second crediting period should be used.

In accordance with the ex-ante calculation of the operating margin (see Step 3), Option 1 is chosen.

The sample group of power units m used to calculate the build margin consists should be determined as

per the following procedure, consistent with the data vintage selected above:

(a) Identify the set of five power units, excluding power units registered as CDM project activities,

that started to supply electricity to the grid most recently (SET5-units) and determine their annual

electricity generation (AEGSET-5-units, in MWh);

(b) Determine the annual electricity generation of the project electricity system, excluding power

units registered as CDM project activities (AEGtotal, in MWh). Identify the set of power units,

excluding power units registered as CDM project activities, that started to supply electricity to

the grid most recently and that comprise 20% of AEGtotal (if 20% falls on part of the generation

of a unit, the generation of that unit is fully included in the calculation) (SET≥20%) and determine

their annual electricity generation (AEGSET-≥20%, in MWh);

(c) From SET5-units and SET≥20% select the set of power units that comprises the larger annual

electricity generation (SETsample); Identify the date when the power units in SETsample started to

supply electricity to the grid. If none of the power units in SETsample started to supply electricity

to the grid more than 10 years ago, then use SETsample to calculate the build margin. Ignore steps

(d), (e) and (f).

Otherwise:

(d) Exclude from SETsample the power units which started to supply electricity to the grid more than

10 years ago. Include in that set the power units registered as CDM project activity, starting with

power units that started to supply electricity to the grid most recently, until the electricity

generation of the new set comprises 20% of the annual electricity generation of the project

electricity system (if 20% falls on part of the generation of a unit, the generation of that unit is

fully included in the calculation) to the extent is possible. Determine for the resulting set



46

(SETsample-CDM) the annual electricity generation (AEGSET-sample-CDM, in MWh);

If the annual electricity generation of that set is comprises at least 20% of the annual electricity

generation of the project electricity system (i.e. AEGSET-sample-CDM ≥ 0.2 × AEGtotal), then use the

sample group SETsample-CDM to calculate the build margin. Ignore steps (e) and (f).

Otherwise:

(e) Include in the sample group SETsample-CDM the power units that started to supply electricity to the

grid more than 10 years ago until the electricity generation of the new set comprises 20% of the

annual electricity generation of the project electricity system (if 20% falls on part of the

generation of a unit, the generation of that unit is fully included in the calculation);

(f) The sample group of power units m used to calculate the build margin is the resulting set

(SETsample-CDM->10yrs).

As shown in the attached EXCEL file, AEGSET-5-units is largely below AEGSET-≥20%, so SET≥20% is selected

as SETsample. Also, given that there are not CDM power plants that can be included and the SETsample

includes plants that are operating since more than 10 years, SETsample is equivalent to SETsample-CDM->10yrs.

Then, the build margin emissions factor is the generation-weighted average emission factor (tCO2/MWh)

of all power units m during the most recent year for which power generation data is available, calculated

as follows:

Grid , BM , yEF =

m

ym

m

ymELym

EG

EFEG

,

,,, *

Eq.13]

Where:

EFGrid, BM, y is the Build Margin CO2emission factor in the year y (tCO2/MWh)

EGm,y is the net quantity of electricity generated and delivered to the grid by power unit m in the

year y (MWh)

EFEL,m,y is the CO2 emission factor of power unit m in year y (tCO2/MWh)

m are the power units included in the build margin

y is the most recent historical year for which the power generation data is available

The CO2 emission factor of each power unit m (EFEL,m,y ) should be determined as per the guidance in step

4 (a) for the simple OM, using options A1, A2 or A3, using for y the most recent historical year for which

power generation data is available, and using for m the power units included in the build margin.

If the power units included in the build margin m correspond to the sample group SETsample-CDM->10yrs, then,

as a conservative approach, only option A2 from guidance in Step 4 (a) can be used and the default values

provided in Annex 1 of the Tool shall be used to determine the parameter ηm,y.

On the basis of the data available, option A2 is used:



47

Step 6 - Calculate the combined margin emission factor

The calculation of the combined margin (CM) emission factor (EFgrid,CM,y) is based on one of the

following methods:

(a) Weighted average CM; or

(b) Simplified CM.

The weighted average CM method (option A) should be used as the preferred option.

The simplified CM method (option b) can only be used if:

The project activity is located in a Least Developed Country (LDC) or in a country with less than

10 registered projects at the starting date of validation; and

The data requirements for the application of step 5 above cannot be met.

Method (a), weighted average CM, is selected.

Therefore, the combined margin emission factor is calculated as follows:

EFgrid,CM,y = wOM * EFgrid,OM,y + wBM * EFgrid,BM,y [Eq.14]

Where:

EFGrid, BM, y is the build margin CO2 emission factor in the year y (tCO2/MWh)

EFGrid, OM, y is the operating margin CO2 emission factor in the baseline period (tCO2/MWh)

wOM is the weighting of operating margin emissions factor (%)

wBM is the weighting of build margin emissions factor (%).

The default weights are as follows: wOM = wBM = 0.5.

The attached EXCEL sheet reflects the methodological selections indicated above, and provides the final

result.



48

Annex 4

MONITORING INFORMATION

Please refer to section B.7.1 and B.7.2.

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