unep collaborating centre on energy and environment rules for small-scale cdm projects prepared for...

UNEP Collaborating Centre on Energy and Environment

Rules for Small-Scale CDM Projects

Prepared for the CD4CDM Regional Workshop in Tunis

25-26 January 2003

Jørgen Fenhann


• Modalities and Procedures for the small-scale CDM• Decisions at the EB7 meeting• Three types of small-scale CDM projects• Present eligible project categories• Baseline and monitoring methodologies for small-scale CDM projects

• Additionality• Determining the occurrence of debundling• The 13 small-scale project categories one-by-one

Contents


Modalities and Procedures (M&P) for the Small Scale CDM

A special M&P for Small-Scale CDM was adopted at COP8, and can be found on the UNFCCC-CDM home page.

The M&P describe the general rules for the CDM project cycle, and the Executive Board have developed more detailed rules in their first 7 meetings. At their last meeting (EB7, 20-21 January 2003) the detailed rules for Small-Scale CDM were finalised.Now we are only waiting for the Russians to Ratify, hopefully this spring


Decisions at the EB7 meeting

The "Draft Simplified Modalities and Procedures for Small-Scale Clean development Mechanism Project Activities" was adopted at COP 8. The three annexes to this document was processes and adopted at EB7:

• Annex A: "Small-scale Project Design Document (SSC- PDD)".

• Annex B: "Indicative simplified baseline and monitoring methodologies for selected small-scale CDM project activity categories”

• Annex C: On "determining the occurrence of debundling"


The three types of small-scale CDM projects

(i) Renewable energy project activities with a maximum output capacity equivalent of up to 15 MW; (ii) Energy efficiency improvement project activities which reduce energy consumption, on the supply and/or demand side, by up to 15 GWh per year; or (iii) Other project activities that both reduce anthropogenic emissions by sources and directly emit less than 15 kilotonnes of carbon dioxide equivalent annually.


Present eligible project categories

Project types Project activity categoriesType i: A. Electricity generation by userRenewable B. Mechanical energy for the userenergy projects C. Thermal energy for the user

D. Renewable Electricity generation for a gridType ii: A. Supply side energy efficiency improvements - transmission and distribution Energy efficiency B. Supply side energy efficiency improvements - generationimprovement C. Demand-side energy efficiency programmes for specific technologiesprojects D. Energy efficiency and fuel switching measures for industrial facilities

E. Energy efficiency and fuel switching measures for buildingsType iii: A. AgricultureOther project B. Switching fossil fuelsactivities C. Emission reductions by low-greenhouse emission vehicles

D. Methane recovery and avoidanceTypes i - iii: Other small-scale project


Baseline and monitoring methodologies for small-scale CDM projects

For most of the present eligible project categories there exist simplified methodologies.

A CDM project participant can suggest a new project category or methodology by making a request to the EB. The EB shall then on its next meeting review the proposed methodology and once approved, amend annex B on their CDM homepage.

Only if the technology is transferred from another activity is leakage calculation required.

In the following the project categories are presented:


Additionality

Project participants shall provide an explanation to show that the project activity would not have occurred anyway due to at least one of the following barriers:

• Investment barrier• Technological barrier• Barrier due to prevailing practice• Other barriers: institutional, limited information, managerial resources, organizational capacity, financial resources, or capacity to absorb new technologies


Determining the occurrence of debundling

•The text in Annex C was adopted at EB7

•A small-scale project activity shall be deemed to be a debundled component of a large project activity if the is a registered CDM project activity or an application:• With the same project participants;• In the same project category and technology/measure;• Registered within the previous 2 years; and• Whose project boundary is within 1 km of the project boundary of the proposed small-scale activity at the closest point

If the total size is below the “15” limit it is eligible.


Category 1.A. Electricity generation by the user

This category comprises renewable technologies that supply individual households or users with a small amount of electricity.

Examples: Solar home systems, micro hydro, small wind power, solar/wind battery chargers.

Baseline: The energy used or the electricity use among similar electricity consuming users in the nearest community. A default value of 0.9 kgCO2/kWh can be used.

Monitoring: metering or an annual check of a sample.


Category 1.B. Mechanical energy by the user

Examples: Hydro power,wind power and other renewable energy technologies that provide mechanical energy used on site by the household or user: wind-powered pumps, solar water pumps, water mills.

Baseline: Emissions from the same load with a diesel generator. Default emission factor for diesel = 3.2 kgCO2/kg diesel

Monitoring: recording annual the number of systems operating and annual hours of operation for a sample.


Category 1.C. Thermal energy by the user

This category comprises renewable energy technologies that supply individual households or users with thermal energy that displaces fossil fuel or non-renewable sources of biomass: Solar water heaters, solar dryers, solar cookers, energy derived from biomass for water-heating, space heating, or drying etc. For co-generating systems maximum capacity is 45 MWth

Baseline: the fossil fuel used before and the biomass consumption before times an emission factor for non-renewable biomass use.

Monitoring: Metering of energy produced and for red.< tCO2/yr/unit number of systems operating


Category 1.D. Renewable Electricity generation for a grid

Mini grid 24 h 4-6 h withKgCO2/kWh service service storageLoad factors 25% 50% 100%<15 kW 2.4 1.4 1.215-35 kW 1.9 1.3 1.135-135 kW 1.3 1 1135-200 kW 0.9 0.8 0.8>200 kW 0.8 0.8 0.8

This category comprise renewables: PVs, hydro, tidal/wave, wind, geothermal and biomass making electricity for a grid.

For small networks emission coefficients below is used.

For other systems an average of ”approximate operating margin” and ”build margin” is used, or a weighted average emissions of current generation mix if data not available.


Category 2.A. Supply side energy efficiency improvements – transmission and distribution

This category comprises technologies or measures to improve the energy efficiency of electricity and district heating grids. Both for existing systems or an expansion.

Baseline: The technical energy loss before or for new systems the technical energy loss for a standard of equipment the would otherwise have been installed, times an emission coefficient as in 1.D.

Monitoring: metering of technical energy loss, or if impossible calculated with test results when equipment was commissioned.


Category 2.B. Supply side energy efficiency improvements – Generation

This category comprises technologies or measures to improve the efficiency of fossil fuel generating units like power plants, district heating plants and co-generation. Both for existing systems or a new facility.

Baseline: The energy consumed before or for new systems the energy loss for a standard of equipment the would otherwise have been installed, times an emission coefficient for the fuel used.

Monitoring: metering of energy used and electricity/heat produced before and after.


Category 2.C. Demand-side energy efficiency programmes for specific technologies

This category comprises programmes that encourage the use of energy-efficient equipments, lamps, ballasts, refrigerators, motors, fans, air conditioners, appliances etc . At many sites

Baseline: number of devices times power of device times average annual operating hours/ grid loss times emission coefficient as in 1.D.

Monitoring: the number and power and operating hours of replaced devices. Annual check of a sample to show that they are still operating.


Category 2.D. Energy efficiency and fuel switching measures for industrial facilities

This category covers project activities aimed primarily at energy efficiency (3.B if aimed primarily at fuel switching) like efficient motors e.t.c, and efficiency measures for specific industrial purposes (steel furnaces, paper drying, tobacco curing e.t.c). Both for existing equipment or in a new facility.

Baseline: energy use of replaced equipment, and for new facilities for the equipment that would otherwise have been used/grid loss times an emission coefficient as in 1.D. Monitoring: metering of old equipment or calculation of savings.


Category 2.E. Energy efficiency and fuel switching measures for buildings

This category comprises any energy efficiency and fuel switching measure implemented at a single building/ group of buildings, commercial, institutional or residential. Primarily aimed at energy efficiency: better insulation, optimal arrangement of equipments, efficient appliances. Both for existing equipment or in a new facility.

Baseline: energy use for existing equipment or what would otherwise have been used/grid loss times emission factor as in 1.D.

Monitoring: metering the energy use of before and after or calculation of savings.


Category 3.A. Agriculture

Activities in this category are possible, but the EB thinks that more work is needed on this category before proposing simplified baselines and monitoring methodologies.

Project type according to IPCC:• Reduction of enteric fermentation• Reduction of emissions from manure management• Reduced emissions from rice cultivation• Improved fertilizer usage


Category 3.B. Switching fossil fuels

This category comprises existing industrial, residential, commercial, institutional or electricity generation applications. If the project primarily focuses on energy efficiency it is eligible under 2.D. or 2.E.

Baseline: Current emission of the facility expressed as emission per unit of output.

Monitoring of the fuel use and output for an appropriate period (e.g. records for a few years) before the fuel switch, and after the fuel switch.


Category 3.C. Emission reductions by low-greenhouse emission technologies

This category comprises low-greenhouse emission vehicles

It do not look like there is a category for other transport project like: transport mode switching, activity changes, load factor increases e.t.c

Baseline: The emissions from the replaced vehicle

Monitoring: number of vehicles, annual service (km?) for a sample.


Category 3.D. Methane recovery and avoidance

This category comprises CH4 recovery form coal mines, landfills, wastewater treatment facilities e.t.c

If the CH4 is used for heating purposes the project is eligible under 1.C.

If the CH4 is used for electricity production the project is eligible under 1.D.

Baseline: The CH4 emitted in the absence of the project

Monitoring: The CH4 used and combusted + CH4 content in the gas

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