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PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 1

CLEAN DEVELOPMENT MECHANISM PROJECT DESIGN DOCUMENT FORM (CDM-PDD)

Version 03 - in effect as of: 28 July 2006

CONTENTS A. General description of project activity B. Application of a baseline and monitoring methodology C. Duration of the project activity / crediting period D. Environmental impacts E. Stakeholders’ comments

Annexes Annex 1: Contact information on participants in the project activity Annex 2: Information regarding public funding

Annex 3: Baseline information

Annex 4: Monitoring plan Annex 5: Project Financial Analysis

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 2 SECTION A. General description of project activity A.1 Title of the project activity: >> Title: TPI Polene Power Waste Heat Recovery Power Plant Project, Thailand (TPIPP WHR Project) Version: 01 Date: 14 May 2008

A.2. Description of the project activity : >> The project activities involve waste heat recovery and utilisation for power generation at TPI Polene (TPIPL) cement plant in Saraburi province of Thailand. TPIPL is the third largest cement manufacturer in Thailand, with clinker production capacity of 9.0 million tonnes per year. TPIPL cement plant currently has 3 clinker production lines and is in the process of installing the 4th clinker production line, which will increase its capacity to 1.3 million tonnes of clinker per year. All the clinker production lines employ dry process technique to produce high quality cement. In the clinker production process, the raw meal is heated up to 750°C in the suspension pre-heater before entering the rotary kiln to form clinker at 1,450°C. The hot gas leaving the suspension pre-heater (SP) still has the temperature around 350°C. Clinker from rotary kiln will enter an air quenching cooler (AQC) where it will be cooled down from 1,370°C to 95-105°C, while the cool air is heated to 420°C. The current practice for cement production in Thailand is to vent the waste heat directly to the atmosphere, while some plants may re-circulate a small portion of the waste heat to pre-heat the raw material before entering the clinker production process, including TPIPL. In implementing the project activity, TPIPL has contracted out the waste heat recovery and power generation to TPI Polene Power Co., Ltd. (TPIPP), a company in which TPIPL is the majority shareholder. TPIPP will invest in 6 new waste heat recovery boilers and 32 MW condensing type steam turbine generator sets for the generation of electricity. The waste heat recovery power plant is expected to generate 172,591 MWh of electricity net per year, which will displace around one-quarter of the cement plant’s electricity demand currently supplied by the grid. After the project activity is implemented, the exhaust of the heat recovery boilers fitted as part of the project activity will still be used to pre-heat the raw materials as before. The purpose of the project activity can be summarised as:

⇒ Recovery of waste heat from clinker production and utilisation for power generation; ⇒ Mitigating the environmental impacts of existing practice of venting hot gases and dust; ⇒ Reduction of atmospheric emissions of the greenhouse gas (GHG) through displacement of fossil

fuel based grid electricity; and ⇒ Use of the CDM process to offset some of the financial and technical risks associated with the

investments. The project activity expects to deliver multiple benefits in respect of sustainable development in Thailand, including:

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 3 Environmental benefits

⇒ Reduction of greenhouse gas emission through the avoided electricity generation by other grid-connected power plant;

⇒ Reduction of dust and particulate matters from the installation of dust settling chambers; ⇒ Reduction of dissipating heat in the locality due to venting of waste heat; ⇒ Reduction of the water used to cool down the waste heat before venting; ⇒ Reduction in usage of non-renewable energy, ie fossil fuel for grid electricity generation;

Social benefits

⇒ Involvement of local communities through attitude surveys and public participation meeting, in which most people accepted the project;

⇒ Extended benefits to local communities, including: o Reduction of health problems related to the dust from the clinker production process; o Increased employment by employing 32 full time staffs to operate the system (including

management, engineers, technicians and administrative staff); Technology transfer

⇒ Promoting technological excellence in Thailand by being the first waste heat recovery power plant being implemented in a cement industry in Thailand at a fully commercial scale.

⇒ Enhancing the human resource development since all the power plant staff will receive necessary training on the management of the power plant.

Economic benefits

⇒ Reduction in the dependency fossil fuel for electricity generation while at the same time enhancing energy security by increasing diversity of supply;

⇒ Promoting the best practices of waste management in the cement industry in Thailand; ⇒ Generating incomes to the local community through additional local employment; ⇒ Enhancing competitiveness of cement industry in Thailand which is currently facing a lot of

competitive pressure in the global market; ⇒ Demonstrating the use of CDM as an incentive for bringing about a renewable energy project;

A.3. 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)

Thailand (host) • TPI Polene Power Co., Ltd. No (*) In accordance with the CDM modalities and procedures, at the time of making the CDM-PDD public at the stage of validation, a Party involved may or may not have provided its approval. At the time of requesting registration, the approval by the Party(ies) involved is required.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 4 A.4. Technical description of the project activity: A.4.1. Location of the project activity: A.4.1.1. Host Party(ies): >> The Kingdom of Thailand A.4.1.2. Region/State/Province etc.: >> Saraburi Province A.4.1.3. City/Town/Community etc: >> Tambon Tubkwang, Amphur Kangkhoy A.4.1.4. Detail of physical location, including information allowing the unique identification of this project activity (maximum one page): >> The project is located at TPI Polene Cement Plant in Saraburi province, approximately 130 km to the north of Bangkok. The project location is depicted in Figure 1. Mailing address: 299 Moo 5, Mitraparp Road, Tambon Tubkwang, Amphur Kangkhoy, Saraburi

18260, THAILAND

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 5 Figure 1 Project Location, Saraburi Province, Thailand

A.4.2. Category(ies) of project activity: >> The project falls into sectoral scope 1 - Energy industries (renewable / non-renewable sources) – and sectoral scope 4 – Manufacturing industries – as defined by the UNFCCC. A.4.3. Technology to be employed by the project activity : >> Portland cement is the most common type of cement in general usage in many parts of the world and is also the major product of TPIPL. Portland cement is made up of more than 90% ground cement clinker, a maximum of about 5% gypsum and up to 5% minor constituents. Cement production at TPIPL consists of the following stages:

1. Raw material preparation. Raw materials, such as lime stone and shale are crushed individually at room temperature.

2. Grinding . Crushed raw materials are mixed, ground and then heated up to around 80°C to remove moisture.

3. Clinker production . The raw meal is feeded into in 6-stage cyclone type suspension pre-heater where it is heated up to 750°C before entering the rotary kiln to form clinker at 1,450°C. The hot gas leaving the suspension pre-heater (SP) still has the temperature around 300°C. Clinker from


rotary kiln will enter an air quenching cooler (AQC) where it will be cooled down from 1,370°C to 95-105°C, while the cool air is heated to 420°C.

4. Clinker grinding . Clinker is ground and mixed with gypsum or lime stone at different proportion to make different types of cement.

5. Cement packing. Cement is packed in 50-kg bags and stored before being distributed. TPIPL cement plant currently has 3 clinker production lines with clinker production capacity of 9.0 million tonnes per year and is in the process of installing the 4th clinker production line, which will increase its capacity to 1.3 million tonnes of clinker per year. All the clinker production lines employ dry process technique to produce high quality cement. In the cement production process, there are 2 main sources that generate significant amount of waste heat, which are hot gas leaving the suspension pre-heater (SP) and hot air leaving air quenching cooler (AQC). Prior to the implementation of the project, most of the waste heat is vented to the atmosphere and some is used to pre-heat the raw material before entering the clinker production process as depicted in I. The flow and temperature of waste heat that is expected to be vented from 3 existing clinker production lines for a typical production year are shown in Table 1.

Figure 2 Schematic of Waste Heat Generation and the Current Management Practice

PreheaterTower

Clinker to Silo

Cool air

Hot gas 420°C

Hot gas 300°C

Rotary Kiln

Raw Meal

AQC

Coalfuel oil

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 7 Table 1 Flows and temperatures of hot gases utilized for power generation

Clinker Line Source of hot gas Flow (Nm3/hr) Temp (°°°°C) Air Quenching Cooler 300,000 420

1 Preheater 480,000 300 Air Quenching Cooler 250,000 420

2 Preheater 500,000 300 Air Quenching Cooler 300,000 420

3 Preheater 510,000 300

Source: TPIPL EIA report, April 2007 The project activity will collect these hot gases and pass them through waste heat recovery boilers to generate steam for power generation as depicted in Figure 3. The expected amounts of steam generation from each boiler are shown in Table 2.

Figure 3 Schematic of Waste Heat Generation and the Its Utilisation for Power Generation

PreheaterTower

Clinker to Silo

Cool air

Hot gas 420°C

Hot gas 300°C

Rotary Kiln

AQC

SP Boiler

Steam

32 MW Generator

Condensatewater

AQC Boiler

Coalfuel oil

Raw Meal

Project Boundary

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 8 Table 2 Rate of steam generation from each boiler

Clinker Line Boiler type Pressure (MPa) Temp (°C) Flow (Nm3/hr)

AQC Boiler (HP) 2.60 405 32.5 AQC Boiler (LP) 0.55 184 5.6 1 SP Boiler 2.60 294 19.0



Source: TPIPL EIA report, April 2007 Both high pressure and low pressure steam generated from AQC boilers and SP boilers will be used to drive 2 condensing type steam turbines that are connected with 2 * 16 MW electric generators to generate 6.3 kV 3 phase electricity. The amount of useful electricity expected to be supplied to TPIPL cement plant (ie after own uses and losses) is 172,591 MWh/year. The flow diagram of waste heat recovery and power generation process is depicted in Figure 4.

Figure 4 Waste heat recovery and power generation process

Source: TPIPL EIA report, April 2007


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

Years

Annual estimation of emission reductions in tonnes of CO2 e

Mar – Dec 2009 74,802 2010 89,517 2011 89,517 2012 89,517 2013 89,517 2014 89,517 2015 89,517 2016 89,517 2017 89,517 2018 89,517

Jan – Feb 2019 14,715 Total estimated reductions (tonnes of CO2 e) 895,166 Total number of crediting years 10 Annual average over the crediting period of estimated reductions (tones of CO2 e) 89,517 A.4.5. Public funding of the project activity: >> No Annex-I country financial support for this project has been received.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 10 SECTION B. Application of a baseline and monitoring methodology B.1. Title and reference of the approved baseline and monitoring methodology applied to the project activity : >> − Version 02 of AM0024 – Baseline methodology for greenhouse gas reductions through waste heat

recovery and utilization for power generation at cement plants − Version 01 of Tool to calculate the emission factor for an electricity system − Version 04 of tool for the demonstration and assessment of additionality B.2 Justification of the choice of the methodology and why it is applicable to the project activity: >> The proposed project activity meets each of the applicability conditions of the methodology AM0024, as justified in the following table.

Applicability conditions Justification 1) The electricity produced is used within the cement

works where the proposed project activity is located and excess electricity is supplied to the grid; it is assumed that there is no electricity export to the grid in the baseline scenario (in case of existing captive power plant);

− All the electricity produced by the project activity will be used within the cement works where the project activity is located, and will partially displace electricity currently bought from the grid. There is no existing captive power plant and, therefore, no electricity export to the grid in the baseline scenario.

2) Electricity generated under the project activity displaces either grid electricity or from an identified specific generation source. Identified specific generation source could be either an existing captive power generation source or new generation source;

− TPIPL currently buys all the electricity used for its cement works from the grid (except for the 5.6 MW back-up diesel generators). Electricity generated under the project activity will displace grid electricity.

3) The grid or identified specific generation source option is clearly identifiable;

− Thailand has a single national grid electricity system so that the grid generation source option is clearly identifiable.

4) Waste heat is only to be used in the project activity; − Waste heat will only be used in the project activity. 5) In the baseline scenario, the recycling of waste heat

is possible only within the boundary of the clinker making process (e.g. clinker production lines in baseline scenario could include some heat recovery systems to capture a portion of the waste heat from the cooler end of the clinker kiln and use this to heat up the incoming raw materials and fuel - so called Type 1 Waste Heat Utilization as described in explanatory note).

− Most of the waste heat is currently vented to the atmosphere while only a small portion is used within the boundary of the clinker making process to pre-heat the raw material before entering the clinker production process, which is classified as Type 1 Waste Heat Utilisation..


Applicability conditions Justification 6) This methodology is NOT applicable to project

activities where the current use of waste heat or the identified alternative business as usual use of waste heat is located outside of the clinker making process (so called Type 2 Waste heat utilization as described in explanatory note below);

− There is no current use of waste heat or the identified alternative business as usual use of waste heat outside of the clinker making process or Type 2 Waste Heat Utilisation.

7) This methodology is NOT applicable to project activities that affect process emissions from cement plants.

− The project activity does not involve any changes in the cement production process, and therefore will not affect process emissions from cement plants.

B.3. Description of the sources and gases included in the project boundary >> For the purpose of determining GHG emissions of the project activity , the following emissions sources are included:

• CO2 emissions from on-site fuel consumption of fossil fuels. For the purpose of determining the baseline, the following emission sources are included:

• On-site fossil fuel consumption within project boundary; and • From electricity generation, either in captive power generation source or the generation sources

connected to grid that serves the proposed project site, as in the identified baseline scenario. The physical boundary includes the facilities constructed/erected on account of the project activity at the cement plant. In the case of displaced grid electricity, it further includes the local power grid system connected to the project activity; in the case of captive power, it also includes the “inside the fence” electrical system. The spatial extent of the project electricity system, including issues related to the calculation of the build margin (BM) and operating margin (OM), as further defined in the tool to calculate the emission factor for an electricity system. Table 3 illustrates which emissions sources are included and which are excluded from the project boundary for determination of both baseline and project emissions.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 12 Table 3 Overview on emissions sources included in or excluded from the project boundary

Source Gas Included? Justification CO2 Included Main emission source. CH4 Excluded Excluded for simplification. This is conservative.

Bas

elin

e Grid electricity generation/identified specific generation source

N2O Excluded Excluded for simplification. This is conservative.

CO2 Included May be an important emission source. CH4 Excluded Excluded for simplification. This emission source is

assumed to be very small.

Pro

ject

A

ctiv

ity On-site fossil fuel

consumption due to the project activity N2O Excluded Excluded for simplification. This emission source is

assumed to be very small. B.4. Description of how the baseline scenario is identified and description of the identified baseline scenario: >> The baseline scenario for the project will be identified through the following steps:

• Step 1: Determination of technically feasible alternatives to the project activity; • Step 2: Compliance with regulatory requirements; • Step 3: Undertake economic analysis of all options that meets the regulatory requirements.

This methodology is not applicable if the baseline scenario is different from the current waste heat recovery in the clinker production of the cement plant where the proposed project activity will be implemented. Step 1: Determination of technically feasible alternatives to the project activity:

Step 1.A Identify options for waste heat utilization. The general practice for the management of waste heat from clinker production process is to vent it to the atmosphere, while some more modern plant might re-circulate it to dry the raw material. Although TPIPL cement plant has already recover and utilise some of the waste heat within the energy balance boundary of the clinker making process (Type 1 waste heat utilization), a large proportion of the waste heat is still vented to the atmosphere. There are no other industrial facilities in the vicinity of the plant that could make economic use of the waste heat. Thus, the alternative to the current situation of waste heat venting (with possible re-circulating some portion for drying raw material) is to utilise it for power generation. Step 1.B Identify source of electricity supply. The demand for electricity of TPIPL cement plant is currently met by the supply of electricity from the grid. There is no existing captive power plant that supplies electricity exclusively to TPIPL cement plant (EGATEXIST = 0). The 4 x 1.4 MW back-up diesel generators connected to the cement plant is not counted as a captive power plant as it operates only in case of grid electricity outage. TPIPL currently purchases grid electricity from PEA (Provincial Electricity Authority) on a 150 MW contract and any planned increase in electricity demand from a large customer like TPIPL will have to be reported in advance so as to ensure sufficient electricity supply.


According to the methodology, ECEMENT and ELOAD, which are the electricity demand of the cement works and other local loads, should be included in the Project Design Document for at least two years prior to the start date of the project activity. The following table shows the average electricity demand of the cement work at TPIPL plant for 3 years prior to the start date of the project activities. There are no other local loads at TPIPL plant. 2004 2005 2006 Clinker production tonnes/year 6,637,095 6,947,654 7,667,403 Clinker production capacity tonnes/year 9,855,000 9,855,000 9,855,000 Average kiln running factor - 67.3% 70.5% 77.8% Electricity consumption MWh 815,550 847,451 884,858 Electricity demand for cement work (Ecement)

MW 138.2 137.2 129.8

TPIPL cement plant currently has 3 clinker production lines and is in the process of installing the 4th clinker production line, which will increase its maximum electricity demand from the current contract of 150 MW to 230 MW in 2010, as shown in the following table. Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Average Electricity Demand (MW)

150 150 230 230 230 230 230 230 230 230

It is a common practice for a cement industry in Thailand to buy electricity from the grid because Thai grid electricity provides reliable electricity supply at a competitive price. A new captive power plant is not envisaged. Therefore the only most likely option for electricity supply is grid electricity. 1

Step 2: Compliance with regulatory requirements:

The options identified in Step 1 (venting of the waste heat with possible re-circulating some portion for drying raw materials, versus recovery and utilisation of waste heat for power generation and the purchase of grid electricity) are all in full compliance of existing regulatory requirements.

Step 3: Undertake economic analysis of all options that meets the regulatory requirements.

Since there is only one alternative to the project activity, which is the continuation of the current situation, no further analysis is required. It can be concluded that the continuation of the current situation is the baseline. (Please also refer to Step 2 of Section B.5)

1 Although the methodology requires that the electricity demand of the cement works (ECEMENT) and other local loads (ELOAD) are analysed in conjunction with the baseline electricity generation of the existing captive power plant (EGATEXIST), in this project, this analysis is considered not necessary since there is no option for a captive power plant in the baseline.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 14 B.5. Description of how the anthropogenic emissions of GHG by sources are reduced below those that would have occurred in the absence of the registered CDM project activity (assessment and demonstration of additionality): >> The additionality of the project is demonstrated below using version 03 of the “Tool for the demonstration and assessment of additionality”. Step 1. Identification of alternatives to the project activity consistent with current laws and regulations Please refer to Step 1 and Step 2 of Section B.4. The following alternatives are identified.

1. Continuation of the current situation, ie continue venting waste heat and purchase electricity from the grid.

2. The proposed project activity undertaken without being registered as a CDM project activity; Both alternatives are in full compliance with current laws and regulations. Step 2. Investment analysis Sub-step 2a. Determine appropriate analysis method As the project activity generates financial benefits other than CDM related incomes, the simple cost analysis (Option I) is not applicable. The project proponent chooses to apply the benchmark analysis (Option III). Sub-step 2b – Option III. Apply benchmark analysis The relevant financial indicator that the project proponent uses as benchmark is IRR which is calculated as project IRR. The project proponent chooses to apply the benchmark rate derived from the government bond rates, increased by a suitable risk premium to reflect private investment, as substantiated by an independent (financial) expert. The benchmark is to represent standard returns in the market, considering the specific risk of the project type, but not linked to the subjective profitability expectation or risk profile of a particular project developer. As of 3rd January 2007, the 19-year government bond yield of was 6.01%2. The longest 19-year maturity is chosen to reflect the project life time of 20 years. To reflect the risk of private investment, a long term risk premium for Thailand of 6.41% as updated January 2007 is applied3. This risk premium is based on the estimate of the default spread for US corporate over the Treasury bond rate, added with the country risk premium based on the country rating from Moody’s. Thus, the suitable benchmark rate to be applied

2 Source: Thai Bond Market Association, http://www.thaibma.or.th >price&yield >yieldcurve > government; as of 3rd January 2007. 3 http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html This country risk premium is calculated by Professor Aswath Damodaran, who is Professor of Finance at Stern School of Business, New York University. Before coming to Stern, he also lectured in Finance at the University of California, Berkeley. See also http://w4.stern.nyu.edu/faculty/facultyindex.cgi?id=70 for biography of Professor Damodaran.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 15 for this project is 6.01% + 6.41% = 12.42%. Table 4 and Table 5 show the Thai government bond rate on 3 January 2007 and the country’s risk premium, respectively.

Table 4 Thai government bond rate as of 3rd January 2007

TTM Yield (%) TTM Yield (%) 1M 4.96 9 5.35 3M 4.95 10 5.45 6M 4.93 11 5.56

1 4.92 12 5.63 2 5.01 13 5.69 3 5.03 14 5.74 4 5.07 15 5.81 5 5.10 16 5.86 6 5.13 17 5.91 7 5.20 18 5.96 8 5.28 19 6.01

Source: Thai Bond Market Association, http://www.thaibma.or.th >price&yield >yieldcurve > government; as of 3rd January 2007

Table 5 Country’s risk premium, as of January 2007

Country Long-Term Rating Adj. Default Spread

Total Risk Premium

Country Risk Premium

Thailand Baa1 100 6.41% 1.50% United States Aaa 0 4.91% 0.00% Source: http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html Professor Aswath Damodaran, Stern Business School, updated January 2007. Sub-step 2c. Calculation and comparison of financial indicators (only applicable to options II and III): As per the additionality tool, if the benchmark is used, the IRR shall be calculated as project IRR. The IRR calculation is based on 20-year project life time. The key assumptions made in the calculation of the project IRR are detailed in Table 6.

Table 6 Key Assumptions for IRR Calculation

Assumption Value Unit 1. Installed capacity 36 MW

2. Project lifetime 20 years

3. Total Project Investment 1,671 Million Baht

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 16 4. Average kiln running days 300 days/year

5. Expected waste heat power plant running factor 90% of kiln running hours

6. Gross generation capacity (peak time)* 32.0 MW

Gross generation capacity (off-peak time)* 28.0 MW

7. Internal consumption capacity 2.86 MW

8. Total net generation 172,591 MWh

9. Electricity price 2.40 Baht/kWh

10. Electricity revenues 414,218,359 Baht/year

11. Total O&M cost 143,099,010 Baht/year

*Maximum waste heat provided during peak because the raw mill plant, which consume some of the waste heat, is not running during peak time The project financial feasibility study shows that the project IRR is 9.51% (not including CER revenue) based on 20-year lifetime of the project. The detail calculation of the project IRR is provided in Annex 5 Sub-step 2d. Sensitivity analysis (only applicable to options II and III): The main revenue of the project comes from the sale of electricity, which varies in proportion of the electricity price and the amount of electricity generated (which in turn depends on the kiln running hours), while the operating and maintenance cost presents the largest operating cost of the power generation in the absence of fuel cost. By varying the electricity price, kiln running hours and the O&M cost, the IRR will change as in the following tables. Pessimistic Base Case Optimistic Electricity Unit Price (Baht/kWh) -10% -5% 2.40 +5% +10% IRR (%) 7.24% 8.40% 9.51% 10.59% 11.64% Pessimistic Base Case Optimistic O&M Cost (Million Baht/year) +10% +5% 143.1 -5% -10% IRR (%) 8.74% 9.13% 9.51% 9.89% 10.26% Pessimistic Base Case Optimistic Kiln Running Days (Days/year) -10% -5% 300 +5% +10% IRR (%) 7.38% 8.46% 9.51% 10.53% 11.52% As shown above, with the increase in the electricity price, reduction of the O&M cost and increase in kiln operating days, the project IRR is still lower than the benchmark of 12.42%. This sensitivity analysis demonstrates that the result of the financial analysis is robust. Step 3. Barrier analysis Sub-step 3a. Identify barriers that would prevent the implementation of the proposed CDM project activity:

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 17 The risks associated with unfamiliar technology, together with high investment costs, have prevented the implementation of such technology on a business-as-usual basis in Thailand. These barriers include technological barriers, financial barriers and common practice barriers, as described below. TECHNOLOGICAL BARRIERS This project activity invests in a new technology, in which local support (equipment supplies and skilled labour) is not available in Thailand. All major equipment required for the operation of the power plant will have to be sourced overseas because this technical capacity was not available in Thailand. All cement plants in Thailand have relied on grid electricity and have never had any experience operating a power plant before. In addition to operating conventional power plant, operating waste heat recovery boilers requires special skills and cares in a number of areas such as removing dust from the boiler to prevent clogging in the system, boiler tube maintenance due to wearing from clinker dust abrasiveness. FINANCIAL BARRIERS This project activity requires significant amount of investment in machinery, construction, tax, insurance, etc. The project investment, as estimated by the supplier is 1,671 million Baht; however, since the construction and procurement is not completed, there could well be some unforeseen additional cost. In case of Nigguo Cement Plant (a similar registered CDM project), the investment budget overrun was as high as 20%. Investment in new technology in a non-core business of the cement manufacturer will put the project owner at significant risk and at a competitive disadvantage compared to other cement manufacturers. COMMON PRACTICE This project activity will be the first of its kind in Thailand. Experience of another CDM project activity undertaking the same activity in India (India Cements WHR project) shows that the plant has to be shut down for 2 months since the beginning of operation for modifications to the boiler to accommodate the waste heat gases due to a design fault. This analysis demonstrates that the project proponent takes on a significant amount of risk by implementing this project activity in which CDM can help to offset. Sub-step 3b. Show that the identified barriers would not prevent the implementation of at least one of the alternatives (except the proposed project activity): These barriers do not prevent the implementation of the alternative to the project activity (the continuation of current situation). Step 4. Common practice analysis Sub-step 4a. Analyse other activities similar to the proposed project activity: This project is among the first of its kind that is developed on a commercial scale in Thailand as a CDM project. There are 4 major cement manufacturers in Thailand, which are Siam Cement (SCG), Siam City Cement (SCCC), TPI Polene (TPIPL) and Asia / Jalaprathan (JCC), accounting for more than 95%

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 18 cement production capacity in Thailand. From interview with major cement manufacturer in Thailand, there has been only one waste heat recovery power plant installed at one of SCCC’s six clinker production lines in 1989. However, ever since then, SCCC did not make any further investment in waste heat recovery power plant for the remaining 5 clinker production lines, which clearly proves that this type of project is not a common practice in the cement industry in Thailand. Other similar projects are being developed in Thailand, all as a CDM project. Sub-step 4b. Discuss any similar options that are occurring: Not applicable as there is no similar project activity occurring elsewhere in Thailand except the CDM project activities. Since the Step 4a and 4b are satisfied, it can be concluded that the project activity is additional. B.6. Emission reductions:

B.6.1. Explanation of methodological choices: >> The equations applied in the estimate of emission reduction are summarised in Table 7 below.

Table 7 Summaries of equations applied

Emissions Equation applied Note Emission reduction 1 - Project emissions 2, 3, 4, 6 Equation 5 is not applied bacause IPCC 2006 has already

provided value for COEFfuel,y. Baseline emissions 7 - Grid baseline emission factor

As per tool to calculate the emission factor for an electricity system

The simple OM is used as an estimate of operating margin because the data for hourly dispatch is not available and the share of low cost must run is only 8%. The Simple OM will be calculated on an ex-ante basis based on the three most recent years of information, i.e. 2004, 2003 and 2002. The build margin emission factor is calculated using the 2004 generation data of recent additions accounting for 20% of generation. The combined margin emission factor is the average of the Simple OM and BM, with equal weights.

Emission factor from identified generation source

- Captive power plant is not in the baseline.


B.6.2. Data and parameters that are available at validation: (Copy this table for each data and parameter) Data / Parameter: FB

Data unit: TJ/year Description: Average annual energy consumption of clinker making process prior to the start

of operation of the project activity Source of data used: TPIPL Value applied:

Clinker Production Line Symbol Fuel consumption 1 FB,1 8,227 2 FB,2 9,227 3 FB,3 9,230

Total FB 26,684

Justification of the choice of data or description of measurement methods and procedures actually applied :

The data is based on one full year of cement production in 2006, which is the most recent year before the project implementation.

Any comment:

Data / Parameter: Oclinker,B Data unit: Tonnes clinker/year Description: Average annual output of clinker prior to the start of operation of the project

activity Source of data used: TPIPL Value applied:

Clinker Production Line Symbol Clinker Production 1 Oclinker,B,1 2,167,591 2 Oclinker,B,2 2,483,682 3 Oclinker,B,3 2,432,778

Total O clinker,B 7,084,051


The data is based on one full year of cement production in 2006, which is the most recent year before the project implementation.

Any comment:

Data / Parameter: OXIDfuel Data unit: - Description: Oxidation ratio of fuel used in Clinker Production

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 20 Source of data used: Table 1-6, page 1.29 in the Revised 1996 IPCC Guidelines for National

Greenhouse Gas Inventories Value of data applied:

Fuel Type Oxidation Ratio Coal 0.98 Heavy fuel oil 0.99


IPCC default values are used as per the methodology, except for tyres and biomass where default values are not provided. In such cases, the oxidation ratio is assumed to be 1.00 as this is most conservative.

Any comment:

Data / Parameter: ECEMENT

Data unit: MW Description: The electricity demand of the cement works Source of data used: TPIPL Value of data applied:

2004 2005 2006 ECEMENT 138.2 137.2 129.8


-

Any comment: - B.6.3 Ex-ante calculation of emission reductions: >>

Emission Reduction The emission reduction, ERy, during a given year y is given by:

ERy = EBy – PEy (1)

Where: EBy are the baseline emissions in year y, expressed in tCO2. PEy are the project emissions due to possible fuel consumption changes in the cement kilns, of the

cement works where the proposed project is located, as a result of the project activity in year y, expressed in tCO2.


ERy EBy PEy

t CO2e/year tCO2e/year t CO2e/year89,517 89,517 0

Project Activity

PEy = (EIP,y – EIB) * Oclinker,y * COEFfuel,y (2)

Where: EIB is the pre-project energy consumption per unit output of clinker in TJ/ton of clinker produced

(i.e. measured before the Project activity goes into operation). EIP,y is the ex-post energy consumption per unit output of clinker for given year, y, in TJ/ton of

clinker produced. COEFfuel,y is the carbon coefficient (tCO2 / TJ of input fuel) of the fuel used in the cement works in year

y to raise the necessary heat for clinker production. Oclinker,y is the clinker output of the cement works in a given year y. As suggested in the methodology, PEy can be calculated using disaggregated information as in equation (6) below:

[ ]∑∆=

iifuelicliniy COEFOEIPE ,ker ** (6)

Where: i is the index for each clinker production line in the cement plant where the project activity is

being implemented; ∆EIi is the ex-ante design estimate of the change in the energy consumption of each clinker kiln in

TJ / ton Clinker, due to project implementation.

i PEy EIP,y EIB Oclinker,y COEFfuel,y

t CO2e/year TJ/t clinker TJ/t clinker t clinker/year t CO2/TJ

1 0 3.80E-03 3.80E-03 2,167,591 98.122 0 3.72E-03 3.72E-03 2,483,682 98.133 0 3.79E-03 3.79E-03 2,432,778 98.08

0 3.77E-03 3.77E-03 7,084,051 98.11

i

Since the project activity only recovers the waste heat which would otherwise be vented, and does not alter the clinker production process, there expects to be no change in energy consumption per unit output of clinker. EIB shall be calculated using equation (3) as follows:

Bclin

BB O

FEI

ker,

=

(3)

Where:

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 22 FB is the average annual energy consumption, expressed in TJ, of clinker making process prior to

the start of operation of the project activity. At least one full year of data should be used. If a year’s worth of pre-Project Activity data is not available, then the Project Developer should outline the plan for ensuring conservativeness based on a combination of the ex-ante design estimate of energy consumption plus available measured data.

Oclinker,B is the average annual output, expressed in tonnes, of clinker prior to the start of operation of the project activity. At least one full year of data should be used.

i EIB FB Oclinker,B

TJ/t clinker TJ/year t clinker/year1 3.80E-03 8,227 2,167,5912 3.72E-03 9,227 2,483,6823 3.79E-03 9,230 2,432,778

3.77E-03 26,684 7,084,051 By the same token, EIP,y shall be calculated using equation (4).

yclin

yPyP O

FEI

ker,

,, =

(4)

Where: FP,y is monitored annual energy consumption in a year y, expressed in TJ, of clinker making

process; Oclinker,y is monitored annual output, expressed in a year y, in tonnes of clinker.

i EIP,y FP,y Oclinker,y

TJ/t clinker TJ/year t clinker/year1 3.80E-03 8,227 2,167,5912 3.72E-03 9,227 2,483,6823 3.79E-03 9,230 2,432,778

3.77E-03 26,684 7,084,051 Although it is not clear in the methodology how COEFfuel,y should be calculated when there are more than one type of fuel combusted in the same kiln, in this PDD, COEFfuel,y is calculated as a weighted average of emission factor of each type of fuel weighted by energy generated from that type of fuel in year y.

Fuel Unit COEF fuel,y Fuel used Line1 Fuel used Line2 Fuel used Line3 Fuel u sed Total NCV fuel,y

t CO2/TJ unit unit unit unit MJ/unitCoal tonne 98.30 309,327 347,067 346,321 1,002,715 26,370

Heavy fuel oil litre 77.40 1,759,857 1,880,798 2,443,547 6,084,202 39.77Weighted average emission factor 98.12 98.13 98.08 98.11

AM0024 requires that COEFfuel,y be calculated based on equation (5)4 as follows: COEFfuel,y = EFCO2,fuel,y / NCVfuel,y * OXIDfuel (5)

4 Note that there is an error in Equation (5) as provided in AM0024 which has been corrected in this PDD.


Fuel Unit COEF fuel,y EFCO2,fuel,y NCVfuel,y OXIDfuel

t CO2/TJ t CO2/unit MJ/unit %Coal tonne 98.30 2.6451 26,370 98%

Heavy fuel oil litre 77.40 0.0031 40 99% Baseline Emissions

EBy = EGCP,y * EFElec,y + EGGrid,y * EFGrid,y (7)

Where: EGCP,y is the electricity supplied from the project activity to the cement plant , expressed in MWh; EFElec, y is the emissions factor of the baseline electricity supply source, expressed as tCO2 / MWh. If

in the baseline scenario electricity is supplied from the grid, then EFElec, y is the emission factor of the grid - EFGrid,y; if electricity is supplied from the identified specific captive power generation source, then EFElec, y is the emission factor of it – EFCaptive,y

EGGrid, y is the electricity supplied from the project activity to the grid , expressed in MWh; EFGrid,y is the emissions factor of the electricity grid, expressed as tCO2 / MWh.

EBy EGCP,y EFElec,y EGGrid,y EFGrid,y

tCO2e/year MWh t CO2/MWh MWh t CO2/MWh89,517 172,591 0.5187 0 0.5187

The grid baseline emission factor (EFGrid,y) is calculated using the tool to calculate the emission factor for an electricity system as detailed in Annex 3.

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

Year Estimation of project activity emissions (tonnes of CO2e)

Estimation of baseline emissions (tonnes of CO2e)

Estimation of leakage (tonnes of CO2e)

Estimation of overall emission reductions (tonnes of CO2e)

2009 0 74,802 0 74,802

2010 0 89,517 0 89,517

2011 0 89,517 0 89,517

2012 0 89,517 0 89,517

2013 0 89,517 0 89,517

2014 0 89,517 0 89,517

2015 0 89,517 0 89,517

2016 0 89,517 0 89,517

2017 0 89,517 0 89,517

2018 0 89,517 0 89,517

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 24 2019 0 14,715 0 14,715

Total (tonnes of CO2 e) 0 895,166 0 895,166

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

B.7.1 Data and parameters monitored: (Copy this table for each data and parameter) ID number 1. Data / Parameter: NCVfuel,y Data unit: MJ/tonne (for coal) and MJ/litre (for fuel oil) Description: Net calorific value (energy content) per mass or volume unit of a fuel used in

clinker making process in year y Source of data to be used:

On-site measurement

Value of data applied for the purpose of calculating expected emission reductions in section B.5

Fuel type Symbol NCV Coal (bituminous) NCVcoal,y 26,370 Heavy fuel oil (HFO) NCVHFO,y 39.77

Description of measurement methods and procedures to be applied:

Measurement shall be made according to the international standard.

Monitoring frequency Sample of each fuel used should be taken at least once a day to measure the NCV for the calculation of FP,y and taken once a month for the calculation of COEFfuel,y.

QA/QC procedures to be applied:

Any direct measurements with mass or volume meters at the plant site should be cross-checked with an annual energy balance that is based on purchased quantities and stock changes.

Any comment:

ID number 2. Data / Parameter: EFCO2,fuel,y Data unit: t CO2/tonne (for coal) and tonne/litre (for fuel oil) Description: CO2 emission factor per unit mass or volume of the fuel used in year y Source of data to be used:

On-site measurement


Fuel type Symbol Emission Factor Coal (bituminous) EFCO2,coal,y 2.6451 Heavy fuel oil (HFO) EFCO2,HFO,y 0.0031



This emission factor shall be calculated based on the laboratory measurement of % carbon in each type of fuel, which might be provided with fuel upon purchase or measured on-site on a monthly basis. Emission factor of biomass (if any) is zero since it is carbon neutral.

Monitoring frequency Monthly QA/QC procedures to be applied:

The measurement equipment should be calibrated according to manufacturer’s recommendation.

Any comment:

ID number 3. Data / Parameter: FP,y

Data unit: TJ/year Description: Annual energy consumption in a year y of clinker making process Source of data to be used:

Onsite measurement


Clinker Production Line Symbol Fuel consumption

1 FP,y,1 8,227 2 FP,y,2 9,227 3 FP,y,3 9,230

Total FP,y 26,684


The energy of each fuel type consumed in the clinker making process must be calculated from the amount of fuel (mass or volume) multiplied by its net calorific value (NCV). The amount of fuel consumed should be measured continuously using weigh feeder with less than 3% error while the sample of each type of fuel used should be taken at least once a day to measure the NCV.

Monitoring frequency Continuously QA/QC procedures to be applied:

Any direct measurements with mass or volume meters at the plant site should be cross-checked with an annual energy balance that is based on purchased quantities and stock changes. The monitoring equipment should be calibrated according to manufacturer’s recommendation.

Any comment:

ID number 4. Data / Parameter: Oclinker,B Data unit: Tonnes clinker/year Description: Average annual output of clinker prior to the start of operation of the project

activity Source of data to be used:

Onsite measurement

Value of data applied for the purpose of calculating expected

Clinker Production Line Symbol Clinker Production

1 Oclinker,y,1 2,167,591 2 Oclinker,y,2 2,483,682

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 26 emission reductions in section B.5

3 Oclinker,y,3 2,432,778 Total Oclinker,y 7,084,051


The weighing equipment should be calibrated according to manufacturer’s recommendation.



Any comment:

ID number 5. Data / Parameter: EGCP,y Data unit: MWh/year Description: Electricity supplied from the project activity to the cement plant Source of data to be used:

On site measurement


172,591


The meter should be calibrated according to manufacturer’s recommendation. This shall be net electricity after the power plant own use.

Monitoring frequency Continuously with record taken daily QA/QC procedures to be applied:

The meter should be calibrated according to manufacturer’s recommendation. A backup electricity meter is recommended in case the main meter is out of order. Amount of electricity supplied to the cement plant can also be cross-checked with the electricity payment records.

Any comment:

ID number 6. Data / Parameter: EGGrid, y Data unit: MWh/year Description: Electricity supplied from the project activity to the grid Source of data to be used:

On site measurement

Value of data applied for the purpose of calculating expected emission reductions in

0

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 27 section B.5 Description of measurement methods and procedures to be applied:



Any comment: ID number 7. Data / Parameter: EFGrid,y Data unit: tCO2/MWh Description: Emissions factor of the electricity grid Source of data to be used:

Calculated according to the tool to calculate the emission factor for an electricity system


0.5187


The emission factor of the electricity grid shall be calculated on a yearly basis using the latest publicly available information.

Monitoring frequency Annually QA/QC procedures to be applied:

The emission factor of the electricity grid should be cross-checked with previous calculation to ensure data consistency.

Any comment: ID number 8. Data / Parameter: FCi,y

Data unit: Mass or unit volume Description: Amount of fossil fuel type i consumed by power plant in the grid electricity

system in year y Source of data to be used:

Ministry of Energy (Annual Energy Report)


See Annex 3.

Description of measurement methods and procedures to be

For Simple OM, data shall be monitored annually during the crediting period for the relevant year.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 28 applied: For BM, for the first crediting period, data shall be monitored annually ex-post.

For the second and third crediting period, only once ex-ante at the start of the second crediting period.


Any comment: ID number 9. Data / Parameter: NCVi,y

Data unit: GJ / mass or volume unit Description: Net calorific value (energy content) of fossil fuel type i in year y Source of data to be used:



See Annex 3.


For Simple OM, data shall be monitored annually during the crediting period for the relevant year. For BM, for the first crediting period, data shall be monitored annually ex-post. For the second and third crediting period, only once ex-ante at the start of the second crediting period.


Any comment: ID number 10. Data / Parameter: EFCO2,i,y

Data unit: t CO2/GJ Description: CO2 emission factor of fossil fuel type i in year y Source of data to be used:

Table 1.4 of Chapter1 of Vol. 2 (Energy) of the 2006 IPCC Guidelines on National GHG Inventories


See Annex 3.


For Simple OM, data shall be monitored annually during the crediting period for the relevant year. For BM, for the first crediting period, data shall be monitored annually ex-post. For the second and third crediting period, only once ex-ante at the start of the


second crediting period. Monitoring frequency Annually QA/QC procedures to be applied:

Any comment: ID number 11. Data / Parameter: EGy

Data unit: MWh Description: Net electricity generated and delivered to the grid by power plant in the grid

electricity system in year y Source of data to be used:



See Annex 3.


For Simple OM, data shall be monitored annually during the crediting period for the relevant year. For BM, for the first crediting period, data shall be monitored annually ex-post. For the second and third crediting period, only once ex-ante at the start of the second crediting period.


Any comment: B.7.2 Description of the monitoring plan:

>> TPIPL Power will assign a manager to coordinate data collection from various sources and ensure consistency of the method used in collecting the data. The proof of records such as purchase receipts or invoices will also be collect systematically. He will also perform a timely check of the latest update of IPCC data used in the calculation. B.8 Date of completion of the application of the baseline study and monitoring methodology and the name of the responsible person(s)/entity(ies) >> Date of completing this baseline section: 23 August 2007 Name of person/entity determining the baseline: ERM-Siam Co, Ltd

Wichet Phothiwisutwathee


ERM-Siam Co, Ltd 17th floor, Wave Place Building 55 Wireless Road Lumpini, Pathumwan Bangkok 10330 Thailand

ERM-Siam Co, Ltd is not a “project participant”. SECTION C. Duration of the project activity / crediting period C.1 Duration of the project activity: C.1.1. Starting date of the project activity: >> The construction contract is effective on 8th May 2007

C.1.2. Expected operational lifetime of the project activity: >> 20 years C.2 Choice of the crediting period and related information: >> Fixed crediting period 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: >> 01/03/2009 or the date of registration, whichever is later. C.2.2.2. Length: >> 10y-0m

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 31 SECTION D. Environmental impacts >> D.1. Documentation on the analysis of the environmental impacts, including transboundary impacts: >> An Environmental Impact Assessment (EIA) report for the implementation of the project activity has been submitted and approved by the Office of Natural Resource and Environmental Policy and Planning (ONEP) on 21 December 2007. The probable environmental impacts from the implementation of the project activity include:

1. Air quality : the recovery and utilisation of hot waste gas will help to remove some of the dust particles before passing through the electrostatic precipitators (EP). Table 8 shows that the SP boilers and AQC boilers will be able to remove around 70% and 50% of the dust particles contained in the hot waste gas, respectively.

Table 8 Dust Removal Efficiency of the Boilers

Dust Flow (tonnes/hour)

Clinker Production 1 Clinker Production 2 Clinker Production 3

SP Boiler

Dust in waste gas 33.6 35.0 35.7

Dust removed in boiler 23.5 24.5 25.0

Dust removal efficiency 69.9% 70.0% 70.0%

AQC Boiler

Dust in waste gas 9.0 7.5 9.0

Dust removed in boiler 4.5 3.8 4.5

Dust removal efficiency 50.0% 50.7% 50.0%

Source: TPIPL EIA report, April 2007

2. Solid waste management: Dust particles removed from the SP boilers, which have not undergone the clinker production process, will be reused as the raw material for the clinker production process, while dust particles from the AQC boilers can be mixed directly with the grounded clinker.

3. Water demand and water quality: the project activities require the use of additional 8,000 m3 per day of water for the boilers and the cooling tower, which will be drawn from Pa Sak River. The 5-year average flow of Pa Sak River at the point of service was 4.64 million m3/day with the minimum recorded flow of 581,667 m3/day. Since the project’s water demand is accounted for only 0.3% of the average flow or 2.4% of the minimum recorded flow, it shall not affect the water availability for other uses. Wastewater from the project will be treated and reused within the project. There will be no wastewater discharge outside the project.

4. Noise: the maximum level of noise generated by the project activity is expected to be 96 dB(A) at source of generation, and 53.5 dB(A) if measured at Subborn Village, 2 km away. When this generation source is added to the existing noise level of 50.62 – 55.81 dB(A) at Subborn Village,


the total noise level would be 55.31 – 57.82 db(A), which is lower than the noise level standard of 115 dB(A) maximum and 70 dB(A) for 24-hour average.

5. Health and safety: the recovery of hot waste gas and the generation of steam involve working in high temperature conditions. Heat insulation will be installed to the equipment with temperature higher than 54°C.

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: >> Although the above environmental impacts are considered not significant, the following mitigation measures have been proposed.

1. Despite no additional solid waste being generated, the project proponent will provide sufficient storage for the dust removed from SP boilers and AQC boilers while awaiting further usage.

2. Encapsulated equipment will be installed in order to reduce the noise level at source. 3. Provide warning sign where high level of noise could be observed and provide personal

protective equipment for all the working staffs. SECTION E. Stakeholders’ comments >> E.1. Brief description how comments by local stakeholders have been invited and compiled: >> The following description on how comments by local stakeholders have been invited and compiled is summarised from the “Public Relations and Project Information Dissemination Report: TPI Polene PCL Stops the Global Warming” The project proponents have carried out a project public relation campaign by using the following techniques:

1) Individual interview; and 2) Public participation events.

The main objectives of the project’s public relation campaign are:

• To disseminate information about the WHR project; • To receive further recommendations and concerns; and • To create public participation to the proposed project.

The target areas of the project’s public relation campaign comprise:

• Tubkwang Municipal District, Kangkhoy district; • Muak Lek sub-district, Muak Lek district; and • Mitraparp sub-district, Muak Lek district.

Individual Interviews

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 33 The interviews were conducted during 5-7 March 2008. The interviewees are representatives of the following organisations:

• Relevant provincial agencies; • District offices; • Sub-district Administrative Organisations (SAO); • Local press associations; • Local schools; • Temples; and • Local non-governmental organisations.

Public participation events The public participation events were conducted for 3 groups during 24-25 March 2008. Details of date, time and venue are as follows:

• 24 March 2008, 10.00-12.00 am, at Mitraparp SAO office; • 24 March 2008, 6.00-8.00 pm, at Ban Khao Maikwian school; and • 25 March 2008, 10.00-12.00 am, at Tubkwang Municipal District office.

Materials used in the events to provide project relevant information include:

• Handouts; • Leaflets; • Slide presentation; • Displays; and • Event evaluation forms.

Numbers and lists of participants of each event are shown in Table 9. A few selected pictures at the public participation events are shown in Figure 5.

Table 9 Participants at the Public Participation Events

Public Participation Event Number of participants

Event 1: 24 March 2008, 10.00-12.00 am, at Mitraparp SAO office 58 Event 2: 24 March 2008, 6.00-8.00 pm, at Ban Khao Maikwian school 86 Event 3: 25 March 2008, 10.00-12.00 am, at Tubkwang Municipal District office 87

Total 231

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 34 Figure 5 Public Participation Events during 24th-25th March 2008

At the registration desk

Participants attending the presentation room

During the presentation

Information displayed at the event

E.2. Summary of the comments received: >> The summary of the comments received below is summarised from the “Public Relations and Project Information Dissemination Report: TPI Polene PCL Stops the Global Warming” According to the responses from the event evaluation forms, the results were consolidated and summarised below.

• Number of respondents: 171 • 91% of the respondents were informed of the global warming issue • 59% perceived that making use of the waste heat from the cement plant instead of venting helps

lessening the global warming problem, where 37% provided no comment • 61% believed that not only the WHR project can help lessening the global warming problem, it

also lower the use of fossil fuels ie coal, natural gas and oil, where 32% provided no comment • 90% agreed with the project activity

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 35 Parts of concerning issues from the interviews and the participants during the public participation events (PPE), and responses from project proponents had been summarised and shown in the following table. Issues Responses How will the water be used in the project? And how will the used water be discharged?

It is estimated that additional 3,500 m3 per day of water is to be used by the project activity. The water usage of the project has been approved by the Royal Irrigation Department and it is excess water after being used for agricultural and communal purposes. The water used under the project will be channelled and stored in a retention pond in the plant area and will not be discharged to the water ways.

How much is the water volume of Pasak Basin during April-May? And how would it be allocated to each sector?

According to the April-May 2006 information from of the Irrigation and Maintenance Project of Pasak Dam, the volume of irrigated water from the dam was 127 million m3/month and it was adequate for utilisation of all sectors.

What is the company procedure in preserving the Muak Lek canal?

The Muak Lek canal is a part of the water source where TPI Polene PCL has managed an afforestation project. Moreover, the company has also supported in various natural resource and the environmental reservation activities and projects.

What would be the temperature of the heat from the power plant? How may it affect the local communities?

The current temperature of the vented heat is around 300-400 °C. There will not be any effect to the local community since this waste heat will be recovered and utilised in the project.

Is there any access of the TPI Polene electricity for the local community?

The electricity generated from the project activity is accounted for 32 MW. This amount of electricity can only partially substituted the amount supplied by the grid. Besides, the company cannot directly sell the electricity to the communities without authorisation from EGAT.

Who will be responsible for the pollution resulted from the project activities?

The TPI Polene’s power plant is to utilise the waste heat from the cement plant, not any other natural fuel. Thus, there would be non pollution from the project. Anyhow, if there is any problem, please contact the company.

Since this is the recovery and utilisation of waste heat, will the project cause dust which in turn affects the local communities?

As for the dust from the project, the company has installed an electrostatic precipitator in order to prevent the dust problem. The efficiency of this equipment is 99.9%. A procedure will also be set to measure the volume of dust in and out of the system.

Would it be possible to elect the committee from the local communities to assess the project activities?

The local communities can take part of the environmental assessment of the project.

Other recommendations obtained from the interviewees and the PPE participants included:

• More public relations, including positive and negative impacts on local communities, and continual information after the project in operation;

• It would be necessary to incorporate governmental agencies in monitoring the project activities; • A request that TPI Polene PCL be opened for local communities to learn more about WHR

power plant; and • A persuasion on setting up an afforestation project with the local communities.

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

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 36 Please refer to the responses in Section E.2.


Annex 1

CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY Organization: TPI Polene Power Co., Ltd. Street/P.O.Box: 299 Moo 5 Mitraparp Road, T. Tubkwang A. Kangkhoy Building: - City: Saraburi State/Region: - Postfix/ZIP: 18260 Country: Thailand Telephone: +66 36 339 111 FAX: +66 36 222 205 E-Mail: - URL: - Represented by: Title: Manager Salutation: Mr Last Name: Lerdbussarkam Middle Name: - First Name: Worawit Department: - Mobile: - Direct FAX: +66 36 222 205 Direct tel: +66 36 339 111 ext 1480 Personal E-Mail: [email protected]


Annex 2

INFORMATION REGARDING PUBLIC FUNDING There is no public funding from Annex I countries involved in this project.


Annex 3

BASELINE INFORMATION

The grid baseline emission factor used in this PDD is calculated in accordance with tool to calculate the emission factor for an electricity system (version 01). The grid emission factor is defined as the weighted average of an operating margin (OM) and a build margin (BM) emission factors within the system boundary, hence the word ‘combined margin’. The operating margin emission factor is calculated based on generation of all power plants within the system boundary whereas the build margin emission factor is based on the generation of the power plants that have been built most recently. The weights of both emission factors are 50% by default. DATA AVAILABILITY The methodology provided four methods for calculating the operating margin emission factor. Project developers will have to choose one of the four options, depending on availability of data. The data needed to calculate the OM emission factor includes:

- Amount of fuel (in a mass or volume unit) consumed by relevant power sources; - Electricity (MWh) delivered to the grid by plant; and - CO2 emission coefficient of fuel (tCO2/mass or volume unit of the fuel) which can be computed

mainly by using local information and IPCC default values shown in Table A3-4. To calculate the BM emission factor, additional information is required so as to identify power plants capacity additions in the electricity system that comprise 20% of the system generation (in MWh) and that have been built most recently. Power Plants in the System The Electricity Generating Authority of Thailand (EGAT) is sole operator of Thai national electricity grid and responsible for sufficient supply of electricity in Thailand. Although Thailand has opened opportunities and stimulated the private sector to be involved in power generation business under IPP, SPP and VSPP programmes over the past decade, EGAT still plays the main role in the country’s electricity generation and still owns all high voltage transmission lines. Despite being a centralised system, not all of the needed information is publicly available from EGAT. Other sources of information were sought after to complete the picture. For this purpose, the electricity generation system in the Thailand is divided into four groups as follows:

1). Electricity Generating Authority of Thailand (EGAT) and Ratchaburi Power Plants; 2). Independent Power Producers (IPPs); 3). Small Power Producers (SPPs); and 4). Very Small Power Producers (VSPPs).

The information of each can be obtained from different sources and it is describe below. Electricity Generating Authority of Thailand (EGAT) and Ratchaburi Power Plants The information on national electricity generation is obtained from Electric Power in Thailand 2005 (DEDE, 2006) consisting of the generation from EGAT, including hydro power, and Ratchaburi power plants.

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 40 Independent Power Producers (IPPs) According to the latest information sheet (as of February 2007) of IPPs from Energy Policy and Planning Office (EPPO), Ministry of Energy, there have been 4 IPP power plants in commercial operation since the programme was first awarded as shown in Table A3-1. Table A3-1 IPP Awards (status as of February 2007) Company Fuel used Capacity (MW) Commercial in

operation date Eastern Power & Electricity Co., Ltd. Natural gas 350 25 March 2003 Glow IPP Co., Ltd. Natural gas 713 31 January 2003 Independent Power (Thailand) Co., Ltd. Natural gas 700 15 August 2000 Tri Energy Co., Ltd. Natural gas 700 1 July 2000 Source: Energy Policy and Planning Office, 2007. Small Power Producers (SPPs) According to the latest information sheet (as of February 2007) of SPPs, also from EPPO, there have been 70 SPP power plants in commercial operation since the programme started. They can be categorised based on the type of fuel and the type of contract as shown in Table A3-2. Table A3-2 SPP Awards by fuel types (status as of February 2007)

Contract type Capacity sale to EGAT (MW) Fuel type Total plants Firm Non-firm Firm Non-firm Total

Natural gas 21 19 2 1,413 47.2 1,460.2 Coal & lignite 7 5 2 370 14 384 Fuel oil 1 1 - 9 - 9 Renewables1 41 11 30 223.6 178.3 401.9 Total 70 36 34 2,015.6 239.5 2,255.1 Source: Energy Policy and Planning Office, 2007. Note: 1 Renewable resources include paddy husk, black liquor, wood chips and bark, bagasse and waste. Very Small Power Producers (VSPPs) According to the latest information sheet (as of February 2007) of VSPPs, also from EPPO, there have been 14 VSPP power plants in commercial operation since the programme started. Fuel types used in the VSPP power generation are renewables including animal waste, rice husk, straw, wastewater, domestic waste and FFB (Fresh Fruit Bunch). Since the data of individual VSPP plant is unavailable and the total sale capacity up to the end of 2005 is 8.12 MW which is accounted for only 0.03% of the 2005 national grid installed capacity (26,269 MW), the VSPP generation will be excluded from the grid baseline emission factor for simplicity. Total National Grid Generation

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 41 The national grid generation is reported by Energy Policy and Planning Office (EPPO), Ministry of Energy, in Electricity Statistics which can be located in EPPO website. Table A3-3 demonstrates the national grid generation by energy sources in 2001-2005, excluding electricity imports. Table A3-3 National grid generation by energy source, 2001-2005 (GWh)

Year Hydro Fuel oil Coal & lignite

Natural gas

Diesel oil Others1 SPP & VSPP2

Total

2001 6,303 2,626 17,722 63,537 253 2 13,514 103,957

2002 7,471 2,616 16,652 69,538 168 2 13,514 109,961

2003 7,299 2,941 16,807 76,332 180 2 13,514 117,075

2004 6,040 7,138 17,993 80,489 551 2 13,514 125,727

2005 5,798 8,244 18,334 85,703 414 2 13,514 132,009 Source: Electric Power in Thailand 2005 (DEDE), Table 17, p. 21. Note: 1 ncluding geothermal, solar cell and wind turbine, etc.

2 Generated from renewable and conventional energy. Default Values The list of default values and it sources is shown in Table A3-4. Table A3-4 List of default values

Net Calorific Value (NCV)1 CO2 emission factor2 Fuel type TJ/unit 103 Btu/unit (kg CO2/TJ)

Natural gas (dry) 1.02 - 56,100 Fuel oil 39.77 - 77,400 Lignite 10.47 - 101,000 Diesel oil 36.42 - 74,100 Imported coal3 26.37 25,000,000 94,600 Notes: 1 Adopted from Electric Power in Thailand 2005 (DEDE), p.41. The value of Lignite is based on Mae Moh site for

conservativeness. 2 Adopted from Revised 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Table 2.3, p.2.18-2.19

(including oxidation factors assumed to be 1). 3 Choose Other Bituminous Coal for conservativeness, from Revised 2006 IPCC Guidelines for National Greenhouse

Gas Inventories, Table 2.3, p.2.18-2.19. METHOD USED The tool has specified 6 steps for baseline methodology procedure:

STEP 1. Identify the relevant electric power system. STEP 2. Select an operating margin (OM) method. STEP 3. Calculate the operating margin emission factor according to the selected method. STEP 4. Identify the cohort of power units to be included in the build margin (BM). STEP 5. Calculate the build margin emission factor. STEP 6. Calculate the combined margin (CM) emissions factor.

Step 1. Identify the relevant electric power system

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 42 In order to calculate emission factor, the geographic and system boundaries must be clearly identified. Since there is only one grid electricity system in Thailand, the system boundary is identified as Thailand national electricity grid, including electricity imports from neighbouring countries. According to the tool, for imports from connected electricity systems located in another host country(ies), the emission factor is 0 tons CO2 per MWh. Step 2. Select an operating margin (OM) method As mentioned earlier, there are four options for the calculation of operating margin emission factor. The availability of data and electricity generation system are to justify the choice used. According to the tool, any of the four options can be used, but in this project a Simple OM will be used based on availability of data. However, the Simple OM method can only be used where low-cost/must-run (LC/MR) resources constitute less than 50% of the total grid generation in average of the five most recent years or based on long-term averages for hydroelectricity production. The low-cost/must-run resources typically include hydro, geothermal, wind, low-cost biomass, nuclear and solar generation. According to data reported by EPPO (2007), Table A3-5 shows that the LC/MR resources constitute less than 20% of total national grid generation. Table A3-5 Total grid generation by energy sources, 2001-2005

Electricity generation by energy source (GWh) LC/MR Year Hydro Fuel oil Coal &

lignite Natural

gas Diesel

oil Others1 SPP &

VSPP2

Total GWh %

2001 6,303 2,626 17,722 63,537 253 2 13,514 103,957 19,819 19.06 2002 7,471 2,616 16,652 69,538 168 2 13,514 109,961 20,987 19.09 2003 7,299 2,941 16,807 76,332 180 2 13,514 117,075 20,815 17.78 2004 6,040 7,138 17,993 80,489 551 2 13,514 125,727 19,556 15.55 2005 5,798 8,244 18,334 85,703 414 2 13,514 132,009 19,314 14.63

5-year average 17.22 Source: Electric Power in Thailand 2005 (DEDE), Table 17, p. 21. Note: 1 including geothermal, solar cell and wind turbine, etc.

2 Generated from renewable and conventional energy. 3 LC/MR is included generation from SPP and VSPP generated from conventional energy due to a lack of detailed information

It should be noted that although, information on load duration curve is not available to estimate the number of hours that LC/MR resources are on the margin, it will not be unreasonable to assume that LC/MR resources have never been on the margin given such a low proportion of LC/MR resources. In this case, the proportion of time that LC/MR resources is on the margin (λ) will be zero and Simple Adjusted OM will be equal to Simple OM. Therefore, the Simple OM method shall be selected to calculate the operating margin emission factor in this study. STEP 3. Calculate the operating margin emission factor according to the selected method. As stated above, the Simple OM method shall be used to calculate the baseline emission factor of Thailand due to the availability of data and the characteristic of the national power system which combined less than 50% of renewable-fuelled generating sources (see Table A3-5).

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 43 The Simple OM emission factor is calculated as the generation weighted average emissions per electricity unit (tCO2/MWh) of all generating sources serving the system, not including low-operating cost and must-run power plants. The calculation is a 3-year average based on the most recent statistics available at the time. The formula used is shown below.

(1) where:

- FCi,m,y is the amount of fuel i (in a mass or volume unit) consumed by relevant power sources m in year(s) y;

- EGm,y is the electricity (MWh) delivered to the grid by source m. - NCVi,y is the net calorific value (energy content) per mass or volume unit of a fuel i; - EFCO2,i,y is the CO2 emission factor per unit of energy of the fuel i.

Table A3-6 demonstrates the CO2 emission coefficient of each fuel type computed from the default values shown in Table A3-4. Table A3-6 CO2 emission coefficient of each fuel type Fuel Type Unit CO2 emission coefficient i COEFi tCO2/unit Natural gas (dry) mmscf 57 Fuel oil m litres 3,078 Lignite k tonnes 1,057 Diesel oil m litres 2,699 Imported coal k tonnes 2,495 Table A3-7 shows the CO2 emission from each fuel type generated from the system during 2003-2005. According to the methodology, electricity imports from other countries should be included in the calculation with 0 tCO2/MWh, whereas electricity exports should not be subtracted. Table A3-7 CO2 emissions and OM emission factor of grid electricity generation, 2003-2005

Fuel usage1 Generation2 CO2 emissions3 F i,j,y GENj,y F i,j,y * COEFi,j

Fuel type

Unit MWh tCO2

2003 (excl. SPPs) Natural gas mmscf 698,132 76,332,000 39,948,509 Fuel oil m litres 696 2,941,000 2,142,426 Coal & lignite k tonnes 15,406 16,807,000 16,291,383 Diesel oil m litres 51 180,000 137,635 2003 (SPPs)


Fuel usage1 Generation2 CO2 emissions3 F i,j,y GENj,y F i,j,y * COEFi,j

Fuel type

Unit MWh tCO2

Natural gas4 mmscf 9,274,747 4,853,958 Fuel oil4 m litres 57,794 42,101 Imported coal5 k tonnes 960 2,438,539 2,394,098 Imports6 2,479,000 0 2004 (excl. SPPs) Natural gas mmscf 724,560 80,489,000 41,460,772 Fuel oil m litres 1,697 7,138,000 5,223,702 Coal & lignite k tonnes 16,537 17,993,000 17,487,381 Diesel oil m litres 120 551,000 323,847 2004 (SPPs) Natural gas4 mmscf 9,246,744 4,763,100 Fuel oil4 m litres 58,248 42,626 Imported coal5 k tonnes 955 2,426,317 2,382,099 Imports6 3,388,000 0 2005 (excl. SPPs) Natural gas mmscf 764,118 85,703,000 43,724,360 Fuel oil m litres 1,996 8,244,000 6,144,083 Coal & lignite k tonnes 16,571 18,334,000 17,523,335 Diesel oil m litres 83 414,000 223,994 2005 (SPPs) Natural gas4 mmscf 9,283,793 4,736,449 Fuel oil4 m litres 58,335 43,476 Imported coal5 k tonnes 958 2,435,354 2,390,971 Imports6 4,419,000 0

EFOM,y 0.5885 Notes: 1 Adopted from Electric Power in Thailand 2005 (DEDE), Table 19, p.23. 2 Adopted from Electric Power in Thailand 2005 (DEDE), Table 17, p.21. 3 Emissions from coal & lignite are calculated based on CO2 emission coefficient of lignite (Mae Moh) for

conservativeness. 4 The data of fuel used for SPPs plants is unavailable. The CO2 emission per unit of the same fuel in the same year is

used to calculate the emissions from SPPs plants instead. 5 Coal fired SPPs uses both lignite and imported coal. For the calculation, the higher net calorific value and lower

emission, ie imported hard coal, have been chosen to represent this group. This is conservative. 6 Adopted from Electric Power in Thailand 2005 (DEDE), Table 22, p.25. From the result in Table A3-7, the 3-year average OM emission factor of the years 2003-2005 is 0.5885. STEP 4. Identify the cohort of power units to be included in the build margin (BM). According to information obtained from DEDE (2006) and EPPO (2007) sources, the total national grid generation in 2005 equals to 132,197 GWh. However, after having listed up the power plants sorted by their in-service date, there have been 45 new power plants that account for 20% of the total system generation (26,439 GWh), the marginal plant being Thai National Power Co., Ltd. (SPP power plant)

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 45 operating since 4 October 2000. The total generation from these 45 plants in 2005 amounted to 26,816 GWh. Table A3-8 shows the list of power plants which comprise 20% of the system generation (in MWh) and that have been built most recently . Table A3-8 Newly built power plants comprising 20% of the system generation

System Generation

Accumulated System

Generation

Generator Company Fuel Used

MWh MWh

Commercial in Operation Date

SPP A.T. Bio Power Co., Ltd. Paddy Husk 129,632 129,632 21-Dec-05 SPP Asian Supireer Food Co.,

Ltd. Natural gas 5,839 135,471 04-Nov-05

SPP Ream Udom Sugar Factory Co., Ltd.

Bagasse 18,579 154,050 04-Mar-05

SPP Thai Permpoon Industry Co., Ltd.

Bagasse 10,616 164,667 02-Mar-05

SPP Sahareang Co., Ltd. Bagasse 21,233 185,900 16-Dec-04 SPP Mitr Kalasin Sugar Co.,Ltd. Bagasse 51,853 237,753 20-Sep-04 SPP Phu Khieo Bio Energy Co.,

Ltd. Bagasse, Woody bark, Paddy Husk

187,967 425,719 06-Sep-04

SPP Dan Chang Bio Energy Co.,Ltd.

Bagasse, Woody bark, Paddy Husk

175,004 600,723 01-Aug-04

SPP Singburi Sugar Co., Ltd. Bagasse 10,616 611,339 18-Jul-04 SPP New Kwang Sun Hree

Sugar Co., Ltd. Bagasse 5,308 616,648 09-Apr-04

SPP Tha Maka Sugar Co., Ltd. Bagasse 5,308 621,956 09-Apr-04 SPP New Krung Thai Sugar

Factory Co., Ltd. Bagasse 5,308 627,264 07-Apr-04

SPP Kumpawapee Sugar Co., Ltd.

Wood Chips 13,271 640,535 02-Apr-04

SPP Thai Power Supply Co., Ltd (3)

Paddy Husk, Eucalyptus

11,667 652,202 30-Mar-04

SPP Advance Agro Public Co.,Ltd. (2)

Black Liquor 162,040 814,242 02-Dec-03

SPP Advance Agro Public Co.,Ltd. (1)

Bark, wood chips, Black Liquor

324,081 1,138,322 05-Nov-03

SPP Ratchasima Sugar Factory Co.,Ltd. (2)

Bagasse 79,624 1,217,946 22-Aug-03

SPP Phuket Municipality Waste 2,654 1,220,600 23-Jun-03 SPP Roi Et Green Co., Ltd. Paddy Husk 57,038 1,277,638 29-May-03 SPP Korat Industry Co.,Ltd. (2) Bagasse 21,233 1,298,871 23-Apr-03 SPP Pranburi Sugar CO.,Ltd. Bagasse 7,962 1,306,834 02-Apr-03 IPP Eastern Power & Electric

Co., Ltd.1 Natural gas 2,627,000 3,933,834 25-Mar-03

SPP Buri Ram Sugar Co., Ltd. Bagasse 21,233 3,955,067 01-Mar-03 SPP Mitr Kaset Industry Co.,

Ltd. Bagasse 7,962 3,963,029 11-Feb-03

IPP Glow IPP Co., Ltd.1 Natural gas 4,646,000 8,609,029 31-Jan-03


System Generation

Accumulated System

Generation

SPP TLP Cogeneration Co., Ltd. Natural gas 388,897 8,997,926 28-Jan-03 SPP Thai Rungruang Industry

Co., Ltd. Bagasse 10,616 9,008,542 21-Jan-03

SPP PRG Granary Co., Ltd. Paddy Husk 13,271 9,021,813 13-Dec-02 IPP Ratchaburi Steam Turbine

Block 3 Unit 1 Natural gas 1,802,731 10,824,544 01-Apr-02

SPP Pisanulok Sugar Co., Ltd. Bagasse 10,616 10,835,160 25-Mar-02 SPP Saraburi Sugar Co., Ltd. Bagasse 21,233 10,856,393 04-Jan-02 SPP Kanchanaburi Sugar

Industrial Co., Ltd. Bagasse 10,616 10,867,010 03-Jan-02

EGAT Krabi Thermal Fuel oil 1,145,000 12,012,010 01-Jan-02 SPP Amata Power Co., Ltd.

(Bangpakong) Natural gas 583,345 12,595,355 28-Sep-01

SPP Bio-Mass Power Co.,Ltd. Paddy husk 32,408 12,627,763 09-Sep-01 SPP Laem Chabang Power Co.,

Ltd. Natural gas 388,897 13,016,660 16-Jul-01

IPP Ratchaburi Steam Turbine Block 2 Unit 1

Natural gas 1,802,731 14,819,391 01-Jul-01

IPP Ratchaburi Steam Turbine Block 1 Unit 1

Natural gas 1,802,731 16,622,122 01-Mar-01

SPP Eastern Sugar Co., Ltd. Bagasse 21,233 16,643,355 20-Feb-01 IPP Ratchaburi Gas Turbine

Block 3 Unit 2 Natural gas 1,564,634 18,207,989 01-Jan-01

IPP Ratchaburi Gas Turbine Block 3 Unit 1

Natural gas 1,564,634 19,772,624 01-Dec-00

IPP Ratchaburi Gas Turbine Block 2 Unit 2

Natural gas 1,564,634 21,337,258 01-Nov-00

IPP Ratchaburi Thermal Unit 2 Natural gas 4,312,000 25,649,258 01-Nov-00 SPP Nong Khae Cogeneration

Co., Ltd. Natural gas 583,345 26,232,603 12-Oct-00

SPP Thai National Power Co., Ltd.

Natural gas 583,345 26,815,948 04-Oct-00

Source: http://www.eppo.go.th/power/data/index.html (files: IPP_Feb07.xls, SPP_Feb07.xls, VSPP_Feb07.xls) Note: The generation from the VSPPs is excluded for simplicity (total maximum sale capacity = 8 MW or 0.03% of total grid

generation in 2005) STEP 5. Calculate the build margin emission factor. The build margin (BM) emission factor is calculated as the generation-weighted average emission factor (tCO2/MWh) of a sample of power plants which comprise 20% of the system generation (in MWh) and that have been built most recently, or 5 power plants that have been built most recently, whichever is greater. Since the generation of 5 power plants that has been built most recently (all of them SPPs) only constitutes a very small proportion of the system generation, the 20% benchmark is opted for calculating BM emission factor. The formula used is somewhat similar to the one for OM emission factor as shown below.


(12) where EFEL,m,y and EGm,y are analogous to the variables described for the simple OM method above for plants m. The calculation of BM emission factor is conducted based on the latest year of which data is accessible (2005). The BM emission factor of the grid generation system equals to 0.4488 as shown in Table A3-9. Table A3-9 BM emission factor in 2005

Fuel usage Generation CO2 emissions F i,m,y GENm,y F i,m,y * COEFi,m

Generator

Fuel type

Unit MWh tCO2

EGAT Hydro - 0 0 Fuel oil1 m litres 271 1,145,000 833,642 IPP Natural gas1 mmscf 173,158 21,687,097 9,908,445 SPP Natural gas - 2,533,668 1,292,639 Biomass - 1,450,184 0

EFBM,y 0.4488 Note: 1 Amount of fuel usage and generation are Adopted from Electric Power in Thailand 2005 (DEDE), p. 10, 22, 42 STEP 6. Calculate the combined margin (CM) emissions factor The last step is to calculate the baseline emission factor (EFy) as the weighted average of the OM and BM emission factors. BMBMOMOMy EFwEFwEF ⋅+⋅= (10)

where the weights wOM and wBM, by default, are 50% as stated in tool to calculate the emission factor for an electricity system. The baseline emission factor of Thailand’s national electricity system is 0.5187 as shown in Table A3-10. Table A3-10 Baseline emission factor of Thailand’s national electricity system in 2005 Weight Emission Factor OM 0.5 0.5885 BM 0.5 0.4488

Baseline (Combined Margin) 0.5187 CONCLUSION

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 48 The baseline emission factor is obtained from 50% weighted average of the operating margin (OM) and build margin (BM) emission factors. In calculating the OM emission factor, the Simple OM method is selected due to limited information available at the time. The OM emission factor is the generation-weighted average emissions per electricity unit (tCO2/MWh) of all generating sources serving the system, not including low-operating cost and must-run power plants, on an average of 3 most recent years where the data is accessible. The BM emission factor is calculated as the generation-weighted average emission factor (tCO2/MWh) of a sample of power plants which comprise 20% of the system generation (in MWh) and that have been built most recently. The results show that the 3-year average OM emission factor of the years 2003-2005 is 0.5885 and the BM emission factor of 2005 equals to 0.4488. Therefore, the baseline emission factor of the country’s electricity system, on 50% weighted average of both emission factors, is 0.5187.


Annex 4

MONITORING INFORMATION


Annex 5

PROJECT FINANCIAL ANALYSIS Feasibility AnalysisProject Title: TPI Polene Power Waste Heat Recovery Power Plant Pr ojectCompany Name: TPI Polene Power Co., LtdSheet Title: Assumption

1. Installed capacity 36 MW2. Project lifetime 20 years3. Exchange rate 35 Baht/USD4. Total Project Investment 1,671,452,650 Baht4.1 Engineering Purcurement and construction for WHRP 36MW 1,210,710,000 Baht4.2 Supplementary Utility Project Costs and land 460,742,650 Baht5. Peak period defined by Provincial Electricity Authority (PEA) - Peak Time/ 09.00 - 22.00 3,264 hours/year - Off Peak Time/ 22.00 - 09.00 5,496 hours/yearTotal 8,760 hours/year6. Average kiln running days 300 days/year Average kiln running factor 82%7. Expected waste heat power plant running factor 90% of kiln running factor8. Expected waste heat power plant running hours - Peak Time/ 09.00 - 22.00 2,414 hours/year - Off Peak Time/ 22.00 - 09.00 4,066 hours/year Total 6,480 hours/year8. Gross generation capacity (peak time) 32.0 MW Gross generation capacity (off-peak time) 28.0 MW(Maximum waste heat provided during peak because the raw mill plant, which consume some of the waste heat, is not running during peak time)9. Internal consumption capacity 2.86 MW10. Gross electricity generation (peak time) 77,263 MWh Gross electricity generation (off-peak time) 113,835 MWh Total gross generation 191,098 MWh11. Net electricity generation (peak time) 70,367 MWh Net electricity generation (off-peak time) 102,224 MWh Total net generation 172,591 MWh12. Electricity price 2.40 Baht/kWh13. Electricity revenues 414,218,359 Baht/year14. Raw Material + Utilities + Operation & Maintenance Costs - Cost of chemical use 60 Baht/MWh Total chemical expense 11,465,872 Baht/year - Raw water cost 6.0 Baht/m3 Water consumption rate 8,000 m3/day Total water expense 12,960,000 Baht/year - Operation and Maintenance costs 7.0% of project investment/year Total O&M expense 117,001,685 Baht/year - Insurance premium rate 0.10% of project investment/year Insurance premium 1,671,453 Baht/yearTotal O&M cost 143,099,010 Baht/year15. Interest rate 7.50% pear year

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03 .1. CDM – Executive Board page 51 Feasibility AnalysisProject Title: TPI Polene Power Waste Heat Recovery Power Plant Pr ojectCompany Name: TPI Polene Power Co., LtdSheet Title: IRR-base case

year2009 (BHT)Items/ Year 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Cash In FlowElectricity revenues - 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 Total Cash In Flow - 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359 414,218,359

Cash Out Flow Investment CostTurn-Key : Plant & Machinery/ Civil, Erection Construction Works/ Operation & Maintenance start up

1,210,710,000

Interest during construction - Supplementary Project Cost 460,742,650 Total Investment Cost 1,671,452,650

Operating CostsChemical use 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 11,465,872 Utilities 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 12,960,000 Operation & Maintenance Costs 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 117,001,685 Insurance 0.10% p.a. 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 1,671,453 Total Operating Costs 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010 143,099,010

Net Operation Profit 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 271,119,349 Less : Income Tax 30% 30% 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 81,335,805 Net Operation Profit After Tax 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545

Net Cash Flow after tax -1,671,452,650 189,783,545 189 ,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545 189,783,545discount rate 7.50%p.a.

IRR of Project (after tax) without CERs 9.51% p.a.

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