PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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

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SECTION A. General description of project activity

A.1. Title of the project activity:

Project title: Dechang Xinma 120 MW Hydropower project PDD Version: 1.0 Completion date PDD: 11/08/2009

A.2. Description of the project activity:

The Sichuan Dechang Xinma 120 MW Hydropower project (hereafter referred to „ the project „ or „project‟) involves the construction of a run-of-river hydropower station at the main stream of the at Meizi Village, of Sichuan Province, , which is constructed and operated by Dechang Xinma Hydropower development Co., Ltd. The dam locates 40 km from Dechang County, The total installed capacity of the project will be 120MW and the total surface area of the reservoir at full capacity is 374,000m2 and the power density of the project is 320 W/m2.

The expected annual effective operating hour is 4,086 hours and annual power generation is about 573,960MWh. The expected annual power supply is 544,000 MWh.

The main objective of the project is to generate power from clean renewable hydropower and supply electricity to the Sichuan Province Grid while contributing to the sustainability of power generation of the Central China Grid. The scenario existing prior to the start of the project activity is the same as the baseline scenario. In absence of the project activity, electricity delivered to the grid by the project activity would have otherwise been generated by the operation of grid-connected power plants and by the addition of new generation sources.

The electric power will be supplied to the Central China Grid via Sichuan Province Grid. The power generated by the project will replace the same amount of the electric power in Central China Grid which is predominantly based on coal-fired thermal power plant and therefore the anthropogenic emissions will be reduced and achieve the goal of emission reduction. The estimated annual CERs will be 463,923 tCO2.

As a renewable energy project, development of the project fits with the Chinese energy sector objective and will contribute to the sustainability, specifically through:

Improving the power sector, releasing the conflict between the power demand and supply and reducing the dependence on exhaustible fossil fuels for power generation; Reducing air pollution by replacing coal-fired power plants with clean, renewable power and the adverse health impacts from air pollution; Creation of employment opportunities for local residents

A.3. Project participants:

the Party involved wishes to be Name of Party involved ((host) Private and/or public entity(ies) project considered as project participant indicates a host Party) participants (as applicable) (Yes/No) Dechang Xinma Hydropower development China(host) No Co., Ltd PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Switzerland Vitol S.A. No

A.4. Technical description of the project activity:

A.4.1. Location of the project activity:

A.4.1.1. Host Party(ies):

People‟s Republic of China

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

Sichuan Province

A.4.1.3. City/Town/Community etc.:

Meizi Village, Dechang County

A.4.1.4. Details of physical location, including information allowing the unique identification of this project activity (maximum one page):

Dechang Xinma 120 MW Hydropower project is located at the main stream of Anning river at Dechang county of Sichuan Province. It is 40 kilometres away from Dechang County. The power house approximate coordinates is 27°11'38.52"N, 102°11'38.52"E. Figure A.1 shows the location of the project.

Figure A.1: Map of the project location

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Sichuan Dechang Xinma 120 MW Hydropower project Meizi Village, Dechang County, Sichuan Province L atitude: 27°11'38.52"N L ongitude: 102°11'38.52"E

A.4.2. Category(ies) of project activity:

The project activity falls within Sectoral Scope 1: Energy Industries. - Electricity generation from renewable energy (hydropower)

A.4.3. Technology to be employed by the project activity:

The main objective of the project is to generate power from clean renewable hydropower and supply electricity to the Sichuan Province Grid while contributing to the sustainability of power generation of the Central China Grid. The scenario existing prior to the start of the project activity is the same as PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

CDM – Executive Board page 5 the baseline scenario. In absence of the project activity, electricity delivered to the grid by the project activity would have otherwise been generated by the operation of grid-connected power plants and by the addition of new generation sources.

Coal-fired power generation is currently the dominant power supply option within the Central China Grid. Generation data within the Grid are published by Chinese authorities through the Electric Power Yearbook and the Energy yearly. By displacing coal-fired power generation with clean renewable energy, the project leads to the reduction of CO2 emissions into the atmosphere. In accordance with the applied methodology, the greenhouse gasses accounted for are CO2 emissions from electricity generation in fossil fuel fired power plants that is displaced due to the proposed project activity, the CH4 emissions from the reservoir and the CO2 emission from the backup power generation.

This project generates electricity by using renewable hydropower and the energy transformation process, the proposed newly built equipment and system, the variables need to be monitored and the layout of the monitoring equipment of the project is shown in Figure B.1.

The project is run-of-river style hydropower station, the pivot consists of 14 m non-overflow dam, 21,281 m water division tunnel, pressure forebay, penstock, power house and switch station. The surface area of the reservoir at full capacity is 374,000 m2, the power density is 320 W/m2.

The project will be connected to Yonglang 220 kV transformer station via an on-site 10.5/110kV booster substation and then connects to Sichuan Provincial Grid while the Sichuan Provincial Grid is part of the Central China Grid.

The project will install 3 generator sets with an individual capacity of 40 MW. The specific technical data of the turbines / generators are listed in Table A.2. The turbine/generator units are manufactured by Sichuan Dongfeng Electric Machinery Works Co., Ltd.

Turbines (The type and data Type number HLA743-LJ-230 of the 3 turbine units are the Max water head 109.97 m same ) Nominal water head 92.00 m Mini water head 90.56 m Nominal flow 48.8 m3/s Nominal power 40 MW Nominal rotation 333.3 r/min Runaway speed 486 r/min

Generators (the type and data Type number SF40-18/5000 of the 3 generators are the Nominal voltage 10.5 KV same) Power factor 0.85 Nominal power 40 MW Nominal rotation 333.3 r/min

The proposed project will use domestic turbine and auxiliary devices, which will apply domestic technology, so it does not relate to technology transfer.

The spatial boundary of the proposed project involves the project itself and the power plants connected to the Central China Grid.

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Implementation schedule:

An indicative schedule of the project‟s implementation is provided in table A.3 including the main past and future events of construction.

Table A.3 Implementation schedule of the proposed project

Period / date Main activity February,2007 Start of construction activities October,2007-June,2009 Construction of the dam January,2008-November,2009 Construction of the powerhouse May,2009-December,2009 Installation of the two turbines and generator units. December,2009-January,2010 Commissioning of the turbines and generator units. January,2010 Construction of the dam optimization design change

Staff training:

Ten people will have three-month training, after the training and get the certification, the ten people will join the operation of the hydropower station. Meanwhile, five experienced persons from other hydropower stations will be appointed as the group manager.

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

A 7×3 year renewable crediting period is selected for the proposed project activity and the estimation of the emission reductions are indicated in the following table. The annual average emission reductions in the first crediting period (from June 2011 to May 2018) are 463,923 tCO2e and the total emission reductions amount to 3,247,461tCO2e.

The estimation of annual Year emission reductions (tCO2e) 01/06/2011- 31/05/2012 463,923 01/06/2012- 31/05/2013 463,923 01/06/2013- 31/05/2014 463,923 01/06/2014- 31/05/2015 463,923 01/06/2015- 31/05/2016 463,923 01/06/2016- 31/05/2017 463,923 01/06/2017- 31/05/2018 463,923

Total estimated reductions (tonnes of CO2e) 3,247,461 Total number of crediting years in 1st crediting period 7 Annual average over the 1st crediting period of estimated 463,923 reductions (tonnes of CO2e)

A.4.5. Public funding of the project activity:

There is no public funding from Annex I countries available to the proposed project.

SECTION B. Application of a baseline and monitoring methodology

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B.1. Title and reference of the approved baseline and monitoring methodology applied to the project activity:

Approved consolidated baseline and monitoring methodology ACM0002 (Version 10): Consolidated baseline methodology for grid-connected electricity generation from renewable sources (approved on 47th CDM-EB conference)

This methodology draws upon the following tools: . Tool for the demonstration and assessment of additionality (version 05.2) . Combined tool to identify the baseline scenario and demonstrate additionality (version 02.2) . Tool to calculate the emission factor for an electricity system (version 01.1) . Tool to calculate project or leakage CO2 emissions from fossil fuel combustion (Version 02)

For more information on the baseline and monitoring methodology we refer to the UNFCCC website: http://cdm.unfccc.int/methodologies/PAmethodologies/approved.html

B.2. Justification of the choice of the methodology and why it is applicable to the project activity:

The baseline and monitoring methodology ACM0002 (version 10) is applicable to the proposed project, because the project meets all the applicability criteria for newly-constructed hydro power station project in the methodology:

 The proposed project will utilize renewable energy source for power generation and it is a grid- connected renewable power generation project.  The project is a newly-constructed hydro power station;  The project activity results in new reservoir and the power density of the power plant is 320W/ m2 which is greater than 4 W/m2.  The geographic and system boundaries for the relevant electricity grid, the Centre China Power Grid, can be clearly identified and information on the characteristics of the grid is available.  The project does not involve an on-site switch from fossil fuels to a renewable source.

B.3. Description of the sources and gases included in the project boundary:

The spatial extent of the project boundary includes the project power plant and all power plants connected physically to the Central China Grid that the proposed project is connected to.

In accordance with “Tool to calculate the emission factor for an electricity system (version 01.1)” for the definition of district power grid for big counties and the affiche issued by Chinese CDM Designated National Authority(DNA), the district power grid for the proposed project is the Central China Grid, which includes Henan, Hunan, Hubei, Jiangxi, Sichuan and Chongqing provincial grids.

Sources and gases included in the project boundary are described in Table B.1 as below:

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Table B.1 Inclusion of gases and sources in the calculation of the emission reductions

Source Gas Included? Justification / explanation

CO2 Yes Main emission source

Central China Grid CH4 No Ignore, this is conservative

Baseline N2O No Ignore, this is conservative

CO2 No Ignore. The power density of the project is 320 W/m2 which is For hydro power plants, CH Yes greater than 10W/m2. emissions of CH from the 4 4 reservoir N2O No

Project Activity

Figure B.1. Flow diagram of the project boundary

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APJ Reservoir CH4

Dam

Water diversion structure

Turbine CAPpj Generator

TEGy

Internal consumption

On-site Project activity Transformer Station

EGfacility

Power Grid CO2 Project boundary

Flow of water Monitoring variables

Flow of electricity Emission sources and gases included in the project boundary

B.4. Description of how the baseline scenario is identified and description of the identified baseline scenario:

The Xinma Hydropower Station Project is the installation of a new grid-connected renewable power plant. Therefore, the baseline scenario is identified in the methodology and defined as:

Electricity delivered to the grid by the project activity would have otherwise been generated by the operation of grid-connected power plants and by the addition of new generation sources, as reflected PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

CDM – Executive Board page 10 in the combined margin (CM) calculations described in the “Tool to calculate the emission factor for an electricity system”.

The baseline scenario boundary of the Project is the China Central Grid, so the project boundary for calculating EF OM and EF BM will be limited to the China Central Grid, see detail information about China Central Grid in step 1 of section B.6.1.

In conclusion, the baseline scenario of the Project is the provision of equivalent amount of electricity by the China Central Grid. The GHG emission reduction as a result of the project activity will be calculated based on EF OM and EF BM of the China Central Grid and the amount of annual feed-in electricity supplied by the Project.

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 activity is demonstrated using the steps described in the „Tool for the demonstration and assessment of additionality‟ (version 05.2). See UNFCC website: http://cdm.unfccc.int/methodologies/PAmethodologies/AdditionalityTools/Additionality_tool.pdf

Step 1. Identification of alternatives to the project activity consistent with current laws and regulations

Sub-step 1a: Define alternatives to the project activity

The methodology requires a number of sub-steps to provide realistic and credible alternatives to the project activity. There are only a few alternatives that are prima facie realistic and credible in the context of the Central China Power Grid: Fossil fuel-fired power generation Power generation from wind or other renewable energies The proposed hydropower activity, without the support of CDM The same service of power supply provided from grid (continuation of the present situation)

These alternatives are in accordance with the description of the methodology (the additionality tool requires that the proposed project activity be included as an alternative, without the benefit from CDM).

Coal-fired power generation is the dominant power supply option in China. In the case of the Central China Power Grid, both coal-fired power generation and hydropower are common options. In 2007, coal-fired power accounted for 64.5% of total power generation and Hydropower accounted for 35.4% of power generation.1

There are no enough wind sources, wave and tidal sources or geothermal sources in the project site. No Biomass sources power plant with a similar scale to the Project has previously been built in same

1 China Electrical Power Yearbook 2008,p733 PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

CDM – Executive Board page 11 area2. Moreover, other renewable energy, such as solar PV, are suffered with high cost that not commercially viable in China at present. Therefore, alternative 2 is not feasible.

Sub-step 1b: Enforcement of applicable laws and regulations

According to relative national laws and regulations, construction of new thermal power units with a capacity under 135 MW is prohibited for provincial grid or regional grid such as Central China Grid. (see General Office of the State Council (2002), Notice of the General Office of the State Council concerning the Strict Prohibition of the Construction of Thermal Power Units with a Capacity of 135MW or Below, Guo Ban Fa Ming Dian [2002] Document No.6.) .Therefore, the scenario 1 is not feasible alternative and it is excluded.

The proposed project activity is consistent with national policies for environmental protection, energy conservation and sustainable development. However, there are no binding legal and regulatory requirements for this project type. The Renewable Energy Law adopted by the National People‟s Congress on 28 Feb. 2005 encourages and supports renewable-based power generation, but does not stipulate specific goals for local air quality improvement.

Conclusion: We conclude that alternatives 3 and 4 are compliance with the relevant Chinese laws and regulations. As there are alternatives to the project activity that are in compliance with the relevant Chinese laws and regulations, the project may be additional.

Step 2. Investment analysis

Sub-step 2a: Determine appropriate analysis method

The analysis will be analyzed through Option III of the additionality tool, i.e. benchmark analysis. This method is applicable because:

. Option I: Simple cost analysis, does not apply as the project generates economic returns through the sales of electric power to the grid. . Option II: Investment comparison analysis is not used as the project entity is not considering investing in the construction of one of the other identified alternatives. . Option III: Benchmark analysis is used as the return on investment relative to the industry benchmark was crucial for the decision to go ahead with the project.

Conclusion: We conclude that option III is applicable to the project activity.

Sub-step 2b ― Option III: Apply benchmark analysis.

The project faces a barrier to implementation due to the poor returns on investment. To illustrate this, we performed a benchmark analysis in which we calculate the Internal Rate of Return (IRR) of the project and compare the result with the benchmark set in the Preliminary Design Report.

In accordance with “The Preliminary Design Report of Sichuan Dechang Xinma 120 MW Hydropower project” the IRR benchmark is 8%.

Sub-step 2c: Calculation and comparison of financial indicators

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(1) Basic parameters for calculation of financial indicators

For the calculation of the IRR on total investment for the proposed hydropower project we list the parameters in Table B.2. The series of data are all from the Preliminary Design Report on Sichuan Dechang Xinma 120 MW Hydropower project

Table B.2 Parameters used in the calculation of the IRR on total investment

Item Data Unit Data source

Installed capacity 120 MW Preliminary Design Report Total investment 1,087,663,400 RMB Preliminary Design Report VAT 17% Preliminary Design Report

Urban Maintenance 5% Preliminary Design Report and Construction Tax

Extra charges for 3% Preliminary Design Report education

Total Loan interest 512,396,600 RMB Preliminary Design Report

3 Estimated annual 560,793,358 kWh Preliminary Design Report power supply Power price (include 0.288 RMB/kWh Standard published price in Sichuan VAT) Province at the time of investment decision

O&M cost 29,464,400 RMB Preliminary Design Report Lifetime of the project 35 Years Preliminary Design Report

Depreciation 1,148,136,600 RMB Preliminary Design Report

Investment horizon 35 Year Preliminary Design Report Income Tax 33% Preliminary Design Report Baseline grid emission 0.8528 tCO2/MWh Calculated factor

Assumed CER price 8.2 EUR/tCO2e Market price

Exchange rate 9.954 RMB/EUR www.xe.com

(2) Comparison of IRR for the proposed project and the financial benchmark

In accordance with the benchmark analysis (Option III), the proposed project will not be considered as financially attractive if its financial indicators (i.e. IRR for full investment) are lower than the benchmark rate.

Table B.3 summarizes the main results of the calculations.

Table B.3 Main calculation results of the IRR for full investment calculations

3 For Conservative IRR calculation, the Estimated annual power supply here was calculated by Annual power generation*(1-2%)*(1-0.3*). 2% and 0.3% represent internal power use rate and line loss rate. PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Financial indicators IRR without CDM revenues 6.77% Benchmark 8% IRR with CDM revenues 10.18%

Without the revenues from the sale of CERs, the IRR is 6.77%, below the benchmark of 8%. With CDM revenues and reasonable price, the IRR is over 8%. From the calculation, it is concluded that the project is economically and financially unattractive. While there is CDM revenue, the project is financially attractive, so CDM revenue is an essential condition to make the project more attractive.

Sub-step 2d: Sensitivity analysis

The tool for the demonstration and assessment of additionality requires that a sensitivity analysis is conducted to check whether, under reasonable variations in the critical assumptions, the results of the analysis remain sufficient. In case of the project, we change the following parameters to execute the sensitivity analysis: - Total investment cost - Annual O&M costs - Grid tariff - Net power supply to the grid

In the sensitivity analysis, variations of ±10% have been considered in the critical assumptions. Such variation is considered appropriate as it is consistent with the approach taken by the official Chinese Standard document “Interim provisions concerning hydropower construction project financial assessment” and in accordance with the general guidance provided by the “Document for Registered Engineering Consultants in China”, published by the China Planning Press under the supervision of the National Development & Reform Commission.

Moreover, as stated in sub-step 2c, investment costs and O&M costs are expected at minimum to increase in accordance with inflation, but are unlikely to decrease considering the growth rate of the Chinese economy. Grid price is determined and controlled by the Chinese Government and adjusted periodically only to correct for inflation. Operating hours are equal to the power generation divided by the fixed installed capacity. Power generation has been calculated based on historical flow data including up to 46 years of water flow statistics and the fixed water head available at the location; therefore a variation exceeding the ±10% range selected in this PDD is not considered realistic. Table B.5a summarizes the results of the sensitivity analysis, while Figure B.4b provides a graphic depiction.

Table B.4a. Results of the sensitivity analysis – impact of variations in critical assumptions on IRR. Sensitivity analysis of IRR without CDM -10% -5% 0% 5% 10% Total investment cost 7.22% 6.99% 6.77% 6.55% 6.33% Net power supply to the grid 5.85% 6.32% 6.77% 7.21% 7.63% Grid tariff 5.85% 6.32% 6.77% 7.21% 7.63% Annual O&M cost 6.96% 6.86% 6.77% 6.67% 6.58%

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Figure B.4b. Results of the sensitivity analysis

From Table B.4a and Figure B.4b, we can see that with the variation of four uncertain factor within the range of 10%, the IRR of the project without the revenues from the sale of CERs varies at different degree but it remains below the 8% benchmark. It is clear that without CDM revenue, the project is not financial attractive.

Step 4. Common practice analysis

Sub-step 4a. Analyze other activities similar to the proposed project activity: The project is located in Sichuan province, we choose projects that in Sichuan Province, constructed since 2002, with capacity between 50-300MW, these projects are provided as the Table B5.

Table B.5 Hydropower stations with a capacity between 50-300MW constructed since 2002 in Sichuan Province Name of hydropower station Capacity Start Location Developer Construction Waner Hydropower Station4 66 MW 2004 State owned5 Wan Ba He first stage Hydropower 69 MW 2003 State owned6 Station

Sub-step 4b: Discuss any similar options that are occurring:

4 The name of this station has changed to Yulong Hydropower station. 5 http://7j.sinohydro.com/Article_Class.asp?ClassID=23 6 http://www.shimian.gov.cn/jrsm/smxw/2007-01-17/jrsm_142.html PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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We can see that two projects that meet the above criteria: The Waner Hydropower Station and Wang Ba He first stage Hydropower Station. They are developed by State-owned enterprises. Hydropower stations which are developed by state-owned enterprises have higher capital reserves and operational capacity to allow them better and easier access to project finance. State-invested organizations therefore can better manage the project risks and have stronger negotiating power with the grid companies. They chose the places where are rich in water resources, and easy to feed in the Central China Grid. Therefore, projects listed in Table B.5 are not comparable to the proposed CDM project activity in terms of access to financing or returns on investment.

In conclusion of above mentioned analyze, the project is not a baseline scenario, the project is additional.

Impact of CDM registration

Registration of the project as a CDM project would result in additional revenues for the project, significantly improving the economic attractiveness of the project. This is the most important contribution of CDM to the project realization, removing the crucial barrier towards its realization. The income through CDM will raise the IRR for the project from 6.77% to 10.18%, which is above the 8% benchmark.

The project entity was aware of the CDM incentive before signed the construction contract (Jan. 16th 2007) which was identified as the start of project activity. This can be evidenced by the fact that the Board resolution issued in 6th Jan. 2006 about CDM financing is considered as a key factor in the investment decision

Table B.6. Timeline of CDM consideration

Date Key events Evidence Nov. 2005 The final Preliminary Design Report is published PDR Dec. 28th 2005 The project entity is informed of the possibility of CDM Fax financing by the Design Institute Jan. 6th 2006 Board meeting in which CDM was considered as a key Board meeting resolution factor in the investment decision Jun. 2006 Environmental Impact Assessment report is published EIA report Aug. 22nd 2006 An exclusivity agency agreement is signed with R&J Agency agreement International to identify CER buyer and achieve Emission Reduction Purchase Agreement. Sep. 7th 2006 Approval of EIA report. Approval Sep-Dec. 2006 R&J International collects project documentation then PIN finalizes a Project Idea Note in order to approach CER buyers. Jan.12th 2007 Government approval of the project Approval Jan. 16th 2007 Signature of the construction contract (Start of the Construction contract project activity) Feb.1st 2007 Start of construction activities Construction start order Mar. 13th 2007 The PIN is sent to potential CER buyers Email correspondence Aug. 23rd 2007 Signature of the equipment purchase contract. Contract Sep. 19th 2007 A Letter of Intent is signed between the Project Owner LoI and the CER buyer Sep 30th 2007 A first bank loan is obtained Bank Loan Contract Nov. 2007 CER buyer approaches consulting company for PDD Tender development Mar. 31st 2008 Signature of the Emission Reduction Purchase ERPA PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Agreement with Buyer Apr. 14th 2008 A CDM services agreement with regard to PDD Services Agreement development is signed with Consulting Company. Jul. 16th 2008 The construction of the powerhouse is halted due to lack Logs from Construction of finance. Supervision Company Oct. 17th 2008 The buyer suspends the CDM validation process until Notice from buyer to R&J more clarity on the financing status of the project is received and guarantee about the implementation schedule Apr. 22nd 2009 A meeting is held in between buyer, seller, Meeting Minutes from R&J R&J and consultant where it is agreed that the CDM process will be pushed forward once the bank loan is secured, which is expected within the next 2 months. It is agreed to hold a stakeholder consultation meeting. Apr. 29th 2009 A stakeholder consultation meeting is organized on-site Newspaper Announcement May 27th 2009 A second bank loan is obtained Bank loan agreement June 23rd 2009 Power house construction activities resume Logs from Construction Supervision Company 1st July 2009 Project is submitted for host country approval. Chinese http://cdm.ccchina.gov.cn/web DNA notifies the project developer. /NewsInfo.asp?NewsId=3687

B.6. Emission reductions:

B.6.1. Explanation of methodological choices:

Baseline emissions In accordance with the „ACM0002 methodology‟ (version 10), baseline emissions for the year y are calculated as:

BEy EGPJ,y EFgrid,CM,y (B.1)

Where: BEy = Baseline emissions in year y (tCO2/yr) EGPJ,y = Quantity of net electricity generation that is produced and fed into the grid as a result of the implementation of the CDM project activity in year y (MWh/yr) EFgrid,CM,y = Combined margin CO2 emission factor for grid connected power generation in year y calculated using the latest version of the “Tool to calculate the emission factor for an electricity system” (tCO2/MWh)

As the project involves the construction of a new hydropower station, EGPJ,y = EGfacility,y and formula B.1 can be expressed as:

BEy = EGfacility,y ·EFgrid,CM,y (B.2)

Where: EGfacility,y is Quantity of net electricity generation supplied by the project plant/unit to the grid in year y (MWh/yr)

For the calculation of Combined Margin CO2 emission factor, EFgrid,CM,y, the methodology refers to the „Tool to calculate the emission factor for an electricity system‟ (Version 01.1). In accordance PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

CDM – Executive Board page 17 with this tool, the baseline emission factor is calculated as a combined margin: a weighted average of the operating margin emission (OM) factor and the build margin (BM) emission factor. Both the OM and BM emission factors are calculated ex ante and will not be updated during the first crediting period.

This PDD refers to the Operating Margin (OM) Emission Factor and the Build Margin (BM) Emission Factor published by the Chinese DNA on July 2nd 2009. We will refer to these emission factors as the „published emission factors‟.

For more information on the published OM and BM emission factors, please refer to: http://qhs.ndrc.gov.cn/qjfzjz/t20090703_289357.htm

- Baseline emission factor: http://qhs.ndrc.gov.cn/qjfzjz/t20090703_289357.htm - Calculation of OM: http://qhs.ndrc.gov.cn/qjfzjz/W020090703644238739485.xls - Calculation of BM: http://qhs.ndrc.gov.cn/qjfzjz/W020090703644239079814.doc

The description below focuses on the key elements in the calculation of the published emission factors and the subsequent calculation of emission reductions. The full process of the calculation of the emission factors and all underlying data are presented in English in Annex 3 to this PDD.

Selection of values for net calorific values and CO2 emission factors of various fuels.

As mentioned above, the Chinese DNA has entrusted key experts with the calculation of the grid emission factors. In these calculations choices have been made for the values of net calorific values and CO2 emission factors. In the calculation files of the published emission factors, the net calorific values are based on the China Energy Statistical Yearbook, and the CO2 emission factors are based on IPCC 2006 default values. The following table summarizes the values used. Note that the table lists the carbon emission factor of the fuels, while the CO2 emission factor has been based on IPCC default values at the lower limit of the uncertainty at a 95% confidence interval. Rounded figures have been reported but exact figures have been used in the calculations in this PDD. The IPCC 2006 default carbon emission factors assume as a default value 100% oxidation in the combustion process. The calculation by the Chinese DNA and the calculations presented here follow the same approach by assuming complete combustion of the fuels. The „Tool to calculate the emission factor for an electricity system‟ does not take into account oxidation rates, which is equivalent to assuming 100% oxidation.

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Table B.7. Default values used for net calorific values and CO2 emission factors of fuels

Fuel Unit NCV CO2 emission factor

(TJ/unit) (TCO2e/TJ) Raw coal 104 Tons 209.08 87,300 Clean coal 104 Tons 263.44 87,300 Other washed coal 104 Tons 83.63 87,300 Briquettes 104 Tons 209.08 87,300 Coke 104 Tons 284.35 95,700 Coke oven gas 108 m3 1,672.60 37,300 Other gas 108 m3 522.70 37,300 Crude oil 104 Tons 418.16 71,100 Gasoline 104 Tons 430.70 67,500 Diesel 104 Tons 426.52 72,600 Fuel oil 104 Tons 418.16 75,500 LPG 104 Tons 501.79 61,600 Refinery gas 104 Tons 460.55 48,200 Natural gas 108 m3 3,893.10 54,300 Other petroleum products 104 Tons 418.16 75,500 Other coking products 104 Tons 284.35 95,700 Other E (standard coal) 104 Tons 430.70 0 Data source: All data are from the files mentioned above, and have been crosschecked against the original sources cited, as follows: Net calorific values: China Energy Statistical Yearbook, 2008 p. 284;

CO2 emission factors and oxidation rates: IPCC default values; see 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2 (energy);

Description of the calculation process The key methodological steps according to the „Tool to calculate the emission factor for an electricity system‟ are: 1. Identify the relevant electric power system 2. Select an operating margin (OM) method 3. Calculate the operating margin emission factor according to the selected method 4. Identify the cohort of power units to be included in the build margin (BM) 5. Calculate the build margin emission factor 6. Calculate the combined margin (CM) emission factor

Step 1. Identify the relevant electric power system

The Chinese DNA has defined and published a delineation of the project electricity system and connected electricity systems. Therefore, in accordance with the above mentioned tool, this delineation is applied to the project activity. The Xinma hydropower station project electricity system is defined as the Central China power grid. Similarly, and following the delineation of the Chinese DNA, the connected electricity system consists of the North, East, South and Northwest Grids, as the Central China power Grid exports electricity to the North, East and South China power Grid and imports electricity from the Northwest China Power Grid. The project is connected to the Sichuan Province Power Grid through local transformer station. The Sichuan Province Power Grid is part of the Central China Power grid, which includes the Sichuan, Henan, Hubei, Hunan, and Jiangxi and Chongqing city power grids.

Step 2. Select an operating margin (OM) method PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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The „Tool to calculate the emission factor for an electricity system‟ offers several options for the calculation of the OM emission factor. Of these, dispatch analysis, cannot be used, because dispatch data, let alone detailed dispatch data, are not available to the public or to the project participants. For the same reason, the simple adjusted OM methodology cannot be used. The average OM does not take into account the non-dispatchable nature of low-cost/must-run resources and as low-cost/must- run resources constitute less than 50% of total grid generation (see table B.8), we have selected the Simple OM method as the most appropriate method.

Table B.8 Electricity generation of the Central China Grid, 2003-2007 Year Generation (GWh) Thermal Hydro Others Total % Low cost/must run 2003 240,839 126,448 n.a. 367,287 34.43% 2004 270,846 169,094 n.a. 439,940 38.44% 2005 303,976 187,734 n.a. 491,710 38.17% 2006 334,027 225,073 n.a. 559,100 40.26% 2007 408,400 224,300 200 632,800 35.48% Source: China Electric Power Yearbook (editions 2004 - 2008).

Data vintage selection

In accordance with the „Tool to calculate the emission factor for an electricity system‟, the OM is calculated according to the „ex ante option‟: A three-year generation-weighted average, based on the most recent data available at the time of submission of the CDM-PDD to the DOE for validation, without the requirement to monitor and recalculate the emissions factor during the crediting period.

Step 3. Calculate the operating margin emission factor according to the selected method

According to the Simple OM method, the OM emission factor is calculated as the generation- weighted average tCO2 emissions per unit of net electricity generation (tCO2/MWh) of all generating power plants serving the system, excluding the low-cost/must-run power plants/units. We calculate the OM emission factor according to option C (based on data on the total net electricity generation of all power plants serving the system and the fuel types and total fuel consumption of the project electricity system) of the Simple OM method, as data required for option A (based on data on fuel consumption and net electricity generation of each power plant / unit) and B (based on data on net electricity generation, the average efficiency of each power unit and the fuel type(s) used in each power unit) such as electricity generation, fuel consumption data, etc for specific power plants/units serving the grid is not available to the public or to the project participants. Where option C is used, the simple OM emission factor is calculated based on the net electricity supplied to the grid by all power plants serving the system, not including low-cost/must-run power plants/units, and based on the fuel type(s) and total fuel consumption of the project electricity system, as follows:

FCi, j NCVi,y EFCO2,i,y i EFgrid,OMsimple,y (B.3) EGy

Where:

EFgrid,OMsimple,y is the simple operating margin CO2 emission factor in year y (tCO2/MWh); FCi,y is the amount of fossil fuel type i consumed in the project electricity system in year y (in a mass or volume unit); PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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NCVi,y is the Net Calorific Value (energy content) of fossil fuel type i in year y (GJ/mass or volume unit);

EFCO2,i,y is the CO2 emission factor of fossil fuel type i in year y (tCO2/GJ); EGy is the net electricity generated and delivered to the grid by all power sources serving the system, not including low-cost / must-run power plants / units, in year y (MWh); i are all fossil fuel types combusted in power sources in the project electricity system in year y, and; y is the three most recent years for which data is available.

Choice of aggregated data sources

The published OM emission factor calculates the emission factor directly from published aggregated data on fuel consumption, net calorific values, power supply to the grid and IPCC default values for the CO2 emission factor.

Calculation of the OM emission factor as a three-year full generation weighted average

On the basis of these data, the Operating Margin emission factors for 2005, 2006 and 2007 are calculated. The three-year average is calculated as a full-generation-weighted average of the emission factors. For details we refer to the publications cited above and the detailed explanations and demonstration of the calculation of the OM emission factor provided in Annex 3. We calculate the Operation Margin Emission Factor as 1.1255tCO2e/MWh.

The calculation of the OM emission factor is done once (ex ante) and will not be updated during the first crediting period. This has the added advantage of simplifying monitoring and verification of emission reductions.

Step 4. Identify the cohort of power units to be included in the build margin (BM)

According to the „Tool to calculate the emission factor for an electricity system‟, the sample group of power units m used to calculate the build margin consists of either: (a) The set of five power units that have been built most recently, or (b) The set of power capacity additions in the electricity system that comprise 20% of the system generation (in MWh) and that have been built most recently

A direct application of this approach is difficult in China. The Executive Board (EB) has provided guidance on this matter with respect to the application of the AMS-1.D and AM0005 methodologies for projects in China on 7 October 2005 in response to a request for clarification by DNV on this matter. The EB accepted the use of capacity additions to identify the share of thermal power plants in additions to the grid instead of using power generation. The relevance of this EB guidance extends to the „Tool to calculate the emission factor for an electricity system‟. The calculation in step 5 and the calculation of the published BM Emission factor by the Chinese authorities are based on this guidance. The approach is explained below in step 5 and is the one that has been followed in numerous PDDs using the similar ACM0002 methodology since the EB decision.

Data vintage selection

In accordance with the „Tool to calculate the emission factor for an electricity system‟, the BM is calculated according to option one: For the first crediting period, the build margin emission factor is calculated ex-ante based on the most recent information available. For the second crediting period, the build margin emission factor will be updated based on most recent data available at the time of PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

CDM – Executive Board page 21 submission of the request for registration. For the third crediting period, the build margin emission factor calculated for the second crediting period will be used.

Step 5. Calculate the build margin emission factor

The Build Margin Emission Factor is, according to the „Tool to calculate the emission factor for an electricity system‟, calculated as the generation-weighted average emission factor (measured in tCO2/MWh) of all power units m during the most recent year y for which data is available:

EGm,y EFEL,m,y m EFgrid,BM,y (B.4) EGm,y m

Where:

EFgrid,BM,y is the build margin CO2 emission factor in year y (tCO2/MWh); EGm,y is the net quantity of electricity generated and delivered to the grid by power unit m in year y (MWh);

EFEL,m,y is the CO2 emission factor of power unit m in year y (tCO2/MWh); m are the power units included in the build margin, and; y is the most recent historical year for which power generation data is available.

The sample m, according to the methodology, should be over the latest 5 power plants added to the grid, or over the last added power plants accounting for at least 20% of power generation. We apply an indirect approach based on the EB decision as mentioned in step 4.

First we calculate the newly–added installed capacity and the share of each power generation technology in the total capacity. Second, we calculate the weights of each power generation technology in the newly-added installed capacity.7 Third, emission factors for each fuel group are calculated on the basis of an advanced efficiency level for each power generation technology and a weighted average carbon emission factor on the basis of IPCC default carbon emission factors of individual fuels.

Since the exact data are aggregated, the calculation will apply the following method: We calculate the share of the CO2 emissions of solid fuel, liquid fuel and gas fuel in total emissions respectively by using the latest energy balance data available; the calculated shares are the weights.

Using the emission factor for advanced efficient technology we calculate the emission factor for thermal power; the BM emission factor of the power grid will be calculated by multiplying the emission factor of the thermal power with the share of the thermal power in the most recently added 20% of total installed capacity.

Detailed steps and formulas are as below:

7 Newly added capacity is determined as follows. First, the latest year (2007) for which data on total installed capacity is available is identified. Then, the last year is identified in which the total installed capacity was below 80% of the total installed capacity in 2007. This defines “newly added capacity”. Note that this approach does not follow the EB decision in response to the DNV request as mentioned in the main text to the letter, but the approach taken is the one that has been followed in numerous PDDs since the EB decision. PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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First, we calculate the share of CO2 emissions of the solid, liquid and gaseous fuels in total emissions respectively.

F NCV EF i,j,y i,j CO2 ,i,j,y i COAL,j (B.5) Coal,y F NCV EF i,j,y i,j CO2 ,i,j,y i,j F NCV EF i,j,y i,j CO2 ,i,j,y i OIL,j (B.6) Oil,y F NCV EF i,j,y i,j CO2 ,i,j,y i,j F NCV EF i,j,y i,j CO2 ,i,j,y i GAS,j (B.7) Gas,y F NCV EF i,j,y i,j CO2 ,i,j,y i,j where:

Fi,j,y the amount of the fuel i consumed in y year of j province (measured in tce); NCVi,y is the the net claronic value of fuel i in y year (solid and liquid fuel measured in GJ/T, Gas fuel measured in GJ/m3)

EFCO2,i,j,y is the emission factor of fuel i (measured in tCO2e) COAL,OIL and GAS subscripts standing for the solid fuel, liquid fuel and gas fuel

Second, we calculate the emission factor of the thermal power:

EFThermal Coal EFCoal,Adv Oil EFOil,Adv Gas EFGas,Adv (B.8)

Where: EFCoal,Adv, EFOil,Adv and EFGas,Adv represent the emission factors of advanced coal-fired, oil-fired and gas-fired power generation technology, see detailed parameter and calculation in Annex 3.

Third, we calculate BM of the power grid:

CAPThermal EFgrid,BM,y EFThermal (B.9) CAPTotal

Where:

EFgrid,BM,y is the build margin CO2 emission factor in year y (tCO2/MWh); CAPTotal represents the total newly-added capacity CAPThermal represents newly-added thermal power capacity. EFThermal is the emission factor of the thermal power

The λs are calculated on the basis of the weight of CO2 emissions of each type of fuel in the total CO2 emissions from thermal power. Subsequent calculation of the Build Margin emission factor yields a baseline emission factor of 0.5802 tCO2e/MWh.

For details we refer to Annex 3.

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The calculation of the BM emission factor for the first crediting period is done once (ex ante) and will not be updated during the first crediting period. This has the advantage of simplifying monitoring and verification of emission reductions.

Step 6. Calculate the combined margin (CM) emission factor

The Baseline Emission Factor is calculated as a Combined Margin, using a weighted average of the Operating Margin and Build Margin.

EFgrid,CM,y EFgrid,OM,y Wom EFgrid,BM,y WBM (B.10)

Where:

EFgrid,OM,y is the operating margin CO2 emission factor in year y (tCO2/MWh); EFgrid,BM,y is the build margin CO2 emission factor in year y (tCO2/MWh); Wom is the weighting of operating margin emissions factor (%) WBM is the Weighting of build margin emissions factor (%)

The “Tool to calculate the emission factor for an electricity system” provides the following default weights: Operating Margin, WOM = 0.5; Build Margin, WBM = 0.5

Applying the default weights and the calculated emission factors, we calculate a combined margin Baseline Emission Factor of 0.8528tCO2e/MWh.

Calculation of Baseline Emissions

Baseline Emissions are calculated by multiplying the Baseline Emission factor by the net quantity of electricity supplied to the grid electricity system by the project according to formula B.2 repeated below for convenience:

BEy = EGfacility,y ·EFgrid,CM,y

The estimated baseline emissions (see Section B.6.3) are based on expected net power supply to the gird and an ex ante calculation of the emission factor in the first crediting period, and will hence be revised during the implementation of the project activity on the basis of actual net power supply to the grid.

Step7. Calculation of Project Emissions (PEy)

Project emissions are calculated by using the following equation:

PEy PEFF,y PEGP,y PEHP,y (B.11)

Where:

PEy is project emissions in year y (tCO2e/yr) PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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PEFF,y is project emissions from fossil fuel consumption in year y (tCO2/yr) PEGP,y is project emissions from the operation of geothermal power plants due to the release of non-condensable gases in year y (tCO2e/yr) PEHP,y is project emissions from water reservoirs of hydro power plants in year y (tCO2e/yr)

The proposed project is a hydropower station without fossil fuel consumption on-site so that PEFF,y = 0, PEGP,y = 0.

In accordance with the methodology, project emissions from the reservoir have to be taken into account in case the power density of the project is between 4 and 10 W/m2. The power density can be calculcated as follows:

Cap Cap PD PJ BL (B.12) APJ ABL

Where: PD is the power density of the project activity, in W/m2;

CapPJ is the installed capacity of the hydro power plant after the implementation of the project activity (W);

CapBL is the installed capacity of the hydro power plant before the implementation of the project activity (W);

APJ is the area of the reservoir measured in the surface of the water, after the implementation of the project activity, when the reservoir is full (M2), and;

ABL is the area of the reservoir measured in the surface of the water, before the implementation of the project activity, when the reservoir is full (M2). For new reservoirs, this value is zero.

As the proposed project activity does not involve the retrofitting or modification of an existing hydropower plant and the project involves the creation of a new reservoir, we can simplify the calculation by assuming CapBL and ABL as zero and calculate the power density as follows:

Surface area of the reservoir at full capacity: 374,000 m2 Total installed capacity after implementation: 120,000,000 W Power Density (Installed capacity / Surface area) 120,000,000 / 374,000= 320 W/m2

Consequently, and according to the methodology, the power density is greater than 10W/m2 therefore PEHP,y = 0.

Project emissions equal to zero.

Step8. Calculation of Leakage (LEy)

In accordance with the methodology ACM0002 (version 10), leakage arise from the fuel disposal, land flooding and others for the construction of the hydropower station will be ignored. Also, the project participates don‟t advocate emission reductions that reduced under the baseline.

Step9. Calculation of the Project Emission Reductions

Emission reductions are calculated in accordance with methodology ACM0002 (version 10) as follows: PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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ERy BEy PEy LEy (B.13)

Where:

ERy are emission reductions in year y (tCO2/yr); BEy are baseline emissions in year y (tCO2/yr); PEy are project emissions in year y (tCO2/yr), and; LEy are leakage emissions in year y (tCO2/yr).

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

Data / Parameter: EFgrid,CM,y

Data unit: tCO2e/MWh Description: Combined Margin Grid Emission Factor Source of data: Calculated ex-ante based on the OM emission factor and BM emissions factor.

Value applied: 0. 8528 tCO2e/MWh Justification of the choice of Calculated from the Published emission factors data or description of measurement methods and procedures actually applied: Any comment: -

Data / Parameter: EFgrid,BM,y Data unit: tCO2e/MWh Description: Build Margin Grid Emission Factor Source of data: Calculated ex-ante (see Annex 3)

Value applied: 0.5802 tCO2e/MWh Justification of the choice of Emission factor published by the Chinese National Designated data or description of Authority. measurement methods and procedures actually applied: Any comment: -

Data / Parameter: EFgrid,OM,y

Data unit: tCO2e/MWh Description: Operating Margin Grid Emission Factor Source of data: Calculated ex-ante (see Annex 3)

Value applied: 1.1255 tCO2e/MWh Justification of the choice of Emission factor published by the Chinese National Designated data or description of Authority. measurement methods and procedures actually applied: Any comment: -

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Data / Parameter: CapBL Data unit: W Description: Installed capacity of the hydropower plant before the implementation of the project activity. For new hydropower plants the value is zero. Source of data: N.A. Value applied: Zero Justification of the choice of The proposed CDM project activity involves a new hydropower data or description of station and hence CapBL is zero. measurement methods and procedures actually applied: Any comment: -

Data / Parameter: CapPJ Data unit: W Description: Installed capacity of the hydropower plant after the implementation of the project activity. Source of data: Feasibility study report Value applied: 120,000,000W Justification of the choice of This is the best data available. data or description of measurement methods and procedures actually applied: Any comment: -

Data / Parameter: ABL Data unit: m2 Description: Are of the reservoir measured in the surface of the water, before the implementation of the project activity, when the reservoir is full (M²). Source of data: N.A. Value applied: Zero Justification of the choice of Not applicable: Abl is determined ex-ante: the size of the reservoir data or description of before implementation of the project cannot be monitored after measurement methods and implementation of the project activity. procedures actually applied: Any comment: -

Data / Parameter: APJ Data unit: m2 Description: Area of the reservoir measured in the surface of the water, after the implementation of the project activity, when the reservoir is full Source of data used: Feasibility study report Value applied: 374,000 m2 Justification of the choice of This is the best data available data or description of measurement methods and procedures actually applied: Any comment: -

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Data / Parameter: EGfacility,y Data unit: MWh/yr Description: Net electricity generation supplied to the grid by the project in year y

Source of data used: Preliminary Design Report #2 Value applied: 544,000 MWh Justification of the choice of This is the best data available data or description of measurement methods and procedures actually applied: Any comment: -

Parameters used for the calculation of the Operating Margin (OM) and Build Margin (BM) Emission Factors in accordance with the “Tool to calculate the emission factor for an electricity system”:

Data / Parameter: EGy Data unit: MWh (per annum) Description: Net electricity generated and delivered to the grid by power plant / unit in year y Source of data used: See the downloadable files mentioned above for the full data set. Original data are from China Electric Power Yearbook (Editions 2006, 2007 and 2008) Value applied: For detailed values; see Annex 3 Justification of the choice of These data are the best data available, and have been published by data or description of the Chinese authorities. measurement methods and procedures actually applied: Any comment: For the calculation of the OM emission factor, total electricity supply per power generating category has been used instead of electricity supply per power plant/unit. For the calculation of the BM emission factor, the latest 20% capacity addition to the grid has been employed. For values and a detailed description of the calculation method see Annex 3 and Section B.6.1 respectively.

Data / Parameter: Internal power consumption of power plants Data unit: Percentage Description: Internal consumption of power by source Source of data used: See the downloadable files mentioned above for the full data set. Original data are from China Electric Power Yearbook (Editions 2006, 2007 and 2008) Value applied: For detailed values; see Annex 3 Justification of the choice of These data are the best data available, and have been published by data or description of the Chinese authorities. measurement methods and procedures actually applied: Any comment: -

Data / Parameter: FCi,m,y, FCi,y, FCi,j,y, FCi,k,y, FCi,n,y, and FCi.n.h PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Data unit: Mass or volume unit Description: Amount of fossil fuel type i consumed by power plants / units m,j,k, or n in year y or hour h Source of data used: See the downloadable files mentioned above for the full data set. Original data are from China Energy Statistical Yearbook2006, 2007 and 2008 editions Value applied: For detailed values; see Annex 3 Justification of the choice of These data are the best data available, and have been published by data or description of the Chinese authorities. measurement methods and procedures actually applied: Any comment: For the calculation of the OM emission factor, total fuel consumption per power generating category has been used instead of fuel consumption per power plant/unit. For the calculation of the BM emission factor, the latest 20% capacity addition to the grid has been employed. For values and a detailed description of the calculation method see Annex 3 and Section B.6.1 respectively.

Data / Parameter: Efficiency of advanced thermal power plant additions Data unit: % Description: Source of data used: See the downloadable files mentioned above for the full data set. Data are based on the best technologies available in China. Value applied: Coal: 38.10%; Oil: 49.99%; Gas: 49.99% Justification of the choice of These data are the best data available, and have been published by the data or description of Chinese authorities. measurement methods and procedures actually applied: Any comment:

Data / Parameter: Capacity by power generation source Data unit: MW Description: For the different power generation sources, installed capacity in 2005, 2006 and 2007 in the Central China Grid. Calculated by summing provincial data. Source of data used: China Electric Power Yearbook (Editions 2006, 2007 and 2008) Value applied: For detailed values; see Annex 3 Justification of the choice of These data are the best data available, and have been published by the data or description of Chinese authorities. measurement methods and procedures actually applied: Any comment:

Data / Parameter: Oxidation Factor Data unit: Percentage Description: Oxidation factors for 16 different fuels Source of data used: Data used are IPCC default values. See 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2, Energy Value applied: For detailed values; see Annex 3 PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Justification of the choice of These data are the most recent data available, and have been used by the data or description of Chinese authorities to calculate the emission factors. measurement methods and procedures actually applied: Any comment: 2006 IPCC emission factors are based on 100% oxidation default values and the “Tool to calculate the emission factor for an electricity system” does not require the use of oxidation values. We have listed them as a parameter as the Chinese DNA uses them (100%) and we want to be comprehensive. Utilizing 100% oxidation default values does not influence the calculation of the combined margin grid emission factor.

Data / Parameter: EFco2,i,y and EFco2,m,i,y Data unit: tCO2/GJ Description: tCO2 emission factor of fossil fuel type i in year y Source of data used: Data used are IPCC default values. See 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2, Energy Value applied: For detailed values; see Annex 3 Justification of the choice of These data are the most recent data available, and have been used by the data or description of Chinese authorities to calculate the emission factors. measurement methods and procedures actually applied: Any comment:

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 used: See the downloadable files mentioned above for the full data set. Original data are from China Energy Statistical Yearbook, (2008) p. 284. Value applied: For detailed values; see Annex 3 Justification of the choice of These data are the best data available, and have been published by the data or description of Chinese authorities. measurement methods and procedures actually applied: Any comment:

Data / Parameter: Electricity imports from connected grids Data unit: MWh (per annum) Description: Electricity imports of power from other grids Source of data used: Original data are from China Electric Power Yearbook (Editions 2006, 2007 and 2008) and the China Clean Development Mechanism website online at: http://qhs.ndrc.gov.cn/qjfzjz/W020090703644238739485.xls Value applied: For detailed values; see Annex 3 Justification of the choice of These data are the best data available, and have been published by the data or description of Chinese authorities. measurement methods and procedures actually applied: Any comment:

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B.6.3. Ex-ante calculation of emission reductions:

Baseline emissions The annual net power supply to the Central China Grid during the first crediting period is estimated to be 544,000 MWh.

Applying formula B.2 presented in Section B.6.1, we obtain the values for the baseline emissions during the first crediting period provided in Table B.9:

Table B.9 The estimation of baseline emissions during the 1st crediting period Year Annual net power supply Baseline emission Baseline emissions to the grid (EGy) (MWh) factor (tCO2e) (tCO2/MWh) 01/06/2011- 31/05/2012 544,000 0.8528 463,923 01/06/2012- 31/05/2013 544,000 0.8528 463,923 01/06/2013- 31/05/2014 544,000 0.8528 463,923 01/06/2014- 31/05/2015 544,000 0.8528 463,923 01/06/2015- 31/05/2016 544,000 0.8528 463,923 01/06/2016- 31/05/2017 544,000 0.8528 463,923 01/06/2017- 31/05/2018 544,000 0.8528 463,923 Total 3,247,461 Average 544,000 0.8528 463,923

In a given year, the emission reductions realized by the project activity (ER y) is equal to baseline GHG emissions (BEy) minus project direct emissions and leakages during the same year:

ERy = BEy - PEy - Ly

Leakage and Project emissions

The project activity involves the construction of a new hydropower station with a power density greater than 10 W/m2 and therefore emissions from the reservoir have been assumed zero (see Section B.6.1). In accordance with the ACM0002 methodology, leakage is equal to zero.

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

Table B.10 provides the annual emission reductions in tabular form.

Table B.10 Ex ante estimate of emission reductions due to the project Project Baseline Emission Leakage Year Emissions emissions Reductions (tCO2) (tCO2) (tCO2) (tCO2) 01/06/2011- 31/05/2012 0 463,923 0 463,923 01/06/2012- 31/05/2013 0 463,923 0 463,923 01/06/2013- 31/05/2014 0 463,923 0 463,923 01/06/2014- 31/05/2015 0 463,923 0 463,923 01/06/2015- 31/05/2016 0 463,923 0 463,923 01/06/2016- 31/05/2017 0 463,923 0 463,923 01/06/2017- 31/05/2018 0 463,923 0 463,923 PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Total (tonnes of CO2 e) 0 3,247,461 0 3,247,461

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

Data / Parameter: EGfacility,y Data unit: MWh/yr Description: Quantity of net electricity generation supplied by the project plant/unit to the grid in year y Source of data: Project activity site Measurement Electricity meters procedures (if any): Monitoring Continuous measurement and at least monthly recording frequency: QA/QC procedures: Cross check measurement results with records for sold electricity

Any comment: -

Data / Parameter: CapPJ Data unit: W Description: Installed capacity of the hydro power plant after the implementation of the project activity Source of data: Project site Measurement Determine the installed capacity based on recognized standards procedures (if any): Monitoring Yearly frequency: QA/QC procedures: - Any comment: -

Data / Parameter: TEGy Data unit: MWh/yr Description: Total electricity produced by the project activity, including the electricity supplied to the grid and the electricity supplied to internal loads, in year y Source of data: Project activity site Measurement Electricity meters procedures (if any): Monitoring Continuous measurement and at least monthly recording frequency: QA/QC procedures: - Any comment: Applicable to hydro power project activities with a power density of the project activity (PD) greater than 4 W/m2 and less than or equal to 10 W/m2

Data / Parameter: APJ PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Data unit: m2 Description: Area of the reservoir measured in the surface of the water, after the implementation of the project activity, when the reservoir is full Source of data: Project site Measurement Measured from topographical surveys, maps, satellite pictures, etc procedures (if any): Monitoring Yearly frequency: QA/QC procedures: - Any comment: -

B.7.2. Description of the monitoring plan:

This monitoring plan outlines the principles which shall be followed in the monitoring of the parameters listed in section B.7.1. A monitoring manual with detailed procedures will be prepared on the basis of the principles outlined below. The monitoring manual may be updated to reflect the actual implementation of the project but will not deviate from the monitoring plan as presented in this section.

Monitoring of net electricity supplied by the project to the grid

The project is connected to the Sichuan Provincial Power Grid via the Yonglang 220kV transformer station. A grid connection diagram (Figure B.3 below) indicates the principles for positioning of metering instruments that will be used in the monitoring of emission reductions. A separate monitoring manual is prepared with detailed procedures and a detailed grid connection diagram which is updated on the basis of the actual implementation of the project‟s grid connection and which will serve as the basis for periodic verification. The project entity will ensure that the actual implementation of grid connection will not deviate from the procedures outlined in this section. PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Figure B.3 Indicative grid connection diagram

Internal power line Main power supply line Turbine / generator unit

Back-up power line

Project / Grid Boundary M2a M3a

M1a M1b M1c

The project entity will meter electric power according to the following principles:

. Power supplied to the grid: As indicated in Figure B.3 the project is connected by one or multiple main power supply lines (indicated in red) which will deliver power generated by the project to the grid. Net power supplied to the grid is metered as below:

o Project entity: The power supplied to the grid is metered by the project entity at meter after the power has been transformed to 110kV. The power supply of the project to the grid will be metered with standard electricity meters in accordance with national regulations. The metering instruments may record either a net figure of power delivered to the grid or two readings, i.e. power delivered to the grid and power received from the grid.

o Calibration: Calibrations are carried out by the grid company or by a certified company appointed by the grid company.

. Power received through back-up power lines: As indicated in Figure B.3 the project is connected by one or multiple back-up emergency power lines (indicated in brown) which will deliver power from the grid to the project in case of emergencies or when the turbines of the proposed project activity are not in operation. Net power received from the grid is metered as below:

o Project entity: The power supplied to the project through the back-up emergency power lines will be metered by the project entity with standard metering instruments in accordance with national regulations. PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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o Calibration: Calibrations are carried out by the grid company or by a certified company appointed by the grid company.

. Total electricity produced by the project activity: Electricity generation will be measured with Meter M1a,b,c by the project entity with standard metering instruments in accordance with national regulations and will be used the check the plausibility of electricity supply. Periodic calibration are carried out by the grid company or by a certified company appointed by the grid company.

. Installed capacity of the hydropower plant: In addition to the above, the installed capacity of the hydropower plant will be monitored yearly. The project entity will annually prepare photographic evidence of the installed equipment on the basis of the nameplates, which will be in accordance with domestic and international standards, or statements/documents by the manufacturer of the technollogy or the project entity.

. Monitoring of reservoir surface area: The project entity will monitor the surface area of the reservoir by collecting photographic evidence of the surface level when the project becomes operational. This photographic evidence will be compared with the design reservoir dimensions to confirm whether or not the actual surface area substantially deviates from the design surface area.

. Reporting, archiving and preparation for periodic verification The project entity will in principle report the monitoring data annually but may deviate to report at intervals corresponding to agreed verification periods and will ensure that these intervals are in accordance with CDM requirements. The project entity will ensure that all required documentation is made available to the verifier. Data record will be archived for a period of 2 years after the crediting period to which the records pertain.

The project entity will collect internal records, sales receipts for power supplied to the grid and billing receipts for power received from the grid as evidence. The net supply (i.e. gross supply minus supply by the grid to the project) will be used in the calculations of emission reductions. In case of discrepancies between the readings of the grid company and the project entity, the readings of the grid company will prevail. All records of power delivered to the grid, sales receipts and the results of calibration will be collated in a central place by the project entity.

An overview of detailed information on minimum accuracy requirements of the metering instruments, measuring intervals, recording form, calibration and available documentation is provided in Table B.11.

Determination of net power supply:

Net electricity supplied to the grid by the project (EGfacility,y in section B.7.1.) is calculated on a monthly basis as:

EGfacility,y = ESy- EDy

With:

ESy, electricity supplied by the project through the main power line(s) (in MWh) metered by the project entity (evidenced by monthly sales receipts). PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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EDy, electricity delivered to the project through back-up power line(s) metered by the project entity (evidenced by monthly billing receipts). PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

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Table B.11 Details of metering instruments Meter Operated Electronic Manual Recording Periodic Accuracy Documentation by measurement logging Calibrations

M1x Project Continuous Daily Calibrated 8 Grid entity (optional) periodically in Company or Print out of electronic record accordance with the a certified “Technical Monthly company M2 Project Continuous Daily administrative code of x appointed Print out of electronic record entity (optional) electric energy by the grid M3 Project Continuous Daily metering (DL/T448- x company Print out of electronic record entity (optional) 2000)”.

8 The project entity intends to log the readings of meters M1x and M2x manually in daily logs, but these logs will not form a formal requirement during verification. The ACM0002 methodology only requires continuous electronic measurement and these manual log records will only be maintained for back-up purposes. The project entity may deviate from this procedure during actual operation of the project.

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PROCEDURES IN CASE OF DAMAGED METERING EQUIPMENT / EMERGENCIES

Damages to metering equipment:

In case metering equipment is damaged and no reliable readings can be recorded, the project entity will estimate net supply by the proposed project activity according to the following procedure:

In case metering equipment operated by project entity is damaged: The sales receipts will be used as record of net power supplied to the grid for the days for which no record could be recorded.

The project entity will furthermore document all efforts taken to restore normal monitoring procedures.

Emergencies:

In case of emergencies, the project entity will not claim emission reductions due to the project activity for the duration of the emergency. The project entity will follow the following procedure for declaring the emergency period to be over: 1. The project entity will ensure that all requirements for monitoring of emission reductions have been re- established. 2. The monitoring officer and the head of operations of the hydropower station will both sign a statement declaring the emergency situation to have ended and normal operations to have resumed.

OPERATIONAL AND MANAGEMENT STRUCTURE FOR MONITORING

The monitoring of the emission reductions will be carried out according to the scheme shown in Figure B.4. The manager of the company will hold the overall responsibility for the monitoring process, but as indicated below parts of the process are delegated. The first step is the measurement of the electrical energy supplied to the grid and reporting of daily operations, which will be carried out by the operational staff on duty. The project owner will appoint a monitoring officer who will be responsible for verification of the measurement, collection of sales receipts, collection of billing receipts of the power supplied by the grid to the hydropower plant and the calculation of the emissions reductions. The monitoring officer will prepare operational reports of the project activity, recording the daily operation of the hydropower station including operating periods, power generation, power delivered to the grid, equipment defects, etc. The selection procedure, tasks and responsibilities of the monitoring officer are described in detail in Annex 4. Finally, the monitoring reports will be reviewed by the manager of the company.

Figure B.4. Management structure in order to monitor emission reductions

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Manager of the Company Review /internal audit

Monitoring officer: Verification of measurement & calculation of emission reductions Support from the CDM consultants

Operational staff on duty: Measurement of electrical power

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 completion of the baseline study and monitoring methodology: 11/08/2009

Name of entity responsible: Caspervandertak Consulting Tel: +86-10-84505756 Fax: +86-10-84505758

Gansu Tonghe Investment Project Consulting Tel: +86-931-4663436 Fax: +86-931-8440721

Gansu Tonghe Investment Project Consulting and Caspervandertak Consulting are not project participants.

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SECTION C. Duration of the project activity / crediting period

C.1. Duration of the project activity:

C.1.1. Starting date of the project activity:

16/01/2007 (Signed the construction contract)

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

30 years

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

C.2.1. Renewable crediting period:

A renewable crediting period is chosen 7*3

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

01/06/2011

C.2.1.2. Length of the first crediting period:

7 years C.2.2. Fixed crediting period:

C.2.2.1. Starting date:

Not applicable

C.2.2.2. Length:

Not applicable

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SECTION D. Environmental impacts

D.1. Documentation on the analysis of the environmental impacts, including transboundary impacts:

An Environmental Impact Assessment (EIA) was designed by the Chengdu Technology University Environmental Technology Research Institute and was approved by Environment Protection Bureau of Sichuan Province on 07 Sep. of 2006, Chuan Huan Jian Han 2006 No.572. A summary of the main findings of the EIA is provided below. The potential environmental impacts and mitigation measures during the construction and operation periods are as follows:

During Construction Phase

1) Water

During the construction phase, the waste water includes producing waste water, sewage and oily waste water. The production wastewater treatment facilities will be established for treating and recycling this waste water. The oily waste water will be collected and treated with an oil separator and sedimentation tank before being discharged. Wastewater and sewage produced by construction workers will be taken care of by temporarily setting up standard toilets on-site and will be treated with before being discharged.

2) Air

Main source of air pollution are emission of the fuel burning of the machinery, waste gas of explosions and dust. Measures will be taken to mitigate this pollutant, such as the machinery and vehicles should follow the national emission standard, performing timely maintenance of fuel-fired equipment, spraying water during different working process, cover the surface of the explosions.

3) Noise

Noise pollution mainly results from explosions, construction machineries, vehicles, and machinery maintenance. As a result of the construction sites is far away from residential areas and at the same time projects the wild animals have adapted to human activities in this area, therefore, the impact of the noise mainly on personnel. There will be some labour protection measures to minimize the impact of noise on the personnel.

4) Solid waste

The main solid waste produced by this project includes the waste residue of construction and the domestic refuses. 10 solid waste deposits will be built to treat the waste residue. Also a special domestic waste disposal plant will be built and the domestic refuses will be collected together and transported to the landfills of Dechang County

5) Ecology

During the construction period, there are some impacts on vegetation, animals and soil erosion. The education of forest fire prevention and animal protection will be implemented, and also take strong measures to prevent soil erosion in 6 areas, such as permanent land use area.

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During Operation Phase

1) Water

Take some measures to ensure that there will be no great impact on hydrological situation. Clean up the reservoir to reduce the impacts on water quality. Take a reasonable way to ensure that the silt have no impact on the railway bridge.

2) Solid Waste

The main solid waste is the domestic refuses generated by the superintendents. A special domestic waste disposal plant will be built and the domestic refuses will be collected together and transported to the landfills of Dechang County

4) Ecology

During the operation phase, rehabilitation of vegetation will be conducted. A minimum biological water flow of 9.8m3/s through the sluice will be ensured the ecological need of the lower reaches area.

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:

The environmental impacts of the project are not considered significant by the Chinese government and the project participants. The Environmental Impact Assessment Form (EIA) was accepted by the Environment Protection Bureau of Sichuan Province

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SECTION E. Stakeholders’ comments

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

The project entity carried out a separate stakeholder consultation to confirm the impacts of the project on the relevant stakeholders. The consultation consisted of the following elements:

Organization of a stakeholder consultation meeting near project site:

Date and time: 9:00 to 12:00 29th April, 2009 Place: Project construction onsite office of Xinma hydropower station, Dechang County, Sichuan Province

Agenda of the meeting:

- Opening of the meeting - Introduction of the project - Introduction of the Clean Development Mechanism - Explanation of the stakeholder consultation process - Round of comments by each participant - Further questions and answers - Distribution and collection of a questionnaire to attendees (See table E.2) - Closing of the meeting

To ensure wide participation of stakeholders, announcements of the stakeholder consultation meeting and website were made through the following channels:

1. A consultation meeting notification was published on Liangshan Daily on 9th Apr. 2009. 2. A notification with same content with the Liangshan Daily on the website of Dechang County Public Information: http://dc.lsz.gov.cn/news/show.php?id=1419 3. 2 posts about the consultation meeting were posted in each village in the project region one week before the meeting. 4. Faxes were sent out to the local government to invite the government representatives.

In addition to the above announcements, important stakeholders received personal invitations to attend the meeting. See for attendance of the meeting Table E.1. A report of the main comments and outcomes of the meeting is provided in section E.2.

Table E.1. List of stakeholders that attended the stakeholder consultation meeting No. Organization Name 1 Jinsha village Zhong Rongkang 2 Jinsha village Diao Yongxin 3 Jinsha village Diao Yanghua 4 Jinsha village Diao Zhiquan 5 Guanmen village Li Minggang 6 Jinchuan township government He Meifa 7 Dechang County Resettlement Bureau Wang Binghua

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8 Dechang County Environment Protection Bureau Ma Rong 9 Dechang Xinm Hydropower Development Co., Ltd. Yuan Nianyi 10 Xiaogao Township government Peng Fuxiang 11 Leyue Township government Xiao Qilin 12 Lianmen village Wang Yongguang 13 Lianfeng village Ma Fazong 14 1st group of Lianfeng village Cui Yingfeng 15 7th group of Lianmeng village Li Zhihua 16 2nd group of Lianmeng village LI Yuanxue 17 6th group of Shaba village Wang Zhonghua 18 1st group of Shaba village Xie Wenzhen 19 Shaba village Tian Yingcai 20 Lianmeng village Chen Denggui 21 Dechang Xinma hydropower development Co., Ltd Wu Shouzeng 22 Dechang Xinma hydropower development Co., Ltd. Zheng Quan 23 Dechang County Land Resource Bureau Yuan Delin 24 Dechang County Development and Reform Bureau Liao Guangrong 25 2nd group of Lianmeng village A Jiazi 26 R&J International Co., Ltd. Xiao Ruyun 27 Cvdt Consulting Alexia Pestre

E.2. Summary of the comments received:

Comments and opinions received at stakeholder consultation meeting:

Some important stakeholders and representatives of the villagers expressed his or her opinion on the proposed project. During the meeting many stakeholders asked general questions about the CDM procedures, these comments were omitted from the comments stated below.

An overview of the main comments/questions expressed during the meeting:

Name: Ma Rong Position / Affiliation: Dechang County Environment Protection Bureau Comments: 1. Hydropower is a kind of clean energy, and an environmental industrial, hope the project owner shall construct the project according to the EIA. 2. The project has got an EIA approval from the provincial EPB, the project construction was carried out in accordance with the relative laws and which was started construction after being approved. 3. The construction of the project was monitored by the prefecture and county level EPB, the construction was carried out according to the EIA. 4. Hope the project will finalize construction as soon as possible and to ensure the ecological flow. In general, it is a project that benefits both the economy development and residents‟ life.

Name: Liao Guangrong Position / Affiliation: Dechang County Development and Reform Bureau Comments: Support the project construction as well as CDM development as a government organization.

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Xinma hydropower station is the biggest hydropower station in Dechang County construction in accordance with relative regulations, there will be more than 50 million RMB of tax income for Dechang County. The proposed project will make use of clean energy, which will not affect ecological damage; in addition, the project EIA has being approved. Wish the project will start construction and put in to commission as soon as possible.

Name: Yuan Delin Position / Affiliation: Dechang County Land Resource Bureau Comments: All the approval process has being carried out in aspect of Land Resource Bureau for the proposed project. The development of hydropower will not impact the environment; the project owner should recover the slag yard after project construction.

Name: Alexia Position / Affiliation: CVDT Comments: Is there any land expropriation for the project, for the displaced and resettled villagers, did they got compensation in accordance with policies and regulations? Reply: The process of compensation will accord with the land administration law and approved from provincial to local level. Villagers who‟s land will be expropriated will be compensated according to the relative laws while the compensation for displaced has being transfer to the county land resource bureau.

Name: Wang Binghua Position / Affiliation: Dechang Resettlement Bureau Comments: The proposed project is the biggest constructing project in An‟ning river valley, both Environment, resettlement and land resource bureau have given a great support to the project. The displace process shall be carried out with the following order: the displacement investigation, resettlement outline, provincial resettlement office, audit of experts, displacement. For that there are only 47 displaced people (which is comparatively fewer), in addition, there will be other 822 villagers whose land will be expropriated.

Name: He Meifa Position / Affiliation: Dechang County Jinchuan Town Comments: 1. Thanks for the holding of such a meeting, the development of hydropower resource can benefit both the country and people, and will also cause little impact to the environment. 2. 6 families in Jinchuan town will be displaced; the compensation has already being distributed. 3. The construction of the project will impact the daily life for villagers living around in the construction period, however, this can be solved by building of temporary channel and water supply pipe.

Name: Xiao Qilin Position / Affiliation: Dechang County Leyue Town government Comments: 1. The construction of proposed project can benefit both the county and villagers, and can promote the economy development of the county. 2. The impact of hydropower station to the environment is not big and the construction of division tunnel reduced the land expropriation. 3. Support the construction of the project.

Name: Peng Fuxiang Position / Affiliation: Dechang County Xiaogao Township Government Comments:

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1. The proposed project is the most important construction project in the county, the land expropriation and resettlement works has carried out very carefully; and got a full support of the relative government organizations. 2. In aspect of resettlement, the project owner abides the relative national rules and policies strictly. 3. The construction of the project has impacted Jinchuan and Leyue township, the water supply has been impacted by the construction work, wish the project will solve it.

Name: Zhong Rongkang Position / Affiliation: Jinsha Township, Jinsha village Comments: Hydro power is a kind of environmental friendly resource, although there might be some impact of the water supply, there is no big problem, support the project as a villager.

Name: Diao Yongxin Position / Affiliation: Jinsha village Comments: The way of water division is to dig tunnel, it will use few land resource thus make it a good project. However, the villages are near to the construction site, the construction might impact water supply. Reply: For the water supply issue, the construction company will discuss with the stakeholders and government to find a solution.

Name: Diao Yanghua Position / Affiliation: Jinsha village Comments: 1. Jinsha village locates near #4 and #5 branch construction tunnel, the village will impact by the project, 8 families‟ land will be expropriated. 2. The water supply difficulties aroused from the tunnel construction, how to solve it. Generally, understand the project owner, support the construction of the project.

Name: Alexia Position / Affiliation: CVDT Comments: What is the main income for the villagers whose land will be expropriated? Reply: The farming income is the main income, most of the villagers whose part land will be expropriated, not all of the land.

Name: Diao Zhiquan Position / Affiliation: Jinsha village Comments: 1. Families whose land has been expropriated are comparatively satisfied for the compensation. 2. For the water supply issue, the project owner has solved some of them, trust the project owner shall give a answer for it.

Name: Li Minggang Position / Affiliation: Guanmen village Comments: 1. The main impacts for Guanmen village comes from 2 branch tunnels, power plant and the slag yard. Meanwhile, the construction impacts the farming irrigation. Hope the project owner shall recover the vegetation and find ways to minimize the impacts. 2. For the meadow the sandpit occupied, hope there will be compensation for every family.

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Name: Wang Yongguang Position / Affiliation: Lianmeng village Comments: Not sure if the area and field condition of the slag yard will be recovered, is there any feasible ways to find a solution? Reply: Designated personal shall be asked to solve it.

Name: Ma Fazong Position / Affiliation: Lianfeng village Comments: 1. The water level in the river valley will rise if the dam if the station reserves water, not sure if it will flood the fields, is there any solutions. 2. Is there any ways to minimize the construction dust? Generally, the construction of the project will bring more benefits, support the construction of the project.

Name: Cui Yingfeng Position / Affiliation: First group of Lianfeng village Comments: The same with Mr. Ma Fazong‟s opinion, support the construction of the project. Reply: For the dust issue, in fact all river valleys in Dechang County will impact by the southeast monsoon, which will enhance dust pollution, the project owner should watering the dust in order to minimize the impact to the villagers.

Name: Li Zhihua Position / Affiliation: Lianmeng Group of Xiaogao township Comments: Support the construction of the project, and hope there will be more project developed, thus promote the local economy.

Name: Wang Zhonghua Position / Affiliation: 6th Group of Leyue township Comments: Support the project construction.

Name: Li Yuanxue Position / Affiliation: 2nd Group of Lianmeng village Comments: The hydropower is a kind of clean energy, the development of hydropower will bring harmonious develop of people and the nature.

Name: Xie Wenzhen Position / Affiliation: 1st Group of Sahba village Comments: Support the project construction; hope the project owner will solve the water supply problem well.

Name: Tian Yingcai Position / Affiliation: Shaba village Comments: The construction of the project will promote local economy, support the project construction, hope the project owner will maintenance the road and bridge well.

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Name: Cheng Denggui Position / Affiliation: Lianmeng village Comments: The construction of project will promote local economy development. As a villager whose land has being expropriated, the construction of the project will bring goodness to the villagers; the project owner build bridges thus improved the local transportation. Suggest the project owner will strengthen maintenance of the bridge and road; hope villagers will get compensation according to the relative approvals and regulations.

Questionnaire survey

After the meeting, the project owner invited the participant villagers to fill out the questionnaires collecting comments in 7 aspects of the impacts on the land requisition, economy, society, environment, irrigation and whether they support the project. The outcome of questionnaire is count as bellow:

Table E.2. Main findings of the questionnaire Number N The impacts due to the construction and operation of Number of Percentage o the project on the following aspects of people People (%) consulted Are there any Yes 8 9.20% 87 Land relocated people? No 79 90.80% 1 expropriatio Are there lands Yes 67 72.04% n 93 expropriated? No 26 27.96% Positive impact 55 57.29% Employment No impact 41 96 42.71% opportunity Negative impact 0 0% Boost related Positive impact 80 83.33% industries No impact 16 96 16.67% Economic development 2 Increase income Negative impact 0 0% aspect Positive impact 78 80.41% Local financial 97 revenue No impact 19 19.59% Negative impact 0 0% Positive impact 80 83.33% Economic No impact 16 96 16.67% development Negative impact 0 0% Positive impact 72 74.23% Power supply No impact 25 97 25.77% Negative impact 0 0% Positive impact 61 64.21% Living Water fetching and No impact 34 95 35.79% irrigation aspect Negative impact 0 0% 3 Positive impact 67 70.53% transportation No impact 28 95 29.47% Negative impact 0 0% Positive impact 52 55.32% Income and living No impact 42 94 44.68% standard Negative impact 0 0%

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Dust 46 48.94% Waste water 2 2.13% Impacts due to the Noise 20 21.28% 94 project‟s construction Waste slag 29 30.85% Water & Soil 9 9.57% losses Domestic sewage 11 12.09% Impacts due to the Solid waste 35 91 38.46% Environmen project‟s operation t Ecological flow 45 49.45% 4 Positive impact 54 58.70% aspect Against floods No impact 38 92 41.30% Negative impact 0 0% Positive impact 54 58.06% Reducing trees No impact 39 93 41.94% cutting down Negative impact 0 0.00% Positive impact 47 50.54% General trend No impact 46 93 49.46% Negative impact 0 0% Whether support the project‟s support 100 100 100% 5 construction or not Don‟t support 0 0%

The results show that the large majority of the local population supports the Xinma Hydropower project for its contribution to the County‟s development.

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

Given the generally positive nature of the comments received, no further measures are considered necessary.

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Annex 1

CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY

The Project Entity:

Organization: Dechang Xinma Hydropower development Co., Ltd th Street/P.O.Box: 5 floor, Xinhe Hotel, th Building: 5 floor, Xinhe Hotel City: Dechang County State/Region: Sichuan Province Postfix/ZIP: 615500 Country: China Telephone: 0834-5204750 FAX: 0834-5204750 E-Mail: [email protected] URL: Represented by: Zhou Shaoming Title: Directors Salutation: Mr Last Name: Zhou Middle Name: First Name: Shaoming Department: - Mobile: 13398168686 Direct FAX: 028-85769597 Direct tel: 028-85769573 Personal E-Mail: [email protected]

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The Purchasing Party:

Organization: Vitol S.A. Street/P.O.Box: 28 Boulevard du Pont-d‟Arve Building: City: Geneva State/Region: Postfix/ZIP: CH1205 Country: Switzerland Telephone: +41 22 322 11 11 FAX: +41 22 800 23 74 E-Mail: [email protected] URL: www.vitol.com Represented by: David Fransen Title: Managing Director Salutation: Mr. Last Name: Fransen Middle Name: First Name: David Department: Mobile: Direct FAX: +41 22 800 23 74 Direct tel: +41 22 322 11 11 Personal E-Mail:

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Annex 2

INFORMATION REGARDING PUBLIC FUNDING

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Annex 3

BASELINE INFORMATION

Our baseline calculations follow the approach applied in the OM and BM emission factors baseline calculations published by the Office of National Coordination Committee on Climate Change of the People‟s Republic of China. Detailed information can be found on their website:

- Baseline emission factor: http://qhs.ndrc.gov.cn/qjfzjz/t20090703_289357.htm

- Calculation of OM: http://qhs.ndrc.gov.cn/qjfzjz/W020090703644238739485.xls

- Calculation of BM: http://qhs.ndrc.gov.cn/qjfzjz/W020090703644239079814.doc

Below we provide the main data used in the calculation of the baseline emission factor as well as the calculation process.

Table A1. Calculation of the Combined Margin Emission Factor Emission factor Value and Source Weight Weighted value A B C D = B * C

1 EFOM 1.1255 0.5 0.56276 Table A2

2 EFBM 0.5802 0.5 0.29008 Table A10c 3 CM 0.85285 D1 + D2

Table A2. Calculation of the Operating Margin Emission Factor Variable 2007 2006 2005 Total A B C D 377,233,680 334,027,226 286,203,305 997,464,211 Supply of thermal power to 1 D1 = A1 + B1 Central China grid (MWh) Table A3c, C7 Table A3b, C7 Table A3a, C7 + C1 3,005,400 3,028,950 0 6034350 Imports of power from other grids 2 Files cited D2 = A2 + B2 (MWh) Files cited above Files cited above above + C2 Total power supply for calculation 380,239,080 337,056,176 286,203,305 1,003,498,561 3 EFOM (MWh) A3 = A1 + A2 B3 = B1 + B2 C3 = C1 + C2 D3 = D1 + D2 CO2 emissions associated with 415,974,066 375,028,077 332,420,496 1,123,422,640 4 thermal power generation on D4 = A4 + B4 Table A4c, E Table A4b, E Table A4a, E Central China grid (tCO2) + C4 CO2 emissions associated with 3,039,328 3,003,157 0 6042485.897 5 power imports from other grids D5 = A5 + B5 Table A5 Table A5 (tCO2) + C5 6 Total CO2 emissions for 419,013,395 378,031,235 332,420,496 1,129,465,125

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calculation EFOM (tCO2) A6 = A4 + A5 B6 = B4 + B5 C6 = C4 + C5 D6 = D4 + D5 1.10197 1.12157 1.16148 1.12553 7 EFOM (tCO2/MWh) A6 / A3 B6 / B3 C6 / C3 D6 / D3

Table A3a. Calculation of thermal power supply to North West China Grid, 2005 Thermal Power Thermal power Grid generation Losses (%) supply (MWh) (MWh) C = A * (100 - B) / A B 100 1 Jiangxi 30,000,000 6.48 28,056,000 2 Henan 131,590,000 7.32 121,957,612 3 Hubei 47,700,000 2.51 46,502,730 4 Hunan 39,900,000 5.00 37,905,000 5 Chongqing 17,584,000 8.05 16,168,488 6 Sichuan 37,202,000 4.27 35,613,475 7 Central China 286,203,305

C7 = C1 + C2 + C3 +

C4 + C5 + C6

Source: Files mentioned above, original data are from China Electric Power Yearbook 2006, p. 559-560 and 568.

Table A3b. Calculation of thermal power supply to North West China Grid, 2006 Thermal Power Thermal power Grid generation Losses (%) supply (MWh) (MWh) C = A * (100 - B) / A B 100 1 Jiangxi 34,449,000 6.17 32,323,497 2 Henan 151,235,000 7.06 140,557,809 3 Hubei 54,841,000 2.75 53,332,873 4 Hunan 46,408,000 4.95 44,110,804 5 Chongqing 23,487,000 8.45 21,502,349 6 Sichuan 44,193,000 4.51 42,199,896 7 Central China 334,027,226

C7 = C1 + C2 + C3 +

C4 + C5 + C6

Source: Files mentioned above. Original data are from China Electric Power Yearbook 2007, p. 639. China Energy Statistics Book 2007.p42.

Table A3c. Calculation of thermal power supply to North West China Grid, 2007

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Thermal Power Thermal power Grid generation Losses (%) supply (MWh) (MWh) C = A * (100 - B) / A B 100 1 Jiangxi 42,100,000 7.72 38,849,880 2 Henan 177,300,000 7.55 163,913,850 3 Hubei 60,900,000 6.69 56,825,790 4 Hunan 54,200,000 7.18 50,308,440 5 Chongqing 28,800,000 9.2 26,150,400 6 Sichuan 45,100,000 8.68 41,185,320 7 Central China 377,233,680 C7 = C1 + C2 + C3 +

C4 + C5 + C6 Source: Files mentioned above. Original data are from China Electric Power Yearbook 2008, p. 733-734.

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Table A4a. Calculation of CO2 emissions from fuels for thermal power production, Northwest China Grid, 2005 Chongqin Central Oxidation Carbon Fuel Unit Jiangxi Henan Hubei Sichuan Hunan NCV CO2 emissions g China factor coefficient (TJ/unit (Fraction Grid (kgCO2/TJ) (tCO2) ) ) E = A B C D A*B*D/1000 1,869.2 7,638.8 2,999.7 1,712.2 325,404,287.1 Raw coal 104 Tons 2,732.15 875.40 17,827.75 209.08 1 87,300 9 7 7 7 8 Clean coal 104 Tons 0.02 0.00 0.00 0.00 0.00 0.00 0.02 263.44 1 87,300 459.97 Other washed coal 104 Tons 0.00 138.12 0.00 0.00 0.00 89.99 228.11 83.63 1 87,300 1,665,408.07 Coke 104 Tons 0.00 25.95 0.00 0.00 105.00 0.00 130.95 284.35 1 95,700 3,563,450.03 Coke oven gas 108 m3 0.00 0.00 1.15 0.00 0.00 0.36 1.51 1672.6 1 37,300 94,205.85 Other gas 108 m3 0.00 10.20 0.00 0.00 0.00 3.12 13.32 522.7 1 37,300 259,696.18 Crude oil 104 Tons 0.00 0.82 0.36 0.00 0.00 0.00 1.18 418.16 1 71,100 35,082.79 Gasoline 104 Tons 0.00 0.02 0.00 0.00 0.00 0.02 0.04 430.7 1 67,500 1,162.89 Diesel 104 Tons 1.30 3.03 2.39 0.00 1.39 1.38 9.49 426.52 1 72,600 293,861.19 Fuel oil 104 Tons 0.64 0.29 3.15 2.22 1.68 0.89 8.87 418.16 1 75,500 280,035.48 LPG 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 501.79 1 61,600 0.00 Refinery gas 104 Tons 0.71 3.41 1.76 0.00 0.78 0.00 6.66 460.55 1 48,200 147,842.08 Natural gas 108 m3 0.00 0.00 0.00 3.00 0.00 0.00 3.00 3893.1 1 54,300 634,185.99 Other petroleum 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 418.16 1 75,500 0.00 products Other coking products 104 Tons 0.00 0.00 0.00 0.00 1.50 0.00 1.50 284.35 1 95,700 40,818.44 Other E (standard coal) 104 Tce 0.00 2.88 0.00 0.00 1.74 32.80 37.42 0 1 0 0.00 Total 332,420,496.13

Σ(Ei) Data source: Fuel consumption data are from China Energy Statistical Yearbook 2006. Net calorific values are from the files mentioned above and crosschecked against China Energy Statistical Yearbook, 2008 p. 284; Oxidation factors and fuel emission coefficients are from the files mentioned above and crosschecked against IPCC default values, see 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2 (energy).

Table A4b. Calculation of CO2 emissions from fuels for thermal power production, Northwest China Grid, 2006

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Chongqin Central Oxidation Carbon CO2 Fuel Unit Jiangxi Henan Hubei Hunan Sichuan NCV g China factor coefficient emissions (TJ/unit (Fraction Grid (kgCO2/TJ) (tCO2) ) ) E = A B C D A*B*D/1000 2,454.4 3,285.2 367,386,738.0 Raw coal 104 Tons 1,926.02 8,098.01 3,179.79 1,184.30 20,127.82 209.08 1 87,300 8 2 7 Clean coal 104 Tons 0.00 0.00 0.00 0.00 0.00 5.79 5.79 263.44 1 87,300 133,160.23

Other washed coal 104 Tons 4.51 104.12 0.00 8.59 0.00 79.21 196.43 83.63 1 87,300 1,434,115.59

Briquettes 104 Tons 0.00 0.00 0.00 0.00 0.01 0.00 0.01 209.08 1 87,300 182.53

Coke 104 Tons 0.00 17.23 0.00 0.32 0.00 0.00 17.55 284.35 1 95,700 477,575.78

Coke oven gas 108 m3 0.00 0.52 1.07 4.24 0.01 0.38 6.22 1672.6 1 37,300 388,053.24

Other gas 108 m3 12.69 3.95 0.00 1.70 0.01 4.36 22.71 522.7 1 37,300 442,770.28

Crude oil 104 Tons 0.00 0.49 0.00 0.00 0.00 0.00 0.49 418.16 1 71,100 14,568.28

Gasoline 104 Tons 0.00 0.01 0.00 0.00 0.00 0.00 0.01 430.7 1 67,500 290.72

Diesel 104 Tons 0.91 2.23 1.41 1.78 0.00 0.96 7.29 426.52 1 72,600 225,737.42

Fuel oil 104 Tons 0.51 1.26 1.31 0.80 3.49 0.57 7.94 418.16 1 75,500 250,674.38 LPG 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 501.79 1 61,600 0.00 Refinery gas 104 Tons 0.86 8.10 1.00 0.97 0.00 0.00 10.93 460.55 1 48,200 242,629.71

Natural gas 108 m3 0.00 0.00 0.28 0.00 18.63 0.16 19.07 3893.1 1 54,300 4,031,308.94 Other petroleum 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 418.16 1 75,500 0.00 products Other coking products 104 Tons 0.00 0.00 0.00 0.00 0.01 0.00 0.01 284.35 1 95,700 272.12

Other E (standard coal) 104 Tce 17.45 37.36 31.55 18.29 0.00 29.35 134.00 0 1 0 0.00 375,028,077.2 Total 8

Σ(Ei) Data source: Fuel consumption data are from China Energy Statistical Yearbook 2007, p.178-214. Net calorific values are from the China Energy Statistical Yearbook, 2008 p. 284; Oxidation factors and fuel emission coefficients are IPCC default values; see 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2 (energy).

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Table A4c. Calculation of CO2 emissions from fuels for thermal power production, Central China Grid, 2007. Chongqin Central Oxidation Carbon CO2 Fuel Unit Jiangxi Henan Hubei Hunan Sichuan NCV g China factor coefficient emissions (TJ/unit (Fraction Grid (kgCO2/TJ) (tCO2) ) ) E = A B C D A*B*D/1000 2,200.5 2,683.8 1,547.7 410,829,403.6 Raw coal 104 Tons 9,357.00 3,479.81 3,239.00 22,507.89 209.08 1 87,300 7 1 0 8 Clean coal 104 Tons 0.00 3.07 0.00 0.00 3.80 0.00 6.87 263.44 1 87,300 157,998.40 Other washed coal 104 Tons 0.04 87.16 0.00 2.06 96.42 0.00 185.68 83.63 1 87,300 1,355,630.93 Briquettes 104 Tons 0.00 0.00 0.00 0.00 0.00 0.01 0.01 209.08 1 87,300 182.53 Coke 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 284.35 1 95,700 0.00 Coke oven gas 108 m3 0.08 2.61 0.25 0.31 0.91 0.00 4.16 1672.6 1 37,300 259,534.00 Other gas 108 m3 29.17 25.79 0.00 24.69 0.00 23.98 103.63 522.7 1 37,300 2,020,444.06 Crude oil 104 Tons 0.00 0.43 0.00 0.00 0.00 0.00 0.43 418.16 1 71,100 12,784.41 Gasoline 104 Tons 0.00 0.00 0.00 0.04 0.01 0.00 0.05 430.7 1 67,500 1,453.61 Diesel 104 Tons 0.98 3.21 2.51 2.83 1.93 0.00 11.46 426.52 1 72,600 354,862.93 Fuel oil 104 Tons 0.42 1.25 1.33 0.63 0.64 1.74 6.01 418.16 1 75,500 189,742.19 LPG 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 501.79 1 61,600 0.00 Refinery gas 104 Tons 1.43 10.01 0.97 0.70 0.00 0.00 13.11 460.55 1 48,200 291,022.47 Natural gas 108 m3 0.00 0.12 0.18 0.00 0.20 1.87 2.37 3893.1 1 54,300 501,006.93 Other petroleum 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 418.16 1 75,500 0.00 products Other coking products 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 0.00 284.35 1 95,700 0.00 Other E (standard coal) 104 Tce 23.43 63.65 35.95 29.46 23.21 0.00 175.70 0 1 0 0.00 415,974,066.1 Total 3

Σ(Ei) Data source: Fuel consumption data are from China Energy Statistical Yearbook 2008, p.174-209. Net calorific values are from the China Energy Statistical Yearbook, 2008 p. 284; Oxidation factors and fuel emission coefficients are IPCC default values; see 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2 (energy).

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Table A5. Calculation of emissions associated with imports from North West Grid Average emission Associated CO2 Year Imports (MWh) factor emissions (tCO2) (tCO2/MWh) A B C = B * A 2006 3,028,950 0.99148 3,003,157 2007 3,005,400 1.01129 3,039,328 Table A6 Table A6

Table A6. Calculation of average emission factors of North West Power Grid 2006 2007

1 Total thermal power supply (MWh) 156,142,241 178,920,940 Table A7 Table A8 2 Total CO2 Emissions (tCO2) 154,812,639 180,940,805 Table A9a Table A9b 3 = 2/1 Average emission Factor (tCO2/MWh) 0.99148 1.01129

Table A7. Calculation of thermal power supply to North West Grid, 2006

Thermal Power Thermal power Grid generation Losses (%) supply (MWh) (MWh) C = A * (100 - B) / A B 100 1 Shaanxi 54,482,000 6.97 50,684,605 2 Gansu 35,738,000 4.29 34,204,840 3 Qinghai 7,204,000 2.57 7,018,857 4 Ningxia 36,731,000 36,731,000 5 Xinjiang 29,901,000 8.02 27,502,940 6 North West 156,142,241 C7 = C1 + C2 + C3 +

C4 + C5 + C6 Source: Original data are from China Electric Power Yearbook 2007, p. p. 559-560, 568.

Table A8. Calculation of thermal power supply to North West Grid, 2007 Thermal Power Losses Thermal power Grid generation (%) supply (MWh) (MWh) C = A * (100 - B) / A B 100 1 Shaanxi 59,100,000 6.77 55,098,930 2 Gansu 42,400,000 5.89 39,902,640 3 Qinghai 9,700,000 7.19 9,002,570 4 Ningxia 43,500,000 0.00 43,500,000

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5 Xinjiang 34,600,000 9.20 31,416,800 6 North West 178,920,940 C7 = C1 + C2 + C3 +

C4 + C5 + C6 Source: Original data are from China Electric Power Yearbook 2008, p. p. 733-734.

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Table A9a. Calculation of CO2 emissions from fuels for thermal power production, North West Grid, 2006. North Oxidation Carbon CO2 Fuel Unit NCV Shaanxi Gansu Qinghai Ningxia Xinjiang West factor coefficient emissions (TJ/unit (Fraction (kgCO2/TJ) (tCO2) ) ) E = A B C D A*B*D/100 0 8,298.6 Raw coal 104 Tons 2,834.44 1,660.92 421.86 1,833.72 1,547.69 209.08 1 87,300 151,472,271 3 Clean coal 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 263.44 1 87,300 0

Other washed coal 104 Tons 0.00 0.00 0.00 112.70 8.45 121.15 83.63 1 87,300 884,504

Coke 104 Tons 0.00 0.00 0.00 0.01 0.00 0.01 284.35 1 95,700 272

Coke oven gas 108 m3 0.20 0.00 0.00 0.00 0.08 0.28 1672.6 1 37,300 17,469

Other gas 108 m3 0.10 0.00 0.00 0.00 0.00 0.10 522.7 1 37,300 1,950

Crude oil 104 Tons 0.00 0.00 0.00 0.00 0.02 0.02 418.16 1 71,100 595

Gasoline 104 Tons 0.01 0.00 0.00 0.00 0.00 0.01 430.7 1 67,500 291

Diesel 104 Tons 1.14 0.24 0.61 0.00 1.25 3.24 426.52 1 72,600 100,328

Fuel oil 104 Tons 0.00 0.60 0.00 0.00 0.11 0.71 418.16 1 75,500 22,415

LPG 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 501.79 1 61,600 0

Refinery gas 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 460.55 1 48,200 0

Natural gas 108 m3 1.59 0.56 1.06 0.00 7.49 10.70 3893.1 1 54,300 2,261,930 Other petroleum 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 418.16 1 75,500 0 products Other coking products 104 Tons 1.86 0.00 0.00 0.00 0.00 1.86 284.35 1 95,700 50,615

Other E (standard coal) 104 Tce 33.57 8.81 0.00 0.00 2.20 44.58 0 1 0 0 Total 154,812,639

Σ(Ei) Data source: Fuel consumption data are from China Energy Statistical Yearbook 2007. Net calorific values are from the China Energy Statistical Yearbook, 2008 p. 284; Oxidation factors and fuel emission coefficients are IPCC default values; see 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2 (energy).

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Table A9b. Calculation of CO2 emissions from fuels for thermal power production, North West Grid, 2007. North Oxidation Carbon CO2 Fuel Unit NCV Shaanxi Gansu Qinghai Ningxia Xinjiang West factor coefficient emissions (TJ/unit (Fraction (kgCO2/TJ) (tCO2) ) ) E = A B C D A*B*D/100 0 9,671.2 Raw coal 104 Tons 3,303.44 1,969.03 470.85 2,165.80 1,762.11 209.08 1 87,300 176,525,905 3 Clean coal 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 263.44 1 87,300 0

Other washed coal 104 Tons 3.73 0.00 0.00 124.31 7.73 135.77 83.63 1 87,300 991,243

Briquettes 104 Tons 3.53 0.00 0.00 0.00 0.00 3.53 209.08 1 87,300 64,432

Coke 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 284.35 1 95,700 0

Coke oven gas 108 m3 0.52 0.65 0.00 0.00 0.26 1.43 1672.6 1 37,300 89,215

Other gas 108 m3 14.14 0.71 0.00 0.00 0.00 14.85 522.7 1 37,300 289,526

Crude oil 104 Tons 0.00 0.00 0.00 0.00 0.09 0.09 418.16 1 71,100 2,676

Gasoline 104 Tons 0.02 0.00 0.00 0.00 0.00 0.02 430.7 1 67,500 581

Diesel 104 Tons 1.12 0.26 0.42 0.00 1.77 3.57 426.52 1 72,600 110,546

Fuel oil 104 Tons 0.01 1.05 0.04 0.00 0.05 1.15 418.16 1 75,500 36,307

LPG 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 501.79 1 61,600 0

Refinery gas 104 Tons 0.00 0.00 0.00 0.00 5.99 5.99 460.55 1 48,200 132,969

Natural gas 108 m3 1.68 0.49 1.93 0.00 8.66 12.76 3893.1 1 54,300 2,697,404 Other petroleum 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 418.16 1 75,500 0 products Other coking products 104 Tons 0.00 0.00 0.00 0.00 0.00 0.00 284.35 1 95,700 0

Other E (standard coal) 104 Tce 94.36 9.73 0.00 0.00 0.00 104.09 0 1 0 0 Total 180,940,805

Σ(Ei) Data source: Fuel consumption data are from China Energy Statistical Yearbook 2008. Net calorific values are from the China Energy Statistical Yearbook, 2008 p. 284; Oxidation factors and fuel emission coefficients are IPCC default values; see 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Volume 2 (energy).

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Table A10. Calculation of the BM Emission Factor, Central China Grid

EFthermal Share of thermal power in EFBM (tCO2/MWh) (tCO2/MWh) added capacity, 2007-2005 A B C = A * B 0.82130 70.64% 0.5802 Table A11 Table A14

Table A11. Calculation of EF thermal EF λ EF thermal adv calculation A B C = A * B 1 Coal 99.13% 0.82488189 0.8177 Table A13 Table A12 2 Gas 0.74% 0.39104 0.00289 Table A13 Table A12 3 Oil 0.13% 0.54371 0.00073 Table A13 Table A12

4 EFthermal 0.82130

Table A12. Calculation of Emission factors of fuel using advanced technologies Carbon Oxidation Fuel Efficiency (%) coefficient EF (tCO2/MWh) factor adv (kgCO2/TJ) D=(3.6/(A*1000000))*B* A B C C Coal 38.10% 87,300 1 0.8249 Gas 49.99% 54,300 1 0.3910 Oil 49.99% 75,500 1 0.5437 Source: Files downloaded and mentioned above.

Table A13. Calculation of λs for the calculation of the BM, Central China Grid. Total energy Central Oxidation Carbon CO2 Fuel Unit NCV consumption China factor coefficient emissions Central China (TJ/unit (Fraction Grid TJ (kgCO2/TJ) (tCO2) ) ) E = A B C D A*B*D/1000 Raw coal 104 Tons 22,507.89 209.08 4,705,949.64 1 87,300 410,829,404 Clean coal 104 Tons 6.87 263.44 1,809.83 1 87,300 157,998 Other washed coal 104 Tons 185.68 83.63 15,528.42 1 87,300 1,355,631 Briquettes 104 Tons 0.01 209.08 2.09 1 87,300 183

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Coke 104 Tons 0.00 284.35 0.00 1 95,700 0 Other coking products 104 Tons 0.00 284.35 0.00 1 95,700 0 4,723,289.9 412,343,21 Coal, total 1 8 6 Coke oven gas 108 m3 4.16 1672.6 6,958.02 1 37,300 259,534 Other gas 108 m3 103.63 522.7 54,167.40 1 37,300 2,020,444 LPG 104 Tons 0.00 501.79 0.00 1 61,600 0 Refinery gas 104 Tons 13.11 460.55 6,037.81 1 48,200 291,022 Natural gas 108 m3 2.37 3893.1 9,226.65 1 54,300 501,007 Gas total 76,389.87 1 3,072,007 Crude oil 104 Tons 0.43 418.16 179.81 1 71,100 12,784 Gasoline 104 Tons 0.05 430.7 21.54 1 67,500 1,454 Diesel 104 Tons 11.46 426.52 4,887.92 1 72,600 354,863 Fuel oil 104 Tons 6.01 418.16 2,513.14 1 75,500 189,742 Other petroleum 104 Tons 0.00 41816 0.00 75,500 0 products 1 Oil total 7,602.40 558,843 415,974,06 Total 6

Σ(Ei)

Lambda λcoal 99.13% λgas 0.74% λoil 0.13%

Table A14. Calculation of the share of thermal power in recently added capacity

Capacity Share in added in Installed capacity 2005 2006 2007 added 2007- capacity 2005 A B C D=C-A 32,412.8 Thermal (MW) 60,167.20 76,658.00 92,580.00 70.64% 0 13,444.8 Hydropower (MW) 48,205.20 52,518.00 61,650.00 29.30% 0 Nuclear (MW) 0.00 0.00 0.00 0.00 0.00% Other (MW) 24.00 41.00 51.00 27.00 0.06% 108,396.4 129,217.0 154,281.0 45,884.6 100.00 Total (MW) 0 0 0 0 % Percentage of 2007 capacity 70.26% 83.75% 100.00% Source: China Electric Power Yearbook 2006- 2008

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2007 Installed capacity

Chongqin Sichuan Power type Unit Jiangxi Henan Hubei Hunan Total g g Thermal MW 9,270 38,540 13,040 13,360 6,370 12,000 92,580 power Hydropower MW 3,570 2,740 24,020 9,220 2,240 19,860 61,650 Nuclear MW 0 0 0 0 0 0 0 Others MW 0 0 10 17 24 0 51

Total MW 12,840 41,280 37,070 22,597 8,634 31,860 154,281

2006 Installed capacity

Chongqin Power type Unit Jiangxi Henan Hubei Hunan Sichuan Total g Thermal MW 6,568 32,603 11,623 10,715 5,594 9,555 76,658 power Hydropower MW 3,288 2,553 18,320 8,648 1,979 17,730 52,518 Nuclear MW 0 0 0 0 0 0 0 Others MW 0 0 0 17 24 0 41

Total MW 9,856 35,156 29,943 19,380 7,597 27,285 129,217

2005 Installed capacity

Chongqin Power type Unit Jiangxi Henan Hubei Hunan Sichuan Total g Thermal MW 5,906.0 26,267.8 9,526.3 7,211.6 3,759.5 7,496.0 60,167.2 power Hydropower MW 3,019.0 2,539.9 17,888.9 7,905.1 1,892.7 14,959.6 48,205.2 Nuclear MW 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Others MW 0.0 0.0 0.0 0.0 24.0 0.0 24.0

108,396. Total MW 8,925.0 28,807.7 27,415.2 15,116.7 5,676.2 22,455.6 4

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Annex 4

MONITORING INFORMATION

Selection procedure: The monitoring officer will be appointed by Dechang Xinma Hydropower development Co., Ltd. The monitoring officer will be selected from among the senior technical or managerial staff. Before he/she commences monitoring duties, he/she will receive training on monitoring requirements and procedures by Caspervandertak Consulting and/or Gansu Tonghe Investment Project Consulting. .

Tasks and responsibilities: The monitoring officer will be responsible for carrying out the following tasks: Supervise and verify metering and recording: The monitoring officer will coordinate with the plant staff to ensure and verify adequate metering and recording of data, including power delivered to the grid. Collection of additional data, sales / billing receipts: The monitoring officer will collect sales receipts for power delivered to the grid, billing receipts for power delivered by the grid to the hydropower station and additional data such as the daily operational reports of the hydropower station. Calibration: The monitoring officer will coordinate with staff of the project entity to ensure that calibration of the metering instruments is carried out periodically in accordance with regulations of the grid company. Calculation of emission reductions: The monitoring officer will calculate the annual emission reductions on the basis of net power supply to the grid. The monitoring officer will be provided with a calculation template in electronic form by the project‟s CDM advisors. Preparation of monitoring report: The monitoring officer will annually prepare a monitoring report which will include among others a summary of daily operations, metering values of power supplied to and received from the grid, copies of sales/billing receipts, a report on calibration and a calculation of emission reductions.

Support: The monitoring officer will receive support from Caspervandertak Consulting and Gansu Tonghe Investment Project consulting in his/her responsibilities through the following actions: Initial training on CDM, monitoring methodology, monitoring procedures and requirements and archiving Provide the monitoring officer with a calculation template in electronic form for calculation of annual emission reductions Continuous advice to the monitoring officer on a need basis Review of monitoring reports