PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03 CDM – Executive Board CLEAN DEVELOPMENT MECHANISM PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) Version 03 - in effect as of: 22 December 2006 CONTENTS A. General description of the small scale project activity B. Application of a baseline and monitoring methodology C. Duration of the project activity / crediting period D. Environmental impacts E. Stakeholders’ comments Annexes Annex 1: Contact information on participants in the proposed small scale project activity Annex 2: Information regarding public funding Annex 3: Baseline information Annex 4: Monitoring Information 1 PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03 CDM – Executive Board Revision history of this document Version Date Description and reason of revision Number 01 21 January Initial adoption 2003 02 8 July 2005 • The Board agreed to revise the CDM SSC PDD to reflect guidance and clarifications provided by the Board since version 01 of this document. • As a consequence, the guidelines for completing CDM SSC PDD have been revised accordingly to version 2. The latest version can be found at <http://cdm.unfccc.int/Reference/Documents>. 03 22 December • The Board agreed to revise the CDM project design 2006 document for small-scale activities (CDM-SSC-PDD), taking into account CDM-PDD and CDM-NM. 2 PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03 CDM – Executive Board SECTION A. General description of small-scale project activity A.1 Title of the small-scale project activity: Yeghegis small-scale hydro project - Version 3 - Completed: 21.8.2007 A.2. Description of the small-scale project activity: The project The purpose of the project is to install and operate a second turbine of 3.75 MW (3,750 KW) at the small scale hydropower plant on the upper flow of the Yeghegis river. The electricity will be supplied to the national grid of Armenia. The project will be implemented by Bazenc, a Closed Joint Stock Company established in 2000. A first turbine at Yeghegis has already been installed and is operational. This first turbine will not be part of this CDM project. The second turbine was included in the original business plan, but without the CDM it was not possible to finance that turbine. This is mainly because this turbine will only operate during a wet season of approximately two and a half months and thus produces much less MWh than the first turbine. The first turbine produces about 25,000 MWh, while the second one will produce about 7296 MWh. The already installed turbine has a capacity of 6.2 MW and the second turbine 3.75 MW. The planned total installed capacity at the project site is therefore 9.95 MW, allowing the production of an estimated total of 32.3 million KWh (32,300 MWh) per year. The project has been under development since late 2004. It has since been extremely difficult to find the necessary grid data to calculate an appropriate grid emission factor. The energy sector With no oil and gas reserves, Armenia used to rely on supplies from Russia as the main source of electricity generation. Despite Armenia’s large hydropower potential, in 1988 thermal power plants (TPP) produced 59% of gross electricity production; the Armenian Nuclear Power Plant (ANPP) produced 31%, and hydropower plants (HPP) only 10%. Energy supply became a critical issue for Armenia in late 1991, when Azerbaijan shut down the main pipeline transporting Russian gas to Armenia and the railroad. This meant that a smaller pipeline through Georgia, which was subject to disruption, remained the only source of natural gas supplies used for electricity generation and heating. The ensuing energy crisis was the major motivation for the Government of Armenia to re-open the ANPP, which had been shut down after the 1988 earthquake. This alleviated the immediate energy shortfall, but this Soviet-designed facility is considered inherently unsafe by international nuclear regulatory agencies despite extensive safety improvements made in recent years. For this reason, the ANPP is expected to be shut down, but more capacity on the grid is needed first. 3 PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03 CDM – Executive Board Increased output from large scale hydro plants after the energy crisis has resulted in the falling of the water level in the country’s largest lake Sevan to ecologically dangerous levels. Utilization of small scale hydro potential elsewhere would contribute to the production capacity required, without further reducing the water level in lake Sevan. Sustainable development The project contributes to sustainable development in Armenia. Specifically, the project: - Diversifies the sources of electricity generation and decreases dependence on imported natural gas. The increase in capacity by this project can also be a small contribution to the capacity that is required to shut down the Armenian Nuclear Power Plant (ANPP). This Soviet-designed facility is considered inherently unsafe and should be shut down. However, this is not possible yet as there is insufficient capacity on the grid. - Since the installation of the second turbine was considered during the construction for the first turbine, most preparations for the installation of the second turbine have already been made and no further large-scale construction work is required. The environmental impact of the installation of a second project at the existing site can therefore be considered minimal. - Ensures a minimum ecological waterflow of 0.29m3/sec to ensure environmental stability of the river in line with the legal obligation stipulated by the Ministry of Nature Protection of the Republic of Armenia in its environmental impact assessment. - Helps the Armenian Government to achieve the goal of increasing hydro and other renewable energy. - Increases employment opportunities to local people both during construction and operation of the project in the area where the project is located. - Increases funds for the municipality of Vardahovit via the land-lease contracts, land taxes and also property tax on the equipment that is installed. A.3. Project participants: Name of Party involved Private and/or public entity(ies) Kindly indicate if the Part ((host) indicates a host project participants involved wishes to be considered Party) (as applicable) as project participant (Yes/No) Armenia (host) Bazenc CJSC No Bazenc is a Closed Joint Stock Company established in 2000 and registered in Yerevan, Armenia. The Company’s short-term goal is the construction of a small hydropower plant and organization of electricity production in Armenia. Bazenc has the same owners as the Arpa-Sevan Corporation, a construction company specialized in large scale infrastructure construction. Arpa-Sevan has built several important tunnels in Armenia, including the 48 km tunnel connecting the river Arpa to lake Sevan. A.4. Technical description of the small-scale project activity: 4 PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03 CDM – Executive Board The project will install and operate a second vertical four-nozzle 1060/P 2.6 CII-type Pelton turbine with a maximum power of 3.75 MW (3,750 KW) at the small scale hydropower plant on the upper flow of the Yeghegis river. This turbine will only operate during a wet season of approximately 2.5 months (1824 hours) and will produce about 7296 MWh per year. The planned total installed capacity of the entire facility, including both turbines, is 9.95 MW, allowing the production of an estimated 32.3 million KWh (32,300 MWh) per year. The electricity will be supplied to the national grid of Armenia. A.4.1. Location of the small-scale project activity: A.4.1.1. Host Party(ies): Armenia A.4.1.2. Region/State/Province etc.: Vayk Marz A.4.1.3. City/Town/Community etc: Vardahovit A.4.1.4. Details of physical location, including information allowing the unique identification of this small-scale project activity : The Yeghegis project is located at 39º55’37.2” North; 45º30’15.5” East on the upper flow of the Yeghegis River between villages Gyadikvank and Vardahovit in the Yeghegnadzor area of Vayk marz. Bazenc leased 25 ha of land from reserve lands that belong to village Vardahovit to carry out the construction. The headworks site is in the canyon of the Yeghegis river 500m south west of the village Gydikvank. The plant is located 3,800 m down the flow of the river 300m to the east of the village Vardahovit near the intake structures of the Arpa-Sevan tunnel. A.4.2. Type and category(ies) and technology/measure of the small-scale project activity: According to the simplified modalities and procedures for small-scale CDM project activities, the Yeghegis Small Scale Renewable Energy Project falls under the Type/Category (i) D. (Renewable Energy Projects / Electricity generation for a system). The project conforms to the project category since the nominal installed capacity is below the 15 MW threshold and the plant will sell its generated electricity to the grid. It will not increase beyond 15 MW at any point during the crediting period. The Yeghegis project only involves the installation of a second turbine, which had already been taken into account in the original design for construction of the project. The turbine will be identical to the first turbine, a vertical four-nozzle 1060/P 2.6 CII-type Pelton turbine with a maximum power of 3.75 MW (3,750 kW). 5 PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03 CDM – Executive Board A.4.3 Estimated amount of emission reductions over the chosen crediting period: Total annual emission reductions from the electricity generated by the project are estimated as 3,166 tCO2e per year, or 22,159 tCO2e over a 7 year crediting period. For details, please refer to Section B.