DNV Climate Change Services Third Party Assessment of the Comprehensive Refurbishment of the Pruné řov II Power Plant Draft Report for the Ministry of the Environment of the Czech Republic Rev 1, 17 March 2010 Report PRJC-211800-2010-CCS-BEL . 17/03/2010 DNV CLIMATE CHANGE SER VICES Third Party Assessment of the Comprehensive Refurbishment of the Pruné řov II Power Plant Date of first issue: Project No.: 17 March 2010 PRJC-211800-2010-CCS-BEL Approved by: Organisational unit: Luc Larmuseau DNV Climate Change Services Client: Client ref.: Ministry of the Environment of the Czech Republic Summary: DNV was contracted by the Ministry of the Environment of the Czech Republic to conduct an independent assessment of the refurbishment project of the Pruné řov II power plant, as proposed by Čez a.s. in June 2008. The scope of work was limited to a technical and environmental evaluation of the proposed project, and did not include economical or strategic analyses, comparison of alternative scenarios, or the formulation of recommendations. A team of four international experts, supported by a local expert, conducted the work during February – March 2010. The assessment was divided in three parts: • In Part A, all relevant project aspects were compared against the BAT requirements of the LCP- and the EE-BREF. For each requirement, compliance was discussed and a more in-depth analysis was performed for deviations. • Part B comprises two parts, i.e. the evaluation of the EIA procedure on the one hand, and the evaluation of the EIA report on the other. • The impact of deviations from BREF in terms of CO 2, as observed in Part A, was calculated in Part C. The proposed project complies with nearly all requirements of the LCP and the EE BREF. Deviations from the BREF were observed in terms of the proposed net unit efficiency and CO-emission. The technical information provided did not support the deviations from BREF. The EIA procedure for the project was conducted in line with the requirements of the applicable act, and was done in a transparent manner. The EIA report adequately shows improvement of the environmental quality for most factors and areas. Items of concern are: local deterioration of air quality, the absence of the asbestos and contaminated land survey data in the project documentation, and inconclusive information on potential seepage from energy by-products. The CO 2-impact of the deviation from BREF was quantified based on the EU ETS MRG approach. Report No.: Subject Group: Indexing terms Report title: Keywords Service Area Third party assessment of the comprehensive BREF, Czech Republic, All refurbishment of the Pruné řov II Power Plant Power Plant, EIA,CO2, lignite, efficiency, CO Market Sector All Work carried out by: Bart Adams Unrestricted distribution (internal Lumír Nemecek and external) Mark Purcell Barbara Toole ‘O Neil Unrestricted distribution within Jan Van Evercooren DNV Work verified by: Limited distribution within DNV Stein B Jensen after 3 years Luc Larmuseau Date of this revision: Revision No.: Number of pages: No distribution (confidential) 17/3/10 1 119 © 2002 Det Norske Veritas AS All rights reserved. This publication or parts thereof may not be reproduced or transmitted in any form or by any means, including photocopying or recording, without the prior written consent of Det Norske Veritas AS. 2 / 119 17/03/2010 DNV CLIMATE CHANGE SER VICES Third Party Assessment of the Comprehensive Refurbishment of the Pruné řov II Power Plant Executive Summary In June 2008, Čez a.s. submitted a proposal for the comprehensive refurbishment of three of the five blocks of the Pruné řov II Power Plant to the Ministry of the Environment (MoE). The scope of the refurbishment includes renewal of all core process components of the facility, as well as an upgrade of the common fuel, limestone and residue handling systems. The MoE contracted DNV to provide an independent assessment of the technical and environmental aspects of the proposed project, with as primary objectives: - To assess compliance of the proposed project against BREF, and to evaluate if local technical grounds could justify deviations from BREF, - To evaluate the EIA of the project, and to compare it to best practice within Europe, and - To quantify the impact of deviations from BREF in terms of CO 2 emissions. Correspondingly, the assessment was split in three parts. DNV’s scope was limited to a technical and environmental evaluation of the proposed project, and excluded economical analyses, comparison of alternatives, or the formulation of recommendations. The work was performed in February – March 2010 by four international DNV experts, supported by one local DNV expert. The conclusion of the first part of the assessment is that the proposed project complies with most requirements from the relevant BREF documents. Two non-compliances were observed. First, the proposed net unit efficiency of 40% is below the minimal requirement of 42%, and the corresponding local technical grounds to support this deviation have insufficiently been explored. Although outside of the scope of the current assessment, significant economical and strategic considerations in this respect have been highlighted. Second, the proposed emission limit for CO of 250 mg/Nm³ exceeds the BAT ELV of 200 mg/Nm³, with insufficient technical grounds to support this deviation. The conclusion of the second part of the assessment is that the EIA process for the proposed project was in line with the legal requirements, and that adequate transparency was provided. With respect to the EIA documentation, only a basic assessment of other alternatives is included before ruling them out. This is not good practice, but it is consistent with what is seen in many EIA’s. However, at the request of the MoE and other stakeholders, more detailed information was provided to justify why a higher efficiency alternative was not considered further. This more detailed information would normally in terms of its extent and type satisfy the requirements of EIA for the justification of submitting only one alternative. However, the adequacy of ČEZ’ arguments in terms of their content and quality is appraised in detail in the first part of this assessment. With regard to the key environmental issues, DNV agree with the EIA Documentation that for most impact generating factors and impact receiving areas, the project leads to improved environmental quality compared against the reference situation. Issues of concern are the local deterioration of air quality close to the EPR II plant, the absence of the asbestos and contaminated land survey data in the project documentation, and the insufficient evidence regarding the acceptable future impact from seepage water from the stabilised EBP. Finally, in the third part of the assessment, the impact in terms of CO 2 emission of the deviation from the BAT-requirement on net unit efficiency was calculated by means of the method prescribed by the EU ETS MRG. For stable operation during 6,300 hours per year at nominal capacity of all three of the refurbished blocks (i.e. a total electrical capacity of 3 x 250 MW el), the impact in terms of CO 2 emission is calculated as 205,082 tons of CO 2 per year. 3 / 119 17/03/2010 DNV CLIMATE CHANGE SER VICES Third Party Assessment of the Comprehensive Refurbishment of the Pruné řov II Power Plant Contents 1. Introduction ....................................................................................................6 2. Situation ..........................................................................................................7 3. Assessment Approach...................................................................................9 3.1. Part A – BREF Compliance Assessment..........................................................9 3.2. Part B – EIA Evaluation....................................................................................9 3.3. Part C – Calculation of CO 2 Impact ..................................................................9 4. Assessment Team........................................................................................10 5. Methodology .................................................................................................11 5.1. Part A – BREF Compliance Assessment........................................................11 5.2. Part B – EIA Evaluation..................................................................................12 5.3. Part C – Calculation of CO 2 Impact ................................................................12 6. Document Overview .....................................................................................13 7. Results ..........................................................................................................14 7.1. Part A – BREF Compliance Assessment........................................................14 7.1.1. Heat rate / Net unit efficiency....................................................................................16 7.1.2. CO emission limit......................................................................................................20 7.2. Part B – EIA Evaluation..................................................................................20 7.2.1. Findings regarding EIA process................................................................................20 7.2.2. Findings regarding the EIA documentation ...............................................................21 7.2.2.1. Project design...........................................................................................................21