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Description of the Project Design Document-PDD for Zafarana Wind Project

Description of the Project Design Document-PDD for Zafarana Wind Project. Rafik Youssef Georgy Managing Director of Technical Affairs Sector-NREA Afaf Micaheal Director Of Environment and Economic studies_NREA. Clean Development Mechanism.

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Description of the Project Design Document-PDD for Zafarana Wind Project

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  1. Description of the Project Design Document-PDD for Zafarana Wind Project Rafik Youssef Georgy Managing Director of Technical Affairs Sector-NREA Afaf Micaheal Director Of Environment and Economic studies_NREA

  2. Clean Development Mechanism • Aids sustainable development of the host country.(Technology, environment, additional revenue). • Host country contributes to global GHG reduction. • Allows sponsor country to meet emission reduction obligations.

  3. CDM - KYOTO CRITERIA • Contributes to the sustainable development of the host country. • Results in emission reductions that would not have happened otherwise. • Generates real, measurable and long-term climate change mitigation benefits. • Approved by parties involved. • Credits potentially earned from 2000 onward (through 2008-2012).

  4. PROJECT DESIGNDOCUMENT (PDD) • General description of project activity. • Baseline methodology. • Duration of the project activity / Crediting period. • Monitoring methodology and plan. • Calculation of GHG emissions by sources. • Environmental Impacts. • Stakeholders comments.

  5. Zafarana Wind Power Plant Project as a CDM • 120MW capacity with good wind conditions. • More than 400Gwh of electricity per year. • Around 100 000 TOE Saved yearly. • About 250,000 t of Certified Emission Reductions (CERs) if designated as CDM. A cooperation project between NREA of Egypt and JBIC of Japan who Supports project financing.

  6. CDM Procedures • PDD Production • Pubic & Expert Opinions. • Host country confirmation. • Meth Panel Approval. • CDM Executive Board Approval. • Validation. • CDM Executive Board Approval. • Registration. • Monitoring. • Verification. • Certification. • CER issuance and registration.

  7. Base Iine Methodology • Presently, no approved CDM methodology to be applied for “Grid Connected wind Power Generation”. • New methodology is proposed in accordance with CDM modalities and Procedures.

  8. Base line Methodology steps The project is additional because: • There is no incentive programme to promote wind power projects currently in Egypt. • The cost for a wind power plant is higher than for conventional thermal power plants, in terms of levelised cost of KWh produced. • The economic growth in Egypt has led to stricter terms and conditions for foreign financial assistance.

  9. Base line Methodology steps(continued) The project will affect mainly Operating margin and Partly build margin. • Conservative approach which considers both equally. Combined margin ={Operating margin + [Build margin xn]}/n+1 n has been chosen to be 1 instead of 0.6 which would have been in favor of wind.

  10. Base line Methodology steps(continued) Determining Operating Margin. • Less than 20% generation comes from hydro. • More than 80% from thermal Power Plants. • Wind will replace thermal generation mix of Combined Cycle, Steam Turbines and Gas Turbines. Also conservative approach as wind would most likely replace older and/or less efficient thermal power stations.

  11. Determining Build margin • Emission rate of: • Most recent 20% plants built, or • Most recent (5) plants built gives same result. • Cairo North (2),750MW, CC, 5.3%. • Cairo North (1),750MW, CC, 5.256%. • Zafarana, 77MW, wind, 0.3%. • Suez Gulf (1,2) Boot,682M, ST 4.8%. • Port Said East (1,2), 682MW, ST 4.6%. Again Conservative Approach to Consider Wind Plant.

  12. Investment Barriers for wind Plants • No incentives for wind power generation. • Wind is more capital intensive. • Low price for natural gas. Result: Currently wind generated KWh cost cannot compete with thermal generated KWh cost. i . e Wind cannot be viewed as BAU leading to WIND NEED for CDM SUPPORT TO BE IMPLEMENTED.

  13. Monitoring Methodology • Presently there is no monitoring methodology applicable to the project. • Base Line source of emission is grid electricity which can be reasonably monitored as an indication for fuel consumption hence emissions of CO2 mainly. Duration of the project is yet to be chosen with preference to 7 years at least for the timebeing.

  14. Environmental Impacts • Noise Pollution Negligible, Being an arid area. • Visual Pollution Same, no community nearby. • Land Use Same, however, during construction fences will be erected around.

  15. Environmental Impacts • Potential impact on Migrating Birds. • Relatively of more concern. • Zafarana is close but not in a major Pathway of birds. • No green areas, fresh water nor food scraps of human activity exist as it is a remote arid area. Result: Danger is minimum and almost negligible.

  16. Conclusion: • At 5 US$ per ton CO2 & around 0.56kg CO2 avoided emissions per KWh produced from thermal power stations -Wind produced KWh will have a bonus of around 2 piasters which cannot close the gap between wind and thermal generation. • CDM cannot solely make uncompetitive projects economically attractive. • Rather, CDM can make near economic projects feasible or more attractive. The PDD document can be accessed on: http://cdm.unfccc.int/methodologies/process

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