GHG emission reductions through implementation of grid-connected Yazd 1 Combined Cycle Power Plant
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Host party(ies) Iran (Islamic Republic of)
Methodology(ies) AM0029 ver. 3
Standardised Baselines N/A
Estimated annual reductions* 801,546
Start date of first crediting period. 01 Jan 13
Length of first crediting period. 10 years
DOE/AE SIRIM
Period for comments 08 Nov 12 - 07 Dec 12
PP(s) for which DOE have a contractual obligation Yazd Power Generation Company, FARAB Co.
The operational/applicant entity working on this project has decided to make the Project Design Document (PDD) publicly available directly on the UNFCCC CDM website.
PDD PDD (3229 KB)
Local stakeholder consultation report: N/A
Impact assessment summary: N/A
Submission of comments to the DOE/AE Compilation of submitted inputs:
1.	DOE has to check the alternative for baseline - Gas as the fuel but with different alternative technologies has been evaluated and dropped on based on the explanation “the option has lower system efficiency” in comparison to the power generation using Combined Cycle mode of operation. An appropriate explanation and documentation to support the exclusion of such scenario is not provided. 

2.	DOE has to check the assumptions for the techno economic parameters for the project activity and the baseline with respect to EB guidelines on investment analysis and justify their conservativeness.

3.	It is observed that the baseline alternatives presented do not satisfy the requirement of the methodology indicated above fully. For Example, exclusion of NG based open cycle power plant is not explained with any reasons. Possibility and constraints if any in import of electricity from connected grids is not discussed. Technology details, efficiency and technical lifetime are not indicated for plausible alternatives.

4.	DOE has to validate the sensitivity analysis has not been done based on EB guidelines.

5.	Further as per the methodology, a sensitivity analysis shall be performed for all alternatives, to confirm that the conclusion regarding the financial attractiveness is robust to reasonable variations in the critical assumptions (e.g. fuel prices, load factor, project cost, and tariff ).This has not been done.

6.	The applicability of the following to the project in not justified in the PDD with respect to requirements of the methodology AM0029 
•	Natural gas is sufficiently available in the region or country, e.g. future natural gas based power capacity additions, comparable in size to the project activity, are not constrained by the use of natural gas in the project activity.
•	Out of the applicable conditions, justification in respect of sufficient availability of natural gas is not clearly spelt out by the Project proponent considering other NG based power plants contemplated in the region by Government of Iran plan under power development scheme. It is merely indicated that ‘even considering other possible demands for natural gas in the area, the supply greatly exceeds the demand for the proposed project’.

7.	The Webhosted PDD does not justify the basis on which all the possible realistic and credible alternatives that provide outputs or services comparable with the proposed CDM project activity are identified. Also the basis on the exclusion of the available alternatives to arrive at the contenders for the baseline has not been substantiated by means of references and supporting documents.

8.	The common practice analysis in the PDD does not substantiate the following with relevant evidences:
•	Analysis of other activities similar to the proposed project activity”. 
•	“Provide an analysis of any other activities that are operational and that are similar to the proposed project activity. (same country/region and/or rely on a broadly similar technology, are of a similar scale, and take place in a comparable environment with respect to regulatory framework, investment climate, access to technology, access to financing, etc)”

9.	The Leakage calculations in the PDD are not in conformance with the requirements of AM0029.

10.	PP has to  clarify,
•	The applied methodology has been basically written considering open market / free trade conditions.
•	In case of Iran context where there is some sort of Govt. control in allocation and prioritization of supply of NG for/among different Industry.
•	The underlying policy has Not been  discussed with respect to the effect of these policy on baseline & associated leakage (if any)
•	The allocation of gas (by Republic of Iran) has been linked to the availability of Gas in abundance. 
•	PDD does not conclusively rule out the possibility of a possible leakage.
•	However it has not been demonstrated how LNG would be monitored in case it is used.
Submitted by: Asadulla Beig

	The argument for opting out of other energy sources from the baseline is not adequately demonstrated in the PDD. Where is the proof for each of the argument? PP has duty to provide to all the points it raised to opting out of renewable and other sources.  The reason for excluding the power generation using natural gas with different technologies is not clear. It is mentioned in the PDD that the project activity is a combined cycle power plant with the modern state of art technology and significant efficiency improvement is not possible with current technology status to reduce GHG intensity any further. As CCPP is very efficient technology there are no higher efficient technologies available to the project proponent for power generation utilizing natural gas.

	PP has selected the input parameters in such a way that the project becomes additional. There are reports available in the Published literature state that the cost differs only by 5-10%.

	How GHG emissions will be reduced on account of the proposed project activity is not provided in the PDD.

	What is the power demand of the plant? What is the source of power prior to project activity? It is not clear whether only grid was the source before implementation of the proposed project activity. 

	 Provided data unit for net calorific value of natural gas is wrong DOE has to validate, refer section B.6.2.

	Why the PP did not mention other barriers like technical, Infrastructure barrier etc. for the additionality.

	No plan has been submitted regarding use of 2% of the net revenue accrued from the sale of CER toward achieving the sustainable development goals.

	The investment analysis is incomplete and fails to provide the data and assumptions necessary for reader to reproduce the result.

	No information has been provided regarding the cost of fuel switch in the PDD.

	The PDD does not explain about identified training, monitoring and maintenance as per the Technology requirements for contractors / engineers by the client. There is no mention of field quality Assurance systems & procedures that are available at site, field quality plans and their approval.

	Chronology of events with corresponding emails, letters need to be validated by DOE.

	The leakage calculation is not correct as per applied meth AM029.

	Project proponent conveniently hides the past history of the project and presents it as if it is a new project. DOE to check the prehistory of the project.

	DOE to check the DPR, tender documents inviting proposals, tender correspondence, proposals etc. to clearly validate.

	The DOE is therefore requested to critically analyze how the accelerated depreciation benefit has been taken into account and confirm the accounting of the cash inflows as a result of the negative tax liability in the initial years. DOE should not be misguided by the financial presented by the PP or consultant which are custom made for CDM purposes and not the actual financial considered at the investment decision. 

	Whether uninterrupted supply of Natural Gas has been ensured from suppliers for continuous operation? Whether gas will be provided from existing network of pipeline or modification is needed?

	Host country is already encouraging sustainable development on basis of clean technology and cleaner fuel, in this case how this project meet additionality criteria of CDM process?

	Whether Environment Public Hearing as process of Environment Clearance was arranged for this gas based power plant? If yes, what were major discussion and decisions of Environment Public Hearing?

	The methodology considers a project additional under the following circumstances

a)	There is a more economically attractive and GHG intensive alternative available to the project activity (lower levelized cost when compared to the project activity); and
b)	The project on a standalone basis is not financially attractive (low IRR as compared to standard industry benchmark)

While the PP has demonstrated that there is a more economically attractive option available as compared to the project activity, it has not demonstrated that the project on a standalone basis is not financially viable . As the project activity involves displacement of power on the grid and the alternative can be set up by any other entity as well, it needs to undertake a benchmark analysis. In order to perform benchmark analysis, the PP needs to take into account the tariff that it receives from the sale of power. 



Submitted by: Asadulla Beig

The proposed project activity is a fabricated and fake CDM project and must be rejected by the DOE. Regarding start date DOE to check the all original s of purchase orders, offer letters, invoices, payment proofs. DOE has to check the PDD the start date is TAMPERED. This project start date is before august 2008, I am requesting to DOE check all the original documents at Project participant’s office (Spot check) and supplier’s invoices.
DOE must terminate this project and DOE must not support this kind of forgeries and malpractices.
Submitted by: Zoroaster


The comment period is over.
* Emission reductions in metric tonnes of CO2 equivalent per annum that are based on the estimates provided by the project participants in unvalidated PDDs