M-DEV0284: Application of “Tool for the demonstration and assessment of additionality” instead of the “Combined tool” for a project activity where one of the alternatives is not an available option to the PPs.

ACM0006 ver. 6: Consolidated methodology for electricity generation from biomass residues

The project activity ‘DSW Bagasse RE Project’ is under validation and it uses the approved methodology ACM0006 version 9 (whereas GSP version PDD applied version 6.2 of the same methodology2). The methodology requires that the PP determines baseline scenarios of its project by using the ‘combined tool to identify the baseline scenario and demonstrate additionality, version 2.2’. At the same time paragraph 2 of the tool states that:

“Methodologies using this tool are only applicable if all potential alternative scenarios to the proposed project activity are available options to project participants.”

And footnote 1 in the tool states that:

“In cases where one or more alternatives are not available options to project participants, a different procedure than provided here would be required to demonstrate additionality and identify the baseline scenario. Such cases might include grid-connected power projects (where an alternative might be electricity produced by other facilities not under the control of project participants) or other projects that increase the delivery of a given product to a local, regional or global market. In such cases, baseline scenarios might be rather complex (such as the combined margin scenario in ACM0002), and the methods for comparing alternatives may differ from those provided here (e.g. benchmark analysis or other methods that utilize information about the markets in which such projects might compete). The Meth Panel is considering whether expanding this tool to cover all cases would be appropriate. In the meantime, methodologies that typically involve alternatives are not under the control of project participants can continue to use, if desired, the additionality tool (provides benchmark and other tools), and provide their own methods to develop and/or assess baseline scenario. ”

Given the conditions the project activity falls under the two following power baseline scenarios:

P2: The continuation of power generation in an existing biomass residue fired power plant at the project site, in the same configuration, without retrofitting and fired with the same type of biomass residues as (co-) fired in the project activity
P4: Generation of power in the grid

In line with the guidance outlined above, it is evident that alternative P4 is not under the control of the project participant and hence the combined tool is not applicable.
A similar clarification regarding this was raised by TUV SUD on 28/8/2008:
http://cdm.unfccc.int/UserManagement/FileStorage/19S8DEPJ5BDEKUSOEF6ALPT6JUAFD4

In response to the clarification, the meth panel suggested to await the release of the new version of ACM0006. However, the later versions (versions 7, 8 and 9) of the methodology have no new provisions.
Therefore, in order to proceed with the validation, we seek a deviation from the EB to allow us to use the additionality tool in place of the combined tool for the demonstration of additionality for this project that is under validation. The baseline will still be determined using the combined tool.

*1 http://cdm.unfccc.int/UserManagement/FileStorage/U5JYN3GEIK1HF74VPMR96AC0BZLD8O
*2 http://cdm.unfccc.int/UserManagement/FileStorage/Z6BPV3VIRQ78TCDIO62YT2DU9JYDAQ

The DOE has identified that the PPs approach in the identification of baseline scenario and demonstration of additionality using the combined tool is not appropriate since one of the alternative baseline scenarios (i.e. P4, generation of power in the grid) is not under the control of the project participants.

Therefore going by the recommendation of the Meth Panel i.e. AM_CLA_1203, the DOE is requesting for a deviation with a view to apply Tool for the demonstration and assessment of additionality for the project activity. In doing so PPs will still select the baseline scenario for biomass residues and heat supply using the combined tool, as currently described in ACM0006.

Such an approach can be stated to be in line with the one used in the approved methodology ACM0002.
The deviation does not require an amendment to the approved methodology used by the proposed project activity.

The use of the additionality tool instead of the combined tool will not impact the number of CERs generated by the project activity.