M-DEV0283: Deviation request to allow use of AM0024 for a project activity where waste heat from the clinker production process as well as from another waste heat source is used to generate electricity.

AM0024 ver. 2: Baseline methodology for greenhouse gas reductions through waste heat recovery and utilization for power generation at cement plants

Maple Leaf Cement Factory Limited (hereafter referred to as MLCFL) is the third largest cement producer in
Pakistan. MLCFL cement plant at Iskanderabad includes two phases. Phase II of the plant has two kilns; kiln 1 of
4000 TPD and kiln 2 of 6700 TPD. Both kilns are fossil fuel based and utilize coal, HFO, natural gas and diesel as
fuel. Phase II of the plant has a dedicated grid connection of 40 MW. The cement plant also has a fossil fuel (HFO
and natural gas) based captive power plant which has 4 Niigata engines (4 x 5.96 MW) and one Wartsila engine
(16.4 MW).
Waste heat is available from the clinker production process and the exhaust of the Wartsila engine. In absence of the
project activity, this waste heat was and would continue to be vented to the atmosphere (with the exception of a very
small fraction being used to pre-heat incoming raw material and fuel).
The project activity is implemented at Phase II of the plant and consists in the installation of six Heat Recovery
Steam Generators (HRSGs) having total capacity of 70.4 TPH that will use the waste heat to produce steam that will
be fed into a 16.5 MW steam turbine. The project activity does not deliver any waste heat outside the clinker
production process. Both the heat from clinker production process and Wartsila engine will contribute,
proportionally, to generate power that will be used inside the cement plant (there is only one steam turbine
processing the steam produced by the HRSGs using the waste heat sources from both sources. There is no electricity
export). Approximately 90% of the energy input in the steam turbine comes from the clinker production process,
while the remaining 10% is from the Wartsila engine. The electricity generated by the project will partially displace
the grid electricity import of phase II of the plant. The electricity generated will not displace the electricity from the
captive power plant, because in Pakistan grid electricity is not reliable, therefore the captive power plant is used as
base load and the grid complements the base load to fulfil the demand of the plant. Therefore, there is no ambiguity
about the power source that will be displaced by the project activity, as captive power generation will stay the same
as in the baseline scenario, while grid electricity import will decrease accordingly. This is also in favour of
conservativeness, being the emission factor of the grid lower than the emission factor of the captive power plant.
The displacement of electricity caused by the project activity will result in a reduction of GHG emissions at the
power plants feeding the grid, estimated at 47,807 tCO2 per year.
Methodology AM0024, which would be the most appropriate for this project activity, however, under the
“Applicability” section, states that “this methodology is applicable to project activities that use waste heat gas
generated in clinker making process (i.e. in the cement kilns) to produce electricity”. In the project activity here
presented, both waste heat gas generated in the clinker making process AND waste heat from another source (the
Wartsila engine) are used. The contribution of this second source can be measured, and in the PDD it is
conservatively proposed that the portion of electricity generated by the heat coming from the exhaust of Wartsila
engine will be ignored and emission reduction will be claimed only for the electricity generated by utilizing waste
heat coming from the clinker production process. Note that use of the waste heat from the Wartsila engine does NOT
follow under the so-called Type II Waste Heat utilization, for which provision (1) at page 2 of the methodology
clearly states that the methodology is not applicable. Rather, this waste heat would have been vented to the
atmosphere without any utilization in the existing captive power plant, cement works or for other local industrial
users or local heating schemes.
Given that, for all other aspects, methodology AM0024 is fully applicable to the present case, and only a minor,
project-specific change in the procedure for the estimation of the emissions would be necessary (none of the
equations in the methodology (and equation 7 in particular) would need to be modified once the portion of
electricity produced using the heat from the Wartsila engine has been deducted from the total electricity production),
it is here requested to deviate from the applicability condition stated above, in order to allow this specific case
to fit into the methodology.
It has to be further noted that the methodology requires, under the “Project Boundary” section, that all CO2 sources
from on-site fossil fuel consumption are included in the project boundary. However, this does not seem to be
necessary with regard to the captive power plant, as it has been already mentioned that the power generated by it
will not be displaced by the project activity, and the waste heat from such captive power plant (from the Wartsila
engine, in particular) will also be neglected in the emission reduction calculation. Thus, it is clear that the captive
power plant is totally extraneous to the project activity and should not be included in the project boundary. This is
indeed appropriate, given that the captive power plant is included in the project boundary of another unrelated CDM
project activity (fossil fuel switch), currently under validation. This has been mentioned here for completeness, but
does not affect the request for deviation presented above.

Another CDM project activity (small scale;
http://cdm.unfccc.int/Projects/Validation/DB/NMY6WWO6STY52U7VNTFU8ZNW4LFD7V/view.html )
that affects the existing fossil fuel based captive power plant is currently under validation. However,
the existing captive power plant is not affected by the WHR project. Therefore, as outlined in the
attached scheme that is part of the PDD, it is deemed reasonable to exclude the existing captive
power plant from the project boundary of the WHR project activity.
The approved methodology AM0024 version 02.1 does not cover any source of waste heat other
than the clinker production process, Nevertheless, the steam generated from Wartsila waste heat
fed into the project activity under validation is going to be measured and the corresponding
generated electricity will not be accounted for the calculation of CERs. This is a conservative
approach which would ultimately result in the project activity being in compliance with the
requirements of the methodology because the CERs will be claimed only for the portion of electricity
which is generated utilizing waste heat from the clinker production process.
Thus, this is only a project specific deviation and does not require an amendment to the approved
methodology AM0024, version 02.1, used by the proposed project activity.

Deviation is requested to admit applicability of the methodology for a specific case that would not be covered
by the methodology if all the physically available waste heat sources are accounted for. Deduction of the
electricity portion due to the Wartsila engine waste heat from the total electricity produced, will not change the
rationale of equation 7. Total emission reduction claimed in the proposed scheme is lower than in the case the
methodology is applied taking into account the entire power generated (out of a total electricity production of
16.5 MW, 1.4 MW are generated using the Wartsila engine waste heat, corresponding to about 5’000 tCO2/y
less than in the case without deviation).