CDM project activity/programme of activities registration request review form (CDM-REGR-FORM) (Version 03.0)

Reference number of the proposed CDM project activity/programme of activities (PoA) submitted for registration	5797
Title of the proposed CDM project activity/PoA submitted for registration	Ayer Hitam landfill gas recovery project
Please indicate, in accordance with paragraphs 37 and 40 of the CDM modalities and procedures, which validation requirement(s) may require review. A list of requirements is provided below. Please provide reasons in support of the request for review. Including any supporting documentation.
The following are requirements derived from paragraph 37 of the CDM modalities and procedures:
The participation requirements as set out in paragraph 28 to 30 of the CDM modalities and procedures are satisfied; Comments by local stakeholders have been invited, a summary of the comments received has been provided, and a report to the designated operational entity (DOE) on how due account was taken of any comments has been received; Project Participants have submitted to the DOE documentation on the analysis of the environmental impacts of the project activity, including transboundary impacts and, if those impacts are considered significant by the project participants or the host Party, have undertaken an environmental impact assessment in accordance with procedures as required by the host Party; The project activity is expected to result in a reduction in anthropogenic emissions by sources of greenhouse gases that are additional to any that would occur in the absence of the proposed project activity, in accordance with paragraphs 43 to 52 of the CDM modalities and procedures; The baseline and monitoring methodologies comply with requirements pertaining to methodologies previously approved by the Executive Board; Provisions for monitoring, verification and reporting are in accordance with decision 17/CP.7, the CDM modalities and procedures and relevant decisions of the COP/MOP; The project activity conforms to all other requirements for CDM project activities in decision 17/CP.7, the CDM modalities and procedures and relevant decisions by the COP/MOP and the Executive Board.
The following are requirements derived from paragraph 40 of the CDM modalities and procedures:
The DOE shall, prior to the submission of the validation report to the Executive Board, have received from the project participants written approval of voluntary participation from the designated national authority of each Party involved, including confirmation by the host Party that the project activity assists it in achieving sustainable development; In accordance with provisions on confidentiality contained in paragraph 27(h) of the CDM modalities and procedures, the DOE shall make publicly available the project design document; The DOE shall receive, within 30 days, comments on the validation requirements from Parties, stakeholders and UNFCCC accredited non-governmental organizations and make them publicly available; After the deadline for receipt of comments, the DOE shall make a determination as to whether, on the basis of the information provided and taking into account the comments received, the project activity should be validated; The DOE shall inform project participants of its determination on the validation of the project activity. Notification to the project participants will include confirmation of validation and the date of submission of the validation report to the Executive Board; The DOE shall submit to the Executive Board, if it determines the proposed project activity to be valid, a request for registration in the form of a validation report including of the project design document, the written approval of the host Party and an explanation of how it has taken due account of comments received.
There are only minor issues which should be addressed by the DOE/project participants prior to the registration of the project.
Additional information
1) The DOE is requested to clarify how it has validated the suitability of the project start date as 16/3/2009; while doing so, the DOE may refer to the issues raised on the additionality of the project activity, in particular, the validation of the project as a stop and recommence project. Please refer to VVM version 01.2 paragraph 104 (a). 2) The power plant first began operations on 9/4/2004, the current PP (WLSB) acquired 30% ownership to start the project on 17/8/2005 and the CDM was considered on 10/10/2005 i.e. after 17/8/2005. Further clarification is sought on how the DOE has validated the prior consideration of the CDM.  Please refer to VVM, 1.2, para 98. 3) The proposed project activity collects and uses landfill gas (LFG) to generate electricity in a power plant that started operations in April 2004 and in which the current PP (WLSB) had acquired a 30% share  in Aug. 2005. The PP had earlier decided to undertake the same LFG-based power plant as a CDM project in  Oct. 2005 and  the PDD was submitted for  validation for the 1st, 2nd, and 3rd time in Jan. 2007, April 2007 and May 2008, respectively, even as the project stopped operations - partly in Oct 2006 (one engine) and fully in 2007. The PP has acquired 80% ownership of the power plant on 18/7/2008 and has resubmitted the project as a “recommenced”project with project start date in March 2009. (a) The DOE is requested to explain how it has considered that the project activity is a restart project given that it was already submitted as a CDM project and that the PP has continued to operate it, despite previous breakdowns. If it is to be considered as a new or “recommenced project”, the DOE shall explain how it has considered that the PP needed the CDM to proceed with the project activity given that it has made further investment to acquire 80% ownership of the power plant.  b) The DOE has considered the project activity as a stop and recommence project and hence validated the value of the recoverable assets as investment costs for the project activity. It is not clear how the value has been estimated. (i) The DOE is requested to clarify the percentage of costs that was considered recoverable from the original investments and provide a breakdown of the estimated recoverable and unrecoverable assets. (ii)Further the DOE should clarify on what basis the recoverable value was evaluated i.e. whether the value was estimated on the basis that the landfill gas collection system and power plant would be completely abandoned and that the old assets (purchased prior to 13/6/2009) would be sold as scrap or the value was estimated based on what a potential buyer would pay to restart the LFG collection and power plant system. Please refer to VVM 1.2, para 111 (a), (b), (d).. 4) The investment analysis spreadsheet has many assumptions to arrive at a net electricity generation; the assumptions include the recovery rate of the LFG, plant load factor, different electrical installed capacities that change in different years. No validation opinion has been provided  on the different assumptions. The DOE should further validate the electricity generation used in the investment analysis. In particular it should further validate: (a) why the minimum between the installed capacity and electrical capacity has been used in the calculation of the electricity generated; (b) how the electrical capacity has been calculated: (i) why a recovery rate of 60% for the LFG generated has been used; (ii) how the ratio capacity/flow has been validated, including the suitability of using values from 1.49 to 1.62 for different years as per the spreadsheet submitted and; (c) why from year 2019 onwards the installed capacity only considers one 1,048MW engine. Please refer to VVM 1.2, para 111. 5) The baseline LFG2 has been selected and the DOE has validated that as there was no LFG recovery between 2005-07, it can been accepted that there was total release of LFG in the baseline. The DOE has validated that the adjustment factor of zero is appropriate. However, the applied methodology provides an equation to estimate the destruction efficiency of the system where historical data exists. Considering the LFG was captured for electricity generation from 2004-07 i.e. historical data exists for baseline estimation, further clarification is sought on how the DOE has validated the estimation of the baseline emissions, in particular, how it considers use of AF as zero conservative. Please refer to VVM version 01.2 paragraph 84,90. 6) The DOE should further explain how it has validated that the formula used to calculate the ex-ante baseline emissions. In particular the DOE should describe how the use of a collection efficiency of 60% and a calculated ratio of 92.5% is in line with the formula described in the methodology for the estimation of the the amount of methane that would have been destroyed/combusted during the year.     Please refer to ACM0001 version 11, formula 13.
Date	29 Apr 12