Installation of wind power project in Rajasthan and Tamil Nadu
Host party(ies) India
Methodology(ies) ACM0002 ver. 12
Standardised Baselines N/A
Estimated annual reductions* 96,152
Start date of first crediting period. 01 May 11
Length of first crediting period. 10 years
DOE/AE Lloyd’s Register Quality Assurance Ltd.
Period for comments 05 Jan 11 - 03 Feb 11
PP(s) for which DOE have a contractual obligation IL&FS Energy Development Company Ltd.
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 (417 KB)
Local stakeholder consultation report: N/A
Impact assessment summary: N/A
Submission of comments to the DOE/AE Compilation of submitted inputs:
The PP states that they have considered 80% accelerated depreciation. However the PDD is silent on the tax shielding as a result from accelerated depreciation.
PPs cleverly do not consider the accounting tax offsetting in their companies while calculating the IRR. This is evident from the recently registered projects and those requesting registration.  
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.
Note that considering cash inflows results in an increase in the IRR making wind projects a profitable venture.
Submitted by: Babloo

Comment (16 KB) Submitted by: Fernandis

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