PROJECT IDEA NOTE
A.
Project description, type ,location and schedule
Name of the project: Supercritical power generation in Shanxi Dragon Power Ltd
Technical summary of the project
Date submitted: 200512-31
The objective of the project is to help Shanxi Dragon Power
Ltd adopt the supercritical power generation technique to improve the
energy efficiency, to save coal resource, to use coal more efficiently
and to reduce the green house gas(GHG) emission.
Shanxi Dragon Power Plant LTD has power capacity of 600MW
Project description and proposed
and plans to carry out the second term construction with capacity of
activities(including a technical
2×600MW using supercritical technology, which will increase
description of the project )
investment and affect the financial status such as a decrease in IRR,
however, it will reduce the GHG emission with increasing power
generation. It is estimated that the project activity will reduce coal
consumption of 53 g/kWh, or 381.5x103 t/a coal, being equal to 1017
x 103 t CO2/a emission reduction.
In addition, in the second term construction air cooling technology
will be used instead of water cooling technology, saving a great
amount of water resource and being favorable of sustainable
development, especially for Shanxi province due to the lack of water
resource.
Technology to be employed
Supercritical power generation is a mature technology with
commercial scale. The equipment utilization and the technical
reliability can be competed with sub-critical power generation. The
supercritical power generation turbine with capacity of 600 MW and
the water cooling system made in China has been run in China. The
project activity will use 2 x 600 MW turbine with 2 cylinders and 2
steam exits, and air cooling system with electricity efficiency of 41%.
This technology is the key project in national power industry. The
combined cylinder at high and middle pressure will use the running
one in the 600MW turbine with water cooling system and the low
pressure cylinder will use model design. Considering environment
protection, the combustor with low NOx emission will be used as well
as the deSOx, deNOx and dust removing equipments with high
efficiency.
The major advantages of supercritical power generation are:
1.
Decrease of the fuel cost due to the increasing heat
efficiency;
2.
Decrease of CO2 emission per electricity unit to more
than 15% in comparison with the existed coal fired power
plant.
3.
Decrease of pollutant including SOx, NOx and PM.
The equipments are manufactured by Shanghai Electricity Group
Company (SEC) who develops the high grade power equipment based
on the imported advanced supercritical power generation technology,
having reliability in a high degree.
Objective of the project
Project developer
Name of the project developer
Organizationa category
Shanxi Air CDM Technical Center
e. Non-government
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Other functions of the project
c.Intermediary
Developer in the project
d.Technical advisor
Summary of the relevant
Shanxi Air CDM Technical Center(SACTC) is a non-enterprise
experience of the project developer institution which mainly engaged in the consulting and technical
service of CDM mainly related to coal energy.
Feng Zheng, the director of the SACTC has a long time
diplomatic experience in science and technology, having attended the
countermeasure work with global climate change and got a deep
understanding to CDM, which favors the development of the CDM
project.
Address
50 Tao Yuan North Road,5th floor, Taiyuan,Shanxi 030002 P.R.
China
Contact person
The director of SACTC ; Feng Zheng
Telephone /Fax
TEL;86-351-4052395/FAX：86-351-3332989
E-mail and Website
E-mail：seikou.china@126.com
Project sponsor
The name of the project sponsor
Shanxi Dragon Power Plant Co.LTD
Organization category
State owned enterprise
Address (include web address,if
Bai long town ,Huozhou city, Shanxi province, China
Any)
Main activities
Electric generation
Summary of the financial
Total assets in 2004: 26billion yuan RMB
Total income in 2004: 468million yuan RMB
Total profits and tax in 2004: 122million yuan RMB
Type of the project
Greenhouse gas targeted
CO2
Type of the activities
Emission reduction
Field of the activities
a. Energy supply *
Electric generation in supercritical/energy efficiency
Location of the project
Region
East asian & Pacific
Country
China
City
Huozhou city
Brief description of the location of The project activity is located in the Shanxi Dragon Power Plant at
the project
Bailong town, ,Huozhou city, Shanxi province, China
Expected schedule
Earliest project start date
Plan to be run by the end of 2006
Estimate of time required before
Time for financing:4 month
becoming operational after
Time for law procedure;6 month
approval of the PIN
The time for commercial negotiation; 5month
The time for building:12month
Expected first year of CER
2007
delivery
Project lifetime
20 years
Current status or phrase of the
The feasible study and design has been completed and it is ready to
Project
purchase the equipment. The construction has been started.
The preliminary screening of the project and the edit of the PIN and
PDD documents are going on.
Current status of the acceptance of Applying to the approval documents of the Host Country
the Host Country
signed or acceded to the Kyoto Protocol
The position of the Host Country a.
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With regard to the Kyoto
protocol
B. Expected environmental and social benefits
Estimate of Greenhouse Gases
Abated /CO2sequestered(in
metric tons of CO2-equivalent
Baseline scenario
Annual :up to 2012(including 2012): 1.017million tCO2
Up to a period of 10 years: 10.173million tCO2
Up to a period of 7 years: 7.119 million tCO2
Up to a period of 14years: 14.238million tCO2
which gas emission will be replaced by the proposed CDM project
and JI?
The proposed CDM project will use supercritical power generation
technology instead of sub-critical one, which will greatly reduce
the coal consumption and decrease the CO2 emission due to the high
efficiency of energy utilization.
What would be in the future if without the CDM project?
If without the project, the sub-critical power generation technology
would be used and a huge additional amount of coal would be
consumed, leading to a lower energy utilization efficiency with higher
CO2 emission, which is used as the baseline scenario.
Expected emission reduction?
According to the data from the Shanxi electricity Network, the energy
consumption is about 380 g standard coal/kWh, while after adopting
supercritical power generation technology, it reduces to 297 g. Based
on the conservative calculation using the advanced value of 350 g
coal/kWh for the energy consumption, the project activity with
capacity of 120MW power generation will save 381,500 tons coal per
year or reduce 1,017,000 t CO2-eq/a emission.
Because there is no approved methodology for the .project, it is
necessary to develop a new methodology.
Only to the Carbon absorbing ;
forest and land
Specific global& local
envirommental benefits
Which guidelines will be applied?
Local benefits
Global benefits
Socio-ecomomic aspects
What social and economic effects
The target of CDM project is consist with the development
strategy and policy in China and the project activity is suggested in
ten and eleven 5 year plan by national and provincial government.
The project activity will reduce not only 1,017,000tCO2-eq/a of
GHG emission but also a considerable amount of pollutants including
SOx, NOx and PM, which will greatly improves the local
environment.
The performance of the project proposed can reduce GHG
emission with lower cost because its low cost in Shanxi, being
beneficial of the action to mitigate the global warming. During the
performance, enterprise will accelerate its pace to be merged in the
world.
The project will save a lot of energy, being about more than 381.5
x103t/a coal or the total saving of 7.63 x106 t coals if its lifetime is 20
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can be attributed to the project and years, or about 2.9 x 109 Yuan RMB based on the coal price of 380
which would not have occurred in yuan RMB/t coal.
a comparable situation without that
The project will also save the cost and liquid fuel in the
project?
transportation. It is estimated that 38 thousand vehicles are needed
according to 10 t/vehicle.
The project can provide 60 job opportunities which will greatly
promote the local development.
Thus, The project will bring the benefits as follows: to increase the
income of the enterprise, strengthen its ability of sustainable
development, reduce environment pollution ,create employment and
promote the use of advanced technologies.
Which guidelines will be applied?
The major relevant environmental protection laws, regulation,
standards as follows were applied:
1．Design Regulation of environmental protection of construction
project (The State Environment Protection Bureau, Document 002,
1987)
2．Management Regulation of environmental protection of
construction project (The State Council, Document 253, 1998)
3．Prevention and control regulation of air pollution (April 29, 2000)
4．Prevention and control regulation of water pollution (May
15,1996)
5．Standars for comprehensive air pollutant discharge (GB
16297-1996)
6．The standard for the noise in industrial enterprises （GB12348-90）
What are the possible direct
effects(e.g.,employment
creation,capital required ,foreign
exchange effects)
What are the possible other
effects?
Environmental
strategy/priotities of the Host
Country
The project is expected to provide about 60 job opportunities.
Reduction of the financial risk in performing COG technology for the
Jinyang Group Company during carrying out the project makes the
performance of the project to be determined by the policy-making
body of Jinyang Group.
The other benefits from the project
1. Saving of the liquid fuels for coal transportation due to the saving
of coal about 381,500 t/a.
2. It is beneficial of the improvement of enterprise management and
the severe training of the staff due to the scientific controlling and
monitoring works in performing the CDM project.
3. The use of the air cooling technology instead of water cooling
technology will save a great amount of water resource and being
favorable of sustainable development, especially for Shanxi province
due to the lack of water resource.
To pay more attention to environmental protection in a high
growth rate of economic development is one of the environmental
strategy. The key field for the CDM is in energy efficiency, the new
energy and renewable energy resources, the recycle and use of CH4
including coke oven gas and landfill gas.
C. Finance
Total project cost estimate
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development costs
installed costs
other costs
total project costs
Sources of finance to be sought
or already identified
Equity
Debt-long term
Debt--short term
not identified
CDM contribution sought
CDM contribution in advance
payments.
Sources of carbon finance
Million US$
Million US$
Million US$
62.2Million US$
Raise by the enterprise itself:, taking up 20% of the total and loan
13.42million US$
48.78million US$ from Development Bank ,Mingsheng Bank,and
Guanda bank
xx million US$
xx million US$
Xx million US$
Xx million US$，and brief clarification
Name of carbon financiers other than PCF that your are contacting(if
any)
8US$/CO2t
Indicative CER Price（subject to
negotiation and financial due
diligence）
Total Emission Reduction
Purchase Agreement（ERPA）
32,544,000US$
A period until 2012（end of the first
budget period）
A period of 10 years
81,360,000US$
A period of 7 years
56,952,000US$
113,904,000US$
A period of 14 years（2*7）
If finacial analysis is available for The financial analysis for the proposed CDM project is going on.
the proposed CDM
activity ,provide the forecast
financial internal tate of return for
the project with and without the
CER revenues .Provide the
financial rate of return at the
expected CER price above and
US$3/tCO2e. DO NOT assume
any upfront payment from the PCF
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