FVR - 5MW Tamil Nadu

VALIDATION REPORT
for the CDM Project Activity 5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu in India Report No. 01 997 9105057438
Version No. 04, 02/05/2011
TV Rheinland Japan Ltd.
Validation Report
01 997 9105057438
I. Project description:
Project title: Host Country: Methodology: Annual average emission reductions (estimate): 5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu India AMS-I.D. version 16 Scale 7862 tCO2e/yr Large Scale Small
GHG reducing measure/technology: The GHG emission reduction would happen by displacing the fossil fuel dominated grid electricity equivalent to the net renewable electricity supplied by the SPV power plant. Party considered a project participant No
Party India(Host)
Project Participants M/s Sapphire Industrial Private Limited (SIIPL) Infrastructures
II. Validation:
Contract party: M/s Sapphire Industrial Infrastructures Private Limited Validation Team: Role Team Leader Team Member Trainee Technical Reviewer Full name Mr. Asim Kumar Jana Mr. Raj Kumar Deka Mr. Dinesh Mane Mr. Sanjay Kumar Agarwalla Mr. Vikash Kumar Singh Mr. Praveen Nagaraje Urs Appointed for Sectoral Scopes 1,2,3,4,5,11,12,13 1,2,3 N/A N/A N/A 1, 13 Affiliation TV Rheinland India Ltd. TV Rheinland India Ltd. TV Rheinland India Ltd TV Rheinland India Ltd TV Rheinland India Ltd TV Rheinland India Ltd.
Validation Phases: Desk Review Follow up interviews Resolution of outstanding issues
Validation Status: Corrective Actions / Clarifications Requested Full Approval and Submission for Registration Rejected
III. Validation Report:

Report No.: Current revision No.: Date of current revision: Date of first issue:
01 997 9105057438
Distribution:
04
02/05/2011
03/02/2011
No distribution without permission from the Client or responsible organizational unit

Final approval: Released on:
Unrestricted distribution
Designated Operational Entity (DOE):
TV Rheinland Japan Ltd.

Date: 2011-05-12 By: Dr. Manfred Brinkmann Shin Yokohama Daini Center Bldg., 3-19-5, Shin Yokohama Kohoku-ku, Yokohama, JAPAN 222-0033 Tel.: +81 45 470 1850, Fax: +81 45 470-2361 E-mail: cdm@tuv.com Page 2
Version No.:04
Validation Report
01 997 9105057438
Executive Summary Validation Opinion

The validation team assigned by the DOE (TV Rheinland Japan Ltd.) concludes that the CDM Project Activity 5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu in India, as described in the PDD (version-01.5, dated 22/03/2011), meets all relevant requirements of the UNFCCC for CDM project activities including Article 12 of the Kyoto Protocol; the modalities and procedures for CDM (Marrakesh Accords); the subsequent decisions by the COP/MOP and CDM Executive Board; and host country criteria. The selected baseline/monitoring methodologies are applicable to the project and correctly applied. The DOE therefore requests the registration of the project as a CDM project activity. The validation was executed in the following steps so far: Receipt of PDD (version 01, 05/03/2010) for global stakeholder commenting Global stakeholder comment process (19/03/ 2010 17/04/2010) On-site visit with stakeholder interviews (29/03/2010 30/03/2010 and on 20/08/2010) Issue of checklist with corrective action requests (CARs) and clarification requests (CLs) and the draft validation report and protocol Desk review of revised PDD applying AMS.I.D Version 16 Review of proposed corrections and clarifications Issue of the final validation report and protocol
The project participant is M/s Sapphire Industrial Infrastructures Private Limited from the host Party India. No Annex I Party has yet been involved. India fulfils the relevant participation criteria for the CDM. Approval of voluntary participation from the Designated National Authority (DNA) of India and confirmation that the project assists in achieving sustainable development has been obtained through its letter of approval dated 01/02/2010 /P03/. This validation did not reveal any information that indicates that the project can be seen as a diversion of ODA funding towards India. The validation team has checked that the project correctly applies AMS I.D (Version 16) - Grid connected renewable electricity generation. By generating renewable electricity which will displace fossil fuel based grid electricity, the project results in the reductions of CO2 emissions that are real, measurable and give long term benefits to the mitigation of climate change. It is demonstrated that the project is not a likely baseline scenario. Emission reductions attributable to the project are hence additional to any that would have occurred in the absence of the project activity. The project is likely to result in an average emission reduction of 7862 t CO2e per annum over the selected first renewable crediting period of seven years. The emission reduction forecast has been checked and is deemed likely that the stated amount is achieved given that the underlying assumptions do not change. The monitoring methodology has been correctly applied. The monitoring plan makes sufficient provision for monitoring relevant project and baseline emission indicators. Detailed responsibilities and authorities for project management, monitoring and reporting and QA/QC procedures have also been addressed. In the course of the validation twenty eight (28) Corrective Action Requests (CARs) and seventeen (17) Clarification Requests (CLs) were raised and successfully closed. No Forward Action Requests (FAR) was raised during this validation
Version No.:04 Page 3
Validation Report
01 997 9105057438
In summary, the validation team considers that the underlying reason of the early CDM consideration, the investment barrier and barrier due to prevailing practice is sufficiently evidenced. Thus it is the validation teams opinion that the 5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu, as described in the PDD version 01.5 dated 22/03/2011 meets all the relevant UNFCCC requirements for the CDM project and relevant host country criteria and correctly applies the baseline and monitoring methodology AMS I.D., Version 16. The validation team of TUV Rheinland Japan Ltd. thus recommends the proposed project to be registered as a CDM project activity with the UNFCCC.
Version No.:04
Page 4
Validation Report
01 997 9105057438
Abbreviations
AM BAU BE BM CA CAR CDM CEA CERs CERC CL CM CO2 CO2e COD CP DACRE DNA DPR DOE EB EIA ER EPA EPC ERM FAR FSR GBI GOI GHG GSC IDBI IDC IFC IFY INR IRR kWh LoA L MBCL MNRE MoEF MOP MoV MoM MP MW
Version No.:04
Air Mass Business as usual Baseline Emissions Build Margin Corrective Action / Clarification Action Corrective Action Request Clean Development Mechanism Central Electricity Authority Certified Emission Reductions Central Electrcity Regulataory Comission Clarification Request Combined Margin Carbon dioxide Carbon dioxide equivalent Commercial Operation Date Certification Program District Advisory Committee on Renewable Energy Designated National Authority Detailed Project Report Designated Operational Entity CDM Executive Board Environmental Impact Assessment Emission Reductions Energy Purchase Agreement Engineering Procurement Construction Environment Resource Management Forward Action Request Feasibility Study Report Generation Based Incentative Government of India Greenhouse Gas(es) Global Stakeholders Comments Industrial Development Bank of India Interst During Construction International Finance Corporation Indian Finanacial Year Indian Rupees Internal Rate of Return Kilowatt hour Letter of Approval Leakage Moser Baer Clean Energy Limited Ministry of New and Renewable Energy Ministry of Environment & Forest Ministry of Power Means of Verification Minutes of Meeting Monitoring Plan Megawatt
Page 5
Validation Report
01 997 9105057438
MWh MWp N/A ODA OM O&M PDD PP PLF PLR PV QC/QA RBI SEIA SLD SPV STC SIIPL RfR SD SSC SSC PA TNEB UNEP UNFCCC VVM WDV
Megawatt hour Megawatt hour peak Not Applicable Official Development Assistance Operating Margin Operation and Maintenance Project Design Document Project Participant Plant Load Factor Prime Lending Rate Photo Volatic Quality control/Quality assurance Reserve Bank of India Social and Environment Impact Assessment Single Line Diagram Solar Photo Volatic Standard Test Conditions Sapphire Industrial Infrastructures Private Limited Request for Registration Sustainable Development Small-Scale Small Scale Project Activity Tamilnadu Electricity Board United Nations Environment Programme United Nations Framework Convention on Climate Change Validation Verification Manual Written Down Value
Version No.:04
Page 6
Validation Report
01 997 9105057438
TABLE OF CONTENTS
1 1.1 1.2 2 2.1 2.2 2.3 2.4 2.5 3 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 3.9 3.10 INTRODUCTION........................................................................................................ 8 Objective Scope Desk Review of the Project Design Documentation Follow-up Interviews with Project Stakeholders Resolution of Outstanding Issues Internal Quality Control Validation Team Approval and participation Project Design Document Project Description Baseline and Monitoring Methodology Additionality Monitoring Sustainable Development Environmental Impacts Local Stakeholder Consultation Comments by Parties, Stakeholders and NGOs 8 8 9 12 13 14 15 15 17 17 19 29 42 44 44 44 45
METHODOLOGY ....................................................................................................... 9
VALIDATION FINDINGS.......................................................................................... 15
Appendix A: Validation Protocol Appendix B: Certificates of Competence
Version No.:04
Page 7
Validation Report
01 997 9105057438
1 INTRODUCTION
The M/s Sapphire Industrial Infrastructures Private Limited has commissioned the DOE TV Rheinland Japan Ltd. to perform a validation of the CDM Project Activity 5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu in India (hereafter called the project activity). This report summarises the findings of the validation of the project, performed on the basis of UNFCCC criteria for the CDM, as well as criteria given to provide for consistent project operations, monitoring and reporting. The term UNFCCC criteria refers to Article 12 of the Kyoto Protocol, the CDM modalities and procedures and the simplified modalities and procedures for small scale CDM project and the subsequent decisions by the COP/MOP and CDM Executive Board. In addition to these criteria, host country criteria are also taken into account.
1.1 Objective
The purpose of a validation is to have an independent third party assess the project design. In particular, the project's baseline, monitoring plan, and the projects compliance with relevant UNFCCC and host Party criteria are validated in order to confirm that the project design, as documented, is sound and reasonable and meets the identified criteria. Validation is a requirement for all CDM projects and is seen as necessary to provide assurance to stakeholders of the quality of the project and its intended generation of certified emission reductions (CERs).
1.2 Scope
The validation scope is defined as an independent and objective review of the project design document (PDD). The PDD is reviewed against the relevant criteria (see above) and decisions by the CDM Executive Board, including the approved baseline and monitoring methodology. The validation team has, based on the recommendations in the Validation and Verification Manual (VVM) employed a rules-based approach, focusing on the identification of significant risks for project implementation and the generation of CERs. The validation is not meant to provide any consulting towards the project participants. However, stated requests for clarifications and/or corrective actions may have provided input for improvement of the project design.
Version No.:04
Page 8
Validation Report
01 997 9105057438
2 METHODOLOGY
The validation consists of the following three phases: I II III a desk review of the project design documents on-site visit and follow-up interviews with project stakeholders the resolution of outstanding issues and the issuance of the final validation report and opinion.
The following sections outline each step in more detail.
2.1 Desk Review of the Project Design Documentation

The following table outlines the documentation reviewed during the validation: Documents provided by the project participant(s): /P01/ /P02/ /P03/ /P04/ /P05/ /P06/ /P07/ /P08/ /P09/ /P10/ /P11/ /P12/ /P13/ PDD [webhosted version], Version - 01, Date-05/03/2010 PDD [final version], Version 01.5, Date- 22/03/2011 Letter of Approval from the Host Country from DNA India dated 01/02/2010 (No. 4/22/2009-CCC). Modalities of Communication: dated 02/05/2011. Spread sheets for emission reduction calculations and Grid Emission Factor corresponds to /P01/. Spread sheets for emission reduction calculations and Grid Emission Factor corresponds to /P02/. Spread sheets for Investment analysis and sensitivity analysis corresponds to /P01/ Spread sheets for Investment analysis and sensitivity analysis corresponds to /P02/ Copy of the abstract of Board of Directors meeting of SIIPL dated 12/08/2008 in which decision for the project has been taken. Proof of communications with CDM EB and the host DNA, as in present case starting date is after 2nd August 2008 in accordance with EB 49, annex 22. Grant from International Finance Corporation- Ref: copy of letter from IFC dated 14/04/2009. Copy of Service and Supply Agreement dated 29/01/2010 between the PP(SIIPL) and M/s Moser Baer Engineering & Construction Ltd.(consultant/supplier) - Proof of starting date of the project activity Copy of the Detailed Project Report prepared by ITCOT Consultancy and Services Limited, July 2008 Relevant proofs of local stakeholder consultation process, in particular the following: 1. Copy of media used (copy of news paper advertisement in local and national news paper) dated 17/06/2009 2. Copy of Minutes of Meeting of the local stakeholders consultation meeting dated 26/06/2009 3. Copy of Attendance sheet of the meeting of the local stakeholders consultation dated 26/06/2009
Page 9
/P14/
Version No.:04
Validation Report
01 997 9105057438
4. Photographs of the Local stakeholders consultation meeting dated 26/06/2009 /P15/ Operational and management structure for implementation and monitoring (monitoring manual) of project activity (Organisation chart concerns to CDM Monitoring) Statutory clearances required for the implementation of the project activity. 1. Copy of approval from the local Gram Panchayat dated 11/03/2009. 2. Copy of No objection certificate from the District Advisory Committee on renewable energy dated 18/06/2009, letter reference no. A5/3325/2009 3. Copy of Certificate for land use from the Director, town and urban planning dated 08/06/2009 letter reference no. 773/2009/SR3 4. Copy of Consent to establish under water prevention and control act from Tamilnadu Pollution Control Board dated 19/08/2009, consent order no 5048. 5. Copy of Consent to establish under Air (prevention and control of pollution) act from Tamilnadu Pollution Control Board dated 19/08/2009, consent order no 4989. Plant Lay-out drawing as per the service agreement Copy of revised Energy Purchase Agreement dated 09/11/2009 between TNEB and SIIPL Copy of energy Purchase Agreement (Old) dated 20/08/2009 between TNEB and SIIPL Undertaking letter from IFC dated 23/09/2010, that no CERs would be claimed by IFC in lieu of the grant provided. SLD (Single Line Diagram) of the Electricity System showing from the Electricity generator (SPV array) point to the injection point (final metering point) to the grid. Undertaking letters provided by PP to demonstrate no ODA used for the project activity. 1. Undertaking(no ODA used) letter from SIIPL dated 03/04/2010, ref noSIIPL/TN/03042010-2 2. Undertaking letter from SIIPL dated 31/05/2010, that no CERs would be claimed by IFC in lieu of the grant provided. Certificate of Incorporation of SIIPL issued by Assistant Registrar of Companies, National Capital Territory of Delhi and Haryana dated 10/06/2008. Certified output and efficiency of the SPV from an accredited agency. Copy of Annual audited ( by accredited 3rd party financial auditors) balance sheet of the SIIPL for the IFY 2009-10 Declaration from the PP that the project activity, remain under the limit of small scale project activity and the technology would not change during the entire crediting period ref: Undertaking letter from SIIPL dated 03/04/2010. Copy of bank statement evidencing IDC paid by SIIPL until 31/12/2010. Copy of Loan Application to IDBI Letter dated 08/10/2009, letter reference no. SIIPL/Solar/TN Project/2008-09. Copy of Loan Sanction letter from IDBI dated 12/02/2010, letter reference no. IDBI/KBO/ICG/SIIPL/-10067. Copy of Land sale deed between M/s Century Agrotech Limited and SIIPL dated 24/11/2009. Copy of SEIA report prepared by ERM India Pvt. Ltd dated 20/11/2009.
Page 10
/P16/
/P17/ /P18/ /P19/ /P20/ /P21/
/P22/
/P23/ /P24/ /P25/ /P26/ /P27/ /P28/ /P29/ /P30/ /P31/
Version No.:04
Validation Report
01 997 9105057438
/P32/ /P33/
MNRE letter dated 30/10/2009 ref no 32/61/2007-08/ PVSE regarding approval of the project for GBI. Commissioning certificate of the plant dated 20/12/2010 Declaration letter provided by the supplier (EPC contractor with whom supply and service agreement signed / P12/) on the number and capacity of SPV modules and inverters installed at the plant site and the output capacity of the SPV power plant dated 16/03/2011, letter ref no. MBECL/CERT-SVG/2010-11/0316
/P34/
Background investigation and other referred documents/websites: /B01/ /B02/ /B03/ CDM Validation and Verification Manual (Version 01.2) Approved Baseline & Monitoring Methodology: AMS-I.D., version 16 Tool to calculate the emission factor for an electricity system, version 02 1. Guidance on the Assessment of Investment Analysis, EB 51, annex 58, (Version 02) 2. Attachment A to appendix B of simplified modalities & procedures. 3. Non-binding best practices for barrier analysis (Annex 34 of EB 35) UNFCCC: Guidelines for Completing the Project Design Document (CDM-SSC-PDD) and the template for the CDM-SSC-PDD. 1. General Guidelines to SSC CDM methodologies, Version 16 2. CDM Glossary of terms 3. Relevant CDM requirements (CDM M & P and decisions by the CMP and documents released by CDM EB) published on the UNFCCC CDM website Carbon dioxide database version-05 published by Central Electricity Authority. http://www.cea.nic.in/planning/c%20and%20e/Government%20of%20India%20website .htm http://envfor.nic.in/divisions/ccd/cdm_iac.html, Ministry of Environment and Forests (MoEF) interim approval guidelines for CDM projects http://rbidocs.rbi.org.in/rdocs/Wss/PDFs/86374.pdf - Prime Lending Rate (PLR) published by RBI www.fastfacts.co.in/resources/DepCoAct.rtf -Companys law 1956 for SLM depreciation on Civil works and on Plant & machinery. 1. Tamil Nadu Electricity Regulatory Commission, Order No 6 dated 11/07/2008, http://tnerc.tn.nic.in/orders/Order%20No%206-11.07.08.pdf 2. Tamil Nadu Electricity Regulatory Commission ,Amending Order No. 6 1 dated
/B04/
/B05/
/B06/ /B07/ /B08/ /B09/
/B10/
22/09/2009 http://tnerc.tn.nic.in/regulation/Tariff/2009/Amendment%20to%20order%20N o.%206%20of%202008.pdf

http://mnre.gov.in/ - For the demonstration of barrier due to prevailing practice http://envfor.nic.in/legis/eia/so1533.pdf - EIA notification from MoEF dated 14/09/2006. http://moef.nic.in/downloads/rules-and-regulations/3067.pdf - Amendment of EIA notification dated 01/12/ 2009 Extract of IT act (2008-09) to support Corporate Tax, MAT, IT depreciation and IT depreciation on civil works. http://www.mnre.gov.in/pdf/guidelines_spg.pdf - Guidelines for generation based incentive for grid interactive solar power generation projects, Government of India
Page 11
/B11/ /B12/ /B13/ /B14/
Version No.:04
Validation Report
01 997 9105057438
Ministry of New and Renewable Energy /B15/ /B16/ /B17/ /B18/ /B19/ http://www.cea.nic.in/e&c/regulations/notified_regulations/Metering_Regulations.pdf Extract of CERC 2006 for testing of Monitoring requirement. Host DNA approved project list: http://cdmindia.in/reports_list_details.php?id=21&reporttype=1 1. http://www.cercind.gov.in/Regulations/Final_SOR_RE_Tariff_Regulations_to_uploa d_7_oct_09.pdf - CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2009 2. http://mnre.gov.in/press-releases/press-release-13072009-2.pdf Solar Radiation Hand Book (2008)- http://www.indiaenvironmentportal.org.in/files/srdsec.pdf PV Syst. (version 4.35) simulation result to derive net electricity generation from the project.
2.2 Follow-up Interviews with Project Stakeholders

In order to reach to a Validation Opinion an interview was planned for 29/03/2010 to 30/03/2010 and on 20/08/2010. Prior to the interview salient points to be discussed were planned. Date of interview, interviewee and points discussed are given in the following table. Sr. No /I-01/ Date 29/03/2010 to 30/03/2010 /I-02/ 29/03/2010 to 30/03/2010 Name Mr. Narang Organization Dinesh Vice President, M/s Sapphire Industrial Infrastructures Private Limited Topic Project Design, Project Implementation schedule, Seriousness of CDM consideration, Additionality, Stakeholder Consultation, Project Design, Project Implementation schedule, Seriousness of CDM consideration, Stakeholder consultation process. Capacity of modules and power plant, evacuation system, Module degradation, PLF. Baseline and Additionality Baseline and Additionality
/I-03/
05/05/2010
/I-03/ /I-04/ /I-05/
29/03/2010 to 30/03/2010 29/03/2010 to 30/03/2010 20/08/2010
Sneha Senior Manager, M/s Sapphire Industrial Infrastructures Private Limited Mr. Jayesh M/s Sapphire Jakhete Industrial Infrastructures Private Limited Mr. Bhaskar Senior Consultant, Jyoti Nath Emergent Ventures India Mr. Chilamburaj Consultant, A Emergent Ventures India Mr. S. Sridhar General Manager, Technical services, Moser Baer
Ms. Daheria
/I-06/
20/08/2010
Mr. D. Kumarasen
Project Implementation schedule, Project design, Capacity of modules and power plant, evacuation system, Module degradation, PLF. P. Vice President, Stakeholder consultation Century Consulting process. Group
Version No.:04
Page 12
Validation Report
01 997 9105057438
Validation Team considered the views obtained in these interviews while arriving at Validation Opinion.
2.3 Resolution of Outstanding Issues

The objective of this phase of the validation is to resolve any outstanding issues which need be clarified prior to TV Rheinlands positive conclusion on the project design. In order to ensure transparency a validation protocol is customised for the project. The protocol shows in transparent manner criteria (requirements), means of verification and the results from validating the identified criteria. The validation protocol serves the following purposes: It organises, details and clarifies the requirements a CDM project is expected to meet; It ensures a transparent validation process where the validator will document how a particular requirement has been validated and the result of the validation.
The validation protocol consists of three tables. The different columns in these tables are described in the figure (Figure 1) given below. The completed validation protocol for this project is enclosed as Appendix A to this report. Findings established during the validation can either be seen as a non-fulfilment of CDM criteria or where a risk to the fulfilment of project objectives is identified. Corrective action requests (CAR) are issued, where: i) mistakes have been made with a direct influence on project results; ii) CDM and/or methodology specific requirements have not been met; or iii) there is a risk that the project would not be accepted as a CDM project or that emission reductions will not be certified. A request for clarification (CL) may be used where additional information is needed to fully clarify an issue. A forward action request (FAR) may be raised to highlight issues related to project implementation that require review during the first verification of the project activity.
Version No.:04
Page 13
Validation Report
01 997 9105057438
Draft and/or Final Conclusion
Validation Protocol Table 1: Validation Requirements Checklist Question Reference Means of Findings, verification comments, (MoV) references, data sources Explains how The section is The various Gives used to conformance requirements in Table 1 reference with the elaborate and are linked to checklist to discuss the questions (incl. documents checklist is checklist where the question mandatory question requirements for CDM answer to investigated. the Examples of and/or project activities) the the means of conformance project should meet. checklist the The checklist is question or verification are to question. It is is document organised in different item review (DR) or further used to sections, following the found. the interview (I). explain logic of the CDM VVM N/A means not conclusions manual Ver 1. Each reached. applicable. section is then further sub-divided with numeric numbering system.
This is either acceptable based on evidence provided (OK), or a corrective action request (CAR) due to non-compliance with the checklist question (See below). A request for clarification (CL) is used when the validation team has identified a need for further clarification. A forward action request (FAR) is raised during validation to highlight issues related to project implementation that require review during the first verification of the project activity.
Validation Protocol Table 2: Resolution of Corrective Action and Clarification Requests CL/CA Observations Reference Summary of Revised Validation team R No project owner section(s)/ conclusion response Annexe(s) of the PDD This section should CL/CA If the Reference to The responses given summarise the validation the project the checklist by R- XX conclusions teams responses and participants during from the draft question final conclusions. The in the communications Validation are number conclusions should also 1 with the validation either a CAR or Table be included in Table 1, should be the team a CL, these where under Final should be listed CAR or CL is summarised in this Conclusion. section. explained. in this section.
Validation Protocol Table 3: List of forward action requests (FARs) Observations Reference Summary of project Validation team conclusion FAR owner response Numbe r FARIf the Reference The responses given This section should summarise the the project validation teams responses and final to the by XX conclusions participants during the conclusions. The conclusions should from the draft checklist communications with also be included in Table 1, under Final Validation are question FARs, these number in the validation team Conclusion. 1 should be summarised should be Table listed in this where the in this section. FAR is section. explained.
Figure 1. Validation protocol tables
2.4 Internal Quality Control

The draft validation report including the initial validation findings underwent a technical review before being submitted to the project participants.
Validation Report
01 997 9105057438
The final validation report underwent another technical review before requesting registration of the project activity. The technical review was performed by a technical reviewer qualified in accordance with TV Rheinlands qualification scheme for CDM validation and verification.
2.5 Validation Team

Role Team Leader Team Member Trainee Technical Reviewer Full name Mr. Asim Kumar Jana Mr. Raj Kumar Deka Mr. Dinesh Mane Mr. Sanjay kumar Agarwalla Mr. Vikash Kumar Singh Mr. Praveen Nagaraje Urs Appointed for Sectoral Scopes 1, 2, 3, 4, 5, 11, 12, 13 1, 2, 3 N/A N/A N/A 1, 13 Affiliation TV Rheinland India Ltd. TV Rheinland India Ltd. TV Rheinland India Ltd. TV Rheinland India Ltd. TV Rheinland India Ltd. TV Rheinland India Ltd.
3 VALIDATION FINDINGS
The findings of the validation are stated in the following sections. The validation criteria (requirements), the means of validation (document review, follow up interview) and the results from validating the identified criteria are documented in more detail in the validation protocol in Appendix A. The final validation findings relate to the project design as documented and described in the revised and resubmitted project design documentation and the key changes in comparison with the PDD originally (hosted for 30 days during GSC process).
3.1 Approval and participation

The table given below summarizes the project participant(s) and party (ies) involved. The letter(s) of approval /P03/ was found to be unconditional with respect to 45 (a) to (d) VVM, ver 01.2/B01/. The authenticity check of the submitted LoA /P03/ has been done through referring to the host DNA official website /B16/. This web-research reveals that the project has been approved by the host DNA and the same project title and name of PP is appearing on the website. Thus, validation team considers that the given one is authentic and thus confirms to the requirement of 47 VVM, ver 01.2/B01/. In line with the requirements of 49 and 50 of VVM, ver 01.2/B01/, the following table summarizes the details of the LoA: Project participant Parties involved Project title APPROVAL LoA received Date of LoA Reference to document LoA received from
Version No.:04
M/s Sapphire Industrial Infrastructures Private Limited India (host) 5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu Yes 01/02/2010 4/22/2009-CCC PP
Page 15
Validation Report
01 997 9105057438
Validation of authenticity Validity of LoA Additional information PARTICIPATION Party is party to Kyoto Protocol Voluntary participation Diversion of official development aid towards host country Project contribution to SD
Validation of authenticity of the LoA has been done through web-research 1 by referring to the official web-site of the host DNA /B16/. Yes, validation team considers the LoA in accordance with 45 to 48 VVM, ver 01.2 /B01/ No, LoA does not contain any additional specification of the project activity like PDD version number etc. Yes. India ratified the Kyoto protocol in August 2002 Yes in statement 2 of LoA. No. There is no Annex I country involved. Yes in statement 3 of LoA.
The validation of approval and participation has been done on the basis of 45-48 and 52-53 of VVM ver 01.2 and validation team confirms that the proposed project activity by SIIPL meets the requirement of 44 and 51 of VVM cer 01.2. Validation of ODA The validation team did not reveal any evidence that this Project activity can be seen as a diversion of ODA. It is also confirmed by the interview with Mr. Dinesh Narang Vice President Finance, SIIPL /I-01/ during site visit interview. The project proponent arranged its funding from internal accrual, the loan from Bank /P29/ and a grant from IFC /P11/. The means of finance for the project activity against the total project cost is tabularised below: S. No. 1. 2. 3. 4. Means INR (in Millions) Internal accruals(= Total Project Cost- Loan- Grant 285.9 from IFC) Loan from IDBI Bank /P29/ 490.00 Grant for IFC /P11/ 192.00
Total Project Cost (Consists of cost of supply and 967.89 services of plant & machinery and civil services /P12/, Cost of land /P30/, loan financing fee /P29/ and IDC /P13/).
Nevertheless CL-01 has been raised to get the affirmation from the PP and IFC that grant from the IFC does not result in a diversion of official development assistance and is separate from and is not counted towards the financial obligations of those Parties. In the response PP has provided an undertaking /P22/ that no diversion of ODA fund from the Annex I party has been used for the project activity and no CERs would be claimed by IFC in lieu of the grant given /P11/. A similar undertaking from IFC/P20/ has also been furnished to the validation team affirming that no CERs would be claimed by IFC in lieu of the grant. Hence the validation concludes that there is no ODA funding or diversion of ODA is involved in the project activity. Based on submitted document from the PP, CL-01 has been closed (ref Annex: Validation Protocol - Table 2).
http://cdmindia.in/reports_list_details.php?id=21&reporttype=1
Version No.:04
Page 16
Validation Report
01 997 9105057438
Confirmation of MoC The Modalities of Communication (MoC) /P04/, signed on 02/05/2011, was received from the PP. As required in Procedures for Modalities of Communication between Project Participants and the Executive Board, the Validation Team has verified that the name of Mr. Dinesh Narang Vice President Finance as sole authorised signatories for future communication related to the corresponding scope of authority with UNFCCC . The MOC has been checked as per the requirement of EB 45 annex 59 and found correct. The Validation Team confirms that the signatory and contact details on the MoC /P04/ are authorized and credible.
3.2 Project Design Document

The validation team validated that the Project Design Document is based on the currently valid CDM-SSC-PDD template, version 03 /B05/ and is correctly applied in accordance with the applicable guidance document /B05/.
3.3 Project Description

The project activity involves the construction of grid connected SPV power project of 5 MWp capacity in Sivaganga District in the State of Tamil Nadu India. The project site location in terms of Latitude (0904758.5 to 9048249 N) and Longitude (7802643.5 to 7802702.6 (E)) was checked from SEIA report prepared by ERM India Pvt. Ltd /P31/. Moreover, the location of the project activity site, as mentioned in the PDD was cross-checked during on site visit by the validation team. The project activity employs combination of different capacity SPV modules viz MBTF 76Wp, MBTF 78Wp, MBTF 80 Wp, MBTF 82 Wp , MBTF 84 Wp and MBTF 86 Wp. The modules which are installed under the project activity falls under same type 1/4size MBTF 100 modules. This MBTF 100 modules (a-Si Thin-film Module) and are tested and certified under IEC 61646 and IEC 61730) /P24/. The output capacity of this 1/4size MBTF 100 module has been defined by the manufacturer and are tested /P24/ at standard test conditions (STC) 25 degree C, AM -1.5 and irradiance 1000 W/m2, which is in line with the requirement of General Guidelines to SSC CDM methodologies/B05/, Version 16, foot note number 7. Total 2934 pieces of 76 Wp modules, 3618 pieces of 78 Wp modules, 11070 pieces of 80 Wp modules, 14238 pieces of 82 Wp modules , 28224 pieces of 84 Wp modules and 936 pieces of 86 Wp modules have been installed at the plant site and the total installed capacity of the modules comes to 5.009616 MWp and the same has been verified by the documentation of the SPV modules installed at the plant site provided by the supplier /P34/. Thus the total installed capacity of the SPV modules is 5.009616 MWp (DC power), which is specified by the manufacturer at testing conditions. Validation team further verified the output capacity of the power plant as 5 MW, as specified by the supplier (on the basis of manufacturer specification /P12/) /P34/ based on the total inverter capacity of 5000 kW (10 nos. of 500 kW each) installed at the plant site. This is inline with the requirements of 4(a) of general guidance version 16. The capacity of the SPV power plant is also cross verified from the Detailed Project Report /P13/, commissioning certificate /P33/, supply and service agreement /P12/ and SLD of the power plant /P21/, statutory clearances /P16/ and from Energy Purchase Agreement /P18/, /P19/ and confirmed to be 5 MW. The employed technology, i.e. a-Si Thin Module- SPV technology and the installed capacity of the power plant i.e. 5 MW are not expected to undergo any change within the crediting period. PP has submitted an undertaking /P26/, /P27/ in this regard that the technology and capacity would not change during the entire crediting period /P26/. The other equipments would be installed in the
Validation Report
01 997 9105057438
project activity like Transformers & Junction have also been verified through document review /P12/, SLD /P21/ and through onsite visit. The project plant will be predominantly south oriented and layout with flat panel of thin film type modules of PV array will be prepared. Photovoltaic module consists of several photovoltaic cells connected by circuits and sealed in an environmentally protective laminate, which forms the fundamental building blocks of the complete PV generating unit. Several PV panels mounted on a frame are termed as PV Array. No sun tracking device is installed for the PV Arrays. The technology being used in the project activity is indigenously available and is deemed to represent current good practice and state-of-the-art technology. The electricity generated by the project activity will be supplied to the TNEB grid. An EPA /P18/ has already been signed between SIIPL and TNEB for on grid export of electricity. The TNEB grid is a part of the southern regional grid of India as per CEA guidelines version 05 /B06/. The plant has commissioned on 20/12/2010 /P33/ and started the commercial operation. The estimated net electricity supplied figure works out as 8322 MWh per operational year. The project will result emission reductions of 7862 tCO2e per annum. The key technical features including the physical locations as mentioned in the PDD has been verified during on site visit and document review. The operation and maintenance of the project would be done by PP itself2. Nevertheless CAR-27 has been raised on the capacity of SPV modules used in the project activity and closed after sufficient justification and documentation provided by the PP and subsequent changes in the PDD. CAR-13 has been raised to provide the number of SPV modules installed at the project site. CL-02 has been raised by the validation team to clarify the provision of switch yard for 10 MW as mentioned in the service agreement and closed after convincing justification (ref Annex: Validation Protocol - Table 2). The project activity contributes to the sustainable development criteria of the host country /B07/ in terms of social, economical, technological and environmental benefits achieved due to the project activity. Emission reduction calculation has been done as per the applied methodology AMS I.D. ver 16 /B02/. The estimated net electricity supplied by the project activity to the grid is based on the Detailed Project Report /P13/ prepared by a third party, contracted by the SIIPL. The PLF of the project activity meets the requirement of 3 (b) of annex 11 of EB 48 and is deemed to be realistic. The net electricity supplied to the grid will be calculated ex-post by the difference of measured export and measured import of electricity as described in the monitoring plan of the PDD /P02/. Based on the information furnished by the project participants, no ODA contributes to the financing of the project. Temporal boundaries of the project are clearly defined. The starting date of project, project duration (life time) and crediting time are presented in the table below. Starting date of project /P12/ Expected project Crediting period operational lifetime /P12/, /P13/
However the PP may enter into separate O & M contract with a third party.
Version No.:04
Page 18
Validation Report
01 997 9105057438
29/01/2010 (Date of signing of 25 years Supply and service agreement /P12/). This can be treated as the earliest date on which the PP has committed expenditures related to project specific implementation and construction as per the Glossary of CDM Terms and 67 of EB 41 meeting report.
Renewable 7 years crediting period starting from 01/05/2011 or the date of registration, whichever is later.
The validation team verified the starting date from the date of signing of Supply and service agreement /P12/ dated 29/01/2010 between the PP and M/s Moser Baer Engineering & Construction Ltd. and expected project operational lifetime from the technical specification from the equipment manufacturer /P12/ and also from the Detailed Project Report /P13/. This was also cross checked with Annex 15 of EB 50 by the validation team and found comparable (=25 years). This grid connected solar photovoltaic power plant has obtained all local and sectoral statutory clearances as specified under Indian Electricity Act 2003 and project has got all statutory clearances /P16/ required to install the project including consent to establish /P16-(5)/. In summary, according to clause 64 of VVM, ver 01.2 /B01/, by means of document review and onsite interviews with stakeholders, the validation team considers the project description in PDD /P02/ Version 01.5 dated 22/03/2011 accurate and complete.
3.4 Baseline and Monitoring Methodology

3.4.1 Applicability of the selected methodology to the project activity
The project applies the approved simplified baseline methodology for selected small-scale CDM project activity categories, category I.D- Grid connected renewable electricity generation (AMS.I.D.) version 16 /B02/, which also uses the Tool to calculate the emission factor for electricity an electricity system version 02 /B03/. The selected version of the methodology at the time of hosting of PDD /P01/ is AMS I.D., version 15. Since it was not possible to request for registration before 10 Feb 2011 23:59:59 GMT (deadline for submission of request for registration), the validation team raised a CAR-28 in-order to adopt the latest methodology version. The PP has revised the PDD in accordance with the methodology AMS I.D., version 16. The validation team noted that the revision of this methodology in the PDD does not require re-web hosting in accordance with EB 50, Annex 48, 6. The revised PDD (version 01.5, dated 22/03/2011) /P02/ and ver 16 of AMS I.D /B02/ forms the basis of this validation report. Applicability criteria for the baseline methodology /B02/ are assessed by the validation team by means of document review and interview. It is agreed in the validation teams opinion that the project activity fully met the criteria as described below: Applicability criteria as Means of Validation per methodology /B02/ 1 of methodology. The project activity is a SPV based power plant of rated output capacity
Validation Report
01 997 9105057438
5 MW and has been checked from the document review mainly /P12/, /P13/. Furthermore, the electricity generated by the project activity will be supplied to the TNEB which is part of electricity generation system and comes under southern region grid of India as per the delineation of CEA /B06/ and this has been checked from the Energy Purchase Agreement /P18/ signed between the PP and TNEB which explicitly mention that the generated electricity from the project activity will be sold to the TNEB. It has also been noted by the validation team that since the project activity does not displace electricity from an electricity distribution system that is or would have been supplied by at least one fossil fuel fired generating unit hence methodology AMS-I.F. is not applicable for the present case. Bullet no. (a) of the paragraph 2 of the applied methodology is applicable for the present case as project activity install a new power plant at a site where there was no renewable energy power plant operating prior to the implementation of the project activity i.e. a Greenfield plant, the same has been checked from the document review /P01/, /P12/, /P13/, /P17/, /P18/, /P21/, /P30/ and from the onsite visit. The present CDM project activity is not a hydro project; hence this paragraph is not applicable for the subject project case. The present CDM project activity is not a biomass power plant; hence this paragraph is not applicable for the subject project case. The project activity is a 5 MW solar PV power plant and it does not involve any non-renewable component and verified from the documents /P01/, /P12/, /P13/, /P17/, /P18/, /P21/. The project activity is a 5 MW solar PV power project and is not a cogeneration project; hence paragraph is not applicable for the project. The project activity is a Greenfield project being implemented at a site where no SPV power plant exists and this is not a capacity addition project and verified from documents /P01/, /P12/, /P13/, /P17/, /P18/, /P21/, /P30/. Hence this paragraph is not applicable to the project. Furthermore, the capacity of the Greenfield project is below 15 MW and falls under small scale project activity. As stated above the project is a green field project and hence this paragraph is not applicable. The capacity of the Greenfield project is below 15 MW and falls under small scale project activity.
2 of methodology.
3 of methodology. 4 of methodology. 5 of methodology. 6 of methodology. 7 of methodology.
8 of methodology.
Thus the validation team confirms that the project participant correctly applied the approved methodology /B02/ for the project activity. There is no registered small-scale project activity under the CDM or an application to register another small-scale CDM project activity by the project participant within the previous two years with the same project category and technology within 1 km of the project boundary of the proposed project. This is confirmed by the validation team during the on-site interview with the representative of PP. In addition, the validation team has checked up with the UNFCCC website/CDM Pipeline published by UNEP RISO Centre3 and not identified other small-scale project being developed by the project participant. Therefore, the proposed project is not deemed to be a de-bundled
3
http://cdmpipeline.org/
Version No.:04
Page 20
Validation Report
01 997 9105057438
component of a large project activity. In accordance with Annex 13 of EB 54 the assessment of the de-bundling is presented in the adopted flowchart as below: Not Applicable (NA) Is there a registered SSC PA M/s Sapphire Industrial Infrastructures Private Limited with as the proposed SSC PA? No
Are the registered SSC PA and proposed SSC PA, type I activities providing energy to the same user? (as per EB30, paragraph 37) NA Are the registered SSC PA and the proposed SSC PA in transport sector involving boundaries/sources that are mobile? (as per EB 35, paragraph 58 & 59 ) NA
NA
Is there a registered SSC PA in the same project category and technology/measure as the proposed SSC PA? NA
NA
NA
Is the boundary of the registered SSC PA within 1 km of the boundary of the proposed SSC PA at the closest point?
NA
NA Is the registered SSC PA registered within the previous 2 years?

NA
NA
NA
Do SSC PAs comprise of independent subsystems/measures =<1% of applicable SSC threshold implemented in multiple locations (see para 7)? NA Does the total size of the proposed SSC PA combined with the registered SSC PA exceed the limits for SSC PAs? NA
The proposed SSC PA is deemed to be a debundled component of a large project activity and is not eligible to use the simplified modalities and procedures for
The proposed SSC PA is deemed to be a debundled component of a large project activity but can qualify to use simplified modalities and procedures for SSC PAs.
The proposed SSC PA is not deemed to be a debundled component of a large project activity, therefore is eligible to use the simplified modalities and procedures for SSC PAs.
Being a Solar PV based power project and according to the applied baseline and monitoring methodology AMS I. D. version16 /B02/, the validation team did not observe any fossil fuel fired equipment for on-grid connection or power supply to the project site. Apart from this, the validation
Validation Report
01 997 9105057438
team confirms that there would be no sources of project emission which are not addressed by the AMS.I.D/Version16 /B02/. However, the validation team while reviewing the information contained in the PDD /P01/ in section B.2, noted that justification is needed to be provided for each of the applicability conditions defined in the methodology including the foot notes. In this context CAR-26 was raised. The PP has addressed the requested changes in the revised PDD /P02/ and the validation team reviewed the same and found to be appropriate. Hence this CAR was closed (ref Annex: Validation Protocol Table 2). Thus the validation team considers that the project participant has correctly applied the approved methodology for the project activity.
3.4.2 Project Boundary

Project activity boundary is delineated as physical and geographical boundary of the Solar PV power plant and is adequately described in the PDD /P02/ in Section B.3. The projects system boundary includes solar PV arrays, inverters and transformers. The validation team was able to confirm that all the identified emission sources which are impacted by the project activity are addressed by the approved methodology /B02/ and can be seen in the Table below. Hence a clarification of revision to or deviation from the approved methodology /B02/ is not requested. Baseline emissions Project emissions GHGs involved CO2 Description Major emission source, which is emitted from the electricity generation by fossil fuel-fired power plants connected to the Southern grid. Project emission is regarded as zero as the project is a renewable energy (solar PV power plant) project. As per the applied methodology /B02/, leakage is to be considered in case of transfer of energy generating equipment from another activity. As this project activity is a green field project (as described in section 3.4.1 above) and there is no transfer of equipment from another activity (as the equipments used in the project activity is newly purchased /P13/) , leakage is not considered for this project activity as per the methodology.
N/A
Leakage
N/A
In the web hosted PDD /P01/, all the physical units has not been elaborated in the project boundary diagram. Hence CAR 02 was raised and successfully closed (ref Annex: Validation Protocol - Table 2).
Version No.:04
Page 22
Validation Report
01 997 9105057438
3.4.3 Baseline Identification

The identified baseline scenario, in line with the methodology AMS.I.D version 16 /B02/, is the equivalent electricity that would in absence of the project activity, have been generated by the operation of the grid-connected power plants belonging to the Southern regional grid. Determination of Baseline Emission The electricity baseline under the adopted methodology AMS I.D. version 16 /B02/ is calculated as the product of electrical energy baseline EGBL,y (Quantity of net electricity supplied to TNEB which is the part of southern grid) expressed in MWh of electricity produced by the renewable generating unit multiplied by the grid emission factor in accordance with 11, 12 of AMS I.D version 16 /B02/. According to AMS I.D. version 16 /B02/ 12, the Emission Factor can be calculated in a transparent and conservative manner as follows: a) A combined margin (CM), consisting of the combination of operating margin (OM) and build margin (BM) according to the procedures prescribed in the Tool to calculate the Emission Factor for an electricity system. OR b) The weighted average emissions (in kg CO2e/kWh) of the current generation mix. The data of the year in which project generation occurs must be used. PP has opted option a) and adopts the ex-ante calculation of emission factor of the grid. The combined margin emission factor for Southern grid of India has been calculated to be 0.944793 tCO2e / MWh. This has been calculated using the source from the Central Electricity Authority CO2 Baseline Database /B06/. Central electricity Authority (CEA) (under Ministry of Power, Government of India) have worked out baseline emission factor for various grids in India and made them publicly available. The data from CO2 Baseline Database for the Indian Power Sector User Guide Version 5.0 /B06/ is the most recent data at the time of submission of CDM-PDD for validation (Cp p5 of tool to calculate emission factor of an electricity system, version 02 /B03/). Validation team has checked the calculation of the combined margin grid emission factor and confirmed that the applied value of the emission factor follows the tool /B03/. And the values of OM and BM incorporated in the PDD /P02/ is taken from publically available database i.e. by CEA (Govt of India) /B06/. Nevertheless, following steps (step numbers correspond to tool to calculate emission factor of an electricity system, version 02) demonstrate the calculation of combine margin emission factor in accordance with tool to calculate emission factor of an electricity system, version 02. Step 1 - In line with the requirements specified in the tool /B03/, the PP has used a regional grid definition as applicable for large countries like India having layered electricity dispatch systems. The Indian power system is divided in two grids, the Northern, Eastern, Western and NorthEastern (NEWNE) Grid and Southern Grid. The project activity is connected to Southern Grid and hence for the purpose of estimation of baseline emission factor the consideration of Southern Grid is appropriate and correct. Step 2 - of the tool gives an option to include off-grid power plants in the project electricity system. CEA in its database for the Indian Power Sector User Guide - Version 5.0 /B06/ has considered only grid power plants for the analysis.
Version No.:04
Page 23
Validation Report
01 997 9105057438
Step 3 - Simple OM method, out of the four methods provided in the tool /B03/ for calculating the operating margin (EFgrid,OM,y) is selected. The tool /B03/ specifies that the simple OM method can only be used if the low-cost/must-run resources constitute less than 50% of total grid generation in :1) average of the five most recent years, or 2) based on long-term averages for hydroelectricity production. The Simple OM method selected is justified and appropriate as the average proportion of low-cost/must run resources is less than 50%. The ex-ante option for determining the simple OM is opted by the PP. Step 4 - The PP has considered the national published data (CEA database, ver 05 /B06/) for simple OM (This is in conformation with the 2, section B.6.1 of Specific guidelines for completing CDM-SSC-PDD, version 5 /B05/). The simple OM emission factor calculated by the CEA is the generation weighted average CO2 emissions per unit net electricity generation (tCO2/MWh) of all generating power plants serving the system, not including low-cost/must power plants (Cp page 6, User Guide CO2 Baseline Database, ver-5 for the Indian power sector /B06/). The value of simple operating margin for each year and the data for the calculation of EF grid, simple OM,y is published by the CEA /B06/ and is publically available. However, validation team has carried checked the published value of simple OM from the data available in CEA, version 5 /B06/ and found that PP has rightly calculated the generation weighted average value and this is in line with the tool /B03/ and arrived at the following summary: Year OM emission factor (tCO2/MWh) 0.9729248 0.9906235 0.9991209 Net Generation including imports(MWh) 121471250.5 114701739.3 109116377.5
2008-09 2007-08 2006-07
EFgridOM=(0.9729248*121471250.5+0.9906235*114701739.3+0.9991209*109116377.5)/( 121471250.5+114701739.3+109116377.5) = 0.987082 tCO2/MWh Hence validation team confirms that the PP has rightly followed the CEA database version 05 /B06/ and the EFgridOM for the southern grid is based on three year generation weighted average is inconformity with the tool to calculate emission factor, version 02 /B03/. Step 5 - Option (b) the set of power capacity additions in the electricity system that comprise 20% of the system generation (in MWh) and that have been built most recently has been considered by CEA and the same has been selected in the PDD. Validation team checked independently and confirm that the selection of the options is correct. This conclusion has been made based on the analyzing both the options, and it was found that the set of power as per option (b) comprises of larger annual generation and hence confirm the requirement of the tool /B03/. In validating this step, validation team further confirms that: (i) the identified power capacity additions comprise 20% of the system generation for the year under consideration. (ii) none of the considered power capacity additions considered under (i) above have been built more than ten years earlier. PP has fixed the Build Margin emission factor as ex-ante for the whole crediting period.
Version No.:04
Page 24
Validation Report
01 997 9105057438
Step 6 - The PP has considered the national published data (CEA database, ver 05 /B06/) for BM (This is in conformation with the 2, section B.6.1 of Specific guidelines for completing CDM-SSCPDD, version 5 /B05/). The CEA database /B06/ provides a BM value for the Sothern grid as 0.817923. As part of validation of Step 6 of the tool /B03/, Validation team has checked the BM for the year 2008-09 and found the same correct and in line with the tool. Step 7 of the tool /B03/ requires calculation of the combined margin emission factor as per the following equation: EFgrid,CM,y = EFgrid,OM,y x wOM + EFgrid,BM,y x wBM According to the tool /B03/ on selecting alternative weights, the default weights applicable for solar projects are wOM = 0.75 and wBM = 0.25 for the first and subsequent crediting period have been applied. The combined margin emission factor has been calculated as; EFy = 0.944793 tCO2/MWh (The official published data for simple OM and BM is considered for calculation of CM). The CM for the first crediting period is fixed ex-ante. Hence the validation team confirms that the PP has correctly calculated the combined margin grid emission factor and is in line with the tool to calculate emission factor, version 02 /B03/. Nevertheless CAR-03 has been raised and closed during the course of validation (ref Annex: Validation Protocol - Table 2). Table A-3: Parameter Assessment of assumptions used in Baseline Emissions Value Applied Unit Source of Information DOE Conclusion
BASELINE EMISSIONS Rated output Capacity of the plant 5 MW Technical Specification as mentioned in Supply and service agreement /P12/ and detailed project report /P13/. Detailed Project Report /P13/ Cross checked with technical specification provided by the manufacturer as mentioned in Supply and service agreement /P12/ and detailed project report /P13/ and found correct.
Plant Load Factor
19
As per the DPR prepared by third party contracted by the PP, same PLF has been submitted to the Bank, in line with EB 48 annex 11 requirement. Cross checked with the CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2009 (p46 of 77) /B17/, which refers to the same PLF for SPV power project.
Version No.:04
Page 25
Validation Report
01 997 9105057438
Combined margin for the Southern grid
0.944793
tCO2/MWh
Baseline Carbon Dioxide Emission Database Version 5.0, from CEA data base / B06/
Crosschecked with the Baseline Carbon Dioxide Emission Database Version 5.0, from CEA data base /B06/ and found OK.
Accounting of E + and E- policies to be (or not to be) considered in development of baseline scenario PP has included national and sectoral policies relevant to the baseline scenario as per EB 22 annex 3 in section B.4 of the PDD. Section B.4 reveals following national and sectoral policies in development of baseline scenario: 1. Electricity Act-2003 published in 26th May 20034 2. National Electricity Policy 20055 3. Tariff Policy 20066 4. National Rural Electrification Policies, 20067 At the conclusion, PP has concluded that all the above policies & circumstances mentioned above are E- policies (which gives comparative advantage to less emission intensive technology) and implemented since the adoption by the COP of the CDM M & P (decision 17/CP.7, 11 November 2001; hence need not to be considered in the development of baseline. Furthermore, all assumption like feed in tariff has been based on the EPA /P18/ and MNRE guidelines for grid connected solar PV project /B14/, which the project activity is entailed to avail. Validation team concludes that the assumptions taken for the demonstration of additionality is the most applicable, appropriate and realistic assumptions and hence the compliance of 2 of EB 53 annex 32 is not required and Instead the baseline scenario is based on hypothetical situation without the provincial and sectoral polices being in place. Hence the selection of baseline scenario confirms to Annex 3 of EB 22. Validation team further noted the following text of 27 of EB 55 meeting report: The Board considered draft "Guidelines on the treatment of national and sectoral policies in the demonstration and assessment of additionality and agreed not to continue the consideration of the treatment of national and sectoral policies in the demonstration and assessment of additionality. The Board also agreed that possible impact of national and sectoral policies in the demonstration and assessment of additionality shall be assessed on a case by case basis. Taking this in to account validation team confirms that national and sectoral policy need not be taken into account for the demonstration of additionality for the given project case. Nevertheless CAR-04 has been raised and closed during the course of validation (ref Annex: Validation Protocol - Table 2). Validation team has checked the following according to the latest version of Approved CDM Validation and Verification Manual version 01.2 /B01/, and the results are tabulated as follows:
4 5
http://www.powermin.nic.in/acts_notification/electricity_act2003/pdf/The%20Electricity%20Act_2003.pdf http://pib.nic.in/archieve/others/2005/nep20050209.pdf 6 http://www.karmayog.org/redirect/strred.asp?docId=2176 7 http://www.indg.in/rural-energy/policy-support/national-rural-electrification-policies-2006
Version No.:04
Page 26
Validation Report
01 997 9105057438
The approved baseline methodology applicable to the project - explicit criteria - implicit criteria (e.g. available scenarios, applicability of formulas for BE/PE/LE calculations) PDD includes all assumptions and data used by project participants All the references and documents used are relevant for establishing the baseline scenario All the references and documents used are correctly quoted and conservatively interpreted in the PDD All relevant policies / regulations considered are listed in the PDD Identified potential baseline scenarios reasonably represent what would/could occur in the absence of the proposed project activity The baseline scenario selection is appropriate and determined according to the methodology The approved methodology used is applicable to the identified baseline scenario
Yes No
As per clause 10, 11 and 12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details. As per clause 10, 11 and12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details. As per clause 10, 11 and 12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details. As per clause 10, 11 and12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details. As per clause 10, 11 and12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details. As per clause 10,11 and12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details. As per clause 10, 11 and12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details. As per clause 10, 11 and12 of the AMSI.D. /Version 16 /B02/, the simplified baseline is prescribed. Please refer Section 3.4.1 for details.
Yes No Yes No Yes No Yes No Yes No Yes No Yes No
3.4.4 GHG Emission Reductions

The GHG emissions reduction calculations are transparently documented and appropriate assumptions regarding the expected amount of electricity generated have been used to forecast emission reductions. According to the applied formulae in the PDD /P02/, the emission reductions (ERy) by the project activity during the crediting period is the difference between the baseline emissions (BEy) and sum of emissions arising from leakage (LEy) and project (PE y), which is expressed as follows:
ER y = BE y PE y LE y
While the leakage (refer section 3.4.2 of this report) and project emission are zero, the baseline emissions are equal to the emission reductions due to the project activity. According to the applied meth, the baseline emissions are demonstrated in Section B.6.1 of PDD and are calculated as follows:
Validation Report
01 997 9105057438
BE y = EG BL , y * EF CO 2 , grid , y
Where: BEy EG BL,y EF CO2,grid,y
(Cp Section B.6.3 of PDD /P02/)
Baseline Emissions in year y; t CO2e Quantity of net electricity supplied to the grid as a result of the implementation of the CDM project activity in year y (MWh) CO2 Emission Factor in year y; t CO2/ MWh
EF CO2,grid,y in this case is taken as Combined margin CO2 emissions factor for grid connected power generation in year y. EG BL,y is estimated as 8322 MWh. There would not be any project emission due to the project activity. Leakage is also not applicable as the transfer of equipment does not apply to this green-field project activity utilizing new purchased equipment (Cp 20 of AMS I.D, version 16 /B02/ and 50 of EB 44). So emission reduction is direct multiplication of quantity of net electricity supplied to the grid as a result of the implementation of the CDM project activity in year y (MWh) (export-import figure) and the grid emission factor. The emissions reductions due to the project activity were estimated ex-ante to be 7862 tCO2e per year in the PDD /P02/ and calculated as follows: ERy = BEy = EGBL,y * EF CO2,grid,y = 8322 MWh * 0.944793 tCO2e/MWh = 7862 tCO2e (rounded down) The summary of GHG emission reduction is as follows: All assumptions made for estimating GHG are listed in the PDD All data used by project participants are listed in the PDD Their references and sources are also listed in the PDD Formulas, parameters, values are complete, accurate, transparent and conservative All the references and documents used are correctly quoted and conservatively interpreted in the PDD Methodology has been applied correctly to calculate project emissions, baseline emissions, leakage emissions and emission reductions All the emissions of baseline emissions can be replicated using information provided in the PDD Yes No Yes No Yes No Yes No Yes No Yes No Yes No As per PDD /P02/ Section B.6 As per PDD /P02/ Annex 3 Baseline Information & Section B.6 As per PDD /P02/ Annex 3 Baseline Information & Section B.6 As per PDD /P02/ Annex 3 Baseline Information & Section B.6 As per PDD /P02/ Annex 3 Baseline Information & Section B.6 As per AMS I.D, Version 16 /B02/ and methodological tool, Tool to calculate the emission factor for an electricity system/Version 02/B03/. As per AMS I.D, Version 16 /B02/ and methodological tool, Tool to calculate the emission factor for an electricity system/Version 02/B03/.
Version No.:04
Page 28
Validation Report
01 997 9105057438
Nevertheless, CAR 05, were raised and successfully closed (ref Annex: Validation Protocol - Table 3).
3.5 Additionality
The project is small scale in size i.e. below 15 MW in line with the requirement of General Guidelines to SSC CDM methodologies/B05/, Version 16, foot note number 7. Therefore, in accordance with 28 of the simplified modalities and procedures for small-scale CDM project activities, the additionality of the project activity has been demonstrated using Attachment A to Appendix B, read with Annex 34, EB 35 /B02/ and Guidance given vide Annex 58 of EB 51 /B02/. As all requirements specified vide 28 of the simplified modalities and procedures are complied with by the project activity, this approach has been assessed to be appropriate for the additionality assessment for this project activity.
3.5.1. CDM consideration

Project developer had stated the start date of the project activity is 29/01/2010 and has submitted a copy Service and Supply Agreement /P12/ dated 29/01/2010 between the PP and M/s Moser Baer Engineering & Construction Ltd. as evidence. The project developer has not undertaken any construction or any real action on the implementation of the project activity prior to this date. Since the real action of the activity had begun on 29/01/2010, as per Glossary of CDM terms (Version 05) /B05/ and 67 of EB 41, this date has been treated as the start date of the project activity. Since the start date of the project activity is after 02 August 2008, the project activity falls under the category of new project activity as per paragraph 100 of VVM (01.2) /B01/. The PDD /P01/ was web-hosted for public comments on 19/03//2010, i.e., after the start date of the project activity. Since the start date of the project activity was after 02 August 2008 and the PDD /P01/ was web-hosted after the start date, as per paragraph 2 of Annex 22, EB 49 /B05/ [paragraph 101 of VVM (01.20 /B01/], project participant is required to inform the Host Party DNA and the UNFCCC secretariat in writing of the commencement of the project activity and of their intention to seek CDM status and such notification must be made within six months of the project activity start date. Project developer had informed both UNFCCC and DNA /P10/ on 20/02/2009 about their intention to seek CDM status. Copies of correspondence /P10/ with UNFCCC and DNA have been submitted to validation team. Besides, validation team also checked the UNFCCC website8 and satisfied itself that the project developer had informed UNFCCC on the said date. The project fulfills the condition stipulated vide paragraphs (2) of Annex 22 of EB 49 /B05/, [and paragraph 100 and 101 of VVM (01.2) /B01/]. Validation Team concludes that there was a prior consideration of CDM and CDM was seriously considered in the decision to implement the project activity. Nevertheless CAR-18 has been raised and closed during the course of validation (ref Annex: Validation Protocol - Table 2).
3.5.2. Alternatives
This is a solar PV power project and is based on the Methodology AMS I-D Ver. 16 /B02/. The methodology /B02/ states, If the project activity is the installation of a new grid-connected renewable power plant/unit, the baseline scenario is the electricity delivered to the grid by the
8
http://cdm.unfccc.int/Projects/PriorCDM/notifications/index_html (5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu Reg 20 /02/ 2009)
Version No.:04
Page 29
Validation Report
01 997 9105057438
project activity that otherwise would have been generated by the operation of grid-connected power plants and by the addition of new generation sources. Paragraph 105 of VVM, ver 01.2 /B01/ states that PDD is required to identify credible alternatives to the project activity in order to determine the most realistic baseline scenario, unless the approved methodology that is selected by the proposed CDM project activity prescribes the baseline scenario and no further analysis is required. Since the approved methodology AMS I-D, version 16 /B02/ used by the project activity prescribes the baseline scenario, no further analysis of alternatives is required for the project activity. Validation Team, therefore, concludes that the PDD /P02/ and the validation report conforms to the guidance given by EB vide paragraph 105 of VVM (Ver.01.2) /B01/.
3.5.3. Investment Analysis

PDD /P02/ demonstrates that the project would not be financially feasible, without the revenue from the sale of certified emission reductions (CERs). In order to assess the claim of the project developer that the project scenario is not economically feasible without benefits from CER sales, Validation Team adopted a six-pronged strategy, viz.,
a) determining the suitability of the investment analysis, benchmark applied and the suitability
thereof to the type of financial indicator presented;
b) conducting an assessment of parameters and assumptions used in calculating the financial c) d) e) f)

indicator and determining the accuracy and suitability of parameters; cross-checking the parameters against third-party or publicly available sources; reviewing annual financial reports related to the project participant; assessing the correctness of computations carried out and documented; and subjecting the critical assumptions of the project activity to reasonable variations to determine under what conditions variations in the result would occur, and the likelihood of these conditions.
a) Suitability of investment analysis, financial indicator and benchmark: Project developer had demonstrated that the financial returns of the proposed CDM project activity would be insufficient to justify the required investment [Paragraph 109 (c) of VVM (01.2) /B01/]. For demonstrating the financial unattractiveness of the project activity, project developer had chosen investment barrier and to demonstrate the investment barrier had selected benchmark analysis Since in this instant case, as subsequent section would reveal, baseline is outside the direct control of the project developer (grid connected power) and hence, the choice of the project developer is restricted to invest or not to invest, the benchmark approach is most suited as per the latest version of Guidance 16 of Annex 58 of EB 51 /B04/.
In the above background, as subsequent paragraphs would reveal, Validation Team concludes that the additionality justification given by the project developer is in accordance with the requirements derived from the approved CDM methodology and the methodological tools referred therein as well as the guidance given by EB vide paragraphs 108-110 of VVM (01.2 /B01/). The project developer has chosen Project IRR to demonstrate the additionality of the project. Considering the fact that the project is financed by a mix of debt and equity and that guidance 12 of Annex 58, EB 51 /B04/ permit the use of project IRR as one of the financial indicators to demonstrate additionality, project IRR has been considered as appropriate financial indicator for the project type and decision making context.
Validation Report
01 997 9105057438
As per guidance 12 of Annex 58, EB 51 /B04/, Local commercial lending rates or weighted average costs of capital (WACC) are appropriate benchmarks for a project IRR. The project developer has chosen the Prime Lending Rate (PLR), which is the commercial lending rate, as the benchmark. Since the PP has chosen project IRR as financial indicator, selection of PLR as benchmark conforms to Guidance 12 of Annex 58, EB 51. At the time of decision making (internal management decision dated 12/08/2008) /P09/ the PLR (evidenced by publications by the Reserve Bank of India) ranged between 12.75% and 13.25% 9 /B08/. PLR represents the commercial lending rate of banks. Therefore, the PLR as benchmark conforms to guidance 12 of Annex 58, EB 51/B04/. Moreover, since the PLR is publicly available and can be validated by DOE, it also conforms to guidance 13 of Annex 58, EB 51/B04/. PP has chosen the lower end of the range, viz., 12.75% as benchmark, which is conservative. Therefore, the Validation Team concludes that the benchmark selected by the project developer is suitable for the financial indicator selected and is conservative. Since the financial indicator equals the benchmark with CDM benefits, Validation Team considers that it is reasonable to assume that the investment would not have taken place and the CDM benefits were decisive factor in taking the investment decision. Therefore, the selected benchmark is appropriate and conforms to paragraph 112 (a) and (c)10 of VVM (01.2) /B01/.
b) Parameters and assumptions used:

The three important parameters, which determine the project IRR of the project, are project cost, financing pattern and profitability estimates. The source for various input parameters used in the financial indicator calculations and their assessment by referring to 110(a),(b) and (c) of VVM version 01.2 are discussed below in subsequent paragraphs, which also reveals that the input parameters considered in the financial indicator calculations conform to guidance 6 of Annex 58, EB 51 /B04/ or conservative. 1. Project Cost: The project cost includes land, civil works, plant and machinery, installation and commissioning, interest during construction and upfront fee payable to bank. Land cost is based on land sale deed dated 24/11/2009 between PP and M/s Century Agrotech Limited /P30/, civil works and plant and machinery costs are based on Supply Agreement /P12/ dated 29/01/2010 between the PP and M/s Moser Baer Engineering & Construction Ltd. , installation and commissioning costs are based on Service Agreement /P12/ dated 29/01/2010 between the PP and M/s Moser Baer Engineering & Construction Ltd., interest during construction (IDC) 11 is based on DPR prepared by ITCOT consultancy and services Limited, July 2008 /P13/ and loan processing charges (upfront fee) is based on loan sanction letter of IDBI dated 12/02/2010 /P29/. Copies of all these documents have been submitted to validation team. The cost of the project as
9
The PLR is sourced from the RBI Weekly Statistical Supplement issued by the Reserve Bank of India, which was available to the PP at the time of decision making (internal management decision) /P09/ (i.e., 12/08/2008). This rate pertains to 25/07/2008 See http://rbidocs.rbi.org.in/rdocs/Wss/PDFs/86214.pdf /B08/. The PLR as of 12/08/2008 can be sourced from 29/08/2008 issue (which was not available to the PP at the time of decision making). The PLR for the week ended 15/08/2008 was 13.25%- 14%. see http://rbidocs.rbi.org.in/rdocs/Wss/PDFs/86674.pdf . Paragraph 112 (b) of VVM version 01.2 /B01/ does not apply to the project as no risk premium has been applied in determining the benchmark As on 31/12/2010, SIIPL has paid INR 22.943 .mn. as IDC- has been verified from the bank statements /P27/. Hence considered IDC i.e. INR 10.034 mn. as per DPR /P13/ is a conservative assumption, which would lead to comparative higher IRR.
10
11
Version No.:04
Page 31
Validation Report
01 997 9105057438
per these documents works out to INR 967.89 mn and same has been considered in the financial analysis calculation /P08/. There is a difference in the project cost between the DPR prepared by ITCOT consultancy and services Limited, July 2008 /P13/ 12(based on which the internal management decision was taken in 12/08/2008) /P09/ and the cost considered for financial analysis /P08/. As per DPR prepared by ITCOT consultancy and services Limited, /P13/, which was prepared in July 2008, the cost of project at works out to INR 998.98 mn., while the cost considered for financial analysis /P08/ works out to be INR 967.89 mn only. Since the cost considered for financial analysis /P08/ is lower than that of the DPR /P13/, validation team deemed it appropriate to consider the cost considered in the financial analysis /P08/. Had the validation team gone by guidance 6 of Annex 58, EB 51 /B04/ the cost should be based on the DPR /P13/, which is higher than the cost considered for financial analysis /P08/. Consequently, the financial indicator would have been lower and project IRR would be 10.23%, if the cost had been based on the DPR /P13/ as against 10.84% based on cost considered for financial analysis /P08/. Hence, the cost considered in the computation of financial indicator is more conservative13. The cost of the project works out to INR 193.58 mn./MW (=967.89/5). Ministry of New and Renewable Energy /B17-2/ has estimated the project cost at INR170 INR200 mn14; where as CERC in their order CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2009 /B17-1/ has recommended a cost of INR180 mn.15. Validation team checked the cost assumed by other projects (available on UNFCCC homepage) and observed that so far only 3 projects (other than the candidate project) have web hosted the PDD. The cost of project projected by the other three projects are as follows: INR Mn./ MW Solar Power Generation Project 231 Reliance Ind. Ltd. Grid connected 3MWp Solar PV power plant in Belgum District of Karnataka State, India 3MWp Grid Connected Solar Power Project at Yalesandra Village, Kolar District, Karnataka, India Project activity
12
Project Activity
Reference web-link http://cdm.unfccc.int/Projects/Validation/DB /CW4U2U1WAD3WDPXSUC01XC4A4U4 GA0/view.html http://cdm.unfccc.int/Projects/Validation/DB /K6JDWJCC907P6A186V6QW2VDRIW2A A/view.html http://cdm.unfccc.int/Projects/Validation/DB /19WUKG07V1SC0DZZR3OA88M2KV1Y MU/view.html
207
197 193.58
DPR /P13/ was prepared by ITCOT Consultancy Services Ltd., a reputed consultancy organization. The DPR /P13/ was completed in July 2008. The Board took investment decision (internal management decision) /P09/ on 12/08/2008 i.e., within one month. Hence, all the values were valid at the time of decision making. The DPR /P13/ has been submitted to the Ministry of New and Renewably Energy, Government of India, based on which the generation based subsidy has been granted. Validation team also noted that the project cost actual (incurred) as on 31/12/2010 is higher than the project cost considered in IRR spread sheet. This is due to non consideration of certain assumption like miscellaneous expenses, contingencies and per-operative expenses and also due to increase in the IDC during period of construction. Hence the considered project in the IRR sheet is most conservative estimate and leads to a higher IRR.
13
Please see http://mnre.gov.in/press-releases/press-release-13072009-2.pdf /B17-2/ Please see http://www.cercind.gov.in/Regulations/Final_SOR_RE_Tariff_Regulations_to_upload_7_oct_09.pdf /B171/ (p.44/77).

15
14
Version No.:04
Page 32
Validation Report
01 997 9105057438
All the three projects are under validation. As evident, the cost of candidate project activity is the lowest amongst the projects which have web hosted their PDDs. Since the project cost represents the cost based on executed agreements /P12/, /P29/, /P30/ and conservative (as it is lower than the cost as per DPR /P13/) and compares well with other projects, validation team accepted the cost. 2. Financing Pattern: The equity involved in this project activity is INR 285.9 mn, interest free loan/grant from IFC, Washington of INR192 mn.16 /P11/ and term loan of INR490 mn. from IDBI Bank /P29/17. Bank had sanctioned the loan at 12% interest. Hence PP has considered the actual loan amount i.e. INR490 mn. and interest rate @ 12%, as verified from the loan sanction letter of IDBI dated 12/02/2010 /P29/. The actual interest payable by the project activity is taken into consideration, which is also in conformity with the guidance 11 of Annex 58, EB 5118/B04/. The same financing pattern (i.e. loan amount of INR 490 mn. and interest rate @ 12%) was also available with the PP at the time of decision making /P09/ and the detailed Project report /P13/ prepared by ITCOT consultancy in July 2008 considers the same. All other terms and conditions of loan sanction i.e. number of monthly equal installments, monthly repayment and moratorium period (in months) are same as mentioned in the loan sanction letter of IDBI dated 12/02/2010 /P29/ and the detailed Project report /P13/ prepared by ITCOT consultancy in July 2008. Hence conforms to guidance 6 of Annex 58, EB 51 /B04/. The project financing pattern yields a gearing of 70:30 (considering the interest free loan/grant from IFC, Washington as loan /P13/), which is based on actual loan sanctioned to the project activity by the IDBI bank dated 12/02/2010 /P29/. In India, infrastructure projects are generally entitled to a debt equity ratio of 70:30, though depending on the case the ratio can be marginally higher or lower. CERC /B17/ and all the State Electricity Regulatory Commissions recommend a debt equity ratio of 70:30 for solar energy projects. As the debt equity ratio is in conformity with the ratio recommended by CERC /B17/ and is also evidenced by the sanction letter IDBI bank dated 12/02/2010 /P29/, the validation team has accepted the financing pattern as correct and appropriate. The detailed Project report /P13/ prepared by ITCOT consultancy in July 2008 considers the same i.e. 70:30 debt-equity ratio, hence available with the PP at time of decision making i.e. internal management decision dated 12/08/2008) /P09/ and thus conforms to guidance 6 of Annex 58, EB 51 /B04/. The interest free loan/grant from IFC, Washington of INR192 mn as verified from the letter from the IFC dated 14/04/2009 /P11/ has been deducted by the total project cost while calculating the project IRR considering this as a grant, hence appropriate and acceptable. The detailed project report dated July 2008 /P13/ also mentions the IFC grant in the same tune i.e. INR 192 mn. and hence this was also known to the project developer at the time of decision making. 3. Profitability estimates: The profitability estimates of the project, which forms the basis for project IRR calculation is based on installed capacity, PLF, power tariff, O&M cost, interest, depreciation, taxation. Each of these assumptions used in the profitability estimates are discussed below: i. Installed capacity: The installed capacity of the project activity is based on the output capacity of Solar PV power plant, which is evidenced by the Supply and Service Agreement /P12/ dated 29/01/2010 and is the same as available with the PP at the time of decision making i.e. internal management decision dated 12/08/2008) /P09/, since the
16
IFC had sanctioned a loan/grant /P11/ of USD 4 mn. out of Global Environment Facility Trust Fund, for which the letter from the IFC was issued /P11/ on 14/04/2009. The loan will be converted into non-repayable grant upon commissioning of the project. In case the COD is not achieved by December 2010, the loan should be repaid in four equal annual installments without interest.
18
Guidance 11 of annex 58, EB 51 /B04/ states, In cases where a post-tax benchmark is applied the DOE shall ensure that actual interest payable is taken into account in the calculation of income tax
Version No.:04
Page 33
Validation Report
01 997 9105057438
detailed Project report /P13/ prepared by ITCOT consultancy in July 2008 considered the same capacity. The project rated output capacity i.e. 5 MW was further cross checked through document review namely all statutory clearances /P16/ and from Energy Purchase Agreement /P18/, /P19/ and found to be 5 MW, hence correct and acceptable. ii. PLF: As per Annex 11, EB 48 /B05/, the plant load factor (PLF) should be defined ex-ante according to one of the following three options: a. The plant load factor provided to banks and/or equity financiers while applying the project activity for project financing, or to the government while applying the project activity for implementation approval; b. The plant load factor determined by a third party contracted by the project participants (e.g. an engineering company). Project developer has submitted a copy of the DPR /P13/ dated July 2008, prepared by a reputed techno-economic consultant ITCOT consultancy and services limited, which estimates the generation at 8.32 mn. kWh, which yields a PLF of 19%. Hence this confirms to bullet no. (b) as stated above of EB 48 annex 11 /B05/. This DPR /P13/ which contains the same PLF (generation) has also been submitted to the IDBI bank and the same has been verified from the loan application letter of SIIPL dated 08/10/2009 /P28/, and thus also confirms to the bullet no. (a) as stated above of EB 48 annex 11 /B05/. Furthermore, this DPR /P13/ has also been submitted to the Ministry of New and Renewably Energy, Government of India, based on which the generation based subsidy has been granted. Hence validation team confirms that the PLF considered by the project activity is in line with EB 48 annex 11 /B05/ and also available with the PP at the time of decision making (i.e. internal management decision dated 12/08/2008) /P09/. To further cross-check the robustness of the PLF/generation taken, validation team by its own has calculated the generation (based on simulation results) of the project by using a software named as PV Syst- version 4.35 /B19/ and found the generation as 7.294 mn kWh (corresponds to 17 % PLF), hence the considered PLF i.e. 19% is appropriate (conservative as additionality point of view) and realistic and variation in upper side is not realistic. Validation team further noted that the generation figure estimated in the DPR /P13/ dated July 2008, prepared by ITCOT consultancy and services limited refers to 8.32 mn. kWh (corresponds to 19 % PLF), at the same time Supply and Service Agreement /P12/ dated 29/01/2010 mentions expected generation as 7.23 mn. kWh. In this context CL-09 has been raised and closed by considering the justification provided by the PP that the generation provided in the Supply and Service Agreement /P12/ dated 29/01/2010 considers an annual average generation over a period of project life time of 25 years considering degradation of SPV modules. Validation team further independently verified the PLF recommended by Government agencies and observed that CERC in their order CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2009(p46 of 77) /B17-1/ has recommended to same PLF i.e. 19%. Hence considering all above points validation team confirms that the assumed PLF (i.e. 19%) conforms to the requirements of Annex 11, EB 48 and is in conformity with PLF recommended CERC and the PLF is considered suitable and conservative (from additionality demonstration point of view) for the project activity and also available with the PP at the time of decision making
Version No.:04
Page 34
Validation Report
01 997 9105057438
iii.
Tariff: Solar power generation projects are entitled to generation based incentive provided by MNRE, Govt. Of India described in the report Guidelines for Generation Based Incentive published on January 2008 /B14/ , which is determined after deducting the power purchase rate for which EPA has been signed by the utility with a project developer, from a notional amount of INR 15 per kWh 19 . In all cases the maximum amount of generation-based incentive shall not exceed INR 12 per kWh. Hence, the total tariff plus incentive does not exceed INR15/kWh. The generation based incentive is available for a maximum period of 10 years 20 . Project developer has signed EPA with TNEB dated 09/11/2009 /P18/, which provides a tariff of INR4.50/kWh21 and hence the project is entitled to a generation based incentive of INR10.50/kWh. Project developer has taken into consideration both the tariff and generation based incentive in the financial indicator calculation. Since all the solar power projects in Tamil Nadu are entitled to the same tariff and incentive, the tariff considered also takes care of the concern expressed by CDM EB in its 49th meeting vide paragraph 48. Since the tariff is based on the EPA dated 09/11/2009 /P18/ and the generation based incentive is based on the MNRE guidelines /B14/, validation has accepted the tariff as correct and appropriate for the project activity and the same was available with the PP at the time of decision making (i.e. internal management decision dated 12/08/2008) /P09/, since the Detailed Project report /P13/ prepared by ITCOT consultancy in July 2008 considered the same tariff i.e. INR 15 per kWh(considering tariff provided by state utility and MNRE GBI). O & M cost: O&M cost is based on the Detailed Project report /P13/ prepared by ITCOT consultancy in July 2008 /P13/. The cost has been taken at INR 0.9 mn./MW with 5% escalation per annum. Project developer has assumed free warranty period of one year and the same has been verified from the Supply and Service Agreement /P12/ dated 29/01/2010, even though this free O & M for one year was not available with the PP at the time of decision making, consideration of this would lead to higher IRR, thus a conservative estimate for additionality point of view. The cross-check of appropriateness of O & M cost and escalation has been done by the validation team through web-research of govt. orders and by referring to other projects available on UNFCCC homepage. CERC in their order CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2009(p-47 of 77) /B17-
iv.
19
Clause 4.3 of Guidelines /B14/ for generation based incentive for grid interactive solar power generation projects (Order No. 32/61/2007-08/PVSE dated January 2008 states, The maximum amount of generation based incentive applicable for a project will be determined after deducting the power purchase rate for which EPA has been signed by the utility with a project developer, from a notional amount of INR 15 per kWh. In all cases the maximum amount of generation-based incentive shall not exceed INR 12 per kWh. In case the project developer has submitted to the state electricity regulatory commission or the utility or to the Ministry an application, where a lower power purchase price or sale price of power from the proposed grid connected PV power plant has been sought, in that case the generation based incentive will be determined with that amount as the base and a lower rate of incentive will be approved by the Ministry. The project developers will be required to submit documentary proof and give an undertaking about correctness of this information. See http://www.mnre.gov.in/pdf/guidelines_spg.pdf . Clause 4.6 of the Guidelines /B14/ states, The generation based incentive approved for a grid interactive PV power generation project may be available for a maximum period of ten years from the date of approval and regular power generation from that project, provided the utility continues to purchase power from that grid interactive PV power plant Project developer entered into EPA with the State Utility on 20/08/2009 /P19/, which provided for a tariff of INR 3.15/kWh, which was based on the tariff order no. 6 dated 11/07/2008 /B10-1/. However, consequent upon the revision of tariff by TNER (in its amendment of tariff order no.06 dated 22/09/2009 /B10-02/) from INR 3.15/kWh to INR 4.50/kWh, the project developer entered into a revised EPA on 09/11/2009 /P18/. The Detailed Project Report /P13/ prepared by ITCOT consultancy in July 2008 contains a tariff of INR3.15/kWh. However, as the overall accrual from the sale of power is restricted to INR15/kWh (higher tariff will lower the generation based incentive and vice versa), the impact of this agreement (though post dated to decision making), on the financial indicator calculation is nil. Project developer has furnished copies of both the agreements /P18/, /P19/.
20
21
Version No.:04
Page 35
Validation Report
01 997 9105057438
1/ have recommended O & M cost of INR 0.9 mn./MW with 5.72% escalation per annum. Validation team further compared the O & M cost with that of other projects and found that Solar Power Generation Project (Reliance Industries Ltd.) has assumed O & M cost at INR 0.9 mn./MW with 5.72% escalation. Based on above assessment validation team confirms and accepted the O & M cost and escalation and also confirms to the requirement of guidance 6 of EB 51 annex 58 /B02/. v. Depreciation: The project developer has adopted straight line depreciation as per Schedule XIV of the Companies Act, 195622 /B09/ for computing book profit and Income Tax Act stipulated WDV depreciation for income tax calculation, which are accepted accounting methods. The block of assets has been computed for depreciation purpose as per the accepted accounting principles. Tax liability has been calculated as per the income tax rules /B13/ and the rulings given. In computing the income tax liability, the project developer has not taken into account the accelerated depreciation, which the solar power projects are entitled to, because as per MNRE guideline on Generation based incentive on grid interactive solar PV power plant (p- 2 and 4 of 7) /B14/ project developer would not be entitled to generation based incentive in case the project avails accelerated depreciation23. Since generation based incentive has been taken into consideration in the financial indicator calculation /P08/, the project developer is not entitled to accelerated depreciation. Hence, the normal depreciation rate applicable has been taken into consideration while computing tax liability. The tax rate assumed corresponds to the tax rate prevailing at the time of taking decision (conformity to guidance 6 of Annex 58, EB 51 /B04/).
Since the input parameters have been sourced either from the DPR, Supply and Service Agreements, loan sanction letters, acts and regulations, they were valid at the time of decision making, (or modified to ensure conservativeness in the computation of financial indicator), are reliable, credible and appropriate for the project activity. Thus, the Validation conforms to the guidance given vide paragraph 111,112 and 114 of VVM (01.2) /B01/.
c) Cross checking parameters: The cost of civil works, plant and machinery, PLF, power tariff,
O & M cost, interest costs, depreciation and tax rate have been cross checked with DPR /P13/, Supply and Service Agreements/ P12/, MNRE regulation /B14/, Tariff orders /B-10/, loan application letter /P28/, loan sanction letter /P29/ and Energy Purchase Agreement /P18/, /P19/ Income Tax Act /B13/ and other projects as assessed and described in the preceding pages for each and every parameters/assumptions. Validation team apart from referring the documents submitted by PP referred to other sources like public available documents like tariff orders, regulations, other technical paper/software (in case of PLF) and other CDM projects available on UNFCCC homepage to cross-check the validity/authenticity/credibility/reliability and appropriateness of the used values in the IRR spread sheet /P08/. The documents supporting to the financial calculations, in the opinion of Validation Team, are authentic, credible, reliable and appropriate. CARs and CLs were raised on non-conformities and they were set right. With the corrections having been incorporated, the input costs considered appear to be in order. Validation team, therefore, conforms to guidance given vide paragraphs 111(b), (c) of VVM (1.2) /B01/.
22 23
www.fastfacts.co.in/resources/DepCoAct.rtf
http://www.mnre.gov.in/pdf/guidelines_spg.pdf , Clause 3.16 of Guidelines for generation based incentive for grid interactive solar power generation projects (Order No. 32/61/2007-08/PVSE states, PV power project developers shall not avail accelerated depreciation benefit under Section 32 of the Income Tax Act 1961. The PV power project developers, who submit their applications to the Ministry with a copy to IREDA and required to submit a declaration to this effect. On approval of the project, IREDA will enter into an agreement with the project developer, among other matters, in this regard. If any violation of this condition is found, IREDA will immediately stop release of generation-based incentive to that project and refer the matter to the Ministry.
Version No.:04
Page 36
Validation Report
01 997 9105057438
d) Financial reports of project participant: Validation team requisitioned the Annual Report of
the project developer for the IFY 2009-10 audited by a 3rd party financial auditors /P25/ Since this is a new company and the project is under implementation, the Annual Report/balance sheet /P25/ contains only investment made till March 31, 2010. However, the Validation team observed that the project has not yet been commissioned as of March 31, 2010 and that the only a sum of INR 549 mn. till that date, while in the worksheet /P07/ originally submitted, the project developer has reckoned the entire investment in 2009-10. Since it impacts the financial indicator and hence the additionality, CAR -23 has been raised and project developer was asked to rectify the cash outflow, which was done. Had the entire cash outflow been reckoned in 2009-10, project IRR would be lower by 50 basis points. input taken from DPR/supply and service agreement/loan sanction letter/documents, adoption of correct accounting principle and arithmetical accuracy. Validation Team checked the documents and ensured that right input has been taken in the project cost and projections. In a few places, the calculations were not conforming to accepted accounting principles and the laws and regulations in force necessitating CARs and CLs. Based on the CARs and CLs, corrections were incorporated. The accounting principles adopted with respect computation of interest, block of assets and tax computation were found to be in order in the corrected version /P08/ presented. The arithmetical accuracy was also found to be correct. The project IRR has been computed for a period of 25 years, which is the life time of the project and verified from the detailed Project report /P13/ prepared by ITCOT consultancy in July 2008 and as per manufacturer specification as given in the Supply and Service Agreement /P12/ dated 29/01/2010. This 25 year life time is in conformity with the Annex 58 of EB 51 /B04/ and Annex 15 of EB 50/B05/. As required by Annex 58 of EB 51 /B04/ the expected realisation on the sale of assets at the end of the operating life has been taken as salvage value in the terminal year. In computing the IRR /P08/, the project developer has taken into account profit after tax, depreciation and interest on term loan and salvage value (in the terminal year). The principle adopted conforms to the accepted accounting and taxation principles.
e) Assessment of correctness of computation: The assessment involved checking the data
Based on the above, the project IRR works out to 10.84% 24 in contrast to the benchmark of 12.75%. In the above background, the Validation Team is convinced that the project is additional and not a business-as-usual scenario. Sensitivity analysis: The Guidance on Assessment of Investment Analysis /B03/ requires the robustness of the conclusion arrived at to be proved through a sensitivity analysis by varying the critical assumptions to a reasonable variation. The project developer has identified generation (PLF), tariff, project cost and O&M cost as critical assumptions. While the first three parameters constitute more than 20% of the project cost/revenue, O&M cost accounts for 12 % of the project revenue which is less 20% of the project revenue. Nevertheless, project developer has chosen to subject O&M cost also to sensitivity test as it is the only cost. Guidance 18 of Annex 58 of EB 51 states that as a general point of departure, variations in the sensitivity analysis should at least cover a range of +10% and 10%, unless this is not deemed appropriate in the context of the specific project circumstances. Accordingly, all these parameters have been subjected to 10% variation on either side. The sensitivity analysis reveals that even under more favorable conditions, the IRR would not cross the benchmark return (except in the case of project cost) as given in the following table:
24
In the webhosted PDD /P01/, the financial indicator (project IRR) was 9.99% Page 37
Version No.:04
Validation Report
01 997 9105057438
Input Parameters Generation (PLF) Power tariff Project Cost O&M cost
-10% 9.15% 10.63% 13.06% 10.94%
Base-case project IRR 10.84% 10.84% 10.84% 10.84%
+10% 12.43% 11.04% 9.10% 10.73%
Validation Team carried out its own independent assessment, which reveals that the project would become non additional if Generation goes up by 12.15% Project cost goes down by 8.80% Tariff goes up by 117% O & M cost goes down by 206%. Such a reduction in project cost or O & M cost or increase in PLF or tariff is highly unrealistic and unlikely to happen and reasoned out as follows: Generation: The generation capacity of a solar PV power plant is computed on a system performance model, taking in to account the solar radiation, day length, working temperature, voltage generation at solar PV module, losses within the system as well as operator defined factors such as dust rating, grid interaction and transmission losses, etc and thus it is project specific. PLF in base value has been taken from the detailed project report /P13/ prepared by a third party consultant contracted by PP. Validation team has checked that this estimation of the PLF in the DPR /P13/ is based on system modelling which consider site specific data to get the generation figure and the solar radiation taken into account is based mean sunrise hours taken from Solar Radiation Hand Book (2008) /B18/, which covers a period of 1986-2000. Hence gives a realistic figure of mean sunrise hours, which is a critical parameter for the determination of generation. Hence the generation/PLF based on the DPR /P13/ is a realistic figure and any variation in this that to by +12.15% is not possible. To check the robustness of the PLF/generation taken and to check the likelihood of the generation rise by 12.15% (which make the project non additional), validation team by its own has checked the generation (based on simulation results) of the project by using a software named as PV Systversion 4.35 /B19/ and found the generation as 7.294 mn kWh (corresponds to 17 % PLF), hence the considered PLF i.e. 19% is appropriate (conservative as additionality point of view) and realistic and variation in upper side is not realistic. Moreover, the PLF assumed is also in conformity with the PLF recommended by CERC in their order CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2009(p-46 of 77) /B17-1/ . Therefore to achieve a PLF of 21.3% (which 12.15% escalation tantamount to) on a sustained basis is not possible. Project cost: As stated above, the cost taken into computation /P08/ is based on Supply and Service Agreements /P12/ dated 29/01/2010 between the PP and M/s Moser Baer Engineering & Construction Ltd25, land sale deed dated 24/11/2009 /P30/ between M/s Century Agrotech Limited,
25
DPR /P13/ estimates the project cost at INR 999 mn. while the cost project cost works out to be INR967.9 mn. only. Since the project cost represents the cost based on executed agreements i.e. Supply and Service Agreements and other agreements and it is lower than that of the DPR /P13/, validation team felt that project cost considered in the financial analysis /P08/ is appropriate and conservative. Had the validation team gone by guidance 6 of Annex 58, EB 51 the cost should be based on the DPR /P13/, which is much higher than the cost considered. Consequently, the financial indicator would have been lower.
Version No.:04
Page 38
Validation Report
01 997 9105057438
upfront fee from loan sanction letter of IDBI dated 12/02/2010 /P29/ and IDC 26 from detailed Project report /P13/ prepared by ITCOT consultancy in July 2008. Since the cost as per Supply and Service Agreements /P12/,land sale deed /P30/ and upfront fee from loan sanction letter of IDBI /P29/ and IDC have already been entered into( based on executed agreements) , reduction in the cost considered in the IRR spread sheet /P08/ is not possible27. Therefore the project cost represents a firm cost and as such the question of any reduction in the cost is hypothetical. Tariff: The tariff is based on the EPA dated 09/11/2009 and the MNRE guidelines /B14/ on the subsidy. The tariff is fixed for 10 years and as per MNRE guidelines the subsidy would be available for only 10 years. It is not possible that the tariff rate would change before 10 years as it is fixed for 10 years and as per the MNRE guidelines on GBI /B14/, the project is entitled to avail a rate of maximum INR 15 per kWh, which includes both GBI and tariff so any increase in the tariff would lead to decrease in GBI and hence the net impact would be nil. Nevertheless, tariff has been subjected to 10% increase (after 10th year) and it was observed that the project does not lose its additionality. Since the quantum and the period of subsidy is restricted, the tariff has to go up INR 9.77/kWh (which 117% escalation translates to) for the project to become non-additional. As the tariff was revised only on 09/11/2009, in the revised EPA /P18/ and has already been signed and the tariff is fixed for 10 years, any increase in tariff is unrealistic. O & M Cost: As regards O & M cost, validation team observed that the project does not become non-additional, if the O&M cost goes down by 206%. Validation team noted that the reduction in this recurring expanses is not possible taking into consideration of the inflation28 that the India is experiencing. Hence validation team confirms that reduction in the O & M cost is not realistic and reduction in O & M cost is ruled out. Validation Team is in agreement with the reasoning given by the PP and hence concludes that such an increase in tariff or generation or reduction in project cost is unrealistic and hypothetical. As regards O & M cost, validation team observed that the project does not become non-additional, even if the entire O & M cost is removed. Hence, it is not a critical factor at all. Having regard to the assessment of conformity of additionality demonstration and benchmark selection to the latest version of the guidance issued by EB on the assessment of investment analysis, plausibility and appropriateness of parameters used and correctness of financial calculations, Validation Team concludes that the project scenario is not economically feasible without benefits from CER sales
3.5.4 Barrier due to prevailing practice

As per Attachment A to Appendix B read with Annex 34, EB 35, project developers of SSC Projects need to demonstrate that the project activity would not have occurred anyway due to at
26
As on 31/12/2010, SIIPL has paid INR INR 22.943 mn. as IDC- has been verified from the bank statements /P27/. Hence considered IDC i.e. INR 10.034 mn. as per DPR /P13/ is a conservative assumption, and the actual IDC is much higher than the considered one, thus this component of project cost would not tilt the IRR at all. Validation team also noted that the project cost actual (incurred) as on 31/12/2010 is higher than the project cost considered in IRR spread sheet. This is due to non consideration of certain assumption like miscellaneous expanses, contingencies and per-operative expanses and also due to increase in the IDC during period of construction. http://www.euroekonom.com/graphs-data.php?type=inflation-rate-india&time=-1
27
28
Version No.:04
Page 39
Validation Report
01 997 9105057438
least one of the barriers, viz., investment barrier, access-to-finance barrier29, technological barrier, barrier due to prevailing practices and other barriers. Though the project developer has demonstrated additionality through investment barrier, prevailing practices barrier has also been used to further strengthen the argument that the project is additional. As suggested by Annex 34, EB 35, project developer has demonstrated that the project is among the first-of-its-kind in terms of technology, geography, sector, type of investment and investor, market etc. Validation team adopted a three- pronged strategy to validate the barrier identified by the project proponent, viz., i) evaluation of the veracity of the claim made by the PP; ii) compliance of the project activity with the stipulated conditions to claim the status; and iii) evaluation of whether the barrier present insurmountable hurdle to the project activity. Annex 34, EB 35 requires the satisfaction of one of the five conditions for classifying the project as first-of-its-kind, viz., technology, geography, sector, type of investment and investor and market. For demonstration of this barrier project promoter has rightly considered entire India as a region and grid connected Solar Photovoltaic power as a technology, which is deemed to be appropriate. Furthermore, the demonstration by the PP in section B.5 of the PDD /P02/ is correct and represents the actual prevailing practice in the country for power generation. Validation team has noted that PP has presented the share of thermal power plants in India which accounts for approximately 64% of the total installed capacity as on 31/03/2008. Approximately 25% of the total installed capacity is from hydro power plants and 8 % is from other renewable energy sources. The share of grid connected solar PV project accounts for 0.00147% only of the total installed capacity as on 31/03/2008. It has been verified from the MNRE website30 that India has a potential of 50 MW/sq.km. from grid connected SPV power plant. It is imperative to note here that the decision (internal management decision) /P09/ for this project has been taken on 12/08/2008; at the time of conceptualization of the project the total installed capacity of grid connected Solar Photovoltaic power was 2.12 MWp31 (as on 31/03/2008) in India. There was no growth until 31/03/2009 and the installed capacity remain 2.12 MWp32, while the installed capacity of the candidate project activity is 5 MW, i.e., more than two times the total installed capacity in the country. This 2.12 MWp capacity consist of a total of 33 grid interactive solar photovoltaic power plants and that too with financial support33 from the Government. Hence validation team concludes that this 2.2 MWp capacity is not deemed to be appropriate to compare with PA, due to the nature of investment (project activity- private investment while all 2.12 MW through government support) and due to scale (project activity- 5 MW alone while 2.12 MW consists of 33 projects) and confirms that there were no Solar PV power project commercially operational of the size comparable to the candidate project, in private sector in India. Validation team confirms that implementation of solar photovoltaic power project is not a prevailing practice in India and further confirms through independent web-research that the project activity is one of the first34 grid-connected solar projects to be developed in India and one of the largest solar farms in
29 30
This does not form part of Attachment A to Appendix B, but finds place in Non-binding best practices examples to demonstrate additionality of SSC project activities (Annex 34, EB 35) http://mnre.gov.in/annualreport/2008-09EN/overview.htm 31 http://mnre.gov.in/press-releases/press-release-31032008.pdf 32 http://mnre.gov.in/annualreport/2008-09EN/overview.htm , please refer to table 1.1 33 http://mnre.gov.in/press-releases/press-release-31032008.pdf 34 http://www.ifc.org/ifcext/spiwebsite1.nsf/1ca07340e47a35cd85256efb00700cee/BD4AEAC1C2D6A0A7852576BA000E 2DAF , please click the web-link then click Development Impact to get the quoted reference.
Version No.:04
Page 40
Validation Report
01 997 9105057438
emerging market countries, and indicating that grid connected solar PV project is not a prevailing practice in India. Validation team therefore confirms that demonstration of Barrier Due to Prevailing Practice confirms the requirement of Non-binding best practice examples to demonstrate additionality for SSC project activities (EB35, Annex 34) /B03/, which states prevailing practice or existing regulatory or policy requirements would have led to implementation of a technology with higher emissions; Best practice examples include but are not limited to, the demonstration that project is among the first of its kind in terms of technology, geography, sector, type of investment and investor, market etc. Validation team further assessed this barrier, taking the guidance of CDM-Meth Panel 34 meeting report, annex 10 Note on the barrier first-of-its-kind (which is not yet endorsed by EB), which recommended a definition on First-of-its-kind project activity. As per the recommendation, the project activity should comply with the following conditions to qualify as First-of-its-kind status, viz., (a) The project technology has not been in commercial operation in the applicable geographical area; and (b) The project technology has not been proposed in another CDM project activity in the applicable geographical area and published in the CDM-PDD by a DOE for public comments. Publicly available information reveals that a grid interactive solar photovoltaic power project with 2 MW capacity35 under the demonstration programme of MNRE has commissioned on 08/12/2009 by West Bengal Green Energy Development Corporation Limited in Asansol District in West Bengal. Besides, as mentioned earlier (in section 3.5.3, three more projects with an installed capacity of 5 MWp and 3 MWp have been crystallised and have web-hosted the PDD for GSC after the candidate projects PDD was web-hosted. The dates on which the PDDs are hosted on UNFCCC homepage is summarised below: Project Activity Solar Power Generation Project Reliance Ind. Ltd. Grid connected 3MWp Solar PV power plant in Belgum District of Karnataka State, India 3MWp Grid Connected Solar Power Project at Yalesandra Village, Kolar District, Karnataka, India Project activity Hosting date 22/07/20l0 Reference web-link http://cdm.unfccc.int/Projects/Validation/D B/CW4U2U1WAD3WDPXSUC01XC4A4U 4GA0/view.html http://cdm.unfccc.int/Projects/Validation/D B/K6JDWJCC907P6A186V6QW2VDRIW 2AA/view.html http://cdm.unfccc.int/Projects/Validation/D B/19WUKG07V1SC0DZZR3OA88M2KV1 YMU/view.html
10/08/20l0
10/08/20l0 19/03/2010
Hence, there were no Solar PV power project commercially operational of the size comparable to the candidate project, in private sector in India. Hence, the first condition of Annex 10 of MP 34 is satisfied. Hence, validation team confirms that implementation of solar photovoltaic power project is not a prevailing practice in India. CDM MP had suggested that if several project activities, employing the same technology within the applicable geographical area, have been submitted to the DOEs for validation before starting their commercial operation, respective project participants could simultaneously claim that no other
35
http://eai.in/blog/2010/06/status-of-solar-pv-power-plant-in-asansol-west-bengal.html
Version No.:04
Page 41
Validation Report
01 997 9105057438
project activity has started commercial operation and that their project activities are all first-of-itskind. As pointed out earlier, no Solar PV power project activity was in operation or even published the PDD for GSC before the candidate project. Therefore, the project is first-of-its-kind in the country. Based on the foregoing, the Validation Team concludes that the project activity faces investment barrier - in as much as the project IRR is less than the benchmark - and continue to remain additional even under most optimistic assumptions (based on sensitivity analysis)- and prevailing practice barrier (first-of-its-kind). The fact that the project is first of its kind also goes to prove that setting up of grid interactive Solar PV Power plants is not a common practice in the country. Being the first of its kind, the project faces the problems associated with first entrant to industry. Thus, the Validation Team has arrived at the conclusion that the project activity is additional and is not a business-as-usual case. The CDM revenues are necessary to overcome the barrier identified above. Nevertheless CAR-16, CAR-17 and CL-08 has been raised and closed during the course of validation of barrier due to prevailing practice (ref Annex: Validation Protocol - Table 2)
3.5.5 Summary
In the above background, Validation Team concludes that the project is not a business-as-usual scenario and is additional. The CDM benefits would enable the project to become financially attractive in as much as the project IRR with CDM benefits (12.78%) (considering CER price @ 22 euro/ CER) would equal the benchmark (12.75%) and hence CDM benefits would enable the project developer to overcome the barrier. Nevertheless CAR 14 to CAR-25 and CL-01, CL-03 and CL-08-16 have been raised and closed during the course of validation successfully (ref Annex: Validation Protocol - Table 2).
3.6 Monitoring
The monitoring plan is included in Section B.7 of the PDD /P02/ based on the approved monitoring methodology AMS I.D/Version 16 /B02/ titled Grid connected renewable electricity generation and is correctly applied to the CDM project activity. This methodology /B02/ stipulates that monitoring shall consist of monitoring of Quantity of net electricity supplied to the grid in year y. This confirms the requirement of 122 of VVM ver 01.2 /B01/.
3.6.1 Parameters determined ex-ante

The project adopts the ex-ante calculation of emission factor of the grid. The OM and BM are calculated as fixed factors for the first renewable crediting period by choosing data vintage based on ex-ante data published by CEA /B06/. The parameters for determining the GHG emissions reductions have been clearly demonstrated in section B.6.2.of the PDD /P02/. The combined margin emission factor for the southern grid of India has been calculated to be 0.944793 tCO2 / MWh. The validation team has verified the value used against the sources and conclude that all relevant parameters to calculate the GHG emissions reductions of the project have been sufficiently considered and the value of the parameters are real, measureable and conservative.
Version No.:04
Page 42
Validation Report
01 997 9105057438
Nevertheless CAR-03 and CAR-06 has been raised and closed during the course of validation of barrier due to prevailing practice (ref Annex: Validation Protocol - Table 2).
3.6.2 Parameters monitored ex-post

The data required to be monitored ex-post include: Quantity of net electricity supplied to the grid in year y The PDD has mentioned this monitoring parameter in section B.7.1. The monitoring plan related to electricity metering consists of two parameters monitoring representing metering of export and import electricity at the evacuation point to the grid by dedicated meters. The quantity of net electricity supplied to the grid in year y will be calculated as difference of exported and imported electricity which are directly metered in an export-import meter. The export and import will be measured continuously and recorded monthly.
3.6.3 Management system and quality assurance

Steps undertaken to assess the monitoring plan Compliance of the monitoring plan with the approved methodology According to the PDD /P02/, the projects monitoring plan outlines the followings: Monitoring parameters: the monitoring parameter of the project includes quantity of net electricity supplied to the grid in year y (= Total export Total import) by the project activity as described in section B.7.1 of the PDD /P02/.. Operational and management structure: management structure is illustrated for the CDM project monitoring; Monitoring Equipment and Relative Location: metering equipment to monitor export and import of electricity (to calculate Quantity of net electricity supplied to the grid in year y by the project activity) Quality Control and Data Archive: arrangement of meter calibration; archiving of the data collected during monitoring; and collection of monitored data and report preparation. Quantity of net electricity supplied to the grid in year y is monitored as per the requirement of 22 bullet (5) of the monitoring methodology /B02/ applied for the project activity and hence confirms compliance of 123(a) of VVM ver 01.2 /B01/. Implementation of the plan According to document review in the PDD and on-site interviews with the representatives of the PP /I-03/, detailed monitoring procedures, monitoring structure, management team, monitoring items and functions are clearly demonstrated in the PDD which will enable subsequent verification of the projects emission reductions in line with the applied methodology. The validation team confirms that as per 24 of EB 23, the specific uncertainty levels, methods and associated accuracy level of measurement instruments and calibration procedures used for various parameters and variables are identified in the PDD /P02/, along with detailed quality assurance and quality control procedures. The accuracy class and the method and frequency of calibration of the electricity meters confirm to the national standards /B15/. This also complies with 12 of the general guidelines of the small scale project activities EB 52, annex 14. All the monitored data will be archived until 2 years after the crediting period to facilitate cross-checking during the crediting period.
Version No.:04
Page 43
Validation Report
01 997 9105057438
Hence the validation team considers that the PP is capable to implement the monitoring plan and hence confirms compliance of 123(b) of VVM ver 01.2 /B01/. Nevertheless, CAR-08, CAR-09 and CL-04 were raised and successfully closed (ref Annex: Validation Protocol - Table 2).
3.7 Sustainable Development

The host partys DNA, Ministry of Environment and Forests of India has confirmed the contribution of the project to the sustainable development in India according to the Letter of Approval for the Project /P03/, which was checked by the validation team to be valid. Also, during interview with Mr. Dinesh Narang /I-01/, that permanent job opportunity will be created by the Project Activity. On the other hand, many local peoples were engaged temporarily in the project construction and increased their incoming. Also the project will provide clean energy locally and displace pollutions generated in fossil fuel fired power plants by using solar energy. In conclusion, the Validation Team is of the opinion that the project activity is in full compliance with all applicable requirements for the CDM by leading to emission reductions additional to what would have otherwise occurred, providing for reliable and measurable emission reductions with sustainable development in India through improvement of environmental condition, reduction of air pollutants. Nevertheless CAR-10 and CL-05 were raised in the context of sustainable development and successfully closed (ref Annex: Validation Protocol - Table 2).
3.8 Environmental Impacts

The project activity is a 5 MW Solar PV power plant. Referring to 132 of VVM ver 01.2 validation team based on document review /P31/, using official source i.e. EIA Notification of MoEF dated 14/09/2006 and its amendment on 01/12/2009 /B12/ and using sectoral expertise concluded that the host party i.e. India does not require prior environmental clearance for grid connected solar PV project. Hence project activity is in compliance with 131 of VVM ver 01.2 /B01/. Furthermore, a report on SEIA /P31/ has been prepared by ERM India Pvt. Ltd for the project activity. PP has clarified that this report has been prepared to meet the compliance of IFC grant and provided the copy of the report to the validation team. Validation team through review of this report concludes that there is no adverse environmental impacts form the project activity and the proposed project activity contributes to generation of renewable electricity and is expected to benefit the economic development of a backward region. Thus the project activity is expected to have only beneficial impacts on the environment. Nevertheless, CAR-12 and CL-07 were raised in the context of environmental impacts and successfully closed (ref Annex: Validation Protocol - Table 2).
3.9 Local Stakeholder Consultation

A Local Stakeholders meeting was carried out by the project proponent on 24/06/2009 which was prior to the publication of PDD on the UNFCCC website (19/03/2010 to 17/04/2010). The validation team noted that all the relevant stakeholders were identified are in line with the definition of stakeholders as per latest version of CDM Glossary of terms /B05/. The local stakeholders identified by the PP were the members of District Advisory committee on Renewable energy,
Validation Report
01 997 9105057438
representatives Local gram panchayat, Local people and representatives of Tamil Nadu electricity board, etc. who were affected by the project. The PP has utilized appropriate media to invite these stakeholders; published public notices in leading news papers on 17/06/2009 /P14-1/. Stakeholders were directly asked to comment on the project through in an open meeting conducted on 24/06/2009 among local stakeholders. A summary of the comments received and a note on how due account was taken of the concerns raised in the above public consultation are included in section E of the PDD. This also states that appropriate immediate responses were provided to them. From the background of the stakeholders, it was reasonably believed that the general attitude of the local residents, who were likely to be affected by the project, was positive towards the project and same has been verified from the onsite visit interviews with the local stakeholders. Validation team reviewed all relevant information of local stakeholder consultation meeting /P14/ and confirms that the LSC meeting meets to the requirement of 127 of VVM, ver 01.2 /B01/. The validation team confirms that the process for conducting the local stakeholders meeting is adequate and credible. During the on site visit, representatives from the local community were interviewed. In general, the interviewees showed adequate understanding of the nature of the project and felt that there would be no adverse impacts on the environment arising from the project activity. The interviewees also considered that the local economy would be benefitted from the project activity. However, the web hosted PDD /P01/ did not mention about the process through which the project has been explained to the stakeholders and also it was not clear that who represents SIIPL in the meeting dated 24/06/2009. In this context CAR-11 and CL-06 has been raised and closed after appropriate justification and revision in the PDD. (ref Annex: Validation Protocol Table 2).
3.10 Comments by Parties, Stakeholders and NGOs

The PDD version 01 of 19/03/2010 was made publicly available on ( http://cdm.unfccc.int/Projects/Validation/DB/QV6QJ0ZVTVJY7Y68H6G0VKO6J0E1W6/view.html ) from 19/03/2010 to 17/04/2010in order to invite comments from public stakeholders. No public comments have been received during this period.
Version No.:04
Page 45
Validation Report
01 997 9105057438
Appendix A
CDM VALIDATION PROTOCOL
5 MW Solar PV Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu in India
REPORT NO. 01 997 9105057438
Version No.: 04
Page 46
Validation Report
01 997 9105057438
Table 1: Validation requirements

(based on 37 of the CDM Modalities and Procedures and on CDM Validation and Verification Manual, Annex 2 of EB55) Checklist question 1. Approval 1.1 Have Letters of Approval have been provided from all involved Parties? If yes, indicate: when and by which Party the LoA has been issued, with a clear reference to the LoA itself and any supporting documentation; whether the LoA was provided to the DOE by the project participants or directly by the DNA; the means of validation employed to assess the authenticity of the document; and by a clear statement, that the DOE considers the LoA to be valid. Ref. MoV
36
Findings, comments, references, data sources
Draft Final conclusio conclusio n n
UNFCCC CDM rules. /P03/
DR
This is a unilateral project. Yes, the party involved in the project i.e. OK India has provided the letter of approval to the project. The letter of approval dated 01st February 2010(No. 4/22/2009-CCC) has issued by the DNA directly to the PP i.e. SIIPL. No, LoA was not provided to the DOE, it has been issued to the PP and PP has submitted the same to the validation team. Validation team has checked the original letter of approval dated 01st February 2010(No. 4/22/2009-CCC) during the site visit. Validation team has no doubt on the letter of approval and consider the LoA to be valid.
36
MoV = Means of Verification, DR = Document Review, I = Interview, www = internet search.
Version No.: 04
Page 47
Validation Report
01 997 9105057438
1.2
1.3
1.4
1.5
Are all Parties, who issued the LoA, Parties to the Kyoto Protocol and is this stated in the LoA? Is every LoA from the Parties involved issued by an organisation listed as Designated National Authority (DNA) on the UNFCCC web site? Indicate the official name of the DNA and contact person name. Is the participation in the CDM project activity voluntary and is this stated in all LoAs? Indicate the source of proof. Is the LoA unconditional with respect to 1.2 to 1.4?
DR
Yes, on the LoA it is stated that the party has ratified Kyoto OK Protocol in August 2002 and is a party of Kyoto Protocol.
DR
The project is a unilateral project, hence only one party i.e. India is OK involved. The party is listed on the UNFCCC website; can be viewed on http://cdm.unfccc.int/DNA/index.html and official name of the DNA is Ministry of Environment & Forest and the contact person is Mr. Rajesh Kumar Sethi.
DR
Yes, as per the letter of approval the participation of the party is OK stated as voluntary participation.
DR
Yes, the LoA is unconditional with respect to 1.2 to 1.4.
OK
Version No.: 04
Page 48
Validation Report
01 997 9105057438
1.6
1.7
1.8
Is the title of the CDM project activity as given in the PDD identical with the title given in all LoAs and Modalities of Communication? Provide Yes/No answer, and include details into Tables 2 and 3 accordingly. If any of provided LoAs contains additional specification of the CDM project activity (PDD version number, validation report version number, amount of ER, etc.) are those specifications valid and consistent with other documents? Does the project activity involve any public funding from Annex I Parties? If yes, has Annex I Party provided a written confirmation that the use of such funding does not lead to the diversion of the official development assistance.
/P01/ /P03/
DR
Yes as per the PDD the title of the CDM project is 5 MW Solar PV OK Power Project in Sivagangai Village, Sivaganga District, Tamil Nadu and identical with the LoA and MOC, the same has been checked and verified.
/P01/ /P03/
DR
No, the LoA does not contain any additional specification of the OK CDM project activity.
/P01/
DR
As per the section A.4.4 and annex 1 of the PDD there is no public CL-01 funding from the annex 1 party for the project activity. Nevertheless validation team has raised CL-01 to submit the supporting document to demonstrate that no ODA fund from the annex 1 party has been used for the project activity. Subjected to closure of CL -01.
OK
Version No.: 04
Page 49
Validation Report
01 997 9105057438
2. 2.1
Participation (VVM E.2) PDD(A.3, Are the Parties and Annex 1) project participants /P03/ (PP) listed in the section A.3 of the PDD correctly and is this information consistent with the contact details provided in Annex 1 of the PDD? UNFCCC CDM 2.2 Has every Party rules. involved approved the PDD(A.3, participation of each corresponding PP, either by Annex 1) /P03/ means of a LoA or by a separate written document? Indicate Yes / No answer and describe all inconsistencies in the Tables 2 and 3 accordingly. 3. Project Design Document (VVM E.3) /P01/ 3.1 Is the PDD presented for validation based on /B05/ the latest template available at the UNFCCC website? Indicate Yes / No answer and describe all inconsistencies in the Tables 2 and 3 accordingly.
DR
Yes, PP has provided the name of the project participant in the CL-17 PDD and consistent throughout the PDD and also it is consistent to the information provided in the Annex 1 of the PDD. However validation team noted that the name of the PP in the submitted LoA is M/s Sapphire Industrial Infrastructures Private Limited. In this context CL-17 has been raised. It is confirmed that the name of host party mentioned in section A.3 of the PDD is correct.
OK
DR
The project is a unilateral project and no annex 1 party is involved. OK Yes, the party involved in the project activity as mention in section A.4.3 of the PDD approved the participation of the PP by means of LoA.
DR
Yes, PP has used the latest available version of PDD template OK available on the UNFCCC website. This has been checked by the validation team by referring to the following website. http://cdm.unfccc.int/Reference/ PDDs_Forms/PDDs/index.html
Version No.: 04
Page 50
Validation Report
01 997 9105057438
/P01/ Has the PDD been /B05/ established in accordance with the CDM requirements for completing PDDs issued by the CDM EB? 4. Project Description (VVM E.4) 4.1 Does the PDD contain /P01/ /P12/ a description, which /P13/ provides the reader with a clear understanding of the precise nature of the project activity and the technical aspects of its implementation? Is the description (incl. any process flowcharts, Spreadsheets etc.) complete, coherent and consistent with the provisions of the monitoring plan? /P01/ 4.2 In the case of /P12/ Greenfield project activity, is the project /P13/ /P17/ design described sufficiently by means /P21/ of specifications, drawings and manuals? Provide Yes/No answer and indicate 3.2
DR
No, the PDD has not been established in accordance with the CAR 01 OK requirements for completing Small scale PDD. Hence CAR-01 and CAR 08(01) CAR-08(01) is raised (see Table 2 for details).
DR
The description in the PDD is complete, coherent and consistent CL-09 with the provisions of the monitoring plan. The PDD contain information in section A.2 and section A.4.2, which provides the reader with a clear understanding of the project activity and the technical aspects of its implementation, however in section A.2 of the PDD, statement on electricity generation from the project is misleading and not clear, in this context CL-09 has been raised.
OK
DR I
Yes, the project activity is a green field project and the PP has CL 02 given design specifications of the key equipments in the PDD CAR-27 along with technical description. The detailed specifications CAR-13 separately in the furnished document /P12/ has also been provided in the PDD. Nevertheless during document review (Cp service agreement appendix F) it was found that according to this agreement, the switchyard will be install and commission capable of 10 MWp(AC)
OK
Version No.: 04
Page 51
Validation Report
01 997 9105057438
the documents which have been reviewed in relation to the issue.
to allow for potential future expansion beyond the array capacity of 5 MWp(dc) and in this context validation team has raised CL-02 . CAR-27 has been raised to address the Wp composition (a combination of different capacity modules being implemented instead of 78Wp) of modules as verified form the site visit.CAR-13 has been raised to include the number of SPV modules installed. No, the PDD fails to demonstrate that how environmentally safe CAR 01(2) and sound technology has been implemented by the project activity CAR-01(2) has been raised in this regard.
4.3
4.4
Does the project activity reflects current good practices, uses state of the art technology or would the technology result in a significantly better performance, than any commonly used technologies in the host country? Provide the description of how validation has been carried out and what comparisons have been made. In cases where the project activity involves the alteration of an existing installation or process, does the PDD provide a clear description of the differences between the project and the
PDD(A.4.2)
DR
OK
/P01/ /P12/ /P13/ /P16/ /P17/ /P18/ /P21/ /P30/
DR, I
Not, applicable since the project activity is a Greenfield project.
OK
Version No.: 04
Page 52
Validation Report
01 997 9105057438
pre-project scenario? Please, provide Yes/Now answer and update Tables 2 and 3 accordingly, if there is anything unclear in the provided description. 5. Baseline and Monitoring methodology 5.1 General requirements /P01/ DR 5.1.1 Is the methodology /B02/ used in the project UNFCCC activity approved by Website the CDM EB and is the selected version still valid?
Yes, PP has used small scale methodology AMS I.D., which is CAR-28 approved by the CDM EB and version 15 of the methodology is still valid and is the latest version. Since the Request for Registration under the applied version of methodology i.e. version 15 and requests for registration can only be submitted until 10 Feb 2011 23:59:59 GMT using this version of the meth, PP is requested to revise the methodology version and the PDD accordingly. CAR-28 is raised in this regard. Yes, the rated capacity of the project activity is 5 MW i.e. below 15 MW, hence the project activity qualify under the criteria for smallscale CDM project activities and the PP in section B.2 of the PDD OK described the same. The validation team through document review has checked the capacity. The capacity has been verified from the Detailed Project Report, Service agreement and supply agreement. Furthermore the calculated emission reduction is not varying over time.
OK
5.2 Applicability of the selected methodology DR, /P01/ 5.2.1 Does the project I /P12/ activity qualify under the criteria for small-scale CDM /P13/ project activities set out in 28 of Decision 1/CMP.2 (Further guidance relating to the clean development mechanism)? Please provide Yes/No response and description of how this was validated. In case of calculated emission reductions varying over time, SSC-applicability limits must be met for every single year in any of the
Version No.: 04
Page 53
Validation Report
01 997 9105057438
max. 3 subsequent crediting periods. 5.2.1.2 If yes, does the PDD extensively demonstrates and confirms that the smallscale project activity is not a debundled component of a larger project? Please indicate Yes/No answer. In case of positive conclusion provide details of the validation measures taken and data found during the procedure. Otherwise amend the Tables 2 and 3 accordingly. 5.2.2 Are all applicability conditions of the selected baseline and monitoring methodology and all tools involved satisfied by the project activity? Please indicate Yes/No answer. In case of positive conclusion provide details of the validation measures. Otherwise amend the Tables 2 and 3 accordingly.
UNFCCC website /P01/
DR
Yes, the PDD extensively demonstrates and confirms that the OK small-scale project activity is not a debundled component of a larger project in section A.4.5. Validation team based on interview and background investigation through web research of the CDM EB website concludes that PP has not applied for any project activity with the same category and technology /measure to the CDM EB. Furthermore the project is meeting to all requirements as per Appendix C of the simplified Modalities and procedures for small scale CDM project activities.
/P01/ /P12/ /P13/ /P17/ /P18/ /P21/ /P30/
DR
Yes, all applicability conditions of the selected baseline and CAR 26 monitoring methodology and all tools involved satisfied by the project activity and the PP has demonstrated the same in section B.2 of the PDD. The validation team has checked the justification for all the applicability criteria as described in the section B.2 of the PDD. Nevertheless Section B.2 of the PDD fails to demonstrate the applicability of the project activity with the applicability conditions in the AMS-I.D, version 15 for foot 1 and 2 and in this context CAR-26 has been raised.
OK
Version No.: 04
Page 54
Validation Report
01 997 9105057438
5.2.3 Is the selection of the applied baseline and monitoring methodology justified? 5.2.4 Is the selected methodology correctly quoted in all related documents? 5.2.5 Does the PDD sufficiently describe all the GHG emission sources or sinks occurring as a result of project activity, which have not been accounted for under the selected methodology and are expected to contribute more than 1% of the overall expected average annual emission reductions? Provide Yes/No answer. Indicate the sources or sinks of GHG, which were proved to be negligible. Otherwise amend the Tables 2 and 3 accordingly. 5.3 Project boundary
UNFCCC website, PDD UNFCCC website, PDD PDD(B.3) /B02/ /B05/
DR
Yes, the selection of the applied baseline and monitoring OK methodology has been appropriately justified in the section B.2 of the PDD. Yes, the selected methodology has been correctly quoted in all OK related documents.
DR
DR
This section is not applicable for small-scale project as per PDD OK filling guidelines and the applied methodology.
Version No.: 04
Page 55
Validation Report
01 997 9105057438
5.3.1 Does the PDD correctly describe the project boundary? Provide Yes/No answer. And amend the Tables 2 and 3, if needed. 5.3.2 Does the PDD correctly indicate and describe the emission sources and sinks of GHG gases that are included in the project boundary? 5.3.3 In cases where the methodology allows project participants to choose whether a source or gas is to be included in the project boundary, is the choice explained and justified by PPs? 5.4 Baseline identification 5.4.1 Has the procedure contained in the selected methodology to identify the most reasonable baseline scenario been applied correctly and documented in the PDD?
PDD(B.3), /P12/ /P13/ /P17/ /P21/
DR
No, the PDD does not describe the project boundary correctly. CAR 02 Validation team has raised CAR-02 in this context.
OK
/P01/ /B02/ /B05/
DR
/P01/ /B02/ /B05/
DR
/P01/ /B02/
DR
Yes the procedure contained in paragraph 10 of the applied OK methodology has been correctly applied and documented in section B.4 of the PDD.
Version No.: 04
Page 56
Validation Report
01 997 9105057438
5.4.1.1 Is the identified baseline scenario plausible? 5.4.1.2 Are all assumptions stated in a transparent and conservative manner? 5.4.2 Does the selected methodology require the use of tools and does PDD reflects that correctly? 5.4.2.1 Were all the tools applied correctly?
/P01/ /B02/ /P01/
DR
The identified baseline scenario in section B.4 of the PDD is OK plausible. Yes all assumptions stated in the PDD have been presented in a OK transparent and conservative manner.
DR
/P01/ /B02/ /B03/ /B06/ /P01/ /B02/ /B03/ /B06/ /B02/
DR
Yes, the selected methodology requires the use of tool of to CAR 03 calculate the emission factor. The tool has not been correctly quoted the PDD and in this context CAR-03 has been raised.
OK
DR
As referred above the tool to calculate emission factor has not CAR 03 been applied correctly. CAR-03 has been raised in this context.
OK
5.4.3 In case the methodology requires several alternative scenarios to be considered in the identification of the most reasonable baseline scenario, have all scenarios been considered and have no reasonable alternative scenario been excluded? 5.4.3.1 Has the choice of the baseline scenario been done using conservative assumptions?
DR
The applied methodology (AMS I.D, Version 15) does not require OK identification of alternative scenarios to identify the most reasonable baseline scenario.
/P01/ /B02/
DR
Yes the choice of the baseline scenario been done in a OK transparent and conservative manner.
Version No.: 04
Page 57
Validation Report
01 997 9105057438
/P01/ DR Yes the identified baseline scenario is reasonable according to the CL-03 5.4.4 Is the identified /B02/ assumptions, calculations and rationales used in the PDD and baseline scenario /B06/ other reference sources. Nevertheless the quoted reference for reasonable according the Plant Load Factor in section B.6.3 of the PDD differs from the to the assumptions, one mentioned in section B.5 of the PDD, in this context CL-03 calculations and has been raised. rationales used in the PDD and other reference sources? DR No, the PDD does not describe the treatment of national and CAR 04 UNFCCC 5.4.5 Does the PDD sectoral policies as per EB 22 annex 3, CAR-04 has been raised Website describe how the in this context. /P01/ national and sectoral policies relevant to the baseline scenario have been identified and considered in the PDD? 5.4.6 Does the PDD provide Section B.4 of DR Yes, the PDD provide a verifiable description of the identified OK baseline scenario as per the 10 of the applied baseline and a verifiable description PDD monitoring methodology AMS- ID version 15 in section B.4 of the of the identified PDD. baseline scenario, including a description of the technology that would be employed and/or the activities that would take place in the absence of the project activity? 5.5 Algorithm and/or formulae used to determine emission reductions
OK
OK
Version No.: 04
Page 58
Validation Report
01 997 9105057438
5.5.1
a).Are all calculations applied and documented according to the selected methodology and in a complete and transparent manner? 5.5.1 b) Are correct units applied and consistency between parameter dimensions and parameter value ensured? See also Question 4.1 with respect to consistency of parameter values between calculation spreadsheets and PDD. 5.5.2 In case the methodology allows a selection between different options for equations or parameters, has adequate justification been given and have the correct equations and parameters been used, in accordance with the methodology selected? 5.5.3 In case some data and parameters will
/P01/, /B02/
DR
No, PP has not correctly presented all formulas given in the CAR 05(01) OK applied methodology in the PDD and the formula and symbol used CAR 05(03) for the parameters are not unified throughout the PDD. In this context CAR- 05(01) has been used. Furthermore, CAR-05(03) has been raised to correct the ER estimation in the PDD as per the realistic date of start date of crediting period.
/P01/, /B02/
DR
No the formula and symbol used for the parameters are not unified CAR 05(01) OK throughout the PDD, and in this context CAR-05(01) has been raised.
/P01/ /B02/
DR
Yes, there are some parameters which have been fixed ex-ante CAR 06 and described in section B.6.2 of the PDD. However the
OK
Version No.: 04
Page 59
Validation Report
01 997 9105057438
not be monitored throughout the crediting period, but have already been determined and fixed, are all data sources, assumptions and calculations correct, applicable to the proposed CDM project activity and conservative? 5.5.4 In case data and parameters will be monitored on implementation and hence become available only after validation of the project activity, are the estimates provided in the PDD for these data and parameters reasonable? 5.5.5 Have the major risks and uncertainties, which can influence the emission reduction estimates, been identified and addressed in the PDD? 5.6 Leakage
/B06/
description and source of these parameters have not been transparently presented in the PDD. In this context CAR-06 has been raised.
/P01/ /B02/ /B06/
DR
The reference for the net electricity supplied to the grid is not CL-03 provided transparently. In this context CL-03 has been raised. CAR 01(6) Furthermore the value of parameter Net Electricity supplied to the grid (used for the estimation purpose) has not been provided in the table of section B.7.1 of the PDD and CAR- 01(6) has been raised.
OK
/P01/ /B02/ /B06/
DR
The emission reduction for this type of project activity is equal to CL 03 baseline emission, which is the direct product of supplied CAR 03 renewable electricity (calculated) and grid emission factor. As grid emission factor is fixed for 1st crediting period and will be calculated for 2nd crediting period based on the latest data available at that time, the net electricity export is the only variable for 1st crediting period having certain degree of uncertainty as it is commercially cross checked. However, right estimation of the baseline emission is subject to closer of CL-03 and CAR-03.
OK
Version No.: 04
Page 60
Validation Report
01 997 9105057438
DR Not applicable for this project activity as this is a Greenfield project 5.6.1 Has the leakage been /P01/ /B02/ and there in no transfer of equipment (Cp 15 of the applied identified and Methodology). calculated according to the approved methodology? Same as above. 5.6.2 Have the leakage been addressed in complete, conservative and substantiated manner? 5.6.3 Are uncertainties in Same as above. the leakage emission estimates properly addressed? 6. Methodology-related issues for afforestation or reforestation CDM project activities Add specific A/R Not applicable for this CDM project activity requirements if applicable! 7. Additionality 7.1 Prior consideration of the CDM (VVM E.6.III.a) /P09/ DR Yes, PP has provided abstract of the MoM of the Board of 7.1.1 Is there documented Directors of SIIPL dated 12/08/2008. The Detailed Project Report evidence provided by is prior to this date. the project participants on how and when the decision to proceed with the project activity was taken? DR Yes the PP in section C.1.1 of the PDD has given the start date of /P01/, 7.1.2 Is the starting date of the project activity and the same is line with the definition of start /P12/, the project activity, date as per CDM glossary of term as a day when the real action of /P06/ reported in the PDD, the project begins. The validation team has checked the same and in accordance with the /P30/ this is as per the supply agreement dated 29/01/ 2010. CDM Glossary Glossary of CDM Starting date indicated in C.1. is consistent within the PDD terms and CDM VVM of terms. ,however in the emission reduction excel sheet, PP has mentioned (97)?
Version No.: 04
OK
OK
OK
OK
OK
OK
CAR-19
OK
Page 61
Validation Report
01 997 9105057438
Note: Confirm the starting date indicated in C.1. is consistent within the PDD, in particular with respect to the project implementation history. 7.1.3 Is the date stated in the provided evidence consistent with other available evidence (e.g. dates of construction, purchase orders for equipment)? 7.1.4 If the project was not published and the starting date is on or after 2nd August 2008, was it possible to receive from UNFCCC secretariat and/or DNA a written confirmation that PPs previously informed the above entities on commencement of the project activity and of their intention to seek CDM status?
the land sale deed as start date of the project activity in this context CAR-19 has been raised.
/P01/, /P12/, /P06/ /P30/ CDM Glossary of terms.
DR
Yes, the date stated in the provided evidence i.e. the supply CAR-19 agreement dated 29/01/ 2010 is same as per the section C.1.1 of the PDD. Subjected to closure of CAR-19
OK
/P01/, /P10/ /P11/
DR
Yes, the project was not published for GSC prior to start date of the project activity i.e. 29/01/ 2010 and since the starting date of the project activity is after 2nd August 2008, PP has intimated to the CDM EB and the host DNA regarding the implementation of the project activity as per EB 49 annex 22. The receipt confirmation e-mail from the CDM EB has also been provided to the validation team and the same is also reflecting on the CDM EB website and Validation team has cross checked the same by referring to CDM EB website. http://cdm.unfccc.int/Projects/PriorCDM/notifications/index_html Nevertheless CAR-18 has been raised to include the reference of intimation sent to UNFCCC and the host DNA in the PDD.
CAR-18
OK
Version No.: 04
Page 62
Validation Report
01 997 9105057438
7.1.5 For the project activities with a starting date before 2nd August 2008 and before the actual publication, was there enough evidence presented to prove that PPs were previously aware of CDM? 7.1.6 For the project activities with a starting date before 2nd August 2008 and before the actual publication, was there enough evidence presented to prove that CDM benefits have been a decisive factor in the decision to proceed with the project activity? 7.1.7 Does the individual or body that took the decision to proceed with the project activity have/had the authority to do so? 7.1.8 For the project activities with a starting date before 2nd August 2008 and before the actual
/P01/, /P15/,
DR
Not applicable as the start date of the project activity is after 2nd OK August 2008.
/P01/, /P15/.
DR
/P01/, /P15/,
DR
/P01/, /P15/,
DR
Version No.: 04
Page 63
Validation Report
01 997 9105057438
publication, was there enough evidence presented to prove that PPs were taking continuing and real actions to secure CDM status for the project in parallel with its implementation? /P01/, 7.1.9 In case there is a /P15/, significant gap between the start date of the project activity and the commencement of validation, how was it possible for the project participant to commit funds to the project in advance of receiving a positive validation opinion? 7.2 Identification of alternatives 7.2.1 Does the PDD identify /P01/, /B02/, and list credible /B04/ alternatives to the CDM project activity in order to determine the most realistic baseline scenario, unless selected approved methodology prescribes/identifies the baseline scenario and no further
DR
DR
Version No.: 04
Page 64
Validation Report
01 997 9105057438
analysis is required? 7.2.2 Does the list of alternatives include as one of the options that the project activity is undertaken without being registered as a CDM project activity? 7.2.3 Does the list contain all realistic/credible alternatives that the DOE, on the basis of its local and sectoral knowledge, considers to be viable means of supplying the outputs or services that are to be supplied by the project activity? Note: All alternatives listed in the selected methodology should be included, as well as those not covered by the methodology. 7.2.4 Is the exclusion of the alternatives for legal reasons justified? Note: Some alternatives might be illegal, according to the local regulations,
/P01/, /B02/, /B04/
DR
/P01/, /B02/, /B04/
DR
/P01/, /B02/, /B04/
DR
Version No.: 04
Page 65
Validation Report
01 997 9105057438
but still widely practiced due to lack of enforcement. It should be verified. 7.3 Investment Analysis 7.3.1 Are all sources of revenues (including savings) have been considered in the PDD and all calculations? 7.3.2 Is the type of investment analysis selected correctly in the PDD? 7.3.3 Is the selected financial indicator chosen and applied correctly?
/P01/, /P07/
DR
Yes; all possible sources of revenue has been included in the PDD and worksheet.
OK
/P01/, /P07/, /B01/, /B04/
DR
Yes, Benchmark analysis has been chosen for demonstrating CAR-14 additionality. This is in conformity with Guidance 16 of Annex 58, EB 51. However, in this context CAR -14 has been raised Yes, Project IRR has been chosen as the financial indicator to demonstrate additionality. Having regard to the fact that the project is funded by debt equity mix, project IRR is considered appropriate. The computation of project IRR conforms to the guidance given by EB vide Annex 58, EB 51. However, certain errors of principle have been noticed in the calculations. Hence, CAR -15, CAR-20, CAR-21,CAR-22, CAR-23 , CL-10, CL-11A, CL-11B and CL-14, CL-15 have been raised.
OK
/P01/, /P07/, /P11/, /P13/, /P28/, /P29/ /B01/, /B04/,/B10/, /B13/, /B14/
DR
OK CL-10, CL-11 A, B CL-14, CL-15 CAR -15, CAR-20, CAR-21, CAR-22, CAR-23 OK
7.3.4
Is the guidance on IRR calculation and assessment correctly applied? Note: Means of validation should be recorded in Table 1A. 7.3.5 In case project participants use values from Feasibility
Version No.: 04
/P01/, /P07/, /B01/, /B04/
DR
Yes, the guidance on IRR calculation has been applied correctly. CAR-15 However, it has been observed that certain issues have not been addressed correctly. Hence, CAR-15 has been raised
/P01/,/P07/, /P13/, /B01/, /B04/
DR
Input values are based on the Feasibility Study Report, which was CL -16 prepared in July 2008 and the investment decision was taken in August 2008, i.e., within 6 months. That the values were valid is
OK
Page 66
Validation Report
01 997 9105057438
Study Reports (FSR) is it possible to verify that the period between the FSR date and investment decision was reasonably short and FSR values did not change materially? 7.3.6 Are all the values consistent between FSR and PDD and are inconsistencies properly justified? 7.3.7 Were all the values from FSR applicable and valid at the time of the investment decision? 7.3.8 Is it reasonable to assume that no investment would be made at a rate of return lower than the benchmark by, for example, assessing previous investment decisions by the project participants or some verifiable circumstances that have lead to a change in the benchmark?
borne by the fact that the order placed for plant and machinery were for almost the same value. However the power tariff and the MNRE generation based incentives mentioned in the DPR and the PDD is different. Hence CL-16 is raised.
/P01/,/P07/, /P13/, /B01/, /B04/
DR
Input figures used in PDD and financial analysis are consistent CAR-07 with FSR. In this context CAR-21 and CAR -07 has been raised. CAR-21
OK
/P01/,/P07/, /P13/, /B01/, /B04/
DR
Input values are based on the Feasibility Study Report, which was prepared in July 2008 and the investment decision was taken in August 2008, i.e., within 6 months. That the values were valid is OK borne by the fact that the order placed for plant and machinery were for almost the same value. CL-13, CAR-24, CAR 25 This is a green-field project and hence, comparison of assessing previous investment decisions does not arise. However, since the project IRR with CDM benefits exceeds the benchmark, it could be assumed that the investment would not have been made at a return lower than the benchmark. However, in this context, CL-13 and CAR-24 and CAR 25 have been raised.
OK
/P01/,/P07/, /P09/, /B01/, /B04/
DR
Version No.: 04
Page 67
Validation Report
01 997 9105057438
/P01/, /P07/, DR Yes, the investment analysis prepared is in compliance with the CAR-15 7.3.9 Is the Investment /B01/, /B04/ latest version of the Guidance on the Assessment of Investment Analysis prepared in Analysis. However, in this context, CAR-15 has been raised compliance with the latest version of the Guidance on the Assessment of Investment Analysis as provided by the CDM EB? 7.4 Barrier analysis (Refer question No. 12 for SSC-CDM project activities) /P01/, DR Certain issues have been addressed in the barrier analysis which CAR-16 7.4.1 Are there any issues has a clear impact on financial viability and has been assessed addressed in the under investment analysis. Hence, CAR-16 has been raised barrier analysis that have a clear impact on the financial viability of the project activity and that shall be assessed by an investment analysis? /P01/ DR Barriers existence has been substantiated. However, since it has CAR-16 7.4.2 Do the listed barriers clear impact on financial viability and has been assessed under exist and is their investment analysis, CAR -16 has been raised existence substantiated? Note: (a) by independent sources of data such as relevant national legislation, surveys of local conditions and national or international statistics and/or (b) by interviews with relevant individuals: including members of
OK
OK
OK
Version No.: 04
Page 68
Validation Report
01 997 9105057438
industry associations, government officials or local experts if necessary? /P01/ DR Since the barrier identified by the project participant has a clear 7.4.3 Would any of the impact on financial viability and has been assessed under identified barriers investment analysis and CAR-16 has been raised, this question is prevent the not applicable implementation of the project activity but not equally prevent the implementation of the possible alternatives, in particular the implementation of the identified baseline scenario? 7.5 Common practice analysis (Refer question No. 12 for SSC-CDM project activities) 7.5.1 If the PPs claim in the /P01/, /B11/ DR Project Participant has not claimed first-of-its-kind barrier. Hence, PDD that CDM project this question is not applicable activity is the first of its kind, is it justified? /P01/, /B11/ DR Entire country has been considered as geographical boundary for 7.5.2 Are the geographical common practice analysis which conforms the guidance given boundaries for the vide VVM common practice analysis identified correctly? DR Since entire country has been considered as geographical 7.5.3 Does the PDD provide /P01/, /B11/ boundary for common practice analysis this question is not an explanation why applicable. this region was selected and deemed more appropriate and is this explanation traceable and reliable? 7.5.4 Are there similar PDD (B.5) DR As per the available information, there are only two projects in the
Version No.: 04
CAR-16
OK
OK
OK
OK
CAR-17
OK
Page 69
Validation Report
01 997 9105057438
operational project activities, other than CDM activities, widely observed and commonly carried out in the defined region? Note: Use official sources and local and industry expertise. 7.5.5 In case there are similar commercially operated project activities, other than CDM activities, already widely observed and commonly carried out in the defined region, are there essential distinctions between the CDM project activity and the other similar activities? 8. Monitoring plan 8.1 Are all parameters required by the selected approved methodology or tool identified and listed in the PDD? Note: not all methodologies indicate monitoring parameters in tabular form or by reference
country, both of which have an installed capacity much less than what the project envisages. Hence, they are not strictly comparable. Moreover, both of them have been set up in public sector. Hence, similar project activities are not commonly carried out in the country. However, CAR-17 has been raised in this context.
/P01/, /B11/
DR
As per the available information, there are only two projects in the CAR-17 country, both of which have an installed capacity much less than what the project envisages. Hence, they are not strictly comparable. Moreover, both of them have been set up in public sector. Hence, similar project activities are not commonly carried out in the country. However, CAR-17 has been raised in this context.
OK
/P01/, /B02/, /B05/
DR
The PP has included the parameter i.e. net electricity supplied by the project activity to the grid in section B.7.1 of the PDD as required by the applied meth, however the same has not been described in a transparent manner and there are some misleading and incorrect information. In this regard validation team has raised CAR- 01(4), CAR-05(2), CAR-08(3),(4).
CAR 01(4), CAR 05(2), CAR 08(3), CAR 08(4)
OK
Version No.: 04
Page 70
Validation Report
01 997 9105057438
to the variables used in formulae; Nonetheless, all parameters indicated in the methodology and applicable to the project must be listed in the PDD, emissions due to nonapplicability be justified. 8.2 Is the measurement /P01/, method clearly stated /B02/, for each value to be monitored and deemed appropriate? Does the monitoring plan record data in the original form as generated, providing QA/QC procedures to be used on the measurement method? Note 1: if the measurement unit is different from the unit to be applied in the methodology, describe the actual measurement and any according conversion method to match the unit used in the methodology. Example: liquid fuels may be monitored as weight or volume. If measured as volume, the measurement method and equipment
DR
No, PP has not mentioned the measurement method correctly and CAR 08(4), there was some misleading statement in section B.7.1 and B.7.2 CAR 09 of the PDD. In this context CAR-08(4), CAR-09 has been raised.
OK
Version No.: 04
Page 71
Validation Report
01 997 9105057438
including the according unit (e.g., liter) shall be described in B.7.1, as well as the conversion into weight units as needed. Note 2: Data on invoices / delivery slips may be used for QA/QC purposes, but do not constitute an actual means of monitoring and thus cannot be applied as a source of data. /P01/, 8.3 Are values of the ex/B02/, ante parameters / monitoring parameters /B06/, selected correctly and conservative in accordance to methodology or tools? 8.4 Is the measurement equipment for each parameter described and deemed appropriate? Is the measurement accuracy addressed and deemed appropriate? Are procedures in place on how to deal with erroneous measurements and are the corrective actions identified? /P01/, /B02/, /B05/
DR
DR
Yes PP has correctly mentioned the value of ex-ante parameter in CAR 01(4) section B.6.1 of the PDD according to the tool to calculate emission factor of an electricity system using the latest available version (5) of database published by central Electricity Authority(CEA). However the value of monitored parameter i.e. net electricity supplied by the project activity to the grid has not been provided in section B.7.1 of the PDD, in this context CAR-01(4) has been raised. Yes the measurement equipment i.e. energy meter having the OK facility to measure both import and export for the parameter Net Electricity supplied to the grid deemed appropriate.
OK
8.5
/P01/, /B02/, /B05/ /P01/, /B05/
DR
No, the measurement accuracy has not been provided in the PDD CAR 08(5) and in this context CAR-08(5) has been raised.
OK
8.6
DR
No, procedures to deal with erroneous measurements and the CAR 08(5) corrective actions have not been provided in the PDD. In this context CAR-08(5) has been raised.
OK
Version No.: 04
Page 72
Validation Report
01 997 9105057438
8.7
Is the frequency of measurement identified and deemed appropriate? 8.8 Is the monitoring plan documented according to the approved methodology and in a complete and transparent manner? 8.9 Are the sampling, measurement methods and procedures defined? Where applicable, refer to the General guidelines for sampling and surveys for small-scale CDM project activities. 8.10 Are procedures identified for maintenance of monitoring equipment and installations?
/P01/, /B02/
DR
The information provided on frequency of measurement was CAR 09 misleading in the PDD; in this context CAR-09 has been raised.
OK
/P01/, /B02/
DR
No, the monitoring plan has not been documented in a complete CAR08(03)( OK and transparent manner, in this context CAR -08(03)(04), CAR-09 04), and CL-04 has been raised. CAR09 , CL-04
/P01/, /B02/
DR
Subjected to closure of CAR-08(4), CAR-09.
CAR 08(4), CAR 09.
OK
/P01/, /B05/
DR
No, the procedures for maintenance of monitoring equipment and CAR installations are not clearly identified in the PDD. Hence CAR- 08(06) 08(6) has been raised.
OK
Version No.: 04
Page 73
Validation Report
01 997 9105057438
8.11 Are the equipment calibration intervals identified and justified?
/P01/, /B02/, /P18/, /B15/ UNFCCC Website
DR
8.12 Are procedures identified for day-today records handling (including what records to keep, storage area of records and how to process performance documentation)? 8.13 Are the monitoring arrangements described in the monitoring plan feasible within the project design? 8.14 Are the means of implementation of the monitoring plan, including the data management and quality assurance and quality control procedures, sufficient to ensure that the emission reductions
/P01/
DR
PP has mentioned the calibration intervals by referring to Energy CAR 08(7) Purchase Agreement. Validation team has checked the EPA and the EPA refer to Central Electricity Authority (Installation and Operation of Meters) Regulations, 2006 for the testing of the meters. According to Central Electricity Authority (Installation and Operation of Meters) Regulations, 2006 all interface meters shall be tested at least once in five years. This is not meeting to the requirement mentioned in General Guidelines to SSC CDM methodologies, Version 14.1. In this context CAR- 08(07) has been raised. No, the section B.7.2 of the PDD is not clear on the procedures CL-04 identified for day-to-day records handling and in this context CL-04 has been raised.
OK
OK
/P01/
DR
Yes, the monitoring arrangements described in the section B.7 of OK the PDD is feasible within the project design.
/P01/, /B02/, /P18/, /B15/ UNFCCC Website
DR
No the means of implementation of the monitoring plan including CAR 08(7) the data management is not clear from the PDD, in this context CL-04 CL-04 has been raised. The QA/QC procedure for monitoring of the emission reduction is not completely addressed as per the requirement of UNFCCC guidelines, hence CAR-08(7) and CL-04 has been raised.
OK
Version No.: 04
Page 74
Validation Report
01 997 9105057438
achieved by / resulting from the project activity can be reported ex post and verified? 8.15 Do the PPs make provisions for personnel training needs? 8.16 Is the authority and responsibility of overall project management clearly described? 8.17 Are procedures identified for emergency preparedness for cases where emergencies can cause unintended emissions? 8.18 Are procedures identified for review of reported results/data? 8.19 Is the data archiving period for this project activity stated in the PDD and appropriate? Note: All archived monitoring data, required for verification and
Version No.: 04
/P01/
DR
/P01/
DR
Yes, the PP has mentioned the provision of training in section CL-04 B.7.2 of the PDD. However, in the table of the Organizational Structure in section B.7.2 of the PDD it is not clear who will the responsible person for the training need. In this context CL-04 has been raised. No, the authority and responsibility of overall project management CL-04 has not been clearly described in section B.7 of the PDD, in this context CL-04 has been raised.
OK
OK
/P01/
DR
No, the PP has not identified the procedures for emergency CAR 08(8) preparedness for cases where emergencies can cause unintended emissions. In this context CAR-08(8) has been raised.
OK
/P01/
DR
No, the PP has not identified the procedures for review of reported CAR 08(9) results/data. In this context CAR-08(9) has been raised. No, the data archiving period for this project activity stated in the CAR 01(3) section B.7.2 of the PDD is not appropriately written as per the requirement and in this context CAR-01(3) has been raised.
OK
/P01/, /B02/, /B05/.
DR
OK
Page 75
Validation Report
01 997 9105057438
issuance, should be kept for at least two years after the end of the crediting period or the last issuance of CER. 8.2 Monitoring of the leakage 8.2.1 Does the monitoring plan provide for the collection and archiving of all relevant data necessary for determining leakage? 8.2.2 Is the choice of project leakage indicators made according to selected methodology in a reasonable and conservative manner? Note: local knowledge and sectoral expertise shall also be considered. 8.2.3 Is the measurement method clearly stated and deemed appropriate for each leakage value? 9. Sustainable development 9.1 Does the LoA from the /P03/ Host country DNA contain the confirmation that the proposed CDM project
Version No.: 04
Not applicable for this project activity as this is a Greenfield project -and there in no transfer of equipment (Cp 15 of the applied Methodology).
Same as above.
--
Same as above.
--
DR
Yes, LoA dated 01st February 2010(No. 4/22/2009-CCC) from the OK Host country DNA contain the confirmation that the proposed CDM project activity contributes to the sustainable development of the host Party.
Page 76
Validation Report
01 997 9105057438
activity contributes to the sustainable development of the host Party? /P01/, DR 9.2 If PDD indicates any /B07/ additional environmental benefits of the project, other than GHG emission reductions, were those benefits properly substantiated? 10. Stakeholders consultation and comments 10.1 Were the stakeholders /P01/, DR identified in /P14/ appropriate and complete manner? 10.2 Are the identified /P01/, DR stakeholders /P14/ plausible? 10.3 Does PDD describe the means being used to invite local stakeholders comments? 10.4 Were those means appropriate? /P01/, /P14/ DR
The view of the PP on the contribution of the project activity to CAR 10 sustainable development does not fully demonstrate sustainability CL-05 criteria as per the interim approval guidelines for CDM projects of the host country in section A.2 of PDD. Furthermore there were some misleading statements in the section A.2 of the PDD. In this context CAR-10 and CL-05 has been raised.
OK
Yes, stakeholders have been identified in an appropriate and OK complete manner. The same has been clearly presented in section E.1 of the PDD. Yes, the identified stakeholders i.e. local people, representative of OK district advisory committee of renewable energy and the representatives of local and state level statutory bodies are plausible in the context of this project activity. Yes, the PDD clearly describes the media used for the project OK activity i.e. the news paper advertisement in both local and national news paper dated 17/06/2009 and in both English(in national news paper) and in Vernacular language( in local news paper). The same is found inline and appropriate. Yes, the media used is appropriate and since both English and OK Vernacular language has been used, it was said to be appropriate means of communication and is a good way to reach the local people and representatives of statutory bodies.
/P01/, /P14/
DR
Version No.: 04
Page 77
Validation Report
01 997 9105057438
10.5 Was the project presented to the stakeholders in unbiased manner?
/P01/, /P14/
DR
10.6 If a stakeholder consultation process is required by regulations/laws in the host country, has the stakeholder consultation process been carried out in accordance with such regulations/laws? 10.7 Is a summary of the stakeholder comments provided in the PDD?
/P01/, /P14/
DR
No, the PDD is not clear on the way of presentation that was used CAR 11 to describe the project to the identified stakeholders in this context CL-06 CAR-11 has been raised. Furthermore from the document review it was also not clear that who was the representative of SIIPL presented the project to the stakeholder. In this context CL-06 has been raised. No, the stakeholders consultation process is not required by the OK regulation/laws in the India, hence this is not applicable.
OK
/P01/, /P14/
DR
/P01/, 10.8 Has due account of /P14/ any stakeholder comments been taken by PPs and reflected in the PDD? 11. Environmental impacts /P01/, 11.1 Is the documentation /P28/, supplied by the PPs /B12/ regarding environmental impacts relevant and accurately reflected in the PDD?
DR
PP has provided the MoM of the LSC meeting dated 26/06/2009 OK and the summary of the comments on the project has been provided in the section E.2 of the PDD. Stakeholders of this project activity have appreciated the implementation of the project activity. Hence this is ok. There is no negative comment raised on this project activity and OK stakeholders has appreciated the project implementation, hence no due account on any negative comment is required to be addressed and needs to be reflected in the PDD.
DR
PP has referred to the EIA Notification of MoEF dated September CAR 12 14th 2006 in Section D.1 of the PDD and concluded that no EIA is CL-07(1) required for the project activity. However the validation team through web research found that the same notification has been amended in the year 2009 and PDD does not addresses the amendment and it was not clear whether EIA is required under this amendment or not. In this context CAR-12 has been raised. Nevertheless during document review (Cp Loan Application to
OK
Version No.: 04
Page 78
Validation Report
01 997 9105057438
11.2
Is an environmental impact assessment (EIA) required for the CDM project activity? Note: determine by using a review of relevant legislation and local expertise. 11.3 In case an EIA is required, has the EIA has been approved by local authorities and is the outcome accurately reflected in the PDD? 11.4 Does the PDD include a brief description of the environmental effects of the project, including transboundary? 11.5 Are those effects properly addressed in the design of the project activity?
/P01/, /P28/, /B12/
DR
IDBI Letter dated 08/10/2009, letter reference no. SIIPL/Solar/TN Project/2008-09), it was observed that PP has enclosed a report on social and EIA conducted by ERM India, in this context CL07(1) has been raised. Subjected to closure of CAR-12 and CL-07(1). CAR 12 CL-07(1)
OK
/P01/, /P28/, /B12/
DR
Subjected to closure of CAR-12 and CL-07(1).
CAR 12 CL-07(1)
OK
/P01/, /P28/, /B12/
DR
/P01/, /P28/, /B12/
DR
PP in section D.2 of the PDD has included a brief description of CAR 12 the positive impacts of the project. However there was some CL-07(2) misleading statement in section D.2 of the PDD regarding the negative impacts of the project and in this context CL-07(2) has been raised. Subjected to closure of CAR-12 and CL-07 Subjected to closure of CAR-12 and CL-07 CAR 12 CL-07(2)
OK
OK
Version No.: 04
Page 79
Validation Report
01 997 9105057438
DR Subjected to closure of CAR-12 and CL-07(1). CAR 12 /P01/, 11.6 Does the project /P28/, comply with CL-07(1) /B12/ environmental legislation in the host country? 12. Specific validation requirements for SSC-CDM project activities DR Yes, since the capacity of the project activity is 5 MW i.e. below 12.1. Whether the project /P01/, 15 MW, hence the project activity qualify under the criteria for OK activity qualifies as a /P12/, small-scale CDM project activities and the PP in section B.2 of small-scale project /P13/, /B02/ the PDD described the same. The validation team through activity? document review has checked the capacity. The capacity has been verified from the Detailed Project Report, Service Refer question No. 5.2.1 of agreement and supply agreement. this Table. 12.2 Whether the project /P01/, activity conforms to one of /B02/ the approved small-scale categories and applies the relevant tool or methodology? Refer question No. 5.2 of this Table. 12.3 Whether the small-scale methodologies are applied in conjunction with the general guidance to the methodologies? Refer the general guidance to the Methodologies. 12.4 Is the project activity a /P01/, debundled component of UNFCCC
Version No.: 04
OK
DR
Yes please refer to question 5.2 of this table.
OK
/P01/, /B02/, UNFCCC website
DR
Yes, the small-scale methodologies are applied in conjunction OK with the general guidance to the methodologies.
DR
The project is not a debundled component of a large scale OK project, please refer to question no. 5.2 of this table.
Page 80
Validation Report
01 997 9105057438
a large scale project as website defined in Appendix C of the complified modalities and procedures for small scale CDM project activities? Refer question No. 5.2.1.1 of this Table 12.5 Whether the host /P01/, country requires the /B12/ environmental impact assessment study to be conducted for the project activity and if so whether it has been done? Refer question No. 11 of this Table 12.6 Whether the /P01/, /P07/, additionality of the project /B01/, /B04/, activity been demonstrated by one of the four barriers, viz., investment barrier, technological barrier, prevailing practices barrier and other barriers, listed in Attachment A to Appendix B of simplified modalities and procedure and Annex 34 of EB 35? Refer question No. 5.2 of this Table
DR
Subjected to closure of CAR-12.
CAR 12
OK
DR
Yes, the project is additional based on investment barrier in as OK much as the project IRR without CDM benefits is lower than the benchmark.
Version No.: 04
Page 81
Validation Report
01 997 9105057438
12.6.1 Is the project facing investment barrier and whether the methodology adopted in demonstration acceptable?
/P01/, /P07/, /P11/, /P13/, /P28/, /P29/, /B01/, /B04/, /B10/, /B13/
DR
Refer para (a) of Attachment A to Appendix B and Nonbinding best practice for SSC project activities 12.6.2 Whether the project /P01/ faces access to finance barrier and if so whether credible and reliable documents have been provided to substantiate the claim? Refer para (b) of Non-binding best practice for SSC project activities 12.6.3 Is the project facing /P01/ technological barrier and whether documentary evidence submitted to justify the same are acceptable? Whether the barrier can be quantified and estimated?
DR
CAR-06 CAR-14, CAR-15, CAR-20, CAR-21, CAR-22, CAR-23 CL-10, CL-11 A, B CL-12, CL-15 Project Proponent has not used access-to-finance barrier to OK demonstrate the additionality of the project. Hence, this question is not applicable Yes, Investment barrier has been assessed as significant in as much as the project IRR is less than the benchmark without CDM benefits. However, there were some errors in respect of which CAR-06,CAR-14, CAR-15, CAR-20, CAR-21, CAR-22, CAR-23 and CL-10, CL-11 A, CL-11 B CL-12,CL-15 have been raised
OK
DR
Project Proponent has not used technological barrier to OK demonstrate the additionality of the project. Hence, this question is not applicable
Version No.: 04
Page 82
Validation Report
01 997 9105057438
Refer para (b) of Attachment A to Appendix B and Nonbinding best practice for SSC project activities 12.6.4 Is the prevailing /P01/, /B11/ practices barrier justified, significant to prevent the implementation of the project? Are the evidences submitted credible and reliable? Refer para (c) of Attachment A to Appendix B and Nonbinding best practice for SSC project activities 12.6.5 Are other barriers /P01/, /B11/ justified and assessed as significant preventing the implementation of the project activity? Are the evidences submitted credible and reliable? Refer para (d) of Attachment A to Appendix B and Nonbinding best practice for SSC project activities
DR
As per the available information, there are only two projects in the CAR-17 country, both of which have an installed capacity much less than CL-08 what the project envisages. Hence, they are not strictly comparable. Moreover, both of them have been set up in public sector. Hence, setting up of solar power projects is not a prevailing practice in the country. However, CAR-17 and CL-08 has been raised in this context.
OK
DR
Project proponent has not used other barrier to demonstrate OK additionality. Hence, this question is not applicable.
Version No.: 04
Page 83
Validation Report
01 997 9105057438
Table 2: CL/CAR No
Resolution of Corrective Action and Clarification Requests Observations Refer ence Summary of project owner response Revised section(s)/ Annexe(s) of the PDD Validation team conclusion
CL-01
PP is requested to submit 1.8 supporting document to demonstrate that no diversion of ODA fund from the Annex I party has been used for the project activity. Furthermore, an undertaking to the effect that no CERs would be claimed by IFC in lieu of the grant given /P11/ is required to be furnished to assess the possibility of diversion of ODA (Cp section A.4.4 of the CDM-SSC-PDD completion guidelines). In the same context an undertaking (from IFC) specific to this project financing may be furnished. During document review 4.2 (Cp Service agreement Appendix F, page no. 51) following statement was found: Consultant is required to install and commission switchyard capable of
NA PP has submitted following documents: 1. An undertaking that no diversion of ODA fund from Annex-1 country. 2. An undertaking that no CERs would be claimed by IFC in lieu of grant provided to the project activity. 3. The Undertaking from IFC
Ok, PP has submitted following documents : 1. Undertaking(no ODA used) letter from SIIPL dated 03/04/2010, ref no- SIIPL/TN/03042010-2, /P22/ 2. Undertaking letter from SIIPL dated 31/05/2010, that no CERs would be claimed by IFC in lieu of the grant provided. /P22/ 3. Undertaking letter from IFC dated 23/09/2010, that no CERs would be claimed by IFC in lieu of the grant provided /P22/. By reviewing all these document and project means of finance (through DR of /P11/, /P12/, /P29/ and /P30/), validation team confirms that there is no ODA used under this PA. Further more no CERs would be claimed by IFC in lieu of the grant given /P11/. Validation team during site visit interview and document review of the SLD /P21/ noted that though in the service agreement there is a provision of expansion of switch yard to 10 MWp, but this does not corresponds to the project activity. This is confirmed form the SLD /P21/ that the transformer installed under the project
CL-02
Switchyard exists at a power generating station to coordinate the exchange of power between the generators and the transmission lines in the area. Therefore a switchyard contains; current carrying conductors, grounding wires and switches,
Version No.: 04
Page 84
Validation Report
01 997 9105057438
evacuating 10 MWp(AC) capacity to allow for potential future expansion beyond the array capacity of 5 MWp(DC). PP is requested to clarify why this provision has been made in the agreement as the capacity of the project is 5 MWp.
transformers, disconnects, breakers, metering devices etc. At present SIIPL does not have any concrete plan for expansion. In case of any capacity expansion during the crediting period of this proposed 5MW project activity, the additional (expansion) capacity would be treated as a separate project activity and generated power through this expansion would be routed through a separate switchyard with dedicated metering system. The PLF has been taken from B.6.3 detailed project report prepared by a third party contracted by PP. The same report was submitted to Bank for Loan approval. The same has been corrected in section B.6.3 of the revised PDD. The table under section B.7.2 of B.7.2 the PDD has been revised and the following context has been clearly demonstrated under this table of the revised PDD. 1. Data and parameters to be B.7.2 recorded and persons responsible for recording.
activity is of 6.3 MVA only, which can not cater the electricity generation of 10 MWp. This provision has only be made in the service agreement due to the sufficient land availability at the site as discussed with the PP during site visit. Hence this CL is closed.
CL-03
The reference for the 19% 5.4.4, PLF as mentioned in 5.5.4, section B.6.3 differs from 5.5.5 the reference as mentioned in section B.5 of the PDD. PP is requested to clarify the same. The table on page no. 21 in section B.7.2 of the PDD is not clear in the following context: 8.8, 8.12, 8.14, 8.15, 8.16
The reference for the PLF has been corrected in the section B.6.3 of the PDD. Hence CL is closed.
CL-04
The section B.7.2 has been appropriately modified, hence this CL is closed.
1. What is to be recorded by the personals mentioned in the table.
1. Required correction has been done in section B.7.2 of the PDD, hence this part of CL is closed.
Version No.: 04
Page 85
Validation Report
01 997 9105057438
2. Responsibility of the data recording and emission reduction from the project.
2. Persons responsible for data B.7.2 recording and ER calculation.
3. Calibration and training responsibility.
3. Calibration and training details.
B.7.2
4. Responsibility of review of reported results/data. CL-05 PP needs to substantiate 9.2, the employment plan for the project activity, this is required to substantiate the sentence on page no. 3 of the PDD which is As both the genders of the society will.elevating the social standards. From the document review 10.5 (MoM, Agenda note), it was observed that no representative of SIIPL was presented in the meeting. From these documents only personal from Moser Baer
4. Review of the data reported B.7.2 and responsibility of review. Even though PP is open to A.2 provide equal employment opportunities to both the genders, there is no documentary evidence as sought by DOE. Hence PP is not referring to this aspect in the revised PDD.
2. The responsibility of the data archiving lies with the site manager and supervisor, where as the responsibility of emission reduction calculation is with the General Manager, which is in turns reviewed by the CEO. Required information has been provided; hence this part of CL is closed. 3. ok, PP has provided the responsibility of maintenance of equipments, which is with the Site Manager and Site supervisor. The site manager and site supervisor will check the meters and in case of any fault in the meter, it will subjected to testing and calibration. Moreover, the responsibility of training of O & M personnel is provided in the PDD, hence this part of CL is closed. 4. Under section B.7.2, the responsibility of the review of reported data has been included, hence this part of CL is closed. The sentence has been removed from the PDD. Hence this CL is closed.
CL-06
The project activity is being NA implemented by M/s Sapphire Industrial Infrastructures Private Limited (SIIPL). SIIPL is a subsidiary of Moser Baer Clean energy Limited (MBCEL). The Stakeholder meeting was
The justification provided by the PP is convincing, as SIIPL is a subsidiary company of Moser Baer Clean Energy Limited (MBCEL). Being a subsidiary company, MBCEL can depute any person as a representative for any event to be conducted by SIIPL. Validation team
Version No.: 04
Page 86
Validation Report
01 997 9105057438
is identified, PP is requested to clarify how the project was presented to the local stakeholders in this case as the project is being implemented by SIIPL.
attended by authorized officer of the parent company. Mr. S. Sridhar, General Manager (Technical services), MBCEL and Mr. S. Periasamy, Liaison officer, MBCEL represented SIIPL and attended the meeting. Mr. S. Sridhar, representative of SIIPL explained all stakeholders about the project activity and the likely social benefits to the local populace from the proposed project in terms of employment opportunity.
CL-07
1. During document review (Cp Loan Application to IDBI Letter dated 08/10/2009, letter reference no. SIIPL/Solar/TN Project/2008-09), it was observed that PP has enclosed a report on social and EIA conducted by ERM India along with the application letter, PP is requested to clarify the context of this report as in section D.1 of the PDD it is written that project does not require EIA as per Indian regulation, furthermore PP is requested to submit the
11.1, 11.2, 11.3, 11.4, 11.5, 11.6
Though EIA is not required for D.1 the project activity, PP has conducted the Social & Environmental Impact Assessment (SEIA) for the project activity to comply with the IFC performance standards to the project activity (please refer page no 12 of SEIA report). The SEIA report is provided to DOE.
further noted that MBCEL is a corporate guarantor for the term loan sanction by the IDBI as well. The reference of the two persons provided by the PP in the response i.e. Mr. S. Sridhar, General Manager (Technical services), MBCEL and Mr. S. Periasamy, Liasion officer along with Mr. Dinesh Narang Vice President Finance SIIPL is found on all-most every critical documents including the Energy Purchase Agreement (one of the major event of the project) as well. Hence it can concluded that these two representatives are closely associated with the project, and can explain the project to the stakeholders and they are also authorised to do so. Hence CL has been closed. Validation team is in receipt of the SEIA report prepared by the ERM India Pvt. Ltd. On page no. 12 of this report under heading objective and scope of work it is written that this report has been prepared to meet the IFC performance standard only. Hence context of this report is clear to the validation team. Hence this CL has been closed.
Version No.: 04
Page 87
Validation Report
01 997 9105057438
copy of the stated report prepared by the ERM India to the validation team. 2. The sentence in section D.2 of the PDD No significant negative impacts. of project activity by the host party. is misleading and the PP is requested to substantiate the same with objective and credible documentary evidence.
The Environment (Protection) NA Rules, 1986, India imposes certain restrictions and prohibitions on new projects or on the expansion or modernization of existing projects based on their potential environmental impacts undertaken in any part of India, unless a prior environmental clearance by authorized entity 37 . As per the notification from Ministry of Environment & Forest dated September 14, 200638, the proposed project activity does not require prior environmental clearance. This implies that the host country does not consider any negative impact by implementation of the proposed project activity.
Ok, the justification provided by the PP is convincing, since no EIA is required by the host country, hence CL is closed.
CL -08
PP needs to clarify the 12.6.4 following in context with barrier due to prevailing practice: 1. The foot note 9 Page no. 14 of the PDD is not addressing the issue/context for which it has been provided.
1. The PDD has been revised as B.5 per foot note 9. The foot note 12 is referring the same context in the revised PDD.
1. Ok, footnote corrected.
37 38
http://envfor.nic.in/legis/eia/so1533.pdf http://envfor.nic.in/legis/eia/so1533.pdf
Version No.: 04
Page 88
Validation Report
01 997 9105057438
2. Page no. 14 paragraph 3 of the PDD States Though the Ministry is implementing is very nominal in the country. Furthermore, in the same paragraph it is written This is because of the high especially power generation. PP needs to clarify that how the conclusion like growth of solar PV plant is nominal irrespective of Ministrys effort has been made. Furthermore, how the conclusion that this is because of the high initial cost has been made. This is required as the provided reference i.e. foot note 12 is not clear on the above mentioned conclusions. 3. According to page no. 15 paragraph 1 of the PDD In the financial year 200708.. 2.55 million units of electricity in a year. The reference provided do not contain any year, please justify the same
2. The growth of solar energy NA utilization in India is very nominal and it has been described in the table: Growth of different grid connected power sources in India under the heading of Barrier due to prevailing practice. It is also clear from the foot note 12 that the high initial cost of solar energy systems is a barrier in large scale utilization of solar energy system, especially for power generation.
2. OK, the entire paragraph has been appropriately modified and the statement of this is ....high cost has been removed. Furthermore, the response of the PP is deemed to be correct. Hence this part of CL is closed.
3. The reference provided in the NA foot note no 15 was published on MNRE site which states that there was not any grid connected solar PV power plant in India till 31/01/2007. The reference provided in the foot note 16 was also published by MNRE on 31/03/2008 which states that 2.12 MW grid connected solar PV power project has been installed in India.
3. The justification provided by the PP is acceptable. Though the cited references (foot note 15 & 16) in the web hosted PDD does not provide any year, but based on the publication date of the reference (foot note 16- published on Monday, March 31, 2008), it can be concluded that until 31/01/2007, there was no grid connected solar power plant in India, later on in the financial year 2007-08, a total 2.12. MW grid connected solar PV power plant has been implemented in India. There was no
Page 89
Version No.: 04
Validation Report
01 997 9105057438
4. The statement on page no. 16 of the PDD It also demonstrates that the project activities the countrys largest grid interactive solar PV power plant and countrys first private sector megawatt size grid connected solar PV power plant needs to be supported by objective documentary evidences
Though the reference under foot note 16 does not contain any year but it is quite obvious from the date of publication of this reference and the reference provided in foot note 15 that 2.12 MW grid connected SPV have been installed in the financial year 2007-08. 4. Though the project activity is B.5 the countrys first private sector megawatt size grid connected solar PV power plant, PP is not referring to this aspect in the revised PDD as no supporting evidence is available in public domain.
further addition to the installed grid interactive solar PV power generation till 31/03/2009 and this has been checked from the web research39 Hence Validation team confirms that the claim made in the PDD is a valid claim. Hence, CL is closed.
4. Validation team through web-research found that the project activity is one of the first 40 grid-connected solar projects to be developed in India and one of the largest solar farms in emerging market countries, but is cannot be deemed as countrys first private sector megawatt size project. The project promoter could not able to demonstrate that this is the countrys first private sector megawatt size project and hence in absence of objective documentary evidence PP has removed the statement, which is deemed to correct. Hence CL is closed. 5. Ok, PP has removed the irrelevant information from the PDD, hence OK. CL is closed.
5. According to page no. 15 paragraph 3 of the PDD the sentence Apart from thisit is likely to be commissioned in December 2009. The reference provided for this claim do not substantiate
39 40
5. Since the particular statement B.5 referred Apart from thisit is likely to be commissioned in December 2009 is not relevant to the context. Hence the same has been removed in the revised PDD.
http://mnre.gov.in/annualreport/2008-09EN/overview.htm http://www.ifc.org/ifcext/spiwebsite1.nsf/1ca07340e47a35cd85256efb00700cee/BD4AEAC1C2D6A0A7852576BA000E2DAF
Version No.: 04
Page 90
Validation Report
01 997 9105057438
CL -09
that these plants are likely to be commissioned in December 2009, PP needs to clarify the same. Furthermore context of this sentence is also needs to clarify. 6. PP needs to clarify the region selected for the demonstration of barrier due to prevailing practice, in context with the comparison/statistics provided for Tamilnadu in section B.5 of the PDD (p16) The quantum of Tamil Nadu is at present only 0.165 MW. The region selected for the demonstration needs to clearly/explicitly mention. In case of region as entire India, the demonstration of Tamilnadu is irrelevant. PP needs to clarify the 4.1 sentence on page no. 03 of the PDD The project activity is expected to generate 8322 MWh of net electricity per annum. Please clarify whether it is expected generation from the project or net electricity supplied by the project. Moreover the net generation by the project
6. Following the Meth Panel B.5 meeting report 34, annex 10, SPV technology is considered as project technology and the national boundary i.e. India is considered as a geographical area for the demonstration of Barrier due to prevailing practice. The section B.5 of the PDD has been revised and the reference of Tamilnadu has now been removed from the PDD.
6. ok, the demonstration has now been done on country level only, the reference of Tamilnadu for demonstration of barrier due to prevailing practice has been removed from the PDD. Hence CL is closed.
The 8322 MWh is the net A.2 electricity supplied to the grid. The PDD has been revised accordingly. As per the supply agreement, the estimated annual system energy production is 7239994 KWh/year. This is the guaranteed annual average of estimated energy generation for the warranty period of 25 years.
OK, the required correction has been done.
Validation team found that the annual average of estimated electricity generation as per the supply agreement is an average guaranteed generation over a period of 25 years taking into consideration the degradation factor. Validation team further noted that since the project activity has
Page 91
Version No.: 04
Validation Report
01 997 9105057438
activity as per the supply agreement is 7239994 kWh/year. PP needs to clarify this contradiction
opted investment analysis for demonstration of additionality consideration of higher generation is more conservative and this is acceptable. CL is closed. DOE comment 1 Loan sanction letter has been furnished/ As per the loan sanction letter, repayment should commence from March 2011, while repayment is assumed from Sept., 2011. Basis for the same may be explained with evidence CL is open DOE comment 2 Interest computation has been corrected. However, the interest computation does not appear to be correct. In the first place, interest is computed based on closing balance, which is not in conformity with loan sanction letter. Secondly, no interest has been provided from September to February, which is incorrect. CL is open.
CL -10
Clarify whether the terms of 12.6, loan (interest, repayment 7.3.4, period and moratorium 12.6.1. assumed) is in conformity with IDBI Banks terms. Furnish the terms of loan sanctioned by IDBI Bank (document submitted does not include annexures)
PP Reply 1 The terms of loan considered for the financial analysis is in conformity with IDBI banks term. The Annexures of IDBI loan sanction letter has been submitted.
NA
PP Reply 2 The repayment has been taken from March 2011 as mentioned in the loan sanction letter. The revised IRR sheet is provided to DOE.
PP Reply 3 In line with the loan sanction letter the interest is computed based on the opening balance in the revised IRR calculation spread sheet. The interest from September
Version No.: 04
Conclusion Interest computation has been corrected. Interest has been computed on opening balance and interest has been provided from September to February. CL is closed.
Page 92
Validation Report
01 997 9105057438
2010 to Feb 2011 is computed in the revised IRR calculation spread sheet. The revised IRR calculation spread sheet is provided to DOE. CL -11 A. It is observed that the IFC subsidy has been deducted from the total cost, which is acceptable. However, clarify whether computing depreciation on total cost without deducting the subsidy part is in conformity with IT Act in the case of IT depreciation and AS 12 of ICAI in the case of book depreciation B. Tax computation does not seem to be correct Section B.5. seems to state that project IRR has been chosen as financial indicator because it is commonly used tool. Clarify whether the financial indicator has been chosen because of the stated reason or because it represents the overall return of the project, which is funded by a mix of debt and equity Please clarify how the CDM 7.3.3, 12.6.1 As per section 43(1) of the Income Tax Act and AS 12 of ICAI the total Cost should be reduced by the amount of Subsidy. In the revised IRR sheet the total Cost is reduced by the amount of subsidy and depreciation (both book & IT) is also being allowed on reduced amount Subsidy has been deducted from the cost while computing depreciation, which is in conformity with AS 12 of ICAI and IT Act. CL is closed.
7.3.3, 12.6.1 12.6, 7.3.3, 12.6.1
CL -12
Entire tax calculation has been corrected as per accounting principle. As the project is funded by both B.5 debt and equity, project IRR is considered an appropriate financial indicator for demonstrating the additionality of the project. The same has been corrected in the PDD.
Tax computation has been corrected and it is in conformity with IT Act. CL is closed. PDD has been revised and explains the appropriateness of the financial indicator. CL is closed.
CL -13
7.3.8,
PP Reply 1
NA
DOE comment 1
Version No.: 04
Page 93
Validation Report
01 997 9105057438
revenues were considered 12.6.8 essential to overcome the investment barrier to this project activity, in particular that the benchmark represents a rate below which the investment could not be made.
The project return without CDM revenues is below the benchmark. The PP has considered CDM revenue seriously in the implementation of the project activity and PP informed the Host Party DNA and the UNFCCC secretariat in writing of the commencement of the project activity and of their intention to seek CDM status. Registering the project activity as a CDM project expected after approval and registration, would provide additional revenue to the project activity alleviating the projects profitability and economic viability. PP Reply 2 Response: The average expected CER price i.e Euro 36.66/CER for the phase II (Post 2012) is considered in the revised IRR sheet and PDD. The price is taken from the report on State and Trends of the Carbon Market 2008 published by World bank in May 2008. Though in the recent past no transaction was taken place at a price of euro 35/CER, but analysts have modeled various scenarios for the schedule of
As compared to earlier submission, the CER price has been increased from 30 to 35 and a presentation made in 27th April, 2009 has been cited as the basis. This could not have been available to the Board at the time of decision making in 12/08/ 2008. That apart, the price stated, even in the presentation, is for 2020 and not for 2010. Finally, to the best of DOEs knowledge no transaction seems to have taken place in the recent past at 35. This seems to indicate that the investment had taken place at a return lower than the benchmark. CL is open
DOE comment 2 Comment: The report has to be read in entirety before drawing conclusions on just one table. No where the table states that it is CER price only. The report also states that CERs go at a discount of 6 8. No transaction seems to have taken place even at 25 so far, leave alone 36.66 as modified now. Using unrealistic price to respond to CAR is not acceptable. CL is open,
Version No.: 04
Page 94
Validation Report
01 997 9105057438
CER and have projected that the CER will likely trade at or above 35 in Phase II. . PP reply 3 It is evident from the report referred in earlier response that the emission reductions have been traded in the 20-25 price band since May 2007 till December 2008 in the EU ETS market. This price signal in EU ETS was encouraging for the project proponent to reduce emissions globally through climate-friendly CDM projects and generated carbon credits for sale into the EU ETS. Analyst also modelled various scenarios for the schedule of CER and has projected that the CER will likely be traded at or above 35 in Phase II though in the recent past no transaction was taken place at such higher price. Considering the past state and future trend of the carbon market PP considers euro 22/CER for IRR calculation with CDM revenue. The revised IRR calculation spread sheet is provided to DOE. CL -14 MNRE incentives are 7.3.4, available only for projects As per MNRE guideline, those NA projects are eligible for GBI which Conclusion CER price has been taken at EUR 22 which appears reasonable. CL is closed
Explanation is accepted.
Version No.: 04
Page 95
Validation Report
01 997 9105057438
commenced up-to 12.6.1 December 2009. The candidate project has not yet commenced generation. Clarify the status of this project vis-a-vis the subsidy and whether it has received any communication extending the date.
are commissioned December 2009.
by
31st
CL is closed
Though the proposed project has not yet commenced generation, PP has intimated MNRE on the completion of the project activity. On request of PP, MNRE has approved the GBI support to this project activity and extended the date till 31st October 2010 by vide letter no No-32/61/200708/PVSE. The letter has been provided to DOE. Following are the implementation status of the project activity as on date: EPC (Supply & Service Agreement) contract has been signed. Site development & civil works has been completed.
CL -15
O&M cost has been 7.3.4, provided right from first 12.6.1 year. Clarify whether the plant is not even given one year free warranty by the supplier The power tariff as per the 7.3.5 DPR (Annexure 9.2) is INR 3.15 per kWh. However the
CL -16
Considering the warranty provided by the equipment supplier on different items as per supply agreement, one year free O&M is considered for the project activity from the date of commissioning of the plant. The DPR was prepared based on the Tamil Nadu Electricity Regulatory commission tariff
O&M expenses has been provided only from the second year of operation, which is appropriate. CL is closed
Ok, the validation team concludes that the justification provided by the PP satisfies the requirement of VVM, ver 01.2, 113(b)
Page 96
Version No.: 04
Validation Report
01 997 9105057438
assumption (Financial parameter, Cp B.5 of PDD) of power tariff for investment analysis is taken as INR 4.50 per kWh. And also for MNRE generation based incentives the assumption in DPR (Annexure 9.2) i.e. INR 11.85 per kWh defers from the assumption in the PDD ((Financial parameter, Cp B.5). PP should justify the inconsistency in the assumptions. (Cp VVM 113 (b) VVM ver 01.2)
order on grid connected solar energy dated 11/07/2008. As per this tariff order the purchase rate for procurement of SPV power by distribution licensee is at INR. 3.15 per KWh. Again as per the MNRE guideline on GBI, the maximum amount of generation based incentive applicable for a project is the notional amount of INR 15/KWh minus the power purchased rate by the distribution licensee. Based on the above mentioned tariff order and MNRE guideline on GBI, PP considered INR 3.15/KWh & INR 11.85/unit as power purchase tariff by utility and MNRE incentive respectively for DPR preparation. In support of above statement, following documents are provided to DOE: TNERC tariff order dated 11/07/2008 Energy purchase agreement with TNEB The TNERC tariff order on Solar energy dated 11/07/2008 was amended on 22/09/2009 and commission fixed the tariff of INR 4.50/KWh as purchase rate of procurement of SPV power by distribution licensee. PP also entered in to a revised Energy Purchase Agreement with Tamil
as the inconsistency between the tariff rate assumed in the PDD/P02/ and DPR /P13/ is appropriately justified, furthermore, it is evident that this in-consistency does not have any impact on the investment analysis as the total tariff rate (i.e. based on sell to state utility + MNES generation based insensitive) in any case would not exceed to INR 15/ KWh. Hence CL is closed.
Version No.: 04
Page 97
Validation Report
01 997 9105057438
Nadu Electricity board at a power purchase tariff of INR 4.5/KWh. PP has considered the revised power tariff and MNRE incentive (referring the same MNRE guideline on GBI) for PDD development. The following documents are provided to DOE: Amended tariff order dated 22/09/2009. Revised Energy Purchase Agreement. In India in day to day practise PDD, related to correspondence with several Government authority, the word sections 'M/s' i.e. messrs is used generally before the name of the company. The name of the project entity is Sapphire Industrial Infrastructures Private Limited, however DNA has issued the LoA using the suffix M/s and hence the name of the PP in LoA is appearing as M/s Sapphire Industrial Infrastructures Private Limited, which is same as Sapphire Industrial Infrastructures Private Limited only. However in order to make consistency in all documents the name of PP is changed to M/s Sapphire Industrial Infrastructures Private Limited in MOC and PDD.
CL-17
The name of the PP as per 2.1 the PDD /P01/ is Sapphire Industrial Infrastructures Private Limited. However during the review of LoA /P03/ validation team found that the name of the PP as M/s Sapphire Industrial Infrastructures Private Limited Clarification is required on this in consistency.
Ok, the inconsistency has been clarified by the PP and the M/s Sapphire Industrial Infrastructures Private Limited has been all the documents i.e. PDD and MOC, is consistent with LoA. Hence CL is closed.
Version No.: 04
Page 98
Validation Report
01 997 9105057438
CAR- 01
The PDD is found incomplete or irrelevant in the following sections of the PDD as per CDM-SSCPDD completing guidelines: 1. The table below the map of Sivaganaga district is poorly legible and the context of the diagram is also not clear. 2. PP needs to explain how environmentally safe and sound technology including technology transfer is being applied in the project activity in section A.4.2 of the PDD as per the PDD filling guideline. 3. Furthermore in section B.7.2 of the PDD, paragraph 3 page no. 21 the sentence the energy generation..crediting period date, this is not clear and inline with the requirements of PDD filling guidelines, PP is requested to correct the statement inline with the requirements. 4. In the table of section B.7.1 of the PDD, PP is requested to include value of data as required by PDD filling guideline. This section
3.2, 4.3, 5.5.4, 8.1, 8.3, 8.19
1. The table below the map has A.4.1.4 been removed from the PDD. The section A.4.1.4 of the PDD has been revised as per CDMSSC-PDD guideline. 2. The same has been explained A.4.2 under section A.4.2 of the revised PDD.
1. Ok, the diagram has been removed from the PDD, hence this part of CAR is closed.
2. OK , required correction has been made, hence this part of CAR is closed.
3. The same has been revised as B.7.2 per CDM-SSC-PDD guideline.
3. OK, required correction has been done in section B.7.2 of the PDD, under heading Data collection and archiving. hence this part of CAR is closed.
4. The value of the data has been B.7.1 included in the table. The accuracy class of the main & check meter has been incorporated in the table.
4. Ok, the table in section B.7.1 of the PDD is appropriately corrected. hence this part of CAR is closed.
Version No.: 04
Page 99
Validation Report
01 997 9105057438
CAR -02
should also include accuracy of measurement Cp filling guidelines. 5. Each year should be presented in the format Year A, Year B . And not as Year A B, Year B C, .. in section B.2 and B.6.4 of the PDD Cp PDD filling guidelines. 6. In section B.8 of the PDD, PP has provided the name of the responsible person/entity who have determined the baseline for the present case and since the person/entity is same as per the annex 1 of the PDD, PP is requested to indicate the same in section B.8 of the PDD as it is required as per the PDD filling guidelines. As per the baseline and 5.3.1 monitoring methodology AMS ID version 15, project boundary includes the physical, geographical site of the renewable generation source. PP is requested to elaborate the project boundary as per the methodology including all the physical connection of the SPV plant and number and location of meters.
5. The same has been revised as B.2 & B.6.4 per CDM-SSC-PDD guideline.
Ok the required correction has been done; hence this part of CAR is closed.
6. The same has been B.8 incorporated in section B.8 of the revised PDD.
Ok the required correction has been done; hence this part of CAR is closed.
PP has elaborated the project B.3 boundary as per the methodology including all the physical connections of the plant with number and metering arrangement.
Project boundary is appropriately modified to meet the requirement of 09 of the applied baseline and monitoring methodology /B02/. Hence CAR is closed.
Version No.: 04
Page 100
Validation Report
01 997 9105057438
CAR -03
Tool to calculate the emission factor for electricity system version 2 is being used to calculate the grid emission factor for the southern grid. PP needs to transparently present each steps, options chosen and formula used in annex 3 of the PDD as per the tools. Also mention which sample group is used for calculation BM in step 5. Furthermore, PP is requested to opt three years generation weighted average of the operating margin (as required by the above mentioned tool) not simple average
5.4.2, 5.4.2.1 , 5.5.5
& OK, required correction has been done The calculation of grid emission B.4 PDD and the EF has been revised factor has been transparently Annex-3 accordingly and description of calculation presented in Annex-3 of the step and calculation is as per the applied revised PDD. Sample group has tool, hence CAR is closed. been mentioned in Step-5 of the applied tool. The weighted average of operating margin is used to determine in the revised PDD. The same has been provided in Annex-3 of the revised PDD. The annex-3 has been revised accordingly. Central Electricity Authority (CEA) (which is an official source of Ministry of Power, Government of India) have calculated baseline emission factors for various grids in India and made them publicly available i.e CO2 Baseline Database Version 5.0 as This meets the priority 2 of the foot note number 3 of the applied methodology. The same has been incorporated in the PDD.
In this context whole PDD, in particular Annex -3 should undergo revision. Moreover, the compliance of foot note 3 of AMS.I.D Ver 15 on the priority of obtaining plant emission factor from published official source ,i.e. CEA published data base is missing in the PDD.
Version No.: 04
Page 101
Validation Report
01 997 9105057438
CAR- 04
PP is requested to include 5.4.5 the national and sectoral policies relevant to the baseline scenario as per EB 22 annex 3. Furthermore, EB 53 annex 32 requires that this guidance (i.e. EB 22 annex 3) on national and sectoral policies should be applied in the determination of input values used in the investment analysis. The PDD does not satisfy these requirements.
The national and sectoral policies B.4 relevant to the baseline scenario as per EB 22 annex 3 have been mentioned in section B.4 of the revised PDD.
Ok, PP has included national and sectoral policies relevant to the baseline scenario as per EB 22 annex 3 in section B.4 of the PDD. Validation team concludes that the assumptions taken for the demonstration of additionality is the most applicable, appropriate and realistic assumptions and hence the compliance of 2 of EB 53 annex 32 is not required. Validation team further noted the following text of 27 of EB 55, The Board considered draft "Guidelines on the treatment of national and sectoral policies in the demonstration and assessment of additionality and agreed not to continue the consideration of the treatment of national and sectoral policies in the demonstration and assessment of additionality. The Board also agreed that possible impact of national and sectoral policies in the demonstration and assessment of additionality shall be assessed on a case by case basis. Taking this in to consideration validation team confirms that national and sectoral policy need not be taken into account for the demonstration of additionality for the present project case. Hence this CAR is closed. & 1. ok, the required correction has been done, hence this part of CAR) is closed. Subjected to closure of CAR-28, due to change of version of methodology from 15 to 16.
CAR -05
1. The formula and 5.5.1, denotation used in section 5.5.2, B.6.3 of the PDD differs 8.1 from the section B.6.1 of the PDD. PP is requested to unify all formula and
1. The formula and denotation B.6.1 used in the PDD have been B.6.3 corrected as per methodology AMS ID, version 15.
Version No.: 04
Page 102
Validation Report
01 997 9105057438
denotation used for the estimation of baseline, project emissions, leakage and emission reduction from the project. PP is requested to consider the formula as mentioned in the methodology AMS ID version 15 which has used for the project. 2. In section B.7.1 of the PDD the symbol of data and parameter EGy is not matching with the symbol as mentioned in section B.6.1 of the PDD, PP is requested to unify all symbols throughout the PDD as per the selected baseline and monitoring methodology. 3. PP is requested to correct the ER estimation in section A.4.3 of the PDD as per the realistic date of start date of crediting period. Furthermore PP is requested to mention a realistic start date of the crediting in section C.2.1.1 of the PDD with a firm conclusion that the start date of crediting period will not commence prior to date of registration.
2. The same has been corrected B.6.1 as per applied methodology. B.6.3
& 2. ok, the required correction has been done, hence this part of CAR is closed.
3. The ER estimation has been A.4.3 revised as per the revised C.2.1.1 realistic start date of crediting period.
& 3. ok, the required correction has been done, hence this part of CAR is closed.
Version No.: 04
Page 103
Validation Report
01 997 9105057438
CAR -06
CAR -07
CAR -08
PP is requested to correct the following in section B.6.2 of the PDD: The description of the term as mentioned in table of the section B.6.2 operational margin as this term is not used in the tool to calculate emission factor. Description mentioned in the last row of the table i.e. any comment is not clear. Furthermore, Parameter EFgrid,CM,y is missing in section B.6.2 of the PDD. PP needs to correct the value of escalation in O & M expanses in the table of section B.5 page no.12 of the PDD as it is not matching with the one mentioned in the Detailed Project Report prepared by the ITCOT and from the IRR sheet. PP is requested to include the following in section B.7 of the PDD: 1. Electronic archival of data/parameter is missing. This is required Cp PDD filling guidelines. 2. The operation and management structure should describe how
5.5.3
Following has been corrected in B.6.2 the PDD. The section B.6.2 has been corrected as per applied tool. The same has been clearly described in the revised PDD under section B.6.2. Parameter EFgrid,CM,y has been included in section B.6.2 of the PDD.
Ok, required correction has been made in section B.6.2 of the PDD, hence this CAR is closed.
7.3.6
The same has been corrected as B.5 per Detailed project report prepared by ITCOT and IRR sheet.
Ok, correction has been done in section B.5 of the PDD. Hence this CAR is closed.
3.2, 8.1, 8.2, 8.4, 8.5, 8.6, 8.8, 8.9, 8.10, 8.11,
1. Electronic archival of the data B.7 has been incorporated in section B.7 of the revised PDD. 2. The operational & B.7 management structure in order to ER monitoring is described
1. Ok, correction has been done in section B.7.2 of the PDD. Hence this part of CAR is closed. 2. Ok, the operation and management structure has now been appropriately modified in section B.7.2 of the PDD.
Version No.: 04
Page 104
Validation Report
01 997 9105057438
emission reduction will be 8.14, monitored Cp PDD filling 8.17, guidelines. Chronologically 8.18. explain the procedure from origin of data until the emission reduction calculation. 3. As per the table of section B.7.1 of the PDD it is mentioned that monthly billing records provided by the TNEB will be the source of net electricity supplied to the grid, however the PDD fails to demonstrate any cross checking document as required by paragraph 17 of the small scale methodology used for the present project.
chronologically in section B.7 of the revised PDD.
Hence this part of CAR is closed.
3. The billing process of the B.7.1 project activity is: Regarding the export energy, the Superintending Engineer, Sivagangai would forward the export unit to Deputy financial Controller (DFC), Sivagangai and DFC, Sivagangai would forward the same to DFC ( Cost and Budget ), Chennai with a copy to Chief Engineer NonConventional Energy Sources (CE-NCES), Chennai and Main Load Dispatch Centre, Chennai along with cost statement. DFC, Chennai would forward the same statement to Director Purchase, Chennai. Director Purchase, Chennai will make the payment of Export Bill to SIIPL either directly or through CE-NCES. TNEB shall provide a certificate to SIIPL with regard to the units exported every month which shall be forwarded to IREDA for Generation based incentive. The TNEB monthly certificate would be produced for cross checking the energy exported to the grid.
3. Ok, table of section B.7.1 of the PDD has been appropriately modified to comply 17 of the applied baseline and monitoring methodology. Subjected to closure of CAR-28, due to change of version of methodology from 15 to 16.
Version No.: 04
Page 105
Validation Report
01 997 9105057438
Regarding the import energy TNEB would raise monthly bill and SIIPL would pay the amount against the bill. The TNEB monthly import energy bill would be produced for cross checking the energy imported from the grid. 4. The monitoring parameter net electricity supplied to the grid is not measured parameter as the meters have the provision to measure export and import of energy separately through same meter (Cp section B.7.2 page no. 21 paragraph 02)the description of the same parameter needs to be corrected in the PDD. Furthermore the elaborated information on which the parameter net electricity supplied by the project activity to the grid is calculated needs to provided. 5. PP should clearly mention the procedure to cross check the correctness of the meter reading used for calculation of emission reduction, accuracy of the
Version No.: 04
The same has been corrected in B.7.1 section B.7.1 and B.7.2 of the B.7.2 revised PDD.
& 4. Ok, section B.7.1 and B.7.2 of the PDD has been appropriately modified. Hence this part of CAR is closed.
5. PP should clearly mention the B.7.2 procedure to cross check the correctness of the meter reading used for calculation of emission reduction, accuracy of the measurement, specification of the
5. Ok, required correction has been made, hence this part of CAR is closed.
Page 106
Validation Report
01 997 9105057438
measurement, specification of the meter to be installed as per the national guidelines (with proper reference in the PDD), backup plan in case of any error is detected in the meter reading either in section B.7.2 on in Annex 4 of the PDD. 6. The procedures for maintenance of monitoring equipment and installations should be clearly identified in the PDD. 7. In section B.7.1 of the PDD (Cp QA/QC procedure last row in the table), PP has clearly mentioned the calibration/testing intervals for the meter used by referring to Energy Purchase Agreement. Validation team has checked the EPA, which again refers to Central Electricity Authority (Installation and Operation of Meters) Regulations, 2006 for the testing of the meters. According to Central Electricity Authority (Installation and Operation of Meters) Regulations, 2006 all interface meters shall be tested at least once
Version No.: 04
meter to be installed as per the national guidelines (with proper reference in the PDD), backup plan in case of any error is detected in the meter reading either in section B.7.2 on in Annex 4 of the PDD.
The same has been explained in B.7.2 section B.7.2 of the revised PDD.
6. Ok, the procedures for maintenance of monitoring equipment have been explained in section B.7.2 of the PDD. Hence this part of CAR is closed. 7. Ok, the calibration requirement is now inline with the 17 (C) of General Guidelines to SSC CDM methodologies, version 15 /B05/. Hence this part of CAR is closed.
7. The energy meters will be B.7.1 tested or calibrated once in a year. This has been corrected in the revised PDD.
Page 107
Validation Report
01 997 9105057438
in five years. This is not meeting to the requirement (as per meter manufacturers specification or at least three years) mentioned in General Guidelines version 12 12 (C). PP need to correct the calibration requirement as per the criteria. 8. PP is requested to include the procedures for emergency preparedness for cases where emergencies can cause unintended emissions. 9. PP is requested to include the procedures for review of reported results/data in section B.7 of the PDD. In section B.7.2 of the PDD page no. 21 paragraph 2 the sentence This data..measured monthly and achieved annually is not clear as the section B.7.1 of the PDD states that electricity will be measured continuously and recorded on monthly basis, PP is requested to clarify whether the data is measured monthly or continuously and correct accordingly. It is
8. The same has been B.7.2 incorporated in section B.7.2 of the revised PDD.
8. Ok, emergency preparedness for cases where emergencies can cause unintended emissions has been discussed in section B.7.2 of the PDD. Hence, this part of CAR is closed. 9. Ok, appropriate correction has been done and hence this part of CAR is closed.
9. The same has been B.7 incorporated in section B.7 of the revised PDD.
CAR -09
8.2, 8.4, 8.7, 8.8, 8.9
The export and import energy will B.7.1 be measured continuously using B.7.2 Main & Check meters. Export & Import readings of Main & Check meters shall be taken on monthly basis by authorized officer of TNEB in the presence of PP or representative of PP. The same has been corrected in the revised PDD. TNEB would install the meters. This has been incorporated in section B.7.2 of the revised PDD.
& Ok, appropriate correction has been done and it is transparently provided in the PDD that data will be measured continuously and recorded monthly. This is also in line with requirements of 22 of AMS I D ver 16 /B02/. Furthermore responsibility of the installation of meters has now been transparently provided in section B.7 of the PDD. Hence this CAR is closed.
Version No.: 04
Page 108
Validation Report
01 997 9105057438
CAR -10
CAR- 11
CAR -12
CAR -13
also not clear that who is going to install the meters TNEB or SIIPL. PP is requested to include the correct description. The description provided in section A.2 on economic well being is not meeting the requirement of interim guidelines of the host DNA on sustainability criteria. This needs to be further elaborated. From the description provided in section E.1 of the PDD it is not clear how the project has been explained to the relevant stakeholders. The same needs to incorporated in section E.1 of the PDD. Section D.1 of the PDD refers to the EIA Notification of MoEF dated September 14th 2006, however the same has been amended in the year 2009. PP is requested to clarify whether EIA is required for the project activity under new amendments or not. The same conclusion should be provided in section D.1 of the PDD. The project description
9.2
The section A.2 on economic well A.2 being has been further elaborated as per guideline of host party DNA.
According to the host DNA requirements The CDM project activity should bring in additional investment consistent with the needs of the people. PP has appropriately modified the write-up to meet this requirement and hence this CAR is closed. PDD has been appropriately modified in the response of this CAR, hence CAR is closed.
10.5
The same has been explained in E.1 section E.1 of the revised PDD.
11.1, 11.2, 11.3, 11.4, 11.5, 11.6, 12.5.
As per amendment of EIA D.1 notification dated 01/12/2009, the project activity does not require EIA. The same has been incorporated in the revised PDD.
Ok, validation team has checked that no EIA is required by the host party for the implementation of the project activity. This has been checked by referring to EIA Notification of MoEF dated 14/09/2006 and its amendment dated 01/12/2009. Section D.1 has been appropriately changed and hence this CAR is closed.
4.2
The number of modules and its B.5
PDD has been revised accordingly and
Version No.: 04
Page 109
Validation Report
01 997 9105057438
does not mention the numbers with capacity of SPV modules. It broadly state the final capacity, PP is requested to update the PDD in this context.
Wp capacity is now clearly provided in section A.4.2 of the revised PDD. The total installed capacity of the SPV modules is 5.009616 MWp (DC power), which is specified by the manufacturer at testing conditions of 1000 W/m2 & 25 deg C or 600 W/m2 & 35 deg C inline with footnote 7 of general guidance version 16. However the capacity of the power plant on the basis of inverter output is 5 MW(AC power) only as there is 10 number of PCU 500 kW inverters are installed at the plant site. Hence according to the supplier declaration the capacity of the power plant is 5 MW which is in line with the requirements of 4(a) of general guidance version 16.
CAR -14
Sec. B.5. should contain an 7.3.2
The same has been explained as B.5
the number of individual capacity SPV modules has been clearly presented in the PDD. The same has been verified from the declaration provided by the supplier /P34/ on the number and capacity of the modules installed at the plant site. Validation team after review of document submitted by PP on these installations /P34/ noted that total 2934 pieces of 76 W (P)module, 3618 pieces of 78W (P)modules, 11070 pieces of 80W (P)modules, 14238 pieces of 82 W (P)modules , 28224 pieces of 84W (P)modules and 936 pieces of 86W (P)modules has been installed at the plant site and the total installed capacity of the modules based on this comes to 5.009616 MWp. This is as per manufacturer specification at testing conditions of 1000 W/m2 & 25 deg C or 600 W/m2 & 35 deg C inline with foot note 7 of general guidance version 16. Validation team further verified the output capacity of the power plant as 5 MW, as specified by the supplier (on the basis of manufacturer specification /P12/) /P34/ based on the inverter capacity of 5000 kW (10 nos of 500 kW each) installed at the plant site. This is inline with the requirements of 4(a) of general guidance version 16). The capacity of the SPV power plant is also confirmed from the commissioning certificate /P33/ and verified to be 5 MW. The same now been clearly described in the PDD and hence the CAR is closed. PDD has been suitably revised.
Page 110
Version No.: 04
Validation Report
01 997 9105057438
CAR -15
explanation as to how the selected investment analysis (benchmark analysis in this case) is in conformity with guidance 16 of Annex 58, EB 51. The section should also explain how the selected benchmark conforms to Guidance 12 and 13 of Annex 58, EB 51 Section B.5. should also contain an explanation on the following: a) The period for which the projections have been made and the basis thereof;
12.6.1
per 16, 12 & 13 of Annex 58, EB51 in section B.5 of the revised PDD.
CAR is closed
7.3.3, 7.3.4, 7.3.9, 12.6.1.
b) Salvage value considered in the terminal year and its conformity to guidance 4 of Annex 58, EB 51
a) Financial of the project has B.5 been assessed for a period of 25 years as Solar PV modules are having a useful life span of 25 years. The life time of the PV modules & the solar power plant can be referred from DPR (Page number-XI), service agreement (page no-51) & warranty period as per supply agreement (-19, under the heading of Design summary sheet). The same has been incorporated in revised PDD. b) Following guidance 4 of Annex B.5 58, EB 51 the fair value of the assets at the end of the assessment period is calculated in accordance with local accounting regulations. The fair value includes both the book value of the asset (considering
a) PDD has been modified and includes the period of projections; CAR is closed
b) PDD has been revised and includes the salvage value considered and its conformity to guidance 4 of annex 58, EB 51 CAR is closed
Version No.: 04
Page 111
Validation Report
01 997 9105057438
book depreciation as per companys law 1956) and the reasonable expectation of the potential profit on the realization of the assets. The profit on the realization of the assets is assumed to be zero as the endof-life salvage value of the PV plant components is assumed to equal the costs of dismantling and disposal of solar power plant and modules. As per guidance 4 of Annex 58, EB 51 the fair value of the project activity assets at the end of the assessment period is included as a cash inflow in the final year. The same has been explained in the revised PDD under section B.5. C) Conformity of tariff assumed to the concerns expresses by EB vide paragraph 48 of EB 49th meeting; d) The period up-to which the MNRE subsidy has been considered and the basis there for; and e) Reason for not considering accelerated depreciation though the project is entitled to (for the C) The same has been B.5 incorporated in section B.5 of the revised PDD. c) PDD has been suitably modified and addresses the concern expressed by EB on tariff CAR is closed d) PDD has been modified and the explanation on MNRE subsidy has been added. CAR is closed e) Revised PDD contains an explanation on not considering accelerated depreciation CAR is closed
d) The same has been B.5 incorporated in section B.5 of the revised PDD. The same has been incorporated B.5 in section B.5 of the revised PDD.
Version No.: 04
Page 112
Validation Report
01 997 9105057438
CAR -16
sake of transparency) High cost of the project cannot be construed as barrier as this factor has already been taken care of by investment and sensitivity analyses. (Cp 7 of EB 50 Annex 13)
7.4.1, 7.4.2, 7.4.3, 12.6.1
Since high cost of the project B.5 activity has been considered under investment analysis hence PP is not referring to the same aspect under Barrier due to prevailing practice of the revised PDD. The Barrier due to prevailing B.5 practice has been revised as per EB 50 Annex 13.
Barrier analysis has been modified and high investment cost has been removed CAR is closed
CAR- 17
CAR- 18
Further to the CAR 16 7.5.4, above, since it is a small 7.5.5. scale project activity. Demonstration / conclusion on common practices analysis is not necessary. In this context relevant guidelines content in EB 50 Annex 13 can be referred. Serious consideration 7.1.4 discussion should also include the date on which UNFCCC and DNA were informed and the relevant website address may be given as footnote. Furthermore, the table of major milestone of the project implementation can be provided in the beginning of section B.5 of the PDD, for more clarity on project implementation. The land sale (rather 7.1.2, purchase) date does not 7.1.3.
Common practice analysis has been revised as per Annex 13 of EB 50, which is acceptable CAR is closed
The UNFCCC web-link has been B.5 incorporated in the revised PDD. The description of major events of project implementation have been provided the beginning of section B.5 of the PDD.
Serious consideration paragraph has been suitably modified and provides UNFCCC intimation date and web-link. Furthermore, the description of major milestone of the project implementation has been provided in section B.5 of the PDD and deemed correct. Inline with the submitted documents. CAR is closed
CAR -19
The date of EPC contract signed NA was considered as start date of
Start date of the project has been modified and it now conforms to Glossary of CDM
Version No.: 04
Page 113
Validation Report
01 997 9105057438
CAR- 20
CAR -21
CAR -22
seem to conform to the definition of start date as per Glossary of CDM terms read with paragraph 67 of the minutes of EB 41st meeting. Based on delivery schedule as enshrined in the Supply Agreement, the project could commence operation only in Sept. 2010. In the above background assuming full year generation and hence revenue and cost do not seem to be appropriate As per the Supply Agreement, the last delivery (Transformer) is June 2010. As per the Service Agreement the project should commence within 10 weeks from the receipt of transformer at site. Hence, the expected COD should be September 15th. In the above background, providing interest from April 2010 onwards does not appear to be correct It is observed that the cost of plant and machinery including structural and civil works is only INR8783 lakhs, while the project cost assumes INR8996 lakhs. In
the project activity. The SD in the ER sheet as land sale date was an error and has been removed from the IRR spread sheet.
terms CAR is closed
7.3.4, 12.6.1.
As per service agreement the commissioning and complete handover date of the power plant is 31/08/2010 and 1st September 2010 is considered as the commercial operation date of the project activity. PDD & IRR has been revised accordingly.
Projections have been modified and the revised presentation conforms to expected commercial operation date (COD). CAR is closed
7.3.4, 12.6.
As per service agreement the commissioning and complete handover date of the power plant is 31/08/2010 and 1st September 2010 is considered as the commercial operation date of the project activity. PDD & IRR sheet has been revised accordingly.
Interest calculation has been revised. CAR is closed
7.3.4, 12.6.1
The total project cost includes cost of supply, cost of services, land cost, upfront financing fee and IDC. The cost of supply involves the cost of all equipments & machineries
Project cost has been appropriately. CAR is closed
revised
Version No.: 04
Page 114
Validation Report
01 997 9105057438
this context it is pertinent to note that CERC has estimated the cost of Solar power project at INR1700 lakhs per MW for 2009. As against this, the cost of candidate project works out to almost INR2000 lakhs per MW though the project was crystallized a year before. In the above background, the project seems to have been overestimated by the DPR.
including structural and supplies for civil works. The cost of services includes cost of service required for design, engineering, erection, construction, installation, testing, commissioning and remedy of defects in connection and related to the project activity. The cost of supply and services is considered as per supply and service agreement. The land cost is taken from the land sale deed and the financing fee is as per loan sanction letter. Apart from this the IDC part is treated as a part of the total investment cost and it is taken as per detailed project report. Considering all the above components the total project cost is INR 9678.84 lacs. The PDD and the spread sheet is revised considering project cost of INR 9678.84lacs. PP Response 1 The investment made in the financial year 2009-10 has been accounted in the year 2009-10 in the revised IRR sheet. DOE comment 1 Cash out-flow has been split. However, the investment reported to have been made in 2008-09 should be evidenced by a CA certificate providing the details of name of the beneficiary, cheque No., date of the cheque and amount CAR is open
CAR -23
Entire investment is 7.3.4, accounted in 2009-10, 12.6.1 which does not seem to be correct as per Supply and Service Agreements. Investment made in 200910 alone should be accounted for in 2009-10 and the balance investment should be accounted for in
Version No.: 04
Page 115
Validation Report
01 997 9105057438
2010-11 and netted out with cash inflow during that year. PP Response 2 Since the proposed project activity is the only business for the PP, hence the balance sheet for the FY 2009-10 is provided to DOE as a proof for the investment made in the FY 200910. PP Response 3 The signed copy of balance sheet is attached. The same has been revised. C.2.1.1 DOE comment 2 Accepted. The signed copy should be submitted. CAR is open for signed copy
Conclusion Signed copy of AR has been submitted. CAR is closed CER crediting period has been modified CAR is closed
CAR- 24
CAR- 25
Assuming CER generation 7.3.8, from April 1, 2010 does not 12.6.1 appear to be realistic. It not only contradicts the commencement date of crediting given in Sec. C.2.1.1, but also the project is not expected to commence generation before Sept. 2010. Moreover April 1, 2010 is already over. The source cited as 7.3.8 reference for CER price of EUR 30/CER gives expectation in 2020 and not 2010. In the recent past, CER price never reached anywhere near EUR 30.
PP response 1 The Expected date of registration of the project activity is 01/10/2010 and the project would start generate carbon credits from 01/10/2010. Taking into consideration of the verification cycle and the CER trading cycle
DOE comment 1 A careful scrutiny of the reference would reveal that it was released in April 2009, much after the investment decision was taken. Hence, this document could not have been available at the time of decision making. Citing this document, therefore, does not appear to be appropriate.
Version No.: 04
Page 116
Validation Report
01 997 9105057438
the generated CER from the project activity can be traded in post 2012. The cited reference forecasts the CER price in the range of Euro20 to Euro 40 in post 2012. This is the expected price of CER considering supply shortfall and increasing demand. Furthermore emergence of local carbon policy reduces the supply. Hence PP has considered Euro 35/CER in the analysis PP Response 2 The average expected CER price i.e Euro 36.66/CER for the phase II (Post 2012) is considered in the revised IRR sheet and PDD. The price is taken from the report on State and Trends of the Carbon Market 2008 published by World bank in May 2008. Though in the recent past no transaction was taken place at a price of euro 35/CER, but analysts have modeled various scenarios for the schedule of CER and have projected that the CER will likely trade at or above 35 in Phase II.
Moreover, the price assumed is 35 and not even 30 which is the price projected for 2020 and not 2012. DOE has not come across any transaction concluded at 35 in the recent past. Explanation is not convincing. CAR is open
DOE Comment 2 The report has to be read in entirety before drawing conclusions on just one table. No where the table states that it is CER price only. The report also states that CERs go at a discount of 6 8. No transaction has taken place even at 25 so far, leave alone 36.66 as modified now. Using unrealistic price to respond to the CAR is not acceptable. CAR is open
PP response 3
Conclusion
Version No.: 04
Page 117
Validation Report
01 997 9105057438
It is evident from the report referred in earlier response that the emission reductions have been traded in the 20-25 price band since May 2007 till December 2008 in the EU ETS market. This price signal in EU ETS was encouraging for the project proponent to reduce emissions globally through climate-friendly CDM projects in developing countries and generated carbon credits for sale into the EU ETS. Analyst also modeled various scenarios for the schedule of CER and has projected that the CER will likely be traded at or above 35 in Phase II though in the recent past no transaction was taken place at such higher price. Considering the past state and future trend of the carbon market PP considers Euro 22/CER for IRR calculation with CDM revenue. The revised IRR calculation spread sheet is provided to DOE. CAR -26 Section B.2 of the PDD fails 5.2.2 to demonstrate the applicability of the project activity with the applicability conditions in the AMS-I.D, version 15 for foot 1 and 2 of the meth. PP is The foot notes have been B.2 incorporated in the table of project applicability in section B.2 of the revised PDD. The section B.2 of the PDD has been revised as per PDD filling guideline.
CER price has been brought down to EUR 22 which appears reasonable. CAR is closed.
Ok, required changes has been incorporated in section B.2 of the PDD. Hence CAR is closed.
Version No.: 04
Page 118
Validation Report
01 997 9105057438
CAR -27
requested to justify and include applicability of the project with these foot notes of the methodology. Moreover the PDD filling guideline demands for the justification of the choice of project type and category. The same needs to be included in section B.2 of the PDD. It was found during the site 4.2 visit that the type and number of SPV modules as mentioned in the supply and service agreement is not the same which is being installed at the site. Instead of 78Wp, several SPV modules e.g. 76, 78, 80, 82 , 84 and 86 Wp modules in different number are being installed. PDD should undergo change in this regard.
The supply agreement made between SIIPL (called as Employer) and Moser Baer Engineering & Construction Limited (Called as Contractor) mentions that the contactor would supply goods for the 5MW solar PV power plant As explained above It is evident from the Supply and service agreement that contractor is responsible to provide thin film solar module of average capacity 78Wp to make total installed capacity of 5MW. In line with the Service and supply agreement several SPV modules e.g. 76, 78, 80, 82 , 84 and 86 Wp modules in different number are supplied by the contractor and are being installed in the project activity. Irrespective of Watt peak of the modules the unit cost per Wp remains constant for the project. Hence change in the individual
OK, the required correction and the justification are deemed to be acceptable and hence this CAR is closed.
Version No.: 04
Page 119
Validation Report
01 997 9105057438
capacity of module does not have any implication on the project financials. Only the number of modules used in the project activity would differ accordingly. It is also important to note that all the modules being installed under this project activity falls under same type 1/4size MBTF 100.
CAR-28
Since the Request for 5.1.1 Registration under the applied version of methodology i.e. version 15 and requests for registration can only be submitted until 10 Feb 2011 23:59:59 GMT using this version of the meth, PP is requested to revise the methodology version and the PDD accordingly.
The required changes have been made in the revised PDD. All relevant section of PDD has Several The PDD is appropriately modified in been revised as per the version sections of accordance with AMS. I.D version 16. The 16 of AMS I.D. the final compliance check of additional or modified PDD requirements (applicable to this given project activity) of AMS.I.D, Ver 16 in compassion with AMS.I.D, Ver 15 is done by the validation team and deemed all correction/revision to be appropriate.
Version No.: 04
Page 120
Validation Report
01 997 9105057438
Table 3: List of forward action requests (FARs)

FAR number
--
Reference Summary of project owner response

----
Validation team conclusion
Version No.: 04
Page 121
Appendix B
CERTIFICATES OF COMPETENCE
Version No.: 04
Page 122
Qualification
Urs, Praveen /
Emission Trading
United Nations Framework Convention on Climate Change Auditor No.:
(AuditorenRegNr)
Appointed:
(Zugelassen)
ja ja
Qualification Level:
(Qualifikationsstufe)
External:
(Externer)
Add. reviewer:
(Zustzlicher Prfer)
yes
EAC Scopes:
(EAC Branchen)
CDM 01 - Energy industries (renewable - / non-renewable sources) CDM 13 - Waste handling and disposal
Add. qualification:
(zus. Qualifikation)
First Appointment:
(Erstberufung)
2010/08/31
Valid to:
(Gltig bis)
2013/08/30
Remarks: Languages:
Valid for TA 01.2, 13.1 Hindi English
Experience Exchange
Date Location Remarks Accreditation(s)
Monitoring
Latest Monitoring:
(letzte Beurteilung)
Next Monitoring:
(nchste Beurteilung)
Remarks: View / Edit Monitoring
History of scope allocation

Date: Change: By: Reason: 2010-11-17 EAC CDM, CDM added Manfred Brinkmann Valid for TA 01.2, 13.1
History Created: 2010/11/17 11:47:44 Manfred Brinkmann/Jpn/TUV
Modified:
2010/11/17 11:54:09 2010/11/17 11:48:19
Manfred Brinkmann/Jpn/TUV Manfred Brinkmann/Jpn/TUV
Qualification
Jana, Asim Kumar /
Emission Trading
United Nations Framework Convention on Climate Change Auditor No.:
(AuditorenRegNr)
Appointed:
(Zugelassen)
ja ja
Qualification Level:
(Qualifikationsstufe)
External:
(Externer)
Add. reviewer:
(Zustzlicher Prfer)
yes
EAC Scopes:
(EAC Branchen)
CDM 01 - Energy industries (renewable - / non-renewable sources) CDM 03 - Energy demand CDM 04 - Manufacturing industries CDM 12 - Solvents use CDM 02 - Energy distribution CDM 11 - Fugitive emissions from production and consumption of halocarbons and sulphur hexafluoride CDM 13 - Waste handling and disposal CDM 05 - Chemical industry
Add. qualification:
(zus. Qualifikation)
First Appointment:
(Erstberufung)
2009/06/02
Valid to:
(Gltig bis)
2012/06/01
Remarks:
2010-10: revised to meet Accreditation Standard Ver.02: - CDM 01: valid for TA1.1, 1.2 - CDM 02: valid for TA2.1, 2.2 - CDM 03: valid for TA3.1 - CDM 04: valid for TA4.5 - Other WHR and Fuel switch projects - CDM 05/11/12: valid for TA5.1 / 11.1 / 12.1 - CDM 13: valid for TA13.1 - Waste handling and disposal Hindi English
Languages:
Experience Exchange
Date Location Remarks Accreditation(s)
Monitoring
Latest Monitoring:
(letzte Beurteilung)
Next Monitoring:
(nchste Beurteilung)
Remarks: View / Edit Monitoring
History of scope allocation

Date: Change: By: Reason: 2009-06-03 EAC CDM, CDM, CDM, CDM added Manfred Brinkmann scope 4 limited to fuel switch
History Created: Modified: 2009/04/21 19:24:07 ZE5B 2011/01/06 11:55:54 2010/09/12 18:07:27 Asim Kumar Jana/Ind/TUV Manfred Brinkmann/Jpn/TUV Manfred Brinkmann/Jpn/TUV

FVR - 5MW Tamil Nadu

Uploaded by

Copyright:

Available Formats

You might also like

FVR - 5MW Tamil Nadu

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

FVR - 5MW Tamil Nadu

Uploaded by

Copyright:

Available Formats

VALIDATION REPORT

TV Rheinland Japan Ltd.

Project Participants M/s Sapphire Industrial Private Limited (SIIPL) Infrastructures

Validation Phases: Desk Review Follow up interviews Resolution of outstanding issues

III. Validation Report:

No distribution without permission from the Client or responsible organizational unit

Designated Operational Entity (DOE):

TV Rheinland Japan Ltd.

Executive Summary Validation Opinion

Appendix A: Validation Protocol Appendix B: Certificates of Competence

The following sections outline each step in more detail.

2.1 Desk Review of the Project Design Documentation

/P17/ /P18/ /P19/ /P20/ /P21/

/P23/ /P24/ /P25/ /P26/ /P27/ /P28/ /P29/ /P30/ /P31/

/B06/ /B07/ /B08/ /B09/

22/09/2009 http://tnerc.tn.nic.in/regulation/Tariff/2009/Amendment%20to%20order%20N o.%206%20of%202008.pdf

/B11/ /B12/ /B13/ /B14/

2.2 Follow-up Interviews with Project Stakeholders

/I-03/ /I-04/ /I-05/

29/03/2010 to 30/03/2010 29/03/2010 to 30/03/2010 20/08/2010

2.3 Resolution of Outstanding Issues

Figure 1. Validation protocol tables

2.4 Internal Quality Control

2.5 Validation Team

3.1 Approval and participation

3.2 Project Design Document

3.3 Project Description

3.4 Baseline and Monitoring Methodology

3 of methodology. 4 of methodology. 5 of methodology. 6 of methodology. 7 of methodology.

NA Is the registered SSC PA registered within the previous 2 years?

3.4.2 Project Boundary

3.4.3 Baseline Identification

2008-09 2007-08 2006-07

Plant Load Factor

Combined margin for the Southern grid

Yes No Yes No Yes No Yes No Yes No Yes No Yes No

3.4.4 GHG Emission Reductions

(Cp Section B.6.3 of PDD /P02/)

3.5.1. CDM consideration

3.5.3. Investment Analysis

b) conducting an assessment of parameters and assumptions used in calculating the financial c) d) e) f)

b) Parameters and assumptions used:

Please see http://mnre.gov.in/press-releases/press-release-13072009-2.pdf /B17-2/ Please see http://www.cercind.gov.in/Regulations/Final_SOR_RE_Tariff_Regulations_to_upload_7_oct_09.pdf /B171/ (p.44/77).

e) Assessment of correctness of computation: The assessment involved checking the data

-10% 9.15% 10.63% 13.06% 10.94%

Base-case project IRR 10.84% 10.84% 10.84% 10.84%

+10% 12.43% 11.04% 9.10% 10.73%

3.5.4 Barrier due to prevailing practice

3.6.1 Parameters determined ex-ante

3.6.2 Parameters monitored ex-post

3.6.3 Management system and quality assurance

3.7 Sustainable Development

3.8 Environmental Impacts

3.9 Local Stakeholder Consultation

3.10 Comments by Parties, Stakeholders and NGOs

Table 1: Validation requirements

Findings, comments, references, data sources