CEIA CDM WORKSHOP

EXPERIENCE WITH CDM

“A VIEW FROM THE TRENCHES”

POLLUTECH ENVIRONMENTAL CONSULTANTS

GREGORY M. BROWN, P.ENG, M.A.Sc, MBA

POLLUTECH ENVIRONMENTAL CONSULTANTS

Leaders in the implementation of environmental technologies nationally and internationally for industrial and municipal applications

Incorporated in Ontario in 1969, serving our clients for 32 years

Permanent offices in Oakville and Sarnia, Ontario, Canada

Strategic alliances in USA, Spain, China, Egypt, Uruguay, Chile, Costa Rica, and Nicaragua

POLLUTECH ENVIRONMENTAL CONSULTANTS

Pollutech provides independent and objective waste & energy management services

With Climate Change projects we facilitate the generation and sale of greenhouse gas emission reductions

CLEAN DEVELOPMENT MECHANISM

The Clean Development Mechanism was created by Article 12 of the Kyoto Protocol

Article 12 of the Kyoto Protocol allows parties not included in Annex 1 (developing countries) to benefit from project activities resulting in certified emissions reductions, and Annex 1 parties to use certified emission reductions to contribute to compliance with their quantified emission limitation and reduction commitments

CLEAN DEVELOPMENT MECHANISM

The specific rules governing the implementation of the CDM are hoped to be decided (???) at the COP 6bis meeting in June 2001

This presentation provides a summary of a Pollutech project involving the ongoing application of the CDM to an energy from waste project in Nicaragua

COMPAŇIA LICORERA DE NICARAGUA

Established in 1890 150,000 L per day rum

distillery Light and aged rum

products Commercial alcohol

production Flor de Caňa present in 19

countries around the world ISO 9001/9002, HACCP, &

Kosher Certification Pursuing ISO 14000

WASTEWATER MANAGEMENT

Characterization of wastewater discharges

Evaluation of water conservation initiatives

Evaluation of pollution prevention initiatives

WASTEWATER MANAGEMENT

Distillery operations generate 750 GPM of high strength wastewater

• 51,000 mg/L BOD

• 64,000 mg/L COD

• 5,500 mg/L TSS

• 208,000 kg/d BOD

• 262,000 kg/d COD

• 22,000 kg/d TSS

TECHNOLOGY EVALUATIONS

Pilot scale testing of ADI anaerobic technology conducted

• 94% BOD removal• 82% COD removal• 76% TSS removal

Generation of biogas

• 65% methane• 33 % carbon dioxide 0

10

20

30

40

50

60

70

80

90

100

% R

em

oval

0

0.5

1

1.5

2

VA

/PA

Ratio

11/21 12/11 12/31 01/20 02/09 03/01 03/21 04/10 04/30 Date

COD BOD TSS VA/PA

PROCESS SCHEMATIC

Distillery

Cooling Wastewater

Slops Wastewater

Distillery

Cooling Wastewater

Slops Wastewater

AnaerobicTreatment

Distillery

Cooling Wastewater

Slops Wastewater

AnaerobicTreatment

Biogas

To Spray Irrigation or

Receiving Steam

Distillery

Cooling Wastewater

Slops Wastewater

AnaerobicTreatment

BoilerBiogasSteam

To Spray Irrigation or

Receiving Steam

To Distillery

Distillery

Cooling Wastewater

Slops Wastewater

AnaerobicTreatment

SteamTurbine

BoilerBiogasSteam

To Spray Irrigation or

Receiving Steam

Distillery

Cooling Wastewater

Slops Wastewater

AnaerobicTreatment

SteamTurbine

Boiler Electrical

Energy

BiogasSteam

To Spray Irrigation or

Receiving Steam

To Distillery

Distillery

Cooling Wastewater

Slops Wastewater

AnaerobicTreatment

SteamTurbine

Boiler Electrical

Energy

BiogasSteam

To Spray Irrigation or

Receiving Steam

To Distillery

To National

Grid

To Distillery

Distillery

Cooling Wastewater

Slops Wastewater

AnaerobicTreatment

AerobicTreatmen

t

SteamTurbine

Boiler Electrical

Energy

To National

Grid

To Distillery

BiogasSteam

To Spray Irrigation or

Receiving Steam

PROJECT IMPLEMENTATION

International Request for Proposals

Technical and Financial Analyses of Bids

Site visits to distilleries with similar technology

Project initiation in 3rd - 4th Q 2001

GREENHOUSE GAS EMISSIONS

Current operations generate 236,000 ton CO2e/year

Energy from waste project emissions are 44,000 ton CO2e/year

Emission reduction equivalent to 192,000 ton CO2e/year

US$0/year at US$0/ton C US$1,044,480/year at US$20/ton C

THE CDM PROCESS

To be certified, projects will require

• voluntary participation approved by each Party involved

• real, measurable and long term benefits related to the the mitigation of climate change

• reductions that are additional to any that would occur in the absence of the certified project activity

THE CDM PROCESS

CDM projects are required to result in emission reductions that are “additional to any that would have occurred in the absence of certified project activity”

The easiest tests of additionality are the introduction of new technologies to the market or projects where emission credits are a critical economic factor

All CDM projects are nation to nation bilateral agreements requiring the consent of the Canadian and host country governments

THE CDM PROCESS STEPS

Establishment of emissions baseline Quantification of emission reductions achieved by

the project Verification of emission reductions on an annual

basis Host Country project recognition Investor Country project recognition Host Country - Investor Country Project Agreement Registration of project with the UNFCCC Sale of Credits on the world market annually

THE CDM PARTICIPANTS

Canadian CDM/JI Office

Nicaraguan CDM Office

THE WORLD BANK PROTOTYPE CARBON FUND

Project has been preselected by the PCF $US3.0 million to purchase GHG credits

Project Identification Notice (PIN) Nicaragua “No Objection” Project Concept Note (PCN) Nicaragua “Letter of Endorsement” Project Appraisal Document (PAD) Monitoring and Verification Protocol (MVP) Emissions Reductions Purchase Agreement (ERPA)

THE CDM PARTICIPANTS

Canadian Commercial Corporation (CCC)

Export Development Agency (EDC)

Financing Agencies• International Finance Corporation (IFC)• Inter-American Investment Corporation (IIC)• Central American Bank for Economic Integration

(CABEI)

UNFCCC

CDM PROJECT COORDINATION

CLNSA

NICARAGUACDM

CANADACDM

IFC

CABEI

IIC

UNFCCCCCC

EDC

POLLUTECH

CDM PROJECT ATTRIBUTES

CDM can enhance the value and cash flow of international development projects

CDM can result in complex implementation models

Complexity can increase transaction costs

Uncertainty - Need definitive rules for CDM projects

Risk - Sale of Emission Reduction Credits

POLLUTECH ENVIRONMENTAL CONSULTANTS

Visit us in the Ontario Pavilion

Visit us at www.pollutech.com