PDD Potrerillos Traducci N Version Finalparatv200706012

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03.1.
CDM – Executive Board page 1
CLEA DEVELOPMET MECHAISM

PROJECT DESIG DOCUMET FORM (CDM-PDD)
Version 03 - in effect as of: 28 July 2006
COTETS
A. General description of project activity
B. Application of a baseline and monitoring methodology
C. Duration of the project activity / crediting period
D. Environmental impacts
E. Stakeholders’ comments
Annexes
Annex 1: Contact information on participants in the project activity
Annex 2: Information regarding public funding
Annex 3: Baseline information
Annex 4: Monitoring plan
Annex 5: CEMPPSA´s newspaper article
Annex 6: Photographs of project

SECTIO A. General description of project activity
A.1 Title of the project activity:
Exploitation of the Mendoza River, Potrerillos Project (Original title: Aprovechamiento Integral
del río Mendoza, Proyecto Potrerillos) – Hydroelectric Power - Argentina.
Version 01
April 2007
A.2. Description of the project activity:
The objective of this Project is the generation of renewable electric power at the Álvarez
Condarco and Cacheuta Nueva Hydroelectric Power Stations, located in the Province of
Mendoza, Argentine Republic. The reduction of CO2 emissions is achieved through the
displacement of electricity generated from fossil fuel by electricity generated from renewable
sources. Thus, it is estimated that the annual average of emission reduction will be of
221,998.53 tons of equivalent CO2 during a crediting period of 7 renewable years (21
altogether).
The Potrerillos Exploitation Project was carried out by CEMPPSA (Consortium of Mendocinian
Companies for Potrerillos Business Corporation). The Project uses the water flow of the
Mendoza River with the following purposes:
• To enlarge and normalize the irrigated area;
• To control flood events in the Mendoza River;
• To satisfy the requirements of potable water and water for agriculture and industrial use in
the Mendoza suburban area and its influence area;
• To increase the production of electric power in the province.
CEMPPSA was granted the concession of the old power stations Álvarez Condarco and
Cacheuta and it has undertaken the construction of the Potrerillos Dam and the Cacheuta Nueva
Power Station. Moreover, two existing machines from the Álvarez Condarco Station were
repowered and a third machine was incorporated, as explained below:
− To the effects of this CDM project activity, the Cacheuta Nueva Power Station has been
built. The station has a Maximum Installed Generation Capacity of 126.40 MW, and is
made up of four (4) generation units of 31.60 MW each. This station has replaced the
old Cacheuta Station, which had a maximum installed capacity of 9 MW and three (3)
generators of 3 MW each of which had been working since the year 1926.
− Also, as part of the CDM Project, two existing equipment units of 13.7 MW have been
repowered at the Álvarez Condarco Station, which now have 15.20 MW, and a new
generator has been incorporated of 24.54 MW.
Both stations are located in a cascade design and are fed by their own adduction, which
originates at the Potrerillos Dam.
During the period between May 2002 and October 2003, the units at both stations gradually
began operating commercially. However, this Project does not claim retroactiveness for the
years of operation before 2007.
With the registration of the Project in the CDM, CEMPPSA plans to implement an aid fund for
state technical schools in the province of Mendoza. The funding necessary to carry out said
activity will be secured from the sale of carbon credits obtained by this Project, by means of a
trust fund created for this purpose. This will be an important contribution by the Project to the
region´s sustainable development, apart from the contributions inherent to the Project which are
set forth below:
• The increase of the clean energy rate in the Argentine Interconnection System (SADI), by
displacing sources of intensive carbon generation, and covering approximately 25% of the
electric power consumption of the Province.
• Expansion and improvement of the water supply for the irrigated oasis, which will favor
the necessary conditions for the sustained growth of Mendoza´s economy.
• The assurance of a potable water supply for the population of the Mendoza River oasis,
control of its flow volume and reduction of the risk caused by its periodic overflooding.
• A substantial boost to local and foreign tourism, through the existence of a permanent
water mirror, attractive to both effective and sedentary tourists, which will represent an
important source of indirect employment and a growth factor for the whole province. In
fact, during the construction stage, 1,200 people have benefited from direct employment.
A.3. Project participants:
ame of Party involved (*) Private and/or public Kindly indicate if

((host) indicates a host Party) entity(ies) the Party involved
project participants (*) wishes to be
(as applicable) considered as
project participant
(Yes/o)
Argentina (Host) CEMPPSA (Consortium of o

Mendocinian Companies for
Potrerillos Business Corporation)
(*) In accordance with the CDM modalities and procedures, at the time of making the CDM-PDD public
at the stage of validation, a Party involved may or may not have provided its approval.
At the time of requesting registration, the approval by the Party(ies) involved is required.
A.4. Technical description of the project activity:
A.4.1. Location of the project activity:
A.4.1.1. Host Party(ies):

Argentine Republic
A.4.1.2. Region/State/Province etc.:

Province of Mendoza
A.4.1.3. City/Town/Community etc:

Departments of Las Heras and Luján de Cuyo.
A.4.1.4. Detail of physical location, including information

allowing the unique identification of this project activity (maximum one page):
The Potrerillos Exploitation Project is located on the Mendoza River, in the Province of the
same name, in the Cuyo region of the Republic of Argentina (mid-west).
Mendoza is bounded by the province of San Juan to the north, by the provinces of San Luis and
La Pampa to the east, by the provinces of La Pampa and Neuquén to the south and finally by the
Republic of Chile to the west.
The Potrerillos Dam is situated on the Mendoza River, at 33° 01´ south latitude and 69° 06´
west longitude, at 1,300 m.a.s.l. in the area near the village of Cacheuta and downstream from
the village of Potrerillos. The Project area has access from Provincial Route N° 82. The distance
from the city of Mendoza is 35 km from Cacheuta and 46 km from Potrerillos.
In the Project area, the Mendoza River –which is part of the Desaguadero Basin- constitutes the
boundary between the departments of Luján de Cuyo and Las Heras, the former extending from
the right margin of the River while the latter from the left margin.
The Cacheuta Nueva Station is specifically located at geographic coordinates X: 6.346.375 and
Y: 2.489.575, while the Álvarez Condarco Station is located at coordinates X: 6.344.300 and Y:
2.495.200, both on the margins of the Mendoza River.
The department of Luján de Cuyo has a surface of 4,847 km2 and a population of approximately
70,000 inhabitants; while the department of Las Heras has 8,955 km2 and 130,000 inhabitants.
South America Mendoza/Argentina
Area of the Project activity
Map References:
Río Mendoza: Mendoza River Vertedero: Spillway (Morning Glory type,
Río Blanco: Blanco River Design flood 1800 m3/sec)
Río Seco Cacheuta: Cacheuta Dry River Túnel de aducción: Adduction Tunnel
Zona Curva del icho: Curva del icho Area Central Cacheuta: Cacheuta Power Station
Túnel de riego, desvío y descargador de fondo: Central Álvarez Condarco: Álvarez Condarco
Irrigation, Diversion and Bottom Discharge Power Station
Tunnel (350 m of length, 10.80 m in diameter) Sub-Estación Luján de Cuyo: Luján de Cuyo
Presa Potrerillos: Potrerillos Dam Substation
A.4.2. Category(ies) of project activity:
According to the Categories and Scope of the CDM projects defined by the UNFCCC, this project
activity belongs to Category 1: Renewable Energy (Scope umber: 1 - Sectorial Scope: Energy industries
(renewable - / non-renewable sources)).
A.4.3. Technology to be employed by the project activity:

The basic operating principle by which the technology used allows the generation of electricity consists of
exploiting the potential energy of the water collected in the dam, situated at a higher level than the power
station, where the hydraulic turbines and generators are placed. The water gets there carried through a
discharge or adduction pipeline.
The Potrerillos dam consists essentially of a main body of triangular shape made of loose rockfill, not
earthfill, strongly compacted and with a high draining capacity, and of a thin layer of concrete in the
upstream face to provide impermeability. This type of dam is also commonly called CFRD (Concrete
Faced Rockfill Dam).
It is situated at around 3.5 km upstream from the village of Cacheuta, where the riverbed reaches around
1,272 m.a.s.l. Its maximum height from the foundation is 116 m, its length at the crest is 480 m, and its
width is 395 m wide at the base. The dam thus formed floods a maximum surface of 1,300 Ha and creates
a useful volume of 310 hm3. The dam has a Morning Glory-type spillway with a tunnel that is 300 m long
and 11.8 m in diameter.
The figure below shows the typical sections of the Potrerillos Project:
Figure 1. Typical sections of the Potrerillos Project
References Figure 1
- ivel Agua: Water level - Pantalla H° Armado: Reinforced concrete lining
- m.s.n.m.: m.a.s.l. - Enrocado: Rockfill
- Espaldón: Embankment - Chimenea de Equilibrio: Staff gage

- Dren: Drainage - Túnel de Aducción y Conducción: Adduction tunnel
- Pared H° Colado: Concrete wall - Central: Power station
The Machine House of the Cacheuta Nueva Power Station is situated very close to the old Cacheuta
Power Station --which has been out of service since May 2002--, in a new building constructed next to the
old one. This new building is made up of reinforced concrete in all its levels and is earthquake-resistant,
in accordance with the regulations for earthquake-resistant buildings in Mendoza.
Four new Francis-type turbogenerators have been installed at the Cacheuta Nueva Power Station, each
with a maximum capacity of 31.60 MW, the four of them totaling 126.40 MW. They have a vertical axle,
a maximum turbinable flow of 80 m3/s of water and a maximum gross head of 178.2 m.
The power station is fed through an adduction tunnel that is approximately 4.650 m long. Cacheuta Nueva
has been an agent of the MEM (Argentine Wholesale Electric Market) since April 2002, and sells the
generated energy through the SPOT Market.
Operations at the old Cacheuta Station ceased in May 2002 and its facilities and equipment are not
currently used. This power station had started running in 1926 and had three generators of 3 MW, which
amounted to a total maximum installed generation capacity of 9 MW. The old Cacheuta Station was not
an agent of the MEM but used to sell the generated energy directly to the distributor, EDEMSA1 being the
last distributor.
Table 1 summarizes the main technical characteristics of the old Cacheuta and the Cacheuta Nueva Power
Stations:
Table 1. Characteristics of the old Cacheuta and the Cacheuta ueva Power Stations
Hydroelectric Power
Characteristics Unit or Description Amount
Station
Maximum installed
MW 126.40
capacity
Maximum installed
MW 31.60
Cacheuta ueva capacity per unit
Number of units U
4
Type of turbines Francis - vertical axle
Annual generation GWh/year 520 +/- 60
Maximum installed
MW 9
capacity
Maximum installed
MW 3
capacity per unit
Old Cacheuta Number of units U
3
Average annual
generation (five-year GWh/year 60.15
period 1996-2000)
1
http://www.edemsa.com/
The Machine House of the Álvarez Condarco Power Station is situated downstream from the Cacheuta
Power Station. The CDM Project added a generator unit to the Power Station with a maximum capacity
of 24.54 MW and repowered two existing units from 13.7 MW to a maximum installed capacity of 15.20
MW.
Before the implementation of the CDM Potrerillos Project, the Álvarez Condarco Power Station provided
the generated energy directly to the distributing company, EDEMSA. After the implementation of the
Potrerillos Project, it still provides its energy directly to EDEMSA, but its dispatch is now controlled by
CAMMESA (Wholesale Electric Market Managing Company), the company in charge of dispatch (OED)
in Argentina.
Table 2 summarizes the main technical characteristics of the old and new Álvarez Condarco Power
Stations:
Table 2. Characteristics of the old and new Álvarez Condarco Power Stations
Hydroelectric Power
Characteristics Unit or Description Amount
Station
Maximum installed
MW 54.94
capacity
Maximum installed 1x24.54
ew Álvarez MW
capacity per unit 2x 15.20
Condarco
Number of units U
3
Annual generation GWh/year 259+/- 30
Maximum installed
MW 27.4
capacity
Maximum installed
MW 2x 13.7
capacity per unit
Old Álvarez
Number of units U
Condarco 2
Average annual
generation (five-year GWh/year 125.07
period 1996-2000)
Before this Project was implemented, the Álvarez Condarco Power Station generated an annual average
of 125.07 GWh (five-year period 1996-2000).
The energy generated from the Cacheuta Nueva Power Station gets to the Argentine Interconnection
System through a new line of 132 KV that connects the power station with the Luján de Cuyo
Transforming Station, located at a distance of 15 km. The Project also involved the construction of two
new service lines of 13.8 KV. One of them links Cacheuta and Álvarez Condarco and is 6.8 km long, and
the other, which is 6 km long, is a service line to the dam used to feed the power station itself.
The telecontrol and communications system includes two processing units in Hot/Stand-by mode (Front-
End) which enables the communications interface between the digital control level and the local control
level.
A.4.4 Estimated amount of emission reductions over the chosen crediting period:
Annual estimation of
Year emission reductions in tons
of CO2e
2007 221.998,53
2008 221.998,53
2009 221.998,53
2010 221.998,53
2011 221.998,53
2012 221.998,53
2013 221.998,53
2014 221.998,53
2015 221.998,53
2016 221.998,53
2017 221.998,53
2018 221.998,53
2019 221.998,53
2020 221.998,53
2021 221.998,53
2022 221.998,53
2023 221.998,53
2024 221.998,53
2025 221.998,53
2026 221.998,53
2027 221.998,53
Total reduced emissions (tons of 4.661.969,14
CO2e)
Total number of years of the 7
crediting period
Annual average of reduced emissions 221.998,53
throughout the crediting period (tons of
CO2e)
A.4.5. Public funding of the project activity:
The Project does not include public funding.

SECTIO B. Application of a baseline and monitoring methodology
B.1. Title and reference of the approved baseline and monitoring methodology applied to the
project activity:
This Project uses the methodology ACM0002/Version 06: “Consolidated baseline methodology for grid-
connected electricity generation from renewable sources”.
ACM0002 - Version 06
Sectorial Scope: 1
May 19, 2006
B.2 Justification of the choice of the methodology and why it is applicable to the project activity:
The methodology ACM0002/Version 06 has been chosen since this project complies with its applicability
conditions.
• It applies to electricity generation capacity additions from:
− Run-of-river hydroelectric power plants; hydroelectric power plants with existing reservoirs where
the volume of the reservoir is not increased
− New hydroelectric power plants with reservoirs having power densities (installed power generation
capacity divided by the surface area at full reservoir level) greater than 4 W/m2
− Wind sources
− Geothermal sources
− Solar sources
− Wave and tidal sources
• This methodology is not applicable to project activities that involve switching from fossil fuels to
renewable energy at the site of the project activity, since in this case, the baseline scenario would be
the continued use of fossil fuels at the site.
• Both the geographic boundaries of the project and the boundaries of the relevant electric grid must
be clearly identified, and information on the electric grid must be available.
The development of this Project according to the methodology ACM0002/Version 06 is appropriate

because of the following reasons:
− This Project involves the electricity generation capacity addition from a new hydroelectric power
station with a reservoir having a power density greater than 4 W/m2 (this calculation is explained in
detail in section B.6.3).
− This proposed Project does not involve switching from a fossil fuel to a renewable energy source at
the site of the project activity.
− Both the geographic boundaries of the Project and the Argentine Interconnection System (SADI) can
be clearly identified, and information on the characteristics of the grid is publicly available.
As explained so far, the consolidated baseline methodology ACM0002/Version 06: “Consolidated

baseline methodology for grid-connected electricity generation from renewable sources” is applicable to
this project activity. This methodology is used together with the approved and consolidated monitoring
methodology ACM0002/Version 06: “Consolidated monitoring methodology for zero-emissions grid-
connected electricity generation from renewable sources”.
B.3. Description of the sources and gases included in the project boundary
In order to determine the baseline emissions, the adopted methodology states that only CO2 emissions
from electricity generated with fossil fuels should be considered, which is displaced by this project
activity.
According to the methodology ACM0002/Version 06, within the boundaries of new hydroelectric power
station projects with reservoir, emissions occurring at the physical site of the plant as well as in the
reservoir area must be included.
The spatial extent of the project should include the project site itself as well as all the power plants
physically connected to the electric grid to which the CDM project is connected.
The following definitions are used in order to determine the emission factors of the Build Margin (BM)
and the Operating Margin (OM):
− The Project Electric Grid: the spatial extent of the generating power plants that can be dispatched
without significant restrictions on transmission.
− The Connected Electric Grid: electric grid connected through transmission lines to the Project
electric grid and in which generating plants can be dispatched without significant restrictions on
transmission. It can be national or international.
This CDM project has adopted the MEM (Argentine Wholesale Market) as the Project´s Electric Grid and
the dispatch information will be provided by CAMMESA (Wholesale Electric Market Managing
Company).
The MEM is the number of transactions of electric power in block made through the Argentine
Interconnection System (SADI), or through any other interconnection system subject to federal
jurisdiction, since the latter would be subject to the interjurisdictional wholesale electric trade.
The SADI is the number of transmission, transformation, compensation and operation facilities that
comprise the High Voltage Transport System and the Electric Power Transportation by Trunk
Distribution of the different electric regions of Argentina.2
2
Definition from CAMMESA´s 2004 Annual Report
With the Álvarez Condarco and Cacheuta Nueva hydroelectric power stations, the Potrerillos Project
joins the SADI as part of the electricity system of the Cuyo region. Figure 2 below shows a geographic
diagram of the SADI, figure 3 describes the electricity system of Mendoza city, and figure 4 represents
the MEM´s installed capacity divided by areas.
Figure 2. Geographic Diagram of the SADI´s Electric Grid3
3
http://www.cammesa.com/inicio.nsf/marcomemnet
Figure 3. Geographic Diagram of the electric grid of Mendoza city4
4
http://www.cammesa.com/inicio.nsf/marcomemnet
Figure 4. MEM Installed Capacity5
References Figure 4:
Autogenerators are not included except Agua del Cajón
- Valores en MW: Values in MW
- OA: orthwest Argentina
- EA: ortheast Argentina
- Centro: Central Region
- GBA+LIT+BAS: Buenos Aires Suburbs + Littoral Region + Southern Buenos Aires
- COM: Comahue Region
- PATAG: Patagonia Region
5
CAMMESA´s Monthly Report – December 2006
Figure 5 shows the unifilar diagram of the SADI owners in the Cuyo region (March 2007)6, including the
Cacheuta Nueva Power Station and the Alvarez Condarco Power Station:
Old Station (units out of

service)
Figure 5. Unifilar diagram of SADI owners (March 2007) – Cuyo region
In order to determine the emission factor of the Operating Margin (OM), one of the following options
must be used to determine the CO2 emission factor of the net electricity imports of the electric grid
connected within the host or guest country:
a- 0 tCO2/MWh; or
b- The emission factor(s) of the specific generating power plant(s) from where electricity is
imported, but only if this specific plant(s) is clearly identified; or
c- The average emission factor of the exporting grid as long as the net imports do not exceed 20% of
the total generation of the Project´s electric grid; or
d- The emission factor of the exporting network as long as the net electricity import does not exceed
20% of the total generation of the Project´s electric grid (Combined Margin).
For electricity imports from systems situated in other countries, the emission factor is considered to be
zero (0 tons of CO2 per MWh/year). The emission factor of the specific power plant from where the
electricity was imported may be used, but only if the said power plant is clearly identified.
6
The complete document of the March 2007 Unifilar Diagram is available at
http://www.cammesa.com/inicio.nsf/marcomemnet (access Esquemas de la Red Eléctrica – Unifilar por
Propietarios del SADI)
The electricity exports shall not be extracted from the information on electricity generation used for the
calculation and monitoring of the baseline scenario emissions.
Source Gas Included? Justification/Explanation

Thermal power CO2 Yes Fossil fuel burning at the thermal
plants power plants.
Baseline
Reservoir CH4 No According to Item II b of the

methodology AM0002/Version
Project Activity
06, if the power density of the

project is greater than 10 W/m2,
then the project emissions must
be considered zero (PEy = 0).
The power density of the
Potrerillos Project is 11.1492
W/m2.
B.4. Description of how the baseline scenario is identified and description of the identified
baseline scenario:
The baseline scenario is constituted upon the assumption that the electric power generated by the CDM
project activity would have had to be generated by the operation of the generation plants connected to the
grid (Operating Margin) and by the addition of new power sources (Build Margin).
To this end, the methodology ACM0002/Version 06 requires the calculation of an emission factor for the
baseline scenario. This factor is expressed as Emission Factor of the Combined Margin and is calculated
from the Operating Margin and the Build Margin. The information needed to calculate the Combined
Margin must be obtained from an official source. For the purposes of this Project, such information will
be provided by CAMMESA.
The methodology ACM0002/Version 06 states the calculation method for each of the factors mentioned.
The equations were included in this section of the PDD (as they are part of the identification of the
baseline scenario) and are shown in detail in Annex 3.
This section aims at providing a detailed description of the baseline scenario. To this end, all the steps
involved in its identification and definition will be explained below as well as the way in which each of
these steps are applied to this project activity.
In order to identify the most suitable baseline scenario for this Project activity, the methodology
ACM0002/Version 06 states the following two categories, depending on the intrinsic characteristics of
the project:
1) Project activities that do not involve changing or revamping the existing power generation
facilities, and
2) Project activities that involve changing or revamping the existing power generation facilities.
This Project activity may fall into both categories depending on the hydroelectric power station and unit
being considered. The following chart shows the baseline scenario selected for each of the units of the
Cacheuta Nueva and Álvarez Condarco Power Stations.
The following items refer to the scenario each unit belongs to:
b belongs
X does not belong
Table 3. Baseline Scenario according to Power Station and unit considered
Cacheuta Nueva Power Station Álvarez Condarco Power Station

Unit 1 Unit 2 Unit 3 Unit 4 Unit 1 Unit 2 Unit 3
Scenario 1 (Project activities that
DO NOT involve changing or
revamping the existing power
generation facilities)
X X X b X X b
Scenario 2
(Project activities that involve
changing or revamping the
existing power generation
b b b X b b X
facilities)
Description of the baseline scenarios

− Scenario 1
Electricity delivered to the grid by the project would have otherwise been generated by the operation of
grid-connected power plants and by the addition of new generation sources, as reflected in the combined
margin (CM) calculations described below.
− Scenario 2
In the absence of the CDM project activity, the existing facility would continue to provide electricity to
the grid (EGbaseline, in MWh/year) at historical average levels (EGhistorical, in MWh/year), until the
time at which the generation facility would be likely be replaced or retrofitted in the absence of the CDM
project activity (DATEBaselineRetrofit). From that point of time onwards, the baseline scenario is
assumed to correspond to the project activity, and baseline electricity production (EGbaseline) is assumed
to equal project electricity production (EGy, in MWh/year), and no emission reductions are assumed to
occur.
Where EGhistorical is the average of historical electricity delivered by the existing facility to the grid,
spanning all data from the most recent available year (or month, week or other time period) to the time at
which the facility was constructed, retrofit, or modified in a manner that significantly affected output (i.e.,
by 5% or more), expressed in MWh per year. A minimum of 5 years (120 months) (excluding abnormal
years) of historical generation data is required in the case of hydro facilities.
All project electricity generation above baseline levels (EGbaseline) would have otherwise been
generated by the operation of grid-connected power plants and by the addition of new generation sources,
as reflected in the combined margin (CM) calculations described below.
In order to estimate the point in time when the existing equipment would need to be replaced in the
absence of the project activity (DATEBaselineRetrofit), project participants may take the following approaches
into account:
a) The typical average operational lifetime of the type equipment may be determined and
documented, taking into account common practices in the sector and country, e.g. based on
industry surveys, statistics, technical literature, etc.
b) The common practices of the responsible company regarding replacement schedules may be
evaluated and documented, e.g. based on historical replacement records for similar equipment.
The point in time when the existing equipment would need to be replaced in the absence of the project
activity should be chosen in a conservative manner, i.e. if a range is identified, the earliest date should be
chosen.
The baseline emission factor (EFy) is calculated as a combined margin (CM), resulting from the
combination of operating margin (OM) and build margin (BM) factors according to the following three
steps. Calculations for this combined margin must be based on data from an official source and made
publicly available.
Power plant capacity additions registered as CDM project activities should be excluded from all
calculations below (subsets j, m, n below).
The following graph attempts to show clearly the baseline scenario presented as number 2, in which an
existing facility is modified by the project activities:
Existing units CDM Moment when units ( ) would have

without CDM Project probably had to be repowered or replaced
Project units by other units of similar characteristics in
absence of the CDM
From this moment ( ) on, the baseline

scenario is the CDM Project activity
The units deliver energy to the The energy generated at the baseline is the
grid at historical levels energy of the Project ( )
Therefore, from this moment on, the energy ( ) generated with

the units of the CDM Project ( ) considered for emission
reduction is that generated above the historical average ( )
Graph 1. Representative diagram showing the baseline scenario where the project activities modify an
existing facility
Once the Project´s baseline scenario has been identified, the GHG emissions for that scenario must be
calculated, i.e., the baseline emissions. Below is a description of the three steps to be followed in order to
calculate –according to the methodology ACM0002/Version 06 —such emissions. The equations and
values linked to the emissions will be described in section B.6.
STEP 1. Calculate the Operating Margin emission factor(s) (EFOM,y) based on one of the four
following methods:
(a) Simple OM, or

(b) Simple adjusted OM, or
(c) Dispatch Data Analysis OM, or
(d) Average OM.
According to methodology ACM0002/Version 06, Method 3 (Option c: Operating Margin according to

the Dispatch Information Data Analysis) must be the first methodological option.
This method requires detailed information on operation and dispatch of the power stations connected to
the grid. This Project uses method c) Dispatch Data Analysis, and the information needed for its
application will be obtained from the National Dispatch Center managed by CAMMESA7. The
calculation and related information are shown in detail in Annex 3.
STEP 2. Calculate the Build Margin emission factor (EFBM,y) as the generation-weighted average
emission factor (tCO2/MWh) of a sample of power plants m.
7
http://memnet2.cammesa.com/
The methodology requires two calculation options out of which the Project proposer must choose one.
The first option has been applied to this Project (ex –ante), i.e.:
The Build Margin Emission Factor (EFBM,y) has been calculated ex ante on the basis of the most
recently available information from the plants built, for a group of plants m at the moment of submission
of the project document. The group of plants m consists of:
- the 5 plants most recently built, or
- capacity additions in the electric grid that account for 20% of the system´s generation (MWh) and
that have been most recently built.
In the case of this Project, the option involving most power corresponds to the capacity additions in the
electric grid that accounted for 20% of the system´s generation (MWh) and that have been most recently
built. The calculation and related information are shown in detail in Annex 3.
STEP 3. Calculate the baseline emission factor EFy as the weighted average of the operating margin
emission factor (EFOM,y) and the build margin emission factor (EFBM,y).
The weights by default for each of the emission factors are 50% (except for wind and solar source
projects). Said weighted average –which is applied to this Project—has been set for the first crediting
period and will be checked at renewal.
As explained before, the explanation of the baseline emission factor is included in detail in Annex 3, and
section B.6 shows the calculations related to the emission reduction associated to the Project.
B.5. Description of how the anthropogenic emissions of GHG by sources are reduced below those
that would have occurred in the absence of the registered CDM project activity (assessment and
demonstration of additionality):
This Project´s potential for applicability to the Clean Development Mechanism has been assessed before.
In August 2001, before the devaluation of Argentine currency and the declaration of default on the
country´s foreign debt, and before the completion of the Project´s construction and the beginning of its
operation, CEMMPSA requested Mariana Conte Grand, PhD, Professor at CEMA (Argentine Center of
Macroeconomic Studies) and expert on the Kyoto Protocol, to assess the Project´s applicability within the
CDM framework.8
Said report, after making reference to the history of the Kyoto Protocol, concludes: “It is very likely that
the Project will obtain emission credits since it involves the displacement of power generated from more
polluting technologies such as thermal generation”.
After the political, economic and financial Argentine crisis at the end of 2001 and beginning of 2002, and
a few months before starting up the operation of the two first units of the Cacheuta Nueva Station, in May
2002, the possibility to introduce the Project into the Kyoto Protocol was reconsidered in order to get, in
this way, additional revenues from the sale of carbon credits. The Report by consultants Mercau and
Ontiveros entitled “Application of Green Credits to the Potrerillos Project” was motivated by the
macroeconomic and regulatory changes caused by the crisis, which prompted a new economic and
financial equation, different from the original Project.
8
Analysis of the Potrerillos Project´s potential to obtain Carbon Credits: steps to be taken. Mariana Conte Grand.
August 2001.
Both documents reveal the intention of implementing the Potrerillos Project as a CDM activity, prior to
the start up of any of the projected works.
The delay in the registration of this Project in the Mechanism was mainly due to the uncertainty
prevailing at that moment regarding the Project´s feasibility and implementation methodology.
Moreover, the macroeconomic crisis that Argentina went through during 2002 –lasting until 2005—had a
strong impact on the regulations of the Argentine power sector, which delayed even more the registration
of the Project in the Mechanism.
However, at the end of 2005, with a stable macroeconomic scenario and the certainty of the negative
impacts that the regulatory changes had had on CEMPPSA`s cash flows, the additionality of the Project,
far from being considered circumstantial, became a real and stable condition.
Along the lines of the foregoing, the Notes to the Accounting Statements of José Cartellone
Construcciones Civiles S.A. (JCCCSA), one of CEMPPSA`s private stakeholders, corresponding to the
fiscal year ended on December 31st, 2002 and 2003, state that “with regard to Norelec S.A., EDET S.A.,
Gascart S.A., CEMPPSA and Hidronihuil S.A., there is uncertainty about the effects of the cancellation,
as of January 2002, of the adjustment clauses in dollars, about the pesification of rates related to public
service concessions and about the beginning of a new stage of negotiation of concession contracts, taking
into consideration different criteria related to the impact of rates on the economy, on users and their
accessibility to public services, on the quality of the services, on investment plans and on the security of
companies` profitability systems”. They also state that “the creation of future funds and their capacity to
continue doing business depend on the successful renegotiation of their liabilities and concession
contracts. The future development of the economic crisis might require the modification by the
Government of some of the adopted measures or the announcement of additional regulations. Therefore,
the Company´s accounting statements must be read in the light of such circumstances”.
In addition, the Auditors` Report of the fiscal year mentioned above underlines that “As a consequence of
the uncertainty raised after 2002 and after the changes in the economic conditions of the country, we are
unable to predict whether the premises used to make the estimates that support the accounting value of the
assets of the companies mentioned in the previous paragraph will prove to be true in the future”.
It is for the reasons stated so far that the Potrerillos Project is applying to the Clean Development
Mechanism during 2007.
The studies carried out in the Additionality demonstration are based on the previously mentioned Report
by Mercau and Ontiveros “Application of Green Credits to the Potrerillos Project”, which analyzes the
additionality of the Project at the beginning of 2002, before the Álvarez Condarco and Cacheuta Nueva
Hydroelectric Power Stations started operating.
Since then, the private stakeholders decided to evaluate the different solutions to the Project and to take
the additional investment risks involved in order to finish the works they had engaged in, as well as those
related to the operation, by contributing their own capital and considering in their profitability analysis
the economic benefits stemming from the Project´s application to the CDM.
Step 1. Identification of alternatives to the project activity consistent with current laws and
regulations
Sub-step 1a. Define alternatives to the project activity:
Sub-step 1a Alternative Description

With this alternative, the electric power
Option 1 To finish construction of the Project generated by the Potrerillos Project is included
facilities and operate them without CDM in the grid and, thus, it displaces an equivalent
amount of energy from other generation
sources.
Option 2 To continue as in the present, without the In the absence of the Potrerillos Project, the
operation of the new hydropower electricity it would potentially generate would
stations Álvarez Condarco and Cacheuta be replaced by generation from other sources.
ueva
Sub-step 1b. Consistency with mandatory laws and regulations:
Option 1: To finish construction of the Project facilities and operate them without CDM
Both the proposal and the concession agreement signed between CEMPPSA and the Government of
Mendoza provided for construction and operation of the dam, as well as for enlargement and construction
of the Álvarez Condarco and Cacheuta Nueva stations respectively. Therefore, to continue with the
Project operation without it being considered a CDM activity was considered within the regulation.
Option 2: To continue as in the present, without the operation of the new hydropower stations Álvarez
Condarco and Cacheuta ueva
With relation to the Concession Agreement signed with the Provincial Government, certain circumstances
have arisen which might eventually result in the termination of the agreement. Thus, it would be a
possibility, and a viable alternative, not to operate the dam or finish the enlargement works of both
hydropower stations. It is worth mentioning that the Project Status Update Report drawn up by De Leuw
Cather International Limited in November 2001 points out that “A little over 90% of the works have been
carried out after nearly three years of work.”
In this respect, as stated in the document requested to the Marval, O’Farrel & Maizal law firm dated
January 15, 2001, “The Province may have breached important aspects of the Agreement and of the legal
framework applicable thereto inasmuch as:
i. They failed to comply with the Topics in their charge;

ii. They did not sign the Concession Agreement;
iii. They did not appoint a specialized field inspection team to decide on the non-objection to the
definitive Project and to certain improvements to be introduced to the Project;
iv. They did not reestablish the economic-financial equation affected by changes in tax legislation;
v. The payment of the funds committed for the financing of the Potrerillos Project was belated and
incomplete; and
vi. They did not abide by the adjustment formula agreed in the Bidding Conditions and the
Agreement for the payment of the referred funds.”9
The document, after a detailed analysis of each of the issues listed, points out that “even though the
Province has contributed a fair amount of their part of the funding, it is not possible to assert that their
failure to fulfill said obligations will not have adverse effects on CEMPPSA in its attempt to obtain a
reasonable financing plan for the Potrerillos Project. This is also detrimental as regards the uncertainty
caused on CEMPPSA and any eventual financiers about the timely fulfillment of the Topics incumbent
upon the Province, since one of the milestones of the Project will depend on said fulfillment: the filling up
of the Dam and the realization of the cash flow estimated and arranged by the parties to the Agreement.”
The report concludes: “by virtue of the stated situation, it is possible to maintain, with serious arguments,
that CEMPPSA is presently in a position to exercise the legal protection of its rights by stopping the
Project works or by terminating the Agreement because of the Province´s failure to meet their
obligations.10
The analysis carried out by the law firm mentioned above is prior to the end of the Argentine system of
currency Convertibility. Therefore, in addition to the failure of the Province to fulfill their obligations, a
series of administrative actions have taken place at the National level from January 2002 to this date
which have altered the Electricity Regulatory Framework (MRE) and thus affected the parties involved
therein. The most representative of such actions are the non-updating of Seasonal Prices since the year
2002 according to the provisions of the Electricity Regulatory Framework and Resolutions S.E. 246/02,
S.E. 240/03, S.E. 406/03 and S.E. 1281/0611 (by the Energy Secretariat), which affected the different
parties of the MEM as explained below:
− The Generator Agents are not properly remunerated.
− Generator Agents are not paid for great part of what they sell.
− Freedom of contract among MEM Agents has been restricted.
− The different parties of the MEM do not receive proper price signals.
− The Stabilization Fund (Fondo de Compensación), managed by CAMMESA, is presently
undergoing a deficit of over three thousand million pesos ($3,000,000,000).
− Demand: differential charges and crossed subsidies have been generated.
− These administrative actions have generated a legal instability which does not favor new
investments on the electric sector. This, without doubt, affects the growing demand of
energy required from the MEM by the different sectors of the economy.
9
Each of the items listed is developed in the above mentioned document.
10
Both alternatives are explained in detail in said document.
11
Each of the Resolutions mentioned is explained with greater detail in the Sensitivity Analysis.
Step 2. Investment analysis
Sub-step 2a. Determine appropriate analysis method
Renewable electric power is generated by the Potrerillos Project which is delivered to the Argentine
Interconnection System (SADI), generating earnings from the sale of said power. Therefore, the first
option, a simple analysis of costs, is not appropriate to prove additionality.
Between the other two options, Investment Analysis (Option II) and Benchmark Analysis (Option III), the
latter is considered more appropriate.
In the year 2002, in view of the economic and sectorial changes occurred in the country, CEMPPSA´s
private stakeholders -IMPSA and JCCC-, requested an economic-financial analysis to assess the impact
of regulatory changes on the cash flow originally estimated. A benchmark is used in said document to
analyze the economic-financial viability of the Project and determine a new action plan according to its
results. Said benchmark was also used by the private stakeholders at the moment of submitting the
economic proposal corresponding to the bidding process.
Therefore, the referred study, carried out by consultants Mercau and Ontiveros, is a document of
reference for this PDD, since it includes an analysis of the impact of the Argentine crisis on the internal
rate of return of the Project, in comparison with a benchmark representing standard returns in the market
for projects such as the Potrerillos Project, with great initial investments, all of them necessarily valued in
strong currencies (U$S, Euros), and considerable repayment periods. The report also calculates the impact
that the revenues added from the sale of CERs has on the IRR (Internal Return Rate).
Sub-step 2b – Option III. Apply benchmark analysis
Selection of the financial indicator
The indicator selected is the Project´s internal rate of return (IRR). This rate makes it possible to observe
whether the Project´s returns are sufficient for the involved companies and other investors to earmark
funds to the initial investment and bear the costs related to the operation.
The Project´s IRR is then compared to a benchmark, which behaves as a barrier which any project with
characteristics similar to the Potrerillos Project must exceed in order to be considered financially viable
and, consequently, assign funds to its construction and operation.
In other words, the considered benchmark implies a return to the cash flow of the Project capable of
making it sustainable in the long term, so as not to affect the continuity of the existing businesses of the
companies undertaking it and, besides, capable of obtaining the necessary funding in order for the Project
to be financially self-sustaining and to allow the companies to undertake projects in the future and keep a
reasonable debt pattern.
Benchmark to be used: an IRR of 14%
On the basis of different data and analyses carried out during the preparation of the proposal for this
business, and according to standards for this type of BOT projects (Build-Operate-Transfer) in Argentina,
the Potrerillos private stakeholders, at the moment of the bid, had requested for it a minimum return
equivalent to an internal rate of return of 14%12.
In this respect, Mercau and Ontiveros point out in their 2002 report that “This is known as ‘hurdle’, or the
barrier which a project must overcome in order to be considered by an investor. In the particular case of
CEMPPSA, such ‘hurdle’ involved the condition that the Project have a profitability greater than 14% in
order to obtain the participation of the qualified private stakeholders.” The referred hurdle, used to value
the project in the course of time and analyze its sustainability in the long term, constitutes the Benchmark.
Likewise, the above mentioned analysis is complemented by the Risk Assessment Report presented by
Humphreys Argentina Calificadora de Riesgo S.A.13 on February 5th, 2001. An assistance in the sum of
approximately U$S70,000,000 (seventy million US dollars) is evaluated in said report. This sum
represented the amount outstanding to complete the total financing of the works at such moment. Among
the main characteristics of the loan under evaluation, the risk assessment company states that the interest
rate is 14%. The report constitutes clear evidence that the returns demanded from the investment in the
Potrerillos Project had to at least equal the market rate of 14% in order to make possible the repayment of
the assistance under evaluation14.
It is worth mentioning that, if an IRR had to be considered at the present time for the development of this
type of activity in Argentina, such IRR would surely be considerably higher than 14%15. The cutoff IRR
for this type of projects is usually valued to be 50% to 100% superior to the credit cost. Thus, in the
present-day circumstances, an IRR in U$S of between 21% and 28% should be considered. This
consideration shall be included in the sensitivity analysis.
It is also worth pointing out that the fact that the rate used as benchmark has remained the same in the
course of time and against different contexts and conditions, with impacts of various kinds on the operator
of the Potrerillos Project, constitutes sufficient evidence of the connection of the referred “hurdle” with
the specific conditions of the Project and not with the characteristics of its private investors.
Sub-step 2c. Calculation and comparison of financial indicators
Flows of the original Project at the moment of Proposal (1995)

Folio 1898 of CEMPPSA´s economic proposal in 1995 is presented below in which the flows related to
the Obligatory Variant – Principal Alternative are registered.
12
This is stated in the contract documents. See CEMPPSA´s economic proposal year 1995 – Obligatory Variant –
Principal Alternative – Folio 1898.
13
The company Humphreys Argentina Calificadora de Riesgo S.A. is affiliated to Moody’s Investor Service.
14
Even though the Additionality Tool points out that the Benchmark must be representative of standard market
returns, considering the specific risk of this type of project, but not the subjective profitability prospects or risks of a
particular investor, the information presented in this paragraph is considered to be relevant since it makes it possible
to verify the adequacy of the benchmark to a project such as Potrerillos.
15
During the nineties the interest rate for working capital loans made by banks for this type of projects in Argentina
and carried out by Argentine companies fluctuated around a 9% annual rate. During the crisis it rose to 20% and it is
presently approximately 12%.

Chart references
Variante obligatoria –Alternativa principal: Obligatory variant –Principal alternative

ESTADO DE RESULTADOS: PROFIT AD LOSS ACCOUT
Año: Year
Facturación: Turnover
Otros ingresos: Other revenues
Facturación neta: et turnover
Inversión total: Total investment
Costos por operación y mantenimiento: Operation and maintenance costs
CAMMESA: Wholesale Electric Market Managing Company
Transportista independiente: Independent carrier
ERE: ational Electric Regulatory Organism
FRP: ational Public Broadcasting Fund
ORSEP: Dam Safety Regulatory Organism
Irrigación: Irrigation Department
Regalías provinciales: Provincial royalties
Ingresos brutos: Gross revenue tax
Sellado de contratos: Contract stamp tax duties
Garantías – Operación y mantenimiento: Securities – Operation and maintenance
Costos operativos: Operating costs
Excedente de explotación: Earned surplus
Intereses deuda a largo y corto plazo: Interests long and short-term debt
Intereses activos: Interest receivable
Saldo financiero: Financial balance
Depreciación de activos: Depreciation of assets
Resultado bruto: Gross margin
Impuesto a las ganancias: Income tax
Otros impuestos: Other taxes
Resultado neto: et margin
FLUJO DE FODOS: CASH FLOW
Año: Year
Aportes de la provincia: Province contributions
Excedentes de explotación: Earned surpluses
Capital de trabajo: Working capital
Inversiones: Investments
Impuesto a las ganancias: Income tax
Flujo de fondos: Cash flow
Tasa interna de retorno (TIR): Internal rate of return (IRR)
Valor presente neto: et present value
Brief reference to macroeconomic changes occurred and their impact on the originally estimated
flows
Political, Economic and Financial Crisis
After a recession period which began during the third quarter of 1998, the Argentine Government
declared, in December 2001, default on the country´s ninety-five thousand million dollar debt, which led
to the most severe crisis of sovereign debt in history16. The default came together with the end to the
system of currency Convertibility which had been in force in Argentina since 199117.
The default and the subsequent devaluation of the currency dramatically reverted investments and capital
inflow, which, having averaged 6% of the GDP in 1997-1998, were reduced to half in the year 2000, and
reverted completely in 200118.
Likewise, the impact on the financial market brought about the freezing of the bank deposits of the
Argentine people. The credit market was thus paralyzed. In view of these measures, the default and the
great uncertainty about the long term, the financing possibilities both in the domestic and the foreign
market were seriously restricted.
In this context, public services were not exempt from regulatory changes, which had a strong impact on
their expected revenues. The Public Emergency Law and the Foreign Exchange Regime Reform
stipulated not only the end to the Convertibility system but also the ‘pesification’ to AR$1:US$1 of public
service rates, as well as their ‘freezing’ through a prohibition to readjust or index them, which caused a
profound crisis in this sector.
The referred macroeconomic changes resulted in a significant instability, reflected in a country risk rate
which fluctuated between 4000 and 6600 basic points between the beginning of 2002 and June 2005,
reaching a peak of 7199 basic points at the beginning of June of 200219.
End to the System of Currency Convertibility
One of the characteristics of the political and economic context at the commencement of the Project was
the Convertibility Law. This Law ensured the Peso-Dollar parity in 1:1, that is to say, there did not exist a
free fluctuation of the value of the national currency. On the other hand, its value was fixed by law.
On the basis of this scenario, considerations as to whether to contract debt in dollars or pesos became
vague, since the parity between both currencies seemed guaranteed under the protection of a law. At that
time, to speak of pesos or dollars was equivalent, which is why in a Project such as CEMPPSA, requiring
an important investment, often in imported products, such a consideration was made, many times without
considerable distinction between items in pesos or dollars, since this type of investments –even
independently of whether items are of national or foreign origin- are valued in the currency in which the
market ultimately operates for this type of business, whether U$S or another strong currency such as the
Euro.
16
“Crisis financieras internacionales: ¿Qué rol le corresponde al gobierno?” (International Financial Crisis: What Is
the Role of the Government?) The Cato Institute, FIEL. 2003.
17
The regime of currency Convertibility was replaced with a dirty flotation regime, with recurrent interventions by
the Central Bank.
18
“Crisis financieras internacionales: ¿Qué rol le corresponde al gobierno?” (International Financial Crisis: What Is
the Role of the Government?) The Cato Institute, FIEL. 2003.
19
Source: EMBI (Emerging Markets Bond Index). Indicator calculated by J.P. Morgan
The situation changed radically in the year 2001, when in the month of December the National
Government decided to put an end to Convertibility, decision which led to a series of disastrous
consequences in the short term, and other worse consequences in the long term. With the parity peso-
dollar gone, the initial estimations made by CEMPPSA, especially those related to the return flow, were
dramatically modified. With the general crisis the country was going through, came governmental
restrictions for the regulation of items necessary to the country´s development, such as the price of fuels
and electric power, among others. Thus, CEMPPSA found themselves facing a very adverse scenario,
with bleak prospects of recovery.
In this respect, Mercau and Ontiveros point out that “Estimates take into account variations in the value of
the dollar and their irregular effect on the evolution of electricity rates, which is significantly lower than
the return of costs, which (the latter) tend to increase faster”.
The referred variation is an important point of consideration for companies which make a substantial
initial investment. As benefits are postponed in time, their value is reduced due to the effects of inflation
and uncertainty. National state policies with regard to the evolution of the electric power market and its
regulation present a future scenario in which recovery may become a reality.
Currency Mismatch
The Annual Report on CEMPPSA´s accounting statements corresponding to the fiscal year ended on
December 31st, 2002 points out that “It is important to highlight the impact of the new economic
measures taken by the National Government, which decreed the end to Convertibility by means of
different procedures according to the status of assets and/or liabilities”.
“These measures affected us directly as regards the composition of the Company´s liabilities, since the
agreement subscribed by our Company with the companies in charge of construction of the facilities has
remained in its original currency, that is to say, US dollars”.
“With regard to liabilities toward financial institutions, originally contracted in US dollars, they have
been pesified at AR$1 for each U$S 1, plus the corresponding update according to the CER coefficient*,
plus an interest rate”.
“These new measures of the National Government included the ‘freezing’ of public service rates, which
affected the evolution of the price of electric power”.
“Non-current assets are being financed with the Company´s own equity and, to a lesser degree, with long
term liabilities, mainly through the financing of the private stakeholders”.
More than 98% of current liabilities is toward the private stakeholders, caused by the update of debit
balances”.
*
Translator´s :ote.”CER” (Reference Stabilization Coefficient) One of the two indexes used to adjust pesified debts for inflation. CER adjusts
debts according to inflation in the prices of goods and services (as opposed to CVS, which adjusts debts according to the growth in salaries).
Part of a package of laws intended to shield debtors who borrowed in dollars from the collapse of the peso.
Changes in the rates of the Electric Power Sector
Within the context of general crisis, one of the most significant changes occurs in relative prices. Those
prices which were indexed to dollars during the Convertibility period, underwent a dramatic
transformation.
Profitability for CEMPPSA´s stakeholders is closely linked to the generation and sale of electric power.
In this respect, any change in rates has a direct impact on the profitability of the private stakeholders.
The rates used in the estimate drawn up during the bidding process of this Project were especially
calculated for the purposes of said estimate by Lapeña Consultancy Agency. The MARGO weekly
dispatch model was used, and weighted average prices were obtained from the fifty seven available
hydrologies. The fluctuations considered in this series consolidated halfway through the Project in
approximately U$S 31 per MWh generated. This estimate was, at the time, presented with supporting
documentation, and made emphasis on the economic reality of the time and on the exact market
conditions in which the estimate had been drawn up.
Along these lines, after the regulatory changes, such estimates of rates were no longer representative for
the sector. In comparison with the new 2002 estimate, not only are the new rates lower, but also, since the
year 2002, the rates originally estimated in dollars are received in pesos at a rate of AR$1:US$1. Such
changes in the estimate of rates result in a greater financial effort for power generation companies like
CEMPPSA, and create an economic stress with potential relief in the medium and long term. The
following graph shows the difference between prices expected in the year 1995 and those estimated in
2002.
Rate Estimated in 1995 vs. Rate Estimated in 2002 (US$/MWH)

35
30
25
20
15
10
0
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029
Monomial Rate (without inflation) estimated in 1995

Monomial Rate (without inflation) estimated in 2002
As observed in the foregoing graph, the new post-devaluation rate scenario, presented in the report drawn
up in the year 2002 by Mercau Ontiveros, shows a clear divergence with respect to the figures originally
estimated, since the prices estimated in the said 2002 report will at no point converge with those
estimated in the proposal documents of the year 1995. It is worth mentioning that the Potrerillos Project is
the first case in the country of a project implemented under the BOT (Build-Operate-Transfer) System, by
which CEMPPSA finances, constructs, operates the concession and transfers the Project to the State at the
end of the concession period.
Thus, considering that CEMPPSA´s benefits depend completely on the profits obtained from the sale of
electric power, it is extremely sensitive to short-term changes, especially of a political-economic nature.
Radical changes like those occurring at the end of 2001 and, subsequently, at the beginning of 2002
greatly affect the capacity of obtaining return and satisfying financial obligations previously assumed,
with a more stable scenario and less restrictive estimates. In fact, the additionality of this Project is
demonstrated on the basis of such facts.
Discount Rate
Evidently, the risk conditions of this new scenario have changed; reason why there might even be a new
discount rate required for energy projects with State participation. Even though a change in the required
profitability has not been considered in the analysis carried out, it is clear that the risk inherent to projects
of the magnitude and nature of CEMPPSA´s, after the changes occurred in Argentine economy during
2001-2002, is much higher than previously estimated.
Adjusted Flow: Calculation of the IRR against the changes in economic and rate conditions
(beginning de 2002)
The Mercau and Ontiveros Report “Application of Green Credits to the Potrerillos Project” estimates
once again the original flows and the IRR, taking into consideration the above mentioned changes.
Project IRR Benchmark

(2002)
10.5% < 14%
The report concludes that “Clearly, it can be demonstrated that the nature of the Project, from the
economic point of view, has changed dramatically. The “new” Potrerillos Project would not have
exceeded the “hurdle” to be seriously regarded by private investors in a pre-devaluation scenario. They
suddenly found themselves included in a project which, had those conditions been exposed beforehand,
they would not have taken part in.”
“In this context, it is necessary to use tools which can re-establish –at least partially- the initially
estimated profitability, and make this Project sustainable in the long term, both for society as a whole and
for those who committed themselves to this undertaking.”
In other words, since the Project´s IRR is lower than the considered Benchmark, the CDM Project activity
may not be considered viable without the revenues obtained from the sale of CERs.
Adjusted Project Cash Flow (2002)

Below is the estimated adjusted cash flow for the Project, used to calculate the IRR: 10.5%
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Generation 245.6 249 182.5 405 515 845 845 845 845 845 845 845 845 845 845 845 845
Monomial rate (without inflation) 24.8 29.5 27.3 7.6 6.9 9.7 11.3 13.5 16.4 17.9 19.3 22.6 25.4 28.2 28.2 28.2 28.2
Turnover (a) 6.1 7.3 5.0 3.1 3.6 8.2 9.5 11.4 13.9 15.1 16.3 19.1 21.5 23.8 23.8 23.8 23.8
Other revenues (b) 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9
NET TURNOVER (c=a+b) 7.3455 7.4 4.9823 3.078 3.5535 11.1 12.4 14.3 16.7 18.0 19.2 22.0 24.1 26.5 26.5 26.5 26.5
Total investment 71.8 102.1 73.2 12.6 0 0 0 0 0 0 0 0 0 0 0 0 0
Operation and maintenance costs (30%) (2.2) (1.7) (1.4) (0.7) (1.6) (1.4) (2.4) (3.0) (3.3) (3.4) (3.4) (3.4) (3.4) (3.4) (3.4) (3.4) (3.4)
CAMMESA (0.4%) (0.0) - (0.0) (0.0) (0.0) (0.0) (0.0) - (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1)
Independent carrier (2.4%) - - - (0.1) (0.1) (0.3) (0.3) (0.3) (0.4) (0.4) (0.5) (0.5) (0.6) (0.6) (0.6) (0.6) (0.6)
Nat Electric Regulatory Com (ENRE) (0.4%)(0.0) - (0.0) (0.0) (0.0) (0.0) (0.0) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1)
Nat Public Broadcasting Fund (FNRP) (1%) - - - - - (0.1) (0.1) (0.1) (0.2) (0.2) (0.2) (0.2) (0.2) (0.3) (0.3) (0.3) (0.3)
ORSEP (0.5%) (0.0) - (0.0) (0.0) (0.0) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1) (0.1)
Irrigation Department (2.5%) (0.2) 0.2 (0.1) (0.1) (0.1) (0.3) (0.3) (0.4) (0.4) (0.5) (0.5) (0.5) (0.6) (0.7) (0.7) (0.7) (0.7)
Provincial royalties (0%)
Gross revenue tax (0%)
Contract stamp tax duties (0%)
Securities–Operation and maint. (0.9%) - - - (0.0) (0.0) (0.1) (0.1) (0.1) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2)
Administrative expenses(6.57%) (0.5) (0.4) (0.4) (0.2) (0.2) (1.1) (0.8) (0.9) (1.0) (1.0) (1.0) (1.0) (1.0) (1.0) (1.0) (1.0) (1.0)
OPERATING COSTS (d) (2.4) (2.5) (2.1) (1.1) (2.1) (3.3) (4.2) (5.0) (5.7) (5.9) (5.9) (6.1) (6.3) (6.5) (6.5) (6.5) (6.5)
Earned surplus (e = c-d) 3.6 4.9 2.9 2.0 1.5 7.5 8.2 9.3 10.9 12.0 13.0 15.6 17.8 19.9 19.9 19.9 19.9
Financial balance (f) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Depreciation of assets (g) -2.8 -3.9 -3.8 -3.8 -3.8 -14.4 -14.4 -14.4 -14.4 -14.4 -14.4 -14.4 -14.4 -14.4 -14.4 -14.4 -14.4
Gross margin (e+f+g=h) 0.8 1.0 (0.9) (1.8) (2.3) (6.9) (6.3) (5.3) (3.5) (2.4) (1.3) 1.2 3.4 5.6 5.6 5.6 5.6
Calculation of Profits (35%) (0.30) (0.30) 0.30 0.60 0.80 2.40 2.20 1.90 1.20 0.80 0.50 (0.40) (1.20) (2.00) (2.00) (2.00) (2.00)
Carry-forward 0.30 1.00 1.80 4.20 6.40 8.30 9.50 10.30 10.80 10.40 9.20 7.20 7.20 7.20 7.20
Income tax (i) (0.30) (0.30) - - - - - - - - - - - - - - -
Other taxes (j) - - - - - - - - - - - - - - - - -
NET MARGIN (H+I+J=K) 0.5 0.6 (0.9) (1.8) (2.3) (6.9) (6.3) (5.3) (3.5) (2.4) (1.3) 1.2 3.4 5.6 5.6 5.6 5.6
CASH FLOW
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Province contributions 81.4 91.3 2.2 - - - - - - - - - - -
Earned surplus 3.6 4.9 2.9 2.0 1.5 7.5 8.2 9.3 10.9 12.0 13.0 15.6 17.8 19.9 19.9 19.9 19.9
Working capital (9.9) (14.7) (10.6) (1.4) 0.7 2.3 2.6 3.0 3.5 3.8 4.0 4.6 5.1 5.6 1.2 - -
Investments (71.8) (102.1) (73.2) (12.6) - - - - - - - - - -
Income tax (0.3) (0.3) - - - - - - - - - - - - - - -
Cash Flow 3.1 (20.8) (78.7) (12.0) 2.2 9.8 10.8 12.3 14.4 15.8 17.0 20.2 22.9 25.5 21.1 19.9 19.9
Sub-Step 2d. Sensitivity Analysis
In this section an analysis is made of the variation of the Internal Rate of Return when faced with
variations of key parameters. This analysis has two objectives: on the one hand to demonstrate that the
Potrerillos Project does not exceed the considered benchmark when faced with changes in key parameters
and, on the other hand, that the changes occurred after 2002, year for which the Project´s additionality is
analyzed, far from having improved the Project´s status, have imposed new obstacles on its development.
The so-considered key parameters in the cash flow and the variations to be applied are summarized in the
following table:
Variable Values to be used for the sensitivity analysis

Monomial Rate Realized values until 2006 and +/- 10% with respect to
values estimated in year 2002 for the period between
2007–2033.
Generation Realized values until 2006 and +/- 10% for the period
between 2007–2033.
Operation and Maintenance Costs Realized values until 2006 and +/- 10% for the period
between 2007–2033.
Discount Rate 21%
Below is a brief listing of the series of administrative actions which lead to consider a change in rates.
Variations in the monomial rate
The rates estimated in 1995 and those estimated in 2002 differ from the realized rates due to successive
modifications in the MRE (Electricity Regulatory Framework). Modifications introduced until the
beginning of the year 2002 have already been commented on in previous sections. Therefore, below is a
commentary on the modifications introduced after said period which had an impact on the rates collected
by CEMPPSA.
In this respect, from the year 2002 up to this date, various administrative actions have taken place which
have altered the MRE and therefore affected the parties involved therein. The most representative of them
are:
• o update of Seasonal Prices since the year 2002 according to the MRE stipulations. During
the first years no increase was approved. Then, in contravention of the principle of equality and
prohibition held by the MRE with regard to the generation of crossed subsidies, differential
increases were approved depending on the requesting agent. The non-approval of seasonal prices
according to the MRE stipulations has generated harmful impacts on the parties of the Wholesale
Electric Market (MEM) and distortive transferences of richness among different actors of the
national economy.
• Resolution S.E. 246/02. It stipulated the pesification of payments per KW to generator agents,
and such payments have remained fixed since August 2002 in the sum of AR$12. Payment per
KW was designed to set off investments. Its pesification is one of the factors that has turned non-
viable the return of investments and the commitment to perform new works.
• Resolution S.E. 240/03. This resolution distorts the marginalist concept defined by the MRE for
approval of the price of the electric power offered by generator agents. This resolution, which
limits the price of electric power, affects to a superlative degree the economic-financial equation
of generator agents.
• Resolution S.E. 406/03. This resolution stipulated the need to fix temporary mechanisms for the
assignment of scarce resources from the Stabilization Fund, which have been exhausted due to
the Government´s decision to maintain seasonal prices (the electric power prices paid by
distributors) lower than the Spot price paid to generators (who, at the same time, suffered
pesification and the freezing of certain costs). The origin of this Resolution was the lack of
resources of the Stabilization Fund due to the non-approval of a new Seasonal Price on the part of
the Energy Secretariat with the purpose of adjusting the deficit of said Fund (difference between
the seasonal rate paid by Distributors/Demand versus the Spot price approved for Generators). To
these effects, it stipulated a mechanism for the distribution of the money collected by
CAMMESA, setting a series of priorities. The balances outstanding payment each month were
consolidated to be paid when the Fund had sufficient money. Besides, Resolution S.E. 943/03
stipulated that financial claims consolidated against the Stabilization Fund, with due date
conditioned to further definition, did not constitute liquid and receivable debt and would be
adjusted according to later arrangements, taking as reference the returns which the Stabilization
Fund would have had if it had had sufficient resources. Besides, Resolution SE 406/03 introduces
an order of priority for the payment of returns from sales in the Spot Market. Payments
outstanding are consolidated monthly. This ‘temporary’ resolution is still in force.
• Resolution S.E. 1281/06. This resolution defines supply priorities depending on the restrictions
which might arise. It stipulates an increase in rates for big consumers on any difference in their
consumption above their 2005 demand. It defines the so-called Energy Plus, which must be
contracted for in order to satisfy the demands of: (i) big users above their 2005 demand and (ii)
the total consumption of a new big demanding agent. This energy will have a price higher in a
50% to 100% than the one defined for the seasonal price approved for big consumers. Finally,
Resolution S.E. 1281/06 deepens the restriction to the freedom of contract granted by the MRE to
generator agents.
This way, the impact of these resolutions on CEMPPSA´s economic-financial equation may be
summarized as follows:
A) Reduction of the rates which pay for the energy sold
CEMPPSA constructed the Potrerillos facilities investing a sum superior to U$S 312,000,000 (three
hundred and twelve million US dollars), including contributions from the Province and capital
contributions and financing from the private investors. The Project expected the repayment of the
contributions made by CEMPPSA´s private stakeholders via the funds generated from the sale of energy
produced by the Project itself throughout the concession period, which is 25 years. For this to happen, the
energy produced was supposed to be sold in a de-regulated market, which would ensure that final prices
and rates would fluctuate according to the norms of supply and demand, and keeping a reasonable
coherence with the generation rates of other countries in the region. Once the main investments had been
made, at the beginning of 2002, pesification of contracts came about and, from that moment on, a
management of rates which was not according to the investments made. Rates actually remunerated
represent for the period 2002–2006 only 25% to 65% of the rate estimated in the proposal.
B) Retentions brought about by the application of Resolution S.E. 406/03.
Due to CEMPPSA´s type of power stations and the manner in which their energy was contracted for at
the moment this and other related norms were introduced, this concessionaire is one of the most affected
by their effect. The application of the referred resolution would cause the firm to collect only
approximately from 20% to 40% of their sales in the MEM. This percentage was increased to the 60%
thanks to a preventive measure lodged by CEMPPSA. In spite of this, the application of this resolution,
which was originally introduced on a temporary basis, has caused the Stabilization Fund managed by
CAMMESA to owe CEMPPSA, in February 2007, a sum of about fifty four million pesos (which would
amount to, at an exchange rate of $3,10/U$S, about U$S 17,400,000 (seventeen million four hundred US
dollars) plus the corresponding interest. In addition to all this, if we take into consideration that (i) there is
no certain date as to when the application of this ‘temporary’ resolution will be annuled, that (ii) there is
no guarantee as to the commencement date of payment of the debt consolidated by this resolution and that
(iii) the prices collected are much lower than those originally proposed, it is clear that CEMPPSA´s
revenues have had a marked unbalance.
C) Impossibility to make contracts in the Forward Market (MAT)
Finally, the impossibility to make contracts in the Forward Market deprives CEMPPSA of a right the
MRE did grant them, under the regulations, to enter into such contracts as they deemed appropriate,
convenient or palliative of the damage caused by, for example, the existence of resolutions such as 406/03
and 1281/06.
Sensitivities
The chart below shows the results of the sensitivities:

Original Flow 1995: IRR 14.0%

Adjusted Original Flow (2002): IRR 10.5%
Parameters Variation IRR

Realized values up to Realized rates and costs up to 2006 and
10.98%
2006 Flows estimated in 2002 for the rest of the period
Realized values up to 2006
11.74%
+10% with respect to values estimated in 2002
Rate
10.27%
-10% with respect to values estimated in 2002
11.74%
+10% with respect to values estimated in 2002
Generation
10.27%
10.81%
Operation and Maint. +10% with respect to values estimated in 2002
Costs Realized values up to 2006
11.20%
Rate and Generation: +10% 12.65%
Operation and Maint.
O & M Costs: -10%
Rate, Generation
and Costs
Rate and Generation: -10% 9.15%
O & M Costs: +10%
Discount Rate 21% (VAN) $ (44.88)
What emerges from the foregoing analysis is that the assertion that the project is not financially viable is a
sound one when faced with variations in different key parameters and that, therefore, revenues derived
from the sale of emission reductions are fundamental to achieve the sustainability of operations in the
long term.
Step 4. Common practice analysis

Sub-step 4a. Analyze other activities similar to the proposed Project activity
a) Argentine Energy Matrix
Figure 5 shows the components of the Argentine Energy Matrix (2005): Natural Gas (50% of the total
matrix), Oil (38%), Renewable Energies (8%), Nuclear Energy (3%) and Mineral Coal (1%).
The hydraulic power is within Renewable Energies accounts for 5% of the total Energy Matrix of the
country.
Matriz Energética Argentina

- 2005 -
Fuente: Secretaría de Energía
Figure 6. Argentine Energy Matrix (2005)
- Petróleo: Oil
- Gas atural: atural Gas
- Carbón Mineral: Coal
- Renovables: Renewable Energies
- uclear: uclear Energy
- Energía Hidráulica: Hydraulic Energy
- Leña: Firewood
- Bagazo: Bagasse
- Otros Primarios: Other Commodities
- Fuente: Secretaría de Energía - Source: Energy Secretariat
As regards electric power generation in particular, figure 6 shows the distribution of the electric power
generation in the country, where thermal energy represents 54%, hydro power, 39%, and nuclear energy,
7%. These data gives and idea of the tendency to generate more thermal energy these days, something
which not only represents a significant source of atmospheric pollution, but also creates higher operation
and maintenance costs in the initial stages of the project, compared with a hydroelectric power station.
Participación de la Generación de la Energía

- 2005 -
Hidráulico
39%
Térmico
54%
Nuclear
7%
Fuente: CAMMESA
Figure 7. Distribution of Power Generation (2005)
- Térmico: Thermal
- Hidráulico: Hydraulic
- uclear: uclear
- Fuente: Source
b) Geographic division and main hydroelectric power stations in the country
As shown on CAMMESA20`s 2004 annual report, 42% of the country´s hydro power is generated at the
Comahue River Basin which comprises Argentine geographic areas of the provinces of La Pampa,
Neuquén and Río Negro. 37% is generated at the Yacyretá hydroelectric plant and 9% at the Salto Grande
Joint Technical Committee. Fourth comes the Cuyo region –which this project belongs to—and finally,
the Northeast Argentine region and the Central region.
Figure 7 summarizes the distribution of hydraulic generation among the main hydroelectric power
stations in the country:
20
CAMMESA´s 2004 Annual Report
Participación de la Generación Hidráulica

- 2004 -
NOA
2% P.P. Leufú Diamante
4% 2%
Centro
2% P. Banderita Nihuil Otros
3% 3% 7%
Cuyo Cuenca Yacyretá
8% Comahue* Alicurá 37%
42% 7%
Yacyretá El Chocón
37% 11%
CTM Salto Salto
P del Águila Grande Arg
Grande
17% 9%
9%
Fuente: CAMMESA
*Incluye: Alicurá, Piedra del Águila, Pichi Picún Leufú, El Chocón, Arroyito, Planicie Banderita, El Chañar
Figure 8. Distribution of Hydraulic Generation (2004)
- OA: orthwest Argentina
- Centro: Central Region
- Cuenca Comahue: Comahue River Basin
c) Historical Background of Argentine hydroelectric power stations
Unlike the Potrerillos Project, the rest of the hydroelectric power stations in Argentina were built by the
State, mostly by the National State. However, the exploitation rights of a large part thereof have been
granted to private agents. Salto Grande and Yacyretá are examples of hydroelectric power stations that
are still operated directly by the State.
The historical evolution of the sources of electricity supply in Argentina shows a reasonable balance
between thermal and hydraulic generation until the mid 90s, as a result of large hydroelectric exploitation
undertakings promoted by the National State through the companies “Agua y Energía” and “Hidronor”
during the 60s, 70s, 80s and part of the 90s.
As of 1995, the construction of new hydro power stations came to a halt and power generation with gas
turbines increased.
During the period from the 60s to the first part of the 90s, the State´s efforts made it possible to finance
hydro projects including dams, in some cases through the investment of funds from the National
Treasury, and in other cases, especially during the second half of said period, through the aid of
international funding organizations.21
The market policies of the 1990s brought about the privatization of a large number of hydroelectric plants
located within the national territory.
21
Ernesto Ortega, Eng. “Financing Dam Engineering in Argentina”, IV Argentine Conference on Dams and
Hydroelectric Exploitation Projects. Province of Misiones. August 17-19, 2006.
Sub-step 4b. Discuss any similar options that are occurring
There are two factors differentiating the Potrerillos Project from the rest of the hydroelectric power
stations in Argentina:
1. The moment when it is built, and then, the moment when it starts receiving revenues.
2. The type of Private-State Participation selected.
Both factors are explained below:
1. The moment when it is built, and then, the moment when it starts receiving revenues.
The concessions of the hydroelectric power stations mentioned in Sub Step 4a began –in general and
differently from the Concession of the Potrerillos Project—during the first years of the 1990s. Without
doubt, starting up in a period when the Argentine economy was experiencing genuine growth allowed
those concessionaires to get acceptable return on their investments (whether in the form of new projects
or through the payment of the initial charges to accede to the referred concessions). The context was
different for the Potrerillos Project since the building works began in a pre-crisis period but Project
started generating returns (to meet its obligations) in a post-crisis period. It is clear that we are comparing
projects with very different context conditions.
Thus, after the Argentine crisis of December 2001, the new emerging economic regulations, and the
situation of electricity rates in the country prevented the construction of new hydroelectric power stations
until 2005.
After the passing of Law 25.561 in January 2002 regarding Public Emergency and the Foreign Exchange
Regime Reform, the country was declared to be under public emergency in relation to social, economic,
administrative, financial and foreign exchange matters. Under Section 8 of the referred law, adjustment
clauses in dollars or in other foreign currencies, indexation clauses based on foreign price indexes and any
other indexation mechanism contained in contracts entered into by the Public Administration under public
legal regulations, including those contracts involving public works and services, became null and void.
The study Hydroelectricity in Argentina22 undertaken by the Carlos Bohoslavsky, (Engineer from ACE –
Foreign Trade Consultants), Eduardo Liaudat (Engineer from Proa S.R.L. –Associated Professionals) and
Ernesto Ortega (Engineer from ORSEP –Dam Safety Regulatory Organism) and presented at the IV
Argentine Conference on Dams and Hydroelectric Exploitation Projects held in the Province of Misiones
in 2006 states that the “freezing” of public service rates by the State, whose aim has gone far beyond the
control of inflation or the transition from convertibility to devaluation, has distorted the economic
situation, discouraging genuine investments in power generation (both thermal and hydraulic).”23
Therefore, after the crisis, no investments have been made in power generation due to the absence of an
economic context and a legal and institutional framework that would provide security to this type of
initiatives.
According to the report mentioned above, at present and broadly speaking, there are not any building
companies capable of facing significant power generation projects. The companies that currently supply
22
http://www.cadp.org.ar/congreso/docs/trabajos/T_A10.pdf
23
Carlos Bohoslavsky, Eng., Eduardo Liaudat, Eng. and Ernesto Ortega, Eng. Hydroelectricity in Argentina. IV
Argentine Conference on Dams and Hydrolectric Exploitation Projects. Province of Misiones. August 17-19, 2006.
hydroelectric and mechanical equipment have survived thanks to their supply to foreign projects. The
country has not developed its own control mechanisms at the national level, consultancy in Argentina has
resorted to other areas that are not related to dams, and the State´s role has been reduced to regulator. Said
document points out that “It must be considered that at present the MEM (Argentine Wholesale Electric
Market) generators are granted a monomial rate of around 0.020 U$S/KWh and the average costs of
thermal and hydro generation are over 0.025 to 0.030 U$S/KW”.
Consequently, due to this reduction observed in the sector, dealing with funding issues does not only
require a lot of creativity to make each project individually profitable but it must also provide the
resources for the creation of a dam industry in Argentina through a sound financial plan that promotes
investment in training, research and capitalization of fixed assets, including the new sustainability and
security requirements demanded by society.
To conclude, in Argentina´s present context, human resources, capital, companies, suppliers and financial
resources are insufficient to help recover the sector devoted to dam construction and operation and their
corresponding hydroelectric power stations.
2. The type of Private-State Participation selected
As the Ernesto Ortega (Engineer, ORSEP member)24 sustains, “Many formulas have been attempted
worldwide to solve the problem of funding public initiatives, particularly dam construction. Each context
is different, so it is not always possible to apply a model from one latitude to another, no matter how
successful it may have been. It is important to know about previous experiences in the application of a
model in order to learn from them.”
In the case of the Potrerillos Project, the BOT system (Build-Operate-Transfer) was chosen whereby a
private company finances, builds, operates the concession and transfers the Project to the State at the end
of the concession period. It is worth mentioning that this is the first case in the country with this type of
financing.
It is common practice worldwide in BOT-type projects, that the developer, in this case, CEMPPSA,
gather the necessary sources to make the initial investment by using a combination of equity and project
finance (long-term credit taken and repaid by the Project itself). Commonly a 20% to 30% of the
necessary total in equity and the rest in project finance.
In this way, CEMPPSA drew up the business plan submitted to the Province of Mendoza during the
corresponding bidding process. Due to the national economic crisis which affected this Project and
considering that after the end to convertibility in 2002, the essence of the Project changed, CEMPPSA
struggled to obtain the referred “Project Finance”. Without doubt, this new and initially unexpected
situation had a profound negative impact on CEMPPSA´s economy, and that of its creditors and sponsors.
24
Ernesto Ortega, Eng. Financing Dam Engineering in Argentina, IV Argentine Conference on Dams and
Hydroelectric Exploitation Projects. Province of Misiones. August 17-19, 2006. This document can be accessed at
http://www.cadp.org.ar/congreso/docs/trabajos/T_A9.pdf
Step 5. Impact of CDM registration
This Project, as mentioned on Mercau and Ontiveros´s report “Application of Green Credits to the
Potrerillos Project”, due to its nature and inherent characteristics, contributes to the reduction of carbon
dioxide emissions since electricity generated from fossil fuels is displaced by electricity generated from a
renewable source.
It is important to remember that more than half of the power stations in the country operate using thermal
sources. They are more attractive in so far as the return on investment is concerned, but their operation
costs are high and they are considerable sources of emission of CO2 and other gases.
This way, with the Potrerillos Project in operation, CO2 emissions are reduced since demand is met and it
is not necessary to resort to the operation of thermal stations.
Step 2 developed in this section described how the changes that the political, economic and financial
crisis caused in CEMPPSA´s cash flows would turn the Potrerillos Project into a financially unviable
undertaking in the long term, resulting in a lower IRR than that required by investors in order to finance
the Project.
As explained before, in this context, it is necessary to find mechanisms which can restore –at least,
partially—the Project´s initially estimated profitability in order to make it a sustainable undertaking in the
long term, both for society as a whole and for those who committed themselves to it.
Adjusted flow and CERs in 2002

Mercau and Ontiveros used the following data in 2002 to calculate the benefits of green credits:
As explained in previous sections, the differential generation obtained by the CDM project equals
454.291MWh per year.
The emission factor of the Argentine electric grid is estimated to be approximately 450-500 tons
of equivalent CO2 /GWh.
U$S 13 is the average net price estimated per ton of equivalent CO2. This price is set taking into
account the present market price of green credits, minus possible limitations as regards the
acceptance thereof by the countries in Annex 1 that are in a position to acquire them.
The combination of these three values results in an annual flow from the sale of green credits of
U$S2,885,987.
Project IRR with CERs (2002) Benchmark
12.80 % < 14%
By incorporating green credits, the Project´s IRR amounts to 12.80%, coming close to the “hurdle”
previously mentioned. In this sense, it is clear that the incorporation of green credits is vital to support the
Project`s operation and to face the assumed financial commitments.
In this way, the incorporation of additional flows obtained from the sale of CERs improves the viability
of the Project by increasing the IRR up to 12.80%.
Within this context marked by the end to convertibility, pesified rates and debts run up in dollars,
CEMPPSA´s management decided to take additional investment risks to finish the works they had
engaged in, as well as those risks related to the Project´s operation, using their own funds after
considering the benefits associated to a CDM project in their profitability analysis.
In this respect, Mercau and Ontiveros´s report concludes that, considering the cash inflow obtained from
the sale of CERs, CEMPPSA´s financial and economic situation has taken a more favorable turn, facing a
scenario in which there is no need to find new solution alternatives.
As a conclusion, the implementation of this Project activity within the framework of the Clean
Development Mechanism would enable an increase in the Project´s IRR and would make it viable in the
long turn.
As it has been explained so far, the Potrerillos Project is considered to comply with the additionality
criterion that enables its implementation as a Project activity within the CDM framework.
B.6. Emission reductions:
B.6.1. Explanation of methodological choices:
Methodology ACM0002/version 06 is the chosen for this Project (May 19, 2006)
This Project activity complies with the applicability conditions established by this methodology for the
reasons set forth below:
• It applies to electricity generation capacity additions from:
− Run-of-river hydro power plants; hydro power projects with existing reservoirs where the volume of
the reservoir is not increased
− New hydroelectric power plants with reservoirs having power densities (installed power generation
capacity divided by the surface area at full reservoir level) greater than 4 W/m2
− Wind sources
− Geothermal sources
− Solar sources
− Wave and tidal sources
renewable energy at the site of the project activity, since in this case the baseline scenario would be
the continued use of fossil fuels at the site.
• Both the geographic project boundaries and those of the relevant electricity grid must be clearly
identified, and information on the characteristics of the grid must be available.
In addition, this section presents a summary of the methodological options chosen for the calculation of
the baseline:
Step 1: Calculation of the Operation Margin Emission Factor. Method “c”, Dispatch Data Analysis, has
been applied.
Step 2: Calculation of the Build Margin Emission Factor. Option 1 calculation ex –ante has been chosen.
Option 1. Calculate the Build Margin emission factor (EFBM) ex-ante based on the most recent
information available on plants already built for sample group m at the time of PDD submission.
The sample group m consists of:

- the five plants most recently built or,
- the power plant capacity additions in the electricity system that comprise 20% of the system
generation (in MWh) and that have been built most recently.
In this Project, the group of plants m consists of those plants comprising 20% of the most recent capacity
additions to the system, since, based on the comparison between both options, this is the one that involves
a greater amount of energy (this information is shown in detail in Annex 3).
. Data and parameters that are available at validation:
Data / EGhistorical
Parameter:
Data unit: GWh/year
Description: The average of historical generation of existing power stations during five years prior
to the implementation of the Project.
Source of data on-site measurement
used:
Value applied: Power Years
Justification of the Stations 1996 1997 1998 1999 2000 Average
choice of data or Álvarez
description of 128.752 124.398 121.226 121.407 129.612 125.079
Condarco
measurement Old
methods and Cacheuta 59.409 58.358 61.743 57.578 63.677 60.153
procedures
actually applied
Description on-site electricity meter
Any comment: The five-year period used to obtain the average of historical generation extends from
1996 to 2000 and constitutes the last and most representative five-year period in the
historical generation data of the old Álvarez Condarco and Cacheuta Stations, since as
of 2001 the generation began to be affected by the building works of the Potrerillos
Project. (For example, there was not electricity generation at the old Cacheuta Station
between May and October, nor was there generation at the Álvarez Condarco Station
between May and September of the same year).
Data / Parameter: Mineral Coal Emission Factor

Data unit: tCO2/t Mineral Coal
Description: Mineral Coal Emission Factor
Source of data used: IPCC, 1996
Value applied: 2.54
Justification of the Said value has been chosen following the methodology AMC0002/Version 06
choice of data or recommendations
description of
measurement methods
and procedures actually
applied :
Any comment:
Data / Parameter: Fuel Oil Emission Factor

Data unit: tCO2/t Fuel Oil
Description: Fuel Oil Emission Factor
Value applied: 3.44
description of
measurement methods
applied :
Any comment:
Data / Parameter: Natural Gas Emission Factor

Data unit: tCO2/Dam3 Natural Gas (cubic dekameter)
Description: Natural Gas Emission Factor
Value applied: 2.10
description of
measurement methods
applied :
Any comment: -
Data / Parameter: Gas Oil Emission Factor

Data unit: tCO2/t Gas Oil
Description: Gas Oil Emission Factor
Value applied: 3.36
description of
measurement methods
applied :
Any comment: -
Data / Parameter: Operational lifetime of Unit 1 (Original Maximum Capacity 13.7 MW) of the
Álvarez Condarco Station
Data unit: Years
Description: Operational lifetime of Unit 1 (Original Maximum Capacity 13.7 MW) of the
Álvarez Condarco Station that has been repowered due to the CDM Project
activity
Source of data used: Technical documents
Value applied: 45 years
Justification of the Machinery 1 with an Original Maximum Capacity of 13.7 MW that belongs to
choice of data or the Álvarez Condarco Station had started operations in 1955. The unit´s
description of operational lifetime was estimated to be 45 years approximately, so it was
measurement methods supposed to be replaced in 2000 –in absence of the CDM Project—by another of
and procedures actually the same characteristics. Due to the CDM Project activity, during the year 2001,
applied : this unit was repowered to a Maximum Capacity of 15.2 MW, extending its
operational lifetime to 75 years.
Any comment: -
Data / Parameter: Operational lifetime of Unit 2 (Original Maximum Capacity 13.7 MW) of the
Data unit: Years
Description: Operational lifetime of Unit 2 (Original Maximum Capacity 13.7 MW) of the
Álvarez Condarco Station that has been repowered due to the CDM Project
activity
Value applied: 45 years approximately
Justification of the Machinery 2 with an Original Maximum Capacity of 13.7 MW that belongs to
choice of data or the Álvarez Condarco Station had started operations in 1955. The unit´s
description of operational lifetime was estimated to be 45 years approximately, so it was
measurement methods supposed to be replaced in 2000 –in absence of the CDM Project—by another of
and procedures actually the same characteristics. Due to the CDM Project activity, during the year 2001,
applied : this unit was repowered to a Maximum Capacity of 15.2 MW, extending its
operational lifetime to 75 years.
Any comment: -
Data / Parameter: Operational lifetime of Unit 1 (Original Maximum Capacity 3 MW) of the old
Cacheuta Station.
Data unit: Years
Description: Operational lifetime of Unit 1 (Original Maximum Capacity 3 MW) of the old
Cacheuta Station that has been replaced due to the CDM Project activity
Justification of the Machinery 1 with an Original Maximum Capacity of 3 MW that belongs to the
choice of data or old Cacheuta Station had started operations in 1926. The unit´s operational
description of lifetime was estimated to be 76 years approximately, so it was supposed to be
measurement methods replaced in 2002 –in absence of the CDM Project—by another of the same
and procedures actually characteristics. Due to the CDM Project activity, this machine has been replaced
applied : by a new unit situated in the new building of the Cacheuta Nueva Station, with a
Maximum Capacity of 31.60 MW.
Any comment: -
Cacheuta Station.
Data unit: Years
Any comment: -
Cacheuta Station.
Data unit: Years
Any comment: -
B.6.3 Ex-ante calculation of emission reductions:
Below are shown in detail the equations used in the calculation of emission reduction, as well as the
justifications for the use of each of the options set by the methodology ACM0002/Version 06 used in the
calculation of the Project emissions, baseline emissions, fugitive emissions and reduction emissions in
this Project activity.
Baseline emissions
STEP 1. Calculate the Operating Margin emission factor(s) (EFOM,y) based on Dispatch Data Analysis
OM. The Dispatch Data OM emission factor (EFOM,Dispatch Data,y) is summarized as follows:
Where EGy is the generation of the project (in MWh) in year y, and EOM.y are the emissions (tCO2)
associated with the operating margin calculated as:
Where EGh is the generation of the project (in MWh) in each hour h and EFDD,h is the hourly generation
weighted average emissions per electricity unit (tCO2/MWh) of the set of power plants (n) in the top 10%
of grid system dispatch order during hour h:
Where F i,n, h is the amount of fuel i (in a mass or volume unit) consumed by the set of plants n calculated
on an hourly basis h for the set of plants falling within the top 10% of the system dispatch. To determine
the set of plants (n), obtain from a national dispatch center:
a) The grid system dispatch order of operation for each power plant of the system; and
b) The amount of power (MWh) that is dispatched from all plants in the system during each hour that the
project activity is operating (GEh). At each hour h, stack each plant’s generation (GEh) using the
merit order. The set of plants (n) consists of those plants at the top of the stack (i.e., having the least
merit), whose combined generation (Σ GEh) comprises 10% of total generation from all plants during
that hour (including imports to the extent they are dispatched).
COEFi,n is the CO2 emission coefficient of fuel i (tCO2 / mass or volume unit of the fuel), taking into
account the carbon content of the fuels used by the set of plants falling within the top 10% of the system
dispatch and the percent oxidation of the fuel in year(s) y, and
ΣGEn,h comprises 10% of total generation from all plants during that hour (MWh)
The CO2 emission coefficient COEFi is obtained as:
Where:
NCVi Is the net calorific value (energy content) per mass or volume unit of a fuel i,
OXIDi Is the oxidation factor of the fuel (see page 1.29 in the 1996 Revised IPCC
Guidelines for default values),
EFCO2,i Is the CO2 emission factor per unit of energy of the fuel i.
STEP 2. Calculate the Build Margin emission factor (EFBM,y) as the generation-weighted average
emission factor (tCO2/MWh) of a sample of power plants m, as follows:
Where
Fi ,m y Is the amount of fuel i (in a mass or volume unit) consumed by relevant power
sources m in year(s) y, m refers to the power sources delivering electricity to the
grid, not including low-operating cost and mustrun power plants, and including
imports to the grid,
COEFi,m Is the CO2 emission coefficient of fuel i (tCO2 / mass or volume unit of the
fuel), taking into account the carbon content of the fuels used by relevant power
sources m and the percent oxidation of the fuel in year(s) y, and
GEm,y Is the electricity (MWh) delivered to the grid by source m.
As it was explained in section B.4, Option 1 has been chosen for this Project, where the Build Margin
Emission Factor is calculated ex ante based on the available information from the most recently built
plants for a group of plants m at the moment of submitting the project document.
STEP 3. Calculate the baseline emission factor EFy as the weighted average of the Operating Margin
emission factor (EFOM,y) and the Build Margin emission factor (EFBM,y):
Where the weights wOM and wBM, by default, are 50% (i.e., wOM = wBM = 0.5), and EFOM,y and EFBM,y are
calculated as described in Steps 1 and 2 above and are expressed in tCO2/MWh.
The following chart shows the results obtained from the previous equations (Annex 3 shows the
calculations in detail):
Step 1 = EFOM tCO2/MWh Step 2 = EFBM Tco2/MWh Step 3 = EF tCO2/MWh

0.60023029 0.37711000 0.48867015
Emission Reduction (ERy)
Once the emission factor of the electricity grid to which this Project belongs has been calculated, the
emission reductions associated to the Project can be calculated. According to equation 11, the emission
reductions of the Project activity during year y (ERy in tCO2) is the same as the baseline emissions
during year y (BEy in tCO2) minus the Project emissions during year y (PEy in tCO2 ) and the fugitive
emissions in year y (Ly in tCO2).
Where the baseline emissions (BEy in tCO2) are the product of the baseline emissions factor (EFy in
tCO2/MWh) calculated in Step 3, times the electricity supplied by the project activity to the grid (EGy in
MWh) minus the baseline electricity supplied to the grid in the case of modified or retrofit facilities (EG
baseline in MWh), as follows:
Equation 12 is only applied to the already existing units at the Álvarez Condarco and the old Cacheuta
Stations (baseline scenario 2, see section B.4). The following chart shows the generation units and the
power generation involved in the calculation. It is worth pointing out that in the particular case of the
Álvarez Condarco Station, the energy considered as the CDM Project energy (EGy) is that resulting from
the repowering of Units 1 and 2.
This means that, for said units, the energy involved in the baseline is greater than that of the Project (as
the Project energy only consists in the difference produced by the repowering).
According to equation 12, the baseline emissions (BEy) result from the difference between the energy
generated by the CDM Project (EGy) and the baseline energy (EGbaseline), all of it depending on the
emission factor. As the first term will always be lower than the second, the result obtained for these units
is negative, as observed in the first cell of the last column of the table below:
Hydroelectric Power EGbaseline Egy Emission Factor BEy MWh/year

Station MWh/year MWh/year CO2/MWh
Álvarez Condarco Power 125.079 116.497 0.4886701 -4.194
Station Units 1 and 2
Cacheuta Power Station 60.153 294.694 0.4886701 114.613
Units 1, 2 and 3
Total 185.232 411.191 110.419
In the case of the new generation units corresponding to baseline scenario 1 (see section 4.B). The
following chart shows the generation units and the power generation involved in the calculation:
Hydroelectric Power EGy MW/h Emission Factor BEy MWh/year

Station CO2/MWh
Álvarez Condarco Power 113.115 0.4886701 55.276
Station Unit 3
Cacheuta ueva Power 115.217 0.4886701 56.303
Station Unit 4
Total 228.332 111.579
Below is shown the total BEy value of the Potrerillos Project resulting from the addition of EGy between
both scenarios:
Year EG y MWh EGbaseline Emission Factor BE y Tco2

MWh CO2/MWh
2007 639.523 185.232 0.4886701 221.999
2008 639.523 185.232 0.4886701 221.999
2009 639.523 185.232 0.4886701 221.999
2010 639.523 185.232 0.4886701 221.999
2011 639.523 185.232 0.4886701 221.999
2012 639.523 185.232 0.4886701 221.999
2013 639.523 185.232 0.4886701 221.999
2014 639.523 185.232 0.4886701 221.999
2015 639.523 185.232 0.4886701 221.999
2016 639.523 185.232 0.4886701 221.999
2017 639.523 185.232 0.4886701 221.999
2018 639.523 185.232 0.4886701 221.999
2019 639.523 185.232 0.4886701 221.999
2020 639.523 185.232 0.4886701 221.999
2021 639.523 185.232 0.4886701 221.999
2022 639.523 185.232 0.4886701 221.999
2023 639.523 185.232 0.4886701 221.999
2024 639.523 185.232 0.4886701 221.999
2025 639.523 185.232 0.4886701 221.999
2026 639.523 185.232 0.4886701 221.999
2027 639.523 185.232 0.4886701 221.999
The following table shows the values resulting from applying equation 11, by means of which the
emission reductions of the Project are calculated (ERy).
Year BE y tCO2 PE y Tco2eq/year Ly tCO2/MWh ER y tCO2/MWh

2007 221.999 0 0 221.999
2008 221.999 0 0 221.999
2009 221.999 0 0 221.999
2010 221.999 0 0 221.999
2011 221.999 0 0 221.999
2012 221.999 0 0 221.999
2013 221.999 0 0 221.999
2014 221.999 0 0 221.999
2015 221.999 0 0 221.999
2016 221.999 0 0 221.999
2017 221.999 0 0 221.999
2018 221.999 0 0 221.999
2019 221.999 0 0 221.999
2020 221.999 0 0 221.999
2021 221.999 0 0 221.999
2022 221.999 0 0 221.999
2023 221.999 0 0 221.999
2024 221.999 0 0 221.999
2025 221.999 0 0 221.999
2026 221.999 0 0 221.999
2027 221.999 0 0 221.999
Project Emissions (PEy)
Although most of the renewable power generation projects can be considered to have zero emission, the
methodology ACM0002/Version 06 states in item II that the new hydroelectric power projects with a
reservoir must take into account the project emissions on the basis of its power density.
Said density is calculated through the coefficient between the installed generation capacity and the
surface area at full reservoir level. The steps of this calculation as well as the data of this Project activity
are summarized in the following table:
Hydroelectric Power Baseline Scenario Potrerillos Project CDM Project

Station (without CDM Project) Maximum Installed Maximum Installed
Maximum Installed Capacity MW Capacity MW
Capacity MW
Cacheuta 9 126.40 117.40
Álvarez Condarco 27.4 54.94 27.54
Total 36 181 144.94
Maximum Capacity (W) 144.940.000
Full Reservoir Level (m2) 13.000.000
Power Density 11.1492
According to methodology stipulations, only when the power density of the Project is greater than 4
W/m2 and lower or equivalent to 10 W/m2 the project emissions must be calculated (according to equation
15b).
What emerges from the previous calculations carried out for the Potrerillos Project is that the its power
density is 11.1492 W/m2. Thus, according to item b section II, if the power density of the project is
greater than 10 W/m2 then the project emissions must be considered zero.
PEy = 0 tCO2eq/year
Equations (13), (14) and (15a) of the methodology ACM0002/Version 06 are only used for project
activities that involve geothermal power generation and therefore, do not apply to this Project activity.
Fugitive Emissions (Ly)
Finally, according to methodology ACM0002/Version 06, the project participants do not need to consider
fugitive emissions. Then:
Ly = 0 tCO2/MWh
Project activities using this baseline methodology shall not claim any credit for the project on account of
reducing these emissions below the level of the baseline scenario.
B.6.4 Summary of the ex-ante estimation of emission reductions:
This Project´s annual average of emission reductions has been estimated in approximately 221,998.53
tCO2eq.
The following chart summarizes the emission reductions estimate for the Potrerillos Project during a
crediting period of 7 renewable years (21 years altogether):
Baseline Emission Project Leakage Emission

Year (tCO2/year) Emission (tCO2/year) Reduction
(tCO2/year) (tCO2/year)
2007 221.998,53 0 0 221.998,53
2008 221.998,53 0 0 221.998,53
2009 221.998,53 0 0 221.998,53
2010 221.998,53 0 0 221.998,53
2011 221.998,53 0 0 221.998,53
2012 221.998,53 0 0 221.998,53
2013 221.998,53 0 0 221.998,53
2014 221.998,53 0 0 221.998,53
2015 221.998,53 0 0 221.998,53
2016 221.998,53 0 0 221.998,53
2017 221.998,53 0 0 221.998,53
2018 221.998,53 0 0 221.998,53
2019 221.998,53 0 0 221.998,53
2020 221.998,53 0 0 221.998,53
2021 221.998,53 0 0 221.998,53
2022 221.998,53 0 0 221.998,53
2023 221.998,53 0 0 221.998,53
2024 221.998,53 0 0 221.998,53
2025 221.998,53 0 0 221.998,53
2026 221.998,53 0 0 221.998,53
2027 221.998,53 0 0 221.998,53
Total 4,661,969.14
B.7 Application of the monitoring methodology and description of the monitoring plan:
The Monitoring Plan of the Potrerillos Project has been developed according to the parameters stipulated
by the Monitoring Methodology ACM0002/Version 06 “Consolidated monitoring methodology for zero-
emissions grid-connected electricity generation from renewable sources”.
Version: 06
Sectorial Scope: 01
Date: May 19, 2006
The Potrerillos Project uses this methodology because it complies with the applicability conditions
mentioned below:
• It applies to electricity capacity additions from:
− Run-of-river hydropower plants; hydropower projects with existing reservoirs where the volume of
the reservoir is not increased.
− New hydroelectric power projects with reservoirs having power densities (installed power generation
capacity divided by the surface area at full reservoir level) greater than 4 W/m2.
− Wind sources;
− Geothermal sources;
− Solar sources;
− Wave and tidal sources.
renewable energy at the site of the project activity, since in this case the baseline may be the
continued use of fossil fuels at the site;
• The geographic and system boundaries for the relevant electricity grid can be clearly identified and
information on the characteristics of the grid is available; and
As it was stated by the Monitoring Methodology ACM0002/Version 06, the main variables to be
determined are:
• Electricity generation from the proposed project activity;

• Necessary data to recalculate the emission factor, based on the calculation of the Operating Margin
and the Build Margin, consistent with the selected option according to the calculation methodology
“Consolidated baseline methodology for grid-connected electricity generation from renewable
sources” (ACM0002);
• For new hydroelectric power projects, the surface area of reservoir at the full reservoir level shall be
monitored.
Project Boundary
1) Consistent with the “Consolidated baseline methodology for grid-connected electricity generation from
renewable sources” (ACM0002/v06) the project boundary includes the following emissions sources:
• For new hydroelectric projects with reservoirs, the project boundary includes the physical site of
the plant as well as the reservoir area.
For the baseline determination, project participants shall only account CO2 emissions from electricity
generation in fossil fuel fired power that is displaced due to the project activity.
2) The spatial extent of the project boundary includes the project site and all power plants connected
physically to the electricity system that the CDM project power plant is connected to.
The Monitoring Plan of the Potrerillos Project –which is part of the CDM Project—provides the
systematic procedures for the continuous measurement of all the parameters stated by the applied
monitoring methodology.
B.7.1 Data and parameters monitored:
Data / Parameter: EGh

Data unit: MWh
Description: Electricity supplied to the grid by the project
Source of data to be Measured by CAMMESA
used:
Value of data applied Year 2005 Álvarez Condarco Cacheuta ueva
for the purpose of 59.827
calculating expected Group 1 95.849
emission reductions in Group 2 56.671 79.081
section B.5 Group 3 113.115 119.764
Group 4 - 115.217
Total per
229.612 409.912
station
Total 639.523
Potrerillos
Description of Hourly measurement and monthly recording
measurement methods
and procedures to be Electricity supplied by the project activity to the grid. Double check by receipt of
applied: sales.
QA/QC procedures to These data will be directly used for calculation of emission reductions. Sales
be applied: records to the grid and other records are used to ensure the consistency.
Any comment: This data must be kept during the crediting period and two years after
Data / Parameter: EFy

Data unit: tCO2 /MWh
Description: CO2 emission factor of the grid
Source of data to be Calculated with ACM0002/versión 6
used: Source: CAMMESA
Value of data applied 0.48861015
for the purpose of
calculating expected
emission reductions in
section B.5
Description of Calculated as a weighted sum of the OM and BM emission factors
measurement methods
and procedures to be
applied:
QA/QC procedures to Default data (for emission factor) and IEA statistic (for energy data) are used to
be applied: check the local data.
Data / Parameter: EFOM,y

Description: CO2 Operating Margin Emission Factor of the grid
Source of data to be Calculated with ACM0002/version 6
for the purpose of
section B.5
Description of Calculated as indicated in the relevant OM baseline method above
measurement methods
applied:
Data / Parameter: EFBM,y

Description: CO2 Build Margin emission factor of the grid
for the purpose of
section B.5
Description of Calculated as [∑i Fi,y*COEFi] / [∑m GENm,y] over recently built power plants
measurement methods defined in the baseline methodology
applied:
Data / Parameter: Fi,y

Data unit: Mass or volume
Description: Amount of each fossil fuel consumed by each power source / plant
Source of data to be CAMMESA
used:
Value of data applied Please, see Annex 3
for the purpose of
section B.5
Description of Obtained from the dispatch center (CAMMESA)
measurement methods
applied:
Data / Parameter: COEFi

Data unit: tCO2 /mass or volume unit
Description: CO2 emission coefficient of each fuel type i
used: Source: CAMMESA and IPCC
for the purpose of
section B.5
Description of Plant or country specific values to calculate COEF are preferred to IPCC default
measurement methods values.
applied:
Data / Parameter: GENn/h

Data unit: MWh
Description: GENn,h comprises 10% of total generation from all plants during that hour
Source of data to be Calculated with ACM0002/versión 6
used: Source: CAMMESA and IPCC
for the purpose of
section B.5
Description of Obtained from the dispatch center (CAMMESA).
measurement methods
applied:
Data / Parameter: Area

Data unit: m2
Description: Surface area at full reservoir level
Source of data to be On-site measurement
used:
Value of data applied 13.000.000
for the purpose of
section B.5
Description of On-site measurement
measurement methods
applied:
Any comment: At start of the project
This information must be kept during the crediting period and two years after
Data / Parameter: Plant name
Data unit: Text

Description: Identification of power source / plant for the OM
used:
for the purpose of
section B.5
Description of Identification of plants to calculate Operating Margin emission factors
measurement methods
applied:
Any comment: This information must be kept during the crediting period and two years after
Data / Parameter: Plant name

Data unit: Text
Description: Identification of power source / plant for the BM
used:
for the purpose of
section B.5
Description of Identification of plants (m) to calculate Build Margin emission factors
measurement methods
applied:
Data / Parameter: Merit order

Data unit: Text
Description: The merit order in which power plants are dispatched by documented evidence
used:
for the purpose of
section B.5
Description of The Order of Merit for the dispatch of the electric units of the Argentine
measurement methods Wholesale Electric Market (MEM) is established by the Wholesale Electric
and procedures to be Market Managing Company. The information is publicly available through the
applied: company´s web site www.cammesa.com
B.8 Date of completion of the application of the baseline study and monitoring methodology and
the name of the responsible person(s)/entity(ies)
Detailed information on the baseline scenario is presented in Annex 3.

Detailed information on the Monitoring Methodology and Plan is presented in Annex 4.
The analysis of the baseline and monitoring methodology was finished on March 31, 2007.
The baseline analysis was carried out by PricewaterhouseCoopers Argentina.

PricewaterhouseCoopers does not take part in the Project.
Consortium of Mendocinian Companies for Potrerillos Business Corporation (CEMPPSA)

Martín Del Pópolo. Engineer
Commercial Manager
+ 00 54 261 155 114851
+ 0054 261 4819030
+ 0054 261 4819167
mdelpopolo@cemppsa.com.ar
cemppsa@cemppsa.com.ar
PricewaterhouseCoopers – Buenos Aires - Argentina

Sustainable Business Solutions – Climate Change Services
Marcelo Iezzi
marcelo.iezzi@ar.pwc.com
+ 54 11 48506827
www.pwc.com/ar
The Monitoring Plan was developed by PricewaterhouseCoopers Argentina.

PricewaterhouseCoopers – Buenos Aires - Argentina
Sustainable Business Solutions – Climate Change Services
Marcelo Iezzi
marcelo.iezzi@ar.pwc.com
+ 54 11 48506827
www.pwc.com/ar
SECTIO C. Duration of the project activity / crediting period
C.1 Duration of the project activity:
C.1.1. Starting date of the project activity:
April 2002
C.1.2. Expected operational lifetime of the project activity:
The machinery of the Álvarez Condarco and Cacheuta Nueva Power Stations, taking into consideration
their technical characteristics, is estimated to have an operational lifetime longer than seventy- five years.
C.2 Choice of the crediting period and related information:
C.2.1. Renewable crediting period
C.2.1.1. Starting date of the first crediting period:
January 2007
C.2.1.2. Length of the first crediting period:
7 years
C.2.2. Fixed crediting period:
C.2.2.1. Starting date:
Not applicable
C.2.2.2. Length:
Not applicable
SECTIO D. Environmental impacts
D.1. Documentation on the analysis of the environmental impacts, including transboundary

impacts:
The Project “Exploitation of the Mendoza River – Potrerillos Project” has complied with the
Environmental Impact Evaluation Procedure in accordance with the provisions of Provincial Law
No.5961 and of Regulatory Decree Law No.2109/94. The corresponding Environmental Impact
Statement has also been submitted according to the provisions thereof and satisfying the necessary
requirements in order to undergo the statutory technical report and public hearing.
Resolution No.1784/AOP/98 of the Ministry of Environment and Public Works of the Province of
Mendoza authorizes and grants environmental feasibility for construction of the facilities included in the
Project.
The Environmental Impact Report for the Potrerillos Project was carried out by the consultancy firm
Ambiental S.A. with great scientific and technical rigor in every one of the areas under consideration.
Both CEMPPSA and the competent environmental authorities can be assured that the report has complied
with the most rigorous analyses of engineering techniques and shows complete identification with the
national and provincial legal frameworks applicable to the Project. The report confers on the Project
organizers certain rights and prerogatives but also certain obligations in defense of the constitutional right
to a clean and balanced environment which everyone is entitled to.
The most relevant conclusions from the Environmental Impact Statement are listed below:
− The Project of multiple exploitation of the Potrerillos water resources will involve substantial
environmental benefits for the area under study and the reference framework. To start with, the
regulation of the Mendoza River entails a contribution to the supply of potable water, water for
industrial use, for the supply of the Luján de Cuyo Station, and for irrigation. It will also help
mitigate the potential flooding of the Mendoza River valley, and it is a new contribution of non-
polluting energy to the Provincial Electric Market.
− The availability of clear water will contribute to improve irrigation technologies, since the water
will be fit for use in drip or sprinkler irrigation, for example.
− The dam has been built to resist the region´s seismicity conditions and observing all the
construction safety criteria.
− The view of the dam once it was built represents the basis for the evolution of a significant tourist
development.
Development, creation of a tourist center and an additional source of employment and income
This undertaking will contribute to the planned growth of the area and to the efficient use of the water,
which will ensure the economic and social development of the North Oasis.
The fact that it is located at only 45 km from the city of Mendoza as well as its exceptional geographic
surroundings provide the artificial lake resulting from the dam superb possibilities to become a tourist
attraction, which will no doubt foster longer stays on the part of tourists, thus generating an additional
source of income for the Province. At the same time, this will bring about the emergence of new hotels,
restaurants, tourist agencies, new job opportunities and a great many activities that will contribute to
strengthen the regional economy and the welfare of the Mendoza people.
Electric safety
The Potrerillos Project has enabled an increase in the local generation of electric power through the
exploitation of a local source of renewable resources, and with the reduction of the extreme dependence
of the Province for the supply of electricity. Besides, the Project increases the value of other future
hydroelectric projects on the Mendoza River, which will be able to operate more freely as the Project will
act as a ‘compensator’ of the reservoirs located upstream. The generation of the Cacheuta Nueva and
Álvarez Condarco hydroelectric power stations represents 25% of the province´s consumption.
A Boost to Mendoza´s farming and employment

The regulation of the Mendoza River and the greater availability of water in the required time not only
prevent losses in agriculture but they also make it possible to enlarge cultivated areas.
Fluctuations in the streamflow of the Mendoza River –determined by the melting of the snow at the
higher peaks and, partly, of the glaciers- which have caused years of extreme drought (with only 800
Hm3) and years of water abundance (with flows greater than 3,400 Hm3). Even though the average
volume registered in the last 85 years has been slightly over 50 m3/second, that is to say, some 1,600 Hm3
a year, which comes close to the current demand of potable water, and water for irrigation and industrial
use, yearly fluctuations in the availability of water are still a priority issue in Mendoza. During a dry year,
the Mendoza suburban area may not have enough water for gardens, street trees and roads; the watering
of non-asphalted streets of the marginal neighborhoods at the foothill is not possible; long hours of
pumping are needed to irrigate crops and prevent the loss of harvests or plantations in areas without water
wells to complement surface irrigation.
Regulating the water of the Mendoza River means being able to have a better control of the possibilities
of the river, by preventing great losses of water during the ‘rich’ years, and reducing the deficit during the
‘poor’ years.
The construction of the Potrerillos Project gave employment to 1,200 people directly, 800 people were
subcontracted, and it had a multiplying effect on economy as a whole. Tourism, recreation activities and
services constitute a source of future employment.
Irrigation
Thanks to this Project, irrigation has been supplied to 75,000 Has, and the necessary water to cover the
irrigation needed for the agricultural development of the region will be efficiently guaranteed and
sustained.
Regulation will enable to plan and readjust the irrigation network. The replacement of underground water
reduces pumping costs for the benefit of growers and the State.
Besides, the irrigation infrastructure operational and maintenance costs have been reduced as the tasks of
cleaning and sand removal from the network have not been required, which at the same time cause the cut
off of the water service for days.
The Project also allows the implementation of more modern irrigation technologies such as drip and
micro-sprinkler irrigation.
Potable water supply

A supply of potable water is ensured for the population of the Mendoza River Oasis. An estimation of
said supply anticipates daily requirements superior to the minimum volumes registered in the river.
The dam constitutes a ‘barrier’ to periodic and extraordinary flooding.
D.2. If environmental impacts are considered significant by the project participants or the host
Party, please provide conclusions and all references to support documentation of an environmental
impact assessment undertaken in accordance with the procedures as required by the host Party:
No significant environmental impacts have been identified.

SECTIO E. Stakeholders’ comments
E.1. Brief description how comments by local stakeholders have been invited and compiled:
CEMPPSA has performed an assessment of internal and external stakeholders of the firm, who could be
affected by the Project registration in the Clean Development Mechanism.
For such purpose, the different categories of stakeholders, both direct and indirect, of the CDM Project
were identified. The categories analyzed were: community, employees, associate firms, clients and capital
contributors.
Subsequently, a classification of the identified stakeholders was done according to their interest toward
and influence on the CDM Project, setting levels of priority: high, medium and low by assessing how
much interested, concerned or affected they are.
As a result of the foregoing procedure, the following were considered priority actions:
• To make public the Potrerillos Project registration in the CDM through the mass media in order
to make the project known and, at the same time, provide a consulting source for anyone who is
interested in contacting the Project organizers. To this end, an article was published on March
10th, 2007 in Los Andes, the most important newspaper in Mendoza.
The referred article is attached in Annex 5, and can also be accessed through the Los Andes
Newspaper website (http://www.losandes.com.ar/nota.asp?nrc=365312)
As the publication had significant local circulation, CEMPPSA´s Commercial Manager, Mr Juan
Martín Del Pópolo (Engineer), offered a radio interview on March 14th at the Infinita Radio
Station in Mendoza (FM 98.5 Mhz), on the program hosted by Mr Darío Gallardo, a well-known
journalist and economist from Mendoza. During the interview, Mr Del Pópolo presented the main
aspects of the inclusion of the Potrerillos Project in the context of the Clean Development
Mechanism.
• Likewise, comments by the Board of Directors and Auditors have been considered a priority.
Therefore, the formal presentation of the Project before the stakeholders took place during one of
CEMPPSA´s monthly Meetings of the Board of Directors as the latter is made up of
representatives of each of the stakeholders. Present at the meeting were:
- Director on behalf of Class “A” shareholders (Province): María Elina Ouet

- Director on behalf of Class “B” shareholders (JCCC) (Chairman of the Board of
Directors): Sergio A. Vestfrid
- Director on behalf of Class “D” shareholders (JCCC): José Raúl Bistué
- Director on behalf of Class “E” shareholders (IMPSA): Hernán Guiñazú
- Deputy Director on behalf of Class “C” shareholders (JCCC) and CEMPPSA´s General
Manager: Antonio Torre
- Auditor on behalf of Class “A” shareholders: Humberto Blanco
- Auditor on behalf of Class “C” shareholders: Sergio A. Trípoli
- Auditor on behalf of Class “D” shareholders: Carlos Nallib
Present were also:

- Sebastián Sánchez, Attached to CEMPPSA´s Administrative and Financial Management
- Diego A. Nebot, Legal advisor - CEMPPSA
- J.M. Del Pópolo, Commercial Manager - CEMPPSA
On April 12, 2007, the formal presentation of the Project before CEMPPSA´s Board of Directors
was made, in the presence of representatives of the private stakeholders and of the Government of
Mendoza. The presentation was in charge of Mr Martín Del Pópolo, CEMPPSA´s Commercial
Manager. At its conclusion, invitation was made to those present to make questions or comments.
The main issues dealt with are summarized below:
• General aspects of the CDM

• Characteristics of the CDM Potrerillos Project
• Estimated emission reduction
• Aspects related to the Project additionality
• Contribution to the local and national sustainable development
E.2. Summary of the comments received:
No adverse comments were received during the presentation of the Project.
In general, the public has made inquiries in relation with the CDM, as well as some about this Project in
particular. Some of them are listed below:
− Which local and international authorities evaluate the Project?

− Who are the parties involved in the CDM activity?
− What are the benefits of this CDM activity?
− What is the revenue estimated from the sale of CERs?
− What characteristic of the Project activity will contribute to its introduction into the CDM?
− What is the process of acquisition of CERs for countries aiming at emission reduction?
All inquiries were replied to during the process of communication of the CDM activity.
E.3. Report on how due account was taken of any comments received:
The comments received during the activities of presentation of the Project were replied to at the time. The
comments received did not give rise to changes in this PDD.
Annex 1
COTACT IFORMATIO O PARTICIPATS I THE PROJECT ACTIVITY
Organization: Consorcio de Empresas Mendocinas para Potrerillos S.A. (CEMPPSA)

Street/P.O.Box: Carril Rodríguez Peña 4447
Building:
City: Coquimbito, Maipú.
State/Region: Provincia de Mendoza
Postfix/ZIP: 5513
Country: Argentina
Telephone: 0054 261 4819167
FAX: 0054 261 4819030
E-Mail: cemppsa@cemppsa.com.ar
URL:
Represented by: Commercial Manager
Title: Industrial Engineer – MBA
Salutation: Mr. / Sr.
Last Name: Del Pópolo
Middle Name: Martín
First Name: Juan
Department: Commercial Management
Mobile: 0054 261 155 114851
Direct FAX:
Direct tel:
Personal E-Mail: mdelpopolo@cemppsa.com.ar
Annex 2
IFORMATIO REGARDIG PUBLIC FUDIG
There is no public funding involved in the Project.
Annex 3
BASELIE IFORMATIO
Calculation of operation Margin emission factor
As specified in option (c) established in the approved methodology ACM0002/version 06, the operating
margin emission factor based on the dispatch data analysis is employed.
The “Dispatch Data Analysis” is based on the hourly emission calculation of the set of plants (n) falling
within the top 10% of the system dispatch. In general, these (n) plants are the least efficient ones. This
Analysis has been made for the generation in the Wholesale Electric Market (in Spanish, MEM), 2005.
The Potrerillos Project units are connected to the MEM.
In order to determine the set of (n) plants to be assessed the following data, provided by the Wholesale
Power Market Operator (CAMMESA), have been used:
1. The hourly energy produced by each generating unit.
2. The variable generation cost of each generating unit with which the merit order or dispatch is
realized.
3. Fuel consumed per hour.
Generation dispatched as well as imports are included.
Data Used
CAMMESA Board is composed by every electric market agent (consumers and suppliers). The Board is
presided by the National Energy Secretariat. Thus we count with public and official data provided by
CAMMESA. These data are available in the web site: www.cammesa.com.ar
The information needed about each generating unit was obtained from reports published by CAMMESA:
1. “Parte de Control Post-Operativo”. This is a post - operative control report which is issued
every day, from which we obtained the data of energy production and fuel consumed by each
unit. These post-operative control reports for 2005 period can be found in the "Posoperativos”
directory.
2. “Costos Variables de Producción (CVP)”. Fortnightly declaration of Variable Cost
Production. These costs, declared by each generator, include operation and maintenance costs.
Production costs of hydro units “Valor del Agua (VA)”, “water value” were supplied by CAMMESA.
The “water value” of each reservoir is half-yearly declared by hydro units in the seasonal planning. In the
case of run-of river hydropower plants the “water value” equals zero.
Calculating Procedures
− Elaboration of variable cost matrix
With the information taken from CVP reports about each thermal generating unit (for each feasible fuel)
and with the VA of each hydroelectric generator, a CVP matrix containing a daily CVP for each fuel has
been made.25
Below there is an extract of the CVP matrix where the following headings must be considered:
• CGN: Natural Gas
• CGO: Gas Oil
• CFO: Fuel Oil
• CCM: Mineral Coal
Dispatch CVP Matrix Extract [$/MWh]

Date 29/04/05 30/04/05 01/05/05 02/05/05 03/05/05 04/05/05
FILOTG01_CGN 18.6 18.6 20.3 20.3 20.3 20.3
FILOTG02_CGN 18.6 18.6 20.3 20.3 20.3 20.3
FILOTG03_CGN 18.6 18.6 20.3 20.3 20.3 20.3
LDCUTG23_CGN 20.1 20.1 19.9 19.9 19.9 19.9
LDCUTG24_CGN 20.0 20.0 19.9 19.9 19.9 19.9
EMBANUCL 18.0 18.0 21.1 21.1 21.1 21.1
ATUCNUCL 22.9 22.9 27.4 27.4 27.4 27.4
SMTUCC01_CGN 29.0 29.0 29.1 29.1 29.1 29.1
SMTUCC02_CGN 29.0 29.0 29.1 29.1 29.1 29.1
LDCUCC25_CGN 27.8 27.8 31.6 31.6 31.6 31.6
LDCUTG24_CGO 143.0 143.0 143.0 143.0 143.0 143.0
LDCUTG23_CGO 143.1 143.1 143.0 143.0 143.0 143.0
DSUDCC09_CGO 169.2 169.2 169.2 169.2 169.2 169.2
DSUDCC10_CGO 169.2 169.2 169.2 169.2 169.2 169.2
CEPUCC11_CGO 163.4 163.4 163.4 163.4 163.4 163.4
CEPUCC12_CGO 163.4 163.4 163.4 163.4 163.4 163.4
COSTCC08_CGO 165.6 165.6 165.6 165.6 165.6 165.6
COSTCC09_CGO 165.6 165.6 165.6 165.6 165.6 165.6
COSTTV06_CFO 160.1 160.1 182.1 182.1 182.1 182.1
COSTTV07_CFO 162.8 162.8 185.2 185.2 185.2 185.2
PNUETV09_CFO 174.7 174.7 193.4 193.4 193.4 193.4
SNICTV15_CFO 154.0 154.0 199.6 199.6 199.6 199.6
ADTOHI 60.0 60.0 60.0 60.0 60.0 60.0
ALICHI 60.0 60.0 60.0 60.0 60.0 60.0
CCORHI 60.0 60.0 60.0 60.0 60.0 60.0
CHOCHI 60.0 60.0 60.0 60.0 60.0 60.0
LREYHB 29.7 29.7 29.7 29.7 29.7 29.7
NIH1HI 60.0 60.0 60.0 60.0 60.0 60.0
…….
25
Detailed information on the CVP and the VA are available for validation on spreadsheet format:
• Fortnightly CVP reports can be found in “Costo Variable Producción Térmica” directory.
• Water value VA can be found in “Valor del Agua” directory.
− Hourly dispatch of each generating unit
Information on the energy produced and the fuel consumed by each generating unit has been taken from
the daily post-operative reports supplied by CAMMESA.
The following charts are extracts of this information:
Hourly dispatch of each generating unit on 25/04/2005

GRUPO HORA ARL ESTADO_OPE PI_SOTR ARL_ECON EST_REMUN ENERGIA
25MAHI 1 1 lib - 1 lib -
ACAJTG01 1 1 lib - 1 lib -
ACAJTG02 1 1 === 52.0 1 === 49.3
ACAJTG03 1 1 === 51.0 1 === 49.8
ACAJTG04 1 1 === 52.0 1 === 50.6
ACAJTG05 1 1 === 52.0 1 === 50.7
ACAJTG06 1 1 === 136.8 1 === 136.8
ACAJTV07 1 1 === 136.7 1 === 136.7
ADTOHI 1 1 lib - 1 lib -
AESPTG01 1 1 === 233.0 1 === 234.0
AESPTG02 1 1 === 233.0 1 === 232.8
AESPTV01 1 1 === 253.0 1 === 254.2
ALICHI 1 1 lib - 1 lib -
ALICHITR 1 1 lib - 1 lib -
APARTV A 1 1 lib - 1 lib -
ARGETG01 1 1 i-i - 1 i-i -
ARROHI 1 1 === 60.7 1 === 60.4
ATUCNUCL 1 1 === 123.0 1 === 100.5
AVALTG21 1 1 i-c - 1 i-c -
AVALTG22 1 1 === 26.0 1 === 25.7
AVALTG23 1 1 === 26.0 1 === 25.8
AVALTV11 1 1 === 11.0 1 === 10.9
AVALTV12 1 1 === 11.0 1 === 11.3
AZAPTV A 1 1 lib - 1 lib -
BARRTG21 1 1 i-i - 1 i-i -
BARRTG23 1 1 i-i - 1 i-i -
BARRTG24 1 1 i-i - 1 i-i -
BARRTG25 1 1 i-i - 1 i-i -
BARRTV 1 1 i-i - 1 i-i -
BATLTV03 1 1 i-i - 1 i-i -
Table References:
-Grupo: Group
-Hora: Hour
-Arl.: Local Area
-Estado Ope.: Operating Condition (Lib: Free, i.i.: not available, i.c.: not available due to lack of fuel)
-Pi. Sotr.: Instantaneous Power Capacity
-Arl. Econ.: Local Economic Area
-Est. Rem.: Remunerative Condition
-Energía: Energy
Hourly Fuel consumption of each generating unit on 25/04/2005

GRUPO COMB UNIDAD H01 H02 H03 H04 H05
EMBANUCL_UE UE GUEMTV11 GN DM3 3.9 3.9 3.9 3.9 3.9
ENSETG01_GN GN GUEMTV12 GN DM3 13.1 12.9 12.9 13.0 12.9
FILOTG01_GN GN GUEMTV12 GN DM3 3.8 3.8 3.8 3.8 3.8
FILOTG02_GN GN GUEMTV13 GN DM3 34.1 33.6 33.8 33.8 33.7
LDCUTG23_GN GN MDPATG20 GN DM3
LDCUTG24_GN GN MDPATG21 GN DM3
LDCUTG25_GN GN MDPATV08 GN DM3 8.8 8.8 8.8 8.8 8.8
SMTUTG01_GN GN BBLATV29 FO T 61.8 37.4 34.0 34.0 33.8
SMTUTG02_GN GN BBLATV30 FO T 59.4 35.1 33.5 33.7 33.4
SNICTV13_FO FO COSTTV01 FO T 18.5 11.9 12.3 12.4 12.4
SNICTV13_GN GN COSTTV04 FO T 16.0 11.8 11.6 11.5 11.5
SNICTV14_FO FO COSTTV07 FO T 42.1 35.8 35.8 35.8 35.9
SNICTV14_GN GN MDPATV08 FO T
SNICTV15_CM CM NECOTV04 FO T
SNICTV15_FO FO NPUETV05 FO T 25.8 15.0 11.3 11.4 11.4
SNICTV15_GN GN NPUETV06 FO T 51.7 51.7 48.7 41.3 41.3
SORRTV13_FO FO PNUETV08 FO T 44.0 37.9 23.7 20.8 20.8
SPEDTG21_GN GN PNUETV09 FO T 54.3 53.6 31.1 22.4 22.4
TUCUTG01_GN GN SNICTV13 FO T
TUCUTG02_GN GN SORRTV13 FO T
VMARTG01_GN GN SNICTV15 CM T 124.1 124.6 127.0 130.5 123.7
…….
Table References:
-Grupo: Group
-Comb.: Fuel (G: atural Gas, FO: Fuel Oil, CM: Mineral Coal)
-Unidad: Unit
-Ho1/2/3/4/5: Hour 1/2/3/4/5
− Hourly Dispatch of each generating unit. 10% method.
The CVP of each unit is determined according to the data of energy produced and fuel consumed using
the CVP matrix. Then, the CVPs are rated using the merit order from the most expensive to the cheapest.
Eg. first hour on 25/04/2005:
Dispatch merit order on 25/04/2005 hour 1

Energia x Combustible Consumo Comb Cons Comb Acumulado
GRUPO Energia Energia Energia CVP CCM CFO CGN CGO % Energia CM FO GN GO CM FO GN GO
Acum Total Acum
NPUETV05 100 100 8,888 186.3 - 100 - - 1% - 25.8 - - - 25.8 - -
PNUETV08 165 265 8,888 185.6 - 165 - - 3% - 44.0 - - - 69.8 - -
BBLATV30 246 511 8,888 176.4 - 246 - - 6% - 59.4 - - - 129.1 - -
BBLATV29 256 767 8,888 176.4 - 256 - - 9% - 61.8 - - - 191.0 - -
PNUETV09 226 993 8,888 174.7 - 226 - - 11% - 54.3 - - - 245.3 - -
COSTTV01 73 1,066 8,888 167.3 - 73 - - 12% - 18.5 - - - 263.8 - -
COSTTV04 63 1,130 8,888 165.8 - 63 - - 13% - 16.0 - - - 279.8 - -
NPUETV06 231 1,360 8,888 163.7 - 231 - - 15% - 51.7 - - - 331.4 - -
COSTTV07 169 1,529 8,888 162.8 - 169 - - 17% - 42.1 - - - 373.5 - -
SFRATG01 14 1,544 8,888 62.4 - - 14 - 17% - - 6.2 - - 373.5 6.2 -
RCUATG01 11 1,555 8,888 61.2 - - 11 - 17% - - 5.3 - - 373.5 11.5 -
DFUNTG02 13 1,568 8,888 60.7 - - 13 - 18% - - 5.7 - - 373.5 17.2 -
RGDEHB - 1,568 8,888 60.0 - - - - 18% - - - - - 373.5 17.2 -
Table References:
-Grupo: Group -% Energía Acum: % Accumulated energy
-Energía: Energy -Consumo comb: Fuel Consumption
-Energía Acum: Accumulated energy -Cons Comb Acumulado: Accumulated Fuel
-Energía por combustible: Energy per Fuel Type Consumption
Thus, it can be seen that on the first hour of 25/04/2005, 10% of the total energy generated (889 MWh)
was provided by the following units:
• NPUETV05: 100 MWh, using 25.8 tons of Fuel Oil
• PNUETV08: 165 MWh using 44.0 tons of Fuel Oil
• BBLATV30: 246 MWh using 59.4 tons of Fuel Oil
• BBLATV29: 256 MWh using 61.8 tons of Fuel Oil
• PNUETV09: 54% of the 226 MWh using 54% of 54.3 tons of Fuel Oil.
Therefore, during that hour 220.3 tons of Fuel Oil were used to supply the top 10% of the demand. The
following chart shows a summary of the results for 25/04/2005:
Fuel consumption to supply the top 10% of the demand on 25/04/2005

Consumo Combustible Acumulado
Hora CCM CFO CGN CGO Energía
[Tn] [Tn] [1000 m3] [m3] 10%
1 - 220.3 - - 889
2 - 204.3 - - 815
3 - 196.7 - - 790
4 - 197.0 - - 783
5 - 199.7 - - 793
6 - 203.9 - - 819
7 - 241.4 - - 974
8 - 265.7 - - 1,082
9 - 269.8 - - 1,101
10 - 281.7 - - 1,132
11 - 286.3 - - 1,151
12 - 289.0 - - 1,153
13 - 282.1 - - 1,126
14 - 272.8 - - 1,103
15 - 270.8 - - 1,095
16 - 269.7 - - 1,091
17 - 273.1 - - 1,104
18 - 279.5 - - 1,131
19 - 301.5 - 2.1 1,239
20 - 330.6 18.5 - 1,413
21 - 338.3 15.2 - 1,424
22 - 325.7 9.8 - 1,362
23 - 302.9 6.7 - 1,264
24 - 276.0 0.1 - 1,141
Table References:
-Consumo Combustible Acumulado: Accumulated Fuel Consumption
-Hora: Hour
-CCM: Consumption with Mineral Coal
-CFO: Consumption with Fuel Oil
-CG: Consumption with atural Gas
-CGO: Consumption with Gas Oil
-Energía: Energy
- Calculation of the Building Margin emission Factor
As stated in option (1) of the approved methodology ACM0002 version 06 the ex-ante build margin
emission factor is the weighted average emissions (in tonCO2equiv/MWh) of the recent capacity additions
to the system (sample of m power plants), whose additional capacities (in MW) are defined as the more
recent 20% of the existing plants or the 5 more recent plants. The greater annual generation should be
taken out of these two options. The emissions are the product between the fuel volume used for the
conventional thermal generation and the emission factors respectively. The chart below shows the
generation added to the system until completing the 20% of the energy generated by the system in 2005.
If 20% falls on part capacity of a plant, that plant is included in the calculation. It can be seen that the last
5 plants represented a contribution of less than 1% of the generation in 2005.
It was considered as Start Date when the unit was commercially authorized. This data was obtained from
the data published by CAMMESA.
Commercial Accumulated Accumulated

Authorization Generation Participation
# Power Plant Type
in respect to generation
Year Month [MWh year] 2005
1 2005 Nov Arcor M Seveso CC 28.945 0,03%
2 2004 Jun Consorcio Potrerillos (Cacheuta N) Hydro 403.682 0,47%
3 2004 Apr CT San Nicolás TG - 0,47%
4 2003 Nov Autogenerador Shell TG 99.183 0,58%
5 2003 Jun CT Pluspetrol Norte TG 86.137 0,67%
6 2002 Aug Consorcio Potrerillos (El Carrizal) Hydro 80.034 0,76%
7 2002 Nov Petrolera Chevron San Jorge MTG - 0,76%
8 2002 Jun CT Pluspetrol Norte TG 86.137 0,85%
9 2002 Aug CT San Miguel de Tucumán CC 757.409 1,67%
10 2001 Nov C.T. AES Paraná CC 4.182.800 6,21%
11 2001 Aug Ave Fénix Energía SA TG - 6,21%
12 2001 Jun Dock Sud CC 3.809.281 10,34%
13 2000 Sep Autogenerador Entre Lomas TG 12.922 10,36%
14 2000 May CT Puerto Nuevo CC 2.790.569 13,38%
15 2000 Feb CT Tucumán CC 859.635 14,32%
16 2000 Jan Agua del Cajón CC 1.303.922 15,73%
17 1999 Dec Pichi Picún Leufú Hydro 1.177.263 17,01%
18 1999 Sep Central Dique TG 6.320 17,02%
19 1999 Jul CT Costanera (*) CC 1.890.205 19,07%
20 1999 Jan CT Costanera (**) TG 1.561.782 20,76%
Source: CAMMESA Monthly report. Own elaboration
(*) C. COSTANERA. Steam Turbine TV10 of 320 MW entry, with which combined cycle is completed This unit is connected to
bars of 220 kV. Commercially authorized on 01/07/99.
(**) C. COSTANERA. Gas Turbine TG9 of 264 MW commercially authorized on 15/01/99. Second TG that will later form
the combined cycle of the central.
Emission Factor of Operating Margin, Build Margin and Combined Margin
2005 Accumulated fuel consumption for the top 10% (of the n plants for calculating the Operating Margin)
GO 825 kg/m3
CCM CFO CGN CGO CGO 10% Energy
[ton] [ton] [1000 m3] [m3] [ton] [GWh]
Month
1 - - 105,234 929 766 823

2 5,817 7,166 76,606 860 710 751
3 13,785 85,522 58,257 281 232 795
4 913 151,700 34,936 160 132 757
5 57,293 141,839 24,947 2,267 1,870 779
6 48,498 130,374 18,453 8,716 7,190 775
7 41,183 146,855 17,406 4,731 3,903 819
8 53,535 144,631 15,285 3,609 2,977 804
9 51,185 90,619 24,552 3,886 3,206 753
10 15,077 13,915 105,498 433 357 739
11 - 37,828 110,055 469 387 792
12 - 9,384 148,693 62 51 829
287,287 959,832 739,922 21,782 9,416.990
Unit: The Factor corresponds to the CO2

Factor 2.54 3.44 2.10 3.36
Emission factor (in tons) per ton of fuel
Total
Resultant Emissions 728,836 3,299,421 1,550,986 73,120 5,652,362.60 ton CO2
Operating Margin 0.60023 ton CO2/MWh
Build Margin 0.37711 ton CO2/MWh
Combined Margin 0.48867 ton CO2/MWh

Build Margin (2005)

Net Generation by Power Station 2005 (MWh)
Thermals Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 total
AGUA DEL CAJON 315,796 274,362 298,180 302,784 337,880 254,642 239,430 251,372 264,623 270,809 167,812 214,502 3,192,194
ALTO VALLE 47,207 40,089 50,034 49,794 40,706 5,440 5,775 8,429 9,970 5,006 26,381 16,142 304,973
AES PARANA 500,051 468,069 542,328 513,622 331,529 239,696 259,321 273,262 239,266 258,536 251,106 306,013 4,182,800
C.DE PIEDRA - - 24 - 2,702 1,031 126 1,406 1,822 356 40 132 7,639
CTSM DE TUCUMAN 92,393 150,170 193,051 235,942 224,129 193,530 172,893 127,442 167,995 179,378 206,237 235,848 2,179,007
COSTANERA 183,987 190,267 269,699 287,976 148,271 216,886 211,135 347,992 154,833 1,258 51,223 - 2,063,527
C.COMB.COSTANERA 553,411 494,913 518,418 441,777 445,019 275,448 310,649 388,394 361,600 288,515 483,594 452,033 5,013,769
DEAN FUNES 16,216 10,203 11,586 5,219 2,174 1,460 2,301 3,380 1,408 1,902 1,948 1,584 59,382
DIQUE 823 945 1,135 837 1,831 2,339 1,977 290 6 - 15 25 10,223
DOCK SUD C.COMB 470,489 419,827 519,547 426,473 322,931 148,524 - 117,464 97,893 403,363 418,574 464,196 3,809,281
DOCK SUD 2,761 2,539 575 653 4,370 101 - - - 30 472 792 12,293
FILO MORADO 25,247 25,330 22,756 22,393 26,408 26,095 22,638 21,114 23,038 24,501 24,417 26,779 290,715
FRIAS - 85 - - - 121 71 - - - - - 278
GEBA 449,098 407,927 449,441 215,346 446,782 431,498 434,522 456,981 455,467 389,074 346,256 454,823 4,937,215
GOYA - - - - - - - - - -
GUEMES 111,065 114,892 163,218 143,251 154,717 119,108 145,788 154,076 125,150 113,908 132,727 138,706 1,616,607
INDEPENDENCIA 28 - 49 - 9 51 56 - - - 51 - 244
LA BANDA 667 - - - - 18 13 - - 161 795 759 2,413
LA RIOJA 2,750 34 428 1,332 25 1 80 - 4 122 818 912 6,505
LUJAN DE CUYO 210,117 207,630 204,959 224,186 218,669 223,985 232,390 225,553 203,581 219,330 230,199 230,992 2,631,592
MAR DE AJO 1,686 889 - - 108 595 122 18 117 - 2 308 3,845
MAR DEL PLATA 31,247 29,078 22,213 21,121 18,511 23,394 22,157 20,012 15,798 27,408 27,587 17,985 276,512
MARANZANA 46,445 41,786 48,618 47,317 44,754 37,504 23,922 13,298 20,243 - - - 323,887
NECOCHEA 60,624 71,711 47,466 37,235 41,116 28,336 42,278 41,186 41,104 22,769 28,485 22,121 484,430
LOMA DE LA LATA 221,765 200,608 121,176 114,494 150,798 51,526 62,764 78,173 77,725 14,129 116,018 43,347 1,252,523
NUEVO PUERTO 90,026 131,188 148,057 204,760 54,970 99,046 141,221 149,040 105,818 75,319 94,883 95,346 1,389,674
PUERTO NUEVO 57,883 36,709 118,116 217,877 243,772 154,258 181,404 198,623 119,165 47,706 117,288 81,136 1,573,936
C.COMB.PUERTO 438,062 386,521 399,992 200,647 199,149 109,738 105,389 145,374 168,137 195,484 222,277 219,797 2,790,569
PALPALA - - - 47 - 84 - - - - 586 44 761
PIEDRABUENA 196,732 74,296 252,540 361,036 225,919 209,014 229,016 105,975 89,718 11,034 105,863 96,972 1,958,116
PILAR 105,310 89,140 83,774 82,558 97,842 106,367 114,661 130,924 82,182 76,920 106,366 105,439 1,181,481
PLUS PETROL NORTE 17,542 61,676 41,063 22 3,005 2,192 1,486 3,667 7,886 91 26,753 6,890 172,273
LEVALLE 8,209 7,384 7,991 3,785 3,177 3,140 3,541 3,378 2,980 3,921 7,421 9,236 64,163
VILLA MARIA 8,874 7,945 9,511 3,873 2,708 2,744 2,871 2,137 2,263 3,380 5,244 6,909 58,458
RIO CUARTO 7,988 5,388 7,604 4,402 2,070 2,618 3,634 4,901 825 1,421 3,158 2,035 46,045
S.NICOLAS 129,969 129,429 186,377 87,523 198,858 186,010 195,048 214,446 153,151 32,740 31,788 38,744 1,584,083
SAN FRANCISCO 20,096 15,941 16,995 10,957 2,075 1,405 1,746 1,972 1,142 1,071 1,539 1,485 76,423
SAN PEDRO 1,165 - 54 891 771 779 881 747 649 661 1,126 1,493 9,216
SARMIENTO CUYO 1,561 1,467 1,145 1,292 1,206 1,049 764 127 515 889 350 911 11,277
SARMIENTO NOA - - - - 14 78 49 - - - 29 - 170
SORRENTO 55,430 49,351 39,598 69,335 54,346 35,400 29,957 - 14,989 8,301 28,195 38,744 423,648
SARMIENTO NOA - - - - 14 78 49 - - - 29 - 170

SORRENTO 55,430 49,351 39,598 69,335 54,346 35,400 29,957 - 14,989 8,301 28,195 38,744 423,648
SUR OESTE 11,713 10,826 11,500 1,881 3,415 2,791 4,360 4,860 2,530 2,064 2,207 3,667 61,812
TERMOELECTRICA BS AS 93,251 137,550 189,549 187,764 123,889 60,183 21,990 49,053 - 110,467 165,881 184,859 1,324,435
TERMOROCA - - - - - - 16,512 15,023 4,981 4,311 11,264 10,460 62,550
VILLA GESELL 5,352 4,926 2,655 774 113 892 242 44 94 64 667 405 16,229
C.T.TUCUMAN 253,348 128,764 147,354 210,094 257,534 193,942 224,317 271,688 203,832 252,684 257,563 246,558 2,647,677
SUB-TOTAL 4,843,333 4,435,906 5,162,556 4,763,956 4,484,739 3,484,219 3,493,117 3,831,822 3,241,853 3,049,083 3,706,291 3,741,787 48,238,663
Self-generators - - -
ACEROS PARANA 5 28 - - - - - 15 33 1,393 1,021 704 3,199
ACEROS ZAPLA - - - - - - - - - - - - -
LEDESMA 1,180 2,211 2,094 429 38 236 213 316 413 689 989 2,703 11,511
SEMINO 1 - - - - 4 - - 1 - - - 6
P.HERNANDEZ YPF 1,011 320 500 398 224 671 104 49 108 5 62 39 3,491
NIDERA - 14 - 35 15 - 2 1 3 - - - 71
SHELL DOCK SUD 9,539 8,400 10,634 10,565 10,966 9,751 7,348 9,247 6,550 8,490 2,978 4,716 99,183
TRAPIAL - - - - - - - - - - - - -
ENTRE LOMAS 742 760 838 1,173 1,361 1,431 999 1,087 1,270 1,158 1,065 1,040 12,922
ARCOR M. SEVESO 13,724 15,222 28,945
YPF PLAZA HUINCUL 17,792 16,250 18,548 18,866 19,847 19,591 20,342 19,374 19,029 18,918 18,218 18,026 224,802
SUB-TOTAL 30,269 27,982 32,614 31,467 32,451 31,683 29,008 30,089 27,407 30,653 38,057
-
42,450
-
384,130
-
Co-generators - - -
CMS ENSENADA 78,187 38,569 72,749 75,032 86,060 84,943 84,951 89,508 86,529 80,415 51,619 84,150 912,712
ARGENER - - - - - - - - - 44,583 108,803 112,997 266,382
SUB-TOTAL 78,187 38,569 72,749 75,032 86,060 84,943 84,951 89,508 86,529 124,998 160,422 197,147 1,179,094
- - -
Total Thermals 4,951,789 4,502,458 5,267,919 4,870,454 4,603,250 3,600,845 3,607,076 3,951,420 3,355,789 3,204,734 3,904,771 3,981,383 49,801,886
- - -
Hidraulics - - -
AGUA DEL TORO 30,835 37,854 22,771 17,904 10,040 19,233 13,568 22,897 26,489 26,296 37,847 68,545 334,279
ALICURA 107,682 207,696 77,023 53,313 31,479 211,262 327,569 307,603 236,111 212,650 282,530 334,133 2,389,052
ARROYITO 51,286 39,969 40,484 39,807 57,255 69,546 83,547 85,741 68,601 41,094 66,571 83,750 727,651
CABRA CORRAL 5,312 7,464 8,347 7,800 7,900 14,933 15,413 18,270 17,198 13,609 10,408 7,810 134,463
CASSAFFOUSTH 8,773 7,101 9,522 6,778 5,105 4,019 5,429 5,936 2,872 1,375 1,157 2,326 60,392
CACHEUTA NUEVA 42,750 31,964 31,162 27,290 25,219 14,969 16,381 33,923 34,878 46,588 42,744 55,814 403,682
CASSAFFOUSTH 8,773 7,101 9,522 6,778 5,105 4,019 5,429 5,936 2,872 1,375 1,157 2,326 60,392
CACHEUTA NUEVA 42,750 31,964 31,162 27,290 25,219 14,969 16,381 33,923 34,878 46,588 42,744 55,814 403,682
CARRIZAL 6,003 4,651 4,259 8,289 3,734 - 1,694 6,444 8,947 11,597 12,258 12,158 80,034
CHOCON 230,166 154,199 162,136 150,677 223,648 307,375 417,028 373,212 291,500 156,184 300,219 436,748 3,203,090
C.H.PICHI PICUN LEUFU 65,497 55,328 55,557 52,199 47,723 115,714 168,295 137,517 114,323 86,276 149,542 129,292 1,177,263
CRUZ DEL EJE 97 102 63 171 203 228 204 222 156 98 142 215 1,900
EL CADILLAL 1,280 49 3 155 2,007 2,219 2,491 2,787 3,353 3,745 4,270 3,986 26,344
EL TIGRE 6,341 4,087 4,176 3,443 3,683 109 1,708 4,850 6,533 7,466 7,494 8,210 58,099
EL TUNAL 3,478 2,884 2,908 2,604 2,623 2,897 3,356 3,656 3,933 3,839 3,687 2,617 38,481
ESCABA 5,473 3,743 571 2,614 5,920 4,886 4,123 3,769 4,756 7,467 5,836 6,187 55,347
FITZ SIMON 7,366 7,090 7,782 6,945 5,326 4,218 5,686 5,917 2,772 1,205 1,100 2,248 57,655
LA CALERA - 257 1,500 1,139 1,292 999 762 1,230 1,267 1,116 824 1,019 11,405
LA VIÑA 2,207 2,321 1,868 3,516 2,921 1,523 1,310 1,935 2,252 2,790 1,723 1,712 26,077
LAS MADERAS 1,897 1,484 1,111 1,310 1,056 1,473 1,373 1,148 1,085 1,224 1,457 1,037 15,655
LOS MOLINOS I 7,448 7,150 7,939 7,825 8,907 8,610 9,974 9,597 10,698 9,597 8,804 10,413 106,965
LOS MOLINOS II - - - - - 819 1,347 1,528 1,853 726 1,369 1,782 9,423
LOS REYUNOS 24,637 18,937 20,059 20,293 21,468 8,525 10,937 19,771 26,857 30,941 30,642 40,072 273,139
NIHUIL 1 25,611 40,578 40,795 36,651 22,612 16,314 16,765 42,445 48,754 40,084 48,066 44,162 422,836
NIHUIL 2 24,150 40,544 40,710 36,691 22,794 16,056 16,638 42,680 56,329 40,869 51,774 47,672 436,906
NIHUIL 3 9,577 15,634 15,828 13,994 8,891 6,343 6,470 16,282 21,671 15,573 19,720 18,584 168,566
NIHUIL 4 14,408 8,526 9,967 9,169 4,125 - 1,996 18,396 21,317 20,209 18,936 18,038 145,088
P.BANDERITA 91,157 65,617 69,892 66,693 69,529 213,386 260,461 275,561 236,273 255,670 220,477 161,733 1,986,449
P.DEL AGUILA 323,523 265,078 264,989 246,504 216,997 563,348 843,676 672,852 565,586 431,605 808,297 887,591 6,090,046
PIEDRAS MORAS 4,346 3,966 4,400 4,258 4,344 3,752 3,894 3,651 514 1,084 602 1,709 36,521
PUEBLO VIEJO 6,692 5,844 9,249 9,327 5,453 3,795 3,024 2,458 2,455 2,259 2,403 4,422 57,381
QUEB.DE ULLUM 13,973 7,778 6,904 8,478 8,084 4,746 3,708 11,433 13,013 19,747 25,216 31,797 154,877
QUIROGA 1,211 1,174 965 994 60 339 1,214 1,411 1,296 1,321 1,136 950 12,071
REOLIN 9,481 6,908 10,334 5,534 3,739 3,009 4,186 4,878 2,187 807 767 1,474 53,305
RIO HONDO 11,090 9,527 7,978 9,936 12,472 11,470 5,919 7,257 11,617 11,526 10,646 10,925 120,364
RIO GRANDE 73,875 38,734 68,831 49,532 30,747 41,625 38,346 12,101 9,831 11,752 48,538 35,458 459,371
SALTO GRANDE 73,358 100,941 66,158 262,507 514,737 519,274 414,006 217,195 472,212 613,878 375,097 159,024 3,788,387
SAN ROQUE 8,894 11,026 9,932 5,144 5,387 4,374 2,850 5,256 5,001 4,517 4,305 4,439 71,125
ULLUM 19,573 15,785 16,796 14,197 15,277 11,226 16,745 15,485 17,304 26,163 29,498 31,154 229,203
YACYRETA 1,107,832 983,320 924,204 944,862 1,000,744 1,050,964 975,970 933,130 1,071,282 1,118,896 1,062,880 1,125,068 12,299,152
CASA DE PIEDRA 26,409 23,136 20,371 16,526 13,206 3,737 13,585 24,945 32,106 33,328 33,445 37,258 278,050
SUB-TOTAL 2,453,688 2,238,447 2,047,541 2,155,068 2,426,706 3,267,314 3,721,647 3,355,371 3,455,183 3,315,171 3,732,426 3,831,536 36,000,096
- - -
NUCLEAR - - -
ATUCHA I 198,610 96,285 - 28,093 142,270 211,885 250,421 236,799 167,658 218,063 207,027 244,767 2,001,876
RESERVOIR 442,538 399,749 442,303 429,384 436,761 433,440 447,407 446,305 432,349 307,986 - 154,261 4,372,482
SUB-TOTAL 641,148 496,033 442,303 457,477 579,030 645,326 697,828 683,104 600,007 526,048 207,027 399,028 6,374,359
Import 157,575 248,183 170,187 76,738 169,395 235,567 156,737 35,477 102,885 308,856 35,251 39,342 1,736,194
TOTAL Monthly 8,204,200 7,485,121 7,927,949 7,559,738 7,778,381 7,749,051 8,183,287 8,025,371 7,513,863 7,354,809 7,879,474 8,251,290 93,912,535
Source: Wholesale Elect ric Market Managing Com pany (CAMMESA) based on it s own dat a
Energy generated [MWh]. Source: Economic Transactions Document (DTE)

Unit Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 TOTAL
SNICTG01 1,256 1,720 607 741 1,163 511 - - - - - - 5,998
Source: Wholesale Elect ric Market Managing Com pany (CAMMESA) based on it s own dat a. Published in t he Econom ic Transactions Document (DTE).
Fuel consumptions by station

2005 Total
Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 [ton]
AES PARANA - - 33 1,862 4,920 2,834 3,084 - 253 - 12,986
C.COMB.COSTANERA - - 46 1,888 970 1,191 - - - - 4,095
DOCK SUD C.COMB - 0.9 7 - 836 1,854 - 2.75 - - 2,700 798
DOCK SUD - 0.1 1 - 75 167 - 0.25 - 244 72
DIQUE - - - - 7 4 6 17 61.8%
C.COMB.PUERTO - - - 912 1,191 3,536 375 - - - - 6,014
Power in MEM 23,372 MW Source: October 2005 Monthly Report - CAMMESA GO

Energy generation 2005: 92,176,341 MWh GO
Admission Type Power Consumption 2005 Generation
# Year Month Station Adit. Final Adit. [%] machine Acum Acum %
MW MW kcal/kWh MWh MWh %
1 2005 Nov Arcor M Seveso CC 31 31 100% 2,436 28,945 28,945 0.03%

2 2004 Jun Consorcio Potrerillos (Cacheuta N) Hydraulic 122 122 100% - 403,682 432,627 0.47%
3 2004 Apr CT San Nicolás GT 24 24 100% 3,176 5,998 438,625 0.48%
4 2003 Nov Autogenerador Shell GT 25 25 100% 3,040 99,183 537,808 0.58%
5 2003 Jun CT Pluspetrol Norte GT 116 233 50% 2,552 86,137 623,945 0.68%
6 2002 Aug Consorcio Potrerillos (El Carrizal) Hydraulic 17 17 100% - 80,034 703,979 0.76%
7 2002 Nov Petrolera Chevron San Jorge MGT 26 26 98% 3,500 - 703,979 0.76%
8 2002 Jun CT Pluspetrol Norte GT 116 233 50% 2,552 86,137 790,115 0.86%
9 2002 Aug CT San Miguel de Tucumán CC 130 374 35% 1,725 757,409 1,547,524 1.68%
10 2001 Nov C.T. AES Paraná CC 830 830 100% 1,508 4,182,800 5,730,324 6.22%
Gtion with GO 1,508
11 2001 Aug Ave Fenix Energía SA GT 7 47 15% - - 5,730,324 6.22%
12 2001 Jun Dock Sud CC 773 773 100% 1,528 3,809,281 9,539,605 10.35%
Gtion with GO 1,528
13 2000 Sep Autogenerador Entre Lomas GT 15 15 100% 3,252 12,922 9,552,527 10.36%
14 2000 May CT Puerto Nuevo CC 798 798 100% 1,487 2,790,569 12,343,096 13.39%
Gtion with GO 1,487
15 2000 Feb CT Tucumán CC 150 462 32% 1,757 859,635 13,202,731 14.32%
16 2000 Jan Agua del Cajón CC 270 661 41% 1,808 1,303,922 14,506,653 15.74%
17 1999 dec Pichi Picún Leufú Hydraulic 261 261 100% - 1,177,263 15,683,916 17.02%
18 1999 Sep Central Dique GT 34 55 62% 3,600 6,320 15,690,236 17.02%
Gtion with GO 3,600
19 1999 Jul CT Costanera CC 320 849 38% 1,428 1,890,205 17,580,441 19.07%
Gtion with GO 1,428
19 1999 Jan CT Costanera GT 264 849 31% 2,272 1,561,782 19,142,223 20.77%
Gtion with GO 2,272
20 1998 dec CT Costanera GT 264 849 31% 2,272 1,561,782 20,704,005 22.5%
Gtion with GO 2,272
Power in MEM 23,372 GO Low heating value 10,200 Kcal/kg NG Low heating value 8,300 kCal/m^3
Energy generation 2005: 92,176,341 GO Emission factor 3.357 tonCO2/ton NG Emission factor 2.10 tonCO2/dam^3
Admission Type Emissions by fuel Total Emissions
Gas Oil Natural Gas
Estimated Estimated
# Year Month Central Gas Oil Generation Emissions Natural Gas Emissions unitario Acum System
ton MWh 10^3 ton CO2 10^3 dam3 10^3 ton CO2 ton CO2/MWh 10^3 ton CO2 kg CO2/MWh
1 2005 nov Arcor M Seveso CC 8,495 17,807 0.615 17,807 615.21

2 2004 jun Consorcio Potrerillos (Cacheuta N) Hidráulica - - - - -
3 2004 abr CT San Nicolás TG 2,295 4,811 0.802 4,811 10.97
4 2003 nov Autogenerador Shell TG 36,327 76,147 0.768 80,958 150.53
5 2003 jun CT Pluspetrol Norte TG 26,484 55,515 0.645 136,473 218.73
6 2002 ago Consorcio Potrerillos (El Carrizal) Hidráulica - - - 136,473 193.86
7 2002 nov Petrolera Chevron San Jorge MTG - - - 136,473 193.86
8 2002 jun CT Pluspetrol Norte TG 26,484 55,515 0.645 191,989 242.99
9 2002 ago CT San Miguel de Tucumán CC 157,413 329,961 0.436 521,950 337.28
10 2001 nov C.T. AES Paraná CC 744,001 1,559,535 0.373 2,081,485 363.24
Gción con GO 12,986 87,836 43,592 - 2,125,077 370.85
11 2001 ago Ave Fenix Energía SA TG - - - 2,125,077 370.85
12 2001 jun Dock Sud CC 697,956 1,463,019 0.384 3,588,096 376.13
Gción con GO 2,700 18,026 9,065 - 3,597,161 377.08
13 2000 sep Autogenerador Entre Lomas TG 5,063 10,613 0.821 3,607,773 377.68
14 2000 may CT Puerto Nuevo CC 492,558 1,032,474 0.370 4,640,248 375.94
Gción con GO 6,014 41,253 20,188 - 4,660,436 377.57
15 2000 Feb CT Tucumán CC 181,973 381,443 0.444 5,041,879 381.88
16 2000 ene Agua del Cajón CC 284,035 595,379 0.457 5,637,258 388.60
17 1999 dic Pichi Picún Leufú Hidráulica - - - 5,637,258 359.43
18 1999 Sep Central Dique TG 2,721 5,703 0.902 5,642,961 359.65
Gción con GO 17 47 56 - 5,643,017 359.65
19 1999 Jul CT Costanera CC 323,309 677,703 0.359 6,320,721 359.53
Gción con GO 1,544 11,027 5,182 - 6,325,903 359.83
19 1999 ene CT Costanera TG 425,947 892,847 0.572 7,218,750 377.11
Gción con GO 1,276 5,727 4,282 - 7,223,032 377.34
20 1998 dic CT Costanera TG 425,947 892,847 0.572 8,115,879 392.00
Gción con GO 1,276 5,727 4,282 - 8120160.8 392.20
Table References:
-Central: Power Station -Hidráulica: Hydraulic Generation -MTG: Micro Gas Turbine
-CC: Combined-Cycle Generation -TG: Gas Turbine -Gción con GO: Generation with gas oil
GO Low heating value 56.10 tonne CO2/TJ

NG Emission factor 56.10 tonne CO2/TJ
Comments (start operation)
Mario Seveso : 1st November, 2005

CONSORCIO DE EMPRESAS MENDOCINAS PARA POTRERILLOS (CEMPPSA). – CENTRAL HIDRÁULICA CACHEUTA NUEVA.- Unit 3 26/11/02.-Unit 4 11/12/02.
C.T. SAN NICOLÁS [AES SAN NICOLÁS]: 12/04/04.
Shell Capsa - 5/11/03
PLUSPETROL S.A – C.T. PLUSPETROL NORTE.- 6 Jun 2003.
CH. El Carrizal:
Petrolera Chevrón1/08/2002.
San Jorge SA,
PLUSPETROL S.A. (Ex PLUSPETROL EXPLORACIÓN Y PRODUCCIÓN S.A]– C.T. PLUSPETROL NORTE.- 5/06/02
PLUSPETROL ENERGY S.A – C.T. SAN MIGUEL DE TUCUMÁN.-9/05/02 - 27/08/02
Update to AVE FÉNIX ENERGÍA S.A..- 31/08/01.

CENTRAL DOCK SUD S.A..- 20/01/01-13/06/01
AUTOGENERADOR ENTRE LOMAS: (Pérez Companc S.A:) 21/09/00

CENTRAL PUERTO SA.- 5 de May 2000
PLUSPETROL ENERGY S.A – C.T. TUCUMÁN.-10/02/00
HIDROELÉCTRICA PICHI PICÚN LEUFU S.A. Unit 1 30/08/99. Unit 2 9/99. Unit 3 20/12/99
CENTRAL DIQUE S.A. (AES-Américas) 6/09/99.
C.COSTANERA. 1/07/99
Comments
Emission factors:IPCC
Unitary consumption: when alternative fuel is used to the natural gas - as the gas oil - the unitary consumption is major.
Assuming a conservative criterion, the same unitary consumption takes for oil gas and natural gas.
Generationof energy with Gas Oil: the generation of electrical energy from gas oil, is calculated from the released fact of the
volume of GO consumed by agent and assuming the same unitary consumption as when natural gas is used.
Generation autoproducers: (Autogenerator Shell; Petroleum Chevron and Autogenerator Between Hillocks) Assuming a
conservative criterion, the exchange takes only with the network and not the clear generation of the unit, since only public
information of the exchanges is had with the national network.
CT San Nicolás: Unit only operates with gas. Thought as starter in black of the CC. His generation was obtained of the DTE of
the agent.
Central Dique:Since there is not had public informationof the productionof the units enabled commerciallyin September,1999
(2TG's of 17MW), there takes of the energy dedicated to the network for the head office the proportion of these 34 MW with
regard to his installed potency.
Source (*) Emission Factor

Hidraulic 0
Mineral Coal 2.54
Fuel Oil 3.44
Natural Gas 2.10
Gas Oil 3.36
Petroleum Residual Gas 2.38
Asphalt 3.24
Uranium 0.00
*
a) coal, fuel oil y gas oil in tonnes
b) natural gas, in cubic decameters
c) Emission factor: CO2 (in tonnes)
by tonnes of fuel (coal, fuel oil o gas oil) or cubic decameter of natural gas
Source: IPCC, 1996 and Argentine Emissions Inventory, 1999

(For Petroleum Residual Gas and asphalt)
Auxiliar calculations
Heat kcal/kg or m3
High Low ton C / Tjoule
6200 26.56
10500 9261 21.25
9300 8400 14.63
10900 19.99
8500 18.2
9000 22
Indexes
Auxiliar Calculated
Heat
Source (*) Factor
kcal/kg ó m3 ton C / Tjoule
Hydro 0 High Low
Mineral Coal 2.54 6200 26.56
Fuel Oil 3.44 10500 9261 21.25
Natural Gas 2.10 9300 8400 14.63
Gas Oil 3.36 10900 19.99
Uranium 0.00
a) coal, fuel oil and gas oil in tons

b) natural gas in cubic decametres
c) The Factor corresponds to the CO2 Emission factor (in tons)
per ton of fuel (coal, fuel oil or gas oil) or cubic decametre of natural gas.
Source: IPCC, 1996 and Argentine Emissions Inventory, 1999


Annex 4
MOITORIG IFORMATIO
The emission factor of the MEM (Argentine Wholesale Electric Market) has been determined ex
ante. Therefore, the electricity delivered to the grid by the Potrerillos Project, through its
Hydroelectric Stations Cacheuta Nueva and Álvarez Condarco, is the key element to be
monitored during the CDM Project.
The monitoring plan of this Project has been developed on the basis of the monitoring methodology
ACM0002/version06 “Consolidated monitoring methodology for zero-emissions grid-connected
electricity generation from renewable sources”, and it focuses especially on monitoring the electricity
generated by the Project.
1. Monitoring of the electricity delivered to the grid
Monitoring of the electricity generated by the Project will be carried out through CEMPPSA´s
Telecontrol and Communications System, which includes the following characteristics:
The system includes two (2) processing units in Hot/Stand-by mode (Front-End) which enable
the communication interface between the digital control level and the local control level (the
latter including unit boards and auxiliary services of the turbine-generator group and related
equipment).
The digital control system is made up of two (2) operating stations, each of which has a
processor, a color monitor, a keyboard and a color graphic printer.
Apart from the operating stations, the digital control system includes an engineering station,
which consists of a processor, a color monitor, a keyboard and a color printer. A telecontrol
processor (gateway) is also included.
The software is of the multitask type, and it is fit for control and telecontrol systems. This
application program is installed in the required processors.
There is a remote terminal unit (RTU) in the local control level, which constitutes the interface
between the local control and the digital control.
The Remote Terminal Unit (RTU) includes the control software for command automatism at the
local level.
The local control boards include all the data acquisition and control elements necessary for the
plant´s exploitation, that is to say, transducers, auxiliary relays, switches, alarm charts, etc.
The Carrier Wave and Radio Link system enables communication between the central control
and the remote centers for the planned telecontrol operations .
A telephone system is included which will make internal communication possible all over the
facilities and with the telephone public network according to the MEM specifications.
CEMPPSA will ensure that the official reports (from CAMMESA in the case of the Cacheuta
Nueva Station and EDEMSA in the case of the A. Condarco Station), containing the amount of
energy delivered by the Project to the grid, are available during the process of validation and
verification of the Project by the D.O.E.
Cacheuta Nueva Station

Monitoring System of the electricity delivered to the Grid
CAMMESA, the organism in charge of dispatch, founded under the current legislation, by
means of on line systems and equipment that operate according to the MEM procedures,
monthly draws up the so-called MEM Economic Transactions Document (DTE). The Document
contains, among other data, in the chapter called “A1.1 Payment to generator agents for their
energy production in the SPOT market”, the energy that each group of each Generator Agent
has delivered monthly to the SPOT Market.
As explained before, the procedure with relation to the energy delivered by CEMPPSA to the
MEM´s SPOT Market, administered by CAMMESA, is the following:
1) CAMMESA sends CEMPPSA the corresponding ETD by electronic means. It is worth

mentioning that the said Document is public information;
2) Then, CEMPPSA verifies that the data on this register coincide with their own data;
3) In the third place, CAMMESA issues the corresponding Settlement of Sales (Credit);
4) Finally, CAMMESA proceeds to pay the said invoice to the account of CEMPPSA.

Monitoring System of the electricity delivered to the Grid
The totality of the energy generated by this Station, from the beginning of the concession held
by CEMPPSA, is sold to one of the local distributors, EDEMSA. To this end, an Agreement of
Electric Power Supply (Convenio de Abastecimiento de Energía Eléctrica) was signed between
EDEMSA and CEMPPSA.
Even though this Agreement falls outside CAMMESA´s commercial sphere, CAMMESA does
act as Dispatch Agent (OED); therefore, it has access to the generation data of each of the
groups which make up the Álvarez Condarco Hydroelectric Power Station, which data
CAMMESA makes public.
Moreover, there is another supervision agent to the energy supplied by CEMPPSA to

EDEMSA, the Provincial Electricity Regulatory Commission (EPRE). The EPRE is an
interested party with regard to the energy supplied by CEMPPSA under the referred Agreement,
since this provincial entity charges CEMPPSA a supervision and control fee on the basis of the
energy supplied by CEMPPSA and generated at the Álvarez Condarco Power Station.
It is worth pointing out that, in the hypothetical case of this Supply Agreement being
terminated, no matter whether the energy provided by CEMPPSA went to the SPOT Market or
to the Forward Market ( MAT), both of which are part of the MEM, the energy would continue
to be controlled by CAMMESA.
Having the foregoing specifications been made, the following is the monthly procedure with
relation to the sale of the energy generated at the Álvarez Condarco Hydroelectric Power
Station:
1) CEMPPSA, on the basis of internal information on the measurement of the supplied

energy during a certain period, as well as of the information provided by EDEMSA,
issues an invoice corresponding to the energy supplied during such period.
2) EDEMSA verifies the generation values and rates invoiced and proceeds to the payment
thereof.
3) The EPRE verifies the generation data provided in CEMPPSA´s affidavit and compares
them with the information also provided by EDEMSA with regard to the characteristics
of their purchase of electric power, in which the energy bought from CEMPPSA´s
Álvarez Condarco Power Station is discriminated.
The Consortium of Mendocinian Companies for Potrerillos S.A. has designed a document called
“Potrerillos Project Monitoring Plan”. It has been designed to be a guide during the
implementation of the monitoring activities of the information compiled, as well as during the
verification of emission reductions, and a reference document, which is aligned with the usual
operating procedures of both Stations.
Annex 5
Stakeholders´ Comments
Article published in Los Andes Newspaper
ECOOMY SECTIO
THE PULSE OF BUSIESS
“Potrerillos Goes for Green Credits”
The Consortium of Mendocinian Companies for Potrerillos S.A. (CEMPPSA), concessionaire

of the “Exploitation of the Mendoza River – Potrerillos Project”, is in the process of presenting
this Project before the Clean Development Mechanism (CDM) under the Kyoto Protocol.
This is possible because the Cacheuta Nueva and Álvarez Condarco Hydroelectric Power
Stations generate energy from a renewable source and do not produce Greenhouse Gas (GHG)
emissions.
The Project´s registration in the CDM will be a step toward obtaining the so-called “Carbon
Credits or Green Credits”, which can be understood as a recognition to projects that contribute
to the reduction of GHG.
In this case, the Potrerillos Project reduces GHG emissions through the displacement of other
polluting generation sources.
The emergence of non-polluting projects is extremely important, since the concentration of
carbon dioxide, methane, nitrous acid and other polluting gasses in the atmosphere is daily
increasing as a result of different activities carried out by man. Especially those which require
the burning of fossil fuels, such as petroleum and its derivatives.
This undertaking constitutes one more contribution of the Potrerillos Project to the sustainable
development of the region.
Annex 6
Photographs of project
Photo 1 Building of the old Cacheuta Station Photo 2 Potrerillos Dam
Photo 3 Potrerillos Dam Photo 4 Potrerillos Dam

Photo 5 Control Board – Old Cacheuta Station Photo 6 Generation Equipment – Old Cacheuta Station
Photo 7 - Generation Equipment – Old Cacheuta Station

Photo 8 - Generation Equipment - Cacheuta ueva Station
Photo 9 Building Cacheuta ueva Station Photo 10 ew Generation Equipment – Alvarez
Condarco Station

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PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03.1.

CDM – Executive Board page 1

CLEA DEVELOPMET MECHAISM

A. General description of project activity

B. Application of a baseline and monitoring methodology

C. Duration of the project activity / crediting period

Annex 1: Contact information on participants in the project activity

Annex 2: Information regarding public funding

Annex 3: Baseline information

Annex 4: Monitoring plan

Annex 5: CEMPPSA´s newspaper article

Annex 6: Photographs of project

CDM – Executive Board page 2

SECTIO A. General description of project activity

A.1 Title of the project activity:

A.2. Description of the project activity:

CDM – Executive Board page 3

A.3. Project participants:

ame of Party involved (*) Private and/or public Kindly indicate if

Argentina (Host) CEMPPSA (Consortium of o

CDM – Executive Board page 4

A.4. Technical description of the project activity:

A.4.1. Location of the project activity:

A.4.1.1. Host Party(ies):

A.4.1.2. Region/State/Province etc.:

A.4.1.3. City/Town/Community etc:

A.4.1.4. Detail of physical location, including information

CDM – Executive Board page 5

South America Mendoza/Argentina

Area of the Project activity

CDM – Executive Board page 6

A.4.2. Category(ies) of project activity:

A.4.3. Technology to be employed by the project activity:

Figure 1. Typical sections of the Potrerillos Project

CDM – Executive Board page 7

- Espaldón: Embankment - Chimenea de Equilibrio: Staff gage

CDM – Executive Board page 8

CDM – Executive Board page 9

A.4.5. Public funding of the project activity:

The Project does not include public funding.

CDM – Executive Board page 10

SECTIO B. Application of a baseline and monitoring methodology

• It applies to electricity generation capacity additions from:

The development of this Project according to the methodology ACM0002/Version 06 is appropriate

CDM – Executive Board page 11

As explained so far, the consolidated baseline methodology ACM0002/Version 06: “Consolidated

CDM – Executive Board page 12

Figure 2. Geographic Diagram of the SADI´s Electric Grid3

CDM – Executive Board page 13

Figure 3. Geographic Diagram of the electric grid of Mendoza city4

CDM – Executive Board page 14

Figure 4. MEM Installed Capacity5

CDM – Executive Board page 15

Old Station (units out of

Figure 5. Unifilar diagram of SADI owners (March 2007) – Cuyo region

CDM – Executive Board page 16

Source Gas Included? Justification/Explanation

Reservoir CH4 No According to Item II b of the

06, if the power density of the

CDM – Executive Board page 17

Cacheuta Nueva Power Station Álvarez Condarco Power Station

Description of the baseline scenarios

CLEA DEVELOPMET MECHAISM

SECTIO A. General description of project activity

ame of Party involved (*) Private and/or public Kindly indicate if

Argentina (Host) CEMPPSA (Consortium of o

SECTIO B. Application of a baseline and monitoring methodology