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S. Kumar, S. Sharma and R.M. Shrestha Asian Institute of Technology
4 April 2005
Presentation Objective and Outline
• To provide the background of Case study 1 Presentation – Project description Objective – Baseline Methodology description
• The project details Presentation • Baseline Methodology
Outline – – – – – – – – Methodology: Applicability conditions Identification of Baseline scenario Additionality Project Boundary Baseline formulae Leakage Emission reductions Data Sources and Vintage
INTRODUCTION 3 .
5 mmt. a rise of 10.7% by BOF process) Feb.2% on the same month in 2004.8 mmt (48.SOME STEEL DATA 2003 World steel production – 965 million metric tonnes (mmt) ((63.4 mmt.pdf 4 . Japan – 110. up 21. 2005 • Total production for the Asian region was 41.4 mmt India (8th) – 31. Source: http://www.3% on February 2004.org/media/wsif/wsif2004.worldsteel.3% by BOF) China (1st) – 220. • China produced 24.1 mmt.8 mmt of crude steel in February. USA – 90.
5 million tpa. • It is proposed to collect and use this gas • as a fuel in a power plant to produce electricity. • This gas is currently flared. technologically efficient and eco-friendly integrated steel plant of its kind. Source: http://www. • During the production of steel using BOF process. • as a fuel for internal heating requirements of the plant • It is estimated that the primary emission reductions would amount to 575.SOME PROJECT DATA • The Jindal Vijayanagar Steel Plant (JVSL) is the most modern.com/. The power plant currently uses coal.jvsl. • The Plant has a hot rolling capacity of 2. and uses the revolutionary Corex technology. • This has a calorific value of about 2. CO is produced.000 kcal/Nm3. The electricity to be supplied to the state grid (about 95 GWh per year).967 tonnes of CO2 during the 10 year crediting period. Project Document 5 .
cleaning.PROJECT DESCRIPTION .SCHEMATIC Power Plant (i) Supply to existing power plant (sister concern) no capacity increase (BASE: only coal). & (ii) Few New proposed power plant supplying to grid PROJECT: Gas Collection. 2000 Kcal/NM3 STEEL 6 . storage and distribution system Base Case: Flared Used as fuel for heat BOF gas.
energymanagertraining.htm 7 .com/iron_steel/Iron_Steel_process.BASIC OXYGEN FURNACE (BOF) OPERATION BOF GAS Source: http://www.
PROJECT LOCATION 460 km VSNL Plant .html 8 .mapsofindia. 540 km http://www.com/states/index.
BASELINE METHODOLOGY 9 .
excluding grids with surplus power. • No change in process except changes due to collection. nor any regulation making use of waste gases mandatory. unless cost of generation and supply is favourable for inter-grid transfers. • Though not stated – methodology applicable to project that supplies gas to – Existing power plant with no expansion of capacity. and remaining waste gases would normally have been flared in the absence of the project activity. or – Existing power plant with gas meeting requirement of capacity expansion. stabilization and transportation of waste gases to electricity generators. • No local regulations/ programmes to constrain use of GHG intensive fuels (like coal). or 10 – New power plant supplying to grid. and • Project activity results in supply of electricity to local grid. to project activity. Methodology: Applicability conditions • Project activity does not induce diversion of waste gases required for internal usage. .• Part of waste gas used for internal heating requirements within the steel manufacturing industry.
in the absence of the proposed project activity) has the following components: – Flaring of excess BOF gas – In absence of use of BOF gas for electricity generation • use of more GHG intensive fuels for generation of additional electricity at the existing power plants leading to emission of GHG (Case I). 11 . and • need to establish new power plants to meet any shortfall in supply. with possibility of further GHG emission (Case II).Identification of Baseline Scenario • Approach – 48(a) existing actual or historical. • The baseline scenario (ie.
• Baseline: GHG intensity of existing power plant. 12 . • Baseline: Combined Margin grid intensity – based on ACM0002 methodology. – Case II: • Use of waste gas to generate additional power in existing power plant and/ or generate power in new power plant(s). • The baseline scenario is therefore ‘continued use of the GHG intensive fuel’.Identification of Baseline Scenario – Case I: • Partial replacement of existing GHG intensive fuel in an existing power plant (no generation increase). • The baseline scenario in this case is ‘electricity would have otherwise been generated by the operation of gridconnected power plants and by addition of new generation sources’.
levelized cost of electricity generation or Rs. and purchasing power from the grid.Additionality • Use of “Tool for assessment and demonstration of Additionality” – Investment analysis • investment comparison analysis using a financial indicator (such as IRR.cost benefit ratio. 13 . The cost of power in the alternative scenario in comparison to the project activity is Rs 1./kWh values). NPV.94/kWh. and checking whether there is at least one identified alternative which is better for investment than the project activity. • The chosen alternative to the project is flaring of the waste gases.
cleaning and transportation of these gases to the power plant through a gas handling network.Project Boundary This includes points of generation of waste gases in steel mfg operation. Source: Project Document . under the control of the project proponents. and all associated 14 equipment for such project activity. stabilisation. delivery of power to grid.
15 .Baseline Case I: Formulae used Partial replacement of existing GHG intensive fuel in an existing power plant (no generation increase).
Baseline Case 2: Formulae Used Use of waste gas to generate additional power in existing power plant and/ or generate power in new power plant(s). Operating Margin Build Margin The sample group m consists of either: · five power plants that have been built most recently [including plants under construction]. or · power plants capacity additions in the electricity system that comprise 20% of the system generation (in GWh) and that have been built most recently [including plants under construction]. 16 .
Y and Z are not available. then 17 CF = 1 . such possibilities are ruled out since this would necessitate replacement and use of alternate power generating technology. W] / W – ‘Y’ : minimum quantity of waste gases flared in the steel manufacturing industry (average of sector during the last 3 years) – ‘Z’: average amount of waste gases used for internal requirements of all waste gas generators (in similar steel manufacturing sector) in the region or country during the last 3 years – ‘X: the minimum quantity of waste gases generated in the steel manufacturing industry sector during the last 3 years. which may not be feasible for a smaller generator. – However. and – W: waste gas supplied to power plants – If the steel industry sector values for X. • Diversion of waste gas use to producing electricity – rate of waste gas generation fixed a priori. in cases where there could be demand for power. Y. and – the waste gas utilisation for internal heating and steam generation cannot be less than the sectoral average in the country or region • CF: Correction Factor for gas quantity eligible for emission reduction = Minimum[(X-Z).Leakage • Due to use of displaced hydrocarbon fuel by other smaller power generators who currently use renewables.
then ERy(4) = (Baselinei * CF) .Emissions Reductions • In existing power plant where only fuel replacement occurs – ERy(1) = Baseline I * CF – PEy • In existing power plant where fuel replacement occurs along with additional power generation – ERy(2) = (Baseline I + Baseline II)* CF – PEy • In a Greenfield power plant connected to the grid or approximate emission reduction – ERy(3) = Baseline II* CF – PEy • If more than one of the above occurs.PEy Note: PEy = 0 18 .
Data Sources and Vintage • Fuel – Consumption. heat rate: Proprietary data – Emission factor : IPCC – Heat Rate : Proprietary data • Electricity delivered: Regional Electricity Board • Waste Gas: Proprietary data • Local level data: 3 years old or of lesser vintage • Regional level data: 5 years vintage 19 . Calorific value.
• Whether the Methodology has been completely defined • Transparency and Conservativeness has been taken into account • Is the Methodology correctly applied 20 Thank You .• Basic information regarding the project has been presented Next ….