Presentation Carbon Service Reduction

•Lahore
Factor AG & Carbon Services:
CDM Projects in the Cement

Sector
Factor AG  Stauffacherstrasse 45  CH-8004 Zürich  Switzerland

Phone: +41 44 298 28 00  Fax: +41 44 298 28 99  info@factorglobal.com
Carbon Services (Private) Limted  Al-Maalik 19 Davis Road  Lahore Pakistan
Phone +9242-6313235 & 36  Fax +9242-6312959  www.carbon.com.pk
Contents
1. Factor Company Profile

2. CDM Projects in the Cement Industry
3. Factor Track Record
4. Factor Track Record in Cement
Page 2 CDM Projects in the Cement Sector

Factor AG & Carbon Services
Factor AG
We advise on emissions trading – since 1999
Carbon Financing
Carbon Asset Development
Carbon Risk Management

Factor Consulting + Management

Factor Team
• Over 100 full time CDM and Carbon Finance Experts at Factor AG
• Operations include
- Headquarters in Zurich, Switzerland
- Subsidaries and Partner offices in:
- China
- India
- Brazil
- Romania
- Pakistan
- Germany
- USA
- Chile
- Russia

Track Record in a Nutshell (as of June 2007)
Carbon Financing Carbon Asset Development
• Executed transactions from • Over 20 registered CDM

initial offering to final Projects
contract
• Over 20 more at validation
• Transacted with the most
credible Buyers in the • Over 60 projects under
market development
• Over 15 Mt CO2 transacted • Total pipeline exceeding 20

since 2004 with a market Mt CO2 to 2012
value exceeding € 100
million

We do business with leading global firms...

Contents

3. Track Record
4. Track Record in Cement

Approved Methodologies for Cement Projects
Methodology Description Number of
Number registered
Projects
ACM5 (ver 3) Increasing the blend in cement production 36
AM33 (ver 2) Use of non-carbonated calcium sources in the raw 6

mix for cement processing
AM40 (ver 1.1) Use of alternative raw materials that contain 1

carbonates in clinker manufacturing in cement kilns
ACM15 Alternative raw materials that do not contain 0

(consolidating AM33 carbonates for clinker manufacturing in cement kilns
and AM40)
ACM3 (ver 7) Emission reduction through partial substitution of 16

fossil fuels with alternative fuels in cement
manufacture
AM24 (ver 2) Baseline methodology for greenhouse gas 11

reductions through waste heat recovery and
utilization for power generation at cement plants

ACM0005 - Increasing the Blend in Cement Production
• Applicable for projects, that increase the share of additives (i.e. reduce
the share of clinker beyond current practices in the country)
• Additives are defined as materials blended with clinker to produce

blended cement types and include fly ash, gypsum, slag, etc.
• Applicable under the following conditions

- There is no shortage of additives related to the lack of blending materials.
Project
- Participants should demonstrate that there is no alternative allocation or use
for the additional amount of additives used in the project activity. If the
surplus availability of additives is not substantiated the project emissions
reductions (ERs) will be discounted.
- This methodology is applicable to domestically sold output of the project
activity plant and excludes export of blended cement.
- Adequate data are available on cement types in the market.

ACM0015 - Using alternative raw materials in cement kilns
Applicable to
- project activities that use alternative raw materials that do not contain
carbonates (AMC) in cement kilns for the production of clinker. The AMC
partially or fully substitutes raw materials that contain calcium and/or
magnesium carbonates (e.g. limestone).
- existing as well as to greenfield plants
Under the following additional conditions:

- Use of alternative materials shall increase neither the capacity of clinker
production nor the lifetime of equipment
- Type and quality of produced clinker remain the same
- Alternative raw materials have never been used in the clinker manufacturing
facility prior to the implementation of the project activity;
- There is sufficient historical information about the clinker manufacturing
facility, the raw materials used, and energy performance of the kiln.
Is not applicable for the following activities:

- Energy efficiency initiatives for improvements in process equipment (up-grade
towers, grinding separators, burners, expert control systems, etc.);
- Fuel switching. See ACM0015 for more details.

ACM0003 - Partial substitution of fossil fuels with
alternative fuels or less carbon intensive fuels in cement
manufacture
Applicable to
• activities in the cement industry where fossil fuel(s) used in an existing

clinker production facility are partially replaced by one or more carbon
intensive fossil fuel(s) and/or alternative fuels.
The following conditions shall apply
- A significant investment is required to enable the use of the alternative fuel(s)

and/or the less carbon intensive fossil fuel(s);
- During the last three years prior to the start of the project activity, no
alternative fuels have been used in the project plant;
- The CO2 emissions reduction relates to CO2 emissions generated from fuel
combustion only and is unrelated to the CO2 emissions from decarbonisation
of raw materials (i.e. CaCO3 and MgCO3 bearing minerals);
- The methodology is applicable only for installed capacity (expressed in tons
clinker/year) that exists by the time of validation of the project activity.
- In case of project activities using biomass residues, renewable biomass or
biomass from dedicated plantations, additional applicability conditions apply

AM0024 - Waste Heat Recovery and Utilization for
Power Generation at cement plants
Applicable to project activities that use waste heat gas generated in clinker making
process (i.e. in the cement kilns) to produce electricity.
Applicable under the following conditions
- The electricity produced is used within the cement works where the proposed
project activity is located and excess electricity is supplied to the grid; no
electricity export to the grid in the baseline scenario (in case of existing
captive power plant);
- Electricity generated under the project activity displaces either grid electricity
or from an identified specific generation source. Identified specific generation
source could be either an existing captive power generation source or new
generation source;
- The grid or identified specific generation source option is clearly identifiable;
- Waste heat is only to be used in the project activity, etc.
NOT applicable to project activities
- Where the current use of waste heat or the identified alternative business as
usual use of waste heat is
- located outside of the clinker making process
- that affect process emissions from cement plants.
Contents


Factor Track Record:CDM Projects
stru- Function Volume Vintages Host Country Project Type
ent t CO2e
obal Mandates
ER Broker 300'000 2005-11 India Biomass energy
ER Broker 500 2004-13 Costa Rica Biomass energy
ER Broker 960'000 2008-12 Costa Rica Landfill gas
ER Broker 5'000 2005-11 India Solar energy
ER Broker 1'900'000 2005-12 Brasil Landfill gas
ER Broker 162'000 2004-12 India Hydro
ER Broker 810'000 2006-12 India Biodiesel
ER Broker 360'000 2007-12 India Energy efficiency
ER Broker 189'000 2007-12 India Biodiesel

nstru- Function Volume Vintages Host Country Project Type
ment
ER Broker t90'000
CO2e 2007-12 India Energy efficiency
ER Broker
lobal Mandates 300'000 2007-12 India Hydro
ER Broker 105'000 2008-12 India Fuel switch
ER Broker 1'015'000 2007-12 India Hydro
ER Broker 0 2006-12 India Fuel switch
ER Broker 400'000 2008-12 Mali Fuel switch
ER PDD 92'000 2007-12 Switzerland Biomass energy
ER Broker 150'000 2007-12 China Hydro
ER Broker 400'000 2008-12 China Hydro
ER Broker 120'000 2007-12 Brazil Fuel switch
ER Broker 50'000 2008-12 Indonesia Energy efficiency
ER Broker 50'000 2007-12 Indonesia Landfill gas
ER Broker 300'000 2008-12 Argentina Biomass energy
ER PIN 20'000 2007-2012 Nepal Solar energy

est
blic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia,
er 139'000 2008-12 Romania Fuel Switch, En.eff.
60'000 2008-12 Romania Energy efficiency
200'000 2008-12 Romania Biomass energy
5'000'000 2008-12 Romania N2O
300'000 2008-12 Estonia Methane recovery
200'000 2008-12 Estonia Biomass energy
1'000'000 2008-12 Bulgaria Biofuel, transportation
175'000 2008-12 Bulgaria Biofuel, energy efficiency
600'000 2008-12 Bulgaria Landfill gas
200'000 2008-12 Bulgaria Methane recovery
650'000 2008-12 Czech Republic Dist. Heating, Geotherm
238'000 - Czech Republic Fuel Switch, En.eff.
247'000 2008-12 Slovak Republic Energy efficiency
40'000 2008-12 Poland Energy efficiency
145'000 2008-12 Lithuania Energy efficiency
orth-East
rus (Kazakhstan)
West
FactorHungary,
ublic, Estonia, TrackLatvia,
Record: CDM
Lithuania, Projects
Poland, Romania, Slovakia, Slovenia,
ker 139'000 2008-12 Romania Fuel Switch, En.eff.

200'000 2008-12 Romania Biomass energy
5'000'000 2008-12 Romania N2O
300'000 2008-12 Estonia Methane recovery
200'000 2008-12 Estonia Biomass energy
1'000'000 2008-12 Bulgaria Biofuel, transportation
175'000 2008-12 Bulgaria Biofuel, energy efficiency
600'000 2008-12 Bulgaria Landfill gas
200'000 2008-12 Bulgaria Methane recovery
650'000 2008-12 Czech Republic Dist. Heating, Geotherm
D 238'000 - Czech Republic Fuel Switch, En.eff.
D 247'000 2008-12 Slovak Republic Energy efficiency
145'000 2008-12 Lithuania Energy efficiency
North-East
arus (Kazakhstan)
Factor Track Record: CDM Projects
e North-East
elarus (Kazakhstan)
1'380'000 2004-12 Russia Methane recovery
600'000 2008-12 Russia Flaring
2'800'000 2008-12 Russia Flaring
780'000 2008-12 Russia Industrial energy efficiency
465'000 2008-12 Russia Dist. Heating, fuel switch
r 280'000 2008-12 Russia Energy efficiency
r 960'000 2008-12 Russia Gas capture
2'200'000 2008-12 Ukraine Gas capture
990'000 2008-12 Ukraine Power, energy efficiency
590'000 2008-12 Ukraine Gas capture
620'000 2008-12 Ukraine Wind energy
200'000 2008-12 Ukraine Industrial energy efficiency
500'000 2004-12 Belarus Energy efficiency
350'000 2008-12 Kazakhstan Hydro power
50'000 2008-12 Kazakhstan Solar energy
e South-East
Azerbaijan, Georgia, Kyrgyz Republic, FYR Macedonia, Moldova, Turkmenistan,
a and Herzegovina, Serbia
Pageand
19 Montenegro, Tajikistan)
CDM Projects in the Cement Sector
Factor
e South-East Track Record: CDM Projects
Azerbaijan, Georgia, Kyrgyz Republic, FYR Macedonia, Moldova, Turkmenistan,
ia and Herzegovina, Serbia and Montenegro, Tajikistan)
r 500'000 2006-12 Tajikistan Hydro
r 350'000 2005-12 Tajikistan Hydro
r 0 2007-12 Moldova BioEthanol
1'000'000 2006-2012 Uzbekistan Hydro
1'800'000 2006-2012 Uzbekistan Power, energy efficiency
120'000 2006-2012 Uzbekistan Heating, energy efficiency
900'000 2006-2012 Uzbekistan Hydro power
500'000 2006-2012 Uzbekistan Lightning efficiency
500'000 2006-2012 Uzbekistan Transportation, fuel switch
350'000 2006-2012 Uzbekistan Dist.Heating, energy efficiency
20'000 2005- 2012 Kyrgyz Republic Energy efficiency
100'000 2006-2012 Kyrgyz Republic Housing
300'000 2006-2012 Kyrgyz Republic Biomass energy
51'118'500
mulation

Contents


Factor Track Record in Cement (cont.):
CDM Projects
• China: Developed 3 CDM projects for power generation from kiln waste
heat, and purchased the resulting carbon credits (ongoing).
• My Home Cement, India: Developed CDM-PDD for fly ash blending
project and supported sale of carbon credits (ongoing).
• Wietersdorfer + Peggauer Cement, 2003 (Austria): Prepare
comprehensive strategy on CO2 emissions trading in Europe, including:
Analysis of impacts of EU ETS on Austrian and European cement and lime
markets; evaluation of a planned capacity expansion project;
establishment of CO2 abatement cost curve; recommendations for policy
lobbying.
• Holcim, 2003: Study on CO2 emissions associated with global freight
transport of clinker and cement.
• Holcim, 2003: Study GHG emissions intensity of different building
materials, taking into account differences in amount of material required
per construction unit.
• Holcim: Supported PDD development for projects in Costa Rica,
Indonesia

CDM Projects
• Japan Cement Association: In the context of the Asia Pacific

Partnership for Climate Protection (AP6), Factor supported the Japan
Cement Association in developing a protocol for the calculation of CO2
emissions in the cement industry. The Protocol will be used by cement
companies in all AP6 countries for inventorying their CO2 emissions.
• Confidential Client: Supported identification and selection of CDM

projects in cement plants in South- and Southeast Asia (India, Indonesia,
Thailand, Vietnam).
• Confidential Client: Supported the revision of a baseline methodology

and project design document (PDD) for a proposed CDM project in Central
America.
• GTZ, India: Developing CDM methodology for cement sector in India

based on benchmarking principle. In cooperation with Indian Cement
Manufacturing Association (CMA) and National Council for Cement and
Building Materials (NCB) (ongoing).

CDM Projects
• Cembureau: Supported comprehensive CO2 benchmarking exercise for

all cement plants in Europe (ongoing).
• Cembureau, Heidelberg Cement, Holcim, Italcementi, Lafarge

(2002): Evaluation of mechanisms for allocation of CO2 emissions
allowances in the EU emissions trading scheme. Quantitative analysis of
allowance mechanisms with respect to impacts on European cement
markets.
• WBCSD Cement Sustainability Initiative (CSI), 2000-01: Cement

CO2 Protocol. Factor AG was responsible for developing the CO2 Protocol
guidance document and Excel-based calculation tool in accordance with
the decisions taken by the CSI group. The Protocol is available at
www.ghgprotocol.org.
• Confidential Client: Benchmarking of 700 cement companies worldwide

with respect to emissions of local air pollutants, using publicly available
data.

CDM Projects
• WBCSD Cement Sustainability Initiative (CSI): Revision of Cement

CO2 Protocol. In the CSI, a group of 15 leading cement companies
cooperate on global sustainability issues including climate change. The
CSI group comprises, among others, the following companies: Cemex,
HeidelbergCement, Holcim, Italcementi, Lafarge, RMC, and Secil. Factor
AG is mandated to provide support in revising the Cement CO2 Protocol.
The Protocol comprises a monitoring and reporting standard and an Excel-
based calculation tool for CO2 emissions in the cement industry. The
Protocol has become part of the Corporate GHG Protocol developed by the
WBCSD and the World Resources Institute.
• German Technical Cooperation (GTZ), 2004-05: We have conducted

a series of awareness building workshops on climate change and the CDM
project development for the cement, pulp and paper, and power sectors
and provided in-depth training for the largest petrochemical company in
India. Through this mandate, we provide continued support to several
cement companies in preparing CDM project documentation.

CDM Projects
• CDM Executive Board & Methodologies Panel of the UNFCCC, 2004-

06: Reviewed the baseline methodologies of the following CDM projects in
the cement industry:
- Birla project for increased blending, India
- Lafarge project for increased use of biomass fuels, Malaysia
- Indocement project for increased blending, Indonesia
- Indocement project for increased use of alternative fuels, Indonesia
- Taishan project for power generation from waste heat, China
– Grasim methodology for energy efficiency improvement in cement
plants

CDM Methodologies
• India:
- Developing new CDM methodology for cement based on benchmarking
(ongoing)
- In cooperation with Cement Manufacturer’s Association (CMA) and National
Council for Cement and Building Materials (NCB)
• Holcim:
- Supported CDM methodology for new cement kilns
• CDM Executive Board / UNFCCC:

- Reviewed various cement-related methodology submissions for the CDM-EB

Corporate Strategies
• WBCSD / CSI Cement CO2 Monitoring and Reporting Protocol

- CSI is a group of 15 leading cement companies (Holcim, Lafarge, Cemex,
Heidelberger, Italcementi, Secil, etc.)
- Factor supported the development of the CO2 monitoring and reporting protocol
for the CSI (2001 / 2004)
- This protocol is today the widest-used protocol in the cement industry globally
• Cembureau:
- Factor is supporting a CO2 benchmarking exercise covering all cement plants in
Europe (ongoing)
• Asia-Pacific Partnership for Climate (AP6):

- For Japan Cement Association, Factor supported development of a protocol to be
used for CO2 benchmarking among AP6 members

Contact Details
Factor Consulting + Management AG

Stauffacherstrasse 45  CH-8004 Zurich  Switzerland
Phone +41 44 298 28 00  Fax +41 44 298 28 99 
www.factorglobal.com
Carbon Services (Private) Limted

Al-Maalik 19 Davis Road  Lahore Pakistan
Phone +9242-6313235 & 36  Fax +9242-6312959 
www.carbon.com.pk

THANK YOU


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•Lahore

Factor AG & Carbon Services:

CDM Projects in the Cement

Factor AG  Stauffacherstrasse 45  CH-8004 Zürich  Switzerland

1. Factor Company Profile

Page 2 CDM Projects in the Cement Sector

Carbon Asset Development

Carbon Risk Management

Page 3 CDM Projects in the Cement Sector

Page 4 CDM Projects in the Cement Sector

Page 5 CDM Projects in the Cement Sector

Carbon Financing Carbon Asset Development

• Executed transactions from • Over 20 registered CDM

• Over 15 Mt CO2 transacted • Total pipeline exceeding 20

Page 6 CDM Projects in the Cement Sector

Page 7 CDM Projects in the Cement Sector

1. Factor Company Profile

Page 8 CDM Projects in the Cement Sector

AM33 (ver 2) Use of non-carbonated calcium sources in the raw 6

AM40 (ver 1.1) Use of alternative raw materials that contain 1

ACM15 Alternative raw materials that do not contain 0

ACM3 (ver 7) Emission reduction through partial substitution of 16

AM24 (ver 2) Baseline methodology for greenhouse gas 11

Page 9 CDM Projects in the Cement Sector

• Additives are defined as materials blended with clinker to produce

• Applicable under the following conditions

Page 10 CDM Projects in the Cement Sector

Under the following additional conditions:

Is not applicable for the following activities:

Page 11 CDM Projects in the Cement Sector

• activities in the cement industry where fossil fuel(s) used in an existing

The following conditions shall apply

- A significant investment is required to enable the use of the alternative fuel(s)

Page 12 CDM Projects in the Cement Sector

Applicable under the following conditions

1. Factor Company Profile

Page 14 CDM Projects in the Cement Sector

Page 15 CDM Projects in the Cement Sector

Page 16 CDM Projects in the Cement Sector

ker 139'000 2008-12 Romania Fuel Switch, En.eff.

Page 20 CDM Projects in the Cement Sector

1. Factor Company Profile

Page 21 CDM Projects in the Cement Sector

Page 22 CDM Projects in the Cement Sector

• Japan Cement Association: In the context of the Asia Pacific

• Confidential Client: Supported identification and selection of CDM

• Confidential Client: Supported the revision of a baseline methodology

• GTZ, India: Developing CDM methodology for cement sector in India

Page 23 CDM Projects in the Cement Sector

• Cembureau: Supported comprehensive CO2 benchmarking exercise for

• Cembureau, Heidelberg Cement, Holcim, Italcementi, Lafarge

• WBCSD Cement Sustainability Initiative (CSI), 2000-01: Cement

• Confidential Client: Benchmarking of 700 cement companies worldwide

Page 24 CDM Projects in the Cement Sector

• WBCSD Cement Sustainability Initiative (CSI): Revision of Cement

• German Technical Cooperation (GTZ), 2004-05: We have conducted

Page 25 CDM Projects in the Cement Sector

• CDM Executive Board & Methodologies Panel of the UNFCCC, 2004-

Page 26 CDM Projects in the Cement Sector

• CDM Executive Board / UNFCCC:

Page 27 CDM Projects in the Cement Sector

• WBCSD / CSI Cement CO2 Monitoring and Reporting Protocol

• Asia-Pacific Partnership for Climate (AP6):