Portfolio Projects

Presentation 3 for Sotik Tea CompanyHarrie Knoef

10-11th January 2008

www.btgworld.com

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Kyoto mechanisms Joint implementation (JI)

– Valid for countries who have emission reduction targets– Emission reduction projects between industrialised countries– Traded unit Emission Reduction Unit (ERU)– Mainly between East and Western Europe

Clean Development Mechanism (CDM)– Valid for countries who have no emission reduction targets– Emission reduction projects in developing countries– Projects are ‘additional to what otherwise would occur’– Traded unit Certified Emission Reductions (CER)

– ERUs and CERs are tonnes avoided CO2-eq emissions, used by governments and companies to fulfil their emission reduction targets

– 1 tonne CH4 = 21 tonne CO2eq, 1 tonne N2O = 310 CO2eq

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Voluntary carbon offset

Voluntary Emission Reductions (VERs)– VERs are tonnes avoided CO2-eq emissions, and can be

used by companies and individuals that wish to compensate their emissions voluntarily

– No relation to Kyoto protocol– Important standards are “Gold Standard”, “VER+” and

“Voluntary Carbon Standard (VCS)”– Standards refer to CDM methodologies– Generally, VERs have lower market value than CERs

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The CDM pipeline

Project design Document (PDD)– Definition of Project– Choice of baseline and monitoring methodology– Assessment of Additionality– Projection of Baseline Scenario– Calculation of expected Emission Reduction

Validation/registration– Letter of approval host country– Approval Executive Board

Monitoring– Yearly measurements and calculation of

emission reductions

Verification/certification

Issuance of CERs

Project Development

Design Doc.Methodology

Approval, Executive

Board

Implementation

Certification

CER

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CDM in Kenya, december 2008 Currently, one CDM project registered and six

in the verification processProject Type MW

35 MW Bagasse Based Cogeneration Project by Mumias Sugar Company Limited (MSCL)

Biomass energy 35.0

Sondu Miriu Hydro Power Project Hydro 60.0

Olkaria II Geothermal Expansion Project Geothermal 35.0

Conversion of the Kipevu Open Cycle Gas Turbine to a Combined Cycle Operation Project

EE supply side 35.0

Redevelopment of Tana Hydro Power Station Project Hydro 19.6

Optimisation of Kiambere Hydro Power Project Hydro 20.0

6 MW Bagasse Based Cogeneration Project Biomass energy 6.0

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BTG Bioheat’s portfolio approach

Project 1 Project XProject 2 ....

Credit Buyer

BTG BioHeatProject

Development

Investments & Trading

Host CountryGovernment

Negotiations

& Contracts

Contracts

creditsguaranty

funds

Proposal & transaction approvals

Camil

1,5 million euro

Dutch government

Brazil

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Advantages portfolio approach [1]

Project costs (Baseline, PDD, validation, verification etc.) are reduced

Large portfolio gives better negotiation position to sell credits

Owners of small projects can be paid competitive prices

Small projects that otherwise would not be attractive for CDM can enter portfolio

BTG & Bioheat take care of paperwork

Best price and conditions for participants

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Advantages portfolio approach [2]

Large potential of replication – JI projects in CEE– CDM in South and Latin America and Southeast Asia

A number of new portfolios are under development

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Case Study:JI-portfolio

Czech Republic

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Video Misha

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JI-portfolio Czech Republic

BTG, BTG Czech Republic and Bioheat International

implemented successfully the first JI-portfolio of fuel

Switch projects in Czech Republic

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Portfolio Development

After several years of preparation a contract with the Dutch Government was secured, signed by Minister of Economic Affairs, Annemarie Jorritsma (2001)

14 fuel switch projects (3 CHP units) and 520,000 t CO2-eqv in 2008-2012

Installation from 0,6-9 MWth, 1 MWe; total installed capacity 65 MWth

Total investment 35 mEUR. The value of the carbon credit contract is almost 5 mEuro.

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Portfolio Development

PRAGUEZlutice

Rostin

Stitna nad V.

Velky KarlovSlavicin

Nova Cerekev

Driten

Horni Plana

Zruc nad S.

BouzovJesenik

Zlate Hory

Bystrice nad P.

Pelhrimov

Trebic

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Case – TTS CHP plant, incl. ORC monitoring carbon credits

generated sold generated sold

GJ GJ MWh MWhtype m3 type t

sawdust 1031 bark 3500straw (t) 119 green woodchips 3560

sawdust 0 bark 2500brown woodchips 0 green woodchips 3213

sawdust 0 bark 0brown woodchips 0 green woodchips 3325

sawdust 538 bark 2000brown woodchips 0 green woodchips 3299

sawdust 0 bark 896brown woodchips 0 green woodchips 1500

sawdust 0 bark 0brown woodchips 0 green woodchips 0

sawdust 0 bark 0brown woodchips 0 green woodchips 0

sawdust 0 bark 0brown woodchips 0 green woodchips 0

sawdust 807 bark 750brown woodchips 0 green woodchips 0

sawdust 0 bark 2550brown woodchips 0 green woodchips 2638

sawdust 0 bark 2500brown woodchips 0 green woodchips 3229

sawdust 2098 bark 0brown woodchips 1650 green woodchips 958

sawdust 4474 bark 14696brown woodchips 1650 green woodchips 21722

straw 119

Heat Power FUEL

type type

January 16.682 16.682 439

265

February 10.472 10.472 454

265

439

454

287

March 6.302

April 11.137 11.137 287

6.302

May 5.195 5.195 111

0

June 0 0 0

0

111

0

0

July 0

August 0 0 0

0

September 2.280 2.280 61

October 10.914 10.914 312

74

November 13.448

December

304

TOTAL 91.517 91.517 2.308

2007

2.308

15.087 15.087 74

13.448 304

61

312

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See presentation 4, TTSCzech Republic

Success Stories

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Thank you for your attention!

Harrie Knoef

BTG biomass technology group BV

www.btgworld.com

Knoef@btgworld.com

Ph: +31-53-4861190