6 MW Wind Power Project in Gujarat by GPCL

PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03
CDM Executive Board
CLEAN DEVELOPMENT MECHANISM

PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD)
Version 03 - in effect as of: 22 December 2006
CONTENTS
A.
General description of the small scale 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 proposed small scale project activity
Annex 2: Information regarding public funding
Annex 3: Baseline information
Annex 4: Monitoring Information
Annex 5: Selection of Appropriate Benchmark
CDM Executive Board
Revision history of this document
Version
Number
01
02
03
Date
Description and reason of revision
21
January Initial adoption
2003
8 July 2005
The Board agreed to revise the CDM SSC PDD to reflect
guidance and clarifications provided by the Board since
version 01 of this document.
As a consequence, the guidelines for completing CDM SSC
PDD have been revised accordingly to version 2. The latest
version
can
be
found
at
<http://cdm.unfccc.int/Reference/Documents>.
22 December
The Board agreed to revise the CDM project design
2006
document for small-scale activities (CDM-SSC-PDD), taking
into account CDM-PDD and CDM-NM.
CDM Executive Board
SECTION A. General description of small-scale project activity

A.1
Title of the small-scale project activity:
6 MW wind power project in Gujarat by GPCL

Version: 04
Date: 15/06/2012
A.2.
Description of the small-scale project activity:
Gujarat Power Corporation Limited (GPCL) plans to develop a 6 MW wind power project in the state of
Gujarat in India. The project activity will involve development, supply, commissioning and operation of 4
Wind Turbine Generators (WTGs) of rated capacity 1500 kW each. The make of the machines used in the
wind farm is Suzlon (Model: S-82). The project activity will produce electricity which shall be supplied
to the state electricity utility in the state of Gujarat. The project activity will assist in promoting
sustainable development of the region by providing clean energy to the state electricity grid
The windfarm is connected by a 66 kV line to a 33/220 kV, 3 x 25 MVA capacity Shikarpur site
substation at Shikarpur. The Shikarpur site substation is connected to GETCOs Shivlakha substation.
Objective of the Project
The purpose of the project activity is to harness renewable wind energy for generation of electricity. The
project activity leads to reduction of anthropogenic emissions of greenhouse gases (GHGs) into the
atmosphere.
In the absence of the project activity the equivalent amount of electricity would have been generated from
the connected/ new power plants in the NEWNE grid, which are / will be predominantly based on fossil
fuels1. On the other hand the electricity generation from operation of WTGs is free from GHG emissions.
As per the applicable methodology, the baseline scenario for the project activity is the grid based
electricity system, which is also the pre-project scenario.
Nature of Project
The Project channels renewable resources in the region, thereby displacing non-renewable natural
resources and leading to sustainable development. Suzlon Energy Limited (Suzlon) will be the EPC
contractor for the Project. The Project is owned by GPCL and the generated electricity will be supplied to
Gujarat Urja Vikas Nigam Limited (GUVNL) under a long-term Power Purchase Agreement (PPA).
Contribution to sustainable development
The Ministry of Environment and Forests (MoEF), Govt. of India has formulated the following guidelines
for consideration of a CDM project.
1. Social well being:
1 http://www.cea.nic.in/reports/planning/cdm_co2/cdm_co2.htm
CDM Executive Board
The project activity will lead to the development of supporting infrastructure such as road
network etc., in the wind park location, the access to which is also provided to the local
population.
The project activity will lead to alleviation of poverty by establishing direct and indirect benefits
through employment generation and improved economic activities by strengthening of local grid
of the state electricity utility.
The project activity requires temporary and permanent, skilled and semi-skilled manpower at the
wind park; this will create additional employment opportunities in the region
2. Environmental well being:

The project activity employs renewable energy source for electricity generation instead of fossil
fuel based electricity generation which would have emitted gaseous, liquid and/or solid
effluents/wastes.
Being a renewable resource, using wind energy to generate electricity contributes to resource
conservation. Thus the project causes no negative impact on the surrounding environment and
contributes to environmental well-being. The solid waste generated during project
implementation is disposed in accordance with all applicable environmental laws and regulations.
3. Economic well being:

The use of a renewable energy source reduces the nations dependence on imported fossil fuels
and associated price variation thereby leading to increased energy security.
The generated electricity will be fed into the NEWNE grid through local grid, thereby improving
the grid frequency and availability of electricity to the local consumers (villagers & sub-urban
habitants) which will provide new opportunities for industries and economic activities to be setup
in the area thereby resulting in greater local employment, ultimately leading to overall
development.
4. Technological well being:

Increased interest in wind energy projects will further push R&D efforts by technology providers
to develop more efficient and better machinery in future.
A.3.
Project participants:
Name of Party involved ((host)

indicates a host Party)
Private and/or public

entity(ies) project participants
(*) (as applicable)
Kindly indicate if the Party

involved wishes to be
considered as project
participant (Yes/No)
India
(Host)
Gujarat Power Corporation Ltd.

(Public entity)
No
A.4.
Technical description of the small-scale project activity:

A.4.1. Location of the small-scale project activity:
CDM Executive Board
A.4.1.1.
Host Party(ies):
A.4.1.2.
Region/State/Province etc.:
India
Western Region/ Gujarat State

A.4.1.3.
City/Town/Community etc:
The project is located at villages Manaba and Pethapar, Kutch District in the state of Gujarat, India:
A.4.1.4.
Details of physical location, including information allowing the
unique identification of this small-scale project activity :
The project is spread over two villages, Manaba & Pethapar, in the Kutch district of Gujarat. The nearest
airport and railway station are located at a distance of 100 km from the project site in Bhuj.
Table 1 Individual WTG details
S.
No.
1
2
3
4
WTG No.
Date of
Site & Survey no.
Latitude
Commissioning
(dd0 mm' ss")
SEL/1500/10-11/1931
02.02.2011
S-255
23 19 17.5 N
SEL/1500/10-11/1930
02.02.2011
S-254
23 19 16.8 N
SEL/1500/10-11/1929
02.02.2011
2-253
23 18 57.6 N
SEL/1500/10-11/1928
02.02.2011
S-248
23 18 29.1 N
Location map of India and Gujarat state showing project site
Longitude
(dd0 mm' ss")
70 44 24.7 E
70 43 51.1 E
70 43 31.9 E
70 44 49.7 E
CDM Executive Board
A.4.2. Type and category(ies) and technology/measure of the small-scale project activity:
The type and category of project activity as per Appendix B to the simplified modalities and procedures
for small-scale CDM project activities are as under:
Sectoral Scope
Project Type
Project Category
: I Energy Industries (renewable/non-renewable sources).

: Renewable energy projects
: D, Grid connected renewable electricity generation
Methodology: AMS-I.D.: Grid connected renewable electricity generation --- Version 17.0
Technology employed in the project activity
Wind possesses considerable kinetic energy because of its motion at high speeds. When wind flows over
the blades of the wind turbine, the kinetic energy is transformed into mechanical energy through the
rotation of the turbine blades. This mechanical energy is converted into electricity through the generator.
The technology involved is clean as there are no GHG emissions associated with the generation of
electricity.
The project installs 4 units of Suzlon S-82 model WTGs, each with a generation capacity of 1.5 MW. The
average life time of the WTG is around 20 years as per the industry standards Technical specifications of
the WTG are furnished below:
Technical specifications of Suzlon S 82/1500kW
Rotor
Diameter
82 m
Installed electrical output
1500 kW
Cut-in wind speed
4 m/sec
Cut out wind speed
20 m/sec
Rotor swept area
5281 m2
Rotational speed
15.6/18.4 rpm
Rotor material
Epoxy bonded fibre glass
Gear Box
Type
One planetary stage/ Two helical stages
Gear ratio
1:95.09
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Nominal load
1650 kW
Type of cooling
Forced oil cooling lubrication system
Generator
Type
Single speed induction generator with slip rings variable motor resistance
via Suzlon-Flexi-Slip system
Rotation speed
1511 RPM
Rated Output
1500 kW
Rated Voltage
690 V AC
Frequency
50 Hz
Insulation
Class H
Technology transfer:
No technology transfer from other countries is involved in this project activity
A.4.3
Estimated amount of emission reductions over the chosen crediting period:
The total emissions reduction achieved during the 10-year crediting period amounts to 118,670 tonnes of
CO2e, as shown in the table below:
Years
Estimation of annual emission

reductions in tonnes of CO2 e
Year 1 (2012-2013)
Year 2 (2013-2014)
Year 3 (2014-2014)
Year 4 (2015-2016)
Year 5 (2016-2017)
Year 6 (2017-2018)
Year 7 (2018-2019)
Year 8 (2019-2020)
Year 9 (2020-2021)
Year 10 (2021-2022)
11,867
11,867
11,867
11,867
11,867
11,867
11,867
11,867
11,867
11,867
Total estimated reductions (tonnes of CO2 e)
118,670
Total number of crediting years
10
Annual average of the estimated reductions

over the crediting period (t CO2 e)
11,867
CDM Executive Board
A.4.4. Public funding of the small-scale project activity:

There is no public funding involved in this project
A.4.5. Confirmation that the small-scale project activity is not a debundled component of a
large scale project activity:
As per the guidelines on assessment of debundling for SSC project activities version 3 (EB 54 Annex
13),
A proposed small-scale project activity shall be deemed to be a debundled component of a large project
activity if there is a registered small-scale CDM project activity or an application to register another
small-scale CDM project activity:
with the same project participants
in the same category and technology/measure; and
registered within the previous 2 years
whose project boundary is within 1 km of project boundary of the proposed small scale project
activity at the closest point
This is the first CDM project by GPCL. The project participant does not have any registered CDM project
activity in the same region in the same category and technology. GPCL has implemented a 10.5 MW
wind power project in Kutch & Patan district, Gujarat and a 5MW solar PV power project at Solar Park,
Village Charanka, Taluka Santalpur in Patan District of Gujarat.
These projects are not registered CDM projects within the previous 2 years (GPCL has sent the prior
intimation forms to UNFCCC and intends to get these project registered under CDM) and the project
boundaries of these two projects are not within 1 km of the proposed small scale project activity at the
closest point. Also, the solar PV power project does not belong to the same technology/measure category
as the project activity.
The same is shown in the flow chart below:
CDM Executive Board
Thus, the project activity is not a de-bundled component of a large scale project activity.
SECTION B. Application of a baseline and monitoring methodology
B.1.
Title and reference of the approved baseline and monitoring methodology applied to the
small-scale project activity:
Title: AMS I.D (grid connected renewable electricity generation), version 17, EB 612
Reference: Appendix B of the Simplified Modalities and Procedures for small-scale project activities.
The following tools and guidelines are used in this document:
1. Tool to calculate the emission factor for an electricity system Version 02.2.1, EB 63, Annex 19
(source: http://cdm.unfccc.int/methodologies/PAmethodologies/tools/am-tool-07-v2.2.1.pdf)
2. Guidelines on the Assessment of Investment Analysis Version 05.0, EB 62, Annex 5 (source:
http://cdm.unfccc.int/Reference/Guidclarif/reg/reg_guid03.pdf )
A of Appendix B version 08, EB
http://dm.unfccc.int/Reference/Guidclarif/ssc/methSSC_guid05.pdf)
3. Attachment
B.2
63,
Annex
24
(source:
Justification of the choice of the project category:
The approved small scale methodology AMS-I.D Version 17 is the choice of the baseline and monitoring
methodology and is applicable because:
2
http://cdm.unfccc.int/UserManagement/FileStorage/V9LRSXKP24Q7YT6HZDUBO3C0ING8AJ
CDM Executive Board
Para No.
Applicability Conditions as per AMS-I.D
Version 17
Para 1.
- This methodology comprises renewable energy

generation units, such as photovoltaic, hydro,
tidal/wave, wind, geothermal and renewable biomass:
a) Supplying electricity to a national or a
regional grid; or
b) Supplying electricity to an identified
consumer facility via national/regional grid
through a contractual arrangement such as
wheeling.
Para 2
- Illustration of respective situations under which each of

the methodology (i.e. AMS-I.D, AMS-I.F and AMSI.A) applies is included in Table 2
- Table 2: Applicability of AMS-I.D, AMS-I.F and

AMS-I.A based on project types:
Applicability to this Project

Activity
The project activity involves
installation of a new wind energy
power plant.
The project activity supplies
electricity to the state grid of
Gujarat, which forms a part of the
NEWNE regional grid.
Applicability criterion is
fulfilled.
Yes, the project activity supplies
electricity to a national grid
(NEWNE grid).
fulfilled.
- 1. Project supplies electricity to a national/regional grid

(AMS-I.D)
2. Project displaces grid electricity consumption (e.g.
grid import) and/or captive fossil fuel electricity
generation at the user end (excess electricity may be
supplied to a grid) (AMS-I.F)
3. Project supplies electricity to an identified consumer
facility via national/regional grid (through a contractual
arrangement such as wheeling) (AMS-I.D)
- 4. Project supplies electricity to a mini grid system

where in the baseline all generators use exclusively fuel
oil and/or diesel fuel (AMS-I.F)
- 5. Project supplies electricity to household users

(included in the project boundary) located in off grid
areas (AMS-I.A)
Para 3.
This methodology is applicable to project activities

that: (a) Install a new power plant at a site where
there was no renewable energy power plant operating
prior to the implementation of the project activity
(Greenfield plant); (b) Involve a capacity addition; (c)
Involve a retrofit of (an) existing plant(s); or (d)
Involve a replacement of (an) existing plant(s).
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The project activity is installation

of new power plant (energy
generation from wind) where
there was no renewable energy
power plant operating prior to the
implementation of the project
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activity (Greenfield plant)

fulfilled.
Para 4.
Hydro power plants with reservoirs that satisfy at least

one of the following conditions are eligible to apply
this methodology:
a) The project activity is implemented in an
existing reservoir with no change in the
volume of reservoir;
b) The project activity is implemented in an
existing reservoir, where the volume of
reservoir is increased and the power density
of the project activity, as per definitions given
in the project emissions section, is greater
than 4 W/m2;

power plant.
This condition is not relevant, as
the project activity is not the
installation of a hydro power
plant.
Applicability criterion is not
relevant.
c) The project activity results in new reservoirs

and the power density of the power plant, as
per definitions given in the project emissions
section, is greater than 4 W/m2.
Para 5.
If the new unit has both renewable and non-renewable
components (e.g. a wind/diesel unit), the eligibility
limit of 15 MW for a small-scale CDM project
activity applies only to the renewable component. If
the new unit co-fires fossil fuel, the capacity of the
entire unit shall not exceed the limit of 15 MW.

power plant. The capacity of the
project activity is 6 MW, which is
within the eligibility limit for a
small-scale CDM project activity
The project activity does not
involve both renewable and nonrenewable components.
relevant.
Para 6.
Combined heat and power (co-generation) systems are

not eligible under this category.

power plant. The project activity
does not involve co-generation
power plant installation.
fulfilled.
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Para 7.
In the case of project activities that involve the

addition of renewable energy generation units at an
existing renewable power generation facility, the
added capacity of the units added by the project
should be lower than 15 MW and should be physically
distinct from the existing units.

does not involve any capacity
addition to an existing renewable
power generation facility.
relevant.
Para 8.
In the case of retrofit or replacement, to qualify as a

small-scale project, the total output of the retrofitted
or replacement unit shall not exceed the limit of
15 MW.

does not involve any retrofit or
replacement.
relevant.
The above comparison confirms that the chosen methodology is applicable for this project activity.
The project proponent hereby confirms that the capacity of the project activity will not exceed 15 MW
during the entire crediting period.
B.3.
Description of the project boundary:
As per the approved small scale methodology AMS I.D, the spatial extent of the project boundary
includes the project power plant and all power plants connected physically to the electricity system that
the CDM project power plant is connected to.
The significant anthropogenic emissions attributable to the project activity are listed in the table below.
Table 2 Emissions sources included in or excluded from the project boundary
Project Activity
Baseline
Source
Gas
Included?
Justification / Explanation
CO2
Yes
Main emission source.
Grid
electricity
CH4
generation
No
N2O
No
CO2
No
CH4
No
N2O
No
Electricity
generation from
Wind Turbine
Generators.
12
Excluded for simplification. This is

negligible.
Excluded for simplification. This is
negligible.
The project activity does not emit
any CO2 emissions
No methane generation is expected
to be emitted.
No nitrous oxide generation is
expected to be emitted.
CDM Executive Board
The project boundary thus includes the 4 WTGs, the metering equipment for each WTG and substation,
and the grid which is used to transmit the generated electricity. The project is supplying the generated
electricity to the NEWNE regional grid, thus the NEWNE grid has been chosen as the grid system for the
baseline calculation.
The windfarm is connected by 66 kV line to 33/220 kV, 3 x 25 MVA capacity Shikarpur site substation at
Shikarpur. The Shikarpur site substation is connected to GETCOs Shivlakha substation.
Figure below demonstrates the project boundary for the proposed project activity:
B.4.
Description of baseline and its development:
The methodology applicable to the proposed CDM project activity is AMS- I.D. (Version 17).
Accordingly, the baseline scenario being considered is as directed in paragraph 10 of AMS- I.D. (Version
17). The proposed CDM project activity is the installation of a new grid-connected renewable power
plant/unit and hence the baseline scenario is that the electricity delivered to the grid by the project activity
would have otherwise been generated by the operation of grid-connected power plants and by the addition
of new generation sources into the grid.
The wind energy power plant is located in the state of Gujarat and connected to NEWNE grid.
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CDM Executive Board
For the proposed CDM project activity, as per paragraph 11 of AMS- I.D. (Version 17), the baseline
emissions are the product of electrical energy baseline EGBL,y expressed in MWh of electricity produced
by the renewable generating unit multiplied by the grid emission factor.
BEy = EGBL,y * EFCO2,grid,y
Where:
BEy
EGBL,y
EFCO2,grid,y
Baseline Emissions in year y; t CO2

Quantity of net electricity supplied to the grid as a result of the implementation of the
CDM project activity in year y; MWh
CO2 emission factor of the grid in year y; t CO2/MWh
As per paragraph 12 of the AMS- I.D. (Version 17), the Emission Factor (EFCO2,grid,y) can be calculated in
a transparent and conservative manner as follows:
(a) A combined margin (CM), consisting of the combination of operating margin (OM) and build
margin (BM) according to the procedures prescribed in the Tool to calculate the emission factor
for an electricity system.
OR
(b) The weighted average emissions (in t CO2/MWh) of the current generation mix. The data of the
year in which project generation occurs must be used.
The applicable methodology also states that, calculations must be based on data from an official source
(where available) and made publicly available. With the purpose of providing a ready reference for the
emission coefficients to be used in CDM projects, the Government of India, has published, CO2 Baseline
Database for the Indian Power Sector, Version 6.0, March 2011. This database is an official publication
of the Government of India for the purpose of CDM baselines. It is based on the most recent data
available with the Central Electricity Authority (CEA), Government of India.
The project proponents selected Combined Margin (CM) ex ante approach to calculate emission
coefficient (measured in t CO2/MWh) based on the publicly available data from official source.
Following information is used for determination of baseline emissions:
Variable
EGBL,y = Quantity of net electricity
generation that is produced and fed into
the grid as a result of the implementation
of the CDM project activity in year y
(MWh/yr)
Parameter
EFOM, y = Operating Margin Emission
Factor for NEWNE grid in year y
(tCO2/MWh)
EFBM, y = Build Margin Emission Factor
for NEWNE grid in year y (tCO2/MWh)
Data Source
Certificate for share of electricity generated by wind farm
issued by state utility, hereafter referred as (Share certificate)
Data Source
Baseline Carbon Dioxide Emission Database Version 6.0 from
the Central Electricity Authority website
http://www.cea.nic.in/reports/planning/cdm_co2/cdm_co2.htm
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CDM Executive Board
EFCM.y = Combined Margin Emission

Factor for NEWNE Grid in year y
(tCO2/MWh)
Calculated as the weighted average of the operating margin

and build margin.
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 small-scale CDM project activity:
National policies and circumstances relevant to the baseline3:
1) Baseline CO2 database Version 06 Central Electricity Authority
2) Gujarat Electricity Regulatory Commission (GERC Tariff Order - 2010)
3) Electricity Act 2003
The Electricity Act, 2003 provides an enabling framework for accelerated and more efficient
development of the power sector. The Act seeks to encourage competition with appropriate regulatory
intervention. Competition is expected to yield efficiency gains and in turn result in availability of quality
supply of electricity to consumers at competitive rates.
The Section 3 (1) of the Electricity Act 2003 requires the Central Government to formulate, inter alia, the
National Electricity Policy in consultation with Central Electricity Authority (CEA) and State
Governments. The provision is quoted below:
"The Central Government shall, from time to time, prepare the National Electricity Policy and tariff
policy, in consultation with the State Governments and the Authority for development of the power system
based on optimal utilization of resources such as coal, natural gas, nuclear substances or materials,
hydro and renewable sources of energy".
Further, as per section 5.2.12 of the National Electricity Plan:
Even with full development of the feasible hydro potential in the country, coal would necessarily continue
to remain the primary fuel for meeting future electricity demand.
The National Electricity Plan also emphasizes the use of other fossil fuel like gas, LNG, Lignite, other
imported fossil fuels in meeting the future electricity need. It further emphasize on the Renovation and
Modernization (R&M) of the low performing thermal power stations in the country. This will enable to
achieve improved PLF of the thermal power plant.
In the absence of this project activity, electricity would have been generated from the present fossil fuel
mix in the NEWNE grid. The NEWNE grid is dominated by fossil fuel fired power plants and thus this
project reduce the anthropogenic emissions of greenhouse gases (GHGs) in to the atmosphere associated
with the equivalent amount of electricity generation. Wind power development in India has been
3
http://www.powermin.nic.in/JSP_SERVLETS/internal.jsp
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CDM Executive Board
promoted since July 1995 (Source: http://www.mnre.gov.in/prog-wind.htm) but there are no national or
local laws or regulations that mandate this investment i.e. setting up of wind power projects. Setting up of
wind power projects is a voluntary activity.
Demonstration of Additionality
The additionality is being demonstrated using Attachment A to Appendix B of the Simplified Modalities
and Procedures for CDM Small Scale Project Activities (attachment A to appendix B, EB 63, Annex
24)4. As per paragraph 1 of EB 63 Annex 24,
Project participants shall provide an explanation to show that the project activity would not have
occurred anyway due to at least one of the following barriers:
(a) Investment barrier: a financially more viable alternative to the project activity would have led to
higher emissions;
(b) Technological barrier: a less technologically advanced alternative to the project activity involves
lower risks due to the performance uncertainty or low market share of the new technology adopted for the
project activity and so would have led to higher emissions;
(c) Barrier due to prevailing practice: prevailing practice or existing regulatory or policy requirements
would have led to implementation of a technology with higher emissions;
(d) Other barriers: without the project activity, for another specific reason identified by the project
participant, such as institutional barriers or limited information, managerial resources, organizational
capacity, financial resources, or capacity to absorb new technologies, emissions would have been higher.
From the list of barriers listed above, the project proponent proposes to demonstrate the additionality of
the project activity by using Option a Investment barrier.
The financial indicator that is identified is the post-tax Equity IRR.
Investment Barrier
For Sub-step 2a of Tool for the demonstration and assessment of Additionality, an appropriate analysis
method from simple cost analysis, investment comparison analysis or benchmark analysis needs to be
determined.
Since the project activity will generate financial income from sale of power to the grid, we shall rule out
Option I (simple cost analysis) and apply either Option II (Investment comparison analysis) or Option III
(Benchmark analysis).
As per Guidelines on the Assessment of Investment Analysis (EB 62, Annex 5), Guidance 19
If the proposed baseline scenario leaves the project participant no other choice than to make an
investment to supply the same (or substitute) products or services, a benchmark analysis is not
appropriate and an investment comparison analysis shall be used. If the alternative to the project activity
is the supply of electricity from a grid this is not to be considered an investment and a benchmark
approach is considered appropriate.
https://cdm.unfccc.int/Reference/Guidclarif/ssc/methSSC_guid05.pdf
16
CDM Executive Board
In absence of the project activity the equivalent power would have been generated from the power plants
connected to the NEWNE Grid. Hence, Option III (Benchmark analysis) is selected as the appropriate
method for demonstration of Investment analysis.
The project proponent has chosen to demonstrate additionality by way of a benchmark analysis. The posttax Equity IRR was chosen as the appropriate financial indicator to demonstrate the additionality of the
project.
Appropriateness of financial indicator
Post-tax Equity IRR is a widely accepted financial metric used by many corporations and financial
institutions for investment decision-making and is a long-established benchmark for investment decisions
in the Indian power sector. Hence post-tax Equity IRR is chosen as the appropriate financial indicator for
carrying out the investment analysis.
Appropriateness of Benchmark
The project is a greenfield wind electricity generation project. In accordance with the guidance on
assessment of investment analysis (version 05.0) Para 13, EB 62 Annex 05, the cases of projects which
could be developed by an entity other than the project participant the benchmark should be based on
publicly available data sources which can be clearly validated by the DOE. Accordingly, the external
benchmark has been calculated using publically available financial data that is applicable at the time of
investment decision making. As per Para12 EB62 Annex 5, return on equity is an appropriate benchmark
for post-tax equity IRR accordingly same has been considered.
Calculation of Benchmark
The return on equity has been calculated as per the Capital Asset Pricing Model method. The benchmark
has been calculated as follows:
Ke = Rf + B x (Rm - Rf)
Where: Ke = Rate of return on equity; Rf = Risk-free rate of return; B = Beta; Rm = Market return
The benchmark return on equity for the project using CAPM works out to be 16.38 %.
Further details of the benchmark computation using CAPM have been provided in Annex 5.
In the webhosted PDD, the benchmark return on equity had been calculated using the default values for
the approximate expected return on equity for different project types and host countries as provided in the
appendix to Guidelines on the assessment of investment analysis, EB 62, Annex 5.This value (default
real return on equity) was obtained by looking at the respective value for India corresponding to Group 1
(Energy Industries). The nominal benchmark (after incorporating inflation) in line with Guidelines on
the assessment of investment analysis, EB 62, Annex 5 worked out to be 17.34%5.
The default value for the expected return on equity (in real terms): 11.75%
Also, as per Para 7 of the appendix to Guidelines on the assessment of investment analysis, EB 62, Annex 5
In situations where an investment analysis is carried out in nominal terms, project participants can convert the
real term values provided in the table below to nominal values by adding the inflation rate. The inflation rate shall
be obtained from the inflation forecast of the central bank of the host country for the duration of the crediting
period.
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CDM Executive Board
Since the above guideline was not available at the time of investment decision (20th August 2010), the
benchmark return on equity calculated using CAPM has been conservatively taken as the applicable
benchmark.
Therefore, the applicable benchmark return on equity for the project is 16.38 %.
The decision to invest in the project activity was taken on 20th August 2010 vide Approval by GPCLs
Managing Director. The approval acknowledged that the project does not generate sufficient returns
without taking into account CDM revenue and the approval for investment in the project has been given
upon considering CDM revenue in the cash flows.
Key assumptions used for calculating post-tax Equity IRR in line with Para 6 of EB62 Annex 5 are set out
below:
Basis
Assumptions for Financial Model

Capacity of Machines in Kw
Number of Machines
Project Capacity in MW
Expected project commissioning date
Operation & Maintenance 4th year (free
for first 3 years)
% of escalation per annum on O & M
Charges
Plant Load Factor
Tariff
Base year Tariff fixed for the lifetime of
the project - Rs./KWh
Project Cost
1500
4
6.0
02-Feb-11
INR 6.067 million
5%
23.8%
3.56
Suzlon offer dated 08.03.2010

Letter from Suzlon dated 10.03.2010 (#
SEL:AHD:MKTG:AD:750)
Letter from Suzlon dated 10.03.2010 (#
SEL:AHD:MKTG:AD:750)
Third party assessment report
GERC Tariff Order 30.01.2010
INR million
Total Project Cost
356.292
Means of Finance
Own Source
Term laon
Total Source
INR Million
356.292 (100%)
0 (0%)
356.292
Income Tax Depreciation Rate (SLM)

on WTGs (Accelerated depreciation)
80%6
4.50%
Book Depreciation Rate (SLM)
Income Tax Act

Companies Act:
Straight Line method (90% depreciation
According to the Reserve Bank of Indias Survey of Professional Forecasters: Results of Twelfth Round (Q1:201011) dated 5th August 20105, WPI based inflation is expected to be 5.0 per cent over the next ten years.
Benchmark = (1 + Expected return on equity (in real terms)) * (1 + Inflation rate) - 1
= (1 + 11.75%) * (1 + 5%) - 1
= 17.34%
6
www.taxclubindia.com/simple/depincometax.rtf
(Please refer to point no. A8xiiil for reference to 80%)
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CDM Executive Board
Book Depreciation up to (% of asset value)

Salvage value
Income Tax
Income Tax rate
90%
10%
33.2175%
assumed over 20 years)

Companies Act7
Companies Act
:Remaining value after depreciation
Income Tax Act8
The post-tax equity IRR for the Project without CDM revenues is 9.51% i.e. less than the benchmark.
Sensitivity Analysis
As per the Guidance to investment analysis EB 62 Annex 5 Para 20 Only variables, including the initial
investment cost, that constitute more than 20% of either total project costs or total project revenues should
be subjected to reasonable variation (all parameters varied need not necessarily be subjected to both
negative and positive variations of the same magnitude), and the results of this variation should be
presented in the PDD and be reproducible in the associated spreadsheets
The critical parameters to which the project activity is sensitive are mentioned below:
Capital Cost
Plant Load Factor
O&M cost
Tariff
Rest all other parameters have less than 20% impact on the project revenues/project expenses, so their
impact on post-tax equity IRR is very insignificant and hence these parameters have not been considered
for sensitivity analysis. A detailed explanation of the range of values of parameters considered for the
sensitivity analysis is presented below:
Capital Cost
The project cost taken in the investment analysis is based on the price offer given by Suzlon. In
accordance with the Guidance on assessment for investment analysis the sensitivity has been conducted at
a variation 10% of the project cost.
10% decrease in Capital Capital Cost (Base) 10% increase in Capital
Cost (INR 320.663 (INR 356.292 million)
Cost (INR 391.922
million)
million)
Post-tax equity IRR
11.18%
9.51%
Refer to point no. 8 (http://www.icai.org/resource_file/11398p012-14.pdf)
30% Income tax rate + 7.5% Surcharge + 3% Education Cess (Applicable for FY 2010-11)
8.10%
Refer Page 38, http://www.cercind.gov.in/2010/November/Signed_Order_256-2010_RE_Tariff_FY_11-12.pdf
19
CDM Executive Board
Plant Load Factor

Plant Load Factor is the key variable encompassing variation in wind profile. Sensitivity has been
conducted for a variation of 10% over the base case.
10% decrease in PLF
(21.4%)
Post-tax equity IRR
Base PLF (23.8%)
7.71%
9.51%
10% increase in PLF

(26.2%)
11.26%
O&M Cost
The O&M cost taken in the investment analysis is based on the price offer submitted by Suzlon. In
accordance with the Guidance on assessment for investment analysis the sensitivity in O&M cost has
been conducted for a variation of 10% over the base case.
10% decrease in O&M O&M Cost (Base) (INR 10% increase in O&M
cost (INR 5.46 million)
6.067 million)
cost (INR 6.67 million)
Post-tax equity IRR
9.75%
9.51%
9.27%
Tariff
As per Gujarat Electricity Regulatory Commission (GERC) Tariff Order dated 30.01.2010 applicable at
time of investment decision, tariff for entire lifetime of wind power projects has been fixed at Rs. 3.56 per
Unit. Therefore sensitivity on tariff is not applicable.
Even though the tariff is fixed for the lifetime of the project the sensitivity analysis has been carried out at
10% variation over base case and the results are presented below
10% decrease in Tariff Base Tariff (INR 3.56)
(INR 3.2)
Post-tax equity IRR
7.71%
9.51%
10% increase in tariff

(INR 3.92)
11.26%
The sensitivity analysis clearly shows even with a 10% variation in key parameters, the project is not able
to generate sufficient returns. It can therefore be concluded that the project is financially not viable
without CDM benefits.
Sensitivity analysis has been performed for the parameters to analyse the value at which they cross the
benchmark. The results are tabulated below:
Parameter
Plant Load Factor @ 33.8%

(42% higher than base PLF)
Post-tax
equity IRR %
16.39%
Comments
The Post-tax equity IRR crosses the benchmark at PLF

of 33.8%, which is 42% higher than the estimated base
PLF, which is highly unlikely scenario. The probability
of occurrence of such a high annual PLF is very low as
the recommended value as per GERC tariff order dated
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CDM Executive Board
11th August 2006 is 23% and the maximum achieved.

Moreover, the actual PLF achieved by the project in the
period February 2011 to January 2012 is 19.81%.
O&M Expenses @ Nil (100% 11.72 %

reduction)
The Post-tax equity IRR does not cross the benchmark

even if O&M expenses are taken to be nil.
Capital cost @ 240.50 Million 16.38 %

(32.50% reduction in capital
cost)
The Post-tax equity IRR crosses the benchmark at a

reduced capital cost of INR 240.50 million which is a
32.50% reduction from the base value. This is also a
very unlikely scenario as the final purchase order price
is INR 353.07 million, a 0.906% reduction in cost.
Tariff @ INR 5.06 (42% 16.39 %

higher than base tariff)
The Post-tax equity IRR crosses the benchmark at

Tariff of INR 5.06 which is 42% higher than the base
Tariff, which is highly unlikely scenario as in the PPA
the tariff is fixed for the lifetime of the project.
As can be seen, the post-tax equity IRR of the project activity remains well below the benchmark even
under the sensitivity analysis. Therefore it can be concluded that the proposed CDM project activity is
unlikely to be the most financially/economically attractive. Hence, the project activity is additional. The
project participant has considered CDM as a source of revenue to improve financial viability of the
project and had decided to invest in the project on this consideration
Prior consideration of CDM
The project activity has been conceived as a CDM project since its inception. The Project Participant (PP)
notified the UNFCCC and the DNA on 3rd February 2011 about the project activity initiative which is
within 6 months after the project start date of 20th August 2010, and hence qualifies the CDM prior
consideration criteria of intimating within a period of six months before or after the start date of the
project activity.
The chronology of events for demonstration prior consideration of CDM is shown in table below:
Event
Documentary Evidence
Date
Suzlons offer
Offer
8.03.2010
Suzlons clarification letter on O&M

charges
Clarification letter
10.03.2010
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CDM Executive Board
MDs approval for the project (CDM

consideration)9
Note
19.05.2010
MDs approval based on PLF estimate

by third party10
Note
20.08.2010
Placement of Purchase order for WTGs

to Suzlon
Purchase Order
20.08.2010
Finalisation and appointment of CDM

consultant
Engagement Letter from PwC
21.12.2010
Commissioning of the project activity
Commissioning certificate
02.02.2011
Prior consideration of CDM notification

submitted to the UNFCCC and host
country DNA
Notification Letter
03.02.2011
Local stakeholder meeting for the wind

power CDM project
Minutes of local stakeholder meeting
25.05.2011
Global stakeholder consultation
UNFCCC website
November 2011
B.6.
Emission reductions:
B.6.1. Explanation of methodological choices:
According to the approved methodology AMS-I.D Version 17 para 23 (equation (10)), Emission
reductions are calculated as follows:
ERy = BEy PEy LEy.. (1)
Where: ERy: Emission reductions in year y (t CO2/y)
BEy: Baseline Emissions in year y (t CO2/y)
PEy: Project emissions in year y (t CO2/y)
LEy: Leakage emissions in year y (t CO2/y)
According to the approved methodology AMS-I.D Version 17 para 11 (equation (1)), Baseline Emissions
for the amount of electricity supplied by project activity, BEy is calculated as
BEy = EGBL,y * EFCO2,grid,y .. (2)
Where:
BEy
EGBL,y
Baseline Emissions in year y; t CO2

Quantity of net electricity supplied to the grid as a result of the implementation of the
CDM project activity in year y; MWh
The first approval was based on offer from Suzlon (dated 8.03.2010) for two sites: Jangi/ Ambliyara and
Shikarpur. The PLF assumption was taken from GERC tariff order. It was decided to undertake a third party
assessment for the plant load factor so as to get a better estimate of the generation.
10
The final approval was based on the PLF assessment carried out for the two offered sites.
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CDM Executive Board
EFCO2,grid,y
A.
CO2 emission factor of the grid in year y; t CO2/MWh
Calculation of net electricity supplied to the grid
Ex-ante calculation of net electricity supplied to the grid as a result of the implementation of the CDM
project activity is as follows
EGBL,y = Capacity x PLF x Generating Hour (in a year) .. (3)
During verification, the quantity of net electricity supplied to grid would be taken from the certificate of
share of electricity provided by state utility.
B.
Calculation of CO2 emission factor of grid
According to AMS-I.D Version 17, the baseline emissions are the product of electrical energy baseline
EGBL, y expressed in MWh of electricity produced by the renewable generating unit multiplied by the grid
emission factor which can be calculated in a transparent and conservative manner as:
(a) A combined margin (CM), consisting of the combination of operating margin (OM) and build margin
(BM) according to the procedures prescribed in the Tool to calculate the emission factor for an electricity
system
OR
(b) The weighted average emissions (in kg CO2e/kWh) of the current generation mix. The data of the
year in which project generation occurs must be used.
The project proponents have chosen the combined margin approach to calculate the emission coefficient
for the grid. According to the tool to calculate emission factor for an electricity system the baseline
emission coefficient (Version 02.2.1) will be determined using the following steps:
STEP 1. Identifying the relevant electricity systems
Historically, the Indian power system was divided into five independent regional grids, namely Northern,
Eastern, Western, Southern, and North-Eastern. Each grid covered several states. Since August 2006,
however, all regional grids except the Southern Grid have been integrated and are operating in
synchronous mode, i.e. at same frequency. Consequently, the Northern, Eastern, Western and NorthEastern grids will be treated as a single grid and is being named as NEWNE grid from FY 2007-08
onwards as depicted in the CO2 Baseline Database. The Southern grid has also been planned to be
synchronously operated with rest of all Indian Grid by early 12th Plan (2012-2017).
Northern
NEWNE Grid
Eastern
Western
North-Eastern
Southern Grid
Southern
Chandigarh
Bihar
Chhattisgarh
Arunachal
Pradesh
Andhra Pradesh
Delhi
Jharkhand
Gujarat
Assam
Karnataka
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CDM Executive Board
Haryana
Orissa
Daman & Diu
Manipur
Kerala
Himachal
Pradesh
West Bengal
Dadar and Nagar

Haveli
Meghalaya
Tamil Nadu
Jammu &
Kashmir
Sikkim
Madhya Pradesh
Mizoram
Pondicherry
Punjab
AndamanNicobar
Maharashtra
Nagaland
Lakshadweep
Goa
Tripura
Rajasthan
Uttar Pradesh
Uttarakhand
As the Project is connected to the NEWNE electricity grid, the same is the project electricity system.
STEP 2. Choose whether to include off-grid power plants in the project electricity system (optional)
Project participants may choose between the following two options to calculate the operating margin and
build margin emission factor:
Option I: Only grid power plants are included in the calculation.
Option II: Both grid power plants and off-grid power plants are included in the calculation.
In this PDD, Option I is chosen to calculate OM and BM emission factor.
STEP 3. Select a method to determine the operating margin (OM)

According to the tool the calculation of the operating margin emission factor is based on one of the
following methods:
(a) Simple OM, or
(b) Simple adjusted OM, or
(c) Dispatch data analysis OM, or
(d) Average OM.
Any of the four methods can be used, however, the simple OM method (option a) can only be used if low
cost/must-run resources constitute less than 50% of total grid generation in: 1) average of the five most
recent years, or 2) based on long-term averages for hydroelectricity production.
The Share of Low Cost / Must-Run (% of Net Generation) in the generation profile of the different grids
in India in the last five years is as follows:
NEWNE
South
India
Share of Must-Run (Hydro/Nuclear) (% of Net Generation)

2005-06
2006-07
2007-08
18.0%
18.5%
19.0%
27.0%
28.3%
27.1%
20.1%
20.9%
21.0%
24
2008-09
17.3%
22.8%
18.6%
2009-10
15.9%
20.6%
17.1%
CDM Executive Board
Source: CO2 Baseline Database for the Indian Power Sector, Central Electricity Authority (Version 6.0)
The above data clearly shows that the percentage of total grid generation by low cost/must run plants (on
the basis of average of five most recent years) for the NEWNE regional grid is less than 50 % of the total
generation.
As per tool to calculate emission factor for an electricity system (Version 02.2.1), The simple OM method
(option a) can only be used if low-cost/must-run resources constitute less than 50% of total grid
generation in: 1) average of the five most recent years, or 2) based on long-term averages for
hydroelectricity production. Since the low cost/must run resources constitute less than 50% of total grid
generation as seen from the average of five most recent years, the Simple OM method can be used to
calculate the Operating Margin Emission factor.
The project proponents choose an ex ante option for calculation of the Simple OM with a 3-year
generation-weighted average, based on the most recent data available at the time of submission of the
CDM-PDD to the DOE for validation, without requirement to monitor and recalculate the emissions
factor during the crediting period.
STEP 4. Calculate the operating margin emission factor according to the selected method
The simple OM emission factor is calculated as the generation-weighted average CO2 emissions per unit
net electricity generation (tCO2/MWh) of all generating power plants serving the system, not including
low-cost / must-run power plants / units.
The simple OM may be calculated:
Option A: Based on the net electricity generation and a CO2 emission factor of each power unit; or
Option B: Based on the total net electricity generation of all power plants serving the system and the fuel
types and total fuel consumption of the project electricity system.
The Central Electricity Authority, Ministry of Power, Government of India has published a database of
Carbon Dioxide Emission from the power sector in India based on detailed authenticated information
obtained from all operating power stations in the country. This database i.e. The CO2 Baseline Database
provides information about the Combined Margin Emission Factors of all the regional electricity grids in
India. The Combined Margin in the CEA database is calculated ex ante using the guidelines provided by
11
the UNFCCC in the Tool to calculate the emission factor for an electricity system, Version 01.1 . We
have, therefore, used the Combined Margin data published in the CEA database, for calculating the
Baseline Emission Factor.
11
The CEA database uses version 1.1 of tool to calculate the emission factor for an electricity system. The latest
tool available is version 2.2.1. The revisions carried out from version 2.0 to 2.2.1 do not impact the calculated value
of emission factor and hence have no bearing on the emission reduction estimate. The same can be verified from
CEA
database
version
7.0
(http://www.cea.nic.in/reports/planning/cdm_co2/user_guide_ver7.pdf,
http://www.cea.nic.in/reports/planning/cdm_co2/database_7.zip) which uses the latest version of the tool (Version
2.2.1). The calculated values of the operating margin for years 2007-08, 2008-09 and 2009-10 and build margin for
2009-10 in CEA database version 7.0 are the same as that in CEA database version 6.0 which uses Version 1.1 of
the tool.
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CDM Executive Board
As per Tool to calculate the emission factor for an electricity system, Option A (Based on the net
electricity generation and a CO2 emission factor of each power unit) is used to calculate simple OM
emission factor. Where Option A is used, the simple OM emission factor is calculated based on the
electricity generation of each power unit and an emission factor for each power unit, as follows:
EFgrid,OMsimple,y = (EGm,y x EFEL,m,y) / EGm,y
Where:
EFgrid,OMsimple,y
EGm,y
EFEL,m,y
m
y
Simple operating margin CO2 emission factor in year y (tCO2/MWh)

Net quantity of electricity generated and delivered to the grid by power unit m in year y
(MWh)
CO2 emission factor of power unit m in year y (tCO2/MWh)
All power units serving the grid in year y except low-cost / must-run power units
the relevant year as per the data vintage chosen in STEP 3
The CO2 emission factor (EFEL,m,y) data for simple OM, available under the CEA database12 (Version 6.0)
for the last three years is as follows.
CO2 emission factor for simple OM (tCO2/MWh) (incl. Imports)
2007-08
2008-09
2009-10
Grid
NEWNE
0.99990
1.00655
South
0.99086
0.97292
India
0.99797
1.00940
0.97774
0.94150
0.97823
The net electricity generation (EGm,y) data, available under the CEA database13 (Version 6.0), of all
generating power plants (not including low-cost / must-run power plants / units) for the last three year is
as follows:
Net Electricity Generation for Simple OM (MWh) (incl. Imports)
2007-08
2008-09
2009-10
Grid
NEWNE
401,642
421,803
South
114,634
121,471
India
516,275
543,274
458,043
134,717
592,760
Thus, as can be seen from the above tables, the 3 years generation-weighted OM average for the most
recent three years available at the time of PDD for validation, i.e. 2007-08, 2008-09, 2009-10 for
NEWNE grid is:
=
(401,642,000*0.9999 + 421,803,000*1.00655 + 458,043,000*0.97774)

---------------------------------------------------------------------------------------(401,642,000+ 421,803,000+ 458,043,000)
12
13
26
tCO2/MWh
CDM Executive Board
0.99417 tCO2/MWh
The ex-ante OM value obtained is 0.99417 tCO2/MWh

STEP 5. Calculate the build margin emission factor
The project proponents have chosen Option I, i.e. fixing build margin emission factor ex ante based on
the most recent information available on units already built for sample group m at the time of CDM-PDD
submission to the DOE for validation.
The build margin emissions factor is the generation-weighted average emission factor of all power units
m during the most recent year y for which power generation data is available, calculated as follows:
EFgrid,BM,y = ( EGm,y x EFEL,m, ) / EGm,y
Where:
EFgrid,BM,y Build margin CO2 emission factor in year y (tCO2/MWh)
EGm,y Net quantity of electricity generated and delivered to the grid by power unit m in year y (MWh)
EFEL,m,y CO2 emission factor of power unit m in year y (tCO2/MWh)
m Power units included in the build margin
y Most recent historical year for which power generation data is available
The CO2 emission factor of each power unit m (EFEL,m,y) is determined as per the procedures given in step
4 (a) for the simple OM, using options A1B1 using for y the most recent historical year for which power
generation data is available, and using for m the power units included in the build margin.
The build margin emission factor (EFgrid,BM,y) for the year 2009-10 (most recent year) for NEWNE grid
is 0.81230 tCO2/MWh
STEP 6. Calculate the combined margin emissions factor
The emission factor EFy of the grid is represented as a combination of the Operating Margin (OM) and
the Build Margin (BM). Considering the emission factors for these two margins as EFgrid OM,y and EFgrid
BM,y, then the EFy is given by:
EFgrid,CM,y = EFgrid,OM,y * wOM + EFgrid,BM,y * wBM
Where:
EFgrid, BM, y Build margin CO2 emission factor in year y (tCO2/MWh)
EFgrid, OM, y Operating margin CO2 emission factor in year y (tCO2/MWh)
wOM Weighting of operating margin emissions factor
wBM Weighting of build margin emissions factor (where wOM + wBM = 1).
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CDM Executive Board
The Tool to calculate the emission factor for an electricity system requires that for intermittent sources
for power generation like solar as in the case of proposed CDM project activity the following weights to
be used for calculating the emission factor for Combined Margin.
WOM = 0.75
WBM = 0.25
Using the values of emission factors for OM and BM for NEWNE grid, provided in the CEA official
database and as computed above; and the weights provided above, the value of the emission factor for the
combined margin has been determined to be:
=
0.99417 * 0.75 + 0.81230 * 0.25 tCO2/MWh
0.94870 tCO2/MWh
Project Emissions:
The project activity uses wind energy to generate electricity and hence the emissions from the project
activity are taken as NIL (as per AMS-I.D Version 17 para 20).
PEy = 0
Leakage:
Since no equipment is transferred from another project activity or that any existing equipment is
transferred to another activity, leakage as per AMS-I.D Version 17 para 22 is taken as zero.
LEy = 0
Details of Baseline data:
Data of Operating and Build Margin for the three financial years from 2007-08 to 2009-10 has been
obtained from The CO2 Baseline Database for the Indian Power Sector
Ministry of Power: Central Electricity Authority (CEA)
Version 6
Dated: March 2011
Key baseline information is reproduced in annexure 3.
The detailed excel sheet is available at:
B.6.2. Data and parameters that are available at validation:
Data / Parameter:
Data unit:
Description:
Source of data used:
EFgrid OM,y
tCO2/MWh
Operating Margin Emission Factor for NEWNE Grid
CO2 Baseline Database for Indian Power Sector published by the Central
Electricity Authority, Ministry of Power, Government of India. Version 6.0
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CDM Executive Board
dated March 2011

The CO2 Baseline Database for Indian Power Sector is available at
Value applied:
0.99417
Justification of the
choice of data or
description
of
measurement methods
and procedures actually
applied :
The CO2 Baseline Database for the Indian Power Sector, User Guide, Version
6.0 dated March 2011, released by the Central Electricity Authority, Ministry of
Power, Government of India, is the official database for statistics on the power
sector in India in the various grids. It has been specially created to meet the data
requirements for emission factors for the CDM project activities in the country.
The database is used in accordance with the requirements in the applicable
methodology stated as, Calculations must be based on data from an official
source and made publicly available
Any comment:
Data / Parameter:
Data unit:
Description:
Operating Margin Emission Factor has been calculated by the Central

Electricity Authority using the simple OM approach in accordance with Tool
to calculate emission factor for an electricity system, Version 02.2.1.
Operating margin emission factor is fixed ex-ante throughout the crediting
period.
EFgrid BM,y
tCO2/MWh
Build Margin Emission Factor for NEWNE Grid
CO2 Baseline Database for Indian Power Sector published by the Central
Electricity Authority, Ministry of Power, Government of India. Version 6.0
dated March 2011
The CO2 Baseline Database for Indian Power Sector is available at
Value applied:
choice of data or
description
of
measurement methods
and procedures actually
applied :
0.81230
The CO2 Baseline Database for the Indian Power Sector, User Guide, Version
6.0 dated March 2011, released by the Central Electricity Authority, Ministry of
Power, Government of India, is the official database for statistics on the power
sector in India in the various grids. It has been specially created to meet the data
requirements for emission factors for the CDM project activities in the country.
The database is used in accordance with the requirements in the applicable
methodology stated as, Calculations must be based on data from an official
source and made publicly available
Build Margin Emission Factor has been calculated by the Central Electricity
29
CDM Executive Board
Authority in accordance with Tool to calculate emission factor for an

electricity system, Version 02.2.1.
Build margin emission factor is fixed ex-ante throughout the crediting period.
Any comment:
Data / Parameter:
Data unit:
Description:
EFgrid CM,y or EFCO2,grid,y

tCO2/MWh
Combined Margin Emission Factor for NEWNE Grid
Computed using the following formula
EFCO2,grid,y = WOM * EF grid,OM,y + WBM *EF grid, BM,y
http://cdm.unfccc.int/methodologies/SSCmethodologies/AppB_SSC_Attachment
A.pdf
EFCO2,grid,y = 0.75 * 0.99417 + 0.25 * 0.81230 = 0.9487
Combined margin CO2 emission factor for grid connected power generation in
year y calculated using the latest version of the Tool to calculate the emission
factor for an electricity system, Version 02.2.1
The CO2 Baseline Database for Indian Power Sector, Version 6.0 dated
March 2011 is available at:
Value applied:
choice of data or
description
of
measurement methods
and
procedures
actually applied :
Any comment:
B.6.3
0.94870
This is in accordance with the latest version of the applicable methodology,
AMS-I.D Version 17 Grid Connected Renewable Electricity Generation, and
the Tool to calculate the Emission Factor for an Electricity System, Version
02.2.1
Combined margin emission factor is fixed ex-ante throughout the crediting
period.
Ex-ante calculation of emission reductions:
According to the approved methodology AMS-I.D Version 17 para 23, Emission reductions are
calculated as follows:
ERy = BEy PEy LEy.. (1)
Where: BEy
PEy
LEy
is the baseline emissions

is project activity emissions and;
is the amount of emissions leakage resulting from the project activity.
Ex-ante calculation of emission reductions is equal to ex-ante calculation of baseline emissions as project
emissions and leakages are taken as NIL as per AMS-I.D Version 17 para 20 and 22 respectively.
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CDM Executive Board
ERy = BEy = EGBL,y * EFCO2,grid,y

EGBL,y = Capacity x PLF (Third party estimate) x Generating Hour (in a year) .. (3)
= 6 MW x 23.80% x 8760
= 12509.28 MWh
EFCO2,grid,y (Baseline emission factor (combined margin) as calculated in Section B.6.1.)
= 0.94870 tCO2/MWh
ERy = EGBL,y * EFCO2,grid,y.. (2)
= 12509.28 MWh x 0.94870 tCO2e/MWh
= 11,867 tCO2e
B.6.4
Summary of the ex-ante estimation of emission reductions:
Estimation of
Estimation of
Estimation of overall
project activity
Estimation of
Years
baseline Emissions
emission reductions
emissions (t
Leakage (tCO2e)
(t CO2e)
(tCO2e)
CO2e)
Year 1 (2012-2013)
0
11,867
0
11,867
Year 2 (2013-2014)
0
11,867
0
11,867
Year 3 (2014-2014)
0
11,867
0
11,867
Year 4 (2015-2016)
0
11,867
0
11,867
Year 5 (2016-2017)
0
11,867
0
11,867
Year 6 (2017-2018)
0
11,867
0
11,867
Year 7 (2018-2019)
0
11,867
0
11,867
Year 8 (2019-2020)
0
11,867
0
11,867
Year 9 (2020-2021)
0
11,867
0
11,867
Year 10 (2021-2022)
0
11,867
0
11,867
Total (tonnes of
0
118,670
0
118,670
CO2 e)
B.7
Application of a monitoring methodology and description of the monitoring plan:

B.7.1
Data and parameters monitored:
Parameter:
Unit:
Description:
Source of data:
Value of data:
Brief description of
measurement methods
EGBL,y,
MWh (Mega-watt hour)
Quantity of net electricity supplied to the grid in year y
Net Electricity exported to the grid as per the Certificate for share of
electricity generated by wind farm issued by state utility, hereafter referred as
(Share certificate)
12509.28
1. A meter is installed in the transformer yard of each WTG. The switchyard
meter is a Tri-vector meter (TVM) of 0.5s accuracy class. The switchyard
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CDM Executive Board
and procedures to be
applied:
QA/QC procedures to
be applied:
Any comment:
B.7.2
meter reading is recorded by Suzlon and given to the state utility on a monthly
basis for apportioning the energy.
2. The project activity WTGs (including other non-project WTGs) are
connected to Shikarpur substation
3. An ABT (Availability Based Tariff) meter is installed at the substation
4. The ABT meter is of 0.2s accuracy class
5. Recording frequency- Reading from ABT meter is taken atleast on a monthly
basis by the state utility and representative of Project Proponent and after
apportioning the final reading is presented in the monthly issued share
certificate. ABT meter measures net electricity in 15 minute time-blocks (real
time) and hence meets the requirement of Continuous monitoring, hourly
measurement and at least monthly recording prescribed in the methodology.5.
In case the ABT is found to be malfunctioning, the ABT meter at the GETCO
substation (Shivlakha) is used to record the energy reading. The ABT meter at
GETCO substation is of 0.2s accuracy class.
6. The state utility apportions the electricity and issues the certificate for share
of electricity generated by the project. The details are presented in section B.7.2
1. The ABT meter is tested for accuracy once in 3 years by the state utility.
2. These test reports would be available with the PP
3. The switchyard meters are tested annually by Suzlon through an external
agency
4. The monitored values can be cross checked using the invoices raised by PP.
Payment received by PP through cheque or online transfer could be used to
cross verify the electricity generated depicted in the share certificate
Archiving policy: Data, share certificate, will be archived for a period of
crediting period + 2 years in paper and electronic form.
Description of the monitoring plan:
The applicable simplified baseline and monitoring methodology for selected small scale CDM project
activities AMS-I.D Version 17 requires monitoring of net electricity supplied to the grid.
Further, wind based electricity generation is not associated with any kind of project emissions and
leakages. Hence, the sole parameter for monitoring is the electricity supplied to the grid. The Project is
operated and managed by Suzlon Windfarm Services Limited (SISL) which is an ISO certified
organization. They follow the documentation practices to ensure the reliability and availability of the data
for operation of the wind power project. The monitored data can be found from the certificate of share of
electricity issued by state utility to the project participants.
QA/QC:
The meter located at the grid sub-station is sealed and maintained by the state electricity utility. The meter
is tested for accuracy once in 3 years. In case during testing, meter is found to be functioning beyond the
permissible limits, they are immediately calibrated. Calibration of meters will be carried out by state
utility. The accuracy class of meter at sub-station is 0.2s. The accuracy class of meter at switchyard of
WTG is 0.5s. The switchyard meters are calibrated annually for accuracy by SISL through an external
agency.
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CDM Executive Board
Monitoring will be done as:

Meter reading: The ABT meter readings at the Shikarpur substation are taken jointly by the
representatives of state utility and the representative of power producer (Suzlon) on atleast on a monthly
basis and after apportioning the final reading is presented in the monthly issued share certificate. Such
meter readings shall be treated as the accurate and final measurement of the energy supplied to GUVNL
by the power producer for preceding month. Reading from the ABT meter at Shivlakha Substation is
taken by the representatives of state utility and the PP in case the ABT meter at Shikarpur Substation is
faulty. The ABT meter reading recorded at the Shikarpur substation indicates total net energy exported by
all the WTGs in the wind farm including non-project activity WTGs. PPs representative (SISL) also
provides the monthly reading of the meter in switchyard of WTG to the state utility. Based on the
monthly ABT meter reading at the substation and the monthly reading of meter at switchyard of WTG
provided by SISL, the state electricity utility prepares and submits the Certificate for share of electricity
generated by wind farm to the individual investor. Based on this share certificate, authorized by the state
electricity utility, the PP raises an invoice. Payments are made by the state utility to the PP through either
the cheque or online transfer. Continuous monitoring, hourly measurements by the meters, and monthly
recordings will be carried out.
Net Electricity Exported to the Grid by the project activity as per apportioning procedure followed
by state utility:
EGBL,y = EGSS,Net Export X (EGSwitchyard,Project WTGs,Net Export/ EGSwitchyard, Project & Non project WTGs ,Net Export)
Where,
EGSS,Net Export :
Net electricity exported by all WTGs connected to the substation

(project activity WTGs and non-project activity WTGs), as
recorded by the ABT meter at substation (Shikarpur) (MWh)
EGSwitchyard,Project WTGs,Net Export :
Net electricity exported by the project activity, as measured at

Switchyard meter (MWh)
EGSwitchyard, Project & Non project WTGs ,Net Export : Net electricity exported by all the project owners connected to
the substation (MWh) measured at switchyard meters
The net electricity supplied to the grid will be cross-checked with records of sold electricity. Payment
received through cheque or online transfer could be used to cross verify the electricity generated depicted
in the share certificate.
Procedures for handling data uncertainty for GETCO substation meters/switchyard meters:
a- In case ABT meter at Shikarpur Substation is faulty- ABT meter at the GETCO (Shivlakha)
substation is used to calculate the electricity exported to the grid. ABT meter at Shikarpur
Substation is immediately replaced by a new meter and meter reading from the replaced meter is
used thereafter.
b- In case the ABT meter at the GETCO (Shivlakha) substation is faulty- ABT meter at the GETCO
(Shivlakha) substation is immediately replaced. The emission reduction calculation would not be
affected as reading from ABT meter at Shikarpur Substation is used to calculate the net electricity
exported to the grid.
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CDM Executive Board
c- In case error is identified duringaccuracy testing- If during the tests, the meter is found to be
beyond the permissible limits of error, the meter shall be immediately calibrated and replaced, if
necessary. The error that is identified in the accuracy testing would be applied to all the readings
of electricity exported as indicated in the share certificate from the date of last accuracy testing.
Billing for the period thereafter shall be as per the calibrated meter.
d- The switchyard meters are tested annually by SISL through an external agency. The meters are
replaced immediately in case of a fault.
Roles and responsibilities
The operational and management structure implemented by the project proponents and Suzlon is as
follows:
Project Proponent (GPCL)
CDM Coordinator
Review, Corrective Action
SISL
Customer Relations Manager
Review, Check, Internal Audit,

authorize and forward monitoring
data
SISL O&M Team

Site Manager
Machine Operators
Monitor, Record, Report and

Archive Data
Service Engineers
B.8
Date of completion of the application of the baseline and monitoring methodology and the
name of the responsible person(s)/entity(ies)
Date of completion: 19/09/2011
Name of responsible person/entity: Gujarat Power Corporation Ltd and their consultant.
Contact information:
Mr. Rajendra Mistry
Senior Executive (Projects)
Mobile: +91 9978407405
Direct FAX: 079 - 23251254
Direct tel: 079 - 23251260
Personal E-Mail: rajendramistry@gpclindia.com
The contact details are also furnished in Annex 1.
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CDM Executive Board
The consultant has only assisted GPCL in application of the baseline and monitoring methodology. The
consultant is not a project proponent and GPCL is the only project proponent for this project activity
SECTION C. Duration of the project activity / crediting period
C.1
Duration of the project activity:

C.1.1. Starting date of the project activity:
20/08/2010, being the date of placement of purchase order for WTGs.

C.1.2. Expected operational lifetime of the project activity:
20 Years and 00 months
C.2
Choice of the crediting period and related information:
Fixed- 10 years
C.2.1. Renewable crediting period
C.2.1.1.
Starting date of the first crediting period:
C.2.1.2.
Length of the first crediting period:
NA
NA
C.2.2. Fixed crediting period:
Fixed crediting period -10 years and 0 months.
C.2.2.1.
Starting date:
01/07/2012 or the date of submission of the project activity to UNFCCC by the DOE (whichever is later)
C.2.2.2.
Length:
10 Years and 0 months
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CDM Executive Board
SECTION D. Environmental impacts
D.1.
If required by the host Party, documentation on the analysis of the environmental impacts
of the project activity:
As per the Schedule 1 of the EIA notification 2006, given by the Ministry of Environment and Forests
under the Environment (Protection) Act 1986, the proposed project doesnt fall under the list of activities
requiring EIA14. The project will not involve any negative environmental impacts, as the WTGs are
installed for generation of power using wind which is a clean source of energy, thus no EIA study was
conducted.
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:
The environmental impacts from the proposed CDM project activity are not considered significant.
SECTION E. Stakeholders comments
E.1.
Brief description how comments by local stakeholders have been invited and compiled:
A local stakeholder meeting was conducted at Shikarpur village (Suzlon CMS), Gujarat on 25th May 2011
to invite comments from local stakeholders and to understand any issues they may have with respect to
the project activity. An advertisement was placed in the local newspapers Kutch MItra, Bhuj and Divya
Bhaskar, Bhuj on 7th May 2011 informing the local stakeholders for the meeting. Personal invites were
also given to local villagers. The local stakeholders were notified 15 days prior (notice period) to the
actual date of the meeting. The stakeholders included members of the local village Panchayats, residents
of the area, Suzlon representatives as well as Project Participants (GPCL) representatives.
The meeting was presided over by Mr. Rajendra Mistry (GPCL, Mr.Sunil Patel (GPCL) and Mr. Ujjwal
Surana (Suzlon).
E.2.
Summary of the comments received:
The meeting started with Mr. Rajendra Mistry, Sr. Executive (GPCL) welcoming all the stakeholders and
explaining the agenda for the meeting. The stakeholders included members of the local village
Panchayats, residents of the area, Suzlon representatives as well as Project Participants (GPCL)
representatives.
Mr. Rajendra Ministry stated that the Project developer is installing Wind Turbine Generators that will
generate Green power. The stakeholders were presented, in vernacular (Gujarati), with an overview of the
project activity as well as the technological, economic, environmental and social issues associated with it.
14
http://envfor.nic.in/divisions/iass/notif/eia.htm
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CDM Executive Board
Mr Sunil Patel GET-Electrical (GPCL) spoke about CDM to all the stakeholders, explained how carbon
dioxide level in the atmosphere is increasing and how renewable energy initiatives help in reducing
greenhouse gas levels. The stakeholders were then invited to give their comments, suggestions and
concerns regarding the project activity. Local villagers asked questions related to local electricity supply,
employment opportunities and local development etc.
Details of comments made by stakeholders and their respective responses by project proponent are given
below:
S.No.
1
Query
Will the project help in
improving electricity
supply to the villagers
or the neighbouring
areas?
Will the Project provide

employment
opportunities or help in
economic development
of the area?
E.3.
Will there be any

problem for animal
grazing or for birds due
to activity being carried
out at the project site?
Will there be any harm

to
the
local
infrastructure because of
the project activity?
Query Raised
By
Response
Ravi, Local
The power generated
villager
from the wind farm
will be fed to the state
electricity grid. It is
expected that the
supply position in the
village will be
strengthened.
Bhavesh
The social and
Parmar, Local
economic
villager
development of the
nearby villages will
take place as a result
of employment
opportunities created
by the project activity
during the
construction phase and
the operation phase
The project activity
will
pose
no
obstruction to the
animal grazing in and
Alpesh
around
the
local
vallabhai, Local premised
of
the
villager
project activity
There will be no harm
to
any
local
infrastructure because
of the project activity.
As a matter of fact,
Alpesh
local
infrastructure,
vallabhai, Local such as roads will be
villager
improved.
Report on how due account was taken of any comments received:
37
Response given by
Mr Rajendra Mistry,
GPCL
Mr Rajendra Mistry,
GPCL
Mr Sunil
GPCL
Patel,
Mr Ujjwal Surana,
Suzlon
CDM Executive Board
Overall a positive response was received from the stakeholders. There were no negative comments and
the attendees identified employment generation, local area development and creating awareness as some
of the benefits from the project activity.
Annex 1
CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY
Organization:
Street/P.O.Box:
Building:
City:
State/Region:
Postfix/ZIP:
Country:
Telephone:
FAX:
E-Mail:
URL:
Represented by:
Title:
Salutation:
Last Name:
Middle Name:
First Name:
Department:
Mobile:
Direct FAX:
Direct tel:
Personal E-Mail:
Gujarat Power Corporation Ltd.

6th Floor, 6 & 8 Block, Udhyog Bhawan, Sector - 11
Gandhinagar
Gujarat
382011
India
079 23251255
079 23251254
rajendramistry@gpclindia.com
Senior Executive (Projects)

Mr.
Mistry
Rajendra
+91 9978407405
079 - 23251254
079 - 23251260
rajendramistry@gpclindia.com
38
CDM Executive Board
Annex 2
INFORMATION REGARDING PUBLIC FUNDING
There is no Official Development Assistance or public funding involved in the project.
39
CDM Executive Board
Annex 3
BASELINE INFORMATION
Baseline Emission Factor:
The Operating Margin data for the most recent three years and the Build Margin data for the NEWNE
Electricity Grid as published in the CEA database are as follows:
Grid Emission Factors15:
The Operating Margin data for the most recent three years and the Build Margin data for the NEWNE
Electricity Grid as published in the CEA database version 6 are as follows:
Simple Operating Margin

The CO2 emission factor (EFEL,m,y) data for simple OM, available under the CEA database16 (Version 6.0)
for the last three years is as follows.
CO2 emission factor for simple OM (tCO2/MWh) (incl. Imports)
2007-08
2008-09
Grid
NEWNE
0.99990
1.00655
South
0.99086
0.97292
India
0.99797
1.00940
2009-10
0.97774
0.94150
0.97823
The net electricity generation (EGm,y) data, available under the CEA database17 (Version 6.0), of all
generating power plants (not including low-cost / must-run power plants / units) for the last three year is
as follows:
Net Electricity Generation for Simple OM (MWh) (incl. Imports)
2007-08
2008-09
2009-10
Grid
NEWNE
401,642
421,803
South
114,634
121,471
India
516,275
543,274
458,043
134,717
592,760
Thus, as can be seen from the above tables, the 3 years generation-weighted OM average for the most
recent three years available at the time of PDD for validation, i.e. 2007-08, 2008-09, 2009-10 for
NEWNE grid is:
15
Baseline Carbon Dioxide Emissions from Power Sector, Baseline Carbon Dioxide Emission Database Version 6.0 dated March
2011 on http://www.cea.nic.in/reports/planning/cdm_co2/cdm_co2.htm
16
17
40
CDM Executive Board
(401,642,000*0.9999 + 421,803,000*1.00655 + 458,043,000*0.97774)

---------------------------------------------------------------------------------------(401,642,000+ 421,803,000+ 458,043,000)
0.99417 tCO2/MWh
tCO2/MWh
Build Margin
NEWNE Grid (tCO2 e/MWh)
0.81230
Build Margin for the year 2009-10
Weighted Combined Margin Calculations

Weights
Operating Margin
Build Margin
Combined Margin
0.75
0.25
= (0.75*0.99417) + (0.25*0.81230)
= (0.745627) + (0.203075)
= 0.94870
41
NEWNE Grid
(tCO2 e/MWh)
0.99417
0.81230
0.9487
CDM Executive Board
Annex 4
MONITORING INFORMATION
Please refer to section B.7.2
42
CDM Executive Board
Annex 5
Selection of Appropriate Benchmark:
The guidance to investment analysis (version 05.0) issued in EB 62- Annex 05 (para 12) states that in
cases where a benchmark approach is used the applied benchmark shall be appropriate to the type of IRR
calculated. Required/expected returns on equity are appropriate benchmarks for post-tax equity IRR.
It is also worthwhile to note that the captioned project is a Greenfield wind power generation project that
generates and supplies electricity to the state grid, therefore the project can have many potential project
developers. The guidance in Para 13 states that in such cases (where the projects could be developed by
an entity other than the project participant) the benchmark should be based on publicly available data
sources which can be clearly validated by the DOE. Hence the benchmark has been calculated based on
parameters that are standard in the market, considering the specific characteristics of the project type.
Accordingly, the required return on equity applicable to the project type has been calculated as follows.
The expected return on equity has been determined using the Capital Asset Pricing Model (CAPM)18. The
CAPM economic model is used worldwide to determine the required/expected return on equity based on
potential risk of an investment. The CAPM framework is the Nobel award winning work of financial
economist Dr. William Sharpe.
Ke = Rf + B x (Rm - Rf)
where:
Ke = Rate of return on equity capital;
Rf = Risk-free rate of return;
B = Beta;
Rm Rf = Market risk premium;
In calculating the benchmark rate of return on equity we have based our approach on the principles of
financing and investment decision making that are well found in theory and practice of corporate
financing world wide. We have derived from text book on Corporate Finance Theory and Practice by
Dr. Aswath Damodaran of Stern School of Business, New York University. Dr. Damodaran is one of the
foremost authorities in the world in the field of Investment Analysis.
Risk free rate:
The risk free rate is understood as the rate of return on an asset that is theoretically free of any risks,
therefore the rate of interest on government bonds are considered as risk free rates.
Accordingly the risk free rate has been taken from long dated Indian government bond rates available at
the time of decision to invest in the project (20th August 2010). The risk free rate of the year 2009-10 has
been considered as it was in the year of investment (i.e in that year, the company had the alternative of
this long term risk free investment). The data on government bond rates is published by Reserve Bank of
18
The Capital Asset Pricing Model (CAPM) was published in 1964 by William Sharpe, for his work on CAPM
Sharpe received the Nobel Prize in 1990. http://www.investopedia.com/articles/06/CAPM.asp
43
CDM Executive Board
India. (Web-link: http://www.rbi.org.in/scripts/BS_ViewBulletin.aspx?Id=11482 dated 11th August

2010)
The applicable risk free rate is 8.26%.
Risk Premium:
The most common approach for estimating the risk premium is to base it on historical data, in the CAPM,
the premium is estimated by looking at the difference between average return on stocks and average
return on government securities over an extended period of history. The market return for the BSE
Sensex, BSE 100, BSE 200 and BSE 500 indices were reviewed. The market return computed on the BSE
200 index (15.81%) is the lowest amongst the four BSE indices considered and conservatively, the same
has been used for calculating the market risk premium. The risk premium has been calculated as the
difference in compounded annual return between the Government bond rates and the BSE-200 index as
long term data since inception of BSE-200 index, i.e. 1989 90 is available. The detailed calculations are
presented in the attached excel sheet.
The applicable risk premium is 7.557%.
Beta:
Beta (B) indicates the sensitivity of the company to market risk factors. Beta represents the market risk
for an asset and is calculated as the statistical measure of volatility of a specific asset/investment relative
to the movement of a market group. The conventional approach for estimating beta of an investment is a
regression of returns on investment against returns on a market index. The beta can then be determined by
referring beta values of publicly listed similar companies that are engaged in similar types of business.
The project activity type is wind power generation, therefore the data available on companies which are
involved in similar businesses has been considered.
We have considered beta values of listed electricity generating companies in India. The group of
companies considered include power generating companies that are involved in conventional power
generation as well as renewable energy.
Conservativeness of Beta
The beta values of the companies chosen would reflect the risk in both conventional energy as well as the
wind energy business. It is understood that risky businesses are likely to have higher return on equity than
safer businesses; projects in riskier businesses will have to cover these higher costs. Hence, investors
demand a higher return from renewable energy projects than from conventional energy ones, given the
higher risks in renewable, including risks of technology, risks from significantly varying and
unpredictable resource availability (e.g. wind), and a lower established support base for such projects
relative to that for conventional power (e.g. grid connections, bank finance, suppliers, etc.). The use of
this Beta value is therefore considered conservative, as it does not add for the higher risk of non
conventional energy.
The applicable Beta value has been determined on the basis of the beta values of power generating
companies in India which were listed on the stock exchange at the time of investment decision.
Five years monthly beta values (for the period of five years prior to investment decision date) of
individual companies have been sourced from Bloomberg. From the sub-set of the companies, the
average beta (unlevered) has been taken for the estimate of the risk relating to similar project activities.
The table below summarizes the beta values:
44
CDM Executive Board
Company Name
Beta
Value
Tata Power Co Ltd
0.720
BF Utilities Ltd
1.138
CESC in equity
0.704
Neyveli Lignite Corporation
1.135
Reliance Infrastructure Ltd
1.434
Gujarat Inds Power Co Ltd
0.998
Jaiprakash Ventures Ltd

Average
1.398
1.08
Calculation of benchmark i.e. Return on equity:

Required return on equity = [Rf + B x (Rm - Rf)]
(8.26% + 1.08 * 7.557%) = 16.38%
Therefore the benchmark for post-tax equity IRR of the project is the return on equity of companies
engaged in similar business as that of the project which is calculated as 16.38 %.
45

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PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03

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CLEAN DEVELOPMENT MECHANISM

General description of the small scale project activity

Application of a baseline and monitoring methodology

Duration of the project activity / crediting period

PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03

CDM Executive Board

Revision history of this document

Description and reason of revision

PROJECT DESIGN DOCUMENT FORM (CDM-SSC-PDD) - Version 03

CDM Executive Board

SECTION A. General description of small-scale project activity

Title of the small-scale project activity: