Report, Case study 2 Study baseline methodology in Vietnam comments and proposal

1. UNEP rise centre - DemarkFourth regional workshop and training on“Capacity development for the clean development mechanism”4-6 April - AIT Thailand Report, Case study 2 Study baseline methodology in Vietnam comments and proposal By Dr. Bui Huy Phung Dr. Nguyen Tien Nguyen VN CD for CDM

2. Key contents Part I. Study to build the typical baseline for Vietnam electrical grid 1.1. Methodology 1.2. Data needed 1.3. Result of typical baseline calculation for Vietnam electricity grid Part II. Comments and proposal. 2.1. Comments 2.2. Proposals used.

3. Part I. Study to build the typical baseline for Vietnam electrical grid 1.1. Methodology There are 2 specific guides issued by EB to calculate baseline emission factor for the grid. • Appendix B of the simplified modalities and procedures for small-scale CDM project activities • Consolidated baseline methodology for grid connected electricity generation from renewable sources Following quanlities must be calculated: • The operating margin emission factor (EF-OM) • The build margin emission factor (EFBM) • The baseline emission factor EF.

4. 1.1. Methodology (cont.) • Based on guiders of appendix B, following calculation formular are used • EF-OM (t CO2eq/kWh)= Ej/ Gj Ej is CO2 emission per year in tons for fuel j- tCO2/year Gj: electricity generation from fuel j • EF-BM (tCO2eq/kWh)= EFy.GENi /  GENi EFi- the emission rate for unit i (tCO2/kWh) GENi - the generation (kWh) from unit i. • Calculate 1/2(EFOM + EFBM) • Calculate GA-weighted average emission of all power plants (grid average) GA= Ej / GENj

5. 1.1. Methodology (cont.) b) Based on consolidated baseline methodology • Calculate the operating margin emission factor (EFOMy) • Simple OM, EFOM simp. y - the generation weighted average emission per electricity unit of all generating sources serving in the system EFOM,y=Fi,j y*COEFij / GENj,y Fi,j,y- the mass of fuel i consumed by sources j in year y • Simple adjusted OM In this case, power sources include imports and are separated in low cost /must-run power plants.

6. b) Based on consolidated baseline methodology (cont.) • Dispatch data analysis OM EFOM,Disp j = EOMy/EGy In which EGy - generation of project in year y (kWh, MWh) EOMy = EGh*EFDDh EGh - the generation in each hour h, and EFDDh - the hourly generation weighted average emission per electricity unit of the set of power plants (n) in the top 10% of grid dispatch order during hour h. • Average OM aver EFOM-aver is calculated as the average emission rate of all power plants, using equation described for the simple OM above, but including low-operating cost and must-run power plants.

7. 1.1. Methodology (cont.) c) The build margin emission factor Calculate EFBM,y as the generation weighted average emission factor of power plants (m) d) Calculate the baseline emission factor EFy EFy = WOMEFOMy + WBMEFBMy When using this methodology there are a lot of difficulties • It is short of day-night typical load diagram of grid in dry season and rainy season, (or typical day of year) specially for future • Dispatch data is not available so it can not to analyze OM • It is complicated to identify low cost/must run power sources, specially for future • Etc. So it is not able to calculate EFOM as requested conditions.

8. 1.2. Needed key data • COEFj - CO2 emission per unite for each fuel j • LHVj - low heat value of fuel j • GENj - electricity generation from fuel j (kWh. MWh,…) • 5 most recent plants and their performances • Or the most recent 20% of existing plants and their performances • Forecasted data of power plants and grid in study periods • etc

9. 1.3. Result of typical baseline calculation for Vietnam electricity grida) Based on appendix BTable 1: Baseline emission factors of the Vietnam national grid, gCO2/kWh

10. Figure 1. emission factors of the Vietnam national grid during period of 2001-2010

11. b) In case of consolidated baseline methodologyAccording to Simple OMTable 2: Baseline emission factor calculated in OMsimple, gCO2/kWh

12. Figure 2: Baseline emission factor calculated in Simple OM

13. Table 3: Baseline emission factor calculated in OMaverage, gCO2/kWh

14. Figure 3: Baseline emission factor calculated in Average OM

15. Part II. Comments and proposals 2.1. Comments Based on using methodologies and calculation, we can conclude as following: • Two specific guiders issued by EB to calculate baseline emission factor are interesting, conservative, that help developers to calculate baseline in their condition. • Baseline emission factors calculated in different options or methodologies will be different. So depending on specific project, applicable conditions, project developers can select an suitable baseline emission factor. In Vietnam case study : • Emission factors of power plants using different fuels are different + Using coal coming down from 1.5 kgCO2/kWh to 1.0 kgCO2/kWh by 2010 year ; + Using oil is about 0.9 kgCO2/kWh ; + Using gas is about 0.45 kgCO2/kWh • Average emission factor of system (1/2OM+1/2BM) having a decreased trend and varying from 0.5 to 0.6 kgCO2/kWh.

16. 2.1. Comments (cont.) • Based on OM curves, it is seen that the baseline emission factors decrease strongly because of increasing thermal plants efficiency and more gas-fired plants built. But since 2006, mainly coal-fired plants will be built, so the factors will be lightly increased. • Since 2002, more thermal power plants are built, this is described on the BM curves, but since 2006, hydropower plants will be relatively large built, so the BM factor will decrease. • However, curves of average OM and BM as well as GA curves are relatively stable.

17. 2.2. Used proposals a) Project registered in 2005, started operating in 2008, with crediting of 10 years • Small-scale project: select the table 1 above, at column of year of 2005, can choose emission factors of ½ OM+ ½ BM (555.4 gCO­2/kWh). • Large scale project: + If total 5 years average hydropower output generated is less than 50% of total electricity output generated of the grid, table 2 will be selected. Then there are 2 emission factors: if based on the most recent statistics available at the time of Project Design Document (PDD) submission then 3 years average emission factor will be used, column of year of 2005 will be chosen (575.9 gCO2/kWh); if based on commissioning year then column of year of 2008 will be chosen (574.6 gCO2/kWh).

18. 2.2. Used proposals (cont.) + Or if total 5 years average hydropower output generated is more than 50% of total electricity output generated of the grid, table 3 will be selected. Then there are 2 emission factors: if based on the most recent statistics available at the time of PDD submission then 3 years average emission factor will be used, column of year of 2005 will be chosen (442.5 gCO2/kWh); if based on commissioning year then column of year of 2008 will be chosen (476.3 gCO­2/kWh). This emission factor will used for project emission reduction calculation for whole 10 year crediting period. b) Project with crediting of 7 years registered in 2005, started operating in 2008: is similar to for crediting of 10 years above, the difference is the emission factor only used in 7 years, if it is continued in more 7 years, the emission factor will has to be re-calculated. Then the new factor may be different from the old one because of data changes.

19. Thank you ! Contact address: E-mail: phungbh@pmail.vnn.vn