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ACTIVITIES IMPLEMENTED JOINTLY(AIJ)


 
USIJI Uniform Reporting Document:
Activities Implemented Jointly Under the Pilot Phase

List of Projects

A. Description of the AIJ project

1. Title of project: Plantas Eólicas S.A. Wind Facility

2. Host country: Costa Rica

3. Brief project description:

The Plantas Eólicas S.A. Wind Facility Project involves the construction and operation of a privately owned and operated 20 megawatt (MW) wind facility near the town of Tejona in the Guanacaste province of Costa Rica. The facility has been in operation since June 1996. Electricity generated by the plant is being sold to the Costa Rican Institute of Electricity (ICE) to meet a portion of Costa Rica's energy demand. Because this generation will displace electricity that would have otherwise been generated by existing thermal plants, it reduces greenhouse gas (GHG) emissions from fossil fuel combustion.

4. Participants:

Name of Organization or Individual

Country

Plantas Eólicas, S.A. (PESA)

Costa Rica

Charter Oak Energy, Inc. (COE)

U.S.A.

Northeast Utilities (NU)

U.S.A.

Item

Organization

Name of organization (original language)

or

Name of individual if unaffiliated with any organization

Plantas Eólicas, S.A.

Name of organization (English)

Acronym (original language)

PESA

Acronym (English)

PESA

Department

Function(s) within the AIJ project activities

Street

Apdo. 250-1002

City

San José

State

Post code

Country

Costa Rica

Telephone

506-258-0843

Fax

506-256-5608

E-mail

World Wide Web-URL address

Administrative Officer Responsible for the Project

Surname

Henderson

First name, middle name

Brian H.

Job title

President

Direct telephone

860-665-5682

Direct fax

860-665-5877

Direct e-mail

Contact Person for AIJ Activities (if different from the Administrative Officer)

Surname

Fischel

First name, middle name

Edwin M.

Job title

Direct telephone

506-258-0843

Direct fax

506-256-5608

Direct e-mail

Item

Organization

Name of organization (original language)

or

Name of individual if unaffiliated with any organization

Charter Oak Energy, Inc.

Name of organization (English)

(Same as above)

Acronym (original language)

COE

Acronym (English)

(Same as above)

Department

Function(s) within the AIJ project activities

Street

107 Selden Street

City

Berlin

State

Connecticut

Post code

06037-1616

Country

U.S.A.

Telephone

860-665-5799

Fax

860-665-5877

E-mail

World Wide Web-URL address

Administrative Officer Responsible for the Project

Surname

Curry

First name, middle name

Brian E.

Job title

Managing Director

Direct telephone

860-665-5799

Direct fax

860-665-5877

Direct e-mail

Contact Person for AIJ Activities (if different from the Administrative Officer)

Surname

Morisette

First name, middle name

John R.

Job title

Principal

Direct telephone

806-665-5605

Direct fax

806-665-5877

Direct e-mail

MORISJR@NU.COM

Item

Organization

Name of organization (original language)

or

Name of individual if unaffiliated with any organization

Northeast Utilities

Name of organization (English)

(Same as above)

Acronym (original language)

NU

Acronym (English)

(Same as above)

Department

Function(s) within the AIJ project activities

Street

107 Seldon Street

City

Berlin

State

Connecticut

Post code

06037-1616

Country

U.S.A.

Telephone

800-286-5000

Fax

E-mail

World Wide Web-URL address

Administrative Officer Responsible for the Project

Surname

Ilberman

First name, middle name

Barry

Job title

Vice President, Corporate Environmental Affairs

Direct telephone

860-665-5236

Direct fax

860-665-3777

Direct e-mail

Contact Person for AIJ Activities (if different from the Administrative Officer)

Surname

Stillinger

First name, middle name

William L.

Job title

Director, Research and Environmental Planning

Direct telephone

860-665-5212

Direct fax

860-665-3777

Direct e-mail

5. Description of AIJ project activities

Item

Type of Project

Sector(s)

Energy

Primary activity(ies)

Alternative energy generation (wind)

Project Location

Country

Costa Rica

Exact location (city, state, region)

Northwest of Lake Arenal and north of the village of Tejona, Guanacaste Province

Key Dates and Current Stage of Project

Project starting date (month/year)

January 1995

Project ending date (month/year)

May 2016

Project lifetime (years)

21 years and 5 months

Current stage of project

In progress; plant commenced operations June 1996

General Project Description and Technical Data


The Plantas Eólicas project is a privately owned and operated 20 MW wind facility near the town of Tejona in Costa Rica. Electricity generated by the plant is being sold to the Costa Rican Institute of Electricity (ICE) to meet a portion of Costa Rica's energy demand. Because this generation displaces electricity that would have otherwise been generated by existing thermal plants, it reduces GHG emissions from fossil fuel combustion.

The 20 MW powerplant consists of 55 KENETECH Model 33M-VS third generation variable speed wind turbines. Initial projections indicate that the project can generate between 76 and 98 gigawatthours (GWh) per year, displacing thermal units that burn primarily high-sulfur diesel fuel, fuel oil, and IFO 180 fuel.

The wind resource in Costa Rica is at its strongest during the time when reservoirs are lowest, which coincides with Costa Rica's peak energy use season - January through August - and weakest when water flow exceeds storage capacity in September and October. Thus, adding wind to its power source portfolio would allow ICE to optimize its use of wind and hydroelectric resources. Wind resource surveys indicate that Costa Rica is a good choice for developing a wind electric project to achieve carbon emission reductions.

6. Cost

(a) Explanation of methodology for calculating cost data

Methodology for Calculating Cost Data


The total capital cost of the project was estimated to be approximately $27 million (all cost figures quoted are in 1994 U.S. dollars). This estimate includes (i) facility costs associated with the actual physical plant and transmission/interconnection costs, and (ii) non-facility costs, such as legal and financing costs associated with project development.

(b) Cost data-Project development

This information is considered confidential by the developer and therefore is not available.

(c) Cost data-Project implementation

This information is considered confidential by the developer and therefore is not available. 7. Monitoring and verification of AIJ project activities and results

Item

Party(ies) that will be monitoring project activities

Plantas Eólicas, S.A.

Party(ies) that will be externally verifying project results

This information is not yet available (see below).

Date when the monitoring plan became (or will become) operational (month/year)

This information is not yet available.

Types of data that will be collected

Fossil fuel use for electricity generation, by fuel type

Description of Monitoring and Verification Activities and Schedule for Implementation


The MINAE Office of Energy Policy will provide data annually on the amount of fossil fuel used to generate electricity in Costa Rica. Data for a given year will be published within the first six months of the following year. With technical assistance from MINAE and ICE, this data will be used to develop a greenhouse gas displacement profile for the project.

The project participants agreed to independent external verification of the information presented in the proposal, excluding confidential business information. The participants proposed that an internationally recognized environmental advocacy organization verify the project. Information on the monitoring and verification schedule is not yet available.

B. Governmental approval

Item

Please check one of the following.

This report is a first report.

or

This report is an intermediate report.

or

This report is a final report.

Please check one of the following:

This report is a joint report. Letter(s) of approval of this report from the designated national authority of the other Party(ies) involved in the activity is(are) attached in Section J, Annex.

or

This report is a separate report.

Additional comments (if any):

C. Compatibility with, and supportiveness of, national economic development and socioeconomic and environmental priorities and strategies

Compatibility with Economic Development and Socioeconomic and Environmental Priorities


The project is consistent with Costa Rica's national development policy "to increase energy production through the use of renewable resources." The project is the first commercial-scale wind project in Latin America and the largest private power project in Costa Rica. The project is also compatible with Costa Rica's commitments under the United Nations Framework Convention on Climate Change to "promote and cooperate in the development, application and diffusion, including transfer, of technologies...that control, reduce, or prevent anthropogenic emissions of greenhouse gases."

D. Environmental, social/cultural, and economic impacts of the AIJ project

Non-Greenhouse-Gas Environmental Impacts of the Project


By displacing fossil fuel combustion, the project's non-GHG environmental benefits include a reduction in other air pollutants, which will help to improve overall local and regional air quality.

There are several species of mammals and birds in the region, none of which are expected to be adversely affected by the construction of the project. However, there have been reports from some wind energy projects that birds have been killed by the rotating blades of the wind turbines. The risk of birds getting caught in the wind turbines is substantially reduced, however, if turbines are not positioned in the path of migrating birds or in areas where birds of prey are naturally active. According to the National Biodiversity Institute, the project zone is not a route for migratory birds, or a habitat for birds of prey.

The impact on vegetation during construction will be limited to the removal of the plant layer to install the towers, and construct the transformer pads and access roads. Since the project will be built on grazing land, already substantially altered by cattle, the actual impacts will be negligible. Impacts should, however, be mitigated through replanting of grasses.

Social/Cultural Impacts of the Project


During the construction phase of the project, there was a significant increase in traffic in the area; however, traffic patterns have returned to normal now that the plant is constructed and fully operational. Operation of the facility will not interfere with current land use, which is predominantly cattle grazing.

Economic Impacts of the Project


Positive economic and development impacts of the project will include increased employment and stimulation of local commerce. In addition, the project will help Costa Rica meet its demand for power, which is increasing at a rate of 7% to 9% each year, and reduce the current energy supply shortage.

E. Greenhouse gas impacts of the AIJ project

1. Scenario description

Item

Site Designation

Site number (order of presentation in this report)

1 of 1

Site name/designation

Plantas Eólicas S.A. Wind Facility

Project sector

Energy

Reference Scenario

Primary activity(ies)

Electricity generation from fossil fuels

Has the reference scenario changed since the last report? (If yes, explain any changes below.)

Yes

No

This is the first project report.

Description:

Thermal units in Costa Rica were originally designed to meet only peak demand, while hydroelectric systems were intended to meet base load demand (hydro is preferred because it is half the cost of thermal generation). However, decreased reliability of hydroelectric plants resulting from El Niño drought conditions has forced ICE to rely more heavily on thermal units to meet base load demand. At the same time, energy demand in Costa Rica is growing at a rate of between 7 and 9 percent annually. This rapid growth has put pressure on ICE to continue to expand its current capacity. In September 1994, the Minister of MINAE announced the goal to meet all electricity needs in Costa Rica with renewable energy sources by 2001. However, current energy demand and supply conditions suggest that such a phase-out may be delayed.

In light of ambiguities created by drought and potential conflicts between policy goals and actual utility expansion plans, the proposal provides a broad picture of future GHG emissions in Costa Rica by presenting two sets of reference case projections: one developed by ICE and USAID in 1992, and an "alternative" projection incorporating 1993 fossil fuel consumption data and the September 1994 Costa Rican government policy goals to phase-out fossil fuels. The "alternative" reference scenario is presented in this report simply because it leads to a lower estimate of net project benefits and, hence, is more conservative. The "alternative" reference scenario is based on the assumption that the consumption of diesel and fuel oil for electricity generation in Costa Rica will remain at 1993 levels through 1997, and then decline to zero by 2100.

Predicted Project Scenario

Primary activity(ies)

Alternative energy generation (wind)

Description:

The project site is located in a rural area, with terrain of primarily rolling hills, open fields and ridgelines. The site is currently used primarily for cattle grazing. Construction of a 20 MW wind facility began in December 1995, and was completed in June 1996, when the plant became fully operational. The facility is expected to have a lifetime of 20 years. The project will offset electricity that would have otherwise been generated by existing thermal plants, thereby reducing GHG emissions from fossil fuel combustion. However, emissions in the project scenario occur only until 2001 because all fossil fuel based generation is expected to be replaced by renewable energy resources by that year.

Actual Project

Primary activity(ies)

This information is not yet available.

Description:

This information is not yet available.

2. GHG emission/sequestration calculation methodology

GHG Emission/Sequestration Calculation Methodology

Site number

1 of 1

Project sector

Energy

Description of Calculation Methodology for the Reference Scenario


Using 1993 fossil fuel consumption data as a benchmark and the fossil fuel phase-out plan, the proposal generates an "alternative" reference scenario projection in which emissions fall to zero over the period from 1997 to 2001. The reference scenario is based on emissions from the consumption of diesel and bunker fuel oil used to power Costa Rica's fossil fuel generating plants. In 1993, fossil fuel plants generated 422.8 GWh, and emitted 419,126 t CO2.

Because the proposal assumes that consumption of diesel and fuel oil will remain at 1993 levels through 1997, emissions are held constant at 419,126 t CO2 in 1995, 1996 and 1997. This is fully consistent with the MINAE Minister's announced goal to phase out fossil fuel by 2001, according to which fossil fuel consumption is expected to decline beginning in 1998 until it is totally eliminated by 2001. As the phase-out plan is implemented, emissions from fossil fuel consumption are expected to be reduced approximately 44 percent by 1998, 86 percent by 1999, 99 percent by 2000, and 100 percent by 2001.

Description of Calculation Methodology for the Project Scenario


Because there are no emissions associated with wind energy electricity generation, emissions in the project scenario represent Costa Rican fossil fuel electricity generation that is not displaced by the project's generation. The estimation methodology calculates the displaced generation (i.e., net project benefits), not the remaining generation; hence, annual project scenario emissions are calculated by subtracting annual net project benefits (as calculated below) from annual reference scenario emissions.

Net project benefits are the avoided emissions from displaced fossil fuel generation. Since the project did not begin operating until 1996, no net project CO2 benefits accrue in 1995. Beginning in 1996, net project benefits in a given year are estimated as the ratio of the plant's projected electricity generation (98 GWh) to annual fossil fuel electricity generation in Costa Rica in 1993 (422.8 GWh), multiplied by reference scenario emissions in that year. This is equivalent to deriving a national emissions factor for fossil fuel plants (419,126 t CO2/422.8 GWh), and applying it to the portion of the project's annual generation (GWh) that displaces fossil fuel generation. Emission reductions decline annually until they reach zero in 2001 (based on annual percentage decreases in fossil fuel use anticipated with the total phase-out of fossil fuel plants). By calculating an annual reduction in net project carbon benefits based on the phase-out of fossil fuels, the project attempts to avoid double-counting emission reductions that may be claimed by other wind energy or hydroelectric projects in Costa Rica. Net project benefits are calculated as follows:

Year 1 (1995) (0 t C)

Year 2 (1996) (98 GWh / 422.8 GWh)( 419,126 t CO2)(7/12)

Year 3 (1997) (98 GWh / 422.8 GWh)( 419,126 t CO2)

Year 4 (1998) (98 GWh / 422.8 GWh)(233,150 t CO2)

Year 5 (1999) (98 GWh / 422.8 GWh)(57,152 t CO2)

Year 6 (2000) (98 GWh / 422.8 GWh)(6,169 t CO2)

Year 7 - Year 22 (98 GWh / 422.8 GWh)(0 t CO2)

(2001 - May 2016)

Emission reductions for 1996 have been prorated (multiplied by 7/12) to reflect the date at which the facility came on-line (June 1996).

Description of Calculation Methodology for the Actual Project


This information is not yet available.

3. GHG emission/sequestration data

(a) Reporting of GHG emissions/sequestration

Image

(b) Additional information on GHG emissions/sequestration

Indirect or Secondary GHG Impacts (Positive and Negative)


This information is not yet available.

Factors That Could Cause the Future Loss or Reversal of GHG Benefits


Given the nature of this project-substitution of fossil fuel generated power with wind power-loss or reversal of benefits that have been achieved is not possible. Projected project benefits could only be lost if Plantas Eólicas is no longer able to sell its power. The project developer indicates that the project has a Power Purchase Agreement with ICE, basically ensuring output sales.

Strategy for Reducing the Risk of Future Loss or Reversal of GHG Benefits


Because the project benefits accrue only through the year 2000, and are extremely conservative given historical increases in fossil fuel consumption, the risk of loss or reversal of GHG benefits is very low. Moreover, the proposal indicates that an aggressive maintenance program has been designed to ensure a high windplant capacity factor and extend the useful lifetime of the plant beyond 25 years. Assuming the power sales contract is still in force after 25 years, the project developer will maintain the Plantas Eólicas wind facility by installing new machinery or refurbishing existing turbines so that it continues to generate wind electricity. Depending on the status of load growth and thermal generation, this could potentially allow project GHG emissions reductions to continue well beyond the project lifetime.

F. Funding of the AIJ project

1. Identification of funding sources

(a) Funding sources for project development

The company records indicate:

Funding Source

Country of Funding Source

Amount*($US)

Percent of Total Funding

(%)

COE Tejona Corp.

U.S.A.

65

Manuel Emillo Montero Anderson

Costa Rica

35

Total

100

*This information is considered confidential by the developer and therefore is not available.

(b) Funding sources for project implementation

This information is considered confidential by the developer and therefore is not available.

2. Assessment of additional funding needs

Current or Planned Activities to Obtain Additional Funding


The project is operational and fully funded.

G. Contribution to capacity building and technology transfer

Contribution to Capacity Building and Technology Transfer


The project is the first commercial-scale wind project in Latin America and the largest private power project in Costa Rica. The implementation of the Plantas Eólicas project is anticipated to lay the groundwork for the development of future private sector wind projects in Costa Rica.

H. Recent developments, technical difficulties, and obstacles encountered

Recent Project Developments


This information is not yet available.

Technical Difficulties and Other Obstacles Encountered


This information is not yet available.

I. Additional information

Additional Information


This information is not yet available.

J. Annex

1. Host country acceptance of the AIJ project

Country/Project Title

Name, Title, and Government Agency of the Designated National Authority

Date of Approval(day/month/year)

Costa Rica/Plantas Eólicas S.A. Wind Facility

René Castro S., Minister, Ministry of Natural Resources, Energy and Mines

3 November 1994

2. Letters of approval of this AIJ project report

See attached concurrence form.