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ACTIVITIES IMPLEMENTED JOINTLY (AIJ)

List of Projects

Uniform Reporting Format:

Activities Implemented Jointly Under the Pilot Phase

The uniform reporting format contained below is to be used in reporting on activities implemented jointly under the pilot phase. It is noted that the reporting should be consistent with decision 5/CP.1 and 8/CP.2 (reproduced in annexes I and II to this reporting format). The SBSTA notes that the uniform reporting format could possibly require revision in the light of experience gained and methodological work conducted under the pilot phase.

A. Description of project

A. 1) Title of project: Chile Natural Gas Project

A. 2) Participants/actors:

Please fill in one table for each participant/actor. For individuals fill in as from item A Function within activity".

Item

Please fill in if applicable

Name of organization(a):

The Australian Gas Light Company

Department:

Acronym:

AGL

Function within activity:

Project Finance & Implementation

Street:

111 Pacific Highway

City:

NORTH SYDNEY NSW 2060

Country:

Australia

Telephone:

61-2-9922 8704

Fax:

61-2-9922 8227

E-mail:

------------

WWW-URL:

Contact person (for this activity):

------------

Surname:

Hattersley

First name, middle name:

Stephen

Job title:

General Manager, International Operations

Direct tel:

61-2-9922 8704

Direct fax:

61-2-9922 8227

Direct E-mail:

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Item

Please fill in if applicable

Name of organization(a):

International Greenhouse Partnerships Office

Department:

Department of Industry, Science and Resources

Acronym:

IGP Office/ISR

Function within activity:

Government AIJ/CDM administration

Street:

GPO Box 9839

Post code:

2601

City:

Canberra

Country:

Australia

Telephone:

61-2-6272 4791

Fax:

61-2-6271 6599

E-mail:

igp.office@isr.gov.au

WWW-URL:

http://www.dpie.gov.au/resources.energy/environment/greenhouse/igp/index.html

Contact person (for this activity):

-------------------------------

Surname:

Stevens

First name, middle name:

Mark R.

Job title:

Assistant Manager, International Greenhouse Partnerships Office

Direct tel:

61-2-6272 4791

Direct fax:

61-2-6271 6599

Direct E-mail:

mark.stevens@isr.gov.au

Item

Please fill in if applicable

Name of organization(a):

Gas Licuado Lipigas SA

Department:

Acronym:

Function within activity:

Project Implementation

Street:

Avenida Libertad 601

Post code:

City:

Vina del Mar

Country:

Chile

Telephone:

56-32- 97 9138

Fax:

-----------------

E-mail:

WWW-URL:

Contact person (for this activity):

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Surname:

Fernandez Astudillo

First name, middle name:

Mario

Job title:

General Manager, Gas Valpo

Direct tel:

56-32-97 9138

Direct fax:

56-32-21 3092

Direct E-mail:

Item

Please fill in if applicable

Name of organization(a):

Ministerio de Relaciones Exteriores

Department:

Acronym:

Function within activity:

Government AIJ administration

Street:

Post code:

City:

SANTIAGO

Country:

Chile

Telephone:

562-698 0301

Fax:

562-672 5071

E-mail:

WWW-URL:

Contact person (for this activity):

--------------------------------------------------------------

Surname:

Stein Brygin

First name, middle name:

Rolando

Job title:

Embajador, Director de Medio Ambiente

Direct tel:

562-698 0301

Direct fax:

562-672 5071

Direct E-mail:

dima@minrel.cl

Item

Please fill in if applicable

Name of organization(a):

Comision Nacional del Medio Ambiente

Department:

Departamento Descontaminacion Planes Y Normas

Acronym:

CONAMA

Function within activity:

Government AIJ administration

Street:

Obispo Donoso 6, Providencia, Casilla 265, Correo 55

Post code:

City:

SANTIAGO

Country:

Chile

Telephone:

Fax:

E-mail:

--------------------

WWW-URL:

Contact person (for this activity):

--------------------

Surname:

Searle

First name, middle name:

Juan Pedro

Job title:

Climate Change Coordinator

Direct tel:

562-240 5600

Direct fax:

562-244 1262

Direct E-mail:

a) Organization includes: institutions, ministries, companies, non-governmental organizations, etc. involved in the activity, i.e. research institutes associated with the project, auditors, government agency closely following the activity.

A. 3) Activity:

Item

Please fill in if applicable

General description:

The project includes the rehabilitation of existing gas distribution systems in Chile, using nylon pipe technology developed by AGL and already used extensively in Sydney, Australia. The nylon pipe will reduce leakage of greenhouse gas from existing gas pipelines. In addition, greenhouse gas emissions and other associated pollutants arising from the use of fuel oil in industrial facilities will be reduced by converting these facilities to natural gas and installing cogeneration facilities.

The project will build a close working relationship between the government agencies in Chile and Australia which are responsible for the establishment of AIJ projects. At an operational level, the project will strengthen commercial arrangements between AGL and Lipigas, including the transfer of nylon pipe technology developed by AGL.

To provide transparency of emission reductions, the baselines for each element of the project will be independently audited. Auditing will be undertaken by an organisation based in Chile, thereby providing further opportunities for capacity building and the transfer of know-how.

Type of project:a)

Fugitive gas capture, fuel switching, energy efficiency.

Location (exact, e.g. city, region, state):

Not available at this time.

Activity starting date:

August 1999

Expected activity ending date:

December 2003

Stage of activity:b)

In advanced planning stage

Lifetime of activity if different from ending date:c)

The various elements of the project are designed to remain in operation well beyond the AIJ pilot phase.

Technical data:d)

a) For example, using Intergovernmental Panel on Climate Change (IPCC) classification: energy efficiency; renewable energy; fuel switching; forest preservation, restoration or reforestation; afforestation; fugitive gas capture; industrial processes; solvents; agriculture; waste disposal or bunker fuels.

b) Circle the appropriate option.

c) Methodological work will be required to define lifetime of activities.

d) Methodological work will be required to determine for each type of activity what the minimum data requirements are.

A. 4) Cost (to the extent possible):

Item

Total Cost

Cost of the project in US$:

$76 mill (approx)

AIJ component in US$:

$76 mill. (approx)

US$ per avoided ton of CO2 equivalent:

Not available

Describe briefly how costs are determined:

The costs are associated with all elements of the project. The figures in the table are based on a conversion rate $1Aus to $0.63 US.

When all proposed elements of the project are implemented, it is estimated that annual savings in CO2 will be in the region of 1.3 million tonnes. These estimates will be refined for each element of the project, taking into consideration actual emissions at industrial sites immediately prior to implementation of the AIJ activity. The lifetime of the project will also be determined for each project element, taking into consideration the economic life of the equipment to be refurbished. As the economic life of equipment has yet to be determined, it is not possible to estimate the avoided costs of the project at this time.

Further information on emission savings is contained in Section E of this paper.

A. 5) Mutually agreed assessment procedures:

Describe the procedures, including name of organizations involved):

The project contains two main aspects; the rehabilitation of existing city gas distribution systems to reduce fugitive emissions and the conversion of industrial customers from fuel oil and coal to natural gas. The gas distribution aspect of the project will be monitored to compare discrepancies in manufactured gas and gas sales before and after refurbishment of the distribution systems. The conversion aspects will be monitored to compare energy consumption before and after conversion of each customer.

Further information on the determination of greenhouse gas emissions is contained in Section E of this report.

a) Please ensure that detailed contact information for all organizations mentioned is reported under

section A.2 above.

B. Governmental acceptance, approval or endorsement

Bearing in mind that all activities implemented jointly under this pilot phase require prior acceptance, approval or endorsement by the Governments of the Parties participating in these activities, which shall be shown as follows:

(a) In the case of joint reporting, the report is submitted by the designated national authority of one participating Party with the concurrence of all other participating Parties as evidenced by attached letters issued by the relevant national authorities;

(b) In the case of separate reporting, the reports are submitted separately by the designated national authority of each and every participating Party. Information will only be compiled once reports have been received from all participating Parties.

B. 1) For the activity:

The joint reporting on this project has been endorsed by the project participants; namely the Ministerio de Relaciones Exteriores, Comision Nacional del Medio Ambiente, the International Greenhouse Partnerships Office, the Australian Gas Light Company and Gas Licuado Lipigas SA.

B. 2) This report is a joint report:

The presentation of this report and its contents are considered to be submitted as a joint report from the Ministerio de Relaciones Exteriores, Comision Nacional del Medio Ambiente, the International Greenhouse Partnerships Office, the Australian Gas Light Company and Gas Licuado Lipigas SA.

B. 3) General short comment by the government(s) if applicable:

C. Compatibility with and supportiveness of national economic development and socioSeconomic and environment priorities and strategies

Describe (to the extent possible) how the activity is compatible with and supportive of national economic development and socioSeconomic and environment priorities and strategies

This project has a variety of non-greenhouse benefits.

The rehabilitation, co-generation and conversion technologies to be utilised in this project have been developed and improved by AGL over the past 20 years and are leading, world standard technologies. The lengthy nature of the program and the establishment of nylon pipe making facilities in the host country means that there is a complete technology transfer to the host country.

The substitution of natural gas for other less energy efficient fuels such as coal and oil not only reduces greenhouse gas emissions but also other pollutants such as SOxx because natural gas has lower amounts of sulphur and other impurities than coal and oil.

The project will also deliver economic benefits for Chile and its industrial enterprises in the form of reduced energy costs. However, AGL and Lipigas will bear significant costs in the short term. The IGP Office is reducing the cost burden by bearing some of these costs; notably costs associated with baseline determination and monitoring and verification of emission reductions.

D. Benefits derived from the activities implemented jointly project

Whenever possible, quantitative information should be provided. Failing that, a qualitative description should be given. If quantitative information becomes available, it could be submitted using the update(s). (If the amount of quantitative information is too large, the source could be indicated.)

Item

Please fill in

Describe environmental benefits in detail.

As outlined above, the project will lead to a major reduction in greenhouse gas emissions arising from the reduction in fugitive emissions from gas distribution systems, and from the conversion of industrial sites from fuel oil and coal to natural gas also with consequent improvements in energy efficiency. In addition, the project will lead to reduction in pollutants (SOx, particulates) arising from the use of natural gas in place of fuel oil and coal.

Do quantitative data exist for evaluation of environmental benefits?

Yes

Describe social/cultural benefits in detail:

As outlined in Section C, the project will deliver a wide variety of social benefits.

The project will increase employment, throughout the local manufacture of nylon pipe technology. In addition, by reducing the energy costs of Chile’s energy intensive industry, the project will improve the international competitiveness of these industries and enhance employment in these industries. The project will also have a positive impact on the balance of payments of Chile by reducing the domestic demand for petroleum products (fuel oil).

Do quantitative data exist for evaluation of social benefits?

No

Describe economic benefits in detail:

See above.

Do quantitative data exist for evaluation of economic benefits?

Information gathered from this project will enable an assessment to be made of the economic benefits of the project

E. Calculation of the contribution of activities implemented jointly projects that bring about real, measurable and long-term environmental benefits related to the mitigation of climate change that would not have occurred in the absence of such activities

E. 1) Estimated emissions without the activity (project baseline):

Description of the baseline or reference scenario, including methodologies applied:

As noted above, it is estimated that the project will, once fully implemented, lead to a reduction in greenhouse gas emissions of some 1.3 million tonnes per annum.

In relation to the gas distribution systems, Lipigas has determined, from metering of city gas manufactured compared with gas sales, that Unaccounted for Gas (UAG) is about 12% of gas manufactured. UAG is made up of gas losses from fugitive emissions and metering inaccuracies. The main component of the UAG is likely to arise from fugitive emissions. However, this will be confirmed by comparing UAG levels before and after refurbishment. Metering inaccuracies are expected to remain constant before and after refurbishment although efforts will be made to refine the estimates of metering inaccuracies. The methods developed to verify the accuracy of current emissions will be used to verify emissions after refurbishment. Procedures to monitor the various elements of UAG are well established in the international gas industry.

In relation to natural gas conversion elements of the project, the baselines for each element will be determined from the consumption of fuel oil and or coal by the industrial plant prior to its conversion to natural gas. Current fuel consumption will be determined using records of the company or its fuel supplier and savings will be calculated by comparing current fuel use with metered use of natural gas after conversion. In determining emission reductions, allowance will be made for variations in production volume by determining emission reductions on an equivalent unit basis (eg. kg of steam, kWh of electricity, tonnes of product).

The specific details of baseline development (including independent auditing) and project monitoring will be subject to the agreement of the project participants, including the designated national authorities for AIJ in Chile and Australia.

E. 2) Estimated emissions with the activity:

Description of the scenario, including methodologies applied:

See Section E1

E.2.1) Summary table: Projected emission reduction s:

GHG

Over Project Year

A) Project baseline scenario

CO2

B) Project activity scenarioa)

CO2

C) Effect ( B-A )

CO2

D) Cumulative effect

CO2

a) Includes indirect GHG leakages.

F. Bearing in mind that the financing of activities implemented jointly shall be additional to financial obligations of Parties included in Annex II to the Convention within the framework of the financial mechanism as well as to current official development assistance flows , please indicate

Source of project funding

(For each source one line)

Amount

(US dollars)

AGL/Lipigas

$78 million (approx.)

IGPO

$220,000 (approx)

G. Contribution to capacity building, transfer of environmentally sound technologies and know-how to other Parties, particularly developing country Parties, to enable them to implement the provisions of the Convention. In this process, the developed country Parties shall support the development and enhancement of endogenous capacities and technologies of developing country Parties

As noted under Sections C and D of this report, the project will contribute significantly to capacity building and in the transfer of environmentally sound technologies and know-how to the developing country Parties involved in the project.

H. Additional comments, if any, including any practical experience gained or technical difficulties, effects, impacts or other obstacles encountered

Annex I

EXTRACT FROM:

FCCC/CP/1995/7/Add.1:

REPORT OF THE CONFERENCE OF THE PARTIES

ON ITS FIRST SESSION, HELD AT BERLIN FROM 28 MARCH TO 7 APRIL 1995

Addendum

PART TWO: ACTION TAKEN BY THE CONFERENCE OF THE PARTIES

AT ITS FIRST SESSION

Decision 5/CP.1

Activities implemented jointly under the pilot phase

The Conference of the Parties,

Recalling that, in accordance with Article 4.2(d) of the United Nations Framework Convention on Climate Change, the Conference is required to take decisions regarding criteria for joint implementation as indicated in Article 4.2(a),

Noting that the largest share of historical and current global emissions of greenhouse gases has originated in developed countries, that per capita emissions in developing countries are still relatively low and that the share of global emissions originating in developing countries will grow to meet their social and development needs,

Acknowledging that the global nature of climate change calls for the widest possible co-operation by all countries and their participation in an effective and appropriate international response, in accordance with their common but differentiated responsibilities and respective capabilities and their social and economic conditions,

Recognizing that,

(a) According to the provisions of the Convention, the commitments under

Article 4.2(a) to adopt national policies and to take corresponding measures on the mitigation of climate change apply only to Parties included in Annex I to the Convention (Annex I Parties), and that Parties not included in Annex I to the Convention (non-Annex I Parties) have no such commitments,

(b) Activities implemented jointly between Annex I Parties and non-Annex I Parties will not be seen as fulfilment of current commitments of Annex I Parties under Article 4.2(b) of the Convention; but they could contribute to the achievement of the objective of the Convention and to the fulfilment of commitments of Annex II Parties under Article 4.5 of the Convention,

(c) Activities implemented jointly under the Convention are supplemental, and should only be treated as a subsidiary means of achieving the objective of the Convention,

(d) Activities implemented jointly in no way modify the commitments of each Party under the Convention,

1. Decides:

(a) To establish a pilot phase for activities implemented jointly among Annex I Parties and, on a voluntary basis, with non-Annex I Parties that so request;

(b) That activities implemented jointly should be compatible with and supportive

of national environment and development priorities and strategies, contribute to

cost-effectiveness in achieving global benefits and could be conducted in a comprehensive manner covering all relevant sources, sinks and reservoirs of greenhouse gases;

(c) That all activities implemented jointly under this pilot phase require prior acceptance, approval or endorsement by the Governments of the Parties participating in these activities;

(d) That activities implemented jointly sh