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ACTIVITIES IMPLEMENTED JOINTLY (AIJ)

List of Projects

USIJI Uniform Reporting Document:

Activities Implemented Jointly Under the Pilot Phase

A. Description of the AIJ project

1. Title of project: Wind Energy in Northern Chile

2. Host country: Chile

3. Brief project description:

  • The Wind Energy Project in northern Chile involves a 37.5 MW wind energy installation. The project expects to include the installation of 50 wind turbines each capable of generating 750 kilowatts of energy. The facility will be constructed near the city of Calama in the desert region of Antofagasta. The preliminary project estimate indicates that the project would off-set approx. 3,000,000 metric tons of CO2 over a 20 year period by displacing coal-fired power generation within the Great Northern Interconnected System (SING). The International Institute for Energy Conservation (IIEC) and the CorporaciÌn Nacional del Cobre de Chile (CODELCO) are jointly developing the project to demonstrate a renewable energy resource and to realize reductions in greenhouse gas emissions.

4. Participants:

Name of Organization or Individual Country

International Institute for Energy Conservation (IIEC)

U.S.A.

CorporaciÌn Nacional del Cobre de Chile (CODELCO)

Chile

Item

Please Complete If Applicable
Organization

Name of organization (original language)

or

Name of individual if unaffiliated with any organization

International Institute for Energy Conservation (IIEC)

Name of organization (English)

Acronym (original language)

Acronym (English)

IIEC

Department

Function(s) within the AIJ project activities

Project coordination and reporting

Street

1015 15th Street, N.W. #600

City

Washington

State

District of Columbia

Post code

20005-2650

Country

U.S.A.

Telephone

202-326-5170

Fax

202-326-5172

E-mail

kgordon@iiec.cerf.org

World Wide Web-URL address

www.cerf.org/iiec/

Administrative Officer Responsible for the Project

Surname

Gordon

First name, middle name

Ms. Kelly

Job title

Director of Programs

Direct telephone

202-326-5170

Direct fax

202-326-5172

Direct e-mail

kgordon@iiec.cerf.org

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

Surname

First name, middle name

Job title

Direct telephone

Direct fax

Direct e-mail

Item

Please Complete If Applicable
Organization

Name of organization (original language)

or

Name of individual if unaffiliated with any organization

CorporaciÌn Nacional del Cobre de Chile (CODELCO)

Name of organization (English)

Acronym (original language)

CODELCO

Acronym (English)

Department

Function(s) within the AIJ project activities

Project implementation

Street

Huerfanos 1270 piso 9

City

Santiago

State

Post code

Country

Chile

Telephone

56 (2) 6903950

Fax

56 (2) 6903917

E-mail

Ftoledo@STGO.CODELCO.CL

World Wide Web-URL address

Administrative Officer Responsible for the Project

Surname

Toledo

First name, middle name

Fernando

Job title

Environmental Affairs

Direct telephone

56 (2) 6903950

Direct fax

56 (2) 6903917

Direct e-mail

Ftoledo@STGO.CODELCO.CL

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

Surname

First name, middle name

Job title

Direct telephone

Direct fax

Direct e-mail

  • 5. Description of AIJ project activities
Item
Type of Project

Sector(s)

Energy

Primary activity(ies)

Alternative Energy Generation

Project Location

Country

Chile

Exact location (city, state, region)

Chile’s region II, in the desert of Chile about 250 km NE of the city of Antofagasta.

Key Dates and Current Stage of Project

Project starting date (month/year)

2002

Project ending date (month/year)

2022

Project lifetime (years)

21

Current stage of project

Mutually agreed

General Project Description and Technical Data

The project will construct a 37.5 MW wind farm to be located in the Antofagasta region of northern Chile. The facility will consist of 50 turbines of 750kW each. CODELCO will either use the electricity generated by the wind farm to power operations at the Chuquicamata copper mine or sell it to the Great Northern Interconnected System (SING). The IIEC and CODELCO are jointly developing this project to realize reductions in greenhouse gas emissions and demonstrate a renewable energy resource. It has been estimated that the project will offset approx. 3,000,000 metric tons of CO2 over the life of the project (20 years). This will be accomplished by displacing coal-fired power generation within the SING.

  • 6. Cost

    • (a) Explanation of methodology for calculating cost data

Methodology for Calculating Cost Data

Total project implementation costs have been estimated at $37.5 million ($1,000 per kilowatt of wind capacity installed). The costs have been estimated by comparing the cost of implementation for this type of a project to the cost of a similar project in other parts of the world. IIEC and CODELCO have estimated a 20-project life (equipment typically has a 20-30 years of useful life). Investment costs for this type of project in other parts of the world are around $1200 per installed kW. In this project, the per kW cost is estimated at $1000 per installed kW due to the low cost of land, availability of roads, a short distance to grid and urban areas, and available labor.

  • (b) Cost data–Project development

    This information is not yet available.

    (c) Cost data–Project implementation

    This information is not yet available.

  • 7. Monitoring and verification of AIJ project activities and results
Item

Party(ies) that will be monitoring project activities

Not yet determined

Party(ies) that will be externally verifying project results

Not yet determined

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

To be determined

Types of data that will be collected

To be determined

Description of Monitoring and Verification Activities and Schedule for Implementation

Monitoring procedures have not been developed. When developed they will integrate an assessment of the contribution of the wind farm in the total energy generation of the system. The valuation of the emissions avoided will be developed through the account of electricity supply coming from the wind farm and the operation of the system. Emission reduction estimates will be estimated annually.

IIEC and CODELCO will work together to determine an appropriate verification organization for this project. An annual reporting schedule consistent with the USIJI program will be designed.

  • 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 will demonstrate the use of wind energy technology, reduce GHG emissions and promote technology transfer to Chile. Electricity generated using this renewable resource will help meet the rising energy needs of the northern region of Chile in a less polluting manner. A cleaner source of energy will support the continued economic development of northern Chile and could offset some of the need for new fossil fired plants.

  • D. Environmental, social/cultural, and economic impacts of the AIJ project
Non-Greenhouse-Gas Environmental Impacts of the Project

The impact of the project on sulfur dioxide emissions has not been estimated. The project team will assess the impact once the configuration of the wind system is fully described. There is a potential of visual and noise impacts of the wind farm, however, the project team does not feel that this will be a problem due to the fact that the proposed location is sparsely populated and not located in a protected natural area.

Social/Cultural Impacts of the Project

This information is not yet available.

Economic Impacts of the Project

This project will allow Chilean companies to develop local technology for installation of the turbines and of the system required by the operation of the plant. The operation and maintenance can be performed by local companies thus benefiting the economy.

  • 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

Chile’s region II, 22 degrees south latitude, in the desert of Chile, about 250 km northeast of the city of Antofagasta.

Project sector

Energy

Reference Scenario

Primary activity(ies)

Alternative Energy Generation

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

Yes

No

This is the first project report.

Description:

The proposed project site is currently under state ownership and has no other planned uses. The nearest population to the plant site is approx. 20km. Due to the close proximity of mining activity to the project site, there are roads capable of supporting heavy equipment and trucks.

The project needs to consider the impact of the wind turbines or the generating system on the navigation system used by the airport located about 15 km from the proposed site.

Predicted Project Scenario

Primary activity(ies)

Alternative Energy Generation

Description:

The specific measure to reduce greenhouse gas emissions is the installation of turbines and auxiliary equipment to generate electricity-using wind. Electricity generated by the wind farm would be sold to the regional grid or directly used to power operations of the Chuquicamata copper mine. Current electricity consumption at CODELCO’s Chuquicamata mine is 2,233 GWh per year. It is estimated that roughly 97.2% of the electricity consumed is provided by the Tocopilla power plant. Tocopilla is a private coal-fired power generator. Future demand for electricity is expected to be met through Tocopilla’s production or through purchases from the grid Sistema Interconectado del Norte Grande (SING). Ninety-five percent of the SING’s electricity generating capacity (1120MW) is coal fired, while the remainder is diesel-fired. Generators in the SING have committed to construct an additional 300 MW of coal-fired capacity and 700 MW of natural gas combined cycle plant in the next 3-5 years. Consumption rates are expected to increase due to a sharp increase in energy consumption that is being driven by growth in the in the mining and industrial sectors in the region. The delivered price of a new natural gas supply from Argentina is expected to be lower than coal-fired power. Therefore, coal plants would become the marginal plants. This project plans to introduce wind energy as an alternative to coal. Additional wind capacity is expected to offset coal-fired power at the margin. The effectiveness of the wind farm to avoid GHG emissions depends on the amount of electricity delivered to the grid.

Current CO2 emissions related to Chuquicamata’s electricity consumption are estimated by CODELCO to be 2.937 million metric tons per year. By introducing alternative technology, there is a high potential for renewable energy to reduce GHG.

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

The baseline estimate refers to the 37.5 MW and 111.47 Gwh of electricity that would be provided by the proposed wind energy project (the proposed project assumes the wind facility will displace 111.47 GWh of coal-generated electricity per year and applies an emission factor of 1,300 g CO2/kWh to calculate annual, CO2 emissions).

Description of Calculation Methodology for the Project Scenario

Using wind statistics gathered over several years near the project site, an anticipated annual power production of 111.47 GWh per year was estimated. Within the timeframe of this project, coal is anticipated to be the marginal fuel. Since natural gas from Argentina to fuel the new turbine capacity will be less expensive these units will be dispatched first. The windfarm will displace coal and the offset will be approx. 145,000 tons per year of CO2.

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

Image

  • (b) Additional information on GHG emissions/sequestration

Indirect or Secondary GHG Impacts (Positive and Negative)

Factors that could prevent the magnitude of benefits anticipated include failure of the wind turbines, changes in wind patterns over time, and changes in competing power sources over time.

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

The loss or reversal of project benefits is not a significant issue. Each kWh of power generated by the wind facility and dispatched to the grid or mine will produce a permanent benefit in the form of avoided emissions from the fossil fuel combustion.

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

F. Funding of the AIJ project

  • 1. Identification of funding sources

    • (a) Funding sources for project development

      A preliminary feasibility assessment for this type of facility was conducted by EDELNOR S.A. and U.S. Windpower in 1993. The project was not funded. Technical assistance was recently provided by the USIJI so that the project could be reevaluated.

      Coldeco applied for and received a $25,000 grant from the U.S. Trade and Development Agency (US-TDA) to conduct a definitional study of the Calama wind project. The study confirmed the potential of the wind project, and prompted Coldeco to apply for and receive approval for a US$275,000 grant, also from US-TDA, to fund a feasibility study. US-TDA regulations require that the study be carried out by a U.S. firm. A request for proposal was published in the Commerce Business Daily, with a closing date in May. Coldeco will select the winning proposal. The feasibility study is expected to begin in June 2000, and last about a year. The feasibility study will be very comprehensive, covering such issues as: quantification of emissions offsets, preparation of carbon verification/certification protocol; development of contractual and financial project structures; identification of hardware requirements, and procurement process; and evaluation of project risks and critical success factors.

      (b) Funding sources for project implementation

      CODELCO Chile anticipates investing in the project as an equity investor along with outside investors. CODELCO plans to sell its participation in the venture and remain s a buyer of power from the wind plant in the long term.

      IIEC has agreed to help identify other potential investors.

    2. Assessment of additional funding needs

Current or Planned Activities to Obtain Additional Funding

This information is not yet available.

  • G. Contribution to capacity building and technology transfer
Contribution to Capacity Building and Technology Transfer

This information is not yet available.

  • 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

None.

  • 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)

Chile/Wind Energy in Northern Chile

Ambassador Stein of Chile; State Department

18 December 1998
  • 2. Letters of approval of this AIJ project report

    • Letters of support have been provided by:

      Rodrigo Egana Barona, Executive Director, National Environment Commission (CONAMA)