CC:INFO/AIJ: REPORT

Uniform Reporting Format:

Activities Implemented Jointly Under the Pilot Phase

A. Description of project

1) Title of project: Boiler Conversion at Birzai, Lithuania

2) Participants/actors:

Item	Financier/Reporter	Co-reporter
Name of organisation(a):	Statens energimyndighet	Aplinkos Ministerija
Name of organisation (English):	Swedish National Energy Administration	Ministry of Environment
Department:	Secretariat for Climate Policy and International Co-operation	Environmental Quality Department
Acronym:	STEM	AM
Acronym (English):	STEM	MoE
Function within activity:	Assigned by the Swedish Government for implementation including financing arrangements.	Assigned by the Lithuanian Government for activities implemented jointly
Street:	Kungsgatan 43	Jakšto 4
Post code:	BOX 310, S-631 04	LT-2600
City:	Eskilstuna	Vilnius
Country:	Sweden	Lithuania
Telephone:	+46-16 544 20 00	+370-2 61 90 49
Fax:	+46-16 544 22 64	+370-2-22 08 47
E-mail:	klas.tennberg@stem.se	dalia.s@nt.gamta.lt
WWW-URL:	http://www.stem.se	http://www.gamta.lt
Contact person (for this activity):	-------------------------------------	-------------------------------------
Surname:	Knutsson	Bilkis
First name, middle name:	Gudrun	Mindaugas
Job title:	Head of Section, Climate Investment Programme	Director of Environmental Quality Dept.
Direct tel:	+46-16 544 20 72	+370-2-61 90 49
Direct fax:	+46-16 544 22 64	+370-2-22 08 47
Direct E-mail:	gudrun.knutsson@stem.se	atm@nt.gamta.lt

	Borrower
Name of organisation(a):	Birzu Rajono Savivaldybe
Name of organisation (English):	Birzai District Municipality Council
Department:
Acronym:
Acronym (English):
Function within activity:	borrower
Street:	Vytauto 38
Post code:	LT5280
City:	Birzai
Country:	Lithuania
Telephone:	+370 20 31 560 +370 20 31 005
Fax:	+370 20 32 485
E-mail:	birzai@sav.lt
WWW-URL:
Contact person (for this activity):
Surname:	Saltauskas
First name, middle name:	Romas
Job title:	Administrator municipality
Direct tel:	+370 20 31 332
Direct fax:	+370 20 32 485
Direct E-mail:	birzai@sav.lt

Item	Please fill in if applicable	Please fill in if applicable
Name of organization(a):	Lietuvos energetikos institutas	ÅF Energikonsult Syd AB
Name of organization (English):	Lithuanian Energy Institute
Department:	Heat-Equipment Research and Testing Laboratory	AF - International AB
Acronym:	LEI	ÅFE
Acronym (English):	LEI	AFE
Function within activity:	Local reporter Responsible for the measuring and collecting results for EAES-reporting.	Technical support
Street:	Breslaujos 3	Stensjögatan 3
Post code:	LT 3035	S-217 65
City:	Kaunas	MALMÖ
Country:	Lithuania	SWEDEN
Telephone:	+ 370 (7) 75 34 95	+46-40-37 50 00
Fax:	+ 370 (7) 35 12 71	+46-40-13 03 69
E-mail:	testlab@isag.lei.lt
WWW-URL:	http://www.lei.lt	http://www.af.se
Contact person (for this activity):	-------------------------------------	-------------------------------------
Surname:	Pedisius	Mårtensson
First name, middle name:	Nerijus	Roland
Job title:	Senior Research Associate	project leader
Direct tel:	+ 370 (7) 75 31 83	+46-40-37 51 04
Direct fax:	+ 370 (7) 35 12 71	+46-40-13 03 69
Direct E-mail:	nerijus@isag.lei.lt	rmn@ens.af.se

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

3) Activity:

Item	Please fill in if applicable
General description:	Birzai is a middle-sized town close to the border to Latvia. There are two boiler plants that are connected to one network in Birzai. One of the boiler plants had two DE 16-14 oil-fired boilers. The annual energy production at this boiler plant was about 50 000 MWh.
Type of project:a)	Fuel switching to renewable
Location (exact, e.g. city, region, state):	Birzai town Birzai Region LITHUANIA
Activity starting date:	1993-08-13(Letter of Intent)
In operation from:	January 1994
Expected activity ending date:	31. December 2003
Stage of activity:b)	Complete
Lifetime of activity if different from ending date:c)	Expected technical life time is 15 years, the plant is expected to be in operation till 2007
Technical data:d)	Conversion of a DE 16-14 boiler to the use of wood fuels through installation of a pre-furnace. Automatic fuel storage, wood chipper and flue gas cleaning are also included in the project. The output power after the conversion is around 6 MW. Estimated production from bio-fuel boiler 35000 MWh

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.

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

The lifetime criteria have been arranged in different groups depending on type of implemented activities. This classification assumes a level of operation and maintenance that is normal in western countries.

Lifetime of activity

Heat production plants (bio fuel)

25 years	New installation of all main equipment parts (fuel handling system, firing equipment and boiler) and modernisation of secondary equipment.
15 years	Conversion of existing boiler but new installation fuel handling system and firing equipment. Modernisation of secondary equipment.
10 years	Limited installation of new equipment (only one part of the three main parts, normally the firing equipment). Modernisation of other equipment.

Heat distribution systems and sub-stations

25 years	Pre-fabricated pipes and installations using certified contractors and supervisor according to EN norms and applicable district heating practise
15 years	Pre-fabricated pipes and installations without using certified contractors and supervisor
10 years	Modernisation of existing pipes.

Energy efficiency in buildings

25 years

Additional insulation roofs walls etc. with Scandinavian technology.

New installed heating systems.

15 years

Renovation and balancing of heating systems including thermostat valves.

10 years

Weather stripping windows, doors etc.

if a combination of measures is done a reasonable lifetime for the project have to be calculated.

4) Plant cost (to the extent possible):

To the investment costs are referred the cost of the investment proper and the accumulated interest during the grace period, generally 2 years.

The AIJ/JI cost items are the costs for:

Technical assistance, a technical and administrative support from consultants, during the period from definition of the project till commissioning. These costs are paid by STEM.
Follow-up, an annual technical and economic follow-up by consultants, hired by STEM, of the operating results of the plant with the objective to improve on its techno-economic sustainability and its climate effect. The cost indicated is an average cost per project.
Reporting costs – i e costs in connection with the annual reporting of the project’s climate effects to UNFCCC. The cost indicated is an average cost per project.
Administration – average costs of STEM staff per project.
Difference in interest rates. STEM applies for its loans generally an interest rate corresponding to 6-month STIBOR (Stockholm InterBank Rate, in April 1999 3,0 %). Assuming a normal lending rate of 7 % means that this loan is associated with a cost of 4 % in relation to normal lending rate.

Investment/instalment = the borrower’s possible own financing of the investment, followed by the borrower’s repayment of the loan.

All costs in USD

Country		Birzai BC	1993	1994	1995	1996	1997	1998	1999
			0	1	2	3	4	5	6
	Investment	1. Loan/debt to STEM	643375	680125	738750	646375	554000	461625	369250
		2. Added costs	0	36750	58625	0	0	0	0
		3.Technical assistance	130000	0	0	0	0	0	0
	AIJ/JI	4. Follow up	0	8375	8750	10250	10625	2750	2834
A. Sweden	costs	5. Reporting costs	0	0	0	0	1063	2500	930
		6. Administration	40000	0	0	0	0	0	0
		7. Difference in interest	4%	27205	29550	25855	22160	18465	14770
		8.Accum. costs for AIJ/JI	170000	205580	243880	279985	313833	337548	356081
		9.Total costs	813375	885705	982630	926360	867833	799173	725331
	Investment	1. Investment/Instalment	0	0	0	92375	92375	92375	92375
2. Lithuania	AIJ/JI	2. Reporting costs	0	0	0	0	0	0	0
	costs	3. Other costs	0	0	0	0	0	0	0
		4. Accum. costs for AIJ/JI	0	0	0	0	0	0	0
		5. Total costs	0	0	0	92375	184750	277125	369500
1 USD=	8	SEK

5) Mutually agreed assessment procedures:

Describe the procedures, including name of organizations involveda):

Lithuanian Ministry of Environment is a central Lithuanian authority responsible on reporting of JI-projects. This authority assigns a local organisation Lithuanian Energy Institute that is involved in to the evaluation of the climate effects of this project. Lithuanian Energy Institute takes the main responsibility to continue measuring, results collecting for JI-reporting.

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.

* Subsequent reports:

Third report.

This report is a joint report:

Yes, Endorsement letter was submitted 1999.

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

Yes, Agreement with Lithuanian Ministry of the Environment was signed on March 2000.

Activity. The scope of work of this agreement consist of collection basic data, examination project possibilities, engineering, supervision, inspection, local investigations, preparation reports. cf. Annex II, section B.

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

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

The project meets with the following objectives in the Lithuanian energy sector:

- to reduce the energy intensity

- to reduce dependence on fuel imports

- to create new working places

- to involve the local companies into production of equipment for new firing technology

- to create and improve energy infrastructure based on indigenous energy resources

- to utilize the existing energy production capacity efficiently

- to reduce of fossil fuel consumption which results in emission reduction and currency saving

- to develop cooperation between Baltic, Nordic and other Central European countries

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:	Annual emissions reduction: 1999 5 150 ton CO₂ 78 ton SO₂ 2 ton NO_x Lower pollution.
Do quantitative data exist for evaluation of environmental benefits?	Yes. Collected by AF-Energikonsult Syd AB and LEI experts in 1995.
Describe social/cultural benefits in detail:	More stable energy supply. Improved working conditions, increased motivation
Do quantitative data exist for evaluation of social benefits?	No
Describe economic benefits in detail:	Decreased energy costs about 3 USD/MWh which results in emission reduction and currency saving;
Do quantitative data exist for evaluation of economic benefits?	Yes. Collected by LEI experts since 1997 and updated every year.

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

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

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

Present data reflect emission reductions using status quo (emissions in the period before the conversion to renewable fuel) for the baseline case.

Calculation methods are being revised and will result in a change in emission reduction.

The new data will be introduced as soon as available.

2) Estimated emissions with the activity:

Description of the scenario, including methodologies applied:

Emission reductions are calculated using the IPCC Guidelines, using the Carbon Emission Factor (CEF) for different types of fuel, using actual system efficiency. For boiler conversion, the decrease in emissions is calculated in relation to the amount of fossil fuel replaced (status quo).

For energy efficiency project the decrease in emissions reflects the amount of fuel that is saved through the project. In the case that the system uses renewable fuels, the reduction is calculated comparing the amount of fossil fuels that was used before the conversion to renewable fuels.

Below comparison is based upon that the base-line scenario represents a status quo solution.

Fill in the following tables as applicable:

Summary table: Projected emission reductions:

	GHG	Year 1 =1994	Year 2 =1995	Year 3 =1996	Year 4 =1997	Year 5 =1998	Year 6 =1999	…	Year 15
Planned energy production, MWh/year Biofuel Mazout /light-oil		35 000 15 000	35 000 15 000	35 000 15 000	35 000 15 000	35 000 15 000	35 000 15 000		35 000 15 000
Planned annual fuel consumption, MWh/year Biofuel Mazout/light oil		42 683 17 442	42 683 17 442	42 683 17 442	42 683 17 442	42 683 17 442	42 683 17 442		42 683 17 442
A) Project baseline scenario	CO2	16 237	16 237	16 237	16 237	16 237	16 237		16 237
	CH4
	N2O
	SO2
B) Project activity scenarioa)	CO2	4 871	4 871	4 871	4 871	4 871	4 871		4 871
	CH4
	N2O
	SO2
C) Effect ( B-A )	CO2	-11 366	-11 366	-11 366	-11 366	-11 366	-11 366		-11 366
	CH4
	N2O
	SO2
D) Cumulative effect	CO2	-11 366	-22 732	-34 098	-45 464	-56 830	-68 196		-170 490
	CH4
	N2O
	SO2

Includes indirect GHG leakage.

Summary table: Actual emission reductions:

	GHG	Year 1 =1994	Year 2 = 1995	Year 3 = 1996	Year 4 =1997	Year 5 =1998	Year 6 =1999	…	Year 15
Factual energy production, MWh/year Biofuel Mazout /light-oil		35 000	24 700	17 600	15 780	12 682	15 860		17 324
Factual annual fuel consumption, MWh/year Biofuel Mazout/light oil		42 683	30 122	21 463	19 244	15 466	19 341		21 127
A) Project baseline scenario	CO2	11 366	8 021	5 715	5 124	4 118	5 150		5 626
	CH4
	N2O
	Other
B) Project activity scenarioa)	CO2	0	0	0	0	0	0		0
	CH4
	N2O
	other
C) Effect ( B-A )	CO2	-11 366	-8 021	-5 715	-5 124	-4118	-5 150		-5 626
	CH4
	N2O
	Other
D) Cumulative effect	CO2	-11 366	-19 387	-25 102	-30 226	-34 344	-39 494		-90 128
	CH4
	N2O
	Other

Includes indirect GHG leakage.
The converted boiler house have been concentrate on bio-fuel firing, remaining load have been produced in central boiler house (net are connected). Therefore gas has been used to calculate reductions.
On going work aim to increase the load on the converted boiler for that reason future production is estimated to 35 000 MW/h, baseline figures used year 1 real not available.

F. Additionally 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 all sources of project funding.

Category of funding

(For each source one line)

Amount

(US dollars)

Loan from NUTEK

643.375 USD

Grant from NUTEK for technical assistants

130.000 USD

1 USD = 8,00 SEK

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

Transfer of environmentally sound technologies and know-how

Describe briefly

Schematically, the transfer of knowledge involves the following activities over time:

i) Technology transfer through STEM technical specialist during the implementation of the project.

Technology transfer through cooperation between foreign supplier and local partner
Conferences, seminars, documentation and training.

iv) Stimulate "net-working" for the exchange or experience between plant owners with similar problems, e g "bio-clubs"

Technology transfer has taken place through

STEM technical specialist support to the local project leader and municipality.

The following up group for testing and adjustment of converted boilers has been formed in Lithuanian Energy Institute. Personnel of Heat-Equipment Research and Testing Laboratory is carrying out following up procedures keeping a close relation with and AF Energikonsult company as the main supervisor of conversion projects supported by STEM.

The local company "Kazlu Rudos Metalas" with participation of the Swedish company "Hotab" mainly performed the execution of these biofuel conversion projects.

iii) Personal from boiler plant has been invited to different seminars and work-shops, documentation for training has been handed over.

There were arranged three seminars through close cooperation between STEM and LEI:

/Environmentally Friendly Energy Systems in the Baltic and Eastern Europe Countries/ (Seminar), Kaunas, 21-22 March, 1995

/Environmentally Adapted Energy Systems in the Baltic Region and Eastern Europe/ (Seminar), Birzai, 19-20 November 1998.

/Environmentally-Adapted Local Energy Systems /(Seminar and book presentation), Druskininkai, 21 November 1998.

Translation and preparation of safe operation regulations for wood waste burning boiler houses.

This job was supported by STEM.

Association "Bio energy and energy saving" has been founded at the end of 1997 to coordinate the attempts of wood firing equipment producers, wood wastes suppliers and owners of boiler plants.

Endogenous capacity supported or enhanced:

Endogenous capacity

(Name of organization1)

Development (DEV) /

enhancement (ENH)

Describe briefly

AB "Kazlu Rudos Metalas"

AB "Umega"

AB "Kazlu Rudos Metalas"

AB "Singaras"

AB "Elhamers"

DEV

ENH

New biofuel firing technology has been developed. Experience in installation and exploitation of modern western technology.

The straw burning technology has been started to spread as continuation of successfully realized biofuel conversion projects.

Many smaller boiler conversion projects were successfully finished in Lithuania by local companies AB "Kazlu Rudos Metalas", AB "Singaras", AB "Elhamers" during past five years. The implementation of these projects was initiated by the successfully realized STEM projects.

1) Please ensure that detailed contact information for all organizations listed is reported under section A.2 above.

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

Any practical experience gained:

Knowledge about modern bio-fuel technique has made it possible to convert one smaller boiler house in Radviliskis to operate on bio fuel (build 1997-98).

Technical difficulties: The heat losses with flue gas directly after conversion were higher than before it, because the insufficient adjustment of existing boiler and economiser to the pre-furnace installed. The pre-furnace was connected to boiler by the long (6-8 m) channel and, at first the secondary air was supplied at the entrance of the channel instead of the boiler’s entrance. For the reduced flue gas temperature inside boiler and increased it flow-rate, temperature before economiser had increased. These projects faults were removed during the 1994-95. Therefore the previous economic and environmental evaluation started to be valid only after an execution of additional measures.

To balance the network so it will be possible to use the bio fuel boiler with maximum capacity.

There were no serious technical problems with wood waste fired boiler during 1999.

Effects encountered: Execution of biofuel conversion projects according to STEM JI programme caused the activity in the following fields:

- production of pre-furnaces and small wood fired boilers by local companies;

- formation a new policy as respect to cleaning the forests and using the wood wastes or preparation of wood fuel by the forest industries/administrations;

- research and testing the new equipment, execution of the following up activity, training of the local staff etc.

4) Impacts encountered:

Wood-fired boiler operated only during the heating season and operate at reduced capacity in summer time due to lack of consumers. The yearly heat production decreased from 15 780 MWh in 1997 to 12 682 MWh in 1998 but in 1999 it increased to 15860 MWh.

The rise of heat production in 1999 is related to the new consumers that were connected to the net.

5) Other obstacles encountered:

It is necessary to emphasise that insufficient load of converted boiler remains even today for consumption reduced and location of boiler-house quite far from the main consumers. In addition biofuel price constantly increases even at higher rate than the price of mazout. It restricts the efficient use of converted boiler and reduces the benefit for end-users.

6) Other: The separation from the Lithuanian State Energy System/State-owned Company Lietuvos in 1998 Energija and reorganisation in the form of a municipal company had effect on the possibilities to decide about improvements in the system.

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