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.

List of Projects

1. Description of project

1. Title of project:
2. Participants/actors:

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

Item	Please fill in if applicable
Name of organization (a) :	Secretaria de Hacienda y Crédito Publico
Name of organization (English):	Ministry of Finance and Public Credit
Department:	International Finance
Acronym:	SHCP
Acronym (English):
Function within activity:	Mexican government contact for finance of the project
Street:	PO Box 03100
Post code:
City:	Mexico D.F.
Country:	Mexico
Telephone:	(52) 52-28-17-87/88
Fax:	(52) 52-28-16-85
E-mail:
WWW-URL:
Contact person (for this activity):
Surname:	Vázquez
First name, middle name:	Carlos
Job title:	Director of the Organism International Finance
Direct tel:
Direct fax:
Direct E-mail:

1. 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.

Item	Please fill in if applicable
Name of organization(a):
Name of organization (English):	Norwegian Ministry of Foreign Affairs
Department:	Resource Department
Acronym:
Acronym (English):
Function within activity:	Norwegian government contact
Street:	P.O. Box 8114
Post code:	DEP, N-0032
City:	Oslo
Country:	Norway
Telephone:	47 22 24 36 03
Fax:	47 22 24 36 27 82
E-mail:
WWW-URL:
Contact person (for this activity):
Surname:	Bjornebye
First name, middle name:	Erik
Job title:	Head of Division
Direct tel:
Direct fax:
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.

Item	Please fill in if applicable
Name of organization(a):	Banco Nacional de Obras y Servicios Públicos
Name of organization (English):	National Bank of Public Works and Services
Department:	Organismos Financieros Internacionales (International Financial Organizations)
Acronym:	BANOBRAS
Acronym (English):	BANOBRAS
Function within activity:	Grant recipient and manager of grant funds
Street:	Tecoyotitla 100, 3er Piso
Post code:	Col. Florida 01030
City:	Mexico D.F.
Country:	Mexico
Telephone:	(52) 57-23-62-68
Fax:	(52) 57-23-61-55
E-mail:
WWW-URL:
Contact person (for this activity):
Surname:	Diaz Aguilera
First name, middle name:	Ismael
Job title:	Head of International Financial Organizations Department
Direct tel:
Direct fax:
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.

Item	Please fill in if applicable
Name of organization(a):	Comisión Federal de Electricidad
Name of organization (English):	Federal Electricity Commission
Department:	Subdirectorate for Evaluation and Coordinating Unit for the ILUMEX Project (Subgerencia de Evaluación y La Unidad Coordinadora del Proyecto ILUMEX)
Acronym:	C.F.E.
Acronym (English):	C.F.E.
Function within activity:	Project implementor and grant beneficiary
Street:	Rio Atoyac 97, 5o Piso, sala 507
Post code:	Col. Cuauhtémoc 06598
City:	Mexico D.F.
Country:	Mexico
Telephone:	(52) 55-14-65-69
Fax:	(52) 52-07-02-96
E-mail:
WWW-URL:	http://www.cfe.gob.mx
Contact person (for this activity):	Rita Saucedo
Surname:	Vargas Nieto
First name, middle name:	Enrique
Job title:	Subdirector for Evaluation and Head of the Coordinating Unit for the ILUMEX Project
Direct tel:	(52) 55-14-65-69
Direct fax:	(52) 52-07-02-96
Direct E-mail:	cvargas@cfe.gob.mx

• ^(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.

Item	Please fill in if applicable
Name of the national authority:	Instituto Nacional de Ecología (INE)-Secretaria de Medio Ambiente, Recursos Naturales y Pesca (SEMARNAP)
Name of the national authority (English):	National Institute of Ecology (INE)-Ministry of Environment, Natural Resources and Fisheries (SEMARNAP)
Department:	Dirección General de Regulación Ambiental (Direccion General of Environmental Regulation)
Acronym:	DGRA
Acronym (English):	DGRA
Function within activity:	AIJ focal point in Mexican government
Street:	Av. Revolución 1425, Delegación Álvaro Obregón, Torre ejecutiva Nivel 6
Post Code:	01040
City:	México, D.F.
Country:	México
Telephone:	(52) 56-24-36-45
Fax:	(52) 56-24-35-93
E-mail:	jmartine@ine.gob.mx
WWW-URL:	http://www.ine.gob.mx
Contact Person (for this activity):	Julia Martínez
Surname:
First name, middle name
Job Title:
Direct Tel:
Direct fax:
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.

Item	Please fill in if applicable
Name of organization(a):	El Banco Mundial
Name of organization (English):	The World Bank
Department:	Sector Leadership Group; Latin America and the Caribbean
Acronym:
Acronym (English):
Function within activity:	Project Manager
Street:	1818 H Street N. W.
Post code:	20433
City:	Washington DC
Country:	USA
Telephone:	202 477 1234
Fax:
E-mail:
WWW-URL:
Contact person (for this activity):
Surname:	Cosenza
First name, middle name:	Luis
Job title:	Principal Power Engineer
Direct tel:	201 458 2806
Direct fax:	202 676 1821
Direct E-mail:	lconsenza@worldbank.org

• ^(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.

Item	Please fill in if applicable
Name of organization(a):
Name of organization (English):	International Institute for Energy Conservation
Department:
Acronym:	IIEC
Acronym (English):
Function within activity:	Consultant for feasibility study on energy savings and emissions benefits
Street:	750 First St. N.E., Suite 940
Post code:	20002
City:	Washington D.C.
Country:	USA
Telephone:	202 842 3388
Fax:
E-mail:
WWW-URL:
Contact person (for this activity):
Surname:	Russell
First name, middle name:	Sturm
Job title:	President
Direct tel:	202 842 3388
Direct fax:	202 842 1565
Direct E-mail:	rsturm@iiec.org

• ^(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.

Item	Please fill in if applicable
Name of organization(a):	Universidad Nacional Autónoma de México
Name of organization (English):	Mexico’s National Autonomous University
Department:	University Energy Program
Acronym:	PUE
Acronym (English):	UEP
Function within activity:	Estimation of Emissions Benefits
Street:	Circuito Exterior, Cd. Universitaria
Post code:	P.O. Box 70-172 México, D.F. 04510
City:	Mexico D.F.
Country:	Mexico
Telephone:	525-550-09-31
Fax:	525-6-22-85-32
E-mail:	juaquin@servidor.unam.mx
WWW-URL:	http://serpiente.dgsca.unam.mx/pue/
Contact person (for this activity):
Surname:	Quintanilla
First name, middle name:	Juan
Job title:	Investigator of the University Energy Program
Direct tel:	525-550-09-31
Direct fax:	525-6-22-85-32
Direct E-mail:	juaquin@servidor.unam.mx

• ^(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.

1. Activity:

Item	Please fill in if applicable
General description:	See below.
Type of project:)	Energy efficiency/demand side management.
Location (exact, e.g. city, region, state):	Guadalajara and Monterrey, Mexico.
Activity starting date:	May 19, 1994: Agreement signed between the governments of Norway and Mexico. May 1995: Sale of high efficiency compact fluorescent light bulbs (CFLs) began.
Expected activity ending date:	December 1999
Stage of activity:	Concluded.
Lifetime of activity if different from ending date:	The emissions impact of the activity will continue until early 2006, based on a 33 month phase-in for the bulb sales and an assumed eight year life of each bulb. CFE submitted the results of the final participant survey in September 1998 and have collected payments for bulbs sold on credit until December 1999. Additional CFLs purchased with money from the sales of the first 1.7 million bulbs have been sold during May 1998.
Technical data:	See Appendix A for a list of selected reports related to the project; Appendix B for details on the estimation of emissions benefits; and Appendix C for detailed financial cost/benefit data.

1. 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.
2. 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.

GENERAL PROJECT DESCRIPTION (ILUMEX)

Background: At the time of the project appraisal in 1992, demand for electricity in Mexico was expected to grow by more than 5% per year. Such growth would result in the need to add 14,000 MW of capacity over the following 10 years, with investments of $3 billion per year. Mexico's installed generating capacity is 80% thermal and emits an estimated 57 million tons of carbon dioxide per year as well as emissions of other pollutants such as sulfur dioxide and nitrogen oxide.

The average price for electricity in Mexico is below long run marginal costs. Significant cross subsidies exist among residential consumers with medium to large consumers subsidizing smaller users. The Federal Electricity Commission of Mexico (CFE) is committed to eliminating these subsidies and had, at the time of the project appraisal, the aim of raising the average price to equal long run marginal costs by 1997.

Project Description: The AIJ component of the project have replace approximately 200,000 ordinary, incandescent light bulbs with compact fluorescent light bulbs (CFLs) in the Mexican cities of Monterrey and Guadalajara. This represents approximately 11.8% of the project total of 1.7 million replaced bulbs. These CFLs require 25% of the energy of ordinary light bulbs to produce similar or better quality lighting, resulting in less electricity generation and fewer fossil fuel emissions. They last up to 10,000 hours, or thirteen times longer than ordinary bulbs.

The AIJ component of the project was funded with $3 million USD from the Department of Natural Resources and Environmental Affairs of the Government of Norway. Non-AIJ related financing of the project includes a grant of $10 million USD from the GEF, and an additional $10 million USD was contributed by the CFE for total project funding of $23 million. Norway's contribution have pay for 200,000 CFLs, or approximately 12% of the project emissions benefits. Funding was placed in trust funds set up with the Banco Nacional de Obras y Servicios Publicos (BANOBRAS), with money that was used exclusively for the project.

The CFE, through its implementing units in the two cities, have administered the project by purchasing the CFLs and selling them at 37% of cost (including project overhead and administration) to their customers at existing customer service centers and at large companies. It was necessary, other methods, such as door to door sales. Customers could buy the bulbs on credit terms of up to 2 years. Customer payments for the bulbs have been returned to the trust fund set up at BANOBRAS and used to subsidize additional light bulb sales. It was anticipated that, in addition to the 1.7 million bulbs within the initial project scope, several hundred thousand additional bulbs have been purchased by CFE and sold to customers as a result.

The ILUMEX project was designed to replace 1.7 millions bulbs in a lapse of two years in two of the most biggest cities of Mexico. This have change and it was sold almost 2.5 millions bulbs in three years of selling, in addition, there were included the cities of Nuevo León, Jalisco, Coahuila, Tamaulipas, Colima, Nayarit and Michoacán.

With this, it was avoided to buy 3.6 millions of incandescent bulbs, because they last only 750 hours. The distributions of sallied CFL were 54% for Jalisco and 46% for Nuevo León.

The detailed analysis of the acquisitions and selling, it allowed us to conclude that the costumers were eager to save energy and arranged to acquire bulbs of CFL, they were from special market, most of all from the middle or biggest category in its electric consume .At the end of the project, CFE have 1,117,862 domestic users in the area and they have 589,000 potential consumers of ILUMEX at the beginning.

Distribution of users and clients
Type of User	Number/Users	Percent	Goal/Client	Percent
Small	352,279	31.5%	186,029	31.6%
Middle	575,676	51.5%	302,732	51.4%
Big	189,924	17.0%	100,239	17.0%
Total	1,117,862	100.0%	589,000	100.0%

Distribution of CFL sold
Type of User	Number/Users	Percent	Goal/Client	Percent
Small	270,377	11.0%	500,000	29.0%
Middle	771,813	32.0%	900,000	53.0%
Big	1,394,437	57.0%	300,000	18.0%
Total	2,436,627	100.0%	1,700,000	100.0%

1. Cost (to the extent possible):

Losses in low tension, 1997
	South		Northeast
Capacity	22.98%		23.97%
Energy	19.41%		17.86%

Operation life	Manufacturer	Factor	Duration
Lamps	1,000	0.75	750
CFL	10,000	0.09	9,000

Marginal Costs of LP, 1997
Pesos		South			Northeast
Capacity		1,034.990			1,015.920
Enepun		0.273			0.270
Eneint		0.232			0.226
Enebas		0.226			0.215
Factor of CO2 (kg/kWh)
Fuel oil			0.27850
Gas			0.20194
Diesel			0.26662
Price of Purchase (USD/CFL)
CFL	Admin.			Total
11.42	2.50			13.92

Real rate of annual discount
	User	CFE	Nation
1995-1998	12%	9%	8%

Tariff in current pesos ($/kWh)
Guadalajara	1995	1996	1997	1998
Basic	0.0965	0.2508	0.2903	0.3295
Intermediate	0.1543	0.2838	0.3320	0.3818
Excess	0.5273	0.8944	0.9713	1.1208
Monterrey	1995	1996	1997	1998
Basic	0.0875	0.2293	0.2472	0.3055
Intermediate	0.1445	0.2452	0.3105	0.3589
Excess	0.5273	0.8944	0.9713	1.1208
Hrs-use/year
1,118.50
8.05
1.33
No. lamps/CFL

	hrs/day	Operation life
Jalisco	3.11		7.92
Basic	3.16		7.81
Intermediate	3.22		7.66
Excess	293		8.43
Nuevo León	3.01		8.20
Basic	3.09		7.98
Intermediate	2.63		9.38
Excess	3.06		8.07

Watts by CFL sold

	1995	1996	1997	1998
Total	19.60	19.32	18.52	19.49
Basic	19.78	19.35	17.99	19.59
Intermediate	19.67	19.20	18.44	19.55
Excess	19.25	19.44	19.58	19.27
Jalisco	20.16	19.38	18.18	19.65
Basic	20.05	19.30	17.71	19.65
Intermediate	20.03	19.24	18.17	19.65
Excess	20.37	19.64	18.53	19.65
Nuevo León	18.94	19.30	20.02	19.06
Basic	19.09	19.61	20.24	19.06
Intermediate	18.67	18.93	19.61	19.06
Excess	18.97	19.33	20.07	19.06

Average Capacity savings for CFL (W/CFL-User)

	1995	1996	1997	1998	Prom. Pond.
Total	50.59	51.30	52.27	51.38	51.39
Básico	54.62	55.05	56.41	54.81
Intermedio	52.27	52.74	53.50	52.39
Excedente	49.97	49.78	49.64	49.95
Jalisco	51.38	52.38	54.04	52.57	52.59
Básico	56.42	57.17	58.76	56.82
Intermedio	52.16	52.95	54.02	52.54
Excedente	48.88	49.60	50.72	49.60
Nuevo León	50.54	50.22	49.59	50.55	50.22
Básico	59.48	58.96	58.33	59.51
Intermedio	51.62	51.23	50.68	51.23
Excedente	50.16	49.80	49.06	50.07

ILUMEX: IRR

No reposition of CFL at the end of operational life.

	Internal Rate of Return (TIR)	B/C	Discount
User	Positive	4.94	-48.77
CFE 1	-	0.80
CFE2	60.03%	2.47
CFE3	29.29%	1.55
Nation 1	48.69%	1.84
Nation	60.42%	2.46
Nation	53.75%	1.20

Millions of dollars of 1998

User	1995	1996	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	Total	VPN
CFL Earnings c/Tax	0.66	2.58	3.49	4.61	3.06	1.78	-	-	-	-	-	-	-	16.18	$ 10.70
Lamps c/Tax	0.04	0.13	0.23	0.34	0.40	0.40	0.40	0.40	0.37	0.28	0.17	0.07	0.01	3.22	$ 1.58
Invoice c/Tax	0.62	3.61	6.96	11.50	13.41	13.41	13.41	13.41	12.31	9.21	5.72	2.32	0.07	105.99	$ 51.25
Tax CFL	0.09	0.34	0.46	0.60	0.40	0.23	-	-	-	-	-	-	-	2.11	$ 1.40
Tax Lamps and Invoice	0.09	0.49	0.94	1.54	1.80	1.80	1.80	1.80	1.65	1.24	0.77	0.31	0.01	14.24	$ 6.89
Net	-0.00	1.16	3.70	7.23	10.75	12.04	13.81	13.81	12.68	9.48	5.90	2.38	0.08	93.03	$ 42.13

 

CFE	1995	1996	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	Total	VPN
CFL Purchase s/Tax	5.39	8.30	7.04	6.73	0.00	0.00	0.00	0.00	0.00	000	0.00	0,00	0.00	27.46	$ 22.14
Tax CFL	0.81	1.25	1.06	1.01	-	-	-	-		-	-	-	-	4.12	$ 3.32
Lost Invoice s/Tax	0.54	3.14	6.05	10.00	11.66	11.66	11.66	11.66	10.71	8.01	4.98	2.01	0.06	92.16	$ 52.65
CFL Earnings s/Tax	0.57	2.24	3.04	4.01	2.66	1.55	-	-	-	-	-	-	-	14.07	$ 10.25
Capacity Avoided	0.57	2.02	3.66	5.36	6.30	6.30	6.30	6.30	5.80	4.35	2.72	1.02	0.09	50.80	$ 29.27
Energy Avoided	0.45	1.60	2.92	4.28	5.03	5.03	5.03	5.03	4.62	3.45	2.15	0.78	0.06	4043	$ 23.30
Net 1	-5.15	-6.82	-4.52	-4.10	2-33	1.22 -	-0.33 -	-0.33 -	-0.29	-0.22 -	-0.11 -	-0.22	0.08	-18.45	$ 15.28
Net 2	-4.61	-3.68	1.53	5.91	14.00	12.88	11.34	11.34	10.42	7.79	4.86	1.80	0.14	73.71	$ 37.37
Net 3	-5.06	-5.28	-1.39	1.63	8.97	7.85	6.30	6.30	5.80	4.35	2.72	1.02	0.09	33.28	$ 14.06

 

Nación	1995	1996	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	Total	VPN
CFL Purchase s/Tax	5.39	8.30	7.04	6.73	-	-	-	-	-	-	-	-	-	27.46	$ 22.64
Lost Tax / Invoice	0.08	0.47	0.91	1.50	1.75	1.75	1.75	1.75	1.61	1.20	0.75	0.30	0.01	13.82	$ 8.37
Lost Tax /Lamps	0.00	0.02	0.03	0.04	0.05	0.05	0.05	0.05	0.05	0.04	0.02	0.01	0.00	0.42	$ 0.26
Bulbs Avoided s/IVA	0.03	0.11	0.20	0.30	0.35	0.35	0.35	0.35	0.32	0.24	0.15	0.06	0.00	2.80	$ 1.71
Capacity Avoided	0.57	2.02	3.66	5.36	6.30	6.30	6.30	6.30	5.80	4.35	2.72	1,02	0.09	50.80	$ 30.97
Energy Avoided	0.45	1.60	2.92	4.28	5,03	5.03	5.03	5.03	4.62	3.45	2.15	0.78	0.06	40.43	$ 24.66
Tax CFL CFE	0.81	1.25	1,06	1.01	-	-	-	-	-	-	-	-	-	4.12	$ 3.40
Tax CFL User	0.09	0.34	0.46	0.60	0.40	0.23	-	-	-	-	-	-	-	2.11	$ 1.59
Net 1	-3.60	-3.70	-0.08	2.68	9,59	9.42	9.19	9.19	8.44	6.32	3.94	1.43	0.13	52.94	$ 27.64
Net 2	-3.52	-3.22	0.82	4.18	11.34	11.17	10.94	10.94	10.05	7.52	4.69	1.73	0.14	66.77	$ 36.01
Net 3	-3.53	-3.47	0.32	3.27	10.28	10.11	9.88	9.88	9.08	6.79	4.24	1.54	0.14	58.56	$ 31.06

ECONOMIC EVALUATION FOR THE ILUMEX PROJECT

This evaluation was made general parameters given by the American consultants who develop the study for the prefeasible project.

Having subscribe the project as one of administration demand (DSM), It were consider costs and benefits for electric energy end user as for CFE and the Nation for a period, ending in the last year when it still be Compact Fluorescent Lamps (CFL) in use, that will be in 2007, having start selling in May 1995 with an assumption of no replacing them.

Between the cost and the benefits for de user, we have: the cost payment for a CFL, the savings in energy payment and savings for no buying incandescent bulbs, all with taxes.

For CFE, the costs and benefits were: the payment cost for CFL, the lost for incoming of energy without selling, avoided cost by capacity, avoided cost for energy and incoming recuperation for selling CFL with discount, that it was of 48.77% in average.

For the Nation the costs and benefits were: total cost for CFL, taxes without perceive, incandescent bulbs without selling, energy savings and the avoided capacity.

The saving of capacity and energy for CFE is evaluate starting off by the fallowing data: the consume factor using CFL (0.35), the label of lost by capacity and lost by energy in low tension, thus as the daily period time of the CFL, that is 3 hours and there appear in table of parameters shown before.

For the calculation for saving of avoided demand, one considers marginal cost for Capacity by generation in low tension ($/kWh), and for energy, it is introduced marginal cost of long term of energy in low tension for the peak period by considering the use for illumination with it and be more expensive than in the base and interval. This tow costs vary by region of generation and there exhibit in the table of parameters.

Since the prefeasible study begun, we have recommended to use data of generation of energy and from fuel plants near to zones where it would be develop the project since it beginning. The thermoelectric plants where Manzanillo and Monterrey, with efficiency of 36% and 28%, respectively; both using fuel oil and Monterrey using also gas.

The rates of discount that the evaluation use was: 12% for the user, 9% for CFE and 8% for the Nation, in real terms. These rates are different considering that costs are no the same for each economic agent of the project.

In order to have flows of numbers to constant prices, it was change to dollars using values of august 1998 that is usual in this country.

The project is efficient in costs for all the parts of the program, although the IRR in this analyzed case for CFE is not positive.

Among the parameters for the financial evaluation, we have annex a table that shows the daily use of LCF and average capacity saved for each type of client. Also it shows electric energy prices applied to evaluate savings for the user and losses for invoicing from CFE.

There were build flows of buying and selling CFL in physical terms, so there can be establishes its operation life and its correct use in time. The flows were evaluated in dollars as it was explained before. The same have been made for incandescent bulbs that there have been left acquire or use.

This way was establish in GWh a flow for energy savings by CFE and the user, making a difference for energy losses factor. The flows for the avoided demand in MW were determined for CFE and the user considering the factor of coincidence and losses of capacity.

The flows evaluated for this important saving elements in a program of Demand-Side Management (DSM), it allowed us to calculate a benefit/cost relation for the participant users or clients of ILUMEX equal to 4.8. The Internal Rate of Return was very high.

The second case analyzed for CFE, it was obtained a B/C rate of 2.5 with an internal rate of return of 60%. For the Nation, in the second case, it was obtained a B/C rate of 2.5 and an IRR of 60.4%.

In the second case of CFE, it was introduced as cost the CFL purchase with tax, and as benefits, the savings in capacity of avoidable generation and the avoidable energy, thus as the incoming obtained for the selling of CFL with tax.

In the second case of the Nation, the costs are the CFL purchase with tax lost in bulbs without selling, thus as bulbs have been left sold by the distributor of them. Among the benefits, there are the avoidable capacity of generation, the generation, and tax paid by CFE and user for the CFL.

There is a third case for CFE that it also does not consider the avoidable energy generate what they give a B/C rate of 1.6 and a IRR of 29.3%.

For more details, in the annex table are valorized flows in dollars for each concept included in this case. En the first case of CFE leaves a B/C of 0.8 and a IRR no significant.

In all the flows, the maximum values are reached between 1999 and 2002, soon to decrease until 2007. Previously, it have been constructed an operation life patron for the CFL, attending to its daily use for each user, that it was established by means of measurements of the use 96 times to the day during 15 days for each CFL acquired by 100 user in this sample, for the both periods of summer and out of it.

It have been done also a calculus for the flows of emissions avoided of CO₂, using emissions factors for fossil oil and gas used in Manzanillo and Monterrey plants, without given it a economic value. Data was obtained from the savings of energy avoided, the generation by plant, fuels used by plant, the heat values and thermal efficiencies.

In the future, it would be necessary to redefine protocols of verifications, as well as factor used.

5) Mutually agreed assessment procedures:

Describe the procedures, including name of organizations involved ) :

Projections of emissions reductions including technical parameters to be used, baseline estimation, and the plan for monitoring the hours of use of the bulbs. (See Section E below and Appendix B for details on the estimation of emissions benefits.) Surveys of participants to determine participant characteristics, perceptions and satisfaction. Market surveys administered to vendors of lamps to determine market characteristics. Organizations involved in determining the parameters and methodologies have been used include UNAM, IIEC, CFE, the World Bank and INE. In 1997, a consultant was hired to undertake a comprehensive project evaluation, including evaluation of the monitoring and emissions benefit estimation procedures and verification of results.

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

1. 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:

1. 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;
2. 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.

1. For the activity:

   * First report and joint reporting: please add copies of letters of endorsement by each designated national authority of Parties involved in the activity.

   The letter of endorsement will be sent accordingly.

2. This report is a joint report:

   This project was a joint report. The project was endorsed by the Mexican Ministry of Finance and Public Credit and the Norwegian Ministry of Foreign Affairs in an agreement signed on September 30, 1993. This report has been endorsed by the Mexican focal point for AIJ, the UCCI (Unit for International Cooperation and Conventions) within INE-SEMARNAP, and by the Norwegian Ministry of Foreign Affairs.

   ? Yes, forward copy of agreement/endorsement by the designated national authorities involved¿?

   ? No

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

The items of the report describing the project, its implementation and its effects, has completed by the Government of Mexico. The investor specific items have been completed by the Government of Norway. The World Bank, as the implementing agency, has provided assistance and advice in the preparation of the joint report.

1. 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

   Mexico has a strong environmental policy framework and has completed a national environmental action plan. As a party to the UNFCCC, Mexico is committed to formulate programs to mitigate climate change. The ILUMEX project has contributed to reductions in local and regional pollutants, which support Mexico's national pollution reduction goals, as well as greenhouse gas mitigation which supports Mexico's position under the UNFCCC. The economic benefits of the ILUMEX project have included reduction in energy consumption and consumers' energy bills and a delay in costly additions to Mexico's electricity generating capacity, without loss of service. In addition, the CFE have avoided financial losses by not selling the avoided kWh, which otherwise would be sold to residential customers at a loss. The project have build institutional capacity in Mexico for technological change and energy conservation; make consumers more aware of the importance of energy savings and how to achieve them; provided a replicable model for demand side management (DSM) throughout Mexico and other countries in the developing world; and strengthen the capacity of the CFE to practice large scale DSM and energy efficiency projects on a on-going basis.

2. 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:	See below.
   Do quantitative data exist for evaluation of environmental benefits?	Yes; see Section E and Appendix B.
   Describe social/cultural benefits in detail:	See below.
   Do quantitative data exist for evaluation of social benefits?	Participant survey data may provide a basis for this evaluation.
   Describe economic benefits in detail:	See below.
   Do quantitative data exist for evaluation of economic benefits?	Yes; see Appendix C.

   DESCRIPTION OF ENVIRONMENTAL BENEFITS

   The project's greenhouse gas emissions benefits are anticipated to last more than ten years based on the 33 month phase-in period for the sale of the 1.7 million CFLs and the conservatively estimated lifetime of eight years for a CFL in use for three hours per day. Although the expected life of a CFL is 10,000 hours, the project assumes a life of only 8,760 hours, or eight years at three hours per day.

   Estimated carbon dioxide (and other pollutant) emissions reductions of the project were based on a the fuel mix used at the generation facilities serving Monterrey and Guadalajara during 1995 and 1998. The estimated reduction in electricity demand resulting from the use of CFLs, was based on the average difference in watts between the CFLs and ordinary bulbs, the number of CFLs in use as a result of the project, and an average use of three hours per days. Total project emissions benefits over the lifetime of the CFLs sold are estimated as: 709.80*10³ metric tons carbon dioxide.

   Reductions of nitrogen oxide emissions, which have a greenhouse gas effect, have not been quantified as carbon equivalents. Reductions in the non-greenhouse gas pollutants will result in better air quality and benefits for human health, crops, vegetation and buildings. Water was conserved as a result of the generation avoided, which is especially important in Monterrey where water resources are more limited.

   DESCRIPTION OF SOCIAL/CULTURAL BENEFITS

   The project should had an impact on raising the awareness of the general public regarding energy conservation. The energy and electricity cost savings enjoyed by those enrolled in the project had encourage non-participants to buy CFLs, in addition, it have been implemented programs to substitute technologies for clean ones and more efficient, correction of the potential factor, cultural programs and others that can be implemented at the same time.

3. 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:

   The baseline assumption for the project was the continued use of ordinary light bulbs by project participants. It was assumed that, over the lifetime of project benefits, the CFE have not been initiate the ILUMEX project without the grant money and those ordinary light bulbs have not been replaced with CFLs by the project participants. These assumptions are reasonable given today's economic climate in Mexico and the high cost of the bulbs.

   The baseline condition was the use of 1.7 million ordinary (incandescent) light bulbs, instead of CFLs. The number of kWh required by the baseline condition was calculated based on the characteristics of the incandescent bulbs that the CFLs replace (e.g. average number of watts), an average of three hours of use per day, thirty days per month and the 8,760 hour life time conservatively estimated in the project feasibility study for the CFLs.

   Data on the type of bulbs replaced was collected from participants. The average number of hours of use per day was estimated at three hours, based on the preliminary results of metering studies of the CFLs in participants' homes. It was assumed that the CFLs and ordinary bulbs have been used for the same number of hours per day. project benefits were counted for the lifetime of the CFLs. Distribution and transmission losses for generated electricity on the CFE system of 18% are taken into account in the estimation of kWh used.

   The estimation of emissions per kWh was based on the fuel mix actually used at the Manzanillo plan which serves Guadalajara (fuel oil and diesel) and the Monterrey plant (fuel oil and natural gas) in 1995 and 1996; the heat rate, or efficiency, of the plants; and the standard emissions factors by fuel type. In 1997, the current methodology for estimating emissions of carbon dioxide and other gases have been assessed and revised by an outside consultant.

2. Estimated emissions with the activity:

Description of the scenario, including methodologies applied:

The emissions with the project were estimated as those resulting from the use of the 1.7 million CFLs. This was done in a manner similar to that for the estimation of emissions for the baseline scenario. The number of kWh used by the CFLs was calculated based on the technical characteristics of the bulbs (e.g. average number of watts per bulb) sold, an average of three hours of use per day and thirty days per month and the 8,760 hour life time conservatively estimated in the project feasibility study for the CFLs. Distribution and transmission losses of 18% for electricity generated on the CFE system were taken into account in the estimation of kWh used.

The average number of hours of use per day was estimated at three hours, based on the preliminary results of metering studies of the CFLs in participants' homes. The estimation of emissions per kWh was based on the fuel mix actually used at the Manzanillo plant, which serves Guadalajara and the Monterrey plant in 1995 and 1996, the heat rate of the plants and the standard emissions factors by fuel type. In 1997, an outside consultant has assessed the current methodology for estimating emissions of carbon dioxide and other gases.

Metering: During 1996, data on time and amount of use has been gathered by metering light bulbs in the homes of randomly selected samples of participants in each of the two cities for a period of up to two weeks for each sample. In 1997, metering of additional households was carried out using the same methodology. The preliminary results of this metering, taken during summer and winter, showed that the average number of hours of use per day of the CFLs was about 3 hours, and that the average energy savings per lamp replaced was 50W, with a coincidence factor of 0.50. The feasibility study carried out in 1992 established 4 hours of use per day, 54W saved by lamp and a coincidence factor of 0.82.

Snapback effect: In the long run, project participants who face a lower cost of electricity service may, as a consequence, burn the bulbs longer. This "snapback" effect could result in an overestimation of project benefits. In the methodology used to estimate project benefits, this effect was not taken into account. There were two reasons why this, effect might be nominal or non-existent, especially in the early part of the project. Residential electricity rates were increasing by an average of 1.2% per month. This had partially offset the reduced cost of electricity service associated with the new bulbs. For those who buy the bulbs on credit (the majority of the participants on terms ranging from 6 to 24 months), the payments for the bulbs were often been greater than the electricity cost savings.

CO₂ equivalent: To determine the number of tons of CO₂ equivalent, emissions of methane were converted using global warming potential factor of 21 taken from the 1996 report of the Intergovernmental Panel on Climate Change.

Leakage: No additional emissions, outside the project boundaries, had been expected to occur as a result of the project. The project has encouraged or influences the purchase or use of CFLs by non- project participants.

The CFE have used money received from the sale of light bulbs to expand the program of subsidized CFL sales to other customers. However, none of these emissions benefits will be claimed for the project.

Other Monitoring : Monitoring was been the responsibility of the Implementing Units with supervision from the Project Coordination at CFE. A baseline sales survey prior to the project's initiation and another sales survey at the end of the project have been used to determine if the project has influenced the sales of CFLs to non-project participants.

Assumptions Used in Calculating Emissions Reductions: See Appendix B for assumptions used in the emissions reductions estimates.

I L U M E X : A BASELINE				CFE	September, 99
			Savings
Year	CFLs sales	CFLs installed	Capacity MW	Energy GWh	CO2 ton *103
Total	1,760,000	1,760,000	100	1,014	709.80
94	880,000	440,000	25	42	29.40
95	880,000	1,320,000	75	127	88.90
96		1,760,000	100	169	118.30
97		1,760,000	100	169	118.30
98		1,760,000	100	169	118.30
99		1,760,000	100	169	118.30
00		1,320,000	75	127	88.90
01		440,000	25	42	29.40

• In 1994, half of 880000 CFLs were installed.

  In 1995, 880000 CFLs were installed

  In 1996 all the 1,760,000 that were sold in previous years were installed

  In 2000 about 1/4 of the installed lamps had faded away.

  Source: CFE

1. 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 Including pre-feasibility phase (For each source one line)	Amount (US dollars)
   Government of Norway	$3,000,000
   Federal Electricity Commission of Mexico (CFE)	$10,000,000
   Global Environmental Facility (GEF)	$10,000,000

   The Norwegian co financing was provided in addition to the Norwegian contribution to the GEF in 1993. The availability of extra Norwegian co financing served to expand the project scope beyond what would have been undertaken in the absence of this funding. Specifically, the Norwegian resources resulted in an increase in the number of bulb replacements by approximately 200,000 bulbs. The purpose of the Norwegian grant is to facilitate a demonstration project and the Norwegian government is not seeking emissions credits from its investment in this project.

2. 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

Describe briefly the transfer of environmenally sound technology and know-how including where appropriate the type of technology, terms, education, capactity building etc.

The project will enhance the capacity of the CFE to implement large scale DSM projects, including additional high efficiency light bulb distribution projects in other parts of Mexico. Valuable experience have been gained from the successful marketing operations of the ILUMEX project as well as from the monitoring of emissions benefits and the participant and market surveys.

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

Fill in as appropriate:

1. Any practical experience gained:
2. Technical difficulties:
3. negative impacts and/or effects encountered:

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 negative impacts/effects in detail: Do quantitative data exist for evaluation of environmental negative impacts/effects?	Yes/no
Describe social/cultural negative impacts/effects in detail: Do quantitative data exist for evaluation of social negative impacts/effects?	Yes/no
Describe economic negative impacts/effects in detail: Do quantitative data exist for evaluation of economic negative impacts/effects?	Yes/no

4. Other obstacles encountered:
5. Other:

APPENDIX A

SELECTED REPORTS AND STUDIES RELATED TO THE ILUMEX PROJECT

Feasibility Study and Program Menu for the ILUMEX project. Prepared by the International Institute for Energy Conservation. December 1992.

Executive Summary of the ILUMEX Project and Technical Annex prepared by the CFE. August 1993.

Global Environmental Facility Project Document, United Mexican States and Banco Nacional de Obras y Servicios Publicos High Efficiency Lighting Project. March 1994

Reports on baseline marketing surveys to determine characteristics of residential market for high efficiency light bulbs. Results of surveys of compact fluorescent light bulb vendors in Guadalajara (December 1994) and Monterrey (March 1995). Prepared for the CFE.

Report on surveys of participants one year after the beginning of the project. The surveys were conducted to collect data on the participants' use of the bulbs and determine their perceptions of the program. Monterrey (February 1996) and Guadalajara (April 1996). Prepared for the CFE.

Report on the technical performance of the compact bulbs. Prepared for the CFE, June 1996.

Results of metering of light bulbs in participants' homes to estimate the number of hours per day and time of day used. Metering was conducted in Monterrey in July and August 1996 and in Guadalajara in September 1996. Prepared for the CFE.

Report to the Second Meeting of the Conference of the Parties to the United Nations Framework Convention on Climate Change on a Mexico High Efficiency Lighting Project. Submitted by the governments of Norway and Mexico. October 18, 1996.

APPENDIX B:

DATA AND METHODOLOGY USED TO ESTIMATE EMISSIONS BENEFITS

The emissions reductions of the project are estimated as follows:

1. The kilowatt hours of electricity not generated as a result of the replacement of 1.7 million incandescent bulbs with CFLs are estimated. This is based on the following parameter values:

Number and type of bulbs installed by month

An average bulb use of three hours per day (based on preliminary results of on-site metering of bulb use in participants' homes.) and 30 days per month.

A bulb lifetime of 8,760 hours (12.4% less than the technical specifications of the compact fluorescent lights (CFLs)).

An average savings of 50 watts per bulb (the difference between the average incandescent bulb wattage and the average wattage of the CFLs used as replacements).

Transmission and other losses of 18% on the CFE system.

2. The kilowatt hours not generated are converted to emissions saved using:

Standard emissions factors given by Programa Universitario de Energía, UNAM except CH₄ given by INE for each fuel type, expressed in tons per Tera Joule (see below).

Fuel mix actually used at the Monterrey and Manzanillo plants in 1995 and 1996.

The heat rate, or efficiency, of the plants.

Actual emissions reductions achieved and projections of future environmental benefits may be re-estimated again, following a project evaluation to be carried out this year including an assessment of monitoring and emissions estimation procedures.

Average Plant Efficiency: Monterrey: 28.61%; Manzanillo 38.01%.

PROJECT FINANCIAL EVALUATION
(All monetary values are expressed in millions of 1993 US dollars)
PROJECT OVERVIEW
Number of Households	1'116'851
Total number of CFLs	1'767'000
Avoided capacity (MW)	100
Avoided Energy (GWh/year)	169
CFE
Project Costs	22.97
Lost Income from Unsold Energy	28.52
Total Costs	51.49
Value of Avoided capacity	53.98
Value of Avoided Electricity Generation	44.4
Revenues from Sale of CFLs	12.3
Total Benefits	110.67
Net Benefits	59.19
Benefits/Costs	2.15
CONSUMERS
Cost of Acquiring CFLs	12.9
Benefits from Energy Savings	26.85
Benefits from not Buying Incandescent Bulbs	2.82
Total Benefits	29.68
Net Benefits	16.77
Benefits/Costs	2.3
NOTE: These calculations were made by the IIEC, assuming an average use of the CFLs of 4 hours per day and an average bulb life of 6 years. Elsewhere in the project report, these assumptions have been modified to an average use of 3 hours per day and a lifetime of 8 years. When monitoring activities are completed and the estimate of hours of usage per day is verified, the financial evaluation of the project will be re-calculated. It should be noted that the total kilowatt hours saved remains the same regardless of the average number of hours per day of use.
These estimates still represent a reasonable approximation of project financial benefits. Discount rates used were 12% for CFE and 18% for the customer perspective. The long term marginal cost of electricity generation is assumed to be US$.062/kwh. Average wattage saved per bulb is estimated at 50.4.

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

FCCC/CP/1995/7/Add.1

English

Page 18

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 cooperation 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,

1. 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,
2. Activities implemented jointly between Annex I Parties and non-Annex I Parties will not be seen as fulfillment 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 fulfillment of commitments of Annex II Parties under Article 4.5 of the Convention,
3. Activities implemented jointly under the Convention are supplemental, and should only be treated as a subsidiary means of achieving the objective of the Convention,
4. Activities implemented jointly in no way modify the commitments of each Party under the Convention,

1. Decides:
2. 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;
3. 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;
4. 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;
5. That activities implemented jointly should 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;
6. That the financing of activities implemented jointly shall be additional to the 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 (ODA) flows;
7. That no credits shall accrue to any Party as a result of greenhouse gas emissions reduced or sequestered during the pilot phase from activities implemented jointly;

1. Further decides that during the pilot phase:

1. The Subsidiary Body for Scientific and Technological Advice will, in coordination with the Subsidiary Body for Implementation, establish a framework for reporting, in a transparent, well-defined and credible fashion, on the possible global benefits and the national economic, social and environmental impacts as well as any practical experience gained or technical difficulties encountered in activities implemented jointly under the pilot phase;
2. The Parties involved are encouraged to report to the Conference of the Parties through the secretariat using the framework thus established. This reporting shall be distinct from the national communications of Parties;
3. The Subsidiary Body for Scientific and Technological Advice and the Subsidiary Body for Implementation, with the assistance of the secretariat are requested to prepare a synthesis report for consideration by the Conference of the Parties,
4. FCCC/CP/1995/7/Add.1

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Page 20

1. Further decides:

1. That the Conference of the Parties shall, at its annual session, review the progress of the pilot phase on the basis of the synthesis report with a view to taking appropriate decisions on the continuation of the pilot phase;
2. In so doing, the Conference of the Parties shall take into consideration the need for a comprehensive review of the pilot phase in order to take a conclusive decision on the pilot phase and the progression beyond that, no later than the end of the present decade.

10th plenary meeting

7 April 1995

Annex II EXTRACT FROM: FCCC/CP/1996/15/Add.1:

Report of the Conference of the Parties on its second session, held at Geneva from 8 to 19 July 1996, Part two: Action taken by the Conference of the Parties at its second session

FCCC/CP/1996/15/Add.1

English

Page 14

Decision 8/CP.2

Activities implemented jointly under t he pilot phase

The Conference of the Parties,

Reaffirming its decision 5/CP.1 on activities implemented jointly, whereby the Conference of the Parties is to review the progress of the pilot phase with a view to taking appropriate decisions on its continuation,

1. Takes note of the progress report on activities implemented jointly (FCCC/CP/1996/14 and Add.1);
2. Decides to continue the pilot phase;
3. Invites Parties to report in accordance with the initial reporting framework adopted by the Subsidiary Body for Scientific and Technological Advice at its second session (FCCC/SBSTA/1996/8, annex IV);
4. Requests the secretariat to support the work on issues relating to activities implemented jointly as agreed by the Subsidiary Body for Implementation and the Subsidiary Body for Scientific and Technological Advice.

8th plenary meeting

19 July 1996

N:PatrickkILUMEX UPDATE -unfcc 2001.doc

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