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ACTIVITIES IMPLEMENTED JOINTLY(AIJ)

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.

Report Submitted for Approval by the Belgian and Croatian National Authorities on Activities Implemented Jointly A. Desription of the Project

1) Title of the Project

CO₂ recovery in a Brewery in Zagreb

2) Participants/Actors

There are six parties involved in the project: two private companies (Interbrew from Belgium and Zagrebacka Pivovara from Croatia) which have a deal on implementation of a technical project, a research institute (VITO from Belgium) for the development, assessment and follow up of the AIJ part of the project, the Ministry of the Flemish Community, department Economy (Belgium) that provides funding for the AIJ part and the National Authorities for AIJ from both Belgium and Croatia.

Item
Name of organization	Interbrew
Name of organization (English)	Interbrew
Department
Acronym
Acronym (English)
Function within activity	Donor company
Street	Vaartstraat 94
Post code	B-3000
City	Leuven
Country	Belgium
Telephone	+ 32 (0)16 24 71 11
Fax	+ 32 (0)16 24 74 07
E-mail
WWW-URL
Contact person (for this activity)	Mr. Mr.
Surname	Timmers van Hencxthoven
First name, middle name	Geerd Jan William
Job title	Environmental Manager International Technical Assistance
Direct tel.	+32 (0)16 24 70 49 +32 (0)16 24 79 50
Direct fax.	+32 (0)16 24 77 07 +32 (0)16 24 78 85
direct E-mail

Item
Name of organization	Zagrebacka Pivovara
Name of organization (English)	Zagrebacka Pivovara
Department	Energy & Fluids
Acronym
Acronym (English)
Function within activity	Host company
Street	Ilcia 224
Post code	1000
City	Zagreb
Country	Croatia
Telephone	+ 385 1 180 901
Fax	+ 385 1 174 639
E-mail
WWW-URL
Contact person (for this activity)	Mr.
Surname	Josse
First name, middle name	Denis
Job title	Technical Director
Direct tel.	+385/1.180.901
Direct fax.	+385/1.174.639
direct E-mail

Item
Name of organization	Vlaamse Instelling voor Technologisch Onderzoek
Name of organization (English)	Flemish Institute for Technological Research
Department	Product and Process Assessment
Acronym	VITO
Acronym (English)
Function within activity	Developing and funding of AIJ aspect of the project
Street	Boeretang 200
Post code	B-2400
City	Mol
Country	Belgium
Telephone	+ 32 (0)14 33 55 11
Fax	+ 32 (0)14 33 55 99
E-mail
WWW-URL	http://www.vito.be
Contact person (for this activity)	Mr.
Surname	Peeters
First name, middle name	Frank
Job title	Project leader
Direct tel.	+ 32 (0)14 33 58 19
Direct fax.	+ 32 (0)14 32 11 85
direct E-mail	peetersf@vito.be

Item
Name of organization	Ministerie van de Vlaamse Gemeenschap, departement Economie
Name of organization (English)	Ministry of the Flemish Community, department Economy
Department	Natural Resources and Energy
Acronym	ANRE
Acronym (English)
Function within activity	Funding of AIJ aspect of the project
Street	Markiesstraat 1
Post code	B-1000
City	Brussels
Country	Belgium
Telephone	+ 32 (0)2 507 39 53
Fax	+ 32 (0)2 507 44 38
E-mail
WWW-URL
Contact person (for this activity)	Mr.
Surname	Vansteelandt
First name, middle name	Paul
Job title	Head of Division
Direct tel.	+ 32 (0)2 507 39 10
Direct fax.
Direct E-mail

Item
Name of organization	Ministerie van Economische Zaken
Name of organization (English)	Ministry of Economical Affairs
Department	Administration Energy
Acronym	ENOVER/CONCERE
Acronym (English)
Function within activity	National Authority for AIJ in Belgium
Street	North Gate III – Bd. E. Jacqmain 154
Post code	B-1000
City	Brussel
Country	Belgium
Telephone	+32-2-206 45 06
Fax	+32-2-206 57 30
E-mail
WWW-URL
Contact person (for this activity)	Ms.
Surname	Meuleman
First name, middle name	Lizi
Job title
Direct tel.	+32-2-206 45 06
Direct fax.	+32-2-206 57 30
Direct E-mail

Item
Name of organization	Drzavna uprava za zastitu okolisa
Name of organization (English)	State Directorate for Environment
Department	Air Department
Acronym	DUZO
Acronym (English)
Function within activity	National Authority for AIJ in Croatia
Street	Ulica grada Vukovara 78
Post code	HR-10000
City	Zagreb
Country	Croatia
Telephone	+ 385 1 6133 444
Fax	+ 385 1 537 203
E-mail	duzo@ring.net
WWW-URL
Contact person (for this activity)	Mr.
Surname	Necak
First name, middle name	Jasenka
Job title	Head of the Air Department
Direct tel.	+ 385 1 6133 444
Direct fax.	+ 385 1 537 203
Direct E-mail	jasenka.neca@duzo.tel.hr

3) Activity

Item
General description	Carbon dioxide produced during the fermentation process of beer is captured, cleaned and re-used downstream the beer production process. External production (from fuel!) or purchase of carbon dioxide is avoided and carbon dioxide emissions are reduced by 51% or 3350 ton CO₂/year.
Type of project	Fugitive gas capture from an industrial process
Location	Zagreb, Croatia
Activity starting date	September 1997
Expected activity ending date	September 2012
Stage of activity	in progress
Lifetime of activity	15 years (technical lifetime)
Technical data	Baseline New Beer production in million hl/year 1.2 1.2 Purchased CO₂ in ton/year 3000 250 Sold CO₂ in ton/year - 600 Carbonation of the beer in g/l 5 5 CO₂ production in fermentor in kg/hl 3.7 3.7 CO₂ emission in atmosphere ton/year 6840 3490 Total avoided emission of CO₂ over project life-time: 50250 ton

4) Cost

Item	Year 0	Year 1	Year 2	Year 3	Year 4	Year 5	Year 6	Year 7
Cost of project (US$)	746000,-	-262000,-	-262000,-	-262000,-	-262000,-	-262000,-	-262000,-	-262000,-
AIJ component (US$)		41000,-	-	-	-	-	-	-
Cost per ton CO₂ (US$)		-66,-	-78,-	-78,-	-78,-	-78,-	-78,-	-78,-

Item	Year 8	Year 9	Year 10	Year 11	Year 12	Year 13	Year 14	Year 15
Cost of project (US$)	-262000,-	-262000,-	-262000,-	-253000,-	-253000,-	-253000,-	-253000,-	-253000,-
AIJ component (US$)	-	-	-	-	-	-	-	-
Cost per ton CO₂ (US$)	-78,-	-78,-	-78,-	-75,-	-75,-	-75,-	-75,-	-75,-

As mentioned before, the project is economically viable without subsidies from the AIJ part. Therefore, there is not a cost but a financial benefit from reducing carbon dioxide emissions. The benefit is calculated by taking into account the investment (746000,- US$), the avoided cost for external production of carbon dioxide (457000,- US$/year), the variable cost and the depreciation of the recuperation equipment (184000,- US$/year). The technique used for carbon dioxide recuperation from beer fermentation is standard practice in modern breweries in industrialised countries but is not yet wide spread in breweries in Eastern Europe and in Developing Countries.

5) Mutually agreed assessment procedures

Agreement between the Belgian and Croatian company was found on an economical basis. VITO assessed the project for compliance with the AIJ criteria as pointed out by the Conference of the Parties.

B. Governmental Acceptance, Approval or Endorsement

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

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;
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.

2) For a joint report

VITO takes the responsibilty for the follow up and the reporting of the AIJ project. Therefore, VITO suggests the Belgian and Croatian Government to forward a copy of agreement/endorsement of this project as an AIJ project to VITO, which will send one joint project report to the CoP Secretariat and a copy to the respective governments. VITO will include all comments made by the Belgian and Croation Government.

3) Comment by the government

The report entitled "CO2 recovery in a Brewery in Zagreb", which was presented to the Belgian Government for approval, contains a proposal for a project of "Activities Implemented Jointly".

The report, in its presentation as well as in its contents, meets the criteria applicable to AIJ projects under the Pilot Phase of Joint Implementation.

One might regret, however, that the report does not provide a quantified assessment of the given opportunities for a more extended application of the technology in other CEESs.

Contrary to the environmental benefit of the project, the energetic benefit is not specified.

C. Compatibility with National Development 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.

Croatia:

Republic of Croatia ratified United Nations Framework Convention on Climate Change on 7 January 1996, and it eneterd into force on 7 July 1996.

In accordance with Articles 3 and 4 of the Convention, the Republic of Croatia wants to take an active part in achieving the objective of the Convention and implement its provisions through the co-operation with other interested parties.

Belgium:

In 1991 the Belgian government decided on a national objective for the reduction of GHG emissions. GHG emissions should be reduced by 5% by the year 2000.

A National Programme for the Reduction of GHG Emissions and similar regional programmes were elaborated.

As the year 2000 approaches, most of the measures of the programme have been put into practise. Their impact will become more visual in the longer term.

However, partly due to economic growth, the objective will most likely not be met.

New measures and approaches will have to be sought.

A promising tool may be Joint Implementation. Its advantages are multiple and not only of an environmental nature.

Joint Implementation and Activities Implemented Jointly will open new markets for the Belgian industrial world and new opportunities for technology transfer and international co-operation.

The project, defined in the report, consists in the recuperation of carbon dioxide from the fermentation process and its reuse in the brewing process. In doing so, emissions would be reduced by 3350 ton/year.

The return on investment is attractive and is calculated from the avoided costs of the purchase of CO2.

The technology is well known in Belgium and its transfer to other breweries in the CEECs may create new export possibilities for Belgian companies.

D. Benefits Derived from the AIJ Project

Item
Describe environmental benefits in detail	51% CO₂ emission reduction zero ethanol emission
Do quantitative data exist for evaluation of environmental benefits?	yes
Describe social/cultural benefits in detail	Know-how and reflex to apply environmentally sound technology
Do quantitative data exist for evaluation of social benefits?	no
Describe economic benefits in detail	Annual net profit of 262000,- US$
Do quantitative data exist for evaluation of economic benefits?	yes

E. Calculation of the Contribution of the Activities Implemented Jointly Project

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

The project baseline emissions amount up to: 6840 ton CO₂/year

2) Estimated emissions with the activity

The emissions after realisation of the project are: 3490 ton CO₂/year

Projected and Actual Emissions Reduction (in tons per year):

	GHG	Year 1	Year 2	Year 3	Year 4	Year 5	Year 6	Year 7	Year 8
A) Project Baseline Scenario	CO₂
	CH₄
	N₂O
	Other
A) Project Activity Scenario	CO₂	3350	3350	3350	3350	3350	3350	3350	3350
	CH₄
	N₂O
	Other
C) Effect (B-A)	CO₂	3350	3350	3350	3350	3350	3350	3350	3350
	CH₄
	N₂O
	Other
D) Cumulative effect	CO₂	3350	6700	10050	13400	16750	20100	23450	26800
	CH₄
	N₂O
	Other

	GHG	Year 9	Year 10	Year 11	Year 12	Year 13	Year 14	Year 15
A) Project Baseline Scenario	CO₂
	CH₄
	N₂O
	Other
A) Project Activity Scenario	CO₂	3350	3350	3350	3350	3350	3350	3350
	CH₄
	N₂O
	Other
C) Effect (B-A)	CO₂	3350	3350	3350	3350	3350	3350	3350
	CH₄
	N₂O
	Other
D) Cumulative effect	CO₂	30150	33500	36850	40200	43550	46900	50250
	CH₄
	N₂O
	Other

F. Funding Sources of the Project

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, the project funding sources are:

Source of project funding	Amount (US$)
Interbrew	746000,-
Flemish Government (ANRE)	32000,-
Flemish Institute for Technological Research (VITO)	14000,-

G. Contribution of the Project to Technology Transfer and Capacity Building

Description of the 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.

In this project, there is no effective capacity building since the capacity was already installed. The project improves the quality and the production cost of the beer by transferring Western know-how and environmentally sound technology to the host country. The project will enhance the competitiveness of the local brewery.

H. Additional Comments

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

Any practical experience gained

The introduction of this first project has fostered discussions on JI on a regional and national level. A 'national focal point' has been appointed.

The project and its 'lessons learned' will be thoroughly assessed and put to good use in futur projects.

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 quantative information is too large, the source could be indicated.)

Item
Describe environmental negative impacts/effects in detail	none
Do quantitative data exist for evaluation of environmental negative impacts/effects?	no
Describe social/cultural negative impacts/effects in detail	none
Do quantitative data exist for evaluation of social negative impacts/effects?	no
Describe economic negative impacts/effects in detail	none
Do quantitative data exist for evaluation of economic negative impacts/effects?	no

4) Other obstacles encountered

5) Other

Annex General Description

1. Introduction

One of the outcomes of the UN Framework Convention on Climate Change is the introduction of new, economically driven mechanisms -such as Joint Implementation- to reduce world-wide emissions of greenhouse gases. The Conference of the Parties (the supreme body of the Convention that is entrusted with reviewing and promoting the implementation of the Convention) decided at its first session in 1995 to establish a Pilot Phase for Activities Implemented Jointly until 2000, for which criteria, principles and a uniform reporting framework have been defined.

This document contains a proposal for an Activities Implemented Jointly Project under the Pilot Phase between a Belgian and a Croatian Brewery, titled "CO₂ recovery in a Brewery in Zagreb" and is meant to obtain approval from both the Belgian and Croatian Government to report this project as an Activities Implemented Jointly project. The format of this document is based on the "Uniform Reporting Format for Activities Implemented Jointly under the Pilot Phase" as established by the Subsidiary Body for Scientific and Technological Advice at its fifth session in Bonn, February 1997.

The technical and economical part of the project has been conceived by Interbrew (Belgium) and Zagrebacka Pivovara (Croatia), whilst the Activity Implemented Jointly aspect has been developed by the Flemish Institute for Technological Research (Belgium). The project itself is economically viable (a so called "no regret project" in terms of Joint implementation), but also environmentally beneficial with respect to Climate Change. The project responds to the international criteria of Activities Implemented Jointly projects and must be situated in the field of technologically based Activities Implemented Jointly. The financial additionallity can be found in the study and development of the Activity Implemented Jointly aspect of this project (through funding by the Flemish Government and the Flemish Institute for Technological Research) and of which the main goal is to gain experience with Joint Implementation and its institutional implications. At the end of the project, the findings will be reported to the Belgian and Croatian Government and to the United Nations Framework Convention on Climate Change Conference of the Parties Secretariat.

2. Motivation for the Project

During the fermentation step of the brewing process, about 3.7 kg CO₂/hl beer is produced and emitted to the atmosphere (see figure 1). Furthermore, 2.5 kg CO₂/hl beer is purchased and used downstream the beer production process and of which 0.5 kg CO₂/hl beer is dissolved in the beer itself and 2.0 kg CO₂/hl beer is emitted again. With a production of 1.2 million hectolitres of beer in the Zagrebacka Pivovara brewery in Zagreb, the total emission of carbon dioxide amounts up to 6840 tons per year.

Figure 1: Schematic presentation of the brewing process indicating the quantitative data for emission calculations of greenhouse gases

In modern breweries in Western Europe, recuperation of carbon dioxide from the fermentation process and reuse of it downstream the brewing process has become standard practice (figure 2). Around 80% of the produced carbon dioxide can be recovered in a recuperation plant, of which 83% is reused in the brewing process and 17% is sold to third parties. Application of this technique at the brewery in Zagreb would imply an emission reduction of 3350 ton CO₂/year or 51%.

Figure 2: Principle scheme of CO₂ recuperation and reuse in a brewing process

With a pay back of less than three years, the driving force behind this technique is the financial benefit. But there are other benefits: improved quality of the beer in full control of the brewery itself, a better carbon dioxide delivery schedule and independence of market price for carbon dioxide (which will increase anyhow since it is related to the energy price). The technology transfer involved with this project not only reduces emissions, it also improves the competitiveness of the Croatian brewery. Although this project would be viable without Joint Implementation, the existence of the latter could be an incentive for Western companies (e.g. breweries) to more actively disseminate such technology.