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ACTIVITIES IMPLEMENTED JOINTLY(AIJ)

List of Projects

Uniform Reporting Format:

Activities Implemented Jointly Under the Pilot Phase

A. Description of project

1) Title of project: Combined fuel conversion and distribution renovation project

in Kuressaare, Estonia

2) Participants/actors:

Item

Financier/Reporter

Estonian co-reporter

Name of organisation(a):

Statens Energimyndighet

Eesti Vabariigi Keskkonnaministeerium

Name of organisation (English):

Swedish National Energy Administration(*

Ministry of the Environment of the Republic of Estonia

Department:

Secretariat for Climate Policy and International Co-operation

International Relations Department

Acronym:

STEM

EKM

Acronym (English):

STEM

MoE

Function within activity:

Assigned by the Swedish Government for implementation including financing arrangements.

Estonian Climate responsible Organisation

Street:

Kungsgatan 43

Toompuiestee 24

Post code:

BOX 310, S-631 04

10149

City:

Eskilstuna

Tallinn

Country:

Sweden

Estonia

Telephone:

+46 16 544 20 00

Fax:

+46 16 544 22 64

E-mail:

klas.tennberg@stem.se

WWW-URL:

http://www.stem.se

Contact person (for this activity):

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

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

Surname:

Knutsson

Kratovits

First name, middle name:

Gudrun

Andres

Job title:

Senior officer

Counsellor

Direct tel:

+46 16 544 20 72

+372 62 62 841

Direct fax:

+46 16 544 22 64

+372 62 62 845

Direct E-mail:

gudrun.knutsson@stem.se

andres@ekm.envir.ee

(* From 1 January, 1998, the new Swedish National Energy Administration has taken over the responsibility for the Programme for an Environmentally Adapted Energy System in the Baltic region and Eastern Europe (EAES Programme) from NUTEK (Swedish National Board for Industrial and Technical Development).

Borrower

Name of organisation(a):

AS Kuressare Soojus

Name of organisation (English):

Kuresssare Soojus Ltd

Department:

Acronym:

Acronym (English):

Function within activity:

Borrower

Street:

Kalevi 1a

Post code:

93815

City:

Kuressaare

Country:

Estonia

Telephone:

+372-45-31 260

Fax:

+372-45-31 265

E-mail:

ksoojus@tt.ee

WWW-URL:

Contact person (for this activity):

Surname:

Mehik

First name, middle name:

Jaan

Job title:

Technical director

Direct tel:

+372-45-312 61

Direct fax:

+372-45-31 265

Direct E-mail:

Item

Please fill in if applicable

Please fill in if applicable

Name of organisation(a):

Võru Regionaalne Energiakeskus

Name of organisation (English):

Regional Energy Centres in Estonia

Võru Regional Energy Centre

ÅF International AB

Department:

Acronym:

Võru REK

Acronym (English):

Võru REC

Function within activity:

Local reporter

Technical support

Street:

Liiva 12C

Stensjögatan 3

Post code:

65602, Võru P.O., BOX 43

S-217 65

City:

Võru

MALMÖ

Country:

ESTONIA

SWEDEN

Telephone:

+372 78 201 45

+46-40-37 50 00

Fax:

+372 78 201 45

+46-40-13 03 69

E-mail:

energikonsult@ens.af.se

WWW-URL:

http://www.af.se/ens/english/rec

http://www.af.se

Contact person (for this activity):

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

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

Surname:

Potter

Mårtensson

First name, middle name:

Elmu

Roland

Job title:

Consultant

Project leader

Direct tel:

+372 78 201 45

+46-40-37 51 04

Direct fax:

+372 78 201 45

+46-40-13 03 69

Direct E-mail:

elmu@regen.werro.ee

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:

Kuressare town is the administrative and economic centre of the biggest Estonian island Saaremaa (Ösel). Saaremaa is an attractive area for tourists. A wood fuel fired boiler has been installed in the main boiler house in Kuressaare town.

The equipment consists of, fuel storage, fuel conveyors, pre-furnace, flue gas cleaning equipment, boiler and ash handling system.

The project also includes automation and rebuilding of two DE 16-14 boilers in boiler house no 4, as well as partly rebuilding of the network. PC software are all delivered by Estonian companies

Type of project:a)

System project

Location (exact, e.g. city, region,

state):

Kuressaare town

Saare county

Estonia

Activity starting date:

6 March 1997 ( Letter of Intent)

In operation from:

March 1998

Expected activity ending date:

Loan expire date 31 March 2007

Stage of activity:b)

Completed

Lifetime of activity if different from ending date:c)

Expected technical lifetime is 25 years which means that the plant is expected to be in operation till 2023.

Technical data:d)

Boiler type: Hot water boiler

Boiler output : 5,0 MW

Prefurnace: Free standing

Flue gas cleaning: Multicyclone < 300 mg/Nm3

Fuel type: Wood chips, sawdust, bark 35-55 % RH

Previous fuel: Mazut (High-sulphur-heavy oil)

Estimated heat production from wood fuel boiler: 34000 MWh/year

Energy saving through energy efficiency: 1900 MWH

Total heat production of the boiler plant: 65000 MWh/year

The life time criteria has been arranged in different groups depending on type of implemented activities. This classification assumes a level of operation and maintenance which is normal

in western countries.

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.

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

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) 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 –Costs for seminars, handbooks, education (capacity building) and 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

Kuressaare (BC)

1998

0

Investment

1. Loan/debt to STEM

825625

2. Added costs

61875

3.Technical assistance

112500

AIJ/JI

4. Follow up

0

A. Sweden

costs

5. Reporting costs

2500

6. Administration

38500

7. Difference in interest

4%

8.Accum. costs for AIJ/JI

153500

9.Total costs

1041000

Investment

1. Investment/Instalment

0

2. Estonia

AIJ/JI

2. Reporting costs

0

costs

3. Other costs

0

4. Accum. costs for AIJ/JI

0

5. Total costs

0

1 USD=

8

SEK

5) Mutually agreed assessment procedures:

Describe the procedures, including name of organisations involveda):

Ministry of the Environment of Estonia is a central Estonian authority responsible on reporting of JI projects. This authority assigns a local institution, which is involved in to the evaluation of the climate effects of this project and takes the main responsibility to continue measuring, results collecting for JI-reporting.

a) Please ensure that detailed contact information for all organisations 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 Part 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 Parts. Information will only be compiled once reports have been received from all participating Parties.

1) For the activity:

  • * Subsequent reports:

First report

2) This report is a joint report:

  • Yes, Endorsement letter was submitted 1997.

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

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 the following objectives in the Estonian Energy Law and the Long-term Development Plan for the Estonian Fuel and Energy Sector:

- efficient use of energy resources;

- to increase the share of renewable energy sources in the primary energy demand from present 8% to 13% to the year 2010;

- to reduce the environmental damage arising from fuel and energy production, transport, conversion and distribution;

- to create the reliable energy conservation system stimulating the implementation of energy conservation measures by consumers;

- creation and usage of energy efficient technologies, fuel/energy consuming and diagnostic equipment.

- to develop co-operation between Baltic, Nordic and 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 emission reduction:

Projected: 1998

12079 ton CO2 7145 ton CO2

184 ton SO2 109 ton SO2

4 tons NOx 2 tons NOx

Lower pollution in district

Do quantitative data exist for evaluation of environmental benefits?

Yes, Tallinn Technical University have made environmental measurements in spring 1998. Report available

Describe social/cultural benefits in detail:

More stable energy supply.

Improved working conditions, increased motivation

More employment (local fuel companies)

Improved trade balance in the island

Do quantitative data exist for evaluation of social benefits?

No

Describe economic benefits in detail:

There will be less import of heavy oil, to a cost of about 320.000 Usd/year. The total savings are 170.000 Usd/year. All the wood fuel is bought local to a cost of 225.000 Usd/year.

Do quantitative data exist for evaluation of economic benefits?

Yes

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. Calculations, according to the top-down method, for emissions from different types of projects in the baseline case are being made. The changed calculation method 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 an 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 reduction s:

GHG

Year 0

=1997

Year 1

=1998

Year 2

=1999

...

Year 25

Planned energy production on biofuels, MWh/year

 

27000

 

34000

 

 

34000
Planned saving from project, MWh/year 1900 1900 1900 1900

A) Project baseline scenario

CO2

639

9724

12079

12079

CH4

N2O

other

B) Project activity scenarioa)

CO2

0

0

0

0

CH4

N2O

other

C) Effect ( B-A )

CO2

-639

-9724

-12079

-12079

CH4

N2O

Other

D) Cumulative effect

CO2

-639

-10363

-22443

-300267

CH4

N2O

Other

  1. Includes indirect GHG leakages.

Summary table: Actual emission reductions :

GHG

Year 0

= 1997

Year 1

= 1998

Year 2

=1999

...

Year 25

Factual energy production on biofuels, MWh/year

Factual saving from project, MWh/year

0

1500

19534

1700

19534

1700

19534

1700

A) Project baseline scenario

CO2

505

7145

7145

7145

CH4

N2O

other

B) Project activity scenarioa)

CO2

0

0

0

0

CH4

N2O

other

C) Effect ( B-A )

CO2

-505

-7145

-7145

-7145

CH4

N2O

Other

D) Cumulative effect

CO2

-505

-7649

-21939

-179121

CH4

N2O

Other

a) Includes indirect GHG leakages.

F. Additionality 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

946660

Grant from NUTEK for technical assistance

100000

1 USD = 7.50 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 SNEA’s technical specialist during the implementation of the project.

ii) Technology transfer through co-operation between foreign supplier and local partner

iii) Conferences, seminars, documentation and training.

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

Technology transfer has taken place through:

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

Knowledge in negotiations to foreign companies;

Knowledge in managing and planning of bigger industrial projects;

Transferring of environmental issues to the local parties;

Transferring of knowledge in computer- and control system;

Operation and maintenance software was introduced to the plant-owners.

  1. Personal from boiler plant has been invited to different seminars and work-shops and several presentations about company experience have made, documentation for training has been handed over.

There were arranged seminars through close cooperation between STEM and Estonian partners:

  • Environmentally Friendly Energy Systems in the Baltic Region and Eastern Europe - seminar in Tallinn , 14-15 April, 1994;
  • Environmentally Friendly Energy Systems in the Baltic Region and Eastern Europe - seminar and workshops in Tartu , 25 November, 1994 (prepared information by topics in Estonian over than 150 pages);
  • EAES Programme District Heating Day in Vändra, 27 July, 1995;
  • Environmentally Adapted Local Energy Systems - seminar and presentation of translated into Estonian booklet "Environmentally Adapted Local Energy Planning" in Rakvere, 11 November, 1998 and in Tartu, 12 November, 1998.

A conference for the Estonian District Heating Association is hold local, to give information about the project. The benefits, difficulties, problems, environmental and economical were then discussed.

iv)Activities have been supported by STEM to establish Estonian Biofuels Association: meetings representatives of plant owners and consultants were arranged in Haabneeme, Valga, Võru, Tartu, Pärnu and Viljandi.

The boiler plant has been visited by specialists of other boiler plants, the staff has an exchange of experience with other boiler plants. Estonian Biofuels Association is established in 1998 ( mainly by "bio-club" and local experts) and the company is a member.

Endogenous capacity supported or enhanced:

Endogenous capacity

(Name of organisation1)

Development (DEV) /

enhancement (ENH)

Describe briefly

AS Kuressaare Soojus

Tallinn Technical University

(DEV)

(DEV)

The operators has got knowledge of modern equipment

Technical evaluation

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

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:

An Estonian company has got more experience in planning, erection and start up of bigger industrial projects.

The manager of the company has got high experience in managing bigger industrial projects.

Good training and experience of the staff is necessary to operate biofuel boiler at full capacity.

  1. Technical difficulties:
  2. Effects encountered:

Several local companies have participated in the project

Execution of the follow up and monitoring activities to get feedback to the programme and for evaluation of the results of the different measures.

Consulting support from both Swedish and Estonian side, also after commissioning.

4) Impacts encountered:

  1. Other obstacles encountered:

There were big problems to support the establishment of a wood fuel company.

Local wood fuel market is not yet developed. There have been short brakes in supplying wood fuel.

Lack of a strong national focal point to support and promote biomass energy activities.

  1. Other:

About 60 % of the project costs are spent local.

Improving the positive image of the Kuressaare town (attractive area for tourists) as "green town" promoting environmentally friendly measures and practices and thereby increasing its value for tourism .

No subsidies to renewables, taxation policy is not in support of biofuel use.