Jamnagar Wind Power Projects, India

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					                                         Jamnagar Wind Power Projects, India

                                                             Project Design Documents



The project is a bundle of four project activities. This document consists of the
Project Design Documents (PDDs) for each of the three project activities.


              1. Bundled wind energy power projects (2003 policy) in Rajasthan
              2. Bundled wind energy power projects (2004 policy) in Rajasthan
              3. Bundled wind energy generation projects in Gujarat, India
              4. Enercon Wind Farms in Karnataka Bundled Project – 30.40 MW




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              PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03.1.

CDM – Executive Board

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                         CLEAN DEVELOPMENT MECHANISM
                     PROJECT DESIGN DOCUMENT FORM (CDM-PDD)
                          Version 03 - in effect as of: 28 July 2006

                                             CONTENTS

      A.      General description of project activity

      B.      Application of a baseline and monitoring methodology

      C.      Duration of the project activity / crediting period

      D.      Environmental impacts

      E.      Stakeholders’ comments

                                               Annexes

      Annex 1: Contact information on participants in the project activity

      Annex 2: Information regarding public funding

      Annex 3: Baseline information

      Annex 4: Monitoring plan

      Appendix 1: Location Map

      Appendix 2: Minutes of local stakeholder meeting
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SECTION A. General description of project activity

A.1     Title of the project activity:
>>
Title: Bundled wind energy power projects (2003 policy) in Rajasthan
Version: 3.0
Date of completion of PDD: 30/03/2007

A.2.    Description of the project activity:
>>
Objective of the Project

The objective is development, design, engineering, procurement, finance, construction, operation and
maintenance of bundled wind power projects totalling 30.59 MW wind power projects (“Project”) in the
Indian state of Rajasthan to provide reliable, renewable power to the Rajasthan state electricity grid
which is part of the Northern regional electricity grid. The Project will lead to reduced greenhouse gas
emissions because it displaces electricity from fossil fuel based electricity generation plants.

Nature of Project

The Project harnesses renewable resources in the region, and thereby displacing non-renewable natural
resources thereby ultimately leading to sustainable economic and environmental development. Enercon
(India) Ltd (“Enercon” or “EIL”) is the equipment supplier and the operations and maintenance
contractor for the Project. The generated electricity will be supplied to Rajasthan Rajya Vidyut Prasaran
Nigam Ltd (“RRPVN”)/ Jodhpur Electricity Distribution Company Ltd (“Jodhpur Discom”) under a
long-term power purchase agreement (PPA). The details of the sub-projects comprising the Project are
as under:

•   Enercon Wind Farm Rajasthan:                24 MW
•   Prerna Pharma Intermediates Pvt. Ltd.:      0.23 MW
•   Modular Power:                              0.23 MW
•   Vijay Traders:                              0.23 MW
•   Vijay Developers:                           0.23 MW
•   Vikas Agencies:                             0.23 MW
•   G. C. Chemie Pharmie Ltd.:                  0.23 MW
•   Cooper Metals Pvt. Ltd.:                    0.46 MW
•   Kataria Infrastructure Corporation:         0.6 MW
•   Dempo Industries Pvt. Ltd.:                 0.6 MW
•   D.P.Power:                                  0.23 MW
•   Kataria Infrastructure Corporation:         0.23 MW
•   Kataria Wires:                              0.23 MW
•   Ratlam Wires:                               0.23 MW
•   Kwality Tobacco Products:                   0.23 MW
•   D P Power:                                  0.6 MW
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•    Unique Power Corporation:                    0.6 MW
•    P.V.Chandran:                                0.6 MW
•    Srinivaas Sirigeri:                          0.6 MW

Contribution to sustainable development
The Project meets several sustainable development objectives including:
•    contribution towards the policy objectives of Government of India and Government of Rajasthan of
     incremental capacity from renewable sources;
•    contribution towards meeting the electricity deficit in Rajasthan;
•    CO2 abatement and reduction of greenhouse gas emissions through development of renewable
     technology;
•    reducing the average emission intensity (SOx, NOx, PM, etc.), average effluent intensity and average
     solid waste intensity of power generation in the system;
•    conserving natural resources including land, forests, minerals, water and ecosystems; and
•    developing the local economy and create jobs and employment, particularly in rural areas, which is a
     priority concern for the Government of India;


A.3.    Project participants:
>>
Name of Party involved ((host)       Private and/or public                Kindly indicate if the Party
indicates a host Party)              entity(ies) project participants     involved wishes to be
                                     (*) (as applicable)                  considered as project
                                                                          participant (Yes/No)
Government of India (Host)           Enercon (India) Ltd                  No
Government of Japan                  Japan Carbon Finance                 No

All the sub-projects have authorised Enercon (India) Ltd to take the projects forward as CDM projects.

The contact details of the entities are provided in Annex – 1.

A.4.     Technical description of the project activity:

         A.4.1. Location of the project activity:
>>

                A.4.1.1.          Host Party(ies):
>>
The host party to the project activity is the Government of India.

                 A.4.1.2.         Region/State/Province etc.:
>>
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The Project is located in the State of Rajasthan that forms part of the Northern regional electricity grid of
India.

               A.4.1.3.          City/Town/Community etc:
>>
The sub-projects are located at the following sites in Jaisalmer District of Rajasthan state in India:
• Asloi:       Enercon Wind Farm Rajasthan
•  Korwa:      Prerna Pharma Intermediates Pvt. Ltd., Modular Power, Vijay Traders, Vijay
   Developers, Vikas Agencies, G. C. Chemie Pharmie Ltd., Cooper Metals Pvt. Ltd.
• Sodabandhan: Kataria Infrastructure Corporation, Dempo Industries Pvt. Ltd.
• Temderai I: D.P.Power, Kataria Infrastructure Corporation, Kataria Wires, Ratlam Wires, Kwality
   Tobacco Products
• Temderai II: D P Power, Unique Power Corporation
• Temderai III: P.V.Chandran, Srinivaas Sirigeri

                A.4.1.4.         Detail of physical location, including information allowing the
unique identification of this project activity (maximum one page):
>>
The project area extends between
• Asloi: latitude 26o 33’ & 26o 34.5’ North and longitude 70o 51’ & 70o 53’ East.
• Korwa: latitude 26o 32’ & 26o 33’ North and longitude 70o 53’ & 70o 54’ East.
• Sodabandhan: latitude 26o 32.5’ & 26o 36’ North and longitude 70o 53’ & 70o 55’ East.
• Temderai I, II, III: latitude 26o 42.5’ & 26o 46’ North and longitude 70o 52.5’ & 70o 54.5’ East.

The Project is connected to the RRVPN 33/132/220 kV substation at Amarsagar. The sites are located at
a distance of 35 km from Jaisalmer by road. The nearest railway station is at Jaisalmer. A location map
is attached at Appendix – 1.

         A.4.2. Category(ies) of project activity:
>>
The project activity is considered under CDM category zero-emissions ‘grid-connected electricity
generation from renewable sources’ that generates electricity in excess of 15 MW (limit for small scale
project). Therefore as per the scope of the project activity enlisted in the ‘list of sectoral scopes and
related approved baseline and monitoring methodologies (version 02 Mar 05/07:23)’, the project activity
may principally be categorized in Scope Number 1, Sectoral Scope - Energy industries (renewable/ non-
renewable sources).

        A.4.3. Technology to be employed by the project activity:
>>
The Project involves 30 wind energy converters (WECs) of Enercon make 800 kW E-48, 6 WECs of
Enercon make 600 kW E-40 and 13 WECs of Enercon make 230 kW E-30 with internal electrical lines
connecting the Project with local evacuation facility. The WECs generates 3-phase power at 400V,
which is stepped up to 33 KV. The Project can operate in the frequency range of 47.5–51.5 Hz and in the
voltage range of 400 V ± 12.5%. The other salient features of the state-of-art-technology are:
• Gearless Construction - Rotor & Generator Mounted on same shaft eliminating the Gearbox.
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•   Variable speed function – has the speed range of 18 to 33 RPM thereby ensuring optimum efficiency
    at all times.
•   Variable Pitch functions ensuring maximum energy capture.
•   Near Unity Power Factor at all times.
•   Minimum drawl (less than 1% of kWh generated) of Reactive Power from the grid.
•   No voltage peaks at any time.
•   Operating range of the WEC with voltage fluctuation of -20 to +20%.
•   Less Wear & Tear since the system eliminates mechanical brake, which are not needed due to low
    speed generator which runs at maximum speed of 33 rpm and uses Air Brakes.
•   Three Independent Braking System.
•   Generator achieving rated output at only 33 rpm.
•   Incorporates lightning protection system, which includes blades.
•   Starts Generation of power at wind speed of 3 m/s.

Enercon (India) Ltd has secured and facilitated the technology transfer for wind based renewable energy
generation from Enercon GmbH, has established a manufacturing plant at Daman in India, where along
with other components the "Synchronous Generators" using "Vacuum Impregnation" technology are
manufactured.

         A.4.4   Estimated amount of emission reductions over the chosen crediting period:
>>
Crediting Period for the Project: fixed for 10 years

 Years                                                 Annual estimation of
                                                       emission reductions in
                                                       tonnes of CO2e
             15Aug2007-31Mar2008                                 32,198
             01Apr2008-31Mar2009                                51,517
             01Apr2009-31Mar-2010                               51,517
             01Apr2010-31Mar2011                                51,517
             01Apr2011-31Mar2012                                51,517
             01Apr2012-31Mar2013                                51,517
             01Apr2013-31Mar2014                                51,517
             01Apr2014-31Mar2015                                51,517
             01Apr2015-31Mar2016                                51,517
             01Apr2016-31Mar2017                                51,517
             01Apr2017-14-Aug2017                                19,319
 Total estimated reductions (tonnes of CO2e)                    515,170
 Total number of crediting years                                  10

 Annual average over the crediting period of                    51,517
 estimated reductions (tonnes of CO2e)
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        A.4.5. Public funding of the project activity:
>>
There is no ODA financing involved in the Project.

SECTION B. Application of a baseline and monitoring methodology


B.1.    Title and reference of the approved baseline and monitoring methodology applied to the
project activity:
>>
The approved consolidated baseline and monitoring methodology ACM0002 Version 6.0 (19 May 2006)
has been used. The titles of these baseline and monitoring methodologies are “Consolidated baseline
methodology for grid-connected electricity generation from renewable sources” and “Consolidated
monitoring methodology for grid-connected electricity generation from renewable sources.

B.2      Justification of the choice of the methodology and why it is applicable to the project
activity:
>>
The Project is wind based renewable energy source, zero emission power project connected to the
Rajasthan state grid, which forms part of the Northern regional electricity grid. The Project will displace
fossil fuel based electricity generation that would have otherwise been provided by the operation and
expansion of the fossil fuel based power plants in Northern regional electricity grid.

The approved consolidated baseline and monitoring methodology ACM0002 Version 6 is the choice of
the baseline and monitoring methodology and it is applicable because:
• the Project is grid connected renewable power generation project activity
• the Project represents electricity capacity additions from wind sources
• the Project does not involve switching from fossil fuel to renewable energy at the site of project
    activity since the Project is green-field electricity generation capacities from wind sources at sites
    where there was no electricity generation source prior to the Project, and
• the geographical and system boundaries of the Northern electricity grid can be clearly identified and
    information on the characteristics of the grid is available.

B.3.    Description of the sources and gases included in the project boundary
>>
According to ACM0002, for the baseline emission factor, the spatial extent of the project boundary
includes the project site and all power plants connected physically to the electricity system that the CDM
project power plant is connected to.

The Indian electricity system is divided into five regional grids, viz. Northern, Eastern, Western,
Southern, and North-Eastern. Each grid covers several states. As the regional grids are interconnected,
there is inter-state and inter-regional exchange. A small power exchange also takes place with
neighbouring countries like Bhutan and Nepal.
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The project boundary encompasses the physical extent of the northern regional electricity grid which
includes the project site and all power plants connected physically to the electricity system.

Power generation and supply within the regional grid is managed by Regional Load Dispatch Centre
(RLDC). The Regional Power Committees (RPCs) provide a common platform for discussion and
solution to the regional problems relating to the grid. Each state in a regional grid meets its demand with
its own generation facilities and also with allocation from power plants owned by the Central Sector such
as NTPC and NHPC etc. Specific quotas are allocated to each state from the Central Sector power plants.
Depending on the demand and generation, there are electricity exports and imports between states in the
regional grid. The regional grid thus represents the largest electricity grid where power plants can be
dispatched without significant constraints and thus, represents the “project electricity system” for the
Project. As the Project is connected to the Northern regional electricity grid, the Northern grid is the
“project electricity system”.

            Source                           Gas      Included?      Justification/ Explanation
            Electricity generation from      CO2      Included       Main emission source
            power plants connected to        CH4      Excluded       This source is not required to be
            the Northern Grid                                        estimated for wind energy projects
                                                                     under ACM0002
Baseline




                                             N2O      Excluded       This source is not required to be
                                                                     estimated for wind energy projects
                                                                     under ACM0002
            Electricity generation from      CO2      Excluded       Wind energy generation does not have
Activity
Project




            the Project                      CH4      Excluded       any direct GHG emissions.
                                             N2O      Excluded


B.4.    Description of how the baseline scenario is identified and description of the identified
baseline scenario:

>>
According to ACM0002, for project activities that do not modify or retrofit an existing electricity generation
facility, the baseline scenario is the following:

Electricity delivered to the grid by the project would have otherwise been generated by the operation of
grid-connected power plants and by the addition of new generation sources, as reflected in the combined
margin (CM) calculations described below.

As the Project does not modify or retrofit an existing generation facility, the baseline scenario is the
emissions generated by the operation of grid-connected power plants and by the addition of new
generation sources. This is estimated using calculation of Combined Margin multiplied by electricity
delivered to the grid by the Project.
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B.5.    Description of how the anthropogenic emissions of GHG by sources are reduced below
those that would have occurred in the absence of the registered CDM project activity (assessment
and demonstration of additionality): >>

Step 0: Preliminary screening based on the starting date of the project activity
If project participants wish to have the crediting period starting prior to the registration of their project
activity, they shall:
a) Provide evidence that the starting date of the CDM project activity falls between 1 January 2000 and
   the date of the registration of a first CDM project activity, bearing in mind that only CDM project
   activities submitted for registration before 31 December 2005 may claim for a crediting period
   starting before the date of registration.
b) Provide evidence that the incentive from the CDM was seriously considered in the decision to
   proceed with the project activity. This evidence shall be based on (preferably official, legal and/or
   other corporate) documentation that was available at, or prior to, the start of the project activity.

The Project start date is prior to the date of validation of the PDD. The following evidence will be made
available to the validator to demonstrate that CDM benefits were considered while considering
investments in these projects:
• The Management Committee of Enercon set out the CDM initiative in 2000 and since then monitored
    the progress of the CDM initiative. Enercon management had taken a decision to go ahead with the
    development of the wind farm in Rajasthan in 2002, after duly considering CDM benefits under the
    Kyoto Protocol.
• In late 2001, Government of Netherlands came out with the CERUPT Tender. Enercon participated
    in CERUPT tender by offering 15 MW + 15 MW wind farm projects and was selected under the
    tender. Enercon was not able to conclude the contract with CERUPT and the 15 MW + 15 MW
    projects were subsequently cancelled. However, this provided Enercon with a considerable
    experience in the CDM process.
• Enercon appraised its customers in Rajasthan about the CDM benefits.
• The loan documentation of Enercon Windfarm (Rajasthan) Ltd, one of the sub-projects in this PDD,
    contains provision of sharing of CDM benefits.

Step 1: Identification of alternatives to the project activity consistent with current laws and
regulations
Sub-step 1a. Define alternatives to the project activity:
1. Identify realistic and credible alternative(s) available to the project participants or similar project
developers that provide outputs or services comparable with the proposed CDM project activity. These
alternatives are to include:
    The proposed project activity not undertaken as a CDM project activity;
    All other plausible and credible alternatives to the project activity that deliver outputs and on
    services (e.g. electricity, heat or cement) with comparable quality, properties and application areas;
    If applicable, continuation of the current situation (no project activity or other alternatives
    undertaken).
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Alternative(s) available to the project participants or similar project developers include:
(a)   The Project is not undertaken as a CDM project activity.
(b)   Setting up of comparable utility scale fossil fuel fired or hydro power projects that supply to the
      Rajasthan grid under a PPA.
(c)   Continuation of the current situation where no project activity or any of the above Alternatives are
      undertaken would not be applicable as Rajasthan had energy (MU) shortages of 3.5% and peak
      (MW) shortages of 13.7% in 2005-06 (Source: Northern Region Power Sector Profile, July 2006,
      Ministry of Power).

Sub-step 1b. Enforcement of applicable laws and regulations
2. The alternative(s) shall be in compliance with all applicable legal and regulatory requirements, even
   if these laws and regulations have objectives other than GHG reductions, e.g. to mitigate local air
   pollution. This sub-step does not consider national and local policies that do not have legally-binding
   status.
3. If an alternative does not comply with all applicable legislation and regulations, then show that,
   based on an examination of current practice in the country or region in which the law or regulation
   applies, those applicable legal or regulatory requirements are systematically not enforced and that
   non-compliance with those requirements is widespread in the country. If this cannot be shown, then
   eliminate the alternative from further consideration.
4. If the proposed project activity is the only alternative amongst the ones considered by the project
   participants that is in compliance with all regulations with which there is general compliance, then
   the proposed CDM project activity is not additional.
There are no legal and regulatory requirements that prevent Alternatives (a) and (b) from occurring.

Proceed to Step 2 (Investment analysis) or Step 3 (Barrier analysis). (Project participants may also
select to complete both steps 2 and 3.)

Step 2: Investment Analysis
Determine whether the proposed project activity is the economically or financially less attractive than
other alternatives without the revenue from the sale of certified emission reductions (CERs). To conduct
the investment analysis, use the following sub-steps:
Sub-step 2a. - Determine appropriate analysis method
1. Determine whether to apply simple cost analysis, investment comparison analysis or benchmark
     analysis (sub-step 2b). If the CDM project activity generates no financial or economic benefits other
     than CDM related income, then apply the simple cost analysis (Option I). Otherwise, use the
     investment comparison analysis (Option II) or the benchmark analysis (Option III).
Sub-step 2b. – Option I. Apply simple cost analysis
2. Document the costs associated with the CDM project activity and demonstrate that the activity
     produces no economic benefits other than CDM related income.
Sub-step 2b. – Option II. Apply investment comparison analysis
3. Identify the financial indicator, such as IRR, NPV, cost benefit ratio, or unit cost of service (e.g.,
     levelized cost of electricity production in $/kWh or levelized cost of delivered heat in $/GJ) most
     suitable for the project type and decision-making context.
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Sub-step 2b. – Option III. Apply benchmark analysis
4. Identify the financial indicator, such as IRR, NPV, cost benefit ratio, or unit cost of service (e.g.,
   levelized cost of electricity production in $/kWh or levelized cost of delivered heat in $/GJ) most
   suitable for the project type and decision context.

Option I – Simple cost analysis is not applicable as the project activity sells electricity to the grid and
obtains economic benefits in the form of electricity tariffs.

Enercon proposes to use Option II – Investment comparison analysis and the financial indicator that is
identified is the post-tax return on equity or the equity IRR.
The post tax return on equity and equity IRR is used as the appropriate financial indicator because in the
Indian power sector, a 14% post tax return on equity is an established benchmark for projects in public or
private sector based on cost-plus regulations (Source: Central Electricity Regulatory Commission, Terms
and Conditions of Tariff, Regulations 2004 dated 26 March 2004) for utility scale power plants (similar
to Alternative (b)). Incentives, foreign exchange variations and efficiency in operations are in addition to
this benchmark of 14%.
For determining the tariffs for wind power projects, the electricity regulatory commissions of the state of
Rajasthan and Gujarat have considered the return on equity at 14% while the electricity regulatory
commissions of the state of Madhya Pradesh, Maharashtra and Karnataka have considered the return on
equity at 16%. (Source: RERC Order dated 29 September 2006).
There are some essential differences between the Project (whether implemented with or without CDM
revenues) and the Alternatives identified in Sub-step 1(b) (utility scale fossil fuel and hydro projects).
These should be taken into account while setting the appropriate level of equity IRR.

 •   The project activity tariff structure is a single-part tariff structure as compared to utility scale fossil
     fuel and hydro projects, which have two-part tariff structure. This implies that project activity
     carries a higher investment risk than the utility scale fossil fuel and hydro projects (Alternative (b))
     where the investment recovery is decoupled from the level of actual generation achieved by the
     project due to variations in offtake.
     Thus, in case of the project activity, issues such as transmission unavailability, back-down of
     generation or part-load operations, which are beyond the control of the investors are likely to affect
     the project activity more severely and therefore the project activity investors would require higher
     rate of return to compensate them for these additional risks.
 •   In case of utility scale fossil fuel and hydro projects (Alternative (b)), these are by reference to cost-
     plus approach whereby the projects recover their full investment cost each year if they are able to
     reach specified level of plant availability. In case of the Project, it does not recover its full
     investment cost in the initial years as the tariffs are back-loaded. This increases the investment risks
     in the project activity compared to the alternatives.

Based on the above considerations, 16% post-tax equity IRR is considered to be the appropriate post-tax
equity return. If the Project has a post-tax equity IRR of less than 16%, then it can be considered to be
additional.

Sub-step 2c. Calculation and comparison of financial indicators (only applicable to options II and III):
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5. Calculate the suitable financial indicator for the proposed CDM project activity and, in the case of
   Option II above, for the other alternatives. Include all relevant costs (including, for example, the
   investment cost, the operations and maintenance costs), and revenues (excluding CER revenues, but
   including subsidies/fiscal incentives where applicable), and, as appropriate, non-market cost and
   benefits in the case of public investors.
6. Present the investment analysis in a transparent manner and provide all the relevant assumptions in
   the CDM-PDD, so that a reader can reproduce the analysis and obtain the same results. Clearly
   present critical techno-economic parameters and assumptions (such as capital costs, fuel prices,
   lifetimes, and discount rate or cost of capital). Justify and/or cite assumptions in a manner that can be
   validated by the DOE. In calculating the financial indicator, the project’s risks can be included
   through the cash flow pattern, subject to project-specific expectations and assumptions (e.g.
   insurance premiums can be used in the calculation to reflect specific risk equivalents).
7. Assumptions and input data for the investment analysis shall not differ across the project activity and
   its alternatives, unless differences can be well substantiated.
8. Present in the CDM-PDD submitted for validation a clear comparison of the financial indicator for
   the proposed CDM activity and:
        (a)     The alternatives, if Option II (investment comparison analysis) is used. If one of the
                other alternatives has the best indicator (e.g. highest IRR), then the CDM project activity
                can not be considered as the most financially attractive;
        (b)     The financial benchmark, if Option III (benchmark analysis) is used. If the CDM project
                activity has a less favourable indicator (e.g. lower IRR) than the benchmark, then the
                CDM project activity cannot be considered as financially attractive.
The key assumptions used for calculating the benchmark (post-tax equity IRR) are set out below. These
details are taken for Enercon Wind Farm (Rajasthan) Ltd.:
 Capacity of Machines in kW                                                800
 Number of Machines                                                         30
 Project Capacity in MW                                                 24.00
 Project Commissioning Date                                          1-Apr-05
 Project Cost per MW (Rs. In Millions)                                    48.4


 Operations
  Plant Load Factor                                                    22.00%
   Insurance Charges @ % of capital cost                                0.18%
   Operation & Maintenance Cost base year @ % of capital cost           1.25%
   % of escalation per annum on O & M Charges                            5.0%


 Tariff
   Base year Tariff (2003-04) - Rs./Kwh                                   3.32
   Annual Escalation (Rs./kWh per Year)                                   0.06
   Tariff applicable from 2013-14 onwards (Rs/kWh)                        3.92
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Project Cost                                                  Rs Million
Land and Infrastructure, Generator & Electrical Equipments,
Mechanical Equipments, Civil Works, Instrumentation &
Control, Other Project Cost, Pre operative Expenses, etc.
Total Project Cost                                                1,163


Means of Finance                                                           Rs Million
Own Source                                                         30%           349
Term Loan                                                          70%           814
Total Source                                                                   1,163

Terms of Loan
  Interest Rate                                                  8.50%
  Tenure                                                            10     Years
  Moratorium                                                         6     Months



Income Tax Depreciation Rate (Written Down Value basis)
  on Wind Energy Generators                                        80%
  On other Assets                                                  10%

Book Depreciation Rate (Straight Line Method basis)
  On all assets                                                  7.86%
Book Depreciation up to (% of asset value)                         90%



Income Tax
  Income Tax rate                                                  30%
  Minimum Alternate Tax                                            10%
  Surcharge                                                        10%
  Cess                                                              2%

Working capital
 Receivables (no of days)                                            45
 O & m expenses (no of days)                                         30
 Working capital interest rate                                     12%

CER Revenues
 CER Price in US$                                                    -
 Exchange rate Rs./US$*                                           43.59
* RBI reference rate as of 30 March 2007



Crediting period starts                                       1-June-07
Length of Crediting period                                           10
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 Baseline Emission Factor for Northern Region (tCO2/GWh)               873.87


The equity IRR for the Project without CDM revenues is 12% and with CDM revenues is 13.3%.

Sub-step 2d. Sensitivity analysis (only applicable to options II and III):
9. Include a sensitivity analysis that shows whether the conclusion regarding the financial attractiveness
   is robust to reasonable variations in the critical assumptions. The investment analysis provides a
   valid argument in favor of additionality only if it consistently supports (for a realistic range of
   assumptions) the conclusion that the project activity is unlikely to be the most financially attractive
   (as per step 2c para 8a) or is unlikely to be financially attractive (as per step 2c para 8b).
Sensitivity analysis of the Equity IRR to the Plant Load Factor (the most critical assumption) has been
carried out considering a plant load factor of 20% (plant load factor as observed in recent past for other
Enercon projects) and 23.97% (highest plant load factor achieved according to RERC, in its Order dated
29 September 2006). Plant Load Factor is the key variable encompassing variation in wind profile,
variation in off-take (including grid availability) including machine downtime. The post tax Equity IRRs
at the stated PLFs are as follows:


                                                PLF at 20%                        PLF at 23.97%
      Post tax Equity IRR without                  9.1%                              14.9%
      CER revenues
      Post tax Equity IRR with CER                 10.3%                             16.3%
      revenues


As can be seen from above, the Project is not the most financially attractive (as per step 2c para 8a) we
proceed to Step 4 (Common practice analysis).
Step 4. Common practice analysis

Sub-step 4a. Analyze other activities similar to the proposed project activity:

1. Provide an analysis of any other activities implemented previously or currently underway that are
   similar to the proposed project activity. Projects are considered similar if they are in the same
   country/region and/or rely on a broadly similar technology, are of a similar scale, and take place in a
   comparable environment with respect to regulatory framework, investment climate, access to
   technology, access to financing, etc. Other CDM project activities are not to be included in this
   analysis. Provide quantitative information where relevant.

Sub-step 4b. Discuss any similar options that are occurring:

2. If similar activities are widely observed and commonly carried out, it calls into question the claim
   that the proposed project activity is financially unattractive (as contended in Step 2) or faces barriers
   (as contended in Step 3). Therefore, if similar activities are identified above, then it is necessary to
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   demonstrate why the existence of these activities does not contradict the claim that the proposed
   project activity is financially unattractive or subject to barriers. This can be done by comparing the
   proposed project activity to the other similar activities, and pointing out and explaining essential
   distinctions between them that explain why the similar activities enjoyed certain benefits that
   rendered it financially attractive (e.g., subsidies or other financial flows) or did not face the barriers
   to which the proposed project activity is subject.
3. Essential distinctions may include a serious change in circumstances under which the proposed CDM
   project activity will be implemented when compared to circumstances under which similar projects
   where carried out. For example, new barriers may have arisen, or promotional policies may have
   ended, leading to a situation in which the proposed CDM project activity would not be implemented
   without the incentive provided by the CDM. The change must be fundamental and verifiable.

We analyze the extent to which wind energy projects have diffused in the electricity sector in Rajasthan.
In 2005 – 06, electricity generation from wind sources was 417 GWh which is expected to increase to
512 GWh in 2006 – 07. This works out to 1.35% of total generation available to the state of Rajasthan in
2005 – 06 and 1.66% of total expected generation available to the state of Rajasthan in 2006 – 07.
Clearly, electricity generation from wind is not a common practice in Rajasthan.

We analyze the wind energy projects in Rajasthan that have come under different policy regimes and in
different years. Briefly, the various policies have progressively decreased the electricity tariffs payable
by the offtaker (RRVPN/Discoms) and have progressively passed on burden of providing or paying for
transmission facilities. Below is the electricity tariff payable under different policies:

Electricity tariff (Rs/kWh)    1999-    2000-    2001-    2002-    2003-    2004-    2005-    2006-    2007-
                                00       01       02       03       04       05       06       07       08
1999 Policy                   2.89     3.03     3.18     3.34     3.51     3.69     3.87     4.06     4.27
2000 Policy                            3.03     3.18     3.34     3.51     3.68     3.87     4.06     4.26
2003 Policy                                                       3.32     3.39     3.45     3.52     3.59
2004 Policy (Original)                                                     2.91     2.96     3.01     3.06
2004 Policy (Amended)                                                               3.25     3.31     3.37


Out of the 279 MW installed up to 31 March 2005, the wind power projects under various policies of
Government of Rajasthan are set out below:
Policy 1999 (effective 11th March 1999): 4.25 MW
Policy 2000 (effective 4th Feb 2000): 82.23 MW
Policy 2003 (effective 30th April 2003): 174.29 MW
Policy 2004 (effective 25th October 2004): 18.85 MW

Based on the commissioning dates of the wind projects in the CDM pipeline (on the cdm.unfccc.int
website), we estimate that the following capacities are being developed or have been developed as CDM
project activities (including this Project):
 • Policy 2000: 28.16 MW
 • Policy 2003: 79.45 MW + 30.59 MW (this Project) = 110.04 MW
 • Policy 2004: 15.75 MW

Clearly, wind power project development in Rajasthan is insignificant when compared to the power
sector of Rajasthan. Further, wind power project development is substantially dependent on CDM
mechanism and thus is not common practice.
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Sub-steps 4a and 4b are satisfied.

Step 5. Impact of CDM registration

Explain how the approval and registration of the project activity as a CDM activity, and the attendant
benefits and incentives derived from the project activity, will alleviate the economic and financial
hurdles (Step 2) or other identified barriers (Step 3) and thus enable the project activity to be undertaken.

Registering the project activity as a CDM activity provides a significant amount of revenue, improving
the project’s cash flow and improving the equity IRR by 1.3%. The revenues from sale of the Certified
Emission Reductions would enhance the viability of the project and would partially offset the risks
associated with the possible changes in policy, wind regime, project implementation risks (time and cost
overruns), etc. Further, CER revenues will be high quality cash flows coming from creditworthy parties
and denominated in foreign currency. The CDM revenues will attract new players to wind investments in
Rajasthan, as they provide compensation for the regulatory and project risks implicit in the wind power
projects.

B.6.     Emission reductions:
         B.6.1. Explanation of methodological choices:
>>

According to the approved baseline methodology ACM0002, the emission reductions ERy by the project
activity during a given year “y1” is

ERy = BEy – PEy – Ly……………….(1)

where BEy          is the baseline emissions
      PEy          is project activity emissions and;
      Ly           is the amount of emissions leakage resulting from the project activity.


Baseline Emissions for the amount of electricity supplied by project activity, BEy is calculated as

BEy = EGy * EFy …………………….(2)

where EGy is the electricity supplied to the grid, EFy is the CO2 emission factor of the grid as calculated
below.

The emission factor EFy of the grid is represented as a combination of the Operating Margin (OM) and
the Build Margin (BM). Considering the emission factors for these two margins as EFOM,y and EFBM,y,
then the EFy is given by:

1
  Throughout the document, the suffix y denotes that such parameter is a function of the year y, thus to be monitored at least
annually.
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EFy = wOM * EFOM,y + wBM * EFBM,y…………………………..(2)

with respective weight factors wOM and wBM (where wOM + wBM = 1).


The Operating Margin emission factor

As per ACM0002, dispatch data analysis should be the first methodological choice. However, this
option is not selected because the information required to calculate OM based on dispatch data is not
available in the public domain for the Northern electricity regional grid.

The Simple Operating Margin approach is appropriate to calculate the Operating Margin emission factor
applicable in this case. As per ACM 0002 the Simple OM method can only be used where low cost must
run resources constitute less than 50% of grid generation based on average of the five most recent years.
The generation profile of the Northern grid in the last five years is as follows:

 Generation in GWh                                            2004-05    2003-04      2002-03   2001-02   2000-01
 Low cost/must run sources
   Hydro                                                        36,128     38,279      30,335    29,129      29,020
   Wind                                                            332         15          25        19           6
   Nuclear                                                       7,503      7,380       8,800     8,158       6,669
 Other sources
   Coal                                                       106,156     103,232     100,362    96,882    92,417
   Diesel                                                           -           -           -        24         -
   Gas                                                         19,991      18,758      17,262    17,634    16,863
 Total Generation                                             170,109     167,663     156,785   151,845   144,975
 Low cost/must run sources                                     43,962      45,674      39,160    37,305    35,695
 Low cost/must run sources                                       26%         27%         25%       25%       25%

Source: Table 3.4 of CEA General Review 2004-05, 2003-04, 2002-03, 2001-02, 2000-01

From the available information it is clear that low cost/must run sources account for less than 50% of the
total generation in the Northern grid in the last five years. Hence the Simple OM method is appropriate to
calculate the Operating Margin Emission factor applicable.

Build Margin Emission Factor

The Build Margin emission factor EF_BMy (tCO2/GWh) is given as the generation-weighted average
emission factor of the selected representative set of recent power plants represented by the 5 most recent
plants or the most recent 20% of the generating units built (summation is over such plants specified by
k):

EFBM,y = [∑i Fi,m,y*COEFi] / [∑k GENk,m,y]………………………..(5)

The summation over i and k is for the fuels and electricity generation of the plants in sample m
mentioned above.
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The choice of method for the sample plant is the most recent 20% of the generating units built as this
represents a significantly larger set of plants, for a large regional electricity grid have a large number of
power plants connected to it, and is therefore appropriate.

The Central Electricity Authority, Ministry of Power, Government of India has published a database of
Carbon Dioxide Emission from the power sector in India based on detailed authenticated information
obtained from all operating power stations in the country. This database i.e. The CO2 Baseline Database
provides information about the Operating Margin and Build Margin Emission Factors of all the regional
electricity grids in India. The Operating Margin in the CEA database is calculated ex ante using the
Simple OM approach and the Build Margin is calculated ex ante based on 20% most recent capacity
additions in the grid based on net generation as described in ACM0002. We have, therefore, used the
Operating Margin and Build Margin data published in the CEA database, for calculating the Baseline
Emission Factor.

Combined Margin Emission Factor

As already mentioned, baseline emission factor (EFy) of the grid is calculated as a combined margin
(CM), calculated as the weighted average of the operating margin (OM) and build margin (BM) factor. In
case of wind power projects default weights of 0.75 for EFOM and 0.25 for EFBM are applicable as per
ACM0002. No alternate weights are proposed.

Using the values for operating margin and build margin emission factors provided in the CEA database
and their respective weights for calculation of combined margin emission factor, the baseline carbon
emission factor (CM) is 873.87 tCO2e/GWh or 0.87387 tCO2e/MWh.

Project Emissions:

The project activity uses wind power to generate electricity and hence the emissions from the project
activity are taken as nil.

PEy = 0

Leakage:

Emissions Leakage on account of the project activity is ignored in accordance with ACM0002.

Ly = 0

         B.6.2. Data and parameters that are available at validation:
         >>

Data / Parameter:         EFOM,y
Data unit:                tCO2e/MWh
Description:              Operating Margin Emission Factor of Northern Regional Electricity Grid
Source of data used:      “CO2 Baseline Database for Indian Power Sector” published by the Central
                          Electricity Authority, Ministry of Power, Government of India.
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                        The “CO2 Baseline Database for Indian Power Sector” is available at
                        www.cea.nic.in

Value applied:
                         2002 – 03    0.9993
                         2003 – 04    0.9869
                         2004 – 05    0.9756
Justification of the
choice of data or Operating Margin Emission Factor has been calculated by the Central
description          of Electricity Authority using the simple OM approach in accordance with
measurement methods ACM0002.
and          procedures
actually applied :


Data / Parameter:       EFBM,y
Data unit:              tCO2e/MWh
Description:            Build Margin Emission Factor of Northern Regional Electricity Grid
Source of data used:    “CO2 Baseline Database for Indian Power Sector” published by the Central
                        Electricity Authority, Ministry of Power, Government of India.

                        The “CO2 Baseline Database for Indian Power Sector” is available at
                        www.cea.nic.in

Value applied:          0.5335
Justification of the
choice of data or Build Margin Emission Factor has been calculated by the Central Electricity
description          of Authority in accordance with ACM0002.
measurement methods
and          procedures
actually applied :
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       B.6.3 Ex-ante calculation of emission reductions:
       >>
Ex-ante calculation of emission reductions is equal to ex-ante calculation of baseline emissions as project
emissions and leakage are nil.

Baseline emission factor (combined margin)
= 873.87 tCO2e/GWh

Annual electricity supplied to the grid by the Project
= 30.59 MW (Capacity) x 22% (PLF) x 8760 (hours) / 1000 GWh
= 58.953 GWh

Annual baseline emissions
= 873.87 tCO2e/GWh x 58.953 GWh
= 51,517 tCO2e

        B.6.4   Summary of the ex-ante estimation of emission reductions:
        >>
 Year               Estimation of         Estimation of        Estimation       Estimation of
                    project activity      baseline             of leakage       overall emission
                    emissions (tonnes     emissions            (tonnes of       reductions (tonnes
                    of CO2e)              (tonnes of CO2e)     CO2e)            of CO2e)
   15Aug2007-                         0         32,198                      0          32,198
   31Mar2008
   01Apr2008-                         0         51,517                      0          51,517
   31Mar2009
   01Apr2009-                         0         51,517                      0          51,517
   31Mar-2010
   01Apr2010-                         0         51,517                      0          51,517
   31Mar2011
   01Apr2011-                         0         51,517                      0          51,517
   31Mar2012
   01Apr2012-                         0         51,517                      0          51,517
   31Mar2013
   01Apr2013-                         0         51,517                      0          51,517
   31Mar2014
   01Apr2014-                         0         51,517                      0          51,517
   31Mar2015
   01Apr2015-                         0         51,517                      0          51,517
   31Mar2016
   01Apr2016-                         0         51,517                      0          51,517
   31Mar2017
   01Apr2017-                         0         19,319                      0          19,319
   14Aug2017
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 Year              Estimation of        Estimation of      Estimation       Estimation of
                   project activity     baseline           of leakage       overall emission
                   emissions (tonnes    emissions          (tonnes of       reductions (tonnes
                   of CO2e)             (tonnes of CO2e)   CO2e)            of CO2e)
 Total (tonnes                      0            515,170                0              515,170
 of CO2e)



B.7     Application of the monitoring methodology and description of the monitoring plan:
        B.7.1 Data and parameters monitored:

Data / Parameter:        EGy
Data unit:               MWh (Mega-watt hour)
Description:             Net electricity supplied to the grid by the Project
Source of data to be     Electricity supplied to the grid as per the tariff invoices raised on
used:                    RRVPNL/Jodhpur Discom.
Value of data applied    Annual electricity supplied to the grid by the Project
for the purpose of       = 30.59 MW (Capacity) x 22% (PLF) x 8760 (hours) GWh
calculating  expected    = 58,953 MWh
emission reductions in
section B.5
Description         Net electricity supplied to grid will be measured by main meters (export and
                    of
measurement methods import). The procedures for metering and meter reading will be as per the
and procedures to beprovisions of the power purchase agreement and the Metering Code of
applied:            Rajasthan. Refer Annex – 4 for an illustration of the provisions for measurement
                    methods.
QA/QC procedures to QA/QC procedures will be as implemented by RRVPN/Jodhpur Discom
be applied:         pursuant to the provisions of the power purchase agreement and the Metering
                    Code of Rajasthan and there will be no additional QA/QC procedures. Refer
                    Annex – 4 for an illustration of the provisions for QA/QC procedures.
Any comment:

        B.7.2 Description of the monitoring plan:
>>
Approved monitoring methodology ACM0002 / Version 06 Sectoral Scope: 1, “Consolidated monitoring
methodology for zero-emissions grid-connected electricity generation from renewable sources”, by CDM
- Meth Panel is proposed to be used to monitor the emission reductions.

This approved monitoring methodology requires monitoring of the following:
• Electricity generation from the project activity; and
• Operating margin emission factor and build margin emission factor of the grid, where ex post
    determination of grid emission factor has been chosen
Since the baseline methodology is based on ex ante determination of the baseline, the monitoring of
operating margin emission factor and build margin emission factor is not required.
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The sole parameter for monitoring is the electricity supplied to the grid. The Project is operated and
managed by Enercon (India) Ltd. The operational and management structure implemented by Enercon is
as follows:

    STRUCTURE                      RESPONSIBILITY

Managing Director
Enercon India Ltd


     CDM                         Review, Corrective
     co-ordinator


    Corporate                    Review, internal
    CDM


   Regional Service              Check, authorize & forward
       Heads                     monitoring


     O&M Team                    Monitor, record, report
                                 archive


Training and maintenance:

Training on the machine is an essential pre-requisite, to ensure necessary safety of man and machine.
Further, in order to maximize the output from the Wind Energy Converters (WECs), it is extremely
essential, that the engineers and technicians understand the machines and keep them in good health. In
order to ensure, that Enercon’s service staff is deft at handling technical snags on top of the turbine, the
necessity of ensuring that they are capable of climbing the tower with absolute ease and comfort has been
established. The Enercon Training Academy provides need-based training to meet the training
requirements of Enercon projects. The training is contemporary, which results in imparting focused
knowledge leading to value addition to the attitude and skills of all trainees. This ultimately leads to
creativity in problem solving.

B.8     Date of completion of the application of the baseline study and monitoring methodology
and the name of the responsible person(s)/entity(ies)
>>
Date of completion: 30/03/2007

Name of responsible person/entity:
PricewaterhouseCoopers Private Limited (not a Project Participant)
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SECTION C. Duration of the project activity / crediting period

C.1     Duration of the project activity:

       C.1.1. Starting date of the project activity:
>>
30/04/2003 being the date of placement of purchase order for the first project in the bundle.

        C.1.2. Expected operational lifetime of the project activity:
>>
20 years

C.2     Choice of the crediting period and related information:

        C.2.1. Renewable crediting period

                C.2.1.1.         Starting date of the first crediting period:
>>

                C.2.1.2.         Length of the first crediting period:
>>

        C.2.2. Fixed crediting period:

                  C.2.2.1.     Starting date:
>>
15/08/2007, being the beginning of the month subsequent to the month in which the project is expected
to be registered.

                C.2.2.2.         Length:
>>
10 years

SECTION D. Environmental impacts
>>

D.1.    Documentation on the analysis of the environmental impacts, including transboundary
impacts:
>>
Enercon appointed Aditya Environmental Services Private Limited to conduct rapid environmental
impact assessment study to assess the impact of the project on the local environment.

Environmental Impact Assessment (EIA) of this project is not an essential regulatory requirement, as it is
not covered under the categories as described in EIA Notification of 1994 or the Amended Notification
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of 2006. However, Enercon conducted the EIA to study impacts on the environment resulting from the
project activity.

The EIA study included identification, prediction and evaluation of potential impacts of the CDM
activities on air, water, noise, land, biological and socioeconomic environment within the study area. The
ambient air concentrations of Suspended Particulate Matter, Respirable Particulate Matter, Oxides of
Nitrogen, Sulphur dioxide and Carbon Monoxide were monitored and were found under limits as
specified by CPCB. The noise levels were observed through out the study period and were found to be in
the permissible range. Water quality monitoring studies were carried out for determination of physico-
chemical characteristics of bore wells. The ph level of water was found to be under the specified limits.

The study area represents part of Jaisalmer district, which is part of the Thar desert. The terrain is rough
comprising sandy or stony wasteland & is very sparsely populated. The windfarm is located in the mist of
the Indian ‘Thar’ Desert and does not come in the path of the migratory birds. There is no wild life or
forestland near the project sites.

D.2.    If environmental impacts are considered significant by the project participants or the host
Party, please provide conclusions and all references to support documentation of an environmental
impact assessment undertaken in accordance with the procedures as required by the host Party:
>>
EIA demonstrated that there is no major impact on the environment due to the installation and operation
of the windmills. The desert ecology is not likely to get impacted by this type of project activity. The
local population confirmed that there is no noise or dust nuisance due to windmills. The EIA also ruled
out any adverse impacts due to the project activity.

SECTION E. Stakeholders’ comments
>>

E.1.   Brief description how comments by local stakeholders have been invited and compiled:
>>
The comments from local stakeholders were invited through a local stakeholder meeting conducted at
Gorbandh Palace, Jaisalmer on 18 September 2006. A letter for the meeting to be conducted was
provided to the gram sarpanch 1st September 2006 inviting the local stakeholders for the meeting.

The local stakeholder consultation meeting had representatives from the nearby villages, representatives
of Enercon and representative of Aditya Environmental Services (consultant to Enercon). The minutes of
the meeting are set out in Appendix 2.

E.2.    Summary of the comments received:
>>
The comments from local stakeholders covered the benefits the wind project activities have provided
including employment opportunities to the local people, better transportation facilities to the near by
towns, improved water availability, etc.

The local stakeholders did not find any negative impacts on account of the project activity on, inter alia,
grazing by the cattle, affecting migratory patterns of the birds, noise levels, accidents, etc.
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E.3.     Report on how due account was taken of any comments received:
>>
Enercon provided the following responses in relation to the comments received from the local
stakeholders:
• The benefits to the local stakeholders will be through employment opportunities provided by the
    project in terms of small shops and construction workers. It will also lead to better connectivity to
    nearby towns.
• The project does not affect the grazing by the cattle. Enercon does not use any kind for boundary
    wall to protect their machines and hence the accessibility of cattle to areas for grazing and drinking
    water is not affected.
• The Project does not fall under migratory patterns of the birds.
• Project has improved the availability of water, which can also be accessed from project site. The tube
    wells are located at a distance of 3 Km from project site which the people daily access.
• Enercon has appropriate protocols are in place to take care of all the safety issues. No incidence of
    accident has occurred.
• No noise disturbances have been observed so far and local inhabitation is far away from the project
    site.
• A school was reconstructed by Enercon India Limited in police lane in Jaisalmer, Rajasthan in 2004
    – 05. Enercon will bear in mind the requirement of school in the village and opportunities for
    women in the village when it undertakes further developmental work.

The local stakeholders were satisfied with the explanations provided during the meeting.
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                                               Annex 1

       CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY

Organization:            Enercon (India) Limited
Street/P.O.Box:          A-9, Veera Industrial Estate, Veera Desai Road, Andheri West-400053
Building:                Enercon Tower
City:                    Mumbai
State/Region:            Maharashtra
Postfix/ZIP:             400 053
Country:                 India
Telephone:               +91-22-66924848
FAX:                     +91-22-67040473
E-Mail:                  a.raghavan@enerconindia.net
URL:
Represented by:
Title:                   Associate Vice President
Salutation:              Mr.
Last Name:               A V Raghavan
Middle Name:
First Name:
Department:              Corporate
Mobile:                  +91-98200 45724
Direct FAX:              +91-22-5692 1175
Direct tel:              +91-22-6692 4848 extn. 7169
Personal E-Mail:         a.raghavan@enerconindia.net


Organization:            Japan Carbon Finance, Ltd.
Street/P.O.Box:          6th Floor, 1-3 Kundankita, 4-chrome
Building:                Chiyoda-ku
City:                    Tokyo
State/Region:
Postfix/ZIP:             102-0073
Country:                 Japan
Telephone:               +81 3 5212 8870
FAX:                     +81 3 5212 8886
E-Mail:                  jcf@jcarbon.co.jp
URL:                     http://www.japancarbon.co.jp/
Represented by:
Title:                   Deal Manager
Salutation:              Mr.
Last Name:               Shozo
Middle Name:
First Name:              Watanabe
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Department:              Carbon Finance Department
Mobile:
Direct FAX:              +81 3 5212 8886
Direct tel:              +81 3 5212 8878
Personal E-Mail:         s-watanabe@jcarbon.co.jp
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                                             Annex 2

                      INFORMATION REGARDING PUBLIC FUNDING

No ODA financing has been used in the project activity.
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Annex 3

                                   BASELINE INFORMATION

The Operating Margin data for the most recent three years and the Build Margin data for the Northern
Region Electricity Grid as published in the CEA database are as follows:

Simple Operating Margin

                                                tCO2e/GWh
 Simple Operating Margin - 2002-03                     999.35
 Simple Operating Margin - 2003-04                     986.94
 Simple Operating Margin - 2004-05                     975.68
 Average Operating Margin of last three years          987.32

Build Margin

                                                tCO2e/GWh
 Build Margin                                          533.52

Combined Margin calculations

                                   Weights      tCO2e/GWh
 Operating Margin                      0.75              987.32
 Build Margin                          0.25              533.52
 Combined Margin                                         873.87

Detailed information on calculation of Operating Margin Emission Factor and Build Margin Emission
Factor is available at www.cea.nic.in.
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                                                Annex 4

                                  MONITORING INFORMATION
•   The electricity supplied to the grid will be metered at the 33/132/220 kV level at the RRVPN
    substation at Amarsagar. Representatives of RRVPN/Jodhpur Discom and Enercon will jointly take
    the main reading and sign the meter reading on the first day of every month. Simultaneously, the
    joint meter reading at the 33/132/220 kV level of the backup metering system at Temderai substation
    will also be taken by representatives of RRVPN/Jodhpur Discom and Enercon.

•   The meters will jointly inspected/tested once in a year as per the terms of the PPA. Joint inspection
    and testing will also be carried out as and when difference in monthly meter readings exceeds the
    sum of maximum error as per accuracy class of main and back up meters.

•   In case the meters are found to operate outside the permissible limits, the meters will be either
    replaced immediately or calibrated. Error correction will be applied to the meter reading. Whenever
    a main meter goes defective, the consumption recorded by the backup meter will be referred. The
    details of the malfunctioning along with date and time and snaps shot parameters along with load
    survey will be retrieved from the main meter. The exact nature of the malfunctioning will be
    determined after analyzing the data so retrieved and the consumption recorded by the main meter will
    be assessed accordingly. Further, correction for the transmission loss between Temdarai and
    Amarsagar will be carried by reference to the transmission loss calculated using the data of the main
    meter and backup meter on the other double circuit line. This transmission loss will be applied to the
    backup meter reading to arrive at the electricity supplied to the grid where the main meter has been
    found to be defective.

•   If main as well as back up metering system becomes defective, the assessment of energy
    consumption for the outage period will be done from the backup meters by the concerned parties as
    mutually agreed or at the level of Metering Committee set up under the Metering Code.

•   The main and the backup metering systems will be sealed in presence of representatives of Enercon
    and RRVPN/Jodhpur Discom.
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                              Appendix 1 – Location Map
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                   Appendix 2 – Minutes of stakeholder consultation meeting

       Public Consultation Meeting for Wind Energy Projects at Clean Development Mechanism
       Project of Enercon (India) Limited. situated at Kita. Bhu, Sodabhandhan ,Temderai(Phase I,
       PhaseII and PhaseIII), Asloi, Jodha, Korwa and Badabagh in Jaisalmer,Rajasthan
                                     Jaisalmer, District Rajasthan, India
                                       MINUTES OF THE MEETING
       Venue: Gorbandh Palace, Jaisalmer                                   Date: 18 Sep 2006
       The people participated are the following:
       Representatives:
       Representatives from the Village:
       Shri. Rahim Singh
       Shri. Punam Singh
       Shri Kishan Singh
       The list of all other people from the villages is annexed.
       Enercon (India) Limited:
       Mr. Anupam Mathur
       Mr. Rajendra Vyas
       Mr. Rakesh Chhangani
       Mr. Dilip Sharma
       Mr. Neeraj Gupta
       Aditya Environmental Services Pvt. Ltd.
       Mr. Gurmeet Singh
       Mr. Anupam Mathur invited Mr. Punam Singh, Ex- Sarpanch to chair the meeting.

       The agenda of the meeting is fixed as follows:
       Welcome
       Description of the project details
       Queries and responses from the proponent and the stakeholders
       Vote of thanks

                                              WELCOME ADDRESS
       Mr. Dilip Sharma, Security and Liasoning person from Enercon India Limited welcomed all
       the people who came to take part in the meeting. There were more than 20 people from all the
       villages that fall in the vicinity of the project sites.

       Description of the Project Details.
       The present stakeholder consultation is for 60 MW of Enercon Wind Farm Hindustan Limited
       and for 82.74 MW of the customer projects out of which 47.01 MW has been finalized and
       the rest 35.73 MW is in the process to be considered. Some the projects will also come up in
       addition to the finalised projects for CDM.
       The Knowledge of the wind farm was communicated to the local people in the local language.
       The wind farm projects falls in the category of the renewable energy. The meaning of the
       renewable energy was explained. The sites where the projects are located have no commercial
       activity and is a waste land.
       The best use of land is made through the project which otherwise was barren. Improved
       supply of electricity to the grid, and employment opportunities to local people. He explained
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       function advantages of the windmill to the people. Self reliance on using renewable energy
       sources is observed in Jaisalmer.
       The comparison between the wind farm projects and other alternatives is drawn in order to
       convey the advantages that wind power possess over other alternatives. The sites are located
       near Badabagh, Sodabandhan, Korwa, Asloi, Bhu, Temderai (Phase I, Phase II and Phase III)
       and Kita.
       In addition several other support services augmented by Enercon to local people in terms of
       transportation, mid –day meals to school children, renovation of Temedarai temple etc. as its
       social community initiatives.

                                   SPEECH BY MR. PUNAM SINGH
       The chairperson of the meeting briefed the advantages of the wind farm. The project has
       provided the employment opportunities to the local people as the result of which the income
       of the people have increased. He also praised Enercon India Limited for investing in district of
       Jaisalmer.
       Mr. Rahim Singh (BHU Sarpanch)
       The villagers in this part of the state are very backward but the times are changing with
       coming up of the wind farm projects of the Enercon India Limited. The project has provided
       the employment opportunities to the people. Security, drivers and labour people are selected
       among the local villagers.


      Mr. Gurmeet Singh, Aditya Environmental Services briefed the environmental benefits of
      wind power generation as compared to that of thermal power generation based on coal.
      Similarly, a briefing on GHG and its role in global warming / increasing temperatures on the
      earth was given. The benefits in terms of pollution free environment and safeguard to human
      health were also communicated to the stakeholders while comparing coal-based generation to
      wind based generation. The Government of Rajasthan is also encouraging the development of
      renewable energy. Summary on Kyoto Protocol and CDM were made available.

     The concerns, suggestions, opinions of the stakeholders have been specially invited. The
     participants expressed the queries as given below. The representatives from ENERCON
     clarified them as given below.
                       Queries                                    Responses
1.   What are the benefits of the wind power  The project has provided the people with the
     projects the stakeholders have observed? employment opportunities. The project has given
                                              jobs and economic opportunities in terms of small
                                              shops and construction workers.                  The
                                              transportation facilities has improved and has
                                              increased their accessibility to the near by town.
2.   Has the project affected the grazing of  No, the project does not affect the grazing by the
     local cattle?                            cattle. Enercon India Limited does not use any
                                              kind for boundary wall to protect their machines
                                              and hence the accessibility of cattle to areas for
                                              grazing and drinking water is not affected.
3.   Has the project affected any migratory   The project does not fall under migratory patterns
     patterns of birds or fauna?              of the birds. The major birds migrating in the
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                                                   region, but away from project site are “ Gatta”,
                                                   Tilor, and Solan, which usually take their path
                                                   away from the project site.
4.    Has the project affected the water           The project has improved the availability of water,
      availability? How far are the tube wells     which can also be accessed from project site. The
      located from the site?                       tube wells are located at a distance of 3 Km from
                                                   project site which the people daily access.
5.    During construction and erection has any     As to date no incidence of accident has occurred.
      incident of accident or damage occurred?
6.    Do Enercon take care of safety issues?       The Enercon India Limited takes care about the
                                                   safety issues. Appropriate protocols are in place to
                                                   take care of all the safety issues.
7.    Have you observed any noise                  No noise disturbances have been so far. Local
      disturbances from the project during         inhabitation is far away from the project site.
      construction and operation of the project
      has occurred by the local people?

Women Representative
The women representative asked if school could be provided for the education of the children. The
school can provide the much need education to the children. Also, women should be provided with the
good opportunities.

Vote of thanks
Mr. Dilip Sharma thanked all the people for sparing their time for this meeting and requested them to
continue their support towards the projects of Enercon India Limited. The representatives of the villages
and also the local population represented their happiness towards Enercon India Limited.
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                         CLEAN DEVELOPMENT MECHANISM
                     PROJECT DESIGN DOCUMENT FORM (CDM-PDD)
                          Version 03 - in effect as of: 28 July 2006

                                             CONTENTS

      A.      General description of project activity

      B.      Application of a baseline and monitoring methodology

      C.      Duration of the project activity / crediting period

      D.      Environmental impacts

      E.      Stakeholders’ comments

                                               Annexes

      Annex 1: Contact information on participants in the project activity

      Annex 2: Information regarding public funding

      Annex 3: Baseline information

      Annex 4: Monitoring plan

      Appendix 1: Location Map

      Appendix 2: Minutes of local stakeholder meeting
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SECTION A. General description of project activity

A.1     Title of the project activity:
>>
Title: Bundled wind energy power projects (2004 policy) in Rajasthan
Version: 1.0
Date of completion of PDD: 15 November 2006

A.2.    Description of the project activity:
>>
Objective of the Project

The objective is development, design, engineering, procurement, finance, construction, operation and
maintenance of bundled wind power projects totalling 24.8 MW wind power projects (“Project”) in the
Indian state of Rajasthan to provide reliable, renewable power to the Rajasthan state electricity grid which
is part of the Northern regional electricity grid. The Project will lead to reduced greenhouse gas
emissions because it displaces electricity from fossil fuel based electricity generation plants.

Nature of Project

The Project harnesses renewable resources in the region, and thereby displacing non-renewable natural
resources thereby ultimately leading to sustainable economic and environmental development. Enercon
(India) Ltd (“Enercon” or “EIL”) is the equipment supplier and the operations and maintenance contractor
for the Project. The generated electricity will be supplied to Rajasthan Rajya Vidyut Prasaran Nigam Ltd
(“RRPVN”)/ Jodhpur Electricity Distribution Company Ltd (“Jodhpur Discom”) under a long-term power
purchase agreement (PPA). The details of the sub-projects comprising the Project are as under:

•   CEPCO Industries: 12 MW
•   Ushdev International: 2.4 MW
•   Brindavan Agro Industies: 1.6 MW
•   Amrit Bottlers Ltd.: 0.8 MW
•   Deedee Enterprises: 0.8 MW
•   JN Investment: 0.8 MW
•   Metalfab Hightech Private Limited: 0.8 MW
•   SE Investment: 0.8 MW
•   Brindavan Bottlers Ltd.: 0.8 MW
•   Delta Enterprises: 2.4 MW
•   Sankalp International: 0.8 MW
•   Malani Impex Inc.: 0.8 MW

Contribution to sustainable development
The Project meets several sustainable development objectives including:
•   contribution towards the policy objectives of Government of India and Government of Rajasthan of
    incremental capacity from renewable sources;
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•    contribution towards meeting the electricity deficit in Rajasthan;
•    CO2 abatement and reduction of greenhouse gas emissions through development of renewable
     technology;
•    reducing the average emission intensity (SOx, NOx, PM, etc.), average effluent intensity and average
     solid waste intensity of power generation in the system;
•    conserving natural resources including land, forests, minerals, water and ecosystems; and
•    developing the local economy and create jobs and employment, particularly in rural areas, which is a
     priority concern for the Government of India;


A.3.    Project participants:
>>
Name of Party involved ((host)       Private and/or public                 Kindly indicate if the Party
indicates a host Party)              entity(ies) project participants      involved wishes to be
                                     (*) (as applicable)                   considered as project
                                                                           participant (Yes/No)
Government of India (Host)           Enercon (India) Ltd                   No
Government of Japan                  Japan Carbon Finance                  No

The contact details of the entities are provided in Annex – 1.

A.4.     Technical description of the project activity:

         A.4.1. Location of the project activity:
>>

                 A.4.1.1.         Host Party(ies):
>>
The host party to the project activity is the Government of India.

                 A.4.1.2.         Region/State/Province etc.:
>>
The Project is located in the State of Rajasthan that forms part of the Northern regional electricity grid of
India.

                 A.4.1.3.         City/Town/Community etc:
>>
The Project is located at Kita and Bhu village, in Jaisalmer District of Rajasthan state in India.

                A.4.1.4.        Detail of physical location, including information allowing the
unique identification of this project activity (maximum one page):
>>
The project area extends between latitude 26o 41’ & 26o 46.5’ North and longitude 70 o 57.5’ & 71 o 4’
East. The Project is connected to the RRVPN 33/132/220 kV substation at Amarsagar. The sites are
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located at a distance of 25 km from Jaisalmer by road. The nearest railway station is at Jaisalmer. A
location map is attached at Appendix – 1.

         A.4.2. Category(ies) of project activity:
>>
The project activity is considered under CDM category zero-emissions ‘grid-connected electricity
generation from renewable sources’ that generates electricity in excess of 15 MW (limit for small scale
project). Therefore as per the scope of the project activity enlisted in the ‘list of sectoral scopes and
related approved baseline and monitoring methodologies (version 02 Mar 05/07:23)’, the project activity
may principally be categorized in Scope Number 1, Sectoral Scope - Energy industries (renewable/ non-
renewable sources).

         A.4.3. Technology to be employed by the project activity:
>>
The Project involves 31 wind energy converters (WECs) of Enercon make (800 kW E-48) with internal
electrical lines connecting the Project with local evacuation facility. The WECs generates 3-phase power
at 400V, which is stepped up to 33 KV. The Project can operate in the frequency range of 47.5–51.5 Hz
and in the voltage range of 400 V ± 12.5%. The other salient features of the state-of-art-technology are:
• Gearless Construction - Rotor & Generator Mounted on same shaft eliminating the Gearbox.
• Variable speed function – has the speed range of 18 to 33 RPM thereby ensuring optimum efficiency
    at all times.
• Variable Pitch functions ensuring maximum energy capture.
• Near Unity Power Factor at all times.
• Minimum drawl (less than 1% of kWh generated) of Reactive Power from the grid.
• No voltage peaks at any time.
• Operating range of the WEC with voltage fluctuation of -20 to +20%.
• Less Wear & Tear since the system eliminates mechanical brake, which are not needed due to low
    speed generator which runs at maximum speed of 33 rpm and uses Air Brakes.
• Three Independent Braking System.
• Generator achieving rated output at only 33 rpm.
• Incorporates lightning protection system, which includes blades.
• Starts Generation of power at wind speed of 3 m/s.

Enercon (India) Ltd has secured and facilitated the technology transfer for wind based renewable energy
generation from Enercon GmbH, has established a manufacturing plant at Daman in India, where along
with other components the "Synchronous Generators" using "Vacuum Impregnation" technology are
manufactured.

         A.4.4   Estimated amount of emission reductions over the chosen crediting period:
>>
Crediting Period for the Project: fixed for 10 years

 Years                                                 Annual estimation of
                                                       emission reductions in
                                                       tonnes of CO2e
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 Years                                               Annual estimation of
                                                     emission reductions in
                                                     tonnes of CO2e
                       2008                                    44,207
                       2009                                    44,207
                       2010                                    44,207
                       2011                                    44,207
                       2012                                    44,207
                       2013                                    44,207
                       2014                                    44,207
                       2015                                    44,207
                       2016                                    44,207
                       2017                                    44,207
 Total estimated reductions (tonnes of CO2e)                  442,070
 Total number of crediting years                                 10
 Annual average over the crediting period of                   44,207
 estimated reductions (tonnes of CO2e)



         A.4.5. Public funding of the project activity:
>>
There is no ODA financing involved in the Project.

SECTION B. Application of a baseline and monitoring methodology


B.1.    Title and reference of the approved baseline and monitoring methodology applied to the
project activity:
>>
The approved consolidated baseline and monitoring methodology ACM0002 Version 6.0 (19 May 2006)
has been used. The titles of these baseline and monitoring methodologies are “Consolidated baseline
methodology for grid-connected electricity generation from renewable sources” and “Consolidated
monitoring methodology for grid-connected electricity generation from renewable sources.

B.2      Justification of the choice of the methodology and why it is applicable to the project
activity:
>>
The Project is wind based renewable energy source, zero emission power project connected to the
Rajasthan state grid, which forms part of the Northern regional electricity grid. The Project will displace
fossil fuel based electricity generation that would have otherwise been provided by the operation and
expansion of the fossil fuel based power plants in Northern regional electricity grid.
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The approved consolidated baseline and monitoring methodology ACM0002 Version 6 is the choice of
the baseline and monitoring methodology and it is applicable because:
• the Project is grid connected renewable power generation project activity
• the Project represents electricity capacity additions from wind sources
• the Project does not involve switching from fossil fuel to renewable energy at the site of project
    activity since the Project is green-field electricity generation capacities from wind sources at sites
    where there was no electricity generation source prior to the Project, and
• the geographical and system boundaries of the Northern electricity grid can be clearly identified and
    information on the characteristics of the grid is available.

B.3.   Description of the sources and gases included in the project boundary
>>
The project boundary encompasses the physical, geographical site of the Project sited at the Project
Location. It would include the wind turbine installations and sub-station up to the Metering Point.

According to ACM0002, for the baseline emission factor, the spatial extent of the project boundary
includes the project site and all power plants connected physically to the electricity system that the CDM
project power plant is connected to.

The Indian electricity system is divided into five regional grids, viz. Northern, Eastern, Western,
Southern, and North-Eastern. Each grid covers several states. As the regional grids are interconnected,
there is inter-state and inter-regional exchange. A small power exchange also takes place with
neighbouring countries like Bhutan and Nepal.

Power generation and supply within the regional grid is managed by Regional Load Dispatch Centre
(RLDC). The Regional Power Committees (RPCs) provide a common platform for discussion and
solution to the regional problems relating to the grid. Each state in a regional grid meets its demand with
its own generation facilities and also with allocation from power plants owned by the Central Sector such
as NTPC and NHPC etc. Specific quotas are allocated to each state from the Central Sector power plants.
Depending on the demand and generation, there are electricity exports and imports between states in the
regional grid. The regional grid thus represents the largest electricity grid where power plants can be
dispatched without significant constraints and thus, represents the “project electricity system” for the
Project. As the Project is connected to the Northern regional electricity grid, the Northern grid is the
“project electricity system”.

Grid connected captive power plants have not been included because adequate detail of data (for example,
fuel consumption) is not available. In addition, data on certain utility power plants was not available and
these were excluded from the project electricity system. Even though data on individual renewable
energy projects is not available, they have been included using appropriate assumptions.

           Source                          Gas      Included?      Justification/ Explanation
           Electricity generation from     CO2      Included       Main emission source
Baseline




           power plants connected to       CH4      Excluded       This source is not required to be
           the Northern Grid                                       estimated for wind energy projects
                                                                   under ACM0002
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                                             N2O      Excluded       This source is not required to be
                                                                     estimated for wind energy projects
                                                                     under ACM0002
            Electricity generation from      CO2      Excluded       Wind energy generation does not have
Activity
Project




            the Project                      CH4      Excluded       any direct GHG emissions.
                                             N2O      Excluded


B.4.    Description of how the baseline scenario is identified and description of the identified
baseline scenario:

>>
According to ACM0002, for project activities that do not modify or retrofit an existing electricity generation
facility, the baseline scenario is the following:

Electricity delivered to the grid by the project would have otherwise been generated by the operation of
grid-connected power plants and by the addition of new generation sources, as reflected in the combined
margin (CM) calculations described below.

As the Project does not modify or retrofit an existing generation facility, the baseline scenario is the
emissions generated by the operation of grid-connected power plants and by the addition of new
generation sources. This is estimated using calculation of Combined Margin multiplied by electricity
delivered to the grid by the Project.

B.5.    Description of how the anthropogenic emissions of GHG by sources are reduced below
those that would have occurred in the absence of the registered CDM project activity (assessment
and demonstration of additionality): >>

Step 0: Preliminary screening based on the starting date of the project activity
If project participants wish to have the crediting period starting prior to the registration of their project
activity, they shall:
a) Provide evidence that the starting date of the CDM project activity falls between 1 January 2000 and
   the date of the registration of a first CDM project activity, bearing in mind that only CDM project
   activities submitted for registration before 31 December 2005 may claim for a crediting period
   starting before the date of registration.
b) Provide evidence that the incentive from the CDM was seriously considered in the decision to
   proceed with the project activity. This evidence shall be based on (preferably official, legal and/or
   other corporate) documentation that was available at, or prior to, the start of the project activity.

The Project start date is prior to the date of validation of the PDD. Enercon had entered into discussions
with a CER purchaser for purchase of emission reductions and a Memorandum of Understanding was
signed on 1st July 2005, which is prior to the start date of the Project.

Step 1: Identification of alternatives to the project activity consistent with current laws and
regulations
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Sub-step 1a. Define alternatives to the project activity:
1. Identify realistic and credible alternative(s) available to the project participants or similar project
developers that provide outputs or services comparable with the proposed CDM project activity. These
alternatives are to include:
      The proposed project activity not undertaken as a CDM project activity;
      All other plausible and credible alternatives to the project activity that deliver outputs and on services
      (e.g. electricity, heat or cement) with comparable quality, properties and application areas;
      If applicable, continuation of the current situation (no project activity or other alternatives
      undertaken).
Alternative(s) available to the project participants or similar project developers include:
(a)     The Project is not undertaken as a CDM project activity.
(b)     Setting up of comparable utility scale fossil fuel fired or hydro power projects that supply to the
        Rajasthan grid under a PPA.
(c)     Continuation of the current situation where no project activity or any of the above Alternatives are
        undertaken would not be applicable as Rajasthan had energy (MU) shortages of 3.5% and peak
        (MW) shortages of 13.7% in 2005-06 (Source: Northern Region Power Sector Profile, July 2006,
        Ministry of Power).
Sub-step 1b. Enforcement of applicable laws and regulations
2. The alternative(s) shall be in compliance with all applicable legal and regulatory requirements, even
   if these laws and regulations have objectives other than GHG reductions, e.g. to mitigate local air
   pollution. This sub-step does not consider national and local policies that do not have legally-binding
   status.
3. If an alternative does not comply with all applicable legislation and regulations, then show that, based
   on an examination of current practice in the country or region in which the law or regulation applies,
   those applicable legal or regulatory requirements are systematically not enforced and that non-
   compliance with those requirements is widespread in the country. If this cannot be shown, then
   eliminate the alternative from further consideration.
4. If the proposed project activity is the only alternative amongst the ones considered by the project
   participants that is in compliance with all regulations with which there is general compliance, then the
   proposed CDM project activity is not additional.
There are no legal and regulatory requirements that prevent Alternatives (a) and (b) from occurring.

Proceed to Step 2 (Investment analysis) or Step 3 (Barrier analysis). (Project participants may also
select to complete both steps 2 and 3.)

Step 2: Investment Analysis
Determine whether the proposed project activity is the economically or financially less attractive than
other alternatives without the revenue from the sale of certified emission reductions (CERs). To conduct
the investment analysis, use the following sub-steps:
Sub-step 2a. - Determine appropriate analysis method
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1. Determine whether to apply simple cost analysis, investment comparison analysis or benchmark
   analysis (sub-step 2b). If the CDM project activity generates no financial or economic benefits other
   than CDM related income, then apply the simple cost analysis (Option I). Otherwise, use the
   investment comparison analysis (Option II) or the benchmark analysis (Option III).
Sub-step 2b. – Option I. Apply simple cost analysis
2. Document the costs associated with the CDM project activity and demonstrate that the activity
   produces no economic benefits other than CDM related income.
Sub-step 2b. – Option II. Apply investment comparison analysis
3. Identify the financial indicator, such as IRR, NPV, cost benefit ratio, or unit cost of service (e.g.,
   levelized cost of electricity production in $/kWh or levelized cost of delivered heat in $/GJ) most
   suitable for the project type and decision-making context.
Sub-step 2b. – Option III. Apply benchmark analysis
4. Identify the financial indicator, such as IRR, NPV, cost benefit ratio, or unit cost of service (e.g.,
   levelized cost of electricity production in $/kWh or levelized cost of delivered heat in $/GJ) most
   suitable for the project type and decision context.

Option I – Simple cost analysis is not applicable as the project activity sells electricity to the grid and
obtains economic benefits in the form of electricity tariffs.
Enercon proposes to use Option II – Investment comparison analysis and the financial indicator that is
identified is the post-tax return on equity or the equity IRR.
The post tax return on equity and equity IRR is used as the appropriate financial indicator because in the
Indian power sector, a 14% post tax return on equity is an established benchmark for projects in public or
private sector based on cost-plus regulations (Source: Central Electricity Regulatory Commission, Terms
and Conditions of Tariff, Regulations 2004 dated 26 March 2004) for utility scale power plants (similar to
Alternative (b)). Incentives, foreign exchange variations and efficiency in operations are in addition to
this benchmark of 14%.
For determining the tariffs for wind power projects, the electricity regulatory commissions of the state of
Rajasthan and Gujarat have considered the return on equity at 14% while the electricity regulatory
commissions of the state of Madhya Pradesh, Maharashtra and Karnataka have considered the return on
equity at 16%. (Source: RERC Order dated 29 September 2006).
There are some essential differences between the Project (whether implemented with or without CDM
revenues) and the Alternatives identified in Sub-step 1(b) (utility scale fossil fuel and hydro projects).
These should be taken into account while setting the appropriate level of equity IRR.

 •   The project activity tariff structure is a single-part tariff structure as compared to utility scale fossil
     fuel and hydro projects, which have two-part tariff structure. This implies that project activity
     carries a higher investment risk than the utility scale fossil fuel and hydro projects (Alternative (b))
     where the investment recovery is decoupled from the level of actual generation achieved by the
     project due to variations in offtake.
     Thus, in case of the project activity, issues such as transmission unavailability, back-down of
     generation or part-load operations, which are beyond the control of the investors are likely to affect
     the project activity more severely and therefore the project activity investors would require higher
     rate of return to compensate them for these additional risks.
 •   In case of utility scale fossil fuel and hydro projects (Alternative (b)), these are by reference to cost-
     plus approach whereby the projects recover their full investment cost each year if they are able to
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     reach specified level of plant availability. In case of the Project, it does not recover its full
     investment cost in the initial years as the tariffs are back-loaded. This increases the investment risks
     in the project activity compared to the alternatives.

Based on the above considerations, 16% post-tax equity IRR is considered to be the appropriate post-tax
equity return. If the Project has a post-tax equity IRR of less than 16%, then it can be considered to be
additional.

Sub-step 2c. Calculation and comparison of financial indicators (only applicable to options II and III):
5. Calculate the suitable financial indicator for the proposed CDM project activity and, in the case of
   Option II above, for the other alternatives. Include all relevant costs (including, for example, the
   investment cost, the operations and maintenance costs), and revenues (excluding CER revenues, but
   including subsidies/fiscal incentives where applicable), and, as appropriate, non-market cost and
   benefits in the case of public investors.
6. Present the investment analysis in a transparent manner and provide all the relevant assumptions in
   the CDM-PDD, so that a reader can reproduce the analysis and obtain the same results. Clearly
   present critical techno-economic parameters and assumptions (such as capital costs, fuel prices,
   lifetimes, and discount rate or cost of capital). Justify and/or cite assumptions in a manner that can be
   validated by the DOE. In calculating the financial indicator, the project’s risks can be included
   through the cash flow pattern, subject to project-specific expectations and assumptions (e.g. insurance
   premiums can be used in the calculation to reflect specific risk equivalents).
7. Assumptions and input data for the investment analysis shall not differ across the project activity and
   its alternatives, unless differences can be well substantiated.
8. Present in the CDM-PDD submitted for validation a clear comparison of the financial indicator for
   the proposed CDM activity and:
        (a)     The alternatives, if Option II (investment comparison analysis) is used. If one of the other
                alternatives has the best indicator (e.g. highest IRR), then the CDM project activity can
                not be considered as the most financially attractive;
        (b)     The financial benchmark, if Option III (benchmark analysis) is used. If the CDM project
                activity has a less favourable indicator (e.g. lower IRR) than the benchmark, then the
                CDM project activity cannot be considered as financially attractive.
The key assumptions used for calculating the benchmark (post-tax equity IRR) are set out below:


 Capacity of Machines in kW                                                800
 Number of Machines                                                         31
 Project Capacity in MW                                                  24.80
 Project Commissioning Date                                           1-Apr-06
 Project Cost per MW (Rs. In Millions)                                    47.5


 Operations
  Plant Load Factor - 1st to 5th year                                  22.00%
  Plant Load Factor - 6th to 9th year                                  21.73%
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  Plant Load Factor - 10th to 13th year                            21.45%
  Plant Load Factor - 14th to 17th year                            21.18%
  Plant Load Factor - 18th to 20th year                            20.90%
  Insurance Charges @ % of capital cost                             0.18%
  Operation & Maintanance Cost base year @ % of capital
                                                                   1.25%
cost
  % of escalation per annum on O & M Charges                        5.0%


Tariff
  Base year Tariff (2005-06) - Rs./Kwh                               3.25
  Annual Escalation (Rs./kWh per Year)                               0.06
  Tariff applicable from 2014-15 onwards (Rs/kWh)                    3.79


Project Cost                                                  Rs Million
Land and Infrastructure, Generator & Electrical Equipments,
Mechanical Equipments, Civil Works, Instrumentation &
Control, Other Project Cost, Pre operative Expenses, etc.
Total Project Cost                                                  1,178


Means of Finance                                                            Rs Million
Own Source                                                           30%          353
Term Loan                                                            70%          825
Total Source                                                                    1,178

Terms of Loan
  Interest Rate                                                    8.50%

  Tenure                                                      10            Years
  Moratorium                                                           6    Months



Income Tax Depreciation Rate (Written Down Value basis)
  on Wind Energy Generators                                          80%
  On other Assets                                                    10%

Book Depreciation Rate (Straight Line Method basis)
  On all assets                                                    7.86%
Book Depreciation up to (% of asset value)                           90%



Income Tax
  Income Tax rate                                                    30%
  Minimum Alternate Tax                                              10%
  Surcharge                                                          10%
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   Cess                                                                       2%

 Working capital
  Receivables (no of days)                                                     45
  O & m expenses (no of days)                                                  30
  Working capital interest rate                                              12%

 CER Revenues
  CER Price in US$                                                             -
   Exchange rate Rs./US$*
                                                                     45.34
 * RBI reference rate as of 15 November 2006


 Crediting period starts                                              1-Apr-07
 Length of Crediting period
                                                                     10

 Baseline Emission Factor for Northern Region (tCO2/GWh)                  924.96

The equity IRR for the Project without CDM revenues is 11.1% and with CDM revenues is 12.8%.

Sub-step 2d. Sensitivity analysis (only applicable to options II and III):
9. Include a sensitivity analysis that shows whether the conclusion regarding the financial attractiveness
   is robust to reasonable variations in the critical assumptions. The investment analysis provides a valid
   argument in favor of additionality only if it consistently supports (for a realistic range of assumptions)
   the conclusion that the project activity is unlikely to be the most financially attractive (as per step 2c
   para 8a) or is unlikely to be financially attractive (as per step 2c para 8b).
Sensitivity analysis of the Equity IRR to the Plant Load Factor (the most critical assumption) has been
carried out considering a plant load factor of 20% (plant load factor as observed in recent past for other
Enercon projects) and 23.97% (highest plant load factor achieved according to RERC, in its Order dated
29 September 2006). Plant Load Factor is the key variable encompassing variation in wind profile,
variation in off-take (including grid availability) including machine downtime. The post tax Equity IRRs
at the stated PLFs are as follows:


                                                PLF at 20%                          PLF at 23.97%
      Post tax Equity IRR without                   8.2%                               13.9%
      CER revenues
      Post tax Equity IRR with CER                  9.7%                               15.8%
      revenues


As can be seen from above, the Project is not the most financially attractive (as per step 2c para 8a) we
proceed to Step 4 (Common practice analysis).
Step 4. Common practice analysis
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Sub-step 4a. Analyze other activities similar to the proposed project activity:

1. Provide an analysis of any other activities implemented previously or currently underway that are
   similar to the proposed project activity. Projects are considered similar if they are in the same
   country/region and/or rely on a broadly similar technology, are of a similar scale, and take place in a
   comparable environment with respect to regulatory framework, investment climate, access to
   technology, access to financing, etc. Other CDM project activities are not to be included in this
   analysis. Provide quantitative information where relevant.

Sub-step 4b. Discuss any similar options that are occurring:

2. If similar activities are widely observed and commonly carried out, it calls into question the claim
   that the proposed project activity is financially unattractive (as contended in Step 2) or faces barriers
   (as contended in Step 3). Therefore, if similar activities are identified above, then it is necessary to
   demonstrate why the existence of these activities does not contradict the claim that the proposed
   project activity is financially unattractive or subject to barriers. This can be done by comparing the
   proposed project activity to the other similar activities, and pointing out and explaining essential
   distinctions between them that explain why the similar activities enjoyed certain benefits that
   rendered it financially attractive (e.g., subsidies or other financial flows) or did not face the barriers to
   which the proposed project activity is subject.
3. Essential distinctions may include a serious change in circumstances under which the proposed CDM
   project activity will be implemented when compared to circumstances under which similar projects
   where carried out. For example, new barriers may have arisen, or promotional policies may have
   ended, leading to a situation in which the proposed CDM project activity would not be implemented
   without the incentive provided by the CDM. The change must be fundamental and verifiable.

We analyze the extent to which wind energy projects have diffused in the electricity sector in Rajasthan.
In 2005 – 06, electricity generation from wind sources was 417 GWh which is expected to increase to 512
GWh in 2006 – 07. This works out to 1.35% of total generation available to the state of Rajasthan in
2005 – 06 and 1.66% of total expected generation available to the state of Rajasthan in 2006 – 07.
Clearly, electricity generation from wind is not a common practice in Rajasthan.

We analyze the wind energy projects in Rajasthan that have come under different policy regimes and in
different years. Briefly, the various policies have progressively decreased the electricity tariffs payable
by the offtaker (RRVPN/Discoms) and have progressively passed on burden of providing or paying for
transmission facilities. Below is the electricity tariff payable under different policies:

Electricity tariff (Rs/kWh)    1999-    2000-    2001-    2002-    2003-    2004-    2005-    2006-    2007-
                                00       01       02       03       04       05       06       07       08
1999 Policy                   2.89     3.03     3.18     3.34     3.51     3.69     3.87     4.06     4.27
2000 Policy                            3.03     3.18     3.34     3.51     3.68     3.87     4.06     4.26
2003 Policy                                                       3.32     3.39     3.45     3.52     3.59
2004 Policy (Original)                                                     2.91     2.96     3.01     3.06
2004 Policy (Amended)                                                               3.25     3.31     3.37


Out of the 279 MW installed up to 31 March 2005, the wind power projects under various policies of
Government of Rajasthan are set out below:
Policy 1999 (effective 11th March 1999): 4.25 MW
Policy 2000 (effective 4th Feb 2000): 82.23 MW
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Policy 2003 (effective 30th April 2003): 174.29 MW
Policy 2004 (effective 25th October 2004): 18.85 MW

Currently, there are 134.71 MW of wind projects in Rajasthan (at various stages) that are in the CDM
pipeline (on the cdm.unfccc.int website) out of 279 MW and more projects are expected to come into the
CDM pipeline.

With the revision of Policy 2004 (effective February 2006), the capacity additions during the three years
are expected to be around 297 MW:
2005–06: 74 MW
2006-07: 36 MW
2007-08: 187 MW

Out of the 297 MW that is estimated to be installed up to 2008, this Project constitutes 24.8 MW.
Enercon is further developing a 100 MW wind power project and another 60 MW as CDM project
activities under the 2004 policy (amended). It is expected that other wind power projects during this
period will be undertaken as CDM projects.

Clearly, wind power project development in Rajasthan is insignificant when compared to the power sector
of Rajasthan. Further, wind power project development is substantially dependent on CDM mechanism
and thus is not common practice.

Sub-steps 4a and 4b are satisfied.

Step 5. Impact of CDM registration

Explain how the approval and registration of the project activity as a CDM activity, and the attendant
benefits and incentives derived from the project activity, will alleviate the economic and financial hurdles
(Step 2) or other identified barriers (Step 3) and thus enable the project activity to be undertaken.

Registering the project activity as a CDM activity provides a significant amount of revenue, improving
the project’s cash flow and improving the equity IRR by 1.7%. The revenues from sale of the Certified
Emission Reductions would enhance the viability of the project and would partially offset the risks
associated with the possible changes in policy, wind regime, project implementation risks (time and cost
overruns), etc. Further, CER revenues will be high quality cash flows coming from creditworthy parties
and denominated in foreign currency. The CDM revenues will attract new players to wind investments in
Rajasthan, as they provide compensation for the regulatory and project risks implicit in the wind power
projects.

B.6.     Emission reductions:
         B.6.1. Explanation of methodological choices:
>>

According to the approved baseline methodology ACM0002, the emission reductions ERy by the project
activity during a given year “y1” is

1
  Throughout the document, the suffix y denotes that such parameter is a function of the year y, thus to be monitored at least
annually.
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ERy = BEy – PEy – Ly……………….(1)

where EGy is the electricity supplied to the grid, EFy is the CO2 emission factor of the grid and Ly is the
amount of emissions leakage resulting from the project activity.

Baseline Emissions for the amount of electricity supplied by project activity, BEy is calculated as

BEy = EGy * EFy …………………….(2)

where EGy is the electricity supplied to the grid, EFy is the CO2 emission factor of the grid as calculated
below.

The emission factor EFy of the grid is represented as a combination of the Operating Margin (OM) and
the Build Margin (BM). Considering the emission factors for these two margins as EFOM,y and EFBM,y,
then the EFy is given by:

EFy = wOM * EFOM,y + wBM * EFBM,y…………………………..(2)

with respective weight factors wOM and wBM (where wOM + wBM = 1).


The Operating Margin emission factor

As per ACM0002, dispatch data analysis should be the first methodological choice. However, this option
is not selected because the information required to calculate OM based on dispatch data is not available in
the public domain for the Northern electricity regional grid.

The Simple Operating Margin approach has been used to calculate the Operating Margin emission factor
applicable in this case. As per ACM 0002 the Simple OM method can only be used where low cost must
run resources constitute less than 50% of grid generation based on average of the five most recent years.
The generation profile of the Northern grid in the last five years is as follows:

 Generation in GWh                                      2004-05    2003-04    2002-03   2001-02       2000-01
 Low cost/must run sources
   Hydro                                                  36,128    38,279     30,335     29,129       29,020
   Wind                                                      332        15         25         19            6
   Nuclear                                                 7,503     7,380      8,800      8,158        6,669
 Other sources
   Coal                                                  106,156   103,232    100,362     96,882       92,417
   Diesel                                                      -         -          -         24            -
   Gas                                                    19,991    18,758     17,262     17,634       16,863
 Total Generation                                        170,109   167,663    156,785    151,845      144,975
 Low cost/must run sources                                43,962    45,674     39,160     37,305       35,695
 Low cost/must run sources                                  26%       27%        25%        25%          25%
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Source: Table 3.4 of CEA General Review 2004-05, 2003-04, 2002-03, 2001-02, 2000-01

From the available information it is clear that low cost/must run sources account for less than 50% of the
total generation in the Northern grid in the last five years. Hence the Simple OM method has been used to
calculate the Operating Margin Emission factor applicable.

Simple OM Method: The Simple OM emission factor EFOM,y is calculated as the generation-weighted
average emissions per electricity unit generated (tCO2/MWh) for all sources serving the Northern regional
grid, excluding zero- or low-operating cost power plants (hydro, wind and nuclear), using the following
equation:

EFOM,y = [∑i,j Fi,j,y * COEFi,j] / [∑j GENj,y]……………………..(3)

where Fi,j,y and COEFi,j are the fuel consumption and associated carbon coefficient of the fossil fuel i
consumed by power plant j in the grid in year(s) y. GENj,y is the electricity generation by power plant j
connected to the grid excluding zero- or low-operating cost sources in year(s) y.

As per ACM0002, the OM emission factor can be calculated using ex ante generation-weighted average
of the most recent 3 years for which data is available or using ex post generation data in the year in which
the project generation occurs. The OM emission factor is calculated using ex ante generation-weighted
average of the most recent 3 years and hence does not require yearly monitoring of the OM emission
factor.

For the purpose of determining the emission factor(s) for net electricity imports from a connected
electricity system within India, the following option has been used “(c) the average emission rate of the
exporting grid, if and only if net imports do not exceed 20% of total generation in the project electricity
system”. This has been done because the net imports to the Northern Grid from the connected electricity
system (Western, Eastern, North - Eastern and Southern regional electricity grids) do not exceed 20% and
it is not appropriate to use emissions of specific plants as it is not possible to identify specific plants from
which these imports take place.

The CO2 emission coefficient COEFi,j is obtained as:

COEFi,j = NCVi,j * EFCO2,i * OXIDi……………………………….(4)

where:

NCVi,j is the net calorific value (energy content) per mass or volume unit of a fuel i,

OXIDi is the oxidation factor of the fuel,

EFCO2,i is the CO2 emission factor per unit of energy of the fuel i.

Build Margin Emission Factor
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The Build Margin emission factor EF_BMy (tCO2/GWh) is given as the generation-weighted average
emission factor of the selected representative set of recent power plants represented by the 5 most recent
plants or the most recent 20% of the generating units built (summation is over such plants specified by k):

EFBM,y = [∑i Fi,m,y*COEFi] / [∑k GENk,m,y]………………………..(5)

The summation over i and k is for the fuels and electricity generation of the plants in sample m mentioned
above.

The choice of method for the sample plant is the most recent 20% of the generating units built as this
represents a significantly larger set of plants for a large regional electricity grid have a large number of
power plants connected to it and is therefore appropriate. The calculation of the net generation for 5 most
recent built and for the most recent 20% of the generation units built is shown in the calculation of Build
Margin in Annex – 3.

The Build Margin is calculated on ex ante based on the most recent information available on power plants
already built for sample group m at the time of the PDD preparation.

Combined Margin Emission Factor

As already mentioned, baseline emission factor (EFy) of the grid is calculated as a combined margin
(CM), calculated as the weighted average of the operating margin (OM) and build margin (BM) factor. In
case of wind power projects default weights of 0.75 for EFOM and 0.25 for EFBM are applicable as per
ACM0002. No alternate weights are proposed.

Using the above mentioned formulas for calculation of operating margin and build margin emission
factors and their respective weights for calculation of combined margin emission factor, the baseline
carbon emission factor (CM) is 924.96 tCO2e/GWh or 0.92496 tCO2e/MWh.

Project Emissions:

The project activity uses wind power to generate electricity and hence the emissions from the project
activity are taken as nil.

PEy = 0

Leakage:

Emissions Leakage on account of the project activity is ignored in accordance with ACM0002.

Ly = 0

         B.6.2. Data and parameters that are available at validation:
         >>

Data / Parameter:         Net Calorific Value of Coal, Furnace Oil, HSD, Light Oil, LSHS, Lignite
Data unit:                Terra Joules per 103 tons
Description:              The Net Calorific Value has been used for calculating the emission coefficients of fuels.
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Source of data used:          Data published in Table 1.3 of Central Electricity Authority (CEA) General Review of
                              Power Sector for 2004-05, 2003-04 and 2002-03 has been used for all fuels except for
                              HSD. Calorific value of HSD is taken from data published by CEA on petroleum fuels
                              used by GT and Diesel power plants in India in 2003-04.
Value applied:
                                                    2002-03 2003-04 2004-05
                               Coal                  17.46       15.99       15.72
                               Furnace oil           44.91       43.40       43.68
                               Light oil             40.86       42.65       43.00
                               LSHS/HHS/HS           44.06       43.13       43.64
                               D
                               Lignite               11.25       11.46       11.40
                               HSD                   42.71       42.71       42.71
Justification of the choice   As per ACM0002, wherever available, country specific Net Calorific Values should be
of data or description of     used for calculation. Accordingly the Net Calorific Value data published by the Central
measurement        methods    Electricity Authority, Ministry of Power, Govt. of India has been used.
and procedures actually       HSD Calorific values are not published in the CEA General Review, hence the value as
applied :                     per CEA data on petroleum fuels used by GT and Diesel power plants in India in 2003-
                              04 was used. This publication is only available for 2003-04 hence the 2003-04
                              Calorific value has been used for all three years i.e. 2002-03, 2003-04 and 2004-05.
Any comment:


Data / Parameter:             Net Calorific Value of Naphtha, Natural Gas
Data unit:                    Terra Joules per M.cum
Description:                  The Net Calorific Value has been used for calculating the emission coefficients of
                              Naphtha and Natural Gas.
Source of data used:          Data published by CEA on petroleum fuels used by GT and Diesel power plants in
                              India in 2003-04.
Value applied:
                                                  2002-03     2003-04     2004-05
                                 Natural Gas      34.12       34.12       34.12
                                 Naphtha          46.89       46.89       46.89
Justification of the choice
of data or description of     HSD Calorific values are not published in the CEA General Review, hence the value as
measurement        methods    per CEA data on petroleum fuels used by GT and Diesel power plants in India in 2003-
and procedures actually       04 was used. This publication is only available for 2003-04 hence the 2003-04
applied :                     Calorific value has been used for all three years i.e. 2002-03, 2003-04 and 2004-05.
Any comment:



Data / Parameter:             Carbon Emission Factor
Data unit:                    Tonnes Carbon per Terra Joule
Description:                  Carbon Emission Factor has been used for calculating the emission coefficients of
                              different fuel types
Source of data used:          In case of Coal and Lignite, Carbon Emission Factor as per India’s first National
                              Communication to the UNFCCC has been used.
                              For all other fuels, default values as per table 1-4 of Revised 1996 IPCC Guidelines for
                              National Greenhouse Gas Inventories: Workbook has been used.
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Value applied:
                               Coal                    26.13
                               Furnace oil             21.10
                               Light oil               20.00
                               LSHS/HHS/HSD            20.20
                               Lignite                 28.95
                               Natural Gas             15.30
                               Naphtha                 20.00
                               HSD                     20.20
Justification of the choice   As per ACM0002, wherever available, country specific values of Carbon Emission
of data or description of     Factors should be used for calculation. Accordingly the Emission Factors data as per
measurement        methods    India’s first National Communication to UNFCCC has been used in case of Coal and
and procedures actually       Lignite.
applied :                     Country specific Emission Factors for other fuel types are not available. Hence default
                              values as per the IPCC Guidelines have been used.
Any comment:


Data / Parameter:             Oxidation Factor
Data unit:                    Fraction of Carbon oxidised
Description:                  Oxidation Factor has been used for calculating the emission coefficients of different
                              fuel types
Source of data used:          Default values obtained from Table 1-6 of Revised 1996 IPCC Guidelines for National
                              Greenhouse Gas Inventories: Workbook
Value applied:
                               Coal                   0.98
                               Furnace oil            0.99
                               Light oil              0.99
                               LSHS/HHS               0.99
                               Lignite                0.98
                               Natural Gas            1.00
                               Naphtha                0.99
                               HSD                    0.99


Justification of the choice
of data or description of     Only IPCC default values are available.
measurement        methods
and procedures actually
applied :
Any comment:


Data / Parameter:             Fuel Density
Data unit:                    Kgs per Ltr or Kgs per Cu.m
Description:                  Fuel density of various fuels has been used for calculating the emissions of the
                              respective fuel types
Source of data used:
Value applied:                                        Density
                               Fuel                  (kg/Lt)
                               Coal                  1.00
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                               Furnace oil            0.93
                               Light oil              0.83
                               LSHS                   0.83
                               Lignite                1.00
                               Natural Gas            1.00
                               HSD                    0.83
                               Naphtha                0.76
Justification of the choice
of data or description of     Only IPCC default values are available
measurement        methods
and procedures actually
applied :
Any comment:


Data / Parameter:             Fuel consumption by Northern grid generating sources in 2004-05, 2003-04 and
                              2002-03
Data unit:                    ‘000’MT, KL, M Cu M
Description:                  Fuel consumption by generating sources have been used to calculate the total emissions
                              from electricity generation in the Northern grid during 2004-05, 2003-04 and 2002-03
Source of data used:          Table 6.1 CEA General Review of Power Sector 2004-05, 2003-04 and 2002-03
Value applied:                  Fuel                       Units          2002-03 2003-04 2004-05
                               Steam stations
                                 Coal                     '000' MT        68,594      70,085      72,943
                                 Furnace oil              KL              57,666      43,377      26,071
                                 Light oil                KL              60,211      254,855     94,208
                                 LSHS/HHS                 KL              32,761      2,377       3,126
                                 Lignite                  '000' MT        -           -           -
                               Gas Stations
                                 Natural Gas              M Cu M          3,953       3,808       4,058
                                 HSD                      KL              401,257     240,593     275,047
                                 Naphtha                  KL              -           188,981     243,961


Justification of the choice   The data source, i.e. Central Electricity Authority is a Government of India
of data or description of     organisation, which is mandated to publish such information under section 73 (i) and
measurement        methods    73(j) of the Indian Electricity Act 2003.
and procedures actually
applied :
Any comment:

Data / Parameter:             Imports from other regional grids into the Northern grid in 2002-03, 2003-04 and
                              2004-05
Data unit:                    GWh
Description:                  Electricity imports from other regional grids are used as an input into the calculation of
                              operating margin.
Source of data used:          Table 5.8 of CEA General Review of Power Sector for 2002-03, 2003-04 and 2004-05
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Value applied:
                               Net generation in GWh                    2004-05         2003-04           2002-03
                               Western Region                             374              175              43
                               Eastern Region                            3,043             125              827
                               Southern Region                            120
                               North-eastern Region                       172


Justification of the choice   The data source, i.e. Central Electricity Authority is a Government of India
of data or description of     organisation, which is mandated to publish such information under section 73 (i) and
measurement        methods    73(j) of the Indian Electricity Act 2003.
and procedures actually
applied :
Any comment:


Data / Parameter:             Average emission rate of regional grids in 2002-03, 2003-04 and 2004-05
Data unit:                    tCO2e/GWh
Description:                  Average emission rate of regional grids is used for calculating the emissions related to
                              import of electricity from other regional grids into the Northern grid, which is used as
                              an input for calculation of operating margin.
Source of data used:          Fuel Consumption: Table 6.1, CEA General Review for 2004-05, 2003-04 and 2002-03
                              Gross Electricity Generation: Table 3.4, CEA General Review for 2004-05, 2003-04
                              and 2002-03
                              Net Electricity Generation: Table 5.5, CEA General Review for 2004-05, 2003-04 and
                              2002-03
Value applied:                Refer Annex – 3

Justification of the choice   The data source, i.e. Central Electricity Authority is a Government of India
of data or description of     organisation, which is mandated to publish such information under section 73 (i) and
measurement        methods    73(j) of the Indian Electricity Act 2003.
and procedures actually
applied :
Any comment:



Data / Parameter:             Net electricity generation by fossil fuel fired power plants in the Northern grid in
                              2002-03, 2003-04 and 2004-05
Data unit:                    GWh
Description:                  Net electricity generation by fossil fuel fired power plants in the Northern grid has been
                              used to calculate the average emission intensity of electricity generated in the Northern
                              grid. This data is used as an input in the Operating margin emission factor calculation.
Source of data used:          Table 3.4 of CEA General Review of Power Sector for 2002-03, 2003-04 and 2004-05
Value applied:
                               Net generation in GWh             Steam         Gas
                                 2004-05                         96,404        19,516
                                 2003-04                         94,041        18,328
                                 2002-03                         91,523        16,852
Justification of the choice   The data source, i.e. Central Electricity Authority is a Government of India
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of data or description of     organisation, which is mandated to publish such information under section 73 (i) and
measurement      methods      73(j) of the Indian Electricity Act 2003.
and procedures actually
applied :
Any comment:


Data / Parameter:             Sample group of power plants added to the Northern grid in recent times,
Data unit:                    MW, GWh
Description:                  The sample group of new additions to the Northern grid comprising 20% of the grid’s
                              net generation during 2004-05 have been used for calculating the build margin emission
                              factor
Source of data used:          Table 2.8 of CEA General Review of Power Sector for 2004-05, 2003-04,2002-
                              03,2001-02,2000-01,1999-00,1998-99,1997-98,1996-97 and 1995-96
Value applied:
                              Refer Annex – 3
Justification of the choice
of data or description of     The data source, i.e. Central Electricity Authority is a Government of India
measurement        methods    organisation, which is mandated to publish such information under section 73 (i) and
and procedures actually       73(j) of the Indian Electricity Act 2003.
applied :
Any comment:


Data / Parameter:             Gross electricity generation during 2004-05 by power plants considered for Build
                              margin calculations.
Data unit:                    GWh
Description:                  Gross generation by the sample group of power plants has been used to arrive at the net
                              electricity supply by these power plants to the Northern grid.
Source of data used:          − Hydro Generation data obtained from CEA Performance Review of Hydro Power
                                   Stations 2004-05
                              − Steam Generation data obtained from Section 2, CEA Thermal Performance
                                   Review 2004-05
                              − Gas Generation data obtained from Section 10, CEA Thermal Performance Review
                                   2004-05
                              − Nuclear Generation data obtained from Nuclear Power Corporation of India’s
                                   website http://www.npcil.nic.in/raps.asp
                              − Wind generation data is obtained from Table 3.4, CEA General Review 2004-05
Value applied:                Refer Annex – 3
Justification of the choice   The data source, i.e. Central Electricity Authority is a Government of India
of data or description of     organisation, which is mandated to publish such information under section 73 (i) and
measurement        methods    73(j) of the Indian Electricity Act 2003.
and procedures actually       Many power generating stations in India house multiple generating units (both in case
applied :                     of Hydro and Thermal) and in many cases unit wise generation data is not published.
                              Therefore some times it is not possible to determine the actual amount of electricity
                              generated by a new unit that was added in recent times. In such cases pro-rata
                              generation, depending on capacity, has been used.
                              Plant wise generation for Nuclear power units is not available in the CEA publication.
                              Generation data reported for the Rajasthan Atomic Power station for 2004-05 on the
                              website       of     Nuclear       Power      Corporation      of    India    Limited,
                              http://www.npcil.nic.in/raps.asp, has been used.
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                              Similarly unit wise generation data of wind installations is also not available in the
                              public domain. In case of the northern region build margin sample plants, the earliest
                              plant i.e. GHTP Bhatinda-2 was commissioned on 18 October 1998, whereas the
                              earliest wind installation of northern region was commissioned in 1999-00 in Rajasthan.
                              Rajasthan is the only state in the northern region that has wind power installations.
                              Therefore electricity generation for all wind power projects in Rajasthan for 2004-05
                              has been considered for build margin calculations.
Any comment:


Data / Parameter:             Auxiliary consumption during 2004-05 by power plants considered for Build
                              margin calculations.
Data unit:                    GWh
Description:                  Auxiliary consumption by the sample group of power plants has been used to arrive at
                              the net electricity supply by these power plants to the Northern grid.
Source of data used:          − Auxiliary consumption for Hydro units is considered at 0.5% as per CERC norms
                                   applicable to Surface hydro electric power generating stations with static excitation
                                   system.
                              − Auxiliary consumption for Steam units taken from Section 11, CEA Thermal
                                   Performance Review 2004-05
                              − For Gas plants, the state average auxiliary consumption of Gas Power plants as per
                                   Table 5.5 CEA General Review 2004-05 has been used in the absence of plant
                                   specific auxiliary consumption data.
                              − Auxiliary Consumption for Nuclear Power Plants taken as the: State average for
                                   the respective generation type from Table 5.5 CEA General Review 2004-05
Value applied:                Refer Annex – 3
Justification of the choice   The data source, i.e. Central Electricity Authority is a Government of India
of data or description of     organisation, which is mandated to publish such information under section 73 (i) and
measurement        methods    73(j) of the Indian Electricity Act 2003.
and procedures actually       Actual auxiliary consumption of Hydro power units is not available in the CEA
applied :                     publications. Hence the auxiliary consumption norms set by Central Electricity
                              Regulatory Commission for determination of tariff for Hydro units has been used.
                              Nuclear power in India is generated by the Government owned Nuclear Power
                              Corporation of India Limited. Therefore the entire nuclear power generation pertains to
                              NPCL alone. Hence the state average auxiliary consumption for Nuclear power actually
                              refers to the auxiliary consumption rate achieved by the NPCL plant.
                              In case of Gas plants, plant wise data is not available. Hence the state averages (for the
                              respective fuel type) of auxiliary consumption have been applied.
                              Auxiliary consumption of wind considered as “Nil” as wind power generation does not
                              involve any auxiliary consumption. This is conservative.
Any comment:


Data / Parameter:             Average Emission Factor for Gas plants
Data unit:                    tCO2/GWh
Description:                  The Average emission factor for Gas plants is used as in input for calculation of build
                              margin emission factor
Source of data used:          CERC for tariff Regulations dated 24 March 2004
Value applied:
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                                                                                     Gas Combined
                                                                                     Cycle
                                                                                     (Advanced
                                                                                     class machines)
                               Gross Heat Rate (Kcal/KWh)                            1,850
                               Auxiliary Consumption                                 3.0%
                               Net Heat Rate                                         1,907

                               Net Calorific value of fuel (Kcal/SCM)                8,150
                               Net Calorific value of fuel (TJ/'000' Tons)           34.12

                               Specific Fuel Consumption (SCM/KWh)                   0.23

                               Carbon emission factor                                15.30
                               Oxidation factor                                      0.995
                               tCO2/'000' tons                                       1,905

                               Emission Coefficient (tCO2e/GWh)                      445.73

Justification of the choice   In the absence of any plant specific gas consumption information, the operating norms
of data or description of     set by CERC, for tariff determination of Gas power plants, has been considered for
measurement        methods    arriving at the applicable emission rates for gas plants included in the build margin
and procedures actually       calculations.
applied :
Any comment:


Data / Parameter:             Average Emission Factor for Coal plants
Data unit:                    tCO2/GWh
Description:                  The Average emission factor for Coal plants is used as in input for calculation of build
                              margin emission factor.
Source of data used:          CEA Thermal Performance Review 2004-05
Value applied:

                                                                                                       Emission
                                                                                                       Coefficient
                                                                                    Auxilia            (tCO2/        Specific
                                                    Coal                  Gross     ry        Net      1000          emissions
                               Coal/lignite fired   consum    Installed   generat   consum    Genera   tonnes of     (tCO2e/M
                               stations             ption     Capacity    ion       ption     tion     fuel)         Wh)
                                                    Million
                                                    Tonnes    MW          GWh       %         GWh
                               Northern Region
                               Rihand               4,768     1,000       7,988     7.93%     7,355    1,476         957
                               Suratgarh            5,920     1,250       9,362     9.22%     8,499    1,476         1,028
                               Kota                 5,213     1,045       7,749     9.62%     7,004    1,476         1,099
                               Unchahar             4,604     840         6,781     8.57%     6,200    1,476         1,096
                               Bhatinda             1,995     420         3,309     9.23%     3,004    1,476         980
                               Panipat              4,447     860         5,326     10.34%    4,775    1,476         1,375
Justification   of     the
choice of       data    or    The data source, i.e. Central Electricity Authority is a Government of India organisation,
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description          of   which is mandated to publish such information under section 73 (i) and 73(j) of the Indian
measurement    methods    Electricity Act 2003.
and procedures actually
applied :
Any comment:


       B.6.3 Ex-ante calculation of emission reductions:
       >>
Ex-ante calculation of emission reductions is equal to ex-ante calculation of baseline emissions as project
emissions and leakage are nil.

Baseline emission factor (combined margin)
= 924.96 tCO2e/GWh
Annual electricity supplied to the grid by the Project
= 24.8 MW (Capacity) x 22% (PLF) x 8760 (hours) / 1000 GWh
= 47.794 GWh

Annual baseline emissions
= 924.96 tCO2e/GWh x 47.794 GWh
= 44,207 tCO2e

        B.6.4    Summary of the ex-ante estimation of emission reductions:
        >>
 Year               Estimation of          Estimation of         Estimation       Estimation of
                    project activity       baseline              of leakage       overall emission
                    emissions (tonnes      emissions             (tonnes of       reductions (tonnes
                    of CO2e)               (tonnes of CO2e)      CO2e)            of CO2e)
        2008                           0 44,207                               0 44,207
        2009                           0 44,207                               0 44,207
        2010                           0 44,207                               0 44,207
        2011                           0 44,207                               0 44,207
        2012                           0 44,207                               0 44,207
        2013                           0 44,207                               0 44,207
        2014                           0 44,207                               0 44,207
        2015                           0 44,207                               0 44,207
        2016                           0 44,207                               0 44,207
        2017                           0 44,207                               0 44,207
 Total (tonnes                         0 442,070                              0 442,070
 of CO2e)



B.7      Application of the monitoring methodology and description of the monitoring plan:
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       B.7.1   Data and parameters monitored:

Data / Parameter:        EGy
Data unit:               MWh (Mega-watt hour)
Description:             Net electricity supplied to the grid by the Project
Source of data to be     Electricity supplied to the grid as per the tariff invoices raised on
used:                    RRVPNL/Jodhpur Discom.
Value of data applied    Annual electricity supplied to the grid by the Project
for the purpose of       = 24.8 MW (Capacity) x 22% (PLF) x 8760 (hours) GWh
calculating  expected    = 47,794 MWh
emission reductions in
section B.5
Description         of   Net electricity supplied to grid will be measured by main meters (export and
measurement methods      import). The procedures for metering and meter reading will be as per the
and procedures to be     provisions of the power purchase agreement and the Metering Code of Rajasthan.
applied:                 Refer Annex – 4 for an illustration of the provisions for measurement methods.
QA/QC procedures to      QA/QC procedures will be as implemented by RRVPN/Jodhpur Discom pursuant
be applied:              to the provisions of the power purchase agreement and the Metering Code of
                         Rajasthan and there will be no additional QA/QC procedures. Refer Annex – 4
                         for an illustration of the provisions for QA/QC procedures.
Any comment:

       B.7.2 Description of the monitoring plan:
>>
Approved monitoring methodology ACM0002 / Version 06 Sectoral Scope: 1, “Consolidated monitoring
methodology for zero-emissions grid-connected electricity generation from renewable sources”, by CDM
- Meth Panel is proposed to be used to monitor the emission reductions.

This approved monitoring methodology requires monitoring of the following:
• Electricity generation from the project activity; and
• Operating margin emission factor and build margin emission factor of the grid, where ex post
    determination of grid emission factor has been chosen
Since the baseline methodology is based on ex ante determination of the baseline, the monitoring of
operating margin emission factor and build margin emission factor is not required.

The sole parameter for monitoring is the electricity supplied to the grid. The Project is operated and
managed by Enercon (India) Ltd. The operational and management structure implemented by Enercon is
as follows:
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      STRUCTUR                     RESPONSIBILITY

Managing Director
Enercon India Ltd


      CDM Team                   Review, Corrective action
      co-ordinator


      Corporate                  Review, internal
      CDM Team


   Regional Service              Check, authorize & forward
       Heads                     monitoring data


      O&M Team                   Monitor, record, report and
                                 archive data




B.8     Date of completion of the application of the baseline study and monitoring methodology and
the name of the responsible person(s)/entity(ies)
>>
Date of completion: 15/11/2006

Name of responsible person/entity:
PricewaterhouseCoopers (not a Project Participant)

SECTION C. Duration of the project activity / crediting period

C.1     Duration of the project activity:

        C.1.1. Starting date of the project activity:
>>
24/11/2005 being the date of placement of purchase order for the first project in the bundle.

        C.1.2. Expected operational lifetime of the project activity:
>>
20 years
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C.2     Choice of the crediting period and related information:

        C.2.1. Renewable crediting period

                C.2.1.1.         Starting date of the first crediting period:
>>

                C.2.1.2.         Length of the first crediting period:
>>

        C.2.2. Fixed crediting period:

                C.2.2.1.         Starting date:
>>
1/04/2007, being the expected date of registration of Project.

                C.2.2.2.         Length:
>>
10 years

SECTION D. Environmental impacts
>>

D.1.    Documentation on the analysis of the environmental impacts, including transboundary
impacts:
>>
Enercon appointed Aditya Environmental Services Private Limited to conduct rapid environmental
impact assessment study to assess the impact of the project on the local environment.

Environmental Impact Assessment (EIA) of this project is not an essential regulatory requirement, as it is
not covered under the categories as described in EIA Notification of 1994 or the Amended Notification of
2006. However, Enercon conducted the EIA to study impacts on the environment resulting from the
project activity.

The EIA study included identification, prediction and evaluation of potential impacts of the CDM
activities on air, water, noise, land, biological and socioeconomic environment within the study area. The
ambient air concentrations of Suspended Particulate Matter, Respirable Particulate Matter, Oxides of
Nitrogen, Sulphur dioxide and Carbon Monoxide were monitored and were found under limits as
specified by CPCB. The noise levels were observed through out the study period and were found to be in
the permissible range. Water quality monitoring studies were carried out for determination of physico-
chemical characteristics of bore wells. The ph level of water was found to be under the specified limits.

The study area represents part of Jaisalmer district, which is part of the Thar desert. The terrain is rough
comprising sandy or stony wasteland & is very sparsely populated. The windfarm is located in the mist of
the Indian ‘Thar’ Desert and does not come in the path of the migratory birds. There is no wild life or
forestland near the project sites.
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D.2.    If environmental impacts are considered significant by the project participants or the host
Party, please provide conclusions and all references to support documentation of an environmental
impact assessment undertaken in accordance with the procedures as required by the host Party:
>>
EIA demonstrated that there is no major impact on the environment due to the installation and operation
of the windmills. The desert ecology is not likely to get impacted by this type of project activity. The
local population confirmed that there is no noise or dust nuisance due to windmills. The EIA also ruled
out any adverse impacts due to the project activity.

SECTION E. Stakeholders’ comments
>>

E.1.   Brief description how comments by local stakeholders have been invited and compiled:
>>
The comments from local stakeholders were invited through a local stakeholder meeting conducted at
Gorbandh Palace, Jaisalmer on 18 September 2006. A local newspaper advertisement was placed in
Rajasthan Patrica on 5th September 2006 inviting the local stakeholders for the meeting.

The local stakeholder consultation meeting had representatives from the nearby villages, representatives
of Enercon and representative of Aditya Environmental Services (consultant to Enercon). The minutes of
the meeting are set out in Appendix 2.

E.2.   Summary of the comments received:
>>
The comments from local villagers included:
 • The nature of benefits that local stakeholders will get
 • Impact on the grazing of local cattle
 • Impact on any migratory patterns of birds or fauna
 • Impact on water availability; distance of the tube wells from the Project site
 • Addressing safety issues by Enercon, incidence of accidents
 • Noise disturbance
 • Provision of a school for education of children
 • Provision of opportunities for women

E.3.    Report on how due account was taken of any comments received:
>>
Enercon provided the following responses in relation to the comments received from the local
stakeholders:
• The benefits to the local stakeholders will be through employment opportunities provided by the
    project in terms of small shops and construction workers. It will also lead to better connectivity to
    nearby towns.
• The project does not affect the grazing by the cattle. Enercon does not use any kind for boundary wall
    to protect their machines and hence the accessibility of cattle to areas for grazing and drinking water
    is not affected.
• The Project does not fall under migratory patterns of the birds.
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•   Project has improved the availability of water, which can also be accessed from project site. The tube
    wells are located at a distance of 3 Km from project site which the people daily access.
•   Enercon has appropriate protocols are in place to take care of all the safety issues. No incidence of
    accident has occurred.
•   No noise disturbances have been observed so far and local inhabitation is far away from the project
    site.
•   A school was reconstructed by Enercon India Limited in police lane in Jaisalmer, Rajasthan in 2004 –
    05. Enercon will bear in mind the requirement of school in the village and opportunities for women
    in the village when it undertakes further developmental work.

The local stakeholders were satisfied with the explanations provided during the meeting.
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                                                Annex 1

       CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY

Organization:            Enercon (India) Limited
Street/P.O.Box:          Kolsite House, Plot No. 31, Shah Industrial Estate, Veera Desai Road, Andheri
                         (West)
Building:
City:                    Mumbai
State/Region:            Maharashtra
Postfix/ZIP:             400 053
Country:                 India
Telephone:                +91-22-5522 7794
FAX:                      +91-22-5692 1175
E-Mail:                  a.raghavan@enerconindia.net
URL:
Represented by:
Title:                   Associate Vice President
Salutation:              Mr.
Last Name:               Raghavan
Middle Name:
First Name:              A
Department:              Corporate
Mobile:                  +91-98200 45724
Direct FAX:              +91-22-5692 1175
Direct tel:              +91-22-5522 7794
Personal E-Mail:         a.raghavan@enerconindia.net

Organization:            Japan Carbon Finance, Ltd.
Street/P.O.Box:          6th Floor, 1-3 Kundankita, 4-chrome
Building:                Chiyoda-ku
City:                    Tokyo
State/Region:
Postfix/ZIP:             102-0073
Country:                 Japan
Telephone:               +81 3 5212 8870
FAX:                     +81 3 5212 8886
E-Mail:                  jcf@jcarbon.co.jp
URL:                     http://www.japancarbon.co.jp/
Represented by:
Title:                   Director General
Salutation:              Mr.
Last Name:               Ari
Middle Name:
First Name:              Masato
Department:              Carbon Finance Department
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Mobile:
Direct FAX:              +81 3 5212 8886
Direct tel:              +81 3 5212 8878
Personal E-Mail:         m-ari@jcarbon.co.jp
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                                      Annex 2

                    INFORMATION REGARDING PUBLIC FUNDING
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                                          Annex 3

                                BASELINE INFORMATION

                                    Emission Coefficients

       2004-2005
                                                        Fraction of     Emission
                        Net Calorific     Carbon
                                                         Carbon        Coefficient
                        Value (TJ/ 103    Emission
     Type of FUEL                                        Oxidised      (tCO2/ 103
                          tonnes or      Factor (t C/
                                                        Oxidation       tonnes or
                         TJ/Mcum)           TJ )
                                                          Factor      tCO2/Mcum)
 Steam stations
   Coal                     15.72           26.13           0.98         1,476
   Furnace oil              43.68           21.10           0.99         3,346
   Light oil                43.00           20.00           0.99         3,122
   LSHS/HHS/HSD             43.64           20.20           0.99         3,200
   GAS                      34.12           15.30           1.00         1,905
   Lignite                  11.40           28.95           0.98         1,186
 Gas Stations
   Natural Gas              34.12           15.30           1.00         1,905
   HSD                      42.71           20.20           0.99         3,131
   Naphtha                  46.89           20.00           0.99         3,404
 Diesel Stations
   LSHS                     43.64           20.20           0.99         3,200
   Diesel                   43.00           20.20           0.99         3,153


       2003-2004
                                                        Fraction of     Emission
                        Net Calorific     Carbon
                                                         Carbon        Coefficient
                        Value (TJ/ 103    Emission
     Type of FUEL                                        Oxidised      (tCO2/ 103
                          tonnes or      Factor (t C/
                                                        Oxidation       tonnes or
                         TJ/Mcum)           TJ )
                                                          Factor      tCO2/Mcum)
 Steam stations
   Coal                     15.99           26.13           0.98         1,502
   Furnace oil              43.40           21.10           0.99         3,324
   Light oil                42.65           20.00           0.99         3,096
   LSHS/HHS/HSD             43.13           20.20           0.99         3,163
   GAS                      34.12           15.30           1.00         1,905
   Lignite                  11.46           28.95           0.98         1,192
 Gas Stations
   Natural Gas              34.12           15.30           1.00         1,905
   HSD                      42.71           20.20           0.99         3,131
   Naphtha                  46.89           20.00           0.99         3,404
 Diesel Stations
   LSHS                     43.13           20.20           0.99         3,163
   Diesel                   42.65           20.20           0.99         3,127
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       2002-2003
                                                        Fraction of     Emission
                        Net Calorific     Carbon
                                                         Carbon        Coefficient
                        Value (TJ/ 103    Emission
     Type of FUEL                                        Oxidised      (tCO2/ 103
                          tonnes or      Factor (t C/
                                                        Oxidation       tonnes or
                         TJ/Mcum)           TJ )
                                                          Factor      tCO2/Mcum)
 Steam stations
   Coal                     17.46           26.13          0.98          1,640
   Furnace oil              44.91           21.10          0.99          3,440
   Light oil                40.86           20.00          0.99          2,967
   LSHS/HHS/HSD             44.06           20.20          0.99          3,231
   GAS                      34.12           15.30          1.00          1,905
   Lignite                  11.25           28.95          0.98          1,170
 Gas Stations
   Natural Gas              34.12           15.30          1.00          1,905
   HSD                      42.71           20.20          0.99          3,131
   Naphtha                  46.89           20.00          0.99          3,404
 Diesel Stations
   LSHS                     44.06           20.20          0.99          3,231
   Diesel                   40.86           20.20          0.99          2,996
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                                   Operating Margin for Northern Region

Fuel                     Units                    2004-05                          2003-04                         2002-03
                                       Fuel             Emissions          Fuel          Emissions          Fuel         Emissions
                                   consumption           (tCO2)        consumption        (tCO2)        consumption       (tCO2)
  Steam stations
    Coal                '000' MT         72,943        107,674,458        70,085        105,246,478       68,594        112,472,267
    Furnace oil            KL            26,071           81,119          43,377          134,086         57,666          184,464
    Light oil              KL            94,208          243,211         254,855          652,561         60,211          147,724
    LSHS/HHS/HSD           KL             3,126            8,272           2,377           6,217          32,761           87,535
    GAS                    MT               -                -               -               -               -                -
    Lignite             '000' MT            -                -               -               -               -                -
  Gas Stations
    Natural Gas          M Cu M        4,058            7,729,258         3,808          7,253,084         3,953         7,529,265
    HSD                    KL         275,047            712,283         240,593          623,059         401,257        1,039,127
    Naphtha                KL         243,961            631,206         188,981          488,955            -               -
  Diesel Stations
    LSHS                  KL             -                  -               -                -               -               -
    Diesel                KL             -                  -               -                -               -               -
                                     Electricity        Emissions       Electricity      Emissions       Electricity     Emissions
                         Units
Grid imports                           import            (tCO2)           import          (tCO2)           import         (tCO2)
  From region
    Western Region        GWh      374                      345,000        175               164,242         43              51,472
    Eastern Region        GWh      3,043                3,375,957          125               144,143        827          1,050,177
    Southern Region       GWh      120                    97,941
    North-eastern
Region                    GWh      172                      55,058
Total emissions                          3,709         120,953,763                      114,712,824                     122,562,031

Net electricity
                         Units                              2004-05                          2003-04                         2002-03
generation
  Steam stations          GWh                               96,404                           94,041                          91,523
  Gas stations            GWh                               19,516                           18,328                          16,852
  Diesel stations         GWh
Grid imports              GWh                                3,709                             301                             870
Total                     GWh                               119,630                          112,669                         109,245


                         Units                              2004-05                          2003-04                         2002-03
Operating Margin        tCO2/GWh                            1,011.07                         1,018.14                        1,121.90
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                                     Average Emission Rate of Western Grid

             Fuel          Units                 2004-05                         2003-04                     2002-03
                                                     Emissions                       Emissions                   Emissions
                                        Cons                            Cons                        Cons
                                                      (tCO2)                          (tCO2)                      (tCO2)
 Steam stations

   Coal                   '000' MT      94,123       138,939,213        89,075       133,763,716    91,350       149,784,844

   Furnace oil              KL         1,066,231      3,317,529        1,187,213      3,669,883    135,786        434,357

   Light oil                KL          10,028         25,889           10,685         27,359       46,383        113,798

   LSHS/HHS/HSD             KL         574,238        1,519,604        423,797        1,108,473    2,006,346      5,360,834

   GAS                      MT          39,012         74,306           33,884         64,539      204,166        388,874

   Lignite                '000' MT      2,609         3,095,348         2,560         3,051,709     19,311       22,591,188
 Gas Stations

   Natural Gas            M Cu M        4,667         8,889,218         3,721         7,087,375     3,505         6,675,961

   HSD                      KL          1,625              4,208        2,767              7,166   697,009        1,805,029

   Naphtha                  KL         776,908        2,010,111        1,082,436      2,800,610    426,280        1,102,924
 Diesel Stations

   LSHS                     KL             -                       -                         -         -               -

   Diesel                   KL             -                       -                         -         -               -



             Total                                   157,875,426                     151,580,830                 188,257,809



 Net Grid Generations      GWh                         171,027                        161,528                     158,333

 Average Emission         tCO2e/G
 Rate                       Wh                         923.10                          938.42                     1,189.00
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                                      Average Emission Rate of Eastern Grid

                Fuel          Units              2004-05                   2003-04                   2002-03
                                                     Emissions                 Emissions                 Emissions
                                          Cons                      Cons                      Cons
                                                      (tCO2)                    (tCO2)                    (tCO2)
Steam stations
    Coal                     '000' MT      58,372    86,165,546      53,212    79,908,334     45,146     74,025,031
    Furnace oil                KL          54,976      171,055       78,230       241,823     52,510        167,971
    Light oil                  KL         121,186      312,858      170,917       437,636     98,608        241,928
    LSHS/HHS/HSD               KL                -             -           -             -        -                -
    GAS                        MT                -             -           -             -        -                -
    Lignite                  '000' MT            -             -           -             -           -             -
Gas Stations
    Natural Gas               M Cu M             -             -           -             -        -                -
    HSD                        KL                -             -      2,596           6,723    3,423            8,864
    Naphtha                    KL                -             -           -             -        -                -
Diesel Stations
    LSHS                       KL            219             580           -             -        -                -
    Diesel                     KL          29,880          77,911    38,881      100,551      14,847           36,790


              Total                                  86,727,950                80,695,067                74,480,585


Net Grid Generations           GWh                         78,164                    70,253                    58,652


Average Emission Rate       tCO2e/GWh                  1,109.57                  1,148.64                  1,269.86
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                              Average Emission Rate of North – Eastern Grid

              Fuel            Units             2004-05                2003-04                2002-03
                                                  Emissions              Emissions              Emissions
                                        Cons                   Cons                   Cons
                                                   (tCO2)                 (tCO2)                 (tCO2)
Steam stations
  Coal                       '000' MT
  Furnace oil                  KL
  Light oil                    KL
  LSHS/HHS/HSD                 KL
  GAS                          MT
  Lignite                    '000' MT
Gas Stations

  Natural Gas                M Cu M     1,309      2,493,248   1,246      2,373,252   930        1,771,368
  HSD                          KL
  Naphtha                      KL
Diesel Stations
  LSHS                         KL

  Diesel                       KL       353          920       3,431       8,873      4,948       12,261



              Total                                2,494,168              2,382,125              1,783,629



Net Grid Generations          GWh                   7,814                  6,569                  5,308



Average Emission Rate       tCO2e/GWh               319.20                 362.63                 336.05
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                                 Average Emission Rate of Southern Grid

              Fuel            Units              2004-05                      2003-04                   2002-03

                                                    Emissions                    Emissions                    Emissions
                                         Cons                         Cons                      Cons
                                                     (tCO2)                       (tCO2)                       (tCO2)
Steam stations

  Coal                        000MT     53,144      78,448,259       52,985      79,567,449    65,997        108,214,016

  Furnace oil                  KL       45,848       142,654         56,498       174,645      115,914         370,790

  Light oil                    KL       24,330        62,811         33,031        84,577       8,407          20,626

  LSHS/HHS/HSD                 KL        2,612         6,912          5,310        13,889       6,093          16,280
  GAS                          KL                                -

 Lignite                      000MT     22,121      26,244,612       20,755      24,741,489    17,738         20,750,996
Gas Stations

  Natural Gas                 M Cu M     2,203       4,196,046        2,010       3,828,440     3,130         5,961,700

  HSD                          KL       81,254       210,422         226,981      587,808      275,122         712,478

  Naphtha                      KL       289,451      748,903         719,694      1,862,080    485,496        1,256,134
Diesel Stations

  LSHS                         KL       465,220      1,231,110       647,451      1,693,457             -                 -

  Diesel                       KL       63,039       164,371         14,903        38,541      865,938        2,145,766

              Total                                 111,456,100                  112,592,373                 139,448,786


Net Grid Generations           GWh                   137,025                      129,865                      125,830



Average Emission Rate       tCO2e/GWh                 813.40                       867.00                      1,108.23
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                             Build Margin Emission Factor for Northern Grid

                                            Date of    Gross     Aux      Net supply   Emission factor     Total
    Name of the plant            State
                                            addition    Gen      Cons      to grid      (tCO2/GWh)         tCO2
                                                       GWh        %         GWh         (for 2004-05)

Hydro
  Nathpa Jhakri HEP - 1     Himachal     31-Mar-04        852    0.50%          847
  Nathpa Jhakri HEP - 2     Himachal     9-Mar-04         852    0.50%          847
  Chamera HEP II - 3        Himachal     26-Feb-04        449    0.50%           447
  Nathpa Jhakri HEP - 3     Himachal     13-Feb-04        852    0.50%           847
  Nathpa Jhakri HEP - 4     Himachal     22-Jan-04        852    0.50%           847
  Chamera HEP II - 2        Himachal     5-Dec-03         449    0.50%           447
  Nathpa Jhakri HEP - 5     Himachal     23-Nov-03        852    0.50%          847
  Chamera HEP II - 1        Himachal     4-Nov-03         449    0.50%           447
  Nathpa Jhakri HEP - 6     Himachal     20-Sep-03        852    0.50%           847
  Baspa -II - 3             Himachal     27-May-03        398    0.50%           396
  Baspa -II - 2             Himachal     8-Feb-03         398    0.50%           396
  Baspa -II - 1             Himachal     24-Jan-03        398    0.50%           396
  Upper Sindh II - 2        JK           29-Mar-02         49    0.50%            49
  Sewa III - 3              JK           19-Mar-02           3   0.50%             3
  Sewa III - 1              JK           18-Mar-02           3   0.50%             3
  Sewa III - 2              JK           18-Mar-02           3   0.50%             3
  Upper Sindh II - 1        JK           11-Sep-01         49    0.50%            49
  Malana - 2                Himachal     9-Jul-01         134    0.50%           133
  Malana - 1                Himachal     5-Jul-01         134    0.50%           133
  Ghanvi - 1                Himachal     7-Dec-00          37    0.50%            37
  Ranjait Sagar - 3         Punjab       11-Oct-00        286    0.50%           285
  Ranjait Sagar - 4         Punjab       16-Sep-00        286    0.50%          285
  Ranjait Sagar - 2         Punjab       20-Aug-00        286    0.50%          285
  Ranjait Sagar - 1         Punjab       12-Aug-00        286    0.50%          285
  Chenani III - 1           JK           31-Jul-00           6   0.50%             6
  Chenani III - 2           JK           31-Jul-00           6   0.50%             6
  Chenani III - 3           JK           31-Jul-00           6   0.50%             6
  Ghanvi - 2                Himachal     30-Jul-00         37    0.50%            37
  Upper Sind II - 3         JK           5-Jan-00          49    0.50%            49
Steam
  Kota TPS IV - 6           Rajasthan    30-Jul-03      1,470    9.62%         1,329              1,099   1,459,784
  Suratgarh III - 5         Rajasthan    30-Jun-03      1,955    9.22%         1,775              1,028   1,824,857
  Suratgarh TPS - 4         Rajasthan    25-Mar-02      1,951    9.22%         1,771              1,028   1,821,124
  Suratgarh TPS - 3         Rajasthan    29-Oct-01      1,876    9.22%         1,703              1,028   1,751,116
  Panipat TPS St IV - 6     Haryana      31-Mar-01      1,482    10.34%        1,329              1,375   1,826,599
  Suratgarh - 2             Rajsthan     28-Mar-00      1,704    9.22%         1,547              1,028   1,590,566
  Unchahar TPP - 4          UP           22-Oct-99      1,748    8.57%         1,598              1,096   1,751,911
  Unchahar TPP - 3          UP           27-Jan-99      1,690    8.57%         1,545              1,096   1,693,781
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                                             Date of       Gross      Aux     Net supply    Emission factor     Total
      Name of the plant          State
                                             addition       Gen       Cons     to grid       (tCO2/GWh)         tCO2
                                                            GWh         %       GWh          (for 2004-05)

    GHTP Bhatinda - 2         Punjab      16-Oct-98          1,536   11.24%        1,363                980    1,336,723
Wind
   All wind power projects
in the region                 Rajasthan   31-Mar-05           332     0.00%          332
Gas
    Pragati CCGT - 3          Delhi       31-Jan-03            936    2.34%          914                446     407,293
    Pragati CCGT - 2          Delhi       9-Nov-02             808    2.34%          789                446     351,509
    Ramgarh CCGT Stg II -
2                             Rajasthan   24-Aug-02           120     7.21%          111                446      49,447
    Ramgarh CCGT Stg II -
1                             Rajasthan   7-Aug-02            119     7.21%          110                446      49,054
    Pragati CCGT - 1          Delhi       15-Mar-02            808    2.34%          789                446     351,509
    Faridabad CCGT            Haryana     31-Jul-00          1,059    2.28%        1,035                446     461,205
    Faridabad CCGT - 2        Haryana     18-Oct-99          1,052    2.28%        1,028                446     458,002
    Faridabad CCGT - 1        Haryana     28-Jun-99          1,052    2.28%        1,028                446     458,002
Nuclear
    Rajasthan Atomic PP - 4   Rajasthan   23-Dec-00          1,649   10.50%        1,476
    Rajasthan APS - 3         Rajasthan   10-Mar-00          1,470   10.50%        1,316
Total                                                       34,125                32,150                      17,642,481



Test of Build Margin Sampling
Net Generation from five most recent plants                                      3,836     GWh
                                                                                   Net
Total Net Electricity Generation for NR grid (2004-05)                         158,836     GWh
Total Net Electricity Generation from power plants added to the
system                                                                          32,150     GWh
                                            of the total grid generation       20.24%

Therefore the power plants as per table above have been considered in
Build Margin calculations
                                                                                           tCO2/GW
                                                         Build Margin           548.76        h
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                               Combined Margin for Northern Grid

                                                         Northern Grid
                                                         (tCO2e/GWh)
Simple Operating Margin - 2002-03                                 1,122
Simple Operating Margin - 2003-04                                 1,018
Simple Operating Margin - 2004-05                                 1,011
Average Operating Margin of last three years                      1,050

                                                         Northern Grid
                                                         (tCO2e/GWh)
Build Margin                                                       549

                                                         Northern Grid
Combined Margin for Wind Power Plants                    (tCO2e/GWh)
                                               Weights
Operating Margin                                 0.75               1,050
Build Margin                                     0.25                 549
Combined Margin                                                    924.96
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                                                Annex 4

                                  MONITORING INFORMATION

•   The electricity supplied to the grid will be metered at the 33/132/220 kV level at the RRVPN
    substation at Amarsagar. Representatives of RRVPN/Jodhpur Discom and Enercon will jointly take
    the main reading and sign the meter reading on the first day of every month. Simultaneously, the
    joint meter reading at the 33/132/220 kV level of the backup metering system at Temderai substation
    will also be taken by representatives of RRVPN/Jodhpur Discom and Enercon.

•   The meters will jointly inspected/tested once in a year as per the terms of the PPA. Joint inspection
    and testing will also be carried out as and when difference in monthly meter readings exceeds the sum
    of maximum error as per accuracy class of main and back up meters.

•   In case the meters are found to operate outside the permissible limits, the meters will be either
    replaced immediately or calibrated. Error correction will be applied to the meter reading. Whenever
    a main meter goes defective, the consumption recorded by the backup meter will be referred. The
    details of the malfunctioning along with date and time and snaps shot parameters along with load
    survey will be retrieved from the main meter. The exact nature of the malfunctioning will be
    determined after analyzing the data so retrieved and the consumption recorded by the main meter will
    be assessed accordingly.

•   If main as well as back up metering system becomes defective, the assessment of energy consumption
    for the outage period will be done from the backup meters by the concerned parties as mutually
    agreed or at the level of Metering Committee set up under the Metering Code.

•   The main and the backup metering systems will be sealed in presence of representatives of Enercon
    and RRVPN/Jodhpur Discom.
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                              Appendix 1 – Location Map
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                   Appendix 2 – Minutes of stakeholder consultation meeting

       Public Consultation Meeting for Wind Energy Projects at Clean Development Mechanism
       Project of Enercon (India) Limited. situated at Kita. Bhu, Sodabhandhan ,Temderai(Phase I,
       PhaseII and PhaseIII), Asloi, Jodha, Korwa and Badabagh in Jaisalmer,Rajasthan
                                      Jaisalmer, District Rajasthan, India
                                        MINUTES OF THE MEETING
       Venue: Gorbandh Palace, Jaisalmer                                   Date: 18 Sep 2006
       The people participated are the following:
       Representatives:
       Representatives from the Village:
       Shri. Rahim Singh
       Shri. Punam Singh
       Shri Kishan Singh
       The list of all other people from the villages is annexed.
       Enercon (India) Limited:
       Mr. Anupam Mathur
       Mr. Rajendra Vyas
       Mr. Rakesh Chhangani
       Mr. Dilip Sharma
       Mr. Neeraj Gupta
       Aditya Environmental Services Pvt. Ltd.
       Mr. Gurmeet Singh
       Mr. Anupam Mathur invited Mr. Punam Singh, Ex- Sarpanch to chair the meeting.

       The agenda of the meeting is fixed as follows:
       Welcome
       Description of the project details
       Queries and responses from the proponent and the stakeholders
       Vote of thanks

                                              WELCOME ADDRESS
       Mr. Dilip Sharma, Security and Liasoning person from Enercon India Limited welcomed all
       the people who came to take part in the meeting. There were more than 20 people from all the
       villages that fall in the vicinity of the project sites.

       Description of the Project Details.
       The present stakeholder consultation is for 60 MW of Enercon Wind Farm Hindustan Limited
       and for 82.74 MW of the customer projects out of which 47.01 MW has been finalized and the
       rest 35.73 MW is in the process to be considered. Some the projects will also come up in
       addition to the finalised projects for CDM.
       The Knowledge of the wind farm was communicated to the local people in the local language.
       The wind farm projects falls in the category of the renewable energy. The meaning of the
       renewable energy was explained. The sites where the projects are located have no commercial
       activity and is a waste land.
       The best use of land is made through the project which otherwise was barren. Improved supply
       of electricity to the grid, and employment opportunities to local people. He explained function
       advantages of the windmill to the people. Self reliance on using renewable energy sources is
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       observed in Jaisalmer.
       The comparison between the wind farm projects and other alternatives is drawn in order to
       convey the advantages that wind power possess over other alternatives. The sites are located
       near Badabagh, Sodabandhan, Korwa, Asloi, Bhu, Temderai (Phase I, Phase II and Phase III)
       and Kita.
       In addition several other support services augmented by Enercon to local people in terms of
       transportation, mid –day meals to school children, renovation of Temedarai temple etc. as its
       social community initiatives.

                                   SPEECH BY MR. PUNAM SINGH
       The chairperson of the meeting briefed the advantages of the wind farm. The project has
       provided the employment opportunities to the local people as the result of which the income of
       the people have increased. He also praised Enercon India Limited for investing in district of
       Jaisalmer.
       Mr. Rahim Singh (BHU Sarpanch)
       The villagers in this part of the state are very backward but the times are changing with
       coming up of the wind farm projects of the Enercon India Limited. The project has provided
       the employment opportunities to the people. Security, drivers and labour people are selected
       among the local villagers.


      Mr. Gurmeet Singh, Aditya Environmental Services briefed the environmental benefits of
      wind power generation as compared to that of thermal power generation based on coal.
      Similarly, a briefing on GHG and its role in global warming / increasing temperatures on the
      earth was given. The benefits in terms of pollution free environment and safeguard to human
      health were also communicated to the stakeholders while comparing coal-based generation to
      wind based generation. The Government of Rajasthan is also encouraging the development of
      renewable energy. Summary on Kyoto Protocol and CDM were made available.

     The concerns, suggestions, opinions of the stakeholders have been specially invited. The
     participants expressed the queries as given below. The representatives from ENERCON
     clarified them as given below.
                       Queries                                     Responses
1.   What are the benefits of the wind power  The project has provided the people with the
     projects the stakeholders have observed? employment opportunities. The project has given
                                              jobs and economic opportunities in terms of small
                                              shops and construction workers.                  The
                                              transportation facilities has improved and has
                                              increased their accessibility to the near by town.
2.   Has the project affected the grazing of  No, the project does not affect the grazing by the
     local cattle?                            cattle. Enercon India Limited does not use any
                                              kind for boundary wall to protect their machines
                                              and hence the accessibility of cattle to areas for
                                              grazing and drinking water is not affected.
3.   Has the project affected any migratory   The project does not fall under migratory patterns
     patterns of birds or fauna?              of the birds. The major birds migrating in the
                                              region, but away from project site are “ Gatta”,
                                              Tilor, and Solan, which usually take their path
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                                                   away from the project site.
4.    Has the project affected the water           The project has improved the availability of water,
      availability? How far are the tube wells     which can also be accessed from project site. The
      located from the site?                       tube wells are located at a distance of 3 Km from
                                                   project site which the people daily access.
5.    During construction and erection has any     As to date no incidence of accident has occurred.
      incident of accident or damage occurred?
6.    Do Enercon take care of safety issues?       The Enercon India Limited takes care about the
                                                   safety issues. Appropriate protocols are in place to
                                                   take care of all the safety issues.
7.    Have you observed any noise                  No noise disturbances have been so far. Local
      disturbances from the project during         inhabitation is far away from the project site.
      construction and operation of the project
      has occurred by the local people?

Women Representative
The women representative asked if school could be provided for the education of the children. The school
can provide the much need education to the children. Also, women should be provided with the good
opportunities.

Vote of thanks
Mr. Dilip Sharma thanked all the people for sparing their time for this meeting and requested them to
continue their support towards the projects of Enercon India Limited. The representatives of the villages
and also the local population represented their happiness towards Enercon India Limited.
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                  PROJECT DESIGN DOCUMENT FORM (PDD)


                                       CONTENTS

A.      General description of project activity

B.      Application of a baseline and monitoring methodology

C.      Duration of the project activity / crediting period

D.      Environmental impacts

E.      Stakeholders’ comments

                                         Annexes

Annex 1: Contact information on participants in the project activity

Annex 2: Information regarding public funding

Annex 3: Baseline information

Annex 4: Monitoring plan

Appendix 1: Location Map

Appendix 2: Minutes of local stakeholder meeting
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      SECTION A. General description of project activity

      A.1     Title of the project activity:
      >>
      Title: Bundled wind energy generation projects in Gujarat, India
      Version: 4.0
      Date: 22/05/2007

      A.2.     Description of the project activity:
      >>
      Objective of the Projects
      The objective of the Projects is development, design, engineering, procurement, finance, construction,
      operation and maintenance of wind power projects in the Indian state of Gujarat to provide reliable,
      renewable power to the Gujarat state electricity grid and the Western regional electricity grid. The energy
      supplied to the grid is drawn at the destination for the captive consumption. The wheeling of the
      electricity from the generating source to the destination for self consumption (captive consumption) is
      guided by the wheeling and banking arrangement. The Projects will lead to reduced greenhouse gas
      emissions because they displace electricity from fossil fuel based electricity generation plants.

      Nature of Projects

      The Projects harness renewable resources in the region, and thereby displacing non-renewable natural
      resources thereby ultimately leading to sustainable economic and environmental development.

      The 59.4 MW bundled Project comprises 3 numbers of 600 kW E-40 and 72 numbers of 800 kW E-48
      Enercon-make wind energy converters. Enercon (India) Ltd (EIL) is the equipment supplier and the
      operations and maintenance contractor for the Projects. All the projects in this bundle of Gujarat are
      captive wind power projects. All the projects are connected to the Gujarat state electricity grid. The
      details of the Projects are provided below:
                                           Table 1 : Details of the Projects

                                           Name of     Name of      M/C Model                        Year of
Sr.No.          Name of Customer                                                    Total MW
                                             Site       State      E-40    E-48                   Commissioning
  1      Desai Textiles                  Navadra      Gujarat        1                 0.60             Jun-04
  2      Rivaa Textiles Ltd              Navadra      Gujarat        2                 1.20            Aug-04
  3      Dinesh Mills                    Bamnasa      Gujarat                5         4.00            Mar-05
  4      Gujarat Guardian Ltd.           Bamnasa      Gujarat               13        10.40            Mar-05
  5      Gujarat Guardian Ltd.           Bamnasa      Gujarat                1         0.80             Jul-05
  6      Shreeji Prints Pvt. Ltd.        Bamnasa      Gujarat                2         1.60            Aug-05
  7      Rachana Art Prints Pvt. Ltd.    Bamnasa      Gujarat                1         0.80            Aug-05
  8      Kanishka Prints P. Ltd.         Bamnasa      Gujarat                1         0.80            Aug-05
  9      Rajshanti Metals Pvt Ltd        Kuranga      Gujarat                1         0.80            Nov-05
 10 Prabhat Elastomers P. Ltd.           Kuranga      Gujarat                2         1.60            Nov-05
 11 Ahmedabad Strips P. Ltd.             Kuranga      Gujarat                1         0.80            Dec-05
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12 Austin Engineering Co Ltd          Kuranga       Gujarat              1         0.80            Dec-05
13 Indo Fashions Pvt. Ltd.            Kuranga       Gujarat              1         0.80            Dec-05
14 Inova Cast Pvt Ltd                 Kuranga       Gujarat              1         0.80            Dec-05
15 Nawaz Silk Mill                    Kuranga       Gujarat              1         0.80            Dec-05
16 Rajhans Metals Pvt Ltd             Kuranga       Gujarat              1         0.80            Dec-05
17 Surbhi Industries Ltd.             Kuranga       Gujarat              1         0.80            Dec-05
18 Eagle Fibres P. Ltd.               Kuranga       Gujarat              1         0.80            Feb-06
19 Ravikan Ceramics Pvt. Ltd.         Navadra       Gujarat              1         0.80            Mar-06
20 Manish Packaging P. Ltd.           Kuranga       Gujarat              1         0.80            Mar-06
21 Unique Tags Private Limited        Navadra       Gujarat              1         0.80            Mar-06
22 Jagdish Technocast Pvt. Ltd.       Navadra       Gujarat              1         0.80            Mar-06
23 Excel Crop Care Limited            Navadra       Gujarat              1         0.80            Mar-06
24 Bhavani Industries                 Navadra       Gujarat              1         0.80            Mar-06
25 Shree Sai Calnates India (P) Ltd. Navadra        Gujarat              1         0.8             Mar-06
26 Shilp Gravures Ltd.                Navadra       Gujarat              1         0.80            Mar-06
27 Empilon Fabrics P. Ltd.            Navadra       Gujarat              1         0.80            Mar-06
28 Leamak Healthcare P. Ltd.          Navadra       Gujarat              1         0.80            Mar-06
29 Jayant Agro-Organics Limited       Navadra       Gujarat              2         1.60            Mar-06
30 Gujarat Guardian Ltd.              Kurunga       Gujarat              7         5.60            Aug-06
31 Madhusudan Special Solutions       Satapar       Gujarat              1         0.80            Sep-06
32 Echjay Industries P. Ltd.          Satapar       Gujarat              6         4.80            Sep-06
33 Gujarat Guardian Ltd.              Satapar       Gujarat              8         6.40            Sep-06
34 Mascot Forge Pvt. Ltd.             Satapar       Gujarat              1         0.80            Sep-06
35 Sayaji Iron & Engineering Co.      Satapar       Gujarat              1         0.80            Sep-06
36 Zydex Industries                   Satapar       Gujarat              1         0.80            Sep-06
37 Transmetal Limited                 Navadara      Gujarat              1         0.80            Mar-06
                                                 Total            3      72       59.40




  Contribution to sustainable development
  The Projects meet several sustainable development objectives including:
  •   contribution towards the policy objectives of Government of India and Government of Gujarat of
      incremental capacity from renewable sources;
  •   contribution towards meeting the electricity deficit in Gujarat;
  •   expansion and diversification in the fuel mix of the Gujarat sector that is susceptible to variation in
      hydrology;
  •   CO2 abatement and reduction of greenhouse gas emissions through development of renewable
      technology;
  •   contribution to improved service delivery to a limited extent;
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•    improvement in the micro-economic efficiency of the sector through various innovations
     incorporated in the project activity;
•    reducing the average emission intensity (SOx, NOx, PM, etc.), average effluent intensity and average
     solid waste intensity of power generation in the system;
•    conserving natural resources including land, forests, minerals, water and ecosystems;
•    developing the local economy and create jobs and employment, particularly in rural areas, which is a
     priority concern for the Government of India;
•    building capacity and empowerment of vulnerable sections of the rural communities in the vicinity of
     the project; and
•    increasing income security of vulnerable sections of the society through redistribution benefits on
     account of the economic activities associated with the project.

A.3.     Technical description of the project activity:

         A.3.1. Location of the project activity:
>>

                 A.3.1.1.           Region/State/Province etc.:
>>
The Projects are located in Western electricity grid region in the state of Gujarat. The Projects are
located in the Jamnagar district.

                 A.3.1.2.           City/Town/Community etc:
>>
Please see location details in A.3.1.3 below.

                A.3.1.3.        Detail of physical location, including information allowing the
unique identification of this project activity (maximum one page):
>>
                                Table – 2: Details of Physical Location

Sr.No.          Name of Customer              Name of Site        Name of State      Unique Identification

     1   Desai Textiles                     Navadra          Gujarat              W3
     2   Rivaa Textiles Ltd                 Navadra          Gujarat              EN/600/04-05/009-010
     3   Dinesh Mills                       Bamnasa          Gujarat              EN/800/04-05/0042-0046
     4   Gujarat Guardian Ltd.              Bamnasa          Gujarat              EIL/800/04-05/0029-0041
     5   Gujarat Guardian Ltd.              Bamnasa          Gujarat              EIL/800/05-06/0063
     6   Shreeji Prints Pvt. Ltd.           Bamnasa          Gujarat              EIL/800/05-06/0064-0065
     7   Rachana Art Prints Pvt. Ltd.       Bamnasa          Gujarat              EIL/800/05-06/0066
     8   Kanishka Prints P. Ltd.            Bamnasa          Gujarat              EIL/800/05-06/0067
     9   Rajshanti Metals Pvt Ltd           Kuranga          Gujarat              EIL/800/05-06/0078
    10   Prabhat Elastomers P. Ltd.         Kuranga          Gujarat              EIL/800/05-06/0072-0073
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  11    Ahmedabad Strips P. Ltd.         Kuranga          Gujarat            EIL/800/05-06/0080
  12    Austin Engineering Co Ltd        Kuranga          Gujarat            EIL/800/05-06/0090
  13    Indo Fashions Pvt. Ltd.          Kuranga          Gujarat            EIL/800/05-06/0086
  14    Inova Cast Pvt Ltd               Kuranga          Gujarat            EIL/800/05-06/0091
  15    Nawaz Silk Mill                  Kuranga          Gujarat            EIL/800/05-06/0084
  16    Rajhans Metals Pvt Ltd           Kuranga          Gujarat            EIL/800/05-06/0088
  17    Surbhi Industries Ltd.           Kuranga          Gujarat            EIL/800/05-06/0085
  18    Eagle Fibres P. Ltd.             Kuranga          Gujarat            EIL/800/05-06/0107
  19    Ravikan Ceramics Pvt. Ltd.       Navadra          Gujarat            EIL/800/05-06/0122
  20    Manish Packaging P. Ltd.         Kuranga          Gujarat            EIL/800/05-06/0122
  21    Unique Tags Private Limited      Navadra          Gujarat            EIL/800/05-06/0102
  22    Jagdish Technocast Pvt. Ltd.     Navadra          Gujarat            EIL/800/05-06/0104
  23    Excel Crop Care Limited          Navadra          Gujarat            EIL/800/05-06/0106
  24    Bhavani Industries               Navadra          Gujarat            EIL/800/05-06/0103
  25    Shree Sai Calnates India (P) Ltd. Navadra         Gujarat            EIL/800/05-06/0108
  26    Shilp Gravures Ltd.              Navadra          Gujarat            EIL/800/05-06/0119
  27    Empilon Fabrics P. Ltd.          Navadra          Gujarat            EIL/800/05-06/0121
  28    Leamak Healthcare P. Ltd.        Navadra          Gujarat            EIL/800/05-06/0120
  29    Jayant Agro-Organics Limited     Navadra          Gujarat            EIL/800/05-06/0110-0111
  30    Gujarat Guardian Ltd.            Kurunga          Gujarat            EIL/800/06-07/0070-0076
  31    Madhusudan Special Solutions     Satapar          Gujarat            EIL/800/06-07/0160
  32    Echjay Industries P. Ltd.        Satapar          Gujarat            EIL/800/06-07/0162-0167
  33    Gujarat Guardian Ltd.            Satapar          Gujarat            EIL/800/06-07/0181-0188
  34    Mascot Forge Pvt. Ltd.           Satapar          Gujarat            EIL/800/06-07/0168
  35    Sayaji Iron & Engineering Co.    Satapar          Gujarat            EIL/800/06-07/0169
  36    Zydex Industries                 Satapar          Gujarat            EIL/800/06-07/0189
  37    Transmetal Limited               Navadara         Gujarat            EIL/800/05-06/0105

         A.3.2. Category(ies) of project activity:
>>
The project activity is considered under CDM category zero-emissions ‘grid-connected electricity
generation from renewable sources’ that generates electricity in excess of 15 MW (limit for small scale
project). Therefore as per the scope of the project activity enlisted in the ‘list of sectoral scopes and
related approved baseline and monitoring methodologies (version 02 Mar 05/07:23)’, the project activity
may principally be categorized in Scope Number 1, Sectoral Scope - Energy industries (renewable/ non-
renewable sources).

        A.3.3. Technology to be employed by the project activity:
>>
The Projects involve Enercon made 600 kW E-40 and 800 kW E-48 rated wind energy converters
(WECs) with internal electrical lines connecting the Projects with local evacuation facility. The WECs
generates 3-phase power at 400V, which is stepped up to 33 KV. The wind farms operate as base load
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units and can operate in the frequency range of 47.5–51.5 Hz and in the voltage range of 400 V ± 12.5%.
The other salient features of the state-of-art-technology are:
• Gearless Construction - Rotor & Generator Mounted on same shaft eliminating the Gearbox.
• Variable Speed function ensuring optimum efficiency at all times. Having speed range of 18 to 33
    RPM.
• Variable Pitch functions ensuring maximum energy capture.
• Near Unity Power Factor at all times.
• Minimum drawl (less than 1% of kWh generated) of Reactive Power from the grid.
• No voltage peaks at any time.
• Operating range of the WEC with voltage fluctuation of -20 to +20%.
• Less Wear & Tear since the system eliminates mechanical brake, which are not needed due to low
    speed generator which runs at maximum speed of 33 rpm and uses Air Brakes.
• Three Independent Braking System.
• Generator achieving rated output at only 33 rpm.
• Incorporates lightning protection system, which includes blades.
• Starts Generation of power at wind speed of 3 m/s.

Enercon (India) Ltd has secured and facilitated the technology transfer for wind based renewable energy
generation from Enercon GmbH, has established a manufacturing plant at Daman in India, where along
with other components the "Synchronous Generators" using "Vacuum Impregnation" technology are
manufactured. Moreover, Enercon India Limited has acquired capabilities to export synchronous
generators and blades of the wind turbines, is recognized as an export house by the Government of India
and has successfully exported wind turbines to Australia.

        A.3.4 Estimated amount of emission reductions over the chosen crediting period:
>>
Crediting Period for the Projects: 01/06/2004 to 31/12/2006

Years                              Annual estimation of emission reductions in tonnes of
                                   CO2e
2004                                                                                  992
2005                                                                               24,152
2006                                                                               68,155
Total estimated reductions (tonnes of CO2e)                                        93,299

        A.3.5. Public funding of the project activity:
>>
There is no ODA financing involved in the Project.

SECTION B. Application of a baseline and monitoring methodology


B.1.    Title and reference of the approved baseline and monitoring methodology applied to the
project activity:
>>
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                                                                                             page 7


The approved consolidated baseline and monitoring methodology ACM0002 Version 6.0 (19 May 2006)
has been used. The titles of these baseline and monitoring methodologies are “Consolidated baseline
methodology for grid-connected electricity generation from renewable sources” and “Consolidated
monitoring methodology for grid-connected electricity generation from renewable sources.

B.2      Justification of the choice of the methodology and why it is applicable to the project
activity:
>>
The Projects are wind based renewable energy source, zero emission power project connected to the
Gujarat state grid, which forms part of the Western regional electricity grid. The Projects will displace
fossil fuel based electricity generation that would have otherwise been provided by the operation and
expansion of the fossil fuel based power plants in Western regional electricity grid. The power generated
is fed to the grid and is wheeled to the industry for captive consumption. The projects are guided by the
wheeling arrangement for wheeling the electricity from the generating source to the destination for
captive consumption.

The approved consolidated baseline and monitoring methodology ACM0002 Version 6 is the choice of
the baseline and monitoring methodology and it is applicable because:
• the Projects are grid connected renewable power generation project activities where in the energy
    generated is wheeled to the destination for captive consumption.
• the Projects represent electricity capacity additions from wind sources
• the Projects do not involve switching from fossil fuel to renewable energy at the site of project
    activity since the Projects are green-field electricity generation capacities from wind sources at sites
    where there was no electricity generation source prior to the Projects
• the geographical and system boundaries of the Western electricity grid can be clearly identified and
    information on the characteristics of the grid is available.

B.3.    Description of the sources and gases included in the project boundary
>>
The project boundary encompasses the physical, geographical site of the Projects sited at the Project
Location. It would include the wind turbine installations and pooling sub-stations up to the Metering
Points.

According to ACM0002, for the baseline emission factor, the spatial extent of the project boundary
includes the project site and all power plants connected physically to the electricity system that the CDM
project power plant is connected to.

The Indian electricity system is divided into five regional grids, viz. Northern, Eastern, Western,
Southern, and North-Eastern. Each grid covers several states. As the regional grids are interconnected,
there is inter-state and inter-regional exchange. A small power exchange also takes place with
neighbouring countries like Bhutan and Nepal.

Power generation and supply within the regional grid is managed by Regional Load Dispatch Centre
(RLDC). The Regional Power Committees (RPCs) provide a common platform for discussion and
solution to the regional problems relating to the grid. Each state in a regional grid meets its demand with
its own generation facilities and also with allocation from power plants owned by the Central Sector such
as NTPC and NHPC etc. Specific quotas are allocated to each state from the Central Sector power plants.
Depending on the demand and generation, there are electricity exports and imports between states in the
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                                                                                                page 8


regional grid. The regional grid thus represents the largest electricity grid where power plants can be
dispatched without significant constraints and thus, represents the “project electricity system” for the
Projects. As the Projects are connected to the Western regional electricity grid, the Western grid is the
“project electricity system”.

            Source                           Gas       Included?      Justifcation/ Explanation
            Electricity generation from      CO2       Included       Main emission source
            power plants connected to        CH4       Excluded       This source is not required to be
            the Western Grid                                          estimated for wind energy projects
                                                                      under ACM0002
Baseline




                                             N2O       Excluded       This source is not required to be
                                                                      estimated for wind energy projects
                                                                      under ACM0002
            Electricity generation from      CO2       Excluded       Wind energy generation does not have
Activity
Project




            the Projects                     CH4       Excluded       any direct GHG emissions.
                                             N2O       Excluded



B.4.    Description of how the baseline scenario is identified and description of the identified
baseline scenario:

>>
According to ACM0002, for project activities that do not modify or retrofit an existing electricity generation
facility, the baseline scenario is the following:

Electricity delivered to the grid by the project would have otherwise been generated by the operation of
grid-connected power plants and by the addition of new generation sources, as reflected in the combined
margin (CM) calculations described below.

As the Projects do not modify or retrofit an existing generation facility, the baseline scenario is the
emissions generated by the operation of grid-connected power plants and by the addition of new
generation sources. This is estimated using calculation of Combined Margin multiplied by electricity
delivered to the grid by the Projects.

B.5.    Description of how the anthropogenic emissions of GHG by sources are reduced below
those that would have occurred in the absence of the project activity:
>>
Common Practice Test
Provision of underlying service or product with the project technology does not exceed 51% in the
defined market area.

Investment in wind energy projects in the State of Gujarat and the Western regional electricity grid are
not mandatory. There are no national or local laws or regulations that require this investment to be
undertaken, i.e., setting up of wind power projects. The setting up of wind energy projects is a voluntary
activity.
                              PROJECT DESIGN DOCUMENT FORM (PDD)

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We analyze the extent to which wind energy projects have diffused in the electricity sector in Gujarat. In
2004 – 05, wind electricity generation was 350 GWh1 and the total electricity availability from all the
sourcesd at bus-bar in the state of Gujarat was 53410 GWh2. This works out to 0.65%, showing that
wind energy power generation is insignificant as compared to other power project generation sources in
Gujarat.

Installed capacity of wind energy generation sources stood at 219.9 MW3 as of 31 March 2005.

Clearly, wind power project development in Gujarat is insignificant when compared to the power sector
of Gujarat. Further, wind power project development is substantially dependent on CDM mechanism and
thus is not common practice.

Enforcement of applicable laws and regulations


          Local or National Legislation does not require the production of the underlying service or
          product with the chosen technology.

          Additionally, the Project should not have been undertaken to meet a formal or voluntary target
          imposed by government regulation or under agreement with a       government agency (e.g. the
          auto manufacturers and the EU, where companies agree to meet reduction targets voluntarily
          through their industry association).

          Carbon credits should not be the by-product from the creation of an ancillary environmental asset
          and/or financial instrument (e.g. renewable energy credits).

          The emission reductions from the Project must not have been used against any voluntary
          corporate emission reduction targets.

          Project is not a downstream energy efficiency project in a jurisdiction with a mandatory GHG
          emissions cap on upstream electricity generators.

There is no legal and regulatory requirement that mandates the production of energy by the chosen
technology. Investment in wind energy projects in the State of Gujarat and the western regional
electricity grid are not mandatory. There are no national or local laws or regulations that require this
investment to be undertaken, i.e., setting up of wind power projects. The setting up of wind energy
projects is a voluntary activity.

Carbon credits produced are not the by-products from the creation of an ancillary environmental asset.
The emission reductions from the project are not used for against any voluntary corporate emission
reduction targets. India is a Non-Annex-1 and has not yet capped the emission reduction target for any
industry. Hence project is not the down stream energy efficiency project and is not mandated by
jurisdiction



1
    Source: Table No. 3.4, CEA General Review 2006
2
    Source: Table No. 5.2, CEA General Review 2006
3
    Source: Table No. 2.4, CEA General Review 2006
                                 PROJECT DESIGN DOCUMENT FORM (PDD)

                                                                                                           page 10


The project is not the least cost option for providing the underlying product or service.

             Companies shall provide calculations that illustrate that the project is not the Least Cost Option.

The cost of generation from the various options available to the investors is complied in the table given
below. The cost of each of the categories is compared against the cost of generation form the wind power
projects which is considerably higher. Gujarat electricity regulatory commission has given the tariff
based on cost of generation at Rs. 3.37, which is considerably higher than the cost of generation listed in
the table below (Data for the cost of generation has been compiled from the tariff order of Gujarat State
Electricity Corporation Limited (GSECL) dated 31st March 2007). Hence we can state from the above
analysis that wind energy is not the least cost option for the off takers of electricity.

                                                        Annual                                       Total
                                        Net                       Fixed Cost Variable
                                                         Fixed                                      Cost Per
    Sl.No.           Station         Generation                    Per Unit  Charges
                                                        Charges                                       Unit
                                         (MU)         (Rs. Lakhs) (Rs./Kwh) Rs./kWh.                Rs./Unit
              Thermal
     1        Ukai TPS                        4,744         17,248          0.36             1.47         1.83
     2        Gandhinagar 1-4                 3,340         18,621          0.56             1.65         2.21
     3        Gandhinagar –5                  1,481          7,780          0.53             1.46         1.99
     4        Wanakbori 1-6                   8,135         29,557          0.36             1.65         2.01
     5        Wanakbori – 7                   1,481          7,843          0.53             1.63         2.16
     6        Sikka                           1,408          9,016          0.64             1.99         2.63
     7        Lignite Based
     8        KLTPS - 1-3                     1,157         16,384          1.42             1.07         2.49
     9        KLTPS – 4                         144          4,250          2.95             1.01         3.96
     10       Oil and Gas Based
     11       Dhuvaran Oil                    1,303          7,852          0.60             3.76         4.36
     12       Dhuvaran Gas-1                    693          4,433          0.64             2.25         2.89
     13       Dhuvaran Gas-2                    756          6,255          0.83             2.23         3.06
     14       Utran Gas                         877          4,476          0.51             1.98         2.49
              Hydro
       1.     Ukai Hydro                        525           2659          0.51                0         0.51
       2.     Kadana Hydro                      144           8112          5.63                0         5.63



B.6.         Emission reductions:
             B.6.1. Explanation of methodological choices:
>>
According to the approved baseline methodology ACM0002, the emission reductions ERy by the project
activity during a given year “y1” is

ERy = BEy – PEy – Ly……………….(1)

1
  Throughout the document, the suffix y denotes that such parameter is a function of the year y, thus to be monitored at least
annually.
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                                                                                                     page 11




BEy      is the baseline emissions
PEy      is project activity emissions and;
Ly       is the amount of emissions leakage resulting from the project activity.

Baseline Emissions for the amount of electricity supplied by project activity, BEy is calculated as

BEy = EGy * EFy …………………….(2)

where EGy is the electricity supplied to the grid, EFy is the CO2 emission factor of the grid as calculated
below.

The emission factor EFy of the grid is represented as a combination of the Operating Margin (OM) and
the Build Margin (BM). Considering the emission factors for these two margins as EFOM,y and EFBM,y,
then the EFy is given by:

EFy = wOM * EFOM,y + wBM * EFBM,y…………………………..(2)

with respective weight factors wOM and wBM (where wOM + wBM = 1).


The Operating Margin emission factor

As per ACM0002, dispatch data analysis should be the first methodological choice. However, this
option is not selected because the information required to calculate OM based on dispatch data is not
available in the public domain for the Western electricity regional grid.

The Simple Operating Margin approach is appropriate to calculate the Operating Margin emission factor
applicable in this case. As per ACM 0002 the Simple OM method can only be used where low cost must
run resources constitute less than 50% of grid generation based on average of the five most recent years.
The generation profile of the Western grid in the last five years is as follows:

 Generation in GWh                         2004-05        2003-04        2002-03       2001-02        2000-01
 Low cost/must run sources
   Hydro                                      10,610           9,282          8,172   7,928               7,174
   Wind & Renewables                             884           1,522            879   610                   314
   Nuclear                                     5,100           5,700          6,200   6,073               5,903
 Other sources
   Coal                                      141,964        136,063        137,392    133,628           128,561
   Diesel                                          -              -              -               -            -
   Gas                                        25,526         21,508         18,713    16,072             21,280
 Total Generation                            184,084        174,075        171,356        164,311       163,232
 Low cost/must run sources                    16,594         16,504         15,251         14,611        13,391
 Low cost/must run sources                       9%             9%             9%             9%            8%
Source: Table 3.4 of CEA General Review 2004-05, 2003-04, 2002-03, 2001-02, 2000-01
                             PROJECT DESIGN DOCUMENT FORM (PDD)

                                                                                             page 12


From the available information it is clear that low cost/must run sources account for less than 50% of the
total generation in the Western grid in the last five years. Hence the Simple OM method is appropriate to
calculate the Operating Margin Emission factor applicable.

Build Margin Emission Factor

The Build Margin emission factor EF_BMy (tCO2/GWh) is given as the generation-weighted average
emission factor of the selected representative set of recent power plants represented by the 5 most recent
plants or the most recent 20% of the generating units built (summation is over such plants specified by
k):

EFBM,y = [∑i Fi,m,y*COEFi] / [∑k GENk,m,y]………………………..(5)

The summation over i and k is for the fuels and electricity generation of the plants in sample m
mentioned above.

The choice of method for the sample plant is the most recent 20% of the generating units built as this
represents a significantly larger set of plants for a large regional electricity grid having a large number of
power plants connected to it and is therefore appropriate.

The Central Electricity Authority, Ministry of Power, Government of India has published a database of
Carbon Dioxide Emission from the power sector in India based on detailed authenticated information
obtained from all operating power stations in the country. This database i.e. The CO2 Baseline Database
provides information about the Operating Margin and Build Margin Emission Factors of all the regional
electricity grids in India. The Operating Margin in the CEA database is calculated ex ante using the
Simple OM approach and the Build Margin is calculated ex ante based on 20% most recent capacity
additions in the grid based on net generation as described in ACM0002. We have, therefore, used the
Operating Margin and Build Margin data published in the CEA database, for calculating the Baseline
Emission Factor.

Combined Margin Emission Factor

As already mentioned, baseline emission factor (EFy) of the grid is calculated as a combined margin
(CM), calculated as the weighted average of the operating margin (OM) and build margin (BM) factor. In
case of wind power projects default weights of 0.75 for EFOM and 0.25 for EFBM are applicable as per
ACM0002. No alternate weights are proposed.

Using the values for operating margin and build margin emission factors provided in the CEA database
and their respective weights for calculation of combined margin emission factor, the baseline carbon
emission factor (CM) is 940.22 tCO2e/GWh or 0.94022 tCO2e/MWh.

Project Emissions:

The project activity uses wind power to generate electricity and hence the emissions from the project
activity are taken as nil.

PEy = 0

Leakage:
                               PROJECT DESIGN DOCUMENT FORM (PDD)

                                                                                                  page 13




Emissions Leakage on account of the project activity is ignored in accordance with ACM0002.

Ly = 0

         B.6.2. Data and parameters that are available at validation:

Data / Parameter:             EFOM,y
Data unit:                    tCO2e/MWh
Description:                  Operating Margin Emission Factor of Westernal Electricity Grid
Source of data used:          “CO2 Baseline Database for Indian Power Sector” published by the Central Electricity
                              Authority, Ministry of Power, Government of India.

                              The “CO2 Baseline Database for Indian Power Sector” is available at www.cea.nic.in

Value applied:
                               2002 – 03       0.9814
                               2003 – 04       0.9903
                               2004 – 05       1.0119
Justification of the choice
of data or description of     Operating Margin Emission Factor has been calculated by the Central Electricity
measurement        methods    Authority using the simple OM approach in accordance with ACM0002.
and procedures actually
applied :


Data / Parameter:             EFBM,y
Data unit:                    tCO2e/MWh
Description:                  Build Margin Emission Factor of Western Electricity Grid
Source of data used:          “CO2 Baseline Database for Indian Power Sector” published by the Central Electricity
                              Authority, Ministry of Power, Government of India.

                              The “CO2 Baseline Database for Indian Power Sector” is available at www.cea.nic.in

Value applied:                0.7772
Justification of the choice
of data or description of     Build Margin Emission Factor has been calculated by the Central Electricity Authority
measurement        methods    in accordance with ACM0002.
and procedures actually
applied :


         B.6.3 Ex-ante calculation of emission reductions:
         >>
         See B.6.4 below.

         B.6.4    Summary of the ex-ante estimation of emission reductions:
         >>
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                                                                                             page 14



Year                    Estimation     of     Estimation     of    Estimation     of Estimation     of
                        project activity      baseline             leakage           overall emission
                        emissions             emissions            (tonnes of CO2e)  reductions
                        (tonnes of CO2e)      (tonnes of CO2e)                       (tonnes of CO2e)
2004                    0                            992                   0                992
2005                    0                           24,152         0                      24,152
2006                    0                           68,155         0                      68,155
Total                   0                                          0
(tonnes of CO2e)                                    93,299                                93,299

B.7       Application of the monitoring methodology and description of the monitoring plan:

          B.7.1   Data and parameters monitored:

Data / Parameter:           EGy
Data unit:                  MWh (Mega-watt hour)
Description:                Net electricity supplied to the grid by the Projects
Source of data to be        Certification of metering records and share certificate for electricity produced by
used:                       wind farm provided by GEDA (Gujarat Energy Development Agency)
Value of data applied       2006: 72,488,586 kWh
for the purpose of          2005: 25,687,600 kWh
calculating  expected       2004: 1,055,294 kWh
emission reductions in
section B.5
Description         of      Net electricity supplied to grid is measured by main meters (export and import)
measurement methods         at the Metering Point. This is further described in Annex – 2.
and procedures to be
applied:
QA/QC procedures to         QA/QC procedures are elaborated in Annex – 2 (Monitoring Plan).
be applied:
Any comment:                The meter testing and checking procedures that are solely within the purview of
                            GETCO (Gujarat Energy Transmission Corporation Limited), i.e., frequency of
                            testing of main/check meters, quality and standards of portable meter testing
                            equipment, testing and calibration of portable meter testing equipment using a
                            meter testing bench, testing and calibration of meter testing bench, etc. are
                            outside the purview of the monitoring plan for the Projects.


        B.7.2 Description of the monitoring plan:
>>
Approved monitoring methodology ACM0002 / Version 06 Sectoral Scope: 1, “Consolidated monitoring
methodology for zero-emissions grid-connected electricity generation from renewable sources”, by CDM
- Meth Panel is proposed to be used to monitor the emission reductions.

This approved monitoring methodology requires monitoring of the following:

•     Electricity generation from the project activity; and
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                                                                                             page 15



•   Operating margin emission factor and build margin emission factor of the grid, where ex post
    determination of grid emission factor has been chosen
Since the baseline methodology is based on ex ante determination of the baseline, the monitoring of
operating margin emission factor and build margin emission factor is not required.

Hence, under the monitoring protocol for the Project it is required to monitor the units of electricity
supplied to the grid by the wind farms. The monitoring procedures and QA/QC procedures are provided
in Annex – 2 (Monitoring Plan)

The Projects are operated and managed by Enercon (India) Ltd.


SECTION C. Duration of the project activity / crediting period

C.1     Duration of the project activity:

        C.1.1. Starting date of the project activity:
>>
The start date of the Projects is the date of purchase order for the first sub-project to be commissioned.
This project is Sr. No. 01 (Desai Textiles) in Table – I and the date of purchase order is 29/01/2004.

        C.1.2. Expected operational lifetime of the project activity:
>>
20 years

C.2     Crediting period and related information:

        C.2.1.           Starting date of the crediting period:
>>
01/06/2004 for all projects.

        C.2.2.           End of crediting period:
>>
31/12/2006


SECTION D. Environmental impacts
>>

D.1.    Documentation on the analysis of the environmental impacts, including transboundary
impacts:
>>
Enercon appointed Care Sustainability to conduct rapid environmental impact assessment study to assess
the impact of the project on the local environment.

Environmental Impact Assessment (EIA) of this project is not an essential regulatory requirement, as it is
not covered under the categories as described in EIA Notification of 1994 or the Amended Notification
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of 2006. However, Enercon conducted the EIA to study impacts on the environment resulting from the
project activity.

The EIA study included identification, prediction and evaluation of potential impacts of the CDM
activities on air, water, noise, land, biological and socio-economic environment within the study area.
The ambient air concentrations of Suspended Particulate Matter, Respirable Particulate Matter, Oxides of
Nitrogen, Sulphur dioxide and Carbon Monoxide were monitored and were found under limits as
specified by CPCB. The noise levels were observed through out the study period and were found to be in
the permissible range as specified by the state pollution control board and National Ambient Air Quality
Standards. Water quality monitoring studies were carried out for determination of physico-chemical
characteristics of bore wells. The ph level of water was found to be under the specified limits.

The site does not involve any sensitive archaeological monuments as per the Archaeological Survey of
India. No Historical and Cultural Monuments have been affected due to project location. The project area
consists of some grass shrubs and does not have much to offer aesthetically. However, construction of
wind power mills with pleasing architectural design that blends with the landscape will have a positive
impact on the aesthetics of the present surrounding of the site.

D.2.    If environmental impacts are considered significant by the project participants or the host
Party, please provide conclusions and all references to support documentation of an environmental
impact assessment undertaken in accordance with the procedures as required by the host Party:
>>
EIA demonstrated that there is no major impact on the environment due to the installation and operation
of the windmills. The ecology is not likely to get impacted by this type of project activity. The local
population confirmed that there is no noise or dust nuisance due to windmills. The EIA also ruled out
any adverse impacts due to the project activity.

SECTION E. Stakeholders’ comments
>>

E.1.    Brief description how comments by local stakeholders have been invited and compiled:
>>
The comments from local stakeholders were invited through a local stakeholder meeting conducted at
Satapar site office, Jamnagar on 16 December 2006. A local newspaper advertisement was placed in
Aajkal on 2nd December 2006 inviting the local stakeholders for the meeting.

The local stakeholder consultation meeting had representatives from the nearby villages, representatives
of Enercon. The minutes of the meeting are set out in Appendix 1.

E.2.   Summary of the comments received:
>>
The comments from local villagers included:
 • The nature of benefits that local stakeholders will get
 • Impact on the grazing of local cattle
 • Impact on any migratory patterns of birds or fauna
 • Addressing safety issues by Enercon, incidence of accidents
 • Noise disturbance
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E.3.    Report on how due account was taken of any comments received:
>>
Enercon provided the following responses in relation to the comments received from the local
stakeholders:
• The benefits to the local stakeholders will be through employment opportunities provided by the
    project in terms of construction workers. It will also lead to better connectivity to nearby towns.
• The project does not affect the grazing by the cattle. Enercon does not use any kind for boundary
    wall to protect their machines and hence the accessibility of cattle to areas for grazing and drinking
    water is not affected.
• The Project does not fall under migratory patterns of the birds.
• Enercon has appropriate protocols are in place to take care of all the safety issues. No incidence of
    accident has occurred.

The local stakeholders were satisfied with the explanations provided during the meeting.




                                                 Annex 1

        CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY

Organization:            Enercon (India) Limited
Street/P.O.Box:          A-9, Veera Industrial Estate, Veera Desai Road, Andheri West-400053
Building:                Enercon Tower
City:                    Mumbai
State/Region:            Maharashtra
Postfix/ZIP:             400 053
Country:                 India
Telephone:               +91-22-66924848
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FAX:               +91-22-67040473
E-Mail:            a.raghavan@enerconindia.net
URL:
Represented by:
Title:             Associate Vice President
Salutation:        Mr.
Last Name:         A V Raghavan
Middle Name:
First Name:
Department:        Corporate
Mobile:            +91-98200 45724
Direct FAX:        +91-22-5692 1175
Direct tel:        +91-22-6692 4848 extn. 7169
Personal E-Mail:   a.raghavan@enerconindia.net
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                    Annex 2

INFORMATION REGARDING PUBLIC FUNDING

    No ODA funding is sorted for this project.
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                                                Annex 3

                                    BASELINE INFORMATION


The Operating Margin data for the most recent three years and the Build Margin data for the Western
Electricity Grid as published in the CEA database are as follows:

Simple Operating Margin

                                                   tCO2e/GWh
 Simple Operating Margin - 2002-03                         981.41
 Simple Operating Margin - 2003-04                         990.31
 Simple Operating Margin - 2004-05                        1011.94
 Average Operating Margin of last three years              994.55

Build Margin

                                                   tCO2e/GWh
 Build Margin                                              777.22

Combined Margin calculations

                                     Weights       tCO2e/GWh
 Operating Margin                       0.75               994.55
 Build Margin                           0.25               777.22
 Combined Margin                                           940.22

Detailed information on calculation of Operating Margin Emission Factor and Build Margin Emission
Factor is available at www.cea.nic.in.
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                                            Annex 4

                              MONITORING INFORMATION

•   The electricity supplied to the grid will be metered at the 132 kV level at the Bhogat substation
    and at the 66 kV at Navadra substation. Representatives of GEDA (Gujarat Energy Development
    Agency), GETCO (Gujarat Energy Transmission Corporation Limited) and Enercon will jointly
    take the main meter reading and sign the meter reading every month. Enercon has also installed
    the meters for each customer, which is sealed in presence of representatives of Enercon, GETCO
    (Gujarat Energy Transmission Corporation Limited) and GEDA (Gujarat Energy Development
    Agency).

•   This value of the monthly joint meter reading of the EIL sub-station is then apportioned to the
    EB reading taken for each customer to get the net supply of electricity to the grid for that
    particular customer. The share certificate is signed by the GEDA (Gujarat Energy Development
    Agency) officials, which is used to produce invoice on behalf of the customer

•   The meters will be jointly inspected/ tested once in a year as per the terms of the Wheeling
    arrangement. Joint inspection and testing will also be carried out as and when difference in
    monthly meter readings exceeds the sum of maximum error as per accuracy class of main and
    back up meters.

•   In case the meters are found to operate outside the permissible limits, the meters will be either
    replaced immediately or calibrated.
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       Appendix 1 – Location Map
                 A.
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                      Appendix 2 – Minutes of stakeholder consultation meeting


Public Consultation Meeting of Wind Energy Projects for Clean Development Mechanism (CDM)
Project of Enercon (India) Limited situated at Satapar, Bamanasa, Navadra, Kuranga and Okhamati.,
Distt. Jamnagar, Gujarat.

                           Kalyanpur, District Jamnagar, Gujarat (INDIA)

                                    MINUTES OF THE MEETING

Agenda :        Local Public Consultation Meeting of stakeholder of Wind Energy Projects for Clean
                Development Mechanism.

Venue :         Service Office, SATAPAR

Date :          December 16, 2006

Time :          1500 hrs to 1800 hrs

Representative from the local stakeholders who were chief guest and shared the dash.

 Sr.                       Name                                  Village                  Port-folio
 No.
01.      Mr. Markhi R Der                              Navadra                    Sarpanch
02.      Mr. Jodha bhai                                Satapar                    Dy. Sarpanch
03.      Mr. Mughabhai                                 Lamba                      Sarpanch
04.      Mr. Chetaniya Ranabhai                        Satapar                    Sarpanch

The list of all other members representing other villages within the nearby vicinity is attached with this
as Annexure ‘A’. (Total list of 22 persons).

Following people were representing Enercon (India) Ltd for the purpose of this meeting;

Mr. Mahender Singh, Project Ofice
Mr. K .D. Baria, Service Office.
Mr. Vivek Sen, Corporate Office Mumbai

Mr. K.D. Baria invited the above representative of the different villages to chair the meeting.

The agenda of the meeting was fixed as follows :-
       1.       Welcome                                   :-By Mr. Mahender Singh
       2.       Description of the project details        :-By Mr. K .D. Baria
       3.       Quarries from stakeholders                :- Stakeholders & villagers (open)
       4.       Vote of Thanks                            :- By Mr. Mahender Singh & Mr.
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K.D. Baria

Welcome Address
Mr. Mahender Singh from Enercon (I) Limited welcomed all the people who came to take part in the
meeting including the chief guest. There were more than 22 people from all the villages that fall in the
region of the project sites.

Description of the project Details :

Mr. K.D. Baria highlighted the project description right from the beginning of the initial project in that
area. The knowledge and awareness of the Wind farms was communicated to the local people in the local
language. The wind farm projects falls in the category of the renewable energy. The meaning of the
renewable energy was explained. The sites where the projects are located have no commercial activities
and is a waste land procured through Government was explained to the villagers.

The advantage of the Wind Mills to the people in that region and to India as such was explained to the
people. The optimum use of the barren land was explained to them. In addition to this several other
support services augmented by the ENERCON to local people in terms of making available access road
to the villages, transportation system, providing employment to the local people of skill and unskill
category was explained to them.

The Wind Farm produces the clean and green energy and do not account for any kind of pollution as
might be the case with other alternatives. The comparison between the wind farm projects and other
alternatives was drawn in order to communicate the advantages that wind power possess over other
alternatives of renewal energy available in India.

Mr. Mahender Singh

Mr. Mahender Singh briefed the advantages of the wind farm in the region and in India as a whole and
emphasized on the employment opportunity being provided to the local people in the region and as a
result of which the economic conditions of the local people has been improving in the region.

Mr. K.D. Baria

Mr. Kantilal D Baria emphasized that the economic conditions of the people and villagers in this area are
not good. With the coming up of the wind farm projects of Enercon (India) Limited, there has been a
tremendous improvement in the economic conditions of the villagers as the employment opportunities to
the people in the form of Security guards, drivers, labourers, extending contract for construction work,
road work and other avenues have been opened by the Enercon. The educated people have also been
given permanent employment which are on the mustered roll of the company depending upon their
competency and talent.

Mr. Vivek Sen

Mr. Vivek Sen explained the villagers about the basic concept of CDM and its importance in the current
context of climatic change and concern of the nations around the world to tackle this change. He told
how Enercon India Ltd is earning carbon credits and distributing the benefits to the project owners. He
also emphasized that Enercon is doing a great work for the development of power infrastructure in the
region along with the goal of contributing to the sustainable development.
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The opinions, suggestions and concerns of the stakeholders were specially invited. The participants
including the chief guest expressed the quarries as given below. The representative of the ENERCON
clarified them as given below :-

Sl.    Quarries                                  Responses
No.
01.    Will the project affect the grazing of No, the project do not affect the grazing of the cattle.
       local cattle ?                          Enercon (India) Limited does not use any kind for
                                               boundary wall to protect their machines and hence the
                                               accessibility of cattle to areas for grazing and drinking
                                               water is not affected in any manner.
02.    Do Enercon takes care of safety issues? The Enercon (India) limited takes care about the safety
                                               issues. Appropriated protocols are in place to take care
                                               of all the safety issues.
03.    What are the benefits of the wind The project will provide the people with the
       power projects that stakeholders shall employment opportunities.
       observe?                                The project will give further jobs to the deserving
                                               villagers so as to improve upon the economic
                                               conditions of the villagers and explore the
                                               opportunities in terms of assigning construction, road
                                               work to the deserving villagers.
04.    Will the project affect any migratory The project does not fall under migratory patterns of
       patterns of birds or fauna ?            the birds.
05.    During construction and erection has Till date no incident of accident has occurred. Even
       any incident of accident or damage blasting is done under strict control and supervision
       occurred?                               with enough warning. Mainly ground blasting is
                                               practiced.
06.    Does the project help in improving the The duration of power supply to the villages has
       electricity supply to the villagers or increased and also there is improvement in quality of
       neighbourhood areas ?                   the power supply. The power fluctuations in the
                                               voltage have remarkably decreased.
07.    Have you observed any noise No noise disturbances have been observed so far.
       disturbances from the project during
       construction and operation of the
       project?


Vote of Thanks

Mr. Mahender Singh and Mr. K.D. Baria thanked all the people for sparing their time for this meeting
and requested them to continue their support and cooperation towards the projects of ENERCON
(INDIA) Limited in the vested interest of the local public and nation as a whole. All the appointed
representative of the villages and also the local population present in the meeting expressed their
happiness towards the Enercon (India) Limited for their noble gesture of organizing this meeting with the
villagers and stakeholders.
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                         CLEAN DEVELOPMENT MECHANISM
                     PROJECT DESIGN DOCUMENT FORM (CDM-PDD)
                          Version 03 - in effect as of: 28 July 2006

                                             CONTENTS

      A.      General description of project activity

      B.      Application of a baseline and monitoring methodology

      C.      Duration of the project activity / crediting period

      D.      Environmental impacts

      E.      Stakeholders’ comments

                                               Annexes

      Annex 1: Contact information on participants in the project activity

      Annex 2: Information regarding public funding

      Annex 3: Baseline information

      Annex 4: Monitoring plan

      Appendix 1: Location Map

      Appendix 2: Minutes of local stakeholder meeting
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SECTION A. General description of project activity

A.1     Title of the project activity:
>>
Title: Enercon Wind Farms in Karnataka Bundled Project – 30.40 MW
Version: 2.0
Date of completion of PDD: 06/07/2007

A.2.    Description of the project activity:
>>
Objective of the Project

The objective is development, design, engineering, procurement, finance, construction, operation and
maintenance of Enercon Wind Farm (Chitradurga) Ltd 8.8 MW and other wind power projects of 21.60
MW capacity (“Project”) in the Indian state of Karnataka to provide reliable, renewable power to the
Karnataka state electricity grid which is part of the Southern regional electricity grid. The Project will
lead to reduced greenhouse gas emissions because it displaces electricity from fossil fuel based electricity
generation plants.

Nature of Project

The Project harnesses renewable resources in the region, and thereby displacing non-renewable natural
resources thereby ultimately leading to sustainable economic and environmental development. Enercon
(India) Ltd (“Enercon”) will be the equipment supplier and the operations and maintenance contractor for
the Project. The generated electricity will be supplied to Karnataka Power Transmission Company Ltd
(“KPTCL”)/ Bangalore Electricity Supply Company Ltd (“BESCOM”) / Hubli Electricity Supply
Company Ltd (“HESCOM”) under long-term power purchase agreements (PPA). Enercon Wind Farm
(Chitradurga) Ltd is owned by Enercon (India) Ltd and Enercon GmbH and the rest of the projects are
owned by Enercon’s customers. The details of the Projects are as under:
  1. Enercon Wind Farms (Chitradurga) Ltd: 8.80 MW
  2. Steelfab Offshore                           0.80 MW
  3. Dewanchand Ramsaran:                        0.80 MW
  4. Elpro International:                        0.80 MW
  5. Gautam Ladkat:                              0.80 MW
  6. Sameer Ladkat:                              0.80 MW
  7. Panama Business Centre:                     1.60 MW
  8. Balasahab Ladkat:                           1.60 MW
  9. Panama Infrastructure:                      1.60 MW
  10. MK Agrotech Private Ltd:                   1.60 MW
  11. Srinivas Sirigeri:                         0.80 MW
  12. R.K.Marbles:                               0.80 MW
  13. Dempo Industries:                          0.80 MW
  14. Desai Brothers:                            0.80 MW
  15. Abhilash Garments & Estates (P) Ltd:       0.80 MW
  16. Prasad Global Solutions:                   1.60 MW
  17. Siddaganga Oil Extractions Ltd.:           1.60 MW
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    18. Gangadhar Narsingdas Agarwal:              4.00 MW

Contribution to sustainable development
The Project meets several sustainable development objectives including:
•     contribution towards the policy objectives of Government of India and Government of Karnataka of
      incremental capacity from renewable sources;
•     contribution towards meeting the electricity deficit in Karnataka;
•     CO2 abatement and reduction of greenhouse gas emissions through development of renewable
      technology;
•     reducing the average emission intensity (SOx, NOx, PM, etc.), average effluent intensity and average
      solid waste intensity of power generation in the system;
•     conserving natural resources including land, forests, minerals, water and ecosystems; and
•     developing the local economy and create jobs and employment, particularly in rural areas, which is a
      priority concern for the Government of India;


A.3.    Project participants:
>>
Name of Party involved ((host)        Private and/or public                Kindly indicate if the Party
indicates a host Party)               entity(ies) project participants     involved wishes to be
                                      (*) (as applicable)                  considered as project
                                                                           participant (Yes/No)
Government of India (Host)            Enercon (India) Ltd                  No
Government of Japan                   Japan Carbon Finance                 No

The contact details of the entities are provided in Annex – 1. All the projects have authorized Enercon
(India) Ltd to take them through the CDM process.


A.4.      Technical description of the project activity:

          A.4.1. Location of the project activity:
>>

                  A.4.1.1.         Host Party(ies):
>>
The host party to the project activity is the Government of India.

                 A.4.1.2.         Region/State/Province etc.:
>>
The Project is located in the State of Karnataka that forms part of the Southern regional electricity grid of
India.
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                A.4.1.3.        City/Town/Community etc:
>>
Sub-project No. 1 is located in Bhrampura village, Hiriyur talkuk of Chitradurga district. Sub-Projects 2
to 14 are located in village Ittegehalli, Myakenahalli, Katheholle, Goolihosahalli, Lakkihalli,
Lingadevarahalli, Mulashiranahalli, all located in Jogimatti wind Zone of Chitradurga district. Sub-
Projects 15 to 18 are located in Kapatagudda Wind Zone of Gadag district.

                A.4.1.4.         Detail of physical location, including information allowing the
unique identification of this project activity (maximum one page):
>>
For sub-project 1, the project area extends between latitude 14o 02’ & 14o 04’ North and longitude 76o
27’ & 76o 28’ East. This sub-project is connected to the Aiamangla 66/11 kV KPTCL sub-station.

For sub-projects 2 to 10, the project area extends between latitude 13o 57’ & 14o 01’ North and longitude
76o 24’ & 76o 29’ East. These sub-projects are connected to the Hiriyur 220/66/11 kV KPTCL sub-
station.

For sub-projects 11 to 14, the project area extends between latitude 13o 58’ & 14o 02’ North and
longitude 76o 17’ & 76o 20’ East. These sub-projects are connected to the Ramgiri 66/11 kV KPTCL
sub-station.

For sub-projects 15 to 18, the project area extends between latitude 14o 11’ & 14o 14’ North and
longitude 76o 43’ & 76o 45’ East. These sub-projects are connected to the Dambal 110/33/11 kV KPTCL
sub-station.

The sites are located at a distance of 200 km from Bangalore by road. The nearest railway station is at
Bangalore. A location map is attached at Appendix – 1.

        A.4.2. Category(ies) of project activity:
>>
The project activity is considered under CDM category zero-emissions ‘grid-connected electricity
generation from renewable sources’ that generates electricity in excess of 15 MW (limit for small scale
project). Therefore as per the scope of the project activity enlisted in the ‘list of sectoral scopes and
related approved baseline and monitoring methodologies (version 02 Mar 05/07:23)’, the project activity
may principally be categorized in Scope Number 1, Sectoral Scope - Energy industries (renewable/ non-
renewable sources).

        A.4.3. Technology to be employed by the project activity:
>>
The Project involves 38 wind energy converters (WECs) of Enercon make 800 kW E-48 with internal
electrical lines connecting the Project with local evacuation facility. The WECs generates 3-phase power
at 400V, which is stepped up to 33 KV. The Project can operate in the frequency range of 47.5–51.5 Hz
and in the voltage range of 400 V ± 12.5%. The other salient features of the state-of-art-technology are:
• Gearless Construction - Rotor & Generator Mounted on same shaft eliminating the Gearbox.
• Variable speed function – has the speed range of 18 to 33 RPM thereby ensuring optimum efficiency
    at all times.
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•   Variable Pitch functions ensuring maximum energy capture.
•   Near Unity Power Factor at all times.
•   Minimum drawl (less than 1% of kWh generated) of Reactive Power from the grid.
•   No voltage peaks at any time.
•   Operating range of the WEC with voltage fluctuation of -20 to +20%.
•   Less Wear & Tear since the system eliminates mechanical brake, which are not needed due to low
    speed generator which runs at maximum speed of 33 rpm and uses Air Brakes.
•   Three Independent Braking System.
•   Generator achieving rated output at only 33 rpm.
•   Incorporates lightning protection system, which includes blades.
•   Starts Generation of power at wind speed of 3 m/s.

Enercon (India) Ltd has secured and facilitated the technology transfer for wind based renewable energy
generation from Enercon GmbH, has established a manufacturing plant at Daman in India, where along
with other components the "Synchronous Generators" using "Vacuum Impregnation" technology are
manufactured.

        A.4.4   Estimated amount of emission reductions over the chosen crediting period:
>>
Crediting Period for the Project: fixed for 10 years
                Years                    Annual estimation of emission reductions in
                                         tones of CO2e


 25 October 2007 to 31March2008                           22,565
  01 April 2008 to 31 March 2009                          65,774
  01 April 2009 to 31 March 2010                          65,774
  01 April 2010 to 31 March 2011                          65,774
  01 April 2011 to 31 March 2012                          65,774
  01 April 2012 to 31 March 2013                          65,774
  01 April 2013 to 31 March 2014                          65,774
  01 April 2014 to 31 March 2015                          65,774
  01 April 2015 to 31 March 2016                          65,774
  01 April 2016 to 31 March 2017                          65,774
 01 April 2017 to 24 October 2017                         43,209
Total estimated reductions (tonnes of                    657,740
               CO2e)
    Total number of crediting years                         10

  Annual average over the crediting                       65,774
period of estimated reductions (tonnes
               of CO2e)
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        A.4.5. Public funding of the project activity:
>>
There is no ODA financing involved in the Project.

SECTION B. Application of a baseline and monitoring methodology


B.1.    Title and reference of the approved baseline and monitoring methodology applied to the
project activity:
>>
The approved consolidated baseline and monitoring methodology ACM0002 Version 6.0 (19 May 2006)
has been used. The titles of these baseline and monitoring methodologies are “Consolidated baseline
methodology for grid-connected electricity generation from renewable sources” and “Consolidated
monitoring methodology for grid-connected electricity generation from renewable sources.

B.2      Justification of the choice of the methodology and why it is applicable to the project
activity:
>>
The Project is wind based renewable energy source, zero emission power project connected to the
Karnataka state grid, which forms part of the Southern regional electricity grid. The Project will displace
fossil fuel based electricity generation that would have otherwise been provided by the operation and
expansion of the fossil fuel based power plants in Southern regional electricity grid.

The approved consolidated baseline and monitoring methodology ACM0002 Version 6 is the choice of
the baseline and monitoring methodology and it is applicable because:
• the Project is grid connected renewable power generation project activity
• the Project represents electricity capacity additions from wind sources
• the Project does not involve switching from fossil fuel to renewable energy at the site of project
    activity since the Project is green-field electricity generation capacities from wind sources at sites
    where there was no electricity generation source prior to the Project, and
• the geographical and system boundaries of the Southern electricity grid can be clearly identified and
    information on the characteristics of the grid is available.

B.3.    Description of the sources and gases included in the project boundary
>>
According to ACM0002, for the baseline emission factor, the spatial extent of the project boundary
includes the project site and all power plants connected physically to the electricity system that the CDM
project power plant is connected to.

The Indian electricity system is divided into five regional grids, viz. Northern, Eastern, Western,
Southern, and North-Eastern. Each grid covers several states. As the regional grids are interconnected,
there is inter-state and inter-regional exchange. A small power exchange also takes place with
neighbouring countries like Bhutan and Nepal.

Power generation and supply within the regional grid is managed by Regional Load Dispatch Centre
(RLDC). The Regional Power Committees (RPCs) provide a common platform for discussion and
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solution to the regional problems relating to the grid. Each state in a regional grid meets its demand with
its own generation facilities and also with allocation from power plants owned by the Central Sector such
as NTPC and NHPC etc. Specific quotas are allocated to each state from the Central Sector power plants.
Depending on the demand and generation, there are electricity exports and imports between states in the
regional grid. The regional grid thus represents the largest electricity grid where power plants can be
dispatched without significant constraints and thus, represents the “project electricity system” for the
Project. As the Project is connected to the Southern regional electricity grid, the Southern grid is the
“project electricity system”.

Accordingly, the project boundary encompasses the physical extent of the Southern regional Electricity
grid which include the project site and all the power plants connected physically to the electricity system


            Source                           Gas      Included?      Justification/ Explanation
            Electricity generation from      CO2      Included       Main emission source
            power plants connected to        CH4      Excluded       This source is not required to be
            the Southern Grid                                        estimated for wind energy projects
                                                                     under ACM0002
Baseline




                                             N2O      Excluded       This source is not required to be
                                                                     estimated for wind energy projects
                                                                     under ACM0002
            Electricity generation from      CO2      Excluded       Wind energy generation does not have
Activity
Project




            the Project                      CH4      Excluded       any direct GHG emissions.
                                             N2O      Excluded


B.4.    Description of how the baseline scenario is identified and description of the identified
baseline scenario:

>>
According to ACM0002, for project activities that do not modify or retrofit an existing electricity generation
facility, the baseline scenario is the following:

Electricity delivered to the grid by the project would have otherwise been generated by the operation of
grid-connected power plants and by the addition of new generation sources, as reflected in the combined
margin (CM) calculations described below.

As the Project does not modify or retrofit an existing generation facility, the baseline scenario is the
emissions generated by the operation of grid-connected power plants and by the addition of new
generation sources. This is estimated using calculation of Combined Margin multiplied by electricity
delivered to the grid by the Project.

B.5.    Description of how the anthropogenic emissions of GHG by sources are reduced below
those that would have occurred in the absence of the registered CDM project activity (assessment
and demonstration of additionality): >>

Step 0: Preliminary screening based on the starting date of the project activity
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If project participants wish to have the crediting period starting prior to the registration of their project
activity, they shall:
a) Provide evidence that the starting date of the CDM project activity falls between 1 January 2000 and
   the date of the registration of a first CDM project activity, bearing in mind that only CDM project
   activities submitted for registration before 31 December 2005 may claim for a crediting period
   starting before the date of registration.
b) Provide evidence that the incentive from the CDM was seriously considered in the decision to
   proceed with the project activity. This evidence shall be based on (preferably official, legal and/or
   other corporate) documentation that was available at, or prior to, the start of the project activity.

The additionality of the project is being proved using additionality tool Version 2.

The Project start date is prior to the date of validation of the PDD.

Wind power projects prior to the implementation Project were required to share CDM revenues with
KPTCL in accordance with the PPAs approved by Karnataka Electricity Regulatory Commission
(KERC). While KPTCL requested KERC to retain the sharing of CDM revenues, KERC removed the
sharing of CDM revenues with KPTCL while approving the PPAs for the Project recognizing the nascent
stage of the CDM market and potential adverse impact on new investments. The various regulatory
orders that a) allowed CDM benefits to be shared between KPTCL and the developers for earlier projects,
and b) did not allow KPTCL to share CDM benefits with developers will be provided to the validator.

Enercon’s management had considered CDM benefits in wind power development and already had
experience with CDM process (CERUPT tender of 2001, Letter of Intent for other wind power projects in
Karnataka in December 2003, etc.). It had also informed its customers of the CDM benefits. Evidence
for this is available which will be provided to the validator.

Enercon had entered into discussions with a CER purchaser for purchase of emission reductions and a
Memorandum of Understanding was signed on 1st July 2005, which is prior to the start date of the Project.

Step 1: Identification of alternatives to the project activity consistent with current laws and
regulations
Sub-step 1a. Define alternatives to the project activity:
1. Identify realistic and credible alternative(s) available to the project participants or similar project
developers that provide outputs or services comparable with the proposed CDM project activity. These
alternatives are to include:
      The proposed project activity not undertaken as a CDM project activity;
      All other plausible and credible alternatives to the project activity that deliver outputs and on services
      (e.g. electricity, heat or cement) with comparable quality, properties and application areas;
      If applicable, continuation of the current situation (no project activity or other alternatives
      undertaken).
Alternative(s) available to the project participants or similar project developers include:
(a)     The Project is not undertaken as a CDM project activity.
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(b)   Setting up of comparable utility scale fossil fuel fired or hydro power projects that supply to the
      Karnataka grid under a PPA.
(c)   Continuation of the current situation where no project activity or any of the above Alternatives are
      undertaken would not be applicable as Karnataka had energy (MU) shortages of 0.7% and peak
      (MW) shortages of 9.8% in 2005-06 (Source: Southern Region Power Sector Profile, August 2006,
      Ministry of Power).
Sub-step 1b. Enforcement of applicable laws and regulations
2. The alternative(s) shall be in compliance with all applicable legal and regulatory requirements, even
   if these laws and regulations have objectives other than GHG reductions, e.g. to mitigate local air
   pollution. This sub-step does not consider national and local policies that do not have legally-binding
   status.
3. If an alternative does not comply with all applicable legislation and regulations, then show that, based
   on an examination of current practice in the country or region in which the law or regulation applies,
   those applicable legal or regulatory requirements are systematically not enforced and that non-
   compliance with those requirements is widespread in the country. If this cannot be shown, then
   eliminate the alternative from further consideration.
4. If the proposed project activity is the only alternative amongst the ones considered by the project
   participants that is in compliance with all regulations with which there is general compliance, then the
   proposed CDM project activity is not additional.
There are no legal and regulatory requirements that prevent Alternatives (a) and (b) from occurring.

Proceed to Step 2 (Investment analysis) or Step 3 (Barrier analysis). (Project participants may also
select to complete both steps 2 and 3.)

Step 2: Investment Analysis
Determine whether the proposed project activity is the economically or financially less attractive than
other alternatives without the revenue from the sale of certified emission reductions (CERs). To conduct
the investment analysis, use the following sub-steps:
Sub-step 2a. - Determine appropriate analysis method
1. Determine whether to apply simple cost analysis, investment comparison analysis or benchmark
     analysis (sub-step 2b). If the CDM project activity generates no financial or economic benefits other
     than CDM related income, then apply the simple cost analysis (Option I). Otherwise, use the
     investment comparison analysis (Option II) or the benchmark analysis (Option III).
Sub-step 2b. – Option I. Apply simple cost analysis
2. Document the costs associated with the CDM project activity and demonstrate that the activity
     produces no economic benefits other than CDM related income.
Sub-step 2b. – Option II. Apply investment comparison analysis
3. Identify the financial indicator, such as IRR, NPV, cost benefit ratio, or unit cost of service (e.g.,
     levelized cost of electricity production in $/kWh or levelized cost of delivered heat in $/GJ) most
     suitable for the project type and decision-making context.
Sub-step 2b. – Option III. Apply benchmark analysis
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4. Identify the financial indicator, such as IRR, NPV, cost benefit ratio, or unit cost of service (e.g.,
   levelized cost of electricity production in $/kWh or levelized cost of delivered heat in $/GJ) most
   suitable for the project type and decision context.

Option I – Simple cost analysis is not applicable as the project activity sells electricity to the grid and
obtains economic benefits in the form of electricity tariffs.
Enercon proposes to use Option III – Benchmark analysis and the financial indicator that is identified is
the post-tax return on equity or the equity IRR.
The post tax return on equity and equity IRR is used as the appropriate financial indicator because in the
Indian power sector, a 14% post tax return on equity is an established benchmark for projects in public or
private sector based on cost-plus regulations (Source: Central Electricity Regulatory Commission, Terms
and Conditions of Tariff, Regulations 2004 dated 26 March 2004) for utility scale power plants (similar to
Alternative (b)). Incentives, foreign exchange variations and efficiency in operations are in addition to
this benchmark of 14%.
For determining the tariffs for wind power projects, the electricity regulatory commissions of the state of
Rajasthan and Gujarat have considered the return on equity at 14% while the electricity regulatory
commissions of the state of Madhya Pradesh, Maharashtra and Karnataka have considered the return on
equity at 16%. (Source: RERC Order dated 29 September 2006).
There are some essential differences between the Project (whether implemented with or without CDM
revenues) and the Alternatives identified in Sub-step 1(b) (utility scale fossil fuel and hydro projects).
These should be taken into account while setting the appropriate level of equity IRR.

 •   The project activity tariff structure is a single-part tariff structure as compared to utility scale fossil
     fuel and hydro projects, which have two-part tariff structure. This implies that project activity
     carries a higher investment risk than the utility scale fossil fuel and hydro projects (Alternative (b))
     where the investment recovery is decoupled from the level of actual generation achieved by the
     project due to variations in offtake.
     Thus, in case of the project activity, issues such as transmission unavailability, back-down of
     generation or part-load operations, which are beyond the control of the investors are likely to affect
     the project activity more severely and therefore the project activity investors would require higher
     rate of return to compensate them for these additional risks.
 •   In case of utility scale fossil fuel and hydro projects (Alternative (b)), these are by reference to cost-
     plus approach whereby the projects recover their full investment cost each year if they are able to
     reach specified level of plant availability. In case of the Project, it does not recover its full
     investment cost in the initial years as the tariffs are back-loaded. This increases the investment risks
     in the project activity compared to the alternatives.
Based on the above considerations, 16% post-tax equity IRR is considered to be the appropriate post-tax
equity return. If the Project has a post-tax equity IRR of less than 16%, then it can be considered to be
additional.

Sub-step 2c. Calculation and comparison of financial indicators (only applicable to options II and III):
5. Calculate the suitable financial indicator for the proposed CDM project activity and, in the case of
   Option II above, for the other alternatives. Include all relevant costs (including, for example, the
   investment cost, the operations and maintenance costs), and revenues (excluding CER revenues, but
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    including subsidies/fiscal incentives where applicable), and, as appropriate, non-market cost and
    benefits in the case of public investors.
6. Present the investment analysis in a transparent manner and provide all the relevant assumptions in
   the CDM-PDD, so that a reader can reproduce the analysis and obtain the same results. Clearly
   present critical techno-economic parameters and assumptions (such as capital costs, fuel prices,
   lifetimes, and discount rate or cost of capital). Justify and/or cite assumptions in a manner that can be
   validated by the DOE. In calculating the financial indicator, the project’s risks can be included
   through the cash flow pattern, subject to project-specific expectations and assumptions (e.g. insurance
   premiums can be used in the calculation to reflect specific risk equivalents).
7. Assumptions and input data for the investment analysis shall not differ across the project activity and
   its alternatives, unless differences can be well substantiated.
8. Present in the CDM-PDD submitted for validation a clear comparison of the financial indicator for
   the proposed CDM activity and:
            (a)      The alternatives, if Option II (investment comparison analysis) is used. If one of the other
                     alternatives has the best indicator (e.g. highest IRR), then the CDM project activity can
                     not be considered as the most financially attractive;
            (b)      The financial benchmark, if Option III (benchmark analysis) is used. If the CDM project
                     activity has a less favourable indicator (e.g. lower IRR) than the benchmark, then the
                     CDM project activity cannot be considered as financially attractive.
Detailed assumptions used and the results of financial analysis for Panama Infrastructure, the project with
the highest equity IRR, is presented below.

 Owner:            Panama Infrastructure
 Project:         1.6 MW
 Location :       Karnataka



 Assumptions for Financial Model



 Capacity of Machines in kW                                                     800
 Number of Machines                                                               2
 Project Capacity in MW                                                         1.60
 Project Commissioning Date                                                 6-Mar-06
 Project Cost (Rs. Million)                                                      76
 Project Cost per MW (Rs. In Millions)                                          47.5



 Operations
   Plant Load Factor                                                          26.5%
   Insurance Charges @ % of capital cost                                      0.18%
   Operation & Maintenance Cost base year @ % of capital cost                 1.25%
   % of escalation per annum on O & M Charges                                  5.0%
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Tariff
  Base year Tariff for 10 years - Rs./Kwh                                                3.40
  Annual Escalation (Rs./kWh per Year)                                                   0.00

                                                                              Cost plus 16%
Tariff applicable after 10 years (Rs/kWh)
                                                                              return on equity




Project Cost                                                                     Rs Million
Land and Infrastructure, Generator & Electrical Equipments, Mechanical
Equipments, Civil Works, Instrumentation & Control, Other Project Cost, Pre
operative Expenses, etc.
Total Project Cost                                                                            76



Means of Finance                                                                                    Rs Million

Own Source                                                                               25%               19.00

Term Loan                                                                                75%               57.00

Total Source                                                                                               76.00

Terms of Loan
  Interest Rate                                                                        9.00%
  Tenure                                                                                 12.0      Years
  Moratorium                                                                                   6   Months



Income Tax Depreciation Rate (Written Down Value basis)
  on Wind Energy Generators                                                              80%
  On other Assets                                                                        10%

Book Depreciation Rate (Straight Line Method basis)
  On all assets                                                                        7.86%
Book Depreciation up to (% of asset value)                                               90%



Income Tax
  Income Tax rate                                                                        30%
  Minimum Alternate Tax                                                                  10%
  Surcharge                                                                              10%
  Cess                                                                                    2%


Working capital
 Receivables (no of days)                                                                  45
 O & m expenses (no of days)                                                               30
 Working capital interest rate                                                           12%


CER Revenues
 CER Price in US$                                                                        6.50
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   Exchange rate Rs./US$*                                                    45.34
 * RBI reference rate as of 15 November 2006


 Crediting period starts                                              15-Sep-07
 Length of Crediting period                                                  10


 Baseline Emission Factor for Southern Region (tCO2/GWh)                 932.04


The equity IRR for this sub project without CDM revenues is 11.56%, which improves to 15.07% after
considering CDM revenues.
The financial analysis also demonstrates that the equity IRRs of other projects are in the range of 9% to
11.56% i.e. less than the benchmark rate of 16%. Equity IRRs of all sub projects that comprise the project
activity are provided in Appendix 3.

Sub-step 2d. Sensitivity analysis (only applicable to options II and III):
9. Include a sensitivity analysis that shows whether the conclusion regarding the financial attractiveness
   is robust to reasonable variations in the critical assumptions. The investment analysis provides a valid
   argument in favor of additionality only if it consistently supports (for a realistic range of assumptions)
   the conclusion that the project activity is unlikely to be the most financially attractive (as per step 2c
   para 8a) or is unlikely to be financially attractive (as per step 2c para 8b).
Sensitivity analysis of the Equity IRR to the Plant Load Factor (the most critical assumption) has been
carried out considering a plant load factor of 23% and 28% (the range indicated in KERC Order dated 18
January 2005). Plant Load Factor is the key variable encompassing variation in wind profile, variation in
off-take (including grid availability) including machine downtime. The post tax Equity IRRs at the stated
PLFs are as follows:


                                                      PLF at 23%                     PLF at 28%
       Post tax Equity IRR without                         5.59%                      14.41%
       CER revenues
       Post tax Equity IRR with CER                        8.42%                      18.16%
       revenues


As can be seen from above, the Project is not the most financially attractive (as per step 2c para 8a) we
proceed to Step 4 (Common practice analysis).

Step 4. Common practice analysis

Sub-step 4a. Analyze other activities similar to the proposed project activity:

1. Provide an analysis of any other activities implemented previously or currently underway that are
   similar to the proposed project activity. Projects are considered similar if they are in the same
   country/region and/or rely on a broadly similar technology, are of a similar scale, and take place in a
   comparable environment with respect to regulatory framework, investment climate, access to
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    technology, access to financing, etc. Other CDM project activities are not to be included in this
    analysis. Provide quantitative information where relevant.

Sub-step 4b. Discuss any similar options that are occurring:

2. If similar activities are widely observed and commonly carried out, it calls into question the claim
   that the proposed project activity is financially unattractive (as contended in Step 2) or faces barriers
   (as contended in Step 3). Therefore, if similar activities are identified above, then it is necessary to
   demonstrate why the existence of these activities does not contradict the claim that the proposed
   project activity is financially unattractive or subject to barriers. This can be done by comparing the
   proposed project activity to the other similar activities, and pointing out and explaining essential
   distinctions between them that explain why the similar activities enjoyed certain benefits that
   rendered it financially attractive (e.g., subsidies or other financial flows) or did not face the barriers to
   which the proposed project activity is subject.
3. Essential distinctions may include a serious change in circumstances under which the proposed CDM
   project activity will be implemented when compared to circumstances under which similar projects
   where carried out. For example, new barriers may have arisen, or promotional policies may have
   ended, leading to a situation in which the proposed CDM project activity would not be implemented
   without the incentive provided by the CDM. The change must be fundamental and verifiable.

We analyze the extent to which wind energy projects have diffused in the electricity sector in Karnataka.
In 2004 – 05, wind electricity generation was 485.57 GWh and the total electricity availability at bus-bar
in the state of Karnataka was 33,523.92 GWh (Source: CEA General Review 2006). This works out to
1.45%, showing that wind energy power generation is insignificant as compared to other power project
generation sources in Karnataka.

Installed capacity of wind energy generation sources stood at 276 MW as of 31 March 2005 (Source:
CEA General Review 2006). There are approximately 201 MW wind energy projects that are currently in
the CDM pipeline (UNFCCC website) and more are expected to follow.

Clearly, wind power project development in Karnataka is insignificant when compared to the power
sector of Karnataka. Further, wind power project development is substantially dependent on CDM
mechanism and thus is not common practice.

Sub-steps 4a and 4b are satisfied.

Step 5. Impact of CDM registration

Explain how the approval and registration of the project activity as a CDM activity, and the attendant
benefits and incentives derived from the project activity, will alleviate the economic and financial hurdles
(Step 2) or other identified barriers (Step 3) and thus enable the project activity to be undertaken.

Registering the project activity as a CDM activity provides a significant amount of revenue, improving
the project’s cash flow and improving the equity IRR by 3.74%. The revenues from sale of the Certified
Emission Reductions would enhance the viability of the project and would partially offset the risks
associated with the possible changes in policy, wind regime, project implementation risks (time and cost
overruns), etc. Further, CER revenues will be high quality cash flows coming from creditworthy parties
and denominated in foreign currency. The CDM revenues will attract new players to wind investments in
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Karnataka, as they provide compensation for the regulatory and project risks implicit in the wind power
projects.

B.6.      Emission reductions:

         B.6.1. Explanation of methodological choices:
>>
According to the approved baseline methodology ACM0002, the emission reductions ERy by the project
activity during a given year “y1” is

ERy = BEy – PEy – Ly……………….(1)

Where: BEy         is the baseline emissions
       PEy         is project activity emissions and;
       Ly          is the amount of emissions leakage resulting from the project activity.

Baseline Emissions for the amount of electricity supplied by project activity, BEy is calculated as

BEy = EGy * EFy …………………….(2)

where EGy is the electricity supplied to the grid, EFy is the CO2 emission factor of the grid as calculated
below.

The emission factor EFy of the grid is represented as a combination of the Operating Margin (OM) and
the Build Margin (BM). Considering the emission factors for these two margins as EFOM,y and EFBM,y,
then the EFy is given by:

EFy = wOM * EFOM,y + wBM * EFBM,y…………………………..(2)

with respective weight factors wOM and wBM (where wOM + wBM = 1).

The Operating Margin emission factor

As per ACM0002, dispatch data analysis should be the first methodological choice. However, this option
is not selected because the information required to calculate OM based on dispatch data is not available in
the public domain for the Southern electricity regional grid.

The Simple Operating Margin approach is appropriate to calculate the Operating Margin emission factor
applicable in this case. As per ACM 0002 the Simple OM method can only be used where low cost must
run resources constitute less than 50% of grid generation based on average of the five most recent years.
The generation profile of the Southern grid in the last five years is as follows:



1
  Throughout the document, the suffix y denotes that such parameter is a function of the year y, thus to be monitored at least
annually.
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    Generation in GWh                         2004-05          2003-04         2002-03          2001-02         2000-01
    Low cost/must run sources
      Hydro                                       24,951          16,943           18,288          26,260           29,902
      Wind & Renewables                            3,256           1,865            1,607           1,456            1,262
      Nuclear                                      4,408           4,700            4,390           5,244            4,331
    Other sources
      Coal                                        99,010          98,435          92,053           84,032          83,292
      Diesel                                       2,434           3,295           4,379            4,155           2,868
      Gas                                         12,428          14,214          13,950           10,331           7,132
    Total Generation                             146,487         139,451         134,667          131,478         128,787
    Low cost/must run sources                     32,615          23,508          24,285           32,960          35,496
    Low cost/must run sources                       22%             17%             18%              25%             28%

Source: Table 3.4 of CEA General Review 2004-05, 2003-04, 2002-03, 2001-02, 2000-01

From the available information it is clear that low cost/must run sources account for less than 50% of the
total generation in the Southern grid in the last five years. Hence the Simple OM method is appropriate to
calculate the Operating Margin Emission factor applicable.


Build Margin Emission Factor

The Build Margin emission factor EF_BMy (tCO2/GWh) is given as the generation-weighted average
emission factor of the selected representative set of recent power plants represented by the 5 most recent
plants or the most recent 20% of the generating units built (summation is over such plants specified by
k):2

EFBM,y = [∑i Fi,m,y*COEFi] / [∑k GENk,m,y]………………………..(5)

as the default method. The summation over i and k is for the fuels and electricity generation of the plants
in sample m mentioned above.

The choice of method for the sample plant is the most recent 20% of the generating units built as this
represents a significantly larger set of plants, for a large regional electricity grid have a large number of
power plants connected to it, and is therefore appropriate.

The Central Electricity Authority, Ministry of Power, Government of India has published a database of
Carbon Dioxide Emission from the power sector in India based on detailed authenticated information
obtained from all operating power stations in the country. This database i.e. The CO2 Baseline Database
provides information about the Operating Margin and Build Margin Emission Factors of all the regional
electricity grids in India. The Operating Margin in the CEA database is calculated ex ante using the
Simple OM approach and the Build Margin is calculated ex ante based on 20% most recent capacity
additions in the grid based on net generation as described in ACM0002. We have, therefore, used the



2
 The project participant is to demonstrate which is appropriate for the proposed project to the Operational Entity, otherwise,
more conservative one is selected.
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Operating Margin and Build Margin data published in the CEA database, for calculating the Baseline
Emission Factor.

Combined Margin Emission Factor

As already mentioned, baseline emission factor (EFy) of the grid is calculated as a combined margin
(CM), calculated as the weighted average of the operating margin (OM) and build margin (BM) factor. In
case of wind power projects default weights of 0.75 for EFOM and 0.25 for EFBM are applicable as per
ACM0002. No alternate weights are proposed.

Using the values for operating margin and build margin emission factors provided in the CEA database
and their respective weights for calculation of combined margin emission factor, the baseline carbon
emission factor (CM) is 932.04 tCO2e/GWh or 0.93204 tCO2e/MWh.

Project Emissions:

The project activity uses wind power to generate electricity and hence the emissions from the project
activity are taken as nil.

PEy = 0

Leakage:

Emissions Leakage on account of the project activity is ignored in accordance with ACM0002.

Ly = 0


         B.6.2. Data and parameters that are available at validation:
         >>

Data / Parameter:             EFOM,y
Data unit:                    tCO2e/MWh
Description:                  Operating Margin Emission Factor of Southern Regional Electricity Grid
Source of data used:          “CO2 Baseline Database for Indian Power Sector” published by the Central Electricity
                              Authority, Ministry of Power, Government of India.

                              The “CO2 Baseline Database for Indian Power Sector” is available at www.cea.nic.in

Value applied:
                               2002 – 03       0.9970
                               2003 – 04       1.0094
                               2004 – 05       1.0038
Justification of the choice
of data or description of     Operating Margin Emission Factor has been calculated by the Central Electricity
measurement        methods    Authority using the simple OM approach in accordance with ACM0002.
and procedures actually
applied :
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  Data / Parameter:             EFBM,y
  Data unit:                    tCO2e/MWh
  Description:                  Build Margin Emission Factor of Southern Regional Electricity Grid
  Source of data used:          “CO2 Baseline Database for Indian Power Sector” published by the Central Electricity
                                Authority, Ministry of Power, Government of India.

                                The “CO2 Baseline Database for Indian Power Sector” is available at www.cea.nic.in

  Value applied:                0.7180
  Justification of the choice
  of data or description of     Build Margin Emission Factor has been calculated by the Central Electricity Authority
  measurement        methods    in accordance with ACM0002.
  and procedures actually
  applied :




         B.6.3 Ex-ante calculation of emission reductions:
         >>
  Ex-ante calculation of emission reductions is equal to ex-ante calculation of baseline emissions as project
  emissions and leakage are nil.

  Baseline emission factor (combined margin)
  = 932.04 tCO2e/GWh

  Annual electricity supplied to the grid by the Project
  = 30.40 MW (Capacity) x 26.5% (PLF) x 8760 (hours) / 1000 GWh
  = 70.57056 GWh

  Annual baseline emissions
  = 932.04 tCO2e/GWh x 70.57056 GWh
  = 65,774 tCO2e

           B.6.4    Summary of the ex-ante estimation of emission reductions:
           >>
Year                            Estimation of     Estimation of baseline         Estimation of     Estimation of
                                project activity  emissions (tonnes of           leakage           overall emission
                                emissions (tonnes CO2e)                          (tonnes of        reductions
                                of CO2e)                                         CO2e)             (tonnes of CO2e)

   25 October 2007 to                      0                    22,565                   0               22,565
     31March2008
01 April 2008 to 31 March                  0                    65,774                   0               65,774
           2009
01 April 2009 to 31 March                  0                    65,774                   0               65,774
           2010
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 01 April 2010 to 31 March           0                   65,774                 0              65,774
            2011
 01 April 2011 to 31 March           0                   65,774                 0              65,774
            2012
 01 April 2012 to 31 March           0                   65,774                 0              65,774
            2013
 01 April 2013 to 31 March           0                   65,774                 0              65,774
            2014
 01 April 2014 to 31 March           0                   65,774                 0              65,774
            2015
 01 April 2015 to 31 March           0                   65,774                 0              65,774
            2016
 01 April 2016 to 31 March           0                   65,774                 0              65,774
            2017
01 April 2017 to 24 October          0                   43,209                 0              43,209
            2017
Total (tonnes of CO2e)               0                  657,740                 0             657,740




  B.7     Application of the monitoring methodology and description of the monitoring plan:
          B.7.1 Data and parameters monitored:

  Data / Parameter:        EGy
  Data unit:               MWh (Mega-watt hour)
  Description:             Net electricity supplied to the grid by the Project
  Source of data to be     Electricity supplied to the grid as per the tariff invoices raised on
  used:                    KPTCL/BESCOM/HESCOM.
  Value of data applied    Annual electricity supplied to the grid by the Project
  for the purpose of       = 30.40 MW (Capacity) x 26.5% (PLF) x 8760 (hours) MWh
  calculating  expected    = 70570.56MWh
  emission reductions in
  section B.5
  Description         of   Net electricity supplied to grid will be measured by main meters (export and
  measurement methods      import). The procedures for metering and meter reading will be as per the
  and procedures to be     provisions of the power purchase agreement. Refer Annex – 4 for an illustration
  applied:                 of the provisions for measurement methods.
  QA/QC procedures to      QA/QC procedures will be as implemented by KPTCL/BESCOM pursuant to the
  be applied:              provisions of the power purchase agreement. Refer Annex – 4 for an illustration
                           of the provisions for QA/QC procedures.
  Any comment:             The data is archived for a period up to 2 years after the finishing of crediting
                           period.

          B.7.2   Description of the monitoring plan:
  >>
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Approved monitoring methodology ACM0002 / Version 06 Sectoral Scope: 1, “Consolidated monitoring
methodology for zero-emissions grid-connected electricity generation from renewable sources”, by CDM
- Meth Panel is proposed to be used to monitor the emission reductions.

This approved monitoring methodology requires monitoring of the following:
• Electricity generation from the project activity; and
• Operating margin emission factor and build margin emission factor of the grid, where ex post
    determination of grid emission factor has been chosen
Since the baseline methodology is based on ex ante determination of the baseline, the monitoring of
operating margin emission factor and build margin emission factor is not required.

The sole parameter for monitoring is the electricity supplied to the grid. The Project is operated and
managed by Enercon (India) Ltd. The operational and management structure implemented by Enercon is
as follows:

    STRUCTUR                       RESPONSIBILITY

Managing Director
Enercon India Ltd


     CDM Team                    Review, Corrective action
     co-ordinator


    Corporate                    Review, internal
    CDM Team


   Regional Service              Check, authorize & forward
       Heads                     monitoring data


     O&M Team                    Monitor, record, report and
                                 archive data



Training and maintenance:

Training on the machine is an essential pre-requisite, to ensure necessary safety of man and machine.
Further, in order to maximize the output from the Wind Energy Converters (WECs), it is extremely
essential, that the engineers and technicians understand the machines and keep them in good health. In
order to ensure, that Enercon’s service staff is deft at handling technical snags on top of the turbine, the
necessity of ensuring that they are capable of climbing the tower with absolute ease and comfort has been
established. The Enercon Training Academy provides need-based training to meet the training
requirements of Enercon projects. The training is contemporary, which results in imparting focused
knowledge leading to value addition to the attitude and skills of all trainees. This ultimately leads to
creativity in problem solving.
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B.8     Date of completion of the application of the baseline study and monitoring methodology and
the name of the responsible person(s)/entity(ies)
>>
Date of completion: 12/02/2007

Name of responsible person/entity:
PricewaterhouseCoopers (not a Project Participant)

SECTION C. Duration of the project activity / crediting period

C.1    Duration of the project activity:

       C.1.1. Starting date of the project activity:
>>
17/08/2005

       C.1.2. Expected operational lifetime of the project activity:
>>
20 years

C.2    Choice of the crediting period and related information:

       C.2.1. Renewable crediting period

               C.2.1.1.        Starting date of the first crediting period:
>>

               C.2.1.2.        Length of the first crediting period:
>>

       C.2.2. Fixed crediting period:

               C.2.2.1.        Starting date:
>>
25/10/2007

               C.2.2.2.        Length:
>>
10 years
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SECTION D. Environmental impacts
>>

D.1.     Documentation on the analysis of the environmental impacts, including transboundary
impacts:
>>
Enercon appointed Aditya Environmental Services Private Limited to conduct Rapid Environmental
Impact Assessment Study, in the districts of Chitradurga and Gadag where the project activity of Enercon
is located, to assess the impact of the project on the local environment

Environmental Impact Assessment (EIA) of this project is not an essential regulatory requirement, as it is
not covered under the categories as described in EIA Notification of 1994 or the Amended Notification of
2006. However, Enercon conducted the EIA to study impacts on the environment resulting from the
project activity.

The EIA study included identification, prediction and evaluation of potential impacts of the CDM
activities on air, water, noise, land, biological and socio-economic environment within the study area. The
ambient air concentrations of Suspended Particulate Matter, Respirable Particulate Matter, Oxides of
Nitrogen, Sulphur dioxide and Carbon Monoxide were monitored and were found under limits as
specified by CPCB. The noise levels were observed through out the study period and were found to be in
the permissible range. Water quality monitoring studies were carried out for determination of physico-
chemical characteristics of bore wells. The ph level of water was found to be under the specified limits.

The study area represents part of Chitradurga and Gadag districts. The terrain comprises hilly areas
which are sparingly populated, the hills are generally covered with shrubs and grass and trees are not
found on the hilltops. Moreover the project area doesn’t fall under any protected land for wildlife and it
has no adverse ecological impacts on the surroundings, flora and fauna found in the vicinity of the project
area. The wind-farms do not effect the path of migratory birds.

D.2.    If environmental impacts are considered significant by the project participants or the host
Party, please provide conclusions and all references to support documentation of an environmental
impact assessment undertaken in accordance with the procedures as required by the host Party:
>>
EIA demonstrated that there is no major impact on the environment due to the installation and operation
of the windmills. The local ecology is not likely to get impacted by this type of project activity. The local
population confirmed that there is no noise or dust nuisance due to windmills. The EIA also ruled out any
adverse impacts due to the project activity.

SECTION E. Stakeholders’ comments
>>

E.1.   Brief description how comments by local stakeholders have been invited and compiled:
>>
The comments from local stakeholders were invited through local stakeholder meeting conducted on 2
September at Arashinagundi Village, Hiriyur in Chitradurga District and 15 June 2006 in Dhoni,
Mundaragi in Gadag district. An advertisement was placed in a local newspaper in Vijaya Karnataka on
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19 August 2006 inviting the local stakeholders for the meeting for the Chitradurga district projects and in
Vijaya Karnataka on 4 June 2006 for the Gadag district projects.

The local stakeholder consultation meeting had representatives from the nearby villages, representatives
of Enercon and representative of Aditya Environmental Services (consultant to Enercon) in Chitradurga
district and representative of Care Sustainability (consultant to Enercon) in Gadag district. The minutes
of the two meetings are set out in Appendix 2.

E.2.    Summary of the comments received:
>>

Chitradurga district:

The local stakeholders commented that the development of wind projects has helped the local villagers
and provided employment. Further, there is no impact of windmills on the rainfall in the region. The
local stakeholders queried Enercon if any afforestation work is being conducted, impact on ground water,
generation capacity of the machine, if public can purchase the machines and whether revenue land is used
wherever electricity overhead lines pass through.

The local villagers responded to the questions queries made by Enercon by stating that there is no noise
pollution as the projects are located in hilltops and away from villages. Further, there is no water draining
and soil erosion due to wind mills and there has been no problem with No cattle grazing in the hills.
There has been better food production due to better quality of electricity and less load shedding. There
has been no deforestation noticed except while road formation and installation of machines and no
damage or accidents during construction or erection.

Gadag district:

The local stakeholders commented that there is no adverse impact of wind project activities including no
adverse impact on livelihood. The local villages do not use the hill tops or slopes for cattle grazing.
There is no impact on ground water or supply of water to agriculture fields. There is no disturbance or
high noise level due to operation of the wind mills. There have been no accidents and no disturbance or
heavy traffic on account of wind mills. No dust emissions were observed at project site or in the
neighbourhood. The wind projects have not affected migratory path of birds. There have been local
employment opportunities. Improvement in quality of electricity supply has been observed.

The local stakeholders suggested that in addition to planting medicinal plants at the project site, Enercon
should also plant them at the down plains. Enercon should extend help to villagers by providing
“lift/transportation” and additional watchmen should be deployed to warn of forest fire.


E.3.    Report on how due account was taken of any comments received:
>>

Enercon provided the following responses in relation to the comments received from the local
stakeholders in Chitradurga district:
• Enercon is carrying out afforestation work in all the hills where the wind turbines are installed.
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•   There is no impact on ground water due to wind mills.
•   Generation capacity of wind mills is 800 kW.
•   It is possible to purchase wind mills. In Maharashtra, farmers association has purchased one wind
    machine.
•   Revenue land is not being used wherever electrical overhead lines pass. Access to the land is
    required only for line inspection in case of a fault.

Enercon provided the following responses in relation to the comments received from the local
stakeholders in Gadag district:
• Regarding planting medicinal plants, Enercon is currently doing it at the project site and would also
    be planting on the slopes.
• Regarding assistance with transport, Enercon would do their best to provide help to the villagers in
    the emergency cases.
• Regarding forest fire warning/safety, Enercon would be constructing a three feet trench on the slopes
    and around the project site. It has also instructed watchmen and security guards to be vigilant and
    provide warning in the cases of occurrences of forest fires.
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                                              Annex 1

         CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY
Organization:       Enercon (India) Limited
Street/P.O.Box:     A-9, Veera Industrial Estate, Veera Desai Road, Andheri (West)
Building:           Enercon Towers
City:               Mumbai
State/Region:       Maharashtra
Postfix/ZIP:        400 053
Country:            India
Telephone:           +91-22-5522 7794
FAX:                 +91-22-5692 1175
E-Mail:             a.raghavan@enerconindia.net
URL:
Represented by:
Title:              Associate Vice President
Salutation:         Mr.
Last Name:          Raghavan
Middle Name:
First Name:         A
Department:         Corporate
Mobile:             +91-9820045724
Direct FAX:         +91-22-5692 1175
Direct tel:         +91-22-6692 4848 extn. 7169
Personal E-Mail:    a.raghavan@enerconindia.net



Organization:           Japan Carbon Finance, Ltd.
Street/P.O.Box:         6th Floor, 1-3 Kundankita, 4-chrome
Building:               Chiyoda-ku
City:                   Tokyo
State/Region:
Postfix/ZIP:            102-0073
Country:                Japan
Telephone:              +81 3 5212 8870
FAX:                    +81 3 5212 8886
E-Mail:                 jcf@jcarbon.co.jp
URL:                    http://www.japancarbon.co.jp/
Represented by:
Title:                  Director General
Salutation:             Mr.
Last Name:              Ari
Middle Name:
First Name:             Masato
Department:             Carbon Finance Department
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Mobile:
Direct FAX:              +81 3 5212 8886
Direct tel:              +81 3 5212 8878
Personal E-Mail:         m-ari@jcarbon.co.jp
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                                                Annex 2

                        INFORMATION REGARDING PUBLIC FUNDING


There is no ODA being used to fund the project activity.
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                                                Annex 3

                                    BASELINE INFORMATION

The Operating Margin data for the most recent three years and the Build Margin data for the Southern
Region Electricity Grid as published in the CEA database are as follows:

Simple Operating Margin

                                                  tCO2e/GWh
 Simple Operating Margin - 2002-03                       997.02
 Simple Operating Margin - 2003-04                     1,009.37
 Simple Operating Margin - 2004-05                     1,003.76
 Average Operating Margin of last three years          1,003.38

Build Margin

                                                  tCO2e/GWh
 Build Margin                                             717.99

Combined Margin calculations

                                    Weights       tCO2e/GWh
 Operating Margin                      0.75               1003.38
 Build Margin                          0.25                717.99
 Combined Margin                                           932.04

Detailed information on calculation of Operating Margin Emission Factor and Build Margin Emission
Factor is available at www.cea.nic.in.
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                                                Annex 4

                                   MONITORING INFORMATION

•   Metering: Electricity supplied to the grid is metered by the Parties (KPTCL, Enercon and the
    Project) at the high voltage side of the step up transformer installed at the Project Site.

•   Metering Equipment: Metering equipment is electronic trivector meters of accuracy class 0.2%
    required for the Project (both main and check meters). The main meter is installed and owned by the
    Project, whereas check meters are owned by KPTCL. The metering equipment is maintained in
    accordance with electricity standards prevalent in Karnataka. The meters installed are capable of
    recording and storing half hourly readings of all the electrical parameters for a minimum period of 35
    days with digital output.

•   Meter Readings: The monthly meter readings (both main and check meters) is taken jointly by the
    parties on the first day of the following month at 12 Noon. At the conclusion of each meter reading an
    appointed representative of KPTCL and Enercon sign a document indicating the number of Kilowatt-
    hours indicated by the main meter.

•   Inspection of Energy Meters: All the main and check energy meters (export and import) and all
    associated instruments, transformers installed at the Project are of 0.2% accuracy class. Each meter is
    jointly inspected and sealed on behalf of the Parties and is not to be interfered with by either Party
    except in the presence of the other Party or its accredited representatives.

•   Meter Test Checking: All the main and check meters are tested (and calibrated if found necessary)
    for accuracy on annual basis with reference to a portable standard meter. The portable standard meter
    is owned by KPTCL. The main and check meters shall be deemed to be working satisfactorily if the
    errors are within specifications for meters of 0.2 accuracy class. The consumption registered by the
    main meters alone will hold good for the purpose of metering electricity supplied to the grid as long
    as the error in the main meters is within the permissible limits.

    If during the meter test checking,
    • the main meter is found to be within the permissible limit of error and the corresponding check
        meter is beyond the permissible limits, then the meter reading will be as per the main meter as
        usual. The check meter shall, however, be calibrated immediately.
    • the main meter is found to be beyond permissible limits of error, but the corresponding check
        meter is found to be within permissible of error, then the meter reading for the month up to the
        date and time of such test shall be as per the check meter. There will be a revision in the meter
        reading for the period from the previous calibration test up to the current test based on the
        readings of the check meter. The main meter shall be calibrated immediately and meter reading
        for the period thereafter till the next monthly meter reading shall be as per the calibrated main
        meter.
    • both the main meters and the corresponding check meters are found to be beyond the permissible
        limits of error, both the main meters shall be immediately calibrated and the correction applied to
        the reading registered by the main meter to arrive the correct reading of energy supplied for
        metering electricity supplied to the grid for the period from the last month’s meter reading up to
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       the current test. Meter reading for the period thereafter till the next monthly reading shall be as
       per the calibrated main meter.
   •   If during any of the monthly meter readings, the variation between the main meter and the check
       meter is more than the permissible limit for meters of 0.2% accuracy class, all the meters shall be
       re-tested and calibrated immediately.
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                                 Appendix 1 – Location Map

For sub-Projects 1 to 14
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For sub-Projects 15 to 18
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                     Appendix 2 – Minutes of stakeholder consultation meeting

Public Consultation Meeting for Wind Farm Projects as Clean Development Mechanism Projects at
sites – CK 1&2, Gim Sites and VVS, Chitradurga District, Karnataka State.

Venue: Enercon (India) Limited, CK 1 & 2 Site, Arashinagundi Village, Hiriyur, Chitradurga Dist.

Date: 02nd September 2006, 10 am – 12 pm

Members from the Villages:
  1. Sri. Thimmanna
  2. Sri. Kanumappa
  3. Sri. Rajappa
     And 19 participants from the village.

Members from Enercon (India) Ltd., Chitradurga
  1. Mr. C.B.Poonacha
  2. Mr. Sajith
  3. Mr. Fathahulla
  4. Mr. Naveen Kumar
  5. Mr. Ravidhara

Members from Enercon(India) Ltd., Mumbai
  1. Mr. Vivek Sen
  2. Mr. Neeraj Gupta

Members from Aditya Environmental Services Pvt. Ltd.
  1. Mr. Gurmeet Singh

Agenda of the Meeting:
   1. Welcome Address and Introduction
   2. Project Profile, CDM, Environmental and social issues
   3. Description about Wind Energy Conversion.
   4. Suggestions and Opinions
   5. Queries and Responses from the Stakeholders and Co. Authorities respectively.
   6. Vote of Thanks.

   1. Welcome Address: In the Welcome Address, Mr. C.B.Poonacha has briefed about the purpose of
      this Public Meeting, how Wind Mills and Wind Energy are occupied major role in generating
      power thereby rural population is benefited. Further he was pointing out how the benefits of
      employment opportunities, economical growth taken place in the areas. And also he has quoted
      examples of various social and religious activities taken up in the villages, for ex. construction of
      temples, roads through villages etc.

       Then Mr. C.B.Poonacha invited Mr. Thimmanna, Village Panchayat leader to preside over the
       meeting and conducts the further proceedings. And also he has invited village leaders viz. Mr.
       Kanumappa and Mr. Rajappa on the dias.
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   2. Project Profile:

       Mr. Md. Fathahulla: Mr. Md. Fathahulla has described about the Wind Mills and how the Wind
       Power is generated, why it is called Green Energy and our project is emission free and it is
       pollution free energy when compared with Thermal power. He reiterated that in Thermal Power,
       carbon would be emitted into the air, which causes air pollution. He said that the public would
       not have any bad impact by the Wind Mills. When asked by the villagers about the clouds
       running away due to running of Wind Mills and thereby causing deficiency in rainfall, Mr.
       Fathahulla has cleared the doubts of the stakeholders by convincing them about the height of the
       clouds and the height of the Wind Mill Erector. He said we are conducting aforestation and
       drainage work to eradicate the soil erosion from the hills. He also informed that the co-operation
       by the villagers required for successful completion and service of Wind Mills.

       Mr. Ravidhara: Mr. Ravidhara has described to the villagers how the power is converted from
       Wind to Electricity and how the generators are running and generate electricity power. And also
       he has specified where the generated power will be transmitted and at what rate. He has told
       about the safety measures taken in our Wind Erectors and automatic stoppage of m/c with more
       rpm in order to avoid any untoward incidence.

   3. President’s Address:

           a) Sri. Thimmanna who has presided over the meeting has informed the villagers about how
              Wind Mills are helped our Villagers and Farmers, benefits to the unemployed one. And
              we have benefited more from wind mills rather loss of any kind. He also strongly quoted
              that “The economic and social life has changed due to wind mills in and around
              Chitradurga Villages. He extended fullest cooperation for development of such activities
              and also stated that lack of rainfall in the region is not due to Wind Mills. Since last two
              years we had plenty of rainfall. He also pledged that the cooperation from our villagers is
              there in future also and sought the same from Enercon.
           b) Sri. Kanumappa has accepted that the temple work is been completed by Enercon only
              and praised about the social and religious activities by Enercon. Eco friendly project like
              wind power should come up in all villages which will not harm any environmental
              balancing, he specified.
           c) Sri. Rajappa, who has told that there was no rainfall shortage due to Wind Mills.

Questionnaire:
a) By the Stakeholders:
            i)     Are you conducting afforestation work in the hills where the plants are removed?
            Ans: Yes, We are doing afforestation work in all the hills where M/cs are installed.
            ii)    Are there any chances of drying up Ground Water?
            Ans: No, Wind Mills do not use any ground water for its process.
            iii)   What is the generation capacity of the Machine?
            Ans: 800 KW per hour.
            iv)    Is there any scope of purchasing machine by the public?
            Ans: Yes, In Maharashtra farmers association has purchased one machine.
            v)     There is a rumour that revenue land is used wherever the electrical line passes
                   through? Is it true?
            Ans: No, Only line inspection will be done.
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b) By the Company:
           i)      Is there any Noise Pollution by running the Wind Mills?
           Ans: So far no idea. But as it is in hilltops and away from villages such nuisance may not
           happen.
           ii)     Is there any water draining, soil erosion due to Wind Mills?
           Ans: No, such incidence not occurred.
           iii)    Is there any problem for animals grazing in the hills?
           Ans: No, Cattle are grazing in hill areas as usual.
           iv)     How Wind Mills helped in improvement of Crops?
           Ans: By increase in voltage capacity and less load shedding results in increase in food grain
           production.
           v)      Have you observed any deforestation problem?
           Ans: No, Except while forming the roads and installing the machines, there found no
           deforestation is taken place.
           vi)    During construction or erection any damages or accidents occurred?
           Ans: Absolutely not. The Project work is taken up very smoothly and run with more safety
           standards.

For further queries the representatives from ENERCON put forward to the participants that they could
raise any queries within a week and the same can be submitted at ENERCON Office, Bangalore as the
address mentioned in the Paper Notification on 19th Aug. 2006.

Vote of Thanks: Mr. Naveen Kumar thanked the village leaders and villagers who have set aside their
work and shown interest and eagerness to know about the Wind Mills. He also sought cooperation from
all the corners for successful operation of windmills thereby achieving the National Target of self-
sufficiency in Power Sector.
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               MINUTES OF THE PUBLIC CONSULTATION STAKEHOLDERS
                  MEETING HELD AT GADAG, KARNATAKA ON 15/06/06

Venue: The meeting is held at Panchayat office, Dhoni, Mundaragi, GADAG, which is about Nine Km.
From the project site.

The meeting has begun at 3:30pm. There are more than forty people attending the meeting. The
participants are the people from the villages surrounding the project site- Dambal, Dhoni-Thanda,
Kadampura, Katkol, HireVaddatti. Other participants are the panchayat officials- President and Vice
President, Representatives from ENERCON, and CARE SUSTAINABLILTY

The language of meeting is Kannada. In between Hindi was also used.

The meeting began with the appointment of chairman for the meeting Mr. K.S. Narayanpur. The agenda
for the meeting has been as follows:

   •     Welcome to the participants (by representatives from ENERCON)
   •     Brief to the participants about the project and CLEAN DEVELOPMENT MECHANISM (CDM)
   •     Questions and answers: concerns/issues/comments/ about the project and related matters by the
         participants
    • Response from ENERCON
    • Announcement by the representatives of ENERCON
    • Vote of thanks
The list of the participants with their names and signature are in attached sheet.

The meeting proceeded as per agenda

Table below gives the concerns/issues/comments from the participants and response from ENERCON
Sr.    Questions/concerns/issues/com Details of concerns/issues/comments             Response     from
No     ments relating to the CDM expressed by the participants                       ENERCON
       activity
1      How does the project impact All participants expressed that the -
       the general quality of the people establishment of the wind units do not
                                         adversely affect them (villagers around
                                         the project). In brief the projects neither
                                         adversely nor bring significant benefits to
                                         them.
                                         All of them expressed they are happy
                                         with the project activity
2      Any impact on the livelihood of Villagers expressed that their livelihood -
       the villagers                     have not been impacted adversely by the
                                         establishment of the wind units.
                                         The hill tops or slopes have not been used
                                         by them for grazing the cattle.
3      Does the project increase the The following facts have been given by
       employment opportunities          the villagers.                              For   locals with
                                         During the construction stage, most of the ITL(technical
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                                          laborers have been locals.                   training)
                                          During operation stage, at present out of    qualifications,
                                          the six local technical staff, two of them   ENERCON           does
                                          at present are locals.                       provide employment
                                          All security staff are locals. The drivers   in technical category.
                                          are locals.                                  Most of the unskilled
                                                                                       workers are locals.
4     Does the project improves the Improvements in the voltage fluctuations           Conditions            of
      electricity supply to villagers/ and supply are observed. KPCL has               electricity        and
      neighborhood areas               established a Sub Station at Dambal             voltage fluctuations
                                       There are more than six hundred water           have improved this
                                       pumps (for agricultural activities ) in the     year compared to last
                                       neighborhood. Operations of them have           year, and is expected
                                       become for time and without fluctuations        to improve further.
                                       at present                                      Only KPCL and
                                                                                       ENERCON have the
                                                                                       functioning       wind
                                                                                       units at the present.
5     Would the project result in         Water Table has decreased in recent          -
      drinking      water     shortage/   times in the neighborhood agricultural
      increase in shortage of water for   areas.   Villagers    themselves      have
      agriculture                         expressed that this is not due to the
                                          establishment of wind units, but due to
                                          the increase in the agricultural activities
                                          and number of bore wells in the areas.
6     Would the erection of the wind      Villagers expressed that no stoppage of -
      unit result in stoppage of water    the water due to the construction of the
      to agricultural field               units and the approach roads to the wind
                                          units.
7     Would the project increase the      Villagers expressed that there is no -
      noise level in the neighborhood     disturbance nor high noise levels are
      areas and affect the villagers      present due to the operation of the wind
                                          units
8     Any occurrence of accidents.        Villagers expressed that no accidents so -
      Would the project increase          far have occurred. Also no disturbance or
      undesirable vehicular traffic       heavy traffic due to the establishment of
      during construction or during       wind units
      operation phase
9     Would the project increase dust During the construction nor the operation        -
      particles                       stage, no dust emissions are observed in
                                      the project sites nor the neighborhood
10    Tree/ plantations               Villagers suggested that planting of the    ENERCON             is
                                      medicinal plants could be carried out at    planting medicinal
                                      the down plains.                            plants at the project
                                                                                  site. They would also
                                                                                  be planting on the
                                                                                  slopes.
11    Social welfare activities           Villagers expressed that help should be ENERCON would
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                                   extended to villagers by providing do their best ot
                                   “lifts”/transportation, when they request provide help to the
                                   during cases like “deliveries” cases etc.     villagers    in    the
                                                                                 emergency cases.
12     Forest fire                 Villagers expressed fear about the ENERCON                      told
                                   occurrence of forest fire on the hills. (last about the efforts
                                   year there was heavy forest fire on the being made by them.
                                   hill tops). “Kalpatamallaiah” temple They               would     be
                                   which is worshipped by the villagers is constructing a three
                                   located on the hill.                          feet trench on the
                                   There should be additional watchmen to slopes and around
                                   be deployed by ENERCON for warning the project site. Also
                                   the villagers in the event of forest fire.    watchmen          and
                                                                                 security guards have
                                                                                 been instructed to be
                                                                                 vigilant and provide
                                                                                 warning in the cases
                                                                                 of occurrences of
                                                                                 forest fires
13     Does any disturbance to Avi Villagers expressed that due to the -
       fauna occur due to the wind increased usage of pesticide in the
       units?                      agricultural areas in the neighbourhood
                                   there is a decrease in the birds due to the
                                   lack of insects/worms etc.
                                   There is no bird’s migratory path in the
                                   areas

The representative of ENERCON announced that if the villagers or the participants stiil wish to bring to
notice of ENERCON any further issues/concerns/comments about the wind farms owned by ENERCON,
they may approach and convey to their respective representative Mr. Mahesh Arali located at the project
site. The response could be made during the next one month starting from the sate of 15/06/06

The meeting closed with giving thanks to all the participants and the chairman of the meeting.
                                                    PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03.1.

CDM – Executive Board                                                                                                                                                page 39


                                                                                Appendix 3
                                                                       Equity IRR of all sub projects
                                                     No. of              Date of                                           Interest rate   loan tenure     Equity IRR     Equity IRR
          Name of Customers            Type of Mc             MW                      Projet Cost   Debt %     Equity %
                                                      Mc               Comissioning                                             %             (Yrs)      (Without CDM)   (With CDM)

Enercon Wind Farms (Chitradurga) Ltd      0.80        11        8.80     May-06           440.0        70.0%       30.0%           8.5%          10.00          10.86%       13.35%
Panama Business Centre                    0.80         2        1.60      Mar-06           76.0        75.0%       25.0%           9.0%          12.00          11.56%       15.07%
Balasahab Ladkat                          0.80         2        1.60      Mar-06           76.0        75.0%       25.0%           9.0%          12.00          11.56%       15.07%
Elpro International                       0.80         1        0.80      Mar-06           38.0        70.0%       30.0%         10.8%            7.00           9.19%       11.33%
Gautam Ladkat                             0.80         1        0.80      Mar-06           38.0        75.0%       25.0%           9.0%          12.00          11.56%       15.07%
Panama Infrastructure                     0.80         2        1.60      Mar-06           76.0        75.0%       25.0%           9.0%          12.00          11.56%       15.07%
Sameer Ladkat                             0.80         1        0.80      Mar-06           38.0        75.0%       25.0%           9.0%          12.00          11.56%       15.07%
Steelfab Offshore                         0.80         1        0.80      Mar-06           38.5        65.0%       35.0%         12.5%            9.00           7.51%         9.69%
MK Agrotech Private Ltd                   0.80         2        1.60      Jun-06           76.0        70.0%       30.0%         10.5%            7.00          10.45%       12.56%
Srinivas Sirigeri                         0.80         1        0.80      Mar-06           36.3         0.0%      100.0%           0.0%              -           9.80%       11.08%
R.K.Marbles                               0.80         1        0.80      Mar-06           37.8         0.0%      100.0%           0.0%              -           9.13%       10.37%
Dempo Industries                          0.80         1        0.80      Mar-06           37.3         0.0%      100.0%           0.0%              -           9.34%       10.59%
Desai Brothers                            0.80         1        0.80      Mar-06           38.0         0.0%      100.0%           0.0%              -           9.05%       10.28%
Dewanchand Ramsaran                       0.80         1        0.80      Mar-06           37.0        70.0%       30.0%           8.5%           5.00          10.94%       12.94%
Abhilash Garments & Estates (P) Ltd       0.80         1        0.80      Dec-06           38.0         0.0%      100.0%           0.0%              -           9.31%       10.62%
Prasad Global Solutions                   0.80         2        1.60      Dec-06           76.6         0.0%      100.0%           0.0%              -           9.18%       10.48%
Gangadhar Narsingdas Agarwal              0.80         5        4.00      Dec-06          195.0        70.0%       30.0%         10.5%            8.00           8.99%       11.37%
Siddaganga Oil Extractions Ltd.           0.80         2        1.60      Dec-06           78.0        58.0%       42.0%         10.8%            5.00           9.00%       10.78%
Total                                                          30.40