3890 - ITC Green Boiler PDD - RFR - Final - Clean

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03
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
Annex 5: Project location
Annex 6: The summary of stakeholder meeting

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SECTION A. General description of project activity

A.1.
>>
Title:
Title of the project activity:
Fuel switch from fossil fuel to biomass residues for cogeneration in integrated pulp and
paper unit of ITC PSPD at Bhadrachalam
Version: 0 7
Date: 19.05.2011
A.2.
Description of the project activity:

>>
Purpose of the project activity
The project activity involves fuel switch measure through installation of a new biomass (residues) fired
boiler (project boiler-Green Boiler) for generation of steam which would eventually replace steam
generated from the existing/ new coal fired boilers CFBs. The ITC Paperboards and & Specialty Papers
Division (PSPD) is the project proponent and the project activity has been proposed at the existing
cogeneration unit of the integrated pulp and paper mill at Bhadrachalam, Andhra Pradesh. There are four
(4) numbers of operating CFBs (CFB 4, 5, 6, 7) and two (2) black liquor solid based boilers (SRB 3,4) in
the existing set up of the cogeneration unit. ITC has planned to install the proposed biomass based boiler
or Green Boiler in addition to the existing operating boilers at the cogeneration unit to meet the total heat
demand of the mill. In absence of the project activity the project proponent would have continued to run
the existing utility boilers and would have gone for another new coal fired boiler in place of the Green
Boiler considering the existing practice of using coal in the existing boilers and proximity of the
Singerani coal mine to the project site. The project activity would hence lead to reduction in carbon
dioxide (CO2) emissions by avoiding combustion of coal at the new coal fired boiler and marginally
mitigate emissions of methane gas (CH4) by avoiding natural decay of the biomass residues at the fields.
Salient features of the project activity
Since ITC has a policy to mitigate its business emissions through sustainable approaches such as using
renewable sources of energy generation and creating carbon sink, the management of ITC decided to use
the biomass residues such as barks, lops and tops, from the hardwood/ pulpwood plantation that has good
heat potential but are often put to fire (burns and slashes) to clear the field after the harvesting for next
plantation. ITC conducted studies to estimate the total availability of such biomass residues through third
party involvement and based on the positive feedback decided to us biomass residues in the proposed
steam boiler with claim of CDM benefits to mitigate the risk/ barriers associated with the project.
The project activity will primarily utilize two sources of biomass residues 1) Biomass Residues from
Plantation Wood available in the region. and 2) Agricultural Biomass Residues purchased from the
market. Apart from these two sources, a small fraction of chip dust, a biomass by-product of the wood
chipping process will be fired into the biomass boiler. A survey has been conducted by project proponent

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through Forest Research Center (Indian Council of Forestry Research and Education), Hyderabad,
Andhra Pradesh to: a) Know the types of biomass and understand the mechanism of supply of such biomass in the market;
b) Estimate whether the surplus availability of these biomass residues in the region of the project activity
is more than 25% larger than the quantity of biomass residues that are utilized.
The details of the two major biomass residues fired into the biomass boiler are as follows:
1) Biomass Residues from Plantation Wood: The parent pulp and paper mill uses hardwood (species
of Eucalyptus, Subabul, and Casurina) as raw material for pulp production. The hardwood is
mainly available from ITC Promoted farm and social forestry plantations and plantations raised
by local government and forest Development Corporation. As a general practise, from the
hardwood/ pulp wood that is purchased from the fields, only the woody biomass of the plant is
brought to the mill and the residues such as, wood barks, lops and tops, leaves and branches are
eventually burnt at the fields with no utilization of its heat energy. For the project activity these
leftovers in the fields will be bought from the farmers at a certain price for project use.
2) Agricultural Biomass Residues: The major farm level biomass items available in the region are
crop residues comprising primarily of paddy, cotton, chilly,, and residues from maize, red gram,
etc.. Presently, the farmers use part of the biomass for fuel purposes, hut making purpose but
majority of the residue is disposed off at site by burning.The surplus quantity of these residues
that are burnt off will be purchased by the proponent from the farmers for utilization of its heat
value in the project boiler.
It is envisaged that out of 70% of biomass input to the project boiler, the wood barks will constitute 60%
of the input and all other types of biomass residues will constitute 10% of the same.
Currently the project activity is at implementation stage and the project estimates to reduce an average of
74650 tons of CO2 equivalent per year.
Technology proposed for the project activity
The Green/new boiler in the project activity will be fired with both biomass residues and coal as a
supplementary fuel at a ratio of about 70:30 fuel mix ratio. As per the design specifications, the project
boiler is designed for 90 tons per hour (TPH) as MCR (Maximum Continuous Rating) and would
generate steam at a pressure of 65kg/cm2 (A) and temperature of 480oC. However, equipments shall be
checked for 100 TPH steam generation on continuous basis. As per the PSPD note for Capital
Expenditure (Capex) approval, the boiler is expected to generate about 86 TPH of steam at a load of more
than 90%. Considering 86 TPH of steam generation, the requirement of biomass firing at a 70:30 ratio is

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about 0.116 Million MT per annum of biomass residues (i.e. about 348 TPD)1. However, actual steam
generation as well as quantum of biomass fired would depend on the real time plant heat demand. The
steam would be fed into a common high pressure steam header which would then be transported to the
existing turbines to generate power and medium and low pressure steam would be extracted for process
use. As per the design specifications, the efficiency of the new boiler is expected to be around 80%. The
fuel bed of the boiler would of Atmospheric Fluidised Bed Combustion (AFBC) technology. The boiler
would be designed to have both the options of over bed and under bed firing of coal. Under bed firing
gives better performance whereas over bed firing gives flexibility to operate boiler with wet fuel. Thus the
biomass residues will be fired over the bed. In order to fire coal from under bed, coal will be crushed at
the site to get less than 6mm coal granules.
Biomass residues (as described above in this section) are not available in ready to be used form. Thus, a
separate biomass preparation plant would be established within the premises of the integrated pulp and
paper mill to chop the biomass to the requisite size. For direct feeding to the boiler, conveyor belts will be
installed connecting the boiler plant and biomass preparation unit. All other necessary auxiliaries required
for boiler operation will be set up as part of the project activity.
The green/ new boiler is of 90tph installed capacity which would be run in addition to the existing boilers
and hence there would be increase in the heat generation capacity by the biomass fired green boiler given
the existing set-up of heat generation. Table 1 and 2 below compare the three scenarios, the existing, the
baseline (i.e. scenario in absence of the project activity) and the proposed project activity, of heat and
power generation respectively in the cogeneration unit of ITC, to show that equivalent amount of heat
would have been generated in absence of the project activity but that would have come from adding a
coal fired boiler (of capacity similar to that of the green boiler) to the existing set of boilers whereas in the
project activity the additional heat will be generated from a biomass fired boiler:
Table 1: Steam Generation Capacity from Boilers
Boilers
Existing
Baseline
Project
Steam (TPH)
Steam (TPH)
Steam (TPH)
CFB 1
CFB 2
CFB 3
CFB 4
50
50
50
CFB 5
80
80
80
CFB 6
90
90
90
CFB 7
90
90
90
SRB 3
90
90
90
CER calculation excel sheet

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SRB 4
137
137
137
New CFB
90
Green Boiler
90
Total
537
627
627
Table2: Installed Capacity of Turbines:

Turbine
Rated Capacity (MW)
Available Capacity
Existing
Power (MW)
Baseline
Power (MW)
Project
Power (MW)
TG 1
TG 2
7.5
7.5
7.5
7.5
TG 3
21
21
21
21
TG 4
18.5
18.5
18.5
18.5
TG 5
22.1
22.1
22.1
22.1
TG 6
14.8
14.8
14.8
14.8
88.9
83.9
83.9
83.9
Not in Service
It is imperative to run all the boilers i.e. CFB (4-7), SRB 3, 4 and the green boiler in the project activity at
an optimum combined load of about 80% to meet the plant heat demand which is at about 499 TPH as per
the current scenario, the percentage load on green boiler being at about 86%. This substantiates the fact
that the green boiler will continue to run in addition to the existing boilers in order to meet the total heat
demand of ITC PSPD Bhadrachalam unit at an optimum combined boiler load. However, individual
boiler load will vary. This combination of boiler loading would provide the PP the buffer to vary
individual boiler loading in case of forced /regular maintenance shutdown of one of the boilers is
necessary, without overloading any of the boilers. In absence of the green boiler, the PP would have
maintained the same boiler combination by adding 90 TPH capacity to the existing boiler combination to
meet its heat demand and hence a coal fired boiler of the same capacity would have run in addition the
existing boilers. The table below shows how percentage loading of running boilers would vary with and
without 90 TPH green boiler in project or 90 TPH CFB in baseline.

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Table: 03 Boiler loading with and without addition of 90 TPH green boiler (in project) OR 90 TPH coal
fired boiler in baseline
Boilers
Capacity
Steam (TPH)
CFB 1
Heat
generation at
present (TPH)
499
CFB 2
499
CFB 3
499
CFB 4
50
499
CFB 5
80
499
CFB 6
90
499
CFB 4
CFB 5
CFB 6
CFB 7
CFB 7
90
499
SRB 3
90
499
SRB 4
137
499
New Green
Boiler (GB) /
New CFB
499
Total
Capacity
(without GB
or CFB)
Loading %
537
499
487
457
447
447
92%
102%
109%
112%
112%
New
CFB/Green
Boiler
90
Total
Capacity(with
GB or CFB)
627
499
577
547
537
537
80%
86%
91%
93%
93%
Loading %
From the above table it is evident that to have an optimum boiler load to suffice the plant head demand
over the year considering all possible shut downs, it is necessary to go for boiler capacity addition of 90
TPH, be it green boiler in the project activity or coal fired boiler in the baseline.
Again, from the mill performance report of 2008-2009 i.e. in the pre-project scenario, the heat demand as
depicted by the steam generation from the 62 ata boilers (i.e. CFB 4 to CFB 7, SRB 3 and SRB 4) is at
383.09 TPH at 71.86% boiler load i.e. equivalent to 426.48 TPH at 80% boiler load. So from pre-project
to project there is a direct increase of about 72.5 TPH (i.e. from 426.48 TPH to 499 TPH) of heat demand
at the plant. Hence from heat demand increase perspective, it was necessary to go for a 90 TPH CFB in
baseline or a 90 TPH green boiler in project to run at an optimum loading of 80%.

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The project activity contributes to sustainable development in terms of environmental, socio-economic

and technological well being in line with the host government guidelines in the following manner:
Environmental well being:
The project would lead to reduction in combustion of coal leading to reduction in CO2 emissions and
other associated emissions such as SPM, SOx, NOx, due to AFBC design of boiler etc.
From usage of biomass residues the project would avoid methane emissions at the plantation fields
that would have occurred from natural decay of biomass residues in absence of the project activity.
Technological well being:
The project brings in the concept of bottom hopper design in AFBC technology in pulp and paper
industry enabling combustion of all grades of coal with facility of both over bed and under bed firing.
Biomass is fired over bed considering the size and surface moisture constraints thereby ensuring
flexibility in firing of fuel and sustaining energy needs from all grades of coal and biomass.
Use of this technology will create awareness in the paper and pulp industry on the benefits of
plantation residues which are often left at the fields due to high moisture content.
Socio-economic well being:
ITC would set up a biomass preparation plant which will be operated by ITC or a third party leading
to generation of additional source of work opportunities and income in the region.
The project initiative is likely to bring in additional source of income for the farmers from the sale of
biomass residues which currently are having no economic value.
Economical well being:
This project leads to the economic well being by providing the access to green technology and by
committing to additional investment in green technology. This investment is consistent with the needs of
the people who are also the local stake holders like farmers and suppliers of bio mass will benefit from
this green boiler project activity. The needs of people with respect to environment would also benefit
from reduced emission from the project activity.
In addition to this, ITC - PSPD confirms that the Company will contribute up to 2% of the CDM revenue
from the CDM project in activities of sustainable development including society / community
development carried out by ITC time to time.
A.3.
>>
Project participants:
Name of Party involved (*)

((host) indicates a host Party)
Government. of India
Private and/or public

entity(ies)
project participants (*) (as
applicable)
ITC - Paperboards and Specialty
Papers Division (PSPD)
Kindly indicate if the Party

involved wishes to be
considered as project
participant (Yes/No)
No

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A.4.
Technical description of the project activity:

A.4.1. Location of the project activity:
>>
A.4.1.1.
Host Party(ies):
>>
India
A.4.1.2.
Region/State/Province etc.:
>>
Khammam District, Andhra Pradesh
A.4.1.3.
City/Town/Community etc.:
>>
Sarapaka village near Bhadrachalam town
A.4.1.4.
Details of physical location, including information allowing the
unique identification of this project activity (maximum one page):
>>
The project activity is part of existing cogeneration unit of the integrated pulp and paper mill of ITC
PSPD located at Sarapaka near Bhadrachalam town (around 17o4119N latitude and 80o5205E
longitude) in Andhra Pradesh. The site is at a distance of 300 km from Hyderabad. The nearest railway
station is Bhadrachalam Road at a distance of 45 Km. The map of the site and its vicinity has been
presented in Annex 5 of this PDD for ready reference.
A.4.2. Category (ies) of project activity:
>>
The project activity is applicable to Category 1 Energy industries (renewable - / non-renewable
sources) as per the CDM sectoral scope version version 15 Jul 10|10:44 and as per approved
methodology AM0036 Fuel switch from fossil fuels to biomass residues in heat generation equipment
Version 03; Sectoral Scope: 01 & 04; EB 51 (Valid from 18 Dec 09 onwards).
A.4.3. Technology to be employed by the project activity:
>>
The project would use optimal design for energy generation through biomass residues. M/s Avant Garde,
well known consultants in the field of plant and machinery design for development of power from nonconventional and renewable sources, has been hired to determine the plant design according to the
biomass residues available to the unit. The exhaust of the boiler would be passed through economiser, air
pre-heater, ESP and stack. There is no transfer of technology involved under the project activity.

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A.4.4. Estimated amount of emission reductions over the chosen crediting period:
>>
Years
1st year*
2nd year
3rd year
4th year
5th year
6th year
7th year
8th year
9th year
10th year
Total estimated reductions (tonnes of
CO2 e)
Total number of crediting years
Annual average over the crediting
period of estimated reductions
(tonnes of CO2 e)
Annual estimation of emission reductions in

tonnes of CO2 e
74650
74650
74650
74650
74650
74650
74650
74650
74650
74650
746500
10years
74650
*The start date of the crediting period is tentatively 01/07/2011

A.4.5. Public funding of the project activity:
>>
No ODA fund is flowing to 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:
>>
Approved Baseline & Monitoring Methodology AM0036 Fuel switch from fossil fuels to biomass
residues in heat generation equipment Version 03; Sectoral Scope: 01 and 04; EB 51, valid since 18th
December 2009
Reference: http://cdm.unfccc.int/methodologies/PAmethodologies/approved.html
B.2.
Justification of the choice of the methodology and why it is applicable to the project
activity:
>>
As per the conditions stated in the methodology, it is applicable to the project activities that switch from
use of fossil fuels to biomass residues, in heat generation equipments(Heat generation equipment as
defined in the methodology is as a facility that generates thermal energy by combustion of fuels
and supplies heat to thermal applications or processes. This includes, for example, a boiler that supplies
steam or hot water, a heater that supplies hot oil or thermic fluid, or a furnace that supplies hot gas or
combustion gases. When several heat generation equipments are included in one project activity, each

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heat generation equipment is referred to as unit.)

Accordingly a list of applicable project scenarios with description has been suggested in the
methodology.
As the project involves installation of a new boiler in addition to the existing boilers for utilization of
biomass residues as fuel the Scenario no. 3, i.e. Installation of new heat generation equipment. is
applicable to the proposed project activity.
Scenario no. 1 Retrofit of existing heat generation equipment is not applicable to the project
activity as the project activity does not include any retrofitting measures in the existing boilers.
Also the project does not lead to replacement of the existing boilers thus Scenario no. 2 is not
applicable to the project.
Similarly, Scenario no. 4 which includes installation of new heat generation equipment/boilers and
retrofit and/or replacement of the existing boiler is also not applicable to the project activity.
As described under Scenario no. 3 - Installation of new boilers. The project activity is to increase of the
heat generation capacity by installation of new heat generation equipment/boilers(s) that fire(s) mainly or
solely biomass residues(some fossil fuels may be co-fired). The use of biomass residues or an increase in
the use of biomass residues beyond historical levels would not be technically possible without a retrofit or
replacement of the existing heat generation equipment/ boiler(s) or the installation of a new heat
generation equipment/ boiler. The procedure to determine the most plausible baseline scenario results in
that the same fossil fuel type(s), as used in the existing heat generation equipment/boiler(s), would be
used in the new heat generation equipment/boiler(s) in the absence of the CDM project activity. The use
of biomass residues in the new heat generation equipment / boiler(s) involves a significant additional
capital investment in either a new dedicated biomasssupply chain established for the purpose of the
project (e.g. collecting and cleaning contaminated new sources of biomass residues that could otherwise
not be used for energy purposes) or in the boiler (i.e. enabling the use of biomass residues instead of
fossil fuels).
In line with the above-mentioned narration of the project activity, the new biomass based Green boiler in
the proposed project activity would run in addition to the existing boilers (4 coal fired and 2 black liquor
solid fired boilers) in the cogeneration unit and would increase the heat generation capacity through use
of biomass residues. Some amount of fossil fuel, i.e. coal would also be co-fired with the biomass
residues; however, the quantity of fossil fuel fired will not exceed 50% of the total fuel fired on an energy
basis. In absence of the project activity the PP would have installed a new boiler and the same fossil fuel
type as in the existing practice i.e. coal would have been fired in the new boiler. The installation of the
Green boiler would enable ITC to use biomass residues at the site which could not have been fired in the
existing CFBs due to design and layout constrains. It should be noted that SRBs (or Soda Recovery
Boilers) are exclusively to fire black liquor solids to extract the chemical and consequentially generate
steam and are installed as a process requirement. The project activity would lead to usage of biomass
residues such as bark of the trees, lops and tops, chip dust and other agricultural biomass based on
availability which has never been used before at the project site. In order to use the biomass residues at
the project site a supply chain has to be established to carry the biomass residue from the agricultural
fields as well as from the plantation site to the project site. Moreover, to fire the biomass residues into the
biomass boiler, a biomass preparation and handling process is imperative. The preparation and handling
process requires an investment to the tune of INR 40 Million, and another 15 Million as civil cost over
and above the project cost, as mentioned in the TEFR.

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Since in the project activity a new biomass residue fired boiler would be installed hence we would
hereafter use the term boiler as the heat generation equipment
The project also meets the other conditions laid down in the methodology and discussion of which has
been given below: Condition 1 - The project activity may be based on the operation of (a) heat generation boiler(s):
In an agro-industrial plant generating the biomass residues, which is used in the activity; or
In an independent plant where the biomass residues are procured from the nearby area or a market.
The project activity does include generation of heat and the Green boiler would be based within a pulp
and paper industry. The biomass residues would be procured from two sources: 1) Commercial plantation
of pulpwood and 2) Agricultural Residues. Other than these two types of residues chip dust is also fired in
the project boiler which is a biomass by-product of the process of chipping of wood, a raw material for
the pulp making process.
Condition 2 - The heat generated in the boiler(s) is
Not used for power generation; or
If power is generated with heat from the boilers, it is not increased as a result of the project activity,
i.e.
a) site, the power generation capacity installed remains unchanged due to the implementation of the
project activity and this power generation capacity is maintained at the pre-project level throughout
the crediting period; and
b) the annual power generation during the crediting period is not more than 10% larger than the
highest annual power generation in the most recent three years prior to the implementation of the
project activity
The installation of the biomass based green boiler in the project activity would not increase the installed
power generation capacity within the project site. This is demonstrated by the Table 1 which illustrates
both pre and post project scenario of the installed power generation capacity of the turbines of the
cogeneration unit of ITC. Further, project activity does not involve any replacement/ retrofit of the
existing turbines to enhance power generation efficiency and or installation of new turbine to augment
with additional capacity. (Please Refer to Table 1)
In the most recent past, i.e. in the year 07-08, and 08-09, 09-10 (Mill PR data: March 07 to Feb 10) the
highest power generation has been 500559.5 MWh. Therefore additional 10% generation would stand as
550615.5 MWh. In the given setting of the cogeneration unit, i.e. after the project boiler/Green boiler has
been commissioned, (refer to Table 1), and with full capacity utilization of the steam generating boilers,
550615. 5 MWh generation cannot be reached due to the fact that the present combination of extraction
and condensing turbines has to allow for extraction of medium and low pressure process steam and the
entire quantum of high pressure steam, even if available, cannot be condensed to obtain power and hence

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there is an optimal limit for power generation. Therefore, it can be safely considered that there would not
be any increase in power generation due to installation of project boiler/ Green boiler.
However, it should be noted that since the cogeneration unit serves the pulp and paper unit of ITC PSPD
Bhadrachalam, thus with expansion in the pulp and paper unit, the cogeneration unit is likely to expand.
But as it has been mentioned above, even with the inclusion of the project boiler and with maximum
utilization of all the steam boilers (all CFBs and SRBs, project boiler),550615.5MWh generation (i.e.
500559.5 MWh + 10%) cannot be reached, therefore due to project activity there would not be any
change in the power generation capacity of the unit.
Condition 3 - The use of biomass residues or increasing the use of biomass residues beyond historical
levels is technically not possible at the project site without a significant capital investment in
Either the retrofit or replacements of existing boilers or the installation of new boilers;
Or in a new dedicated biomass supply chain established for the purpose of the project (e.g. collecting
and cleaning contaminated new sources of biomass residues that could otherwise not be used for
energy purposes.
A new biomass supply chain needs to be set up to procure biomass residues from farmers and transport
the residues to the project site and hence there is substantial investment for the execution of the project
activity. Again the biomass residues available from the plantation sites cannot be fired directly into the
boiler and need further preparation and handling. Thus, project proponent would have to spend substantial
amount of capital (refer to the excel sheet on investment comparison calculation for detail) for
establishment of separate biomass preparation and handling plant which is proposed to be situated
adjacent to the project site. In addition to this there is substantial investment in procuring the biomass
residue fired green boiler.
Condition 4 - Existing boilers at the project site have used no biomass or have used only biomass
residues (but no other type of biomass) for heat generation during the most recent three years prior to the
implementation of the project activity
The biomass residues that are being fired into the project boiler have never been used in the existing
boilers at the cogeneration site during the most recent three years prior to the implementation of the
project activity. However, the SRBs fire black liquor solids mainly for chemical recovery as a process
requirement and steam generated from the boilers is a supplementary activity. Please refer to the Mill PR
data for the most recent three years that gives boiler wise fuel consumption details.
Condition 5 - No biomass types other than biomass residues, as defined in the methodology, are used in
the boiler(s) during the crediting period (some fossil fuels may be co-fired);
The project would use biomass residues available from the activities mentioned below:

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1) The tree barks, lops and tops are by product of industrial plantation activity
2) Paddy, cotton, chilly, maize, redgram are other agricultural crop residues available from the
agricultural fields in the region.
3) chip dusts a by-product coming from wood chipping from ITCs own chipping house of the pulp
mill
No other biomass residues other than what has been mentioned above would be used during the entire
crediting period of the project activity. Coal will be co-fired as a supplementary fuel at a ratio of less
than 50% in terms of fuel energy.
Condition 6 - For projects that use biomass residues from a production process (e.g. production of sugar
or wood panel boards), the implementation of the project shall not result in an increase of the processing
capacity of raw input (e.g. sugar, rice, logs, etc.) or in other substantial changes (e.g. product change) in
this process;
Apart from chip dust, which is one of type of biomass residues that is proposed to be fired in the project
boiler/ Green boiler, all other types are purchased from the market. Chip dust is sourced from in-house as
waste of wood chipping process. The chip dusts fired in the project boiler forms a minor fraction of the
total biomass residues fired into the boiler. Therefore, the unit which produces 3, 50,000 tons of paper and
paperboards every year, the chip dust already available is more than sufficient for the project boiler and it
is less likely that the PP would enhance its capacity to avail of chip dust required in the project activity.
Condition 7 - The biomass residues used by the project facility should not be stored for more than one
year;
There is no requirement of storing biomass residues for more than one year as there would be continuous
supply of fuel.
Condition 8 - No significant energy quantities, except from transportation or mechanical treatment of the
biomass residues, are required to prepare the biomass residues for fuel combustion, i.e. projects that
process the biomass residues prior to combustion (e.g. esterification of waste oils)
The biomass residues would be transported from the plantation sites & agricultural fields and then
mechanically treated (chipping & conveying process) before firing at the boiler. Other than this no other
processing of biomass requiring significant energy consumption is envisaged in the project activity.
Condition 9 - The biomass residues are directly generated at the project site or transported to the project
site by Trucks

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Biomass residue such as chip dust would be generated at site from chipping of woody biomass used for
pulp production. Other than this, tree barks, lops and tops will be transported from the plantation site and
other agricultural biomass residues would be transported from the agricultural site to the project site by
trucks .
Condition 10 - In case of project activities that involve the replacement or retrofit of existing boiler(s), all
boiler(s) existing at the project site prior to the implementation of the project activity should be able to
operate until the end of the crediting period without any retrofitting or replacement, i.e. the remaining
technical lifetime of each existing boiler should at the start of the crediting period be larger than the
duration of the crediting period (7 or 10 years as applicable).
The project activity does not involve replacement or retrofit of the existing boilers.
B.3.
Description of the sources and gases included in the project boundary:
>>
As per the approved methodology:
For the purpose of determining GHG emissions of the project activity, project participants shall include
the following emissions sources:
CO2 emissions from on-site fossil fuel and electricity consumption that is attributable to the
project activity
CO2 emissions from off-site transportation of biomass residues that are combusted in the boiler(s)
to the project site
For the purpose of determining the baseline, project participants shall include the following emission
Sources:
CO2 emissions from fossil fuel fired for heat generation in boilers that are displaced by heat
generation with biomass residues
AND the spatial extent of the project boundary encompasses:
The boiler(s) and related equipment at the project site;
The means for transportation of biomass residues to the project site (e.g. vehicles);
The site where the biomass residues would have been left for decay under anaerobic conditions
(This is applicable only to cases where the biomass residues would in the absence of the project
activity be dumped under anaerobic conditions)
As per the methodology the emissions sources included in or excluded from the project boundary
are:
Source
Fossil fuel
combustion in
Gas
CO2
CH4
Justification/Explanation
Included CO2 emission from the existing CFBs
Excluded Excluded for simplification. This is conservative.

CDM Executive Board
page 15
Baseline
boilers for heat

generation
Uncontrolled
burning or decay of
surplus biomass
residue
N2O
CO2
Excluded It is assumed that CO2 emission fro surplus

biomass residues do not lead to changes of
carbon pools in the LULUCF sector.
Included Since the most plausible baseline scenario in the
project case is B3 hence the project participants
decided to include this source of emissions.
Note also that emissions from natural decay of
biomass are not included in GHG inventories as
anthropogenic sources.
Included CO2 emissions from the on-site fossil fuel and
electricity consumption that is attributable to the
project activity Electricity consumption for
preparation of biomass using chippers and
shredders has been considered.
Excluded Excluded for simplification. The emission source
is assumed to be very small.
Included Off site transportation of biomass residues from
the plantation site and agricultural fields.
Excluded It is assumed that CO2 emission from surplus
biomass does not lead to changes in carbon pools
in the LULUCF sector.
Included Since the PP has included CH4 emissions from
uncontrolled burning of the biomass
residues in the baseline scenario this emission
has been considered for conservative estimation.
Excluded Excluded for simplification. This emission source
is assumed to be small.
Excluded It is assumed that CO2 emission from surplus
biomass does not lead to changes in carbon pools
in the LULUCF sector.
Excluded Excluded for simplification. Since the biomass
residues are stored for not longer than one year.
The emission sources are assumed to be small.
Excluded Excluded for simplification. This emission source
CH4
N2O
On-site fossil fuel

and electricity
consumption due to
project
activity(stationary or
mobile
CO2
CH4
N2O
Project
Activity
Off-site
transportation of
biomass residues.
CO2
CH4
N2O
Combustion of
biomass residues for
electricity and/or
heat generation
CO2
CH4
N2O
Storage of biomass
residue
CO2
CH4
N2O
According to the approved methodology the spatial extent of the project boundary in case of the
proposed project activity encompasses:

CDM Executive Board
page 16
The project boiler to correctly estimate on-site biomass fired in the project activity and the CO2
emissions displaced due to the project activity
The means for transportation of biomass residues to the project site (e.g. trucks) and the site
where the biomass residues are available (Plantation sites, agricultural fields and chipper house)
to correctly estimate the CO2 emissions from off-site transportation of biomass residues
Avoided CH4 emission

from uncontrolled burning
of biomass residue
Baseline and project activity
CO2 and CH4 emissions from
coal and biomass
combustion
PLANTATION
SITES
CO2 EMISSION FROM OFF SITE

TRANSPORTATION OF
BIOMASS
THE GREEN BOILER
AGRICULTURAL
SITES
ON SITE GENERATION OF CHIP
DUST
Heat from Boiler

Biomass
CH4 emissions
B.4.
Description of how the baseline scenario is identified and description of the identified
baseline scenario:
>>
According to the approved methodology the procedure for the selection of the most plausible baseline
scenario includes:

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page 17
Step 1 - Identification of alternative scenarios to the proposed CDM project activity that are consistent
with current laws and regulations
In applying Step 1 of the tool, realistic and credible alternatives consistent with current laws and
regulations have been separately determined regarding:
How heat would be generated in the absence of the CDM project activity;
What would happen to the biomass residues in the absence of the project activity
For heat generation the realistic and credible alternatives may include:
H1 - The proposed project activity not undertaken as a CDM project activity (heat generation with
biomass residues)
This alternative is in compliance with all applicable legal and regulatory requirements. However, it faces
barriers to implement. (Please refer to section B.5 below for detailed analysis on these barriers). Hence
this option is not a part of the baseline scenario.
H2 - Continued operation of the existing boiler(s) using the same fuel mix or less biomass residues as
in the past
As mentioned in Table 1, ITC has 4 numbers of CFBs and 2 SRBs operating as per the existing set up of
the cogeneration unit. ITC in absence of the project activity would have continued to operate the existing
set up and would have installed another coal fired boiler to cater to the heat demand of the ITC PSPD
Bhadrachalam unit. Hence this option is not an appropriate baseline alternative to the project activity.
H3- Continued operation of the existing boiler(s) using a different fuel (mix)
Considering the project location, there is no other fuel or fuel mix which is more accessible than coal to
be used in the existing boilers in absence of the project activity. Again, the design of the existing boilers
allows only coal to be used as the fuel. Considering these facts this alternative is not a part of the baseline
scenario.
H4- Improvement of the performance of the existing boiler(s)
The existing boilers in the ITC cogeneration unit are high pressure boilers of reasonably high average
efficiency of about 77% and have sufficient residual life. Hence improvement of performance of the
existing boiler is not an option to the proposed project activity.
H5- Continued operation of the existing boiler(s) using the same fuel mix or less biomass residues as
in the past AND installation of (a) new boiler(s) that is/are fired with same fuel type(s) and the same
fuel mix (or a lower share of biomass) as the existing boiler(s)
This project activity is aimed solely at the reduction of coal consumption for meeting heat demand of ITC
PSPD Bhadrachalam unit. To meet the total heat demand of the paper mill, the PP in absence of the
project activity, would have run the existing CFB boilers (4-7) and SRBs (3, 4) and in addition to that one
new coal fired boiler would have been installed. Coal would have been the natural choice because of the
following reasons:

CDM Executive Board
page 18
a) Coal is used in all the existing boilers other than the chemical recovery boilers,
b) The availability of coal is high due to the proximity of the coal mines (Singerani Coal Mines)
c) The PP had decided to go for a coal fired boiler (of similar capacity compared to that of the
project Green Boiler) in place of the Green Boiler and obtained the consent for establishment for
the same.
Considering these facts this option is a part of the baseline scenario.
H6- Replacement of the existing boiler(s) with new boiler(s)
All the existing CFBs and SRBs that are operating in the cogeneration unit are efficient boilers with
sufficient residual life and hence replacement of the existing boilers in absence of the project activity is
not an alternative to the project activity. Considering these facts this option is not a part of the baseline
scenario.
For the use of biomass residues, the realistic and credible alternative(s) may include:
B1- The biomass residues are dumped or left to decay under mainly aerobic conditions
This alternative is in line with all regulatory requirements of the country. However, as a general practice
the biomass residues obtained from the plantation sites and agricultural fields are eventually burnt by the
farmers without utilization of its heat energy. As a common practice, the chip dusts are also dumped in
the yard and burnt periodically by the proponent. Hence this option does not form a part of the baseline
scenario.
B2- The biomass residues are dumped or left to decay under clearly anaerobic conditions
In absence of the biomass residues obtained from the agricultural crops and wood plantation, they are
burnt in the fields by the farmers and hence this option is not a part of the baseline scenario.
B3- The biomass residues are burnt in an uncontrolled manner without utilizing them for energy
purposes
This alternative is in line with all regulatory requirements of the country. As mentioned in the biomass
survey report by Forest Research Center (Indian Council of Forestry Research and Education)
Hyderabad,, the biomass residues obtained from the plantation sites and agricultural fields are burnt in an
uncontrolled manner in the fields by the farmers without utilizing its heat value. The chip dusts, the
biomass by product fired into the green boiler are also burnt periodically by the proponent without
utilizing its heat value. Hence this is the most likely baseline scenario of the project activity.
B4- The biomass residues are sold to other consumers in the market and the predominant use of the
biomass residues in the region/country is for energy purposes (heat and/or power generation)
As mentioned earlier the biomass residues obtained from the plantation sites and agricultural fields are
burnt in an uncontrolled manner in the fields by the farmers without utilizing its heat value and there is

CDM Executive Board
page 19
presently no taker of these biomass residues. Therefore, this option is not considered as a baseline option.
.
B5- The biomass residues are used as feedstock in a process (e.g. in the pulp and paper industry):
Feedstock to the pulp and paper manufacturing process is the de-barked wood. The biomass residues to be
used in the project boiler, as mentioned in section A2 above are mainly wood barks, lops and tops
(remains in the field after the de-barked wood is taken for pulp and paper manufacturing) and a small
percentage of agricultural residues such as rice husk, cotton and chilly stalks etc. These cannot be used as
feedstock in the pulp and paper manufacturing process.
B6- The biomass residues are used as fertilizer
The alternative is consistent with the current legal and regulatory requirement. However, biomass
residues need extensive processing such as anaerobic digestion in controlled environment, and such
infrastructure is absent in the region. Again, as mentioned earlier the biomass residues fired into the green
boiler are eventually burnt without utilizing its heat value. Hence this option is not a part of the baseline
scenario.
B7 The proposed project activity not undertaken as a CDM project activity (use of the biomass
residues for heat generation)
This alternative is in compliance with all applicable legal and regulatory requirements. However, it faces
barriers to implement. (Please refer to section B.5 below for detailed analysis on these barriers). Hence
this option is not a part of the baseline scenario.
B8 Any other use of the biomass residues
There is no other use of the biomass residues that are fired into the green boiler other than those which
have been identified in the previous points, thus this option is not considered as a baseline scenario.
Conclusion
As discussed above the list of plausible scenario is summarized as: 1. For the purpose of heat generation, in absence of the project activity, the existing CFB boilers (47) and SRBs (3, 4) would run and in addition to that one new coal fired boiler would have been
installed Option H5.
2. For biomass residues obtained from the plantation sites and agricultural fields, the most plausible
baseline options are Option B3- The biomass residues are burnt in an uncontrolled manner
without utilizing them for energy purposes.
Hence the baseline for heat generation is the continued operation of existing coal fired boilers. The
quantity of coal used and the energy generated can be measured and accounted for using standard
engineering best practices. No other fossil fuel is used as these are dedicated boilers monitored through a
dedicated DCS system. Therefore it is possible to accurately measure the quantity of coal avoided both
from a measurement standpoint as well as can be corroborated through a rigorous energy balance. With
the cross check and built in redundancy in the system, the proponent does not envisage any risk or
uncertainty to the baseline.
Similarly the abundance of biomass in the region and its current state of non-utilization and uncontrolled
burning by the farmers is documented in the biomass survey report by Forest Research Center (Indian
Council of Forestry Research and Education), Hyderabad.

CDM Executive Board
page 20
Step 2 - Barrier analysis to eliminate alternatives to the project activity that face prohibitive barriers
Barrier analysis has been carried out for the above mentioned baseline scenarios. As all the scenarios
summarized above are currently practiced and there is no legal requirement by the host country to
discontinue such practices, none of the option has been eliminated from the list summarized above.
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):
>>
Project participants have identified the most plausible baseline scenario and demonstrated additionality as
per
Step 3 of the latest version of the Tool for the demonstration and assessment of additionality version
5.2
Step 1: Identification of alternatives to the project activity consistent with current laws and regulations
Sub-step 1a: Define alternatives to the project activity:
Refer to section B.4
As discussed above the list of plausible scenario is summarized as: 1. In absence of the project activity, the PP would have run the existing CFB boilers (4-7) and SRBs (3,
4) and in addition to that one new coal fired boiler would have been installed. Option H5.
2.
For biomass residues obtained from the plantation sites and agricultural fields, the most plausible
baseline options are Option B3- The biomass residues are burnt in an uncontrolled manner without
utilizing them for energy purposes
Sub-step 1b. Consistency with mandatory applicable laws and regulations:
As mentioned in section B.4 the alternative scenarios are consistent with the mandatory applicable laws
and regulations
Step 2: Barrier analysis
Sub-step 2a: Identify barriers that would prevent the implementation of the proposed CDM project
activity:
and
Sub-step 2b: Show that the identified barriers would not prevent the implementation of at least one of
the alternatives (except the proposed project activity):
Since there is only one option for heat generation and biomass reuse, barrier analysis shows nothing that
prohibits the project activity to continue with the current practices and there is no legal requirement by the
host country to discontinue such practices. Therefore, in order to prove additionality of the project
activity, investment analysis (given in the next step) has been conducted.

CDM Executive Board
page 21
Step 3: Investment analysis

As stated above the most plausible baseline scenario of the project activity is continuation of the existing
utility boilers and installation of a new coal fired boiler of capacity similar to that of the green boiler.
Guidance on investment analysis states If the proposed baseline scenario leaves the project participant
no other choice than to make an investment to supply the same (or substitute) products or services, a
benchmark analysis is not appropriate and an investment comparison analysis shall be used. In order to
meet the total heat demand of the mill investment on a new boiler is imperative in the project case as well
as in the baseline scenario. Hence an investment comparison analysis considering the unit cost of the
boilers in the two scenarios has been carried out by the project proponent. The unit cost comprises of
fixed and variable cost heads of the green boiler and a coal fired boilers have been considered in the
project case and the baseline case respectively. The different cost heads are:
Variable Cost
- Fuel cost The project activity being a coal and biomass co-fired boiler and the baseline being a
100% coal fired boiler, the only variable with respect to the project and baseline scenario cost is
the cost of fuels (i.e. biomass residues and coal) fired into the boiler. An annual increase in the
variable cost at 6% has been considered as per ITC PSPD plan 2008-2009.
Fixed Costs
- Capital cost (Equated annually over 20 years: This depicts the PPs payment towards the capital
cost of INR 860 million in the project activity and INR 805 Million in the baseline at an equal
annual amount over a period of 20 years as a fixed cost instead of a onetime investment such that
the Net Present Value (NPV) of the equated cost is equal to the one time capital cost. For
example, in the project case an equal annual amount of INR 122.42 million would be paid
towards INR 860 million over the 20 years period chosen with a capital recovery factor of 14%
calculated based upon the discount rate of 13%, ITCs internal hurdle rate based on their
Weighted Average Cost of Capital (WACC). Similar approach has been followed in the baseline
case also. Necessary corrections have been in the revised PDD and levelized cost calculation
excel sheet.
- O&M is considered as a fixed cash flow at 2.5% of the investment cost. The rate of O&M is
substantiated through ITC PSPD plan 2008-2009.
- Depreciation- An annual depreciation at 5.28% has been considered as per Indias Companys
Act till the total book value gets depreciated till 95%, considering 5% as the residual value as per
Indian Companys act2. This is for the purpose of calculating the income tax benefit due to
enhanced depreciation permitted in the initial years by Indian taxation rules while taking into
account the book depreciation. Since the book depreciation is a notional cost item this is added
back after calculation of income tax. Also a residual value at 5% has been considered as a benefit
at the end of 20 years.
- Income Tax (IT) benefit due to enhanced IT depreciation rate (80% for boilers as per Central
Board of Direct Taxes Rules over and above the straight line depreciation, at 33.99% of corporate
tax rate of India)
- Interest on working capital (One month inventory @ 12.25%)- One month inventory of boiler
fuels has been considered as an annual cash flow at 12.25% of the total annual variable cost in the
project as well as in the baseline. The working capital interest rate of 12.25% is based on market
2
Refer point 19 of http://220.227.161.86/eac/eacfinal/vol25/13.htm

CDM Executive Board
page 22
prevailing prime lending rates as available in Reserve Bank of India website during decision
date3.
A Capital Recovery Factor (CRF) converts a present value into a stream of equal annual
payments over a specified time which is calculated as:
CRF = i (1+i) ^n
/ ((1+i) ^n- 1)
equation A
Where,
i - the interest rate considered at 13% as per ITCs internal hurdle rate substantiated through
Corporate Governance Policy of ITC Paperboards and Specialty Papers Division (PSPD)
n = number of year considered at 20
From the above inputs the levelized costs for the project activity and baseline has been calculated
as:
equation B
Levelized cost in INR/TJ = (TCn * dfn) / dfn
Where,
TCn = Total cost of the project/baseline activity in INR million/TJ of heat output from the boilers
in the year n i.e. the summation of fixed cost and variable cost in INR million/TJ of heat output
from the boilers of the project/baseline activity in the year n
dfn = The discount factor considered in the year n which is calculated as:
dfn = 1/(1+i)^n where,
i = the discount rate at 13%
n = number of year
Levelized cost represents the unit cost calculated based on the Net Present Value (NPV) of the
annual cash flow in terms of fixed and variable costs in INR million over 20 years and the NPV
of the annual energy generation in TJ over the 20 year period chosen. Hence equation B can also
be represented as equation C:
Levelized cost in INR/TJ = NPV (TCn, 13%)/ NPV (Energy in TJ in the year n, 13%) equation
C
Levelized cost has been calculated using both the equations for the purpose of conceptual clarity and
cross checking and the results with both equations are same. The results are as follows:
Parameters
Unit
Total levelized
Cost per TJ of
energy
generated
INRMillion/TJ
http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/T1101_STST1118.pdf
Biomass
Cogeneration
(project activity)
0.164
100% coal fired

boiler (baseline)
0.139

CDM Executive Board
page 23
Considering the total project cost in the project activity, there is a shortfall of revenue generation to the
tune of INR 49.69 Million per year on total energy generation compared to the costs involved with the
baseline 100% coal fired boiler.
The following are the basis for calculation of the unit costs for the baseline and project scenario:
SL No.
1
Parameters
Project Cost- INR 860 Million
Baseline Cost- INR 805 Million
Source
PSPD note to CMC for Capex Approval
dated 17 April 2008
To compare the boiler cost of a 100% CFB
with that of the green boiler, it is observed
from the justification note of CFB 7
purchased in 2006 that the cost was INR 260
Million compared to boiler cost of green
boiler at INR 410 Million which is INR 150
Million more than that of 100% CFB.
Also in the CMC approval for the project
activity it is mentioned that the budgeted
amount for the project activity as per Capex
plan 2008-09 was at INR 650 Million which
was meant for the 100% CFB that had been
planned before green boiler. This was
increased to INR 860 Million with green
boiler i.e. an increase of INR 210 Million
was conceived due to the project activity. So
a consideration of only INR 55 million
incremental investment cost in project
activity is considered as a conservative
estimate.
2
3
Civil and mechanical cost for biomass

handling plant INR 55 Million
Biomass Price-INR 1000/tonne
Avant Garde TEFR, PSPD note to CMC for

Capex Approval dated 17 April 2008
Avant Garde TEFR
Since the project is presently operational, it is
observed from the biomass purchase invoices
that the actual price of biomass is about INR
1400/unit and the price is remaining the same
for all types of biomass residues purchased.
However, as per the guidance on investment
analysis, cost figures at the time of
investment decision need to be considered in
the investment analysis. Hence biomass price
has been considered at INR 1000/tonne. Also
from comparison between INR 1000/tonne
and INR 1400/tonne, INR 1000/tonne proves

CDM Executive Board
page 24
to be conservative.
Again, since it is seen that even during the
actual case, the biomass price is not varying
with the type of biomass hence a value of
INR 1000/tonne has been considered for all
types of biomass. A weighted average of
biomass price would also give the same
result.
Also To provide a sectoral view, an extract
from Determination of Tariff / Power
Purchase Price (Variable Cost or Single Part
Tariff) for the period from 01-04-2009 to 3103-2014 in respect of the New and
Renewable Sources of Energy in the State
of Andhra Pradesh covered by the
Commission Order Dated 20-03-20044 is
given below for reference:
In the case of these units also, in view of the
nature of the exercise for fixation of tariff ....
The need for revisiting the various
parameters towards fixation of variable cost
does not arise except in respect of the cost of
fuel, which changes with time. As regards the
determination of the appropriate cost of fuel,
there is a wide variation of fuel cost
proposed by various stake holders ranging
from Rs. 1,520 /MT (suggested by APPCC) to
2,200/MT (suggested by M/s. Velagapudi
Power Generation Ltd., and M/s. Suryateja
Power Projects Pvt. Ltd).
In these
circumstances, the Commission hereby
determines Rs. 2000/MT as the appropriate
fuel cost for determination of variable cost)
Hence from the above extract it is evident
that from a sectoral perspective also,
consideration of biomass price at INR 1000
unit is deemed conservative.
4
5
Coal Price-INR 868.45/tonne

Interest rate-13%
6
7
Increase in variable cost-6%

O&M-2.5% of project cost
Avant Garde TEFR

ITC hardle rate as per PSPD note to CMC for
Capex Approval dated 17 April 2008
ITC PSPD Plan-2008-09
ITC PSPD Plan-2008-09
http://www.aperc.gov.in/DraftOrder_chairman_300309_final.htm

CDM Executive Board
page 25
8
9
Depreciation-5.28%
NCV of coal-4579.43 kCal/kg
10
NCV of biomass-3650 kCal/kg
Companys Act , India

IMIS reports (January 2007 to December
2009)
Bhagavathi Ana Laboratory Test Reports
dated 12.03.2008
The weighted average NCV is calculated
based on the following:
Ratio of wood bark and other biomass
fired into the green boiler is 85.7%:
14.3% (As per the boiler specification
ratio of wood bark: other biomass: coal
60:10:30, resulting in a share of 85.7%
for wood bark and 14.3% of other
biomass like wood sliver, lops and tops,
chip dust amongst total 70% of biomass
residues fired; further segregation as per
weight ratio amongst biomass types like
wood sliver, lops and tops, chip dust
constituting the 14.3% would be possible
during ex-post measurement of all
biomass types)
GCVs and moisture contents for chip
dust, wood sliver and wood bark
available from the Bhagavathi Ana
Laboratory
Test
Reports
dated
12.03.2008 are used for calculation of
weighted average NCV of biomass
residues.
NCV is calculated as:
NCV= GCV 10.02*Moisture Content
11
12
Green Boiler Efficiency-80%

100% CFB efficiency-76.85%
Supplier Spec
Average operating efficiency of CFB 6 and
CFB 7 for 2007-08, 2008-09, 2009-10
Sensitivity Analysis:
Further, to ascertain the robustness of financial additionality as per the latest investment analysis
guidelines by CDM EB, a sensitivity analysis has been carried out on the biomass cost since it constitutes
more than 20% of the total cost:
Sensitivity on biomass price:
The results of sensitivity analysis show that with 10% decrease in the biomass price, unit cost of the
project activity per TJ of energy generated by the project boiler is INR 0.156 i.e. the project activity
remains the most financially unattractive option even with a 10% decrease in the biomass price. The

CDM Executive Board
page 26
project activity breaks even with the baseline scenario at about 31% decrease in the biomass cost.
Considering the rising trend of biomass price in Andhra Pradesh5 and noting the fact that as per the
Andhra Pradesh Tariff Order 2004 for Non-Conventional Energy Projects, by the Electricity Regulatory
Commission, the biomass price escalation at 5% has been considered as reasonable and fair, a decrease of
31% in biomass price is not a feasible possibility.
Sensitivity analysis on O&M cost, coal price has not been carried out because these costs do not
constitute 20% of the total project cost and since these costs are present both in baseline as well as in
project, the variation in these costs will have similar impact on both project and baseline financial
analysis.
The above analysis justifies the robustness of investment analysis of the project activity and the need of
CDM funds for sustaining project activity as a viable one. The CDM fund will help in improving the
financial sustainability of the project. The necessary documentary proofs are furnished to DOE for
verification.
Step 4: Common practice analysis
While the paper sector in India uses plantation based wood source for pulp-making, use of woody
biomass based boiler in this sector is not seen possibly on account of the myriad challenges of gathering
biomass and operating these projects of such a huge size in a sustainable manner and the availability of
cheap coal as an attractive alternative. Of the 20 comparable paper mills in India that use plantation based
wood, ITC accounts for the largest acreage of plantations and a report named Challenges of the New
Balance by the Centre of Science and Environment (CSE) dated 2010, shows that amongst the large
mills in India like BILT, APPM, WCPM, TNPL, SPBL, APPM, J K Paper, ITC has the largest forestry
based carbon sequestration. Since ITC has the largest forestry hence it has been possible for them to
conceive the design of the 90TPH biomass based project boiler with a predominant mix (~60%) of wood
barks Consequently, a biomass boiler of this size, conceived based on predominant use of bark is the
largest in the country and a first of a kind based on its unique fuel mix...
Also, the Annual Reports of Indian paper mills like TNPL6, APPM7 and SPBL8, BILT9 show that only
TNPL has been using wood barks and dust (assuming chip dust) as fuel for energy. However, the quantity
used in TNPL is only 2% of the proposed quantity to be fired in the new project boiler. This shows that
though TNPL do use wood barks and dusts, they do not have a boiler that has the capacity or the design
5
D:\ITC Details\Green_Boiler\GreenBoiler_FinalFiles\ITC Green Boiler PDD_17.05.10_dnv\Rising fuel costs

make biomass energy unattractive.mht
http://tnpl.com/web_pdf_files/TNPL%20AR2008_09.pdf Wood bark/ dust 2008-2009 2988MT; 2007-2008

1576MT
http://www.andhrapaper.com/images/pdf/appm-ar-2009-deluxe-full%20book_oct-16.pdf Husk/saw dust/others2008-2009 13457MT, 2007-2008 12427MT

8
http://www.spbltd.com/pdf/ar032009.pdf - Coconut shell - 2008-2009 3356MT, 2007-2008 3953MT
http://www.bilt.com/investor/Annual_Report2008-09.pdf

CDM Executive Board
page 27
fuel mix to fire the quantity of wood barks that is to be fired into the proposed project boiler. Also the
CSE report (Green rating project 2009) states that as a common practice in the Indian paper mills, there is
sub-optimal use of biomass residues like wood bark, chipping wastes etc. This clearly shows that the
proposed CDM project is not a common practice and is beset with challenges and barriers
The additionality tool requires the common practice analysis to be carried out in two steps:
(1) No similar activities can be observed and
(2) (2) If similar activities are observed, there are essential distinctions between the proposed CDM
project activity and similar activities
Hence the project is additional and passes the common practice test.
The Detailed chronology of the project activity is as follows:
CDM consultant was appointed on 15th September 2006, and given exclusive contract for taking
ITC through energy efficiency and renewable projects through the route of CDM whenever
applicable.
ITC PSPD note to CMC for Capital Expenditure Approval - 17th April, 2008
Capital Expenditure CMC approval for installation of Green Boiler decision of the project was
taken on 23rd April 2008 with CDM consideration as a critical parameter for project viability
Real Action Taken: The LOI for Design, Manufacturing of 90TPH Green Boiler, Document dated
5th July, 2008 was issued to TBW and advance money was submitted on 19th July 2008.
Thereafter DoE was appointed on 14th August 2008.
Stakeholder consultation for the project was conducted on 3rd September 2008,
First Host Government meeting on 5th September 2008
PDD webhosting for validation: November- December 2008
Validation Audit: 10 -14 March 2009
Second Host Government Meeting after reapplying with commitment of spending 2% of CDM
revenue on sustainable development of the community 17 September 2009
Final letter of approval from DNA on 17 November 2009
Green boiler commissioning 28th February 2010
The chronology presented above reinforces the additionality of the project activity through substantiation
of two facts:
1. The project was conceived with serious consideration of CDM:

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a) CDM consultant was appointed on 15 September 2006, when the project was at a conceptual
stage and it was way before submitting the letter of intent to the boiler manufacturer on 5 July
2008
b) The CMC approved the project on 23 April 2008 with serious consideration of CDM towards
project viability and stated carbon credits are expected to accrue on the project and these
contribute towards securing project viability
The approval text clearly mentions the word project viability to highlight the necessity of
accruing carbon credits towards financial viability of the project and hence CDM was considered
to be a serious proposition.
Also, the ITC PSPD note to CMC for Capital Expenditure Approval dated 17th April, 2008 based
on which the approval was given, clearly stated that the IRR from the project activity was less
than the ITC internal hurdle rate of 13% which is why consideration of CDM benefits became
imperative in project approval.
This is also substantiated by the fact that there was an additional investment of INR 55 million
towards the biomass handling plant which the PP could have easily avoided by going for a CFB
to bring in project viability. The extra investment effort was to secure emission reductions from
use of biomass at the cost of project viability.
Hence the project was approved by the CMC with serious consideration of CDM to ensure
financial viability of the project.
2. There was continuous real action towards securing the CDM status of project
B.6.
Emission reductions:
B.6.1. Explanation of methodological choices:

>>
The equations used as per the methodology to calculate the emission reduction are as follows:
Baseline Emissions:
Baseline emissions include CO2 emissions from fossil fuel combustion in the boilers in the absence of the
project activity and, CH4 emissions from the aerobic decay of biomass residues in the absence of the
project activity:
BEy = BEHG,y + BEBF,y
(1)

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Where:
Where:
BEy = Baseline emissions during the year y (tCO2e/yr)
BEHG,y = Baseline emissions from fossil fuel combustion for heat generation in the boiler(s) (tCO2 /yr)
BEBF,y = Baseline emissions due to uncontrolled burning or decay of the biomass residues (tCO2e/yr)
a)
Baseline emissions from fossil fuel combustion in boiler(s) for heat generation (BEHG,y)
Baseline emissions from fossil fuel combustion in the boiler(s) are determined by multiplying the heat
generated with fossil fuels that are displaced by biomass residues with the CO2 emission factor of the
least
carbon-intensive fossil fuels that would be used in the absence of the project activity and by dividing by
the average net efficiency of heat generation in the boiler(s), as follows:
BEHG,y=HGPJ,biomass,y*EFFF,CO2,y/boiler,FF
(2)
Where:
BEHG,y = Baseline emissions from fossil fuel combustion for heat generation in the boiler(s) (tCO2e /yr)
HGPJ,biomass,y = Heat generated with incremental biomass residues used as a result of the project activity
during the year y (GJ/yr)
EFFF,CO2,y = CO2 emission factor of the fossil fuel type displaced by biomass residues (tCO2e /GJ)
boiler,FF = Average net efficiency of heat generation in the boiler(s) when fired with fossil fuels
As per the methodology for the purpose of determining EFFF, CO2, y, as a conservative approach, the least
carbon intensive fuel type (i.e. the fuel type with the lowest CO2 emission factor per GJ) should be used
among the fossil types used in boilers at the project site during the most recent three years2 prior to the
implementation of the project activity and the fossil fuel types used in boilers at the project site during the
year y.
Before the implementation of the project activity only coal is used as the fuel in the boiler that is to be
replaced by the project activity. This can be substantiated by the plant records kept by the project
proponent.
Since in the project case only coal and no biomass is used as fuel prior to project implementation hence as
per the methodology guidance under case A will be followed to determine HGPJ,biomass,y
Case A: No use of biomass for heat generation in the absence of the project activity
In this case, HGPJ,biomass,y corresponds to the total quantity of heat generated from firing biomass residues
(HGPJ,biomass,y = HGPJ,biomass,total,y).HGPJ,biomass,total,y is determined based on the fraction of biomass residues that
are used for heat generation in the boiler(s), taking into account all biomass residue types k and fossil fuel
types i fired in the project boilers during a year y, as follows:

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Where:
HGPJ,biomass,total,y = Total heat generated from firing biomass residues in all boilers at the project site during
the year y (GJ/yr)
HGPJ,total,y = Total heat generated in boilers at the project site, using both biomass residues and fossil fuels,
BFk,y = Quantity of biomass residue type k fired in all boiler(s) at the project site during the year y (tons of dry
matter)
NCVk = Net calorific value of the biomass residue type k (GJ/ton of dry matter)
FCi,y = Quantity of fossil fuel type i fired in the existing boiler replaced by the project actvity during the year y
(MT)
NCVi = Net calorific value of the fossil fuel type i (GJ/MT)
b) Baseline emissions due to uncontrolled burning or decay of the biomass residues

As per the approved methodology if included in the project boundary, baseline emissions due to
uncontrolled burning or decay of the biomass residues (BEBF,y) should be determined consistent with the
most plausible baseline scenario for the use of the biomass residues.
For this purpose, the quantity of biomass residue for each biomass residue type k used for heat generation
as a result of the project activity (BFPJ,k,y) is determined as follows:
Since in the project case no biomass has been used for heat generation at the project site during the most
recent three years prior to the implementation of the project activity and the most plausible baseline
scenario is that heat would continue to be generated only with fossil fuel coal, BFPJ,k,y = BFk,y is used
for all biomass residue types k.
Aerobic decay of the biomass residues
3. Since the most likely baseline scenario in the project case for the use of the biomass residues that
the biomass residues are burnt in an uncontrolled manner without utilizing them for energy
purposes. (B3) as per the methodology it is assumed that there are baseline CH4 emissions due to
uncontrolled burning of the biomass residues.
Baseline emissions are calculated by multiplying the quantity of biomass residues that would not be used
in the absence of the project activity with the net calorific value and an appropriate emission factor, as
follows:
(4)
Where:
BEBF,y = Baseline emissions due to uncontrolled burning or decay of the biomass residues (tCO2e/yr)
GWPCH4 = Global Warming Potential of methane valid for the commitment period (tCO2e/tCH4)

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BFPJ,k,y = Quantity of biomass residue type k used for heat generation as a result of the project activity during
the year y (tons of dry matter or liter)5
NCVk = Net calorific value of the biomass residue type k (GJ/ton of dry matter or GJ/liter)
EFburning,CH4,k,y = CH4 emission factor for uncontrolled burning of the biomass residue type k during the year y
(tCH4/GJ)
k = Types of biomass residues for which the identified baseline scenario in the project case is B3 and for
which leakage effects have been ruled out with the approach L2 as described in the leakage section
A factor of 0.0027 t CH4 per ton of biomass has been used as a default value for the product of NCVk and
EFburning,CH4,k,y. as per the methodology. The uncertainty of the CH4 emission factor is in many cases
relatively high and can be deemed to be greater than 100%, resulting in a conservativeness factor of 0.73.
Thus, in this case an emission factor of 0.001971 t CH4/t biomass has been used.
Project Emissions:
Project emissions are calculated as follows:
(5)
Where:
PEy = Project emissions during the year y (tCO2/yr)
PECO2,FF,y = CO2 emissions from on-site fossil fuel combustion attributable to the project activity (tCO2/yr)
PECO2,EC,y = CO2 emissions from on-site electricity consumption attributable to the project activity
(tCO2/yr)
PECO2,TR,y = CO2 emissions from off-site transportation of biomass residues to the project site (tCO2/yr)
GWPCH4 = Global Warming Potential of methane valid for the commitment period (tCO2e/tCH4)
PECH4,BF,y = CH4 emissions from combustion of biomass residues in the boiler(s) (tCH4/yr)
a) CO2 emissions from on-site fossil fuel combustion (PECO2, FF, y)
As per the methodology PECO2, FF, y should not include the quantity of fossil fuels co-fired in the project
boiler but only other quantities of fossil fuels used at the project site that are attributable to the project
activity .In the project case there is no fossil fuel consumption at the project site that can be attributed to
the project activity.
b) CO2 emissions from on-site electricity consumption (PECO2, EC, y)
The project activity involves preparation of biomass through chippers and shredders that consume
electricity. This electricity consumption is attributable to the project activity and hence CO2 emissions
from on-site electricity consumption (PECO2, EC, y) has been included in the emission reduction calculation.
PECO2,EC,y = EC,PJ,y *Efy
(6)
Where:
PECO2,EC,y = CO2 emissions from on-site electricity consumption attributable to the project activity

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(tCO2/yr)
ECPJ,y = On-site electricity consumption attributable to the project activity during the year y (MWh)
EFgrid= Combined CO2 emission factor of the grid consumption and in-house generation (tCO2/MWh) to
the grid EF (EFgrid) has been considered as 0.85 tCO2/MWh as per the latest CEA database version 04
and to be fixed ex-ante and the in-house EF (EFin-house) to be calculated based on monitored parameters.
EF is calculated using the following equation:
EFy = (EFgrid *Egrid + EFin-house * Ein-house) / (Egrid + Ein-house)
(7)
= Emission Factor of the electricity mix of the unit (tCO2/MWh)

EFy
EFgrid = Emission Factor for the grid electricity used (tCO2/MWh) - fixed ex-ante from CEA database
Egrid = Total grid electricity imported in the year y (MWh)
Ein-house = Total in-house electricity generated in the year y (MWh)
EFin-house = Emission Factor for the in-house electricity used (tCO2/MWh) monitored ex-post
EFin-house = FFi,y * COEFFF,i/ Ein-house
(8)
FFi,y = Amount of fossil fuel by type i required to generate electricity in the year y (MT)
The CO2 emission coefficient COEFi is obtained as
COEFFF,i = NCVFF,i * EFCO2, FF,i
(9)
Where:
NCVFF,i = Net calorific value (kcal /kg) of the fossil fuel used in power generation
EFCO2, FF,i = CO2 emission factor per unit of energy of the fossil fuel used in power generation
c) CO2 emissions from transportation of biomass residues to the project site (PETR, CO2, y)
In the project case the biomass residues will be carried to the plant site from the agricultural and biomass
site hence project emissions from combustion of fossil fuel for transportation of biomass residues have
been considered in the calculation of emission reductions. In the project case biomass residues are
transported from the field to the project site by trucks. So emissions due to transportation of biomass has
been considered based on vehicle type (option 1) based on average truck load.
kBFPJ, k,y
PETR, CO2, y =
AVDy.EFkm.CO2,y
(10)
TLy
Where:
PETR, CO2, y = CO2 emissions during the year y due to transport of the biomass residues to the project plant
(tCO2/yr)
Ny = Number of truck trips during the year y
AVDy = Average round trip distance (from and to) between the biomass residue fuel supply sites and the
site of the project plant during the year y (km)
EFkm, CO2,y = Average CO2 emission factor for the trucks measured during the year y (tCO2/km)

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BFPJ,k,y = Quantity of biomass residue type k used for heat generation as a result of the project activity
during the year y (tons of dry matter or liter)
TLy = Average truck load of the trucks used (tons or liter) during the year y.
k = Types of biomass residues used in the project plant and that have been transported to the project plant
in year y
d) CH4 emissions from combustion of biomass residues in the boiler(s) (PECH4, BF, y)
Emissions are calculated as follows:
PECH4, BF, y = EFCH4, BF. BFPJ,k,y .NCVk
(11)
Where:
BFPJ,k,y = Quantity of biomass residue type k combusted in the project plant during the year y(tons of dry
matter or liter)
NCVk = Net calorific value of the biomass residue type k (GJ/ton of dry matter or GJ/liter)
EFCH4, BF = CH4 emission factor for the combustion of biomass residues in the project plant (tCH4/GJ)
To determine the CH4 emission factor, IPCC default values, as provided in Table 4 and table 5 of the
methodology has been used. Here the default CH4 emission factor of 30 kg/TJ from Table 4 and table
5has been used, the uncertainty is estimated to be 300%, resulting in a conservativeness factor of 1.37.
Thus, in this case a CH4 emission factor of 41.1 kg/TJ has been used.
Leakage:
The approved methodology gives option to the PP on which approach to use depending on the most
plausible baseline scenario for the use of the biomass residues. Where scenarios B1, B2 or B3 apply, the
methodology allows the use of approaches L1, L2 or L3. Since the most plausible baseline scenario in the
project case is B3 the PP has chosen approach L2 that states Demonstrate that there is an abundant
surplus biomass residue of the in the region of the project activity which is not utilized. For this purpose,
demonstrate that the quantity of available biomass residues of type k in the region is at least 25% larger
than the quantity of biomass residues of type k that are utilized (e.g. for energy generation or as
feedstock), including the project plant.
As per the requirement of the approach L 2 the proponent has conducted a comprehensive biomass survey
was conducted for availability of agro residues and plantation wood biomass residues such as wood barks
in the District of Khammam within 200 km radius of ITC PSPD Bhadrachalam, Sarapakka during
November December 2009 by Forest Research Center (Indian Council of Forestry Research and
Education) Hyderabad. The survey report (dated March 31, 2010), based on the primary data collected by
the Forest Research Centre clearly mentions that there is a surplus availability of biomass residue for the
project activity. Hence no leakage has been considered for the project activity as per the methodology
applied. The survey report clearly mentions the total availability, demand of consumers, and demand of
the project to arrive at the surplus. The details of the surplus availability of two sources of biomass
residues used in the project activity are delineated below:

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1) Biomass Residues from Plantation Wood: As per the survey report the total availability of
biomass residues from ITC & private nursery promoted plantations is 0.535 Million MT per
annum. ITC provides samples for these plantations and uses the de-barked wood produced for
their own pulp mill generation. The farmers harvest the plantation. The de-barked wood is
purchased by ITC from the farmers as the raw material to the paper making process. The
biomass residues, i.e. the wood barks, lops and tops obtained from these plantations are not being
used by the farmers and are left in the fields. . The total quantity available is thus a surplus. The
surplus available after considering the project demand is 0.430 Million MT. For the purpose of
the project activity, ITC would purchase these biomass residues from the farmers at a certain
price. The farmers in exchange of the price paid to them, would collect the residues across the
fields, would size up the wood barks, lops and tops uniformly, bundle up the residues and would
load the biomass residues and arrange for transport of biomass by trucks..
2) Agricultural Biomass Residues: The survey report states that the total surplus availability of
agriculture biomass residues is 0.652 Million MT per annum after considering the demand of
these residues from the local farmers for fuel, shelter etc and project demand. Hence the
remaining quantity is a surplus.
Considering about 0.116 Million MT per annum of biomass requirement as per the design of the
project boiler it can be stated that there is more than 100% surplus availability of biomass residues for
the project activity.
The following table shows the availability and consumption (demand), surplus details of biomass
residues:
Surplus Availability of Biomass Residues - Agricultural
Residues
From agricultural residues
Demand of agricultural residues
Demand of Project Activity
Total Demand of Agricultural Residues
Surplus agricultural residues
% surplus of agricultural residues
Surplus Availability of Biomass Residues - Plantation
Residues
From ITC & Private plantation
Demand of ITC & Private plantation
Demand of Project Activity
Total Demand of plantation biomass residues
Surplus
% Surplus
0.883
0.219
0.017
0.236
0.647
275
Million MT
Million MT
Million MT
Million MT
Million MT
%
0.535
0
0.099
0.099
0.436
439
Million MT
Million MT
Million MT
Million MT
Million MT
%
Emission reductions
Emission reductions are calculated as follows:
ERy = BEy - PEy - LEy

Where :
(12)

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ERy = Emission reductions during the year y (tCO2/yr)

BEy = Baseline emissions during the year y (tCO2/yr)
PEy = Project emissions during the year y (tCO2/yr)
LEy = Leakage emissions during the year y (tCO2/yr)
B.6.2. Data and parameters that are available at validation:

Data / Parameter:
Data unit:
Description:
Source of data used:
Value applied:
Justification of the
choice of data or
description of
measurement methods
and procedures actually
applied :
Any comment:
Data / Parameter:
Data unit:
Description:
boiler,FF
Average net efficiency of heat generation in the boiler(s) when fired with fossil
fuels
the higher value among (a) the measured efficiency prior to the implementation of
the project activity
100%
As per the methodology an efficiency of 100% has been considered for
conservative estimation
MWh
Highest historical electricity generation of the cogeneration plant during the

most recent three years prior to the implementation of the project activity
On-site measurements
Value applied:
choice of data or
description of
measurement methods
applied :
Any comment:
500559.5
Data / Parameter:
Data unit:
Description:
The project commissioning was on 28th February 2010. Hence Mill PR data from
March 07 to Feb 10 has been considered for choice of data.
Required to assess the applicability condition referring to power generation at

the project site.
EF km,CO2,y
tCO2/KM
Average CO2 emission factor per Km for the trucks during the year y
CEA database version 04, India Road Transport Service Efficiency Study by
World Bank, November 2005, Table A1.3 Main Assumptions for Typical Truck
Operating Cost Estimates, IPCC

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Value applied:
choice of data or
description of
measurement methods
applied :
0.00059
Publicly available information:
Density of diesel-0.83 kg/litre
http://www.cea.nic.in/planning/c%20and%20e/user_guide_ver4.pdf
(version available during the webhosting of PDD)
EF of disel-3.18 kgCO2/kg of fuel- IPCC
Diesel consumed at km/litre-4.5- as per India Road Transport Service

Efficiency Study by World Bank, November 2005, Table A1.3 Main
Assumptions for Typical Truck Operating Cost Estimates
Any comment:
Data / Parameter:
Data unit:
Description:
EFgrid
tCO2/MWh
Grid emission factor
CEA database version 04
Value applied:
choice of data or
description of
measurement methods
applied :
Any comment:
0.85
Required for calculation of combined EF; the CEA version 04 as available
during the webhosting of the PDD has been used for calculation. CEA uses
"Tool to Calculate the Emission Factor for an Electricity System", Version 1.1
to arrive at the combined EF.
B.6.3. Ex-ante calculation of emission reductions:

>>
The equations used in the calculation of emission reductions are given in detail in the section B.6.1.The
detailed description of calculation followed to estimate ex-ante emission reductions are as below:
Assumptions used in the emission reduction calculation:
Parameters
Values
Units
Source
Net Enthalpy of
steam
672
Kcal/Kg
Calculated based on Supplier

Specification
Steam generation
90
TPH
Supplier Design Specification
operating hours in
a year
8000
hrs
PSPD Note for Capex Approval

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Parameters
Values
Units
Source
Boiler Efficiency )
80
Supplier Design Specification
NCVk
15.28
GJ/ton
3650 kcal/kg as per

Bhagavathi Ana Laboratory
Test Reports dated
12.03.2008, converted to
GJ/ton (on dry basis)
NCVi
19.17
GJ/ton
EFFF,CO2,y (N)
0.07
tCO2/GJ
boiler,FF (O)
1.00
4579 kcal/kg as per utility

records of most recent three
years, converted to GJ/ton
Calculated based on utility
data of Jan 2007-Dec
2008.Minimum of all values
have been taken as a
conservative estimate.
100% efficiency as
conservative
TLy- Average truck

load (R)
tons
Estimated from biomass

invoices
AVD_y (T)
400
KM
Biomass survey report
EFKmCO2y (U)
0.00059
tCO2/Km
calculated
Leakage (Z)
tCO2
calculated
EFburning_CH4_k_y
(AA)
0.002
tCH4/tBiom
ass
Methodology
Calculation of Baseline Emissions:

HG PJ, total, y = (Steam Generation by the green boiler (TPH) * Net enthalpy of steam (kcal/kg) * operating
hours in a year * 10^3*4.186/10^6) GJ/year
= 90 * 672* 8000*10^3*4.186/10^6 = 2024215 GJ/year

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Where, HGPJ,total,y = Total heat generated in boilers at the project site, using both biomass residues and
fossil fuels, during the year y (GJ/yr)
And,
Total heat input to the boiler = HG PJ, total,y/(efficiency of green boiler in %) = 2024215/ 80% = 2530269
GJ/year
Energy from biomass residues = 70% * 2024215 = 1771188.30 GJ/year (as per boiler design
specification)
Hence BFk,y = Energy from biomass residues/ NCVk
= 1771188.30 (GJ/year) / 15.28 (GJ/ton) = 115920.66 tons/year
Where,
BFk,y = Quantity of biomass residue type k fired in all boiler(s) at the project site during the year y (tons of dry
matter)
NCVk = Net calorific value of the biomass residue type k (GJ/ton of dry matter)
Energy from fossil fuel i.e. coal = 30% *2024215 =759080.7 GJ/year (as per boiler design specification)
Hence FCi,y = Energy from biomass residues/ NCVi
= 759080.7 (GJ/year)/19.17 (GJ/ton) = 39598.40 ton/year
Where,
FCi,y = Quantity of fossil fuel type i fired in the existing boiler replaced by the project actvity during the year y
(MT)
NCVi = Net calorific value of the fossil fuel type i (GJ/MT)
Hence,
HGPJ,biomass,y = HGPJ,biomass,total,y = HGPJ,total,y * BFk,y* NCVk/(BFk,y* NCVk + FCi,y* NCVi) (3)
= 2024215 * 115920.66 *15.28 / (115920.66 *15.28 + 39598.40* 19.17)
= 1416950.64 GJ/year
Where,
HGPJ, biomass, total,y = Total heat generated from firing biomass residues in all boilers at the project site during
the year y (GJ/yr)
HG PJ,biomass,y = the total quantity of heat generated from firing biomass residues
In this case, HGPJ, biomass, total,y = HG PJ,biomass,y
Hence,

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BEHG,y=HGPJ,biomass,y*EFFF,CO2,y/boiler,FF
= 1416950.64 (GJ/year) * 0.07 (tCO2/GJ) / 100%
= 94307.06 tCO2/year
(2)
Where, BEHG,y = Baseline emissions from fossil fuel combustion for heat generation in the boiler(s) (tCO2
/yr)
BEBF,y = BF PJ,k,y (ton/year) * EFburning,CH4,k,y (tCH4/t biomass) * 21 = 115920.66 * 0.002 * 21 =

4798.07 tCO2/year (since BF PJ,k,y = BF k,y )
Where, BEBF,y = Baseline emissions due to uncontrolled burning or decay of the biomass residues
(tCO2e/yr)
Hence Total Baseline Emissions:

BEy = BEHG,y + BEBF,y
(1)
= (94307.06 + 4798.07) tCO2/year

= 99105 tCO2/year
Calculation of Project Emissions:
Calculation of PECO2,
activity (tCO2/yr)
FF, y:
CO2 emissions from on-site fossil fuel combustion attributable to the project
PECO2, FF, y = 0 tCO2 /year (since there is no fossil fuel consumption attributable to the project activity)
PECO2, EC, y: CO2 emissions from on-site electricity consumption attributable to the project activity
(tCO2/yr)
PECO2,EC,y = EC,PJ,y *EFy
(6)
EC,PJ,y = 1400 (kW) * 8000 (hrs/year)/10^3 = 11200 MWh (1400 kW capacity of chippers & shredders)
Where, ECPJ,y = On-site electricity consumption attributable to the project activity during the year y
(MWh)
EFgrid= Combined CO2 emission factor of the grid consumption and in-house generation (tCO2/MWh) to
the grid EF (EFgrid) has been considered as 0.85 tCO2/MWh as per the latest CEA database version 04
and to be fixed ex-ante and the in-house EF (EFin-house) to be calculated based on monitored parameters.
EF is calculated using the following equation:
and EFy = (EFgrid *Egrid + EFin-house * Ein-house) / (Egrid + Ein-house)
(7)
= (0.85 tCO2/MWh* 8528 MWh + 1.45 tCO2/MWh * 485945 MWh)/ (8528 MWh+485945
MWh)
= 1.44 tCO2/MWh
Hence, PECO2, EC, y = 11200 (MWh) *1.44 tCO2/MWh

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= 16127.47 tCO2/year
PECO2, TR, y: CO2 emissions from off-site transportation of biomass residues to the project site (tCO2/yr)
kBFPJ, k,y
PETR, CO2, y =
AVDy.EFkm.CO2,y
(10)
TLy
= (115920.66/4) trips * (2*200) km * 0.00059 tCO2/km
= 6799.13 tCO2/year
Where,
Ny = Number of truck trips during the year y
AVDy = Average round trip distance (from and to) between the biomass residue fuel supply sites and the
site of the project plant during the year y (km)
EFkm, CO2,y = Average CO2 emission factor for the trucks measured during the year y (tCO2/km)
BFPJ,k,y = Quantity of biomass residue type k used for heat generation as a result of the project activity
during the year y (tons of dry matter or liter)
TLy = Average truck load of the trucks used (tons or liter) during the year y considered as 4 tonnes
k = Types of biomass residues used in the project plant and that have been transported to the project plant
in year y
ECH4, BF, y: CH4 emissions from combustion of biomass residues in the boiler(s) (tCH4/yr)
PECH4, BF, y: = EFCH4, BF. BFPJ,k,y .NCVk
(11)
= 41.1(kg CH4/TJ) * 115920.66 (tons) * 15.28 (GJ/ton)/10^6
= 72.80 tCH4/year
Total Project Emissions:

PEy = PECO2, FF, y + PECO2, EC, y + PECO2, TR, y + PECH4, BF, y * 21
= 0 + 16127.47+ 6799.13 + 72.80*21
= 24455 tCO2/year
(5)
Calculation of Leakage Emissions:

Under section B.6.1, more than 100% surplus availability of biomass has been established considering
approach L2. Hence,
LEy = 0
Where, LEy = Leakage emissions during the year y (tCO2/yr)
Emission reductions in tCO2/year are calculated as follows:

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ERy = BEy - PEy - LEy = (99105 24455-0) = 74650 tCO2/year

Where, ERy = emission reductions during the year y (tCO2/yr)
B.6.4
>>
Year
Year 1*
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Total
tonnes of
CO2e
Summary of the ex-ante estimation of emission reductions:
Estimation of
project activity
emissions (tonnes
of CO2e)
24455
24455
24455
24455
24455
24455
24455
24455
24455
24455
244550
Estimation of baseline
emissions (tonnes of
CO2e)
99105
99105
99105
99105
99105
99105
99105
99105
99105
99105
991050
Estimation of
leakage
(tonnes of
CO2e)
0
0
0
0
0
0
0
0
0
0
0
Estimation of overall
emission reductions
(tonnes of CO2e)
74650
74650
74650
74650
74650
74650
74650
74650
74650
74650
746500
*The start date of the crediting period is tentatively 01/07/2011

B.7.
Application of the monitoring methodology and description of the monitoring plan:
B.7.1
Data and parameters monitored:
Data / Parameter:
Data unit:
Description:
Source of data to be
used:
Value of data applied
for the purpose of
calculating expected
emission reductions in
section B.5
Description of
BFk,y
tons of dry matter
Quantity of biomass residue type k combusted in the project plant during the year
y
115920.66
For each biomass type used in the project activity measurement will be

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measurement methods
and procedures to be
applied:
conducted using weighbridge (accuracy as specified by the manufacturer:

0.025%) on a daily basis and adjusted for the moisture content in order to
determine the quantity of dry biomass. The quantity is crosschecked with the
quantity of electricity (and heat) generated and with any fuel purchase receipts.
QA/QC procedures to
be applied:
Crosschecking the measurements with an annual energy balance that is based on

purchased quantities and stock changes. The accuracy check of the weighbridge
will be done once a year as per the calibration schedule followed by the PP
Any comment:
Data / Parameter:
Data unit:
Description:
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
BFPJ,k,y
tons of dry matter
Quantity of biomass residue type k used for heat generation as a result of the
project activity during the year
115920.66
For each biomass type used in the project activity measurement will be
conducted using weighbridge (accuracy as specified by the manufacturer:
0.025%) on a daily basis and adjusted for the moisture content in order to
determine the quantity of dry biomass. The quantity is crosschecked with the
quantity of electricity (and heat) generated and any fuel purchase receipts.
Crosschecking the measurements with an annual energy balance that is based on
purchased quantities and stock changes. The accuracy check of the weighbridge
Any comment:
Data / Parameter:
EFFF,CO2,y
Data unit:
Description:
tCO2e/GJ
CO2 emission factor of the fossil fuel type displaced by biomass residues for the
year y
Measurements are conducted to derive the CO2 emission factor of coal fired in
the coal fired boilers.
0.07
used:
for the purpose of
section B.5
Description of
The carbon content of coal fired in the coal fired boilers is monitored through

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measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
external laboratory tests taking 3 samples for each measurement and recorded
monthly. The GCV of coal is tested in the in-house central laboratory and
recorded on a daily basis
The accuracy check of all the instruments and meters is done once a year as per
the calibration schedule followed by the PP
Data / Parameter:
HGPJ,total,y
Data unit:
GJ/yr
Description:
Total heat generated from firing biomass residues in all boilers at the project site
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
2024215
Heat generation is determined as the difference of the enthalpy of the steam

generated by the boiler(s) minus the enthalpy of the feed-water, the
boiler blow-down and any condensate return.
The HP steam generation from the project boiler will be monitored on a
continuous basis using calibrated steam flow meters (accuracy as specified by the
manufacturer: +/- 0.065%) and recorded on a daily basis; the HP steam pressure
and temperature will be monitored continuously using pressure (accuracy as
specified by the manufacturer: +/- 0.075%) and temperature transmitters
(accuracy as specified by the manufacturer: +/- 0.03%) and recorded on a daily
basis. Based on pressure and temperature enthalpy is obtained from the steam
table.
Feed water temperature will also be monitored using temperature transmitters
and recorded daily.
The consistency of metered net heat generation will be cross-checked with the
quantity of biomass and/or fossil fuels fired .The accuracy check of the
weighbridge, steam flow meter, pressure and temperature transmitter will be
done once a year as per the calibration schedule followed by the PP.
Any comment:
Data / Parameter:
Data unit:
Description:
Moisture content of the biomass residues

% Water content
Moisture content of each biomass residue type k

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used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Biomass Type
Chip Dust
Bark
Moisture
Content (%)
10.34
8.86
Slivers
7.12
Moisture content is analysed in the internal laboratory and recorded monthly
The accuracy check of the instruments will be done once a year as per the
calibration schedule followed by the PP
Any comment:
Data / Parameter:
Data unit:
Description:
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
EFCH4,BF
kgCH4/TJ
CH4 emission factor for the combustion of biomass residues in the project plant
default values, as provided in Table 4 and table 5 of methodology
Data / Parameter:
Data unit:
Description:
AVDy
Km
Average round trip distance (from and to) between biomass fuel supply sites and
the project site
fuel receipts
used:
for the purpose of
section B.5
Description of
41.1
400
The distance is obtained from fuel receipts obtained and recorded as and when

CDM Executive Board
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measurement methods
applied:
QA/QC procedures to
be applied:
biomass is received
Checking consistency of distance records provided by the truckers by comparing

recorded distances with other information from other sources (e.g. maps).
Any comment:
Data / Parameter:
Data unit:
Description:
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
TLy
tons
Average truck load of the trucks used for transportation of biomass.
Data / Parameter:
Data unit:
Description:
used:
for the purpose of
section B.5
NCVk
GJ/ton of dry matter
Net calorific value of biomass residue type k
Measurements
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Trucks carrying the biomass to plant will be weighed in weighbridge and

recorded as when biomass is received.
Cross cheeked against the tons of wet biomass collected
Biomass Type
Chip Dust
NCV
(GJ/Ton)
17.90
Bark
14.78
Slivers
18.62
Measurements shall be carried out for all biomass types used in the project
activity at a reputed laboratory and according to relevant international standards
at least every six months, taking at least three samples for each measurement
Checking consistency of measurements and local / national data with default
values by the IPCC. If the values differ significantly from IPCC default values,

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additional measurements will be conducted.

Any comment:
Data / Parameter:
FCi,y
Data unit:
Description:
Tonnes
Quantity of fossil fuel type i fired in the project boiler
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
On site Measurements
39598.40
Quantity of coal fired into the boilers will be measured through weighbridge.
Coal is fed into respective boilers for which it is weighed by the weighbridge and
data is logged online in SAP for the respective boilers (accuracy as specified by
the manufacturer: 0.025%)and will be recorded daily
Cross-checking the measurements with an annual energy balance that is based on
purchased quantities and stock changes. The accuracy check of the weigh meter
Any comment:
Data / Parameter:
Data unit:
Description:
NCVi
GJ/ton
Net calorific value of fossil fuel type I
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
On site measurements
19.17
The GCV and moisture content of coal is tested in the in-house central laboratory
as per ISO standards in place and recorded on a daily basis . The NCV of coal is
then calculated using the formula NCV = GCV-10.02* Moisture Content
For cross checking the values obtained from the in-house laboratory, at least
every six months, taking at least three samples for each measurement. would be
sent to a govt. accredited, reputed external laboratory.

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QA/QC procedures to
be applied:
Checking consistency of measurements with default values

by the IPCC. If the values differ significantly from IPCC default values
additional measurements will be conducted.
The accuracy check of the meters will be done once a year as per the calibration
schedule followed by the PP
Any comment:
Data / Parameter:
Data unit:
Description:
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
Data / Parameter:
Data unit:
Description:
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
EFburning,CH4,k,y
tCH4/GJ
CH4 emission factor for uncontrolled burning of the biomass residue type k
IPCC default value
The value of the product of EFburning,CH4,k,y and NCVk is taken

0.001971
Default values to be reviewed annually
Lakh MT
Quantity of available biomass residues of type k or m in the region
Biomass availability survey

Quantity of surplus available from agricultural residues- 0.647 Million MT
Quantity of surplus available from plantation-0.436 Million MT
Monitored and recorded annually

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Data / Parameter:
Data unit:
Description:
E_inhouse
GWh
In-house Electricity generation during the year y at the project site
used:

for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
Jan-09 34.47
Feb-09 36.01
Mar-09 39.69
Apr-09 41.88
May-09 44.49
Jun-09 39.18
39.39
Jul-09
Aug-09 44.07
Sep-09 39.24
Oct-09 40.70
Nov-09 42.59
Dec-09 44.24
Energy meters are used for measurement. Power generation from the
cogeneration plant is monitored continuously and recorded daily
The accuracy check of the energy meters is done once a year as per the
Data / Parameter:
Data unit:
Description:
E_grid
MWh
Grid Electricity generation during the year y at the project site
used:
for the purpose of
section B.5
Jan-09
Feb-09
Mar-09
Apr-09
May-09
Jun-09
0.40
0.27
0.56
0.07
0.07
0.78

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Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
1.63
Jul-09
Aug-09 0.22
Sep-09 2.47
Oct-09 1.38
Nov-09 0.19
Dec-09 0.47
Energy meters are used for measurement. Power generation from the
cogeneration plant is monitored continuously and recorded monthly
Data / Parameter:
ECPJ,y
Data unit:
Description:
MWh
On-site electricity consumption attributable to the project activity during the year
y
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
11200
separate on-line energy meters will measure the electricity consumption of

chippers and shredders in the biomass preparation plant and recorded daily
Data / Parameter:
Data unit:
Description:
FFi,y
MT
Amount of fossil fuel by type i required to generate electricity in the year y
used:
for the purpose of
section B.5
Months
Coal
Diesel
Units
MT
MT

CDM Executive Board
page 50
Description of
measurement methods
applied:
QA/QC procedures to
be applied:
Any comment:
Data / Parameter:
Data unit:
Description:
used:
for the purpose of
section B.5
Description of
measurement methods
applied:
Jan-09
36810 1.94
Feb-09
33245 1.86
Mar-09
36331 2.68
Apr-09
36226 0.40
May-09
36980 6.59
Jun-09
35562 5.05
Jul-09
38908 23.91
Aug-09
43095 13.13
Sep-09
38749 9.68
Oct-09
37602 1.65
Nov-09
38108 0.86
Dec-09
43505 7.37
Quantity of coal and diesel is monitored and recorded on daily basis
The accuracy check of the weighbridge is done once a year as per the calibration
schedule followed by the PP
EFgrid
tCO2/MWh
Grid emission factor
From latest CEA database version 04
0.85
The combined margin grid emission factor has been used for calculation. CEA
database version 04 as available during the webhosting of the PDD has been used
for calculation.CEA uses "Tool to Calculate the Emission Factor for an
Electricity System", Version 1.1 to arrive at the combined emission factor. The
same factor will be used for project emission calculation
QA/QC procedures to
be applied:
Any comment:
B.7.2. Description of the monitoring plan:

>>

CDM Executive Board
page 51
The project activity will be operated and managed by the project proponent. All data pertaining to GHG
emission reduction calculations will be monitored and recorded through trained personnel as per the
management system present at the project site.
The CDM project would have a management system for the smooth operation and monitoring of the
project in line with the requirements of the operating instructions and requirements of the CDM
methodology applied and as given in the PDD, the approved methodology and the monitoring plan. The
entire operations would be dovetailed into the ISO procedures and work instructions and the project
would have an organizational structure with defined responsibilities to oversee day to day activities as
needed under the operations manual.
All data will be archived till 2 years after the completion of the crediting period.
Action Plan for Monitoring of up to 2% CER Revenue Committed towards Sustainable
Development
ITC - PSPD (ITC or the Company) is committed to contributing up to 2% of the CDM revenue realized
from the sale of CERs towards sustainable development including society/community development
activities. The expected CER revenue generation from the project and the annual revenue committed
towards the above are summarized in the table below:
Years
Estimation of total
emission reductions
(tCO2e)
Estimated
CER
Price*
(Euro)
Estimation of CER
Revenue Generation
(INR)
Estimation of revenue
committed for
sustainable
development upto 2%
as per guidelines
(INR)
Year 1
Year 2
Year 3
Year 4
Year 5
74650
74650
74650
74650
74650
10
10
10
10
10
44790000
44790000
44790000
44790000
44790000
895800
895800
895800
895800
895800
Year 6
Year 7
Year 8
Year 9
Year
10
74650
74650
74650
74650
74650
10
10
10
10
10
44790000
44790000
44790000
44790000
44790000
895800
895800
895800
895800
895800
* The estimated CER price and the exchange rate used in determining the estimated CER revenue are as
per the assumptions used in the financial modeling and analysis of the project.
** The actual annual revenue committed to be contributed towards sustainable development activities in
the local communities would vary each year and depend on the actual realization of CDM revenue based
on variables such as the CER price and the Euro exchange rate.
ITC will undertake an annual review of the actual CERs accrued and the price transacted. On the basis of
the actual price and exchange rate, ITC will commit upto 2% of the revenue for sustainable development
activities including society/community development carried out by the Company from time to time. The

CDM Executive Board
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areas of activities will include health, education, sanitation, skill development, infrastructure
development, etc.
The annual review process will ensure that upto 2% of CER revenue is spent on the above mentioned
programs.
The authority and responsibility of project registration and overall project management lies with the CDM
coordinator, who is the Executive Vice President (Finance & MIS), ITC - Paperboards and Specialty
Papers Division
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 completing the final draft of this baseline section (DD/MM/YYYY): 24.01.2011
Name of the responsible entity: ITC - Paperboards and Specialty Papers Division (PSPD)
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:
>>
5/07/ 2008-Being the Letter of Intent for Design, Manufacturing of 90TPH Green Boiler,
C.1.2. Expected operational lifetime of the project activity:
>>
The project would be operational for 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:
>>
NA
>>
NA
C.2.2. Fixed crediting period:
C.2.2.1.
Starting date:
>>
From the date when the project would be operational or registered, whichever is later tentatively
01/07/2011

CDM Executive Board
page 53
C.2.2.2.
Length:
>>
10 Years
SECTION D. Environmental impacts
>>
D.1.
Documentation on the analysis of the environmental impacts, including transboundary
impacts:
>>
The Environmental Impact Assessment Notification of 2006 [14/09/2006] lists projects that require
environmental clearance and captive power projects of the size of the present project within an industrial
plant do not fall within it. However there are standard requirements for the operation of captive boilers
with respect to air emissions control and stack height that have been included as a part of regulatory
requirements in the project design.
As the project substitutes coal combustion it has positive environmental impacts such as:1. Avoids CO2 emission from coal combustion
2. Reduces methane emissions by avoiding natural decay of the biomass residues to be used in
project
3. Project technology would enable better combustion of fuel thus leading to less ash generation and
avoidance of solid waste
4. ITC would set up a biomass handling and preparation plant which will lead to generation of
additional source of work opportunities and income in the region.
In addition to GHG abatement, the biomass boiler is likely to reduce SOx and NOx emissions to some
degree. The project boiler is designed based on Atmospheric Fluidized Based Technology. One of the
major features of this technology is that it has reduced furnace due to better fuel mix and higher heat
transfer rate. Due to lower furnace temperature formation of NOx will be less. Another important feature
of the technology is that it reduces formation of SOx .Hence this boiler technology reduces the adverse
impact of NOx and Sox to the environment. The fact can be substantiated from publicly available
literature on AFBC technology.
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:
>>
There will be no significant adverse environment impact due to this project activity
SECTION E. Stakeholders comments

>>
E.1.
Brief description how comments by local stakeholders have been invited and compiled:
>>
Stakeholder consultation meeting was conducted on 3rd September 2008 at Bhadrachalam to understand
and record the concern of the stakeholders to this proposed CDM project. The stakeholders appreciated

CDM Executive Board
page 54
and thanked the ITC PSPD management for taking up such project activity which will not only improve
the local environment through reduced pollution but also socio-economically benefit the society.
E.2.
Summary of the comments received:
>>
The summary of the comments received are as follows:
Q1) Mr. P V Srinivasa Rao, Sr.Manager, asked about what types of biomass are envisaged for the
boiler as fuels.
Q2) Mr Krishna Rao, Sr.Manager from Engineering Services ,asked about the benefits of
installing a green boiler
Q3) Mr Marram Venkateshwar Rao, Union leader, asked how employees and farmers were going
to benefit from the project.
Q4) Mr Srinivas Rao of Pulp Mill asked how the biomass would be handled to feed to the boiler
on continuous basis.
Q5) Mr Laxmi Narayanan, of Finance department asked whether any company had boiler
operating on similar fuels and how the risk of not able to operate is addressed.
Please refer to the detail minutes of the meeting in Annex 6
E.3.
Report on how due account was taken of any comments received:
>>
The comments discussed in section E 2 were addressed in the following manner:
Q1) It was explained that boiler is designed for utilization of majorly wood bark as debarked wood is
utilized for pulping purpose. Along with bark, chipper dust, lops & tops will be utilized as regular fuel.
Also, boiler was designed to use rice husk, cotton stalk and chilli stalk. As the plant is surrounded with
agricultural fields, it was proposed to explore availability of similar types of biomass for utilization. It
was explained that company is envisaged for 1,00,000 hectares of plantation by 2010 as part of corporate
vision, which will give sustainability of fiber and plantation biomass for the boiler.
Q2) It was explained that installation of Green boiler will reduce the coal consumption, reduce CO2
emission, improve steam generation efficiency as old medium and low pressure boilers retained as
standby will be phased out, reduce maintenance cost as number of boilers installed is reduced.
Q3) It was explained that farmers will be paid on market rate in procurement of biomass which otherwise
has no value to the farmer.Hence project is beneficial for farmers. For the employees the hassle of doing
regular maintenance work and handling of coal will reduce. This will also lead to reduction in work place
pollution from coal dust.
Q4) Dr. Kulkarni explained that unit proposed to install biomass preparation plant where bark, lops &
tops from plantation fields will be processed through suitable chippers and other biomass like chipper
dust & other biomass from agricultural fields like rice husk etc will be conveyed directly as it does not
need processing.
Q5) Dr. Kulkarni explained that boilers on biomass like rice husk, cotton stalk, Chilli stalk, Saw dust,
wood residues are operating in many Industries. Also, in abroad where large pulp mills are operated,
biomass boiler is invariably installed to utilize the generated biomass to use as fuel and to address the
solid waste generation. In our case major source of biomass is sourced from plantation.
The members were satisfied with the answers.
Please refer to the detail minutes of the meeting in Annex 6

CDM Executive Board
page 55
Annex 1
CONTACT INFORMATION ON PARTICIPANTS IN THE PROJECT ACTIVITY
Organization:
Street/P.O.Box:
Building:
City:
State/Region:
Postcode/ZIP:
Country:
Telephone:
FAX:
E-Mail:
URL:
Represented by:
Title:
Salutation:
Last name:
Middle name:
First name:
Department:
Mobile:
Direct FAX:
Direct tel:
Personal e-mail:
ITC Paperboards & Specialty Papers Division (PSPD)

106 Sardar Patel Road
Secunderabad
Andhra Pradesh
Secunderabad-500003
India
91 40 27846561/62
91 40 27811954
Mr.
Divsional Chief Executive
Dhobale
Pradeep
Paperboards & Specialty Papers Division,Unit-Bhadrachalam
Pradeep.Dhobale@itc.in

CDM Executive Board
page 56
Annex 2
INFORMATION REGARDING PUBLIC FUNDING
No public funding has been sought for the project activity. The project proponent will identify potential
participants if additional funds are required in the future.

CDM Executive Board
page 57
Annex 3
BASELINE INFORMATION
Refer to section B

CDM Executive Board
page 58
Annex 4
MONITORING INFORMATION
Refer to section B

CDM Executive Board
page 59
Annex 5
Project location

CDM Executive Board
page 60
----

CDM Executive Board
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Annex 6
The summary of stakeholder meeting was on 3rd September 2008.
The meeting commenced at 5 PM at Mill canteen premises. Nearly, 30 members attended
the meeting (Employees, Union Leaders, Contract Workmen, Contractors,
Pricewaterhousecoopers Consultants, Local villagers and Managers). The members
elected Mr A V Rao, Vice President (Projects) as the chairman.
Dr. HD Kulkarni requested Mr A V Rao, Vice President (Projects), Mr VSS Kannababu,
General Manager (Production), A Das Dy. General Manager Technical, and Mr M
venkateshwar Rao President of recognized Union to occupy the dias. Mr A V Rao, Vice
President presided over the meeting.
Dr. HD Kulkarni explained about the green house gas effect and its impact on people and
explained about the benefits Indian Industry can avail by actively participating in
reduction of GHG emissions under Kyoto protocol. Dr. Kulkarni explained about the
opportunities which exist through sequestration through plantation and energy efficiency
measures for Indian pulp & paper Industry.Dr Kulkarni explained about companys
plantation program envisaged for self sufficiency in fiber and beyond. It was explained
about the felling cycle of plantation and the effective wood availability and the balance
biomass which are left over in the fields as they were not required for mill.
Mr A V Rao described about the proposed project of installation of AFBC boiler
designed to maximize the utilization of plantation biomass and other agricultural biomass
available surrounding the plant. He described the boiler designed for firing biomass along
with coal and also to fire 100% biomass.
Mr S Venkat Rao, Chief Manager Utilities, explained about the coal savings that can be
achieved and reduction in fly ash handling through the Green boiler. It wasexplained how
another equivalent capacity coal fired boiler which is commissioned in 2004 will be
stopped and retained as standby boiler and scrapping of all old boilers which will
improve the overall efficiency of steam generation and reducing coal consumption. Mr
VSS Kannababu, General Manager (Production) explained about the need to identify new
opportunities in the areas of energy conservation to reduce the consumption of fossil
fuels in manufacturing pulp & paperboards to reduce CO2 emissions. He encouraged the
participants to come forward with suggestions which will reduce energy consumption as
it contributes to reduce CO2 emissions. Mr Kanna Babu stressed the need to practice
conservation of natural resources like water, electricity, fiber, cooking gas etc in daily life
to become as culture within the plant and at home.
Dr. HD Kulkarni informed the stakeholders that under Clean Development Mechanism,
ITC PSPD Bhadrachalam unit is proposing Green Boiler project for GHG mitigation.
After the informative session the Chairman encouraged the participants to ask question
and share there own experience in reducing energy consumption and pollution. The
discussions were conducted in the local language Telugu and English which are listed
below.

CDM Executive Board
page 62
Mr. P V Srinivasa Rao, Sr.Manager asked about what types of biomass is envisaged for
the boiler as fuel It was explained that boiler is designed for utilization of majorly wood
bark as debarked wood is utilized for pulping purpose. Along with bark, chipper dust,
lops & tops will be utilized as regular fuel. Also, boiler was designed to use rice husk,
cotton stalk and chilli stalk. As the plant is surrounded with agricultural fields, it was
proposed to explore availability of similar types of biomass for utilization. It was
explained that company is envisaged for 1, 00, 000 hectares of plantation by 2010 as part
of corporate vision, which will give sustainability of fiber and plantation biomass for the
boiler.
Mr Krishna Rao, Sr.Manager from Engineering Services asked what benefits of installing
the green boiler are?.
It was explained that installation of Green boiler will reduce the coal consumption,
reduce CO2 emission, improve steam generation efficiency as old medium and low
pressure boilers retained as standby will be phased out, reduce maintenance cost as
number of boilers installed is reduced.
Mr Marram Venkateshwar Rao, Union leader asked how employees and farmers are
going to benefit from the project. It was explained that farmers will be paid on market
rate in procurement of biomass which otherwise has no value to the farmer. Hence
project is beneficial for farmers. For the employees the hassle of doing regular
maintenance work and handling of coal will reduce. This will also lead to reduction in
work place pollution from coal dust.
Mr Srinivas Rao Pulp Mill asked how the biomass will be handled to feed to the boiler on
continuous basis.
Dr. Kulkarni explained that unit proposed to install biomass preparation plant where
bark, lops & tops from plantation fields will be processed through suitable chippers and
other biomass like chipper dust & other biomass from agricultural fields like rice husk etc
will be conveyed directly as it does not need processing.
Mr Laxmi Narayanan, Finance asked whether any company has boiler operating similar
fuels and how the risk of not able to operate is addressed.
Dr. Kulkarni explained that boilers on biomass like rice husk, cotton stalk, Chilli stalk,
Saw dust, wood residues are operating in many Industries. Also, in abroad where large
pulp mills are operated, biomass boiler is invariably installed to utilize the generated
biomass to use as fuel and to address the solid waste generation. In our case major source
of biomass is sourced from plantation.
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3890 - ITC Green Boiler PDD - RFR - Final - Clean

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PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

CDM Executive Board

CLEAN DEVELOPMENT MECHANISM

General description of project activity

Application of a baseline and monitoring methodology

Duration of the project activity / crediting period

Annex 1: Contact information on participants in the project activity

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

SECTION A. General description of project activity

Title of the project activity:

Description of the project activity:

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

CER calculation excel sheet

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

Table2: Installed Capacity of Turbines:

Rated Capacity (MW)

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

The project activity contributes to sustainable development in terms of environmental, socio-economic

Name of Party involved (*)

Private and/or public

Kindly indicate if the Party

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

Technical description of the project activity:

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

Annual estimation of emission reductions in

*The start date of the crediting period is tentatively 01/07/2011

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

heat generation equipment is referred to as unit.)

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

boilers for heat

Excluded Excluded for simplification. This is conservative.

Excluded It is assumed that CO2 emission fro surplus

On-site fossil fuel

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

Avoided CH4 emission

CO2 EMISSION FROM OFF SITE

Heat from Boiler

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

Step 3: Investment analysis

Refer point 19 of http://220.227.161.86/eac/eacfinal/vol25/13.htm

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

100% coal fired

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

Civil and mechanical cost for biomass

Avant Garde TEFR, PSPD note to CMC for

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

Coal Price-INR 868.45/tonne

Increase in variable cost-6%

Avant Garde TEFR

PROJECT DESIGN DOCUMENT FORM (CDM PDD) - Version 03

NCV of biomass-3650 kCal/kg

Companys Act , India

Green Boiler Efficiency-80%