Verification Report. Esivere and Virtsu II

Transcription

1 Verification Report Esivere and Virtsu II Initial and First Periodic Verification of the JI project Esivere and Virtsu II Windpower Development in Estonia Report No , rev. 0 November 10, 2008 TÜV SÜD Industrie Service GmbH Carbon Management Service Westendstr Munich - GERMANY

2 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Report No. Date of first issue Version Date of this revision Certificate No November 10, Subject: Initial and first Periodic Verification of a JI Project Executing Operational Unit: TÜV SÜD Industrie Service GmbH Carbon Management Service Westendstr Munich, GERMANY Client: Contract approved by: Report Title: Number of pages OÜ Nelja Energia Mr. Martin Kruus Estonia pst 1/3 - Tallinn Estonia Javier Castro Initial and First Periodic Verification of the Esivere and Virtsu II 22 (excluding cover page and annexes) Summary: The certification body Climate and Energy of TÜV SÜD Industrie Service GmbH has been ordered by OÜ Nelja Energia to carry out the initial and the first periodic verification of the Esivere and Virtsu II Windpower Development JI Project in Estonia. The verification team confirms that the project is implemented as planned and described in validated project design documents. Installed equipment being essential for generating emission reduction runs reliably and is calibrated appropriately. The monitoring system is in place and the project is generates GHG emission reductions. The underlying emission reduction report covers the monitored period from to The verification team confirms that the GHG emission reduction for the whole monitoring period is calculated without material misstatements. Our opinion relates to the project s GHG emissions and resulting GHG emissions reductions reported and related to the valid and registered project baseline and monitoring, and its associated documents. Based on the information we have seen and evaluated, we confirm the following statement: Reporting period: from October 01, 2005 to December 31, Verified emission in the above reporting period: Baseline Emissions: t CO2 Project Emissions : 0 t CO2 Emission Reductions: t CO2 The verification team also determined some few areas of risks for the project in the context of the monitoring system and environmental surveillance. Issues indicated as Forward Action Request should be submitted as indispensable information to the verification team of the next periodic verification. Work carried out by: Klaus Nürnberger (project manager) (GHG auditor, Local expert) Internal Quality Control by: Javier Castro

3 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Abbreviations Abbreviations that have been used in the report here: AAU BLS CAR CO2 ERU FAR GHG IETA IVC JI KP MOS MP MVP PDD PTP PVC TÜV SÜD UNFCCC VVM Assigned Amount Unit Baseline Study Corrective Action Request Carbon Dioxide Emission Reduction Unit Forward Action Request Greenhouse Gas International Emission Trading Association Initial Verification Checklist Joint Implementation Kyoto Protocol Management and Operational System Monitoring Plan Monitoring and Verification Protocol Project Design Document OÜ Pakri Tuulepark Periodical Verification Checklist TÜV SÜD Industrie Service GmbH UN Framework Convention on Climate Change Validation and Verification Manual

4 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Table of Contents 1 INTRODUCTION Objective Scope GHG Project Description METHODOLOGY Review of Documentation and Site Visits Resolution of Corrective and Forward Action Requests INITIAL VERIFICATION FINDINGS Remaining issues, CARs, FARs from determination Project Implementation Internal and External data Environmental and Social Indicators Management and Operational System Completeness of Monitoring Accuracy of Emission Reduction Calculations Quality of Evidence to Determine Emission Reductions Management System and Quality Assurance PROJECT SCORECARD VERIFICATION STATEMENT REFERENCES Annex 1: Initial Verification Checklist Annex 2: Periodic Verification Checklist

5 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 1 INTRODUCTION Martin Kruus, managing director of Nelja Energia, the operator of the Esivere and Virtsu II wind parks has commissioned the certification body Climate and Energy of TÜV SÜD Industrie Service GmbH to verify the Esivere and Virtsu II Windpower Development Project in Estonia. The order includes the initial and first periodic verification of the project. This report summarizes the findings of the initial and first periodic verification. It is based on the Initial Verification Report Template Version 3.0, December 2003 and on the Periodic Verification Report Template Version 3.0, December 2003, both part of the Validation and Verification Manual (VVM) published by International Emission Trading Association (IETA). Initial and first periodic verification has been performed as one integrated activity. It consisted of a desk review of the project documents including baseline study, monitoring plan, determination (validation) report, emission reduction report and further documentations. The results of the final determination were documented by TÜV SÜD Industrie Service GmbH in the Final Determination Report: Determination of the Esivere and Virtsu II Wind Power Developments JI-Project, Estonia, report no , dated This final determination report indicates no remaining CAR s, FAR s or CR s. There was indicated only one outstanding issue - a formal, written Letter of Approval of Estonian Government should be provided. It is solved by now the Letter of Approval is issued by the Ministry of Environment on the 28. of December Specific national guidelines and procedures for JI projects in Estonia exist since April 2008, but only in draft version. First periodic verification is conducted for the period between and The periodic verification consisted of a desk review of the project documents and onsite-visit. The verification team consists of the following personnel: Klaus Nürnberger TÜV SÜD, Munich Project Manager, Team Leader OÜ Ekoekspert, Tallinn GHG Auditor, Local Expert Andre Starick TÜV SÜD, Munich Member of Sales Team, Assistant in Communication and Coordination 1.1 Objective The operator of the wind park, OÜ Nelja Energia, on behalf the project owner, Roheline Ring Tuulepargid OÜ, has commissioned an independent initial / first periodic verification of the Esivere and Virtsu II Windpower Development JI Project by TÜV SÜD. The objective of verification can be divided in Initial Verification and Periodic Verification: Initial Verification: The objective of an initial verification is to verify that the project is implemented as planned, to confirm that the monitoring system is in place and fully functional, and to assure that the project will generate verifiable emission reductions. A separate initial verification prior to the project entering into regular operations is not a mandatory requirement.

6 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Periodic Verification: The objective of the periodic verification is to verify and confirm that: o actual monitoring systems and procedures are in compliance with the monitoring systems and procedures described in the monitoring plan; o the project has achieved the ERs claim for the verification period in compliance with the methodology laid down in the monitoring plan; o the GHG emission reduction data and express a conclusion with a high, but not absolute, level of assurance about whether the reported GHG emission reduction data is free of material misstatements; o the claimed ERs are real and additional to any that would have occurred in the baseline scenario as interpreted and developed in the baseline study (as part of the PDD) for Esivere and Virtsu II Windpower Development JI Project; o verifies that the reported GHG emission data is sufficiently supported by evidence, i.e. monitoring records; o the operation of the project continues to be in compliance with all Kyoto Protocol and modalities for JI projects. The verification shall consider both quantitative and qualitative information on emission reductions. Quantitative data comprises the monitoring reports submitted to the verifier by the project entity. Qualitative data comprises information on internal management controls, calculation procedures, and procedures for transfer, frequency of emissions reports, review and internal audit of calculations/data transfers. 1.2 Scope This report is based on JI rules established and published by JI-Supervisory Committee as well as requirements arising from CDM methodologies as far as such are applied in the project and rules valid for both CDM and JI. Furthermore all requirements arising from the Kyoto-Protocol and the Marrakesh accords are taken into account in this report. Further on the relevant criteria for this project are given the validated PDD including the Monitoring Plan. Verification scope is defined as an independent and objective review and ex post determination of the monitored reductions in GHG emissions. The verification is based on the submitted monitoring report, the validated project design documents including its monitoring plan. The verification also focuses on the implementation of the project as well, including all quality aspects of the monitoring activities. TÜV SÜD has, based on the recommendations in the Validation and Verification Manual, employed a risk-based approach in the verification, focusing on the identification of significant risks of the project implementation and the generation of verifiable Emission Reduction Units (ERUs) during Thus a consecutive verification is covered by scopes, as it is assessing: auditing regarding to the implementation of all recommendations of the last validation/determination protocol

7 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist all weaknesses and strengths of the applied management procedures the consistency, accuracy of data acquisition, data processing and transparent reporting the eligibility of monitoring processes and equipment and its calibration The verification is not meant to provide any consulting towards the client. However, stated requests for clarifications and/or corrective actions may provide input for improvement of the monitoring activities. On 24. March 2008 TÜV SÜD received the first version of the Monitoring Report (version 1.0). In order to get the Monitoring Report published some adjustments were carried out. The version 2.0 from 12. May 2008 was published. After desk review the audit team has been provided with a Monitoring Report and underlying data records on June 11, 2008 (Monitoring Report Version May 2008 with annexes), covering the period October 2005 to December This document serves as the basis for the assessment presented herewith. Studying the existing documentation belonging to this project, it was obvious that the competence and capability of the audit team performing the verification has to cover at least the following aspects: Knowledge of Kyoto Protocol and the Marrakech Accords Environmental and Social Impact Assessment Skills in environmental auditing (ISO 14000, EMAS) Quality assurance Technical aspects of wind energy Monitoring technologies and concepts Political, economical and technical conditions in host country According to these requirements TÜV SÜD has composed a project team in accordance with the appointment rules of the TÜV SÜD certification body climate and energy : Responsibility for the internal quality control of the project was Javier Castro, head of the certification body climate and energy. 1.3 GHG Project Description The main feature of the project is the energy production by wind turbines substituting electricity produced by mostly oil-shale fired power plants. The project is located in Hanila Municipality, about 140 km west from Tallinn, the capital of Estonia. The location is suitable for wind power due to its wind conditions and also from an environmental point of view. The project itself is bundled by his nature, consisting two separate wind parks: - Esivere Wind Park, consisting 4 Enercon E kw wind turbines, started to operate in October 2005; - Virtsu II, consisting 3 Enercon E70 E kw wind turbines, started to operate in April 2008.

8 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist All wind turbines are connected to the Estonian main grid, operated by the electrical utility Eesti Energia AS. At the time of the verification the Esivere Wind Park was fully operational. Virtsu II wind farm commissioning has been delayed due to the delays with reconstruction of grid connection point by national utility Eesti Energia. The trial production of the wind farm was started in April 2008, the produced wind energy was supplied to the grid. It is expected that the local municipality will issue the official user permit in the end of summer Involved project participants were: Martin Kruus, chairman of the Board of Nelja Energia, and also management board member of OÜ Roheline Ring Tuulepargid (RRT) Raimo Pirksaar, production manager of Nelja Energia Hannu Lamp, LHCarbon OÜ, consultant to Nelja Energia 2 METHODOLOGY The project assessment aims at being a risk based approach and is based on the methodology developed in the Validation and Verification Manual (for further information see an initiative of all Applicant Entities, which aims to harmonize the approach and quality of all such assessments. Based on the received documents (see article 6) a verification checklist (VC) has been prepared, consisting of the Initial Verification Checklist (IVC) and the Periodic Verification Checklist (PVC) according to the VVM. In order to ensure transparency, a verification protocol (checklist) was customized for the project, according to the Validation and Verification Manual. The protocol shows, in a transparent manner, criteria (requirements), means of verification and the results. The verification protocol serves the following purposes. These combined checklists serve the following purposes: - it organizes details of the audit procedure and clarifies the requirements a CDM/JI project is expected to meet; and - It ensures a transparent verification process where the verifier will document how a particular requirement has been proved and the result of the verification. During the verification a special focus was given to: - the correct implementation of the project (installations, monitoring equipment and procedures, quality assurance procedures) - the correctness of assumptions with impacts on the monitoring and verification process (e.g. baseline assumptions) - sustainable development and environmental performance parameters - training programs - allocation of responsibilities - the day-to-day operation of the system

9 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist After the document review the audit team conducted - an on-site inspection at the wind farm - interviews with the members of Nelja Energia and the consultant LHCarbon OÜ in Tallinn The findings are the essential part of this verification report, which is based on the verification protocols of the VVM. Those protocols consist of four tables one from the IVC, three from the PVC. The completed protocols (checklists) are enclosed in Annex 1 and Annex 2 to this report. The structure of the tables is shown in the following: Initial Verification Checklist table 1 OBJECTIVE Ref. COMMENTS Concl.(incl FARs/CARs) The requirements the project must meet. Gives reference to the legislation or agreement where the requirement is found. Description of circumstances and further conclusions. This is either acceptable based on evidence provided (OK), or a Corrective Action Request (CAR) of risk or non-compliance with stated requirements. The corrective action requests are numbered and presented to the client in the Verification report. Forward Action Requests (FARs) indicate essential risks for further periodic verifications Periodic Verification Checklist Table 1: Data Management System/Controls Expectations for GHG data management system/controls The project operator s data management system/controls are assessed to identify reporting risks and to assess the data management system s/control s ability to mitigate reporting risks. The GHG data management system/controls are assessed against the expectations detailed in the table. Score A score is assigned as follows: Full all best-practice expectations are implemented. Partial a proportion of the best practice expectations is implemented Limited this should be given if little or none of the system component is in place. Verifiers Comments (including Forward Action Requests) Description of circumstances and further commendation to the conclusion. This is either acceptable based on evidence provided (OK), or a Corrective Action Request (CAR) of risk or noncompliance with stated requirements. The corrective action requests are numbered and presented to the client in the Verification report. The Initial Verification has additional Forward Action Requests (FAR). FAR indicates essential risks for further periodic verifications Periodic Verification Checklist Table 2: GHG calculation procedures and management control testing

10 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Identification of potential reporting risk Identification of potential reporting risks based on an assessment of the emission estimation procedures. Identification of key source data. Focus on those risks that impact the accuracy, completeness and consistency of the reported data. Identification, assessment and testing of management controls Identification of the key controls for each area with potential reporting risks. Assessment of adequacy of the key controls and eventually test that the key controls are actually in operation. Internal controls include, Understanding of responsibilities and roles, Reporting, reviewing and formal management approval of data; Procedures for ensuring data completeness, conformance with reporting guidelines, maintenance of data trails etc. Areas of residual risks Identification of areas of residual risks, i.e. areas of potential reporting risks where there are no adequate management controls to mitigate potential reporting risks Areas where data accuracy, completeness and consistency could be improved are highlighted. Periodic Verification Checklist Table 3: Detailed audit testing of residual risk areas and random testing Areas of residual risks List of residual areas of risks of Periodic Verification Checklist Table 2 where detailed audit testing is necessary. In addition, other material areas may be selected for detailed audit testing. Additional verification testing performed The additional verification testing performed is described. Testing may include: Sample cross checking of manual transfers of data Recalculation Spreadsheet walk throughs to check links and equations Inspection of calibration and maintenance records for key equipment Check sampling analysis results Discussions with process engineers who have detailed knowledge of process uncertainty/error bands. Conclusions and Areas Requiring Improvement (including FARs) Having investigated the residual risks, the conclusions are noted here. Errors and uncertainties are highlighted. CARs were not encountered during the verification process. However, the verification team has defined FARs, whenever - the current status requires a special focus on this item for the next consecutive verification, or

11 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist - an adjustment of the MVP is recommended. All FARs have to be reported to the verification team of the next Periodic Verification, which has to take into account all such findings. Duration of the verification Pre-Check of PDD for GSP: from March 24 to 12. May 2008 Desk-Review and Preparations: from June 11 to June 25, 2006 On-site verification: June 26, 2008 On-site clarifications: June 26, 2008 (in the Nelja Energia office) Emission Reduction Reporting Period: From October 01, 2005 to December 31, Review of Documentation and Site Visits The verification was performed as a desk review of the project documents including baseline study, monitoring plan, determination (validaqwtion) report, existing emission reduction report and further documentations. The results of the final determination were documented by TÜV SÜD Industrie Service GmbH in the Final Determination Report: Determination of the Esivere and Virtsu II Winf Power Developments JI-Project, Estonia, report no , dated This final determination report indicates no remaining CAR s, FAR s or CR s. There was indicated only one outstanding issue - a formal, written Letter of Approval of Estonian Government should be provided. It is solved by now the Letter of Approval is issued by the Ministry of Environment on the 28. of December Specific national guidelines and procedures for JI projects in Estonia exist since April 2008, but only in a draft version. The Monitoring Report (Ver. 3.1, May 30, 2008) was submitted to TÜV SÜD by LHCarbon OÜ in June The Monitoring Report was also published on the TÜV SÜD website Site visit included an on-site inspection at the wind farms, sub-stations of Main Grid, interviews with the members of Nelja Energia and the consultant LHCarbon in Tallinn. A complete list of all reviewed documents is available in article 6 (References) of this report. The main topics of the interview are summarized in Table 1. Table 1 Interview topics Interviewed persons Interview topics

12 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Mr. Raimo Pirksaar, Production Manager of Nelja Energia OÜ Mr. Hannu Lamp LHCarbon OÜ, consultant to Nelja Energia OÜ Actual status of installation works (including measuring equipment in Main Grid sub-stations) Technical equipment and operation Monitoring plan Data collection, analysis, monitoring, storing Data uncertainty and residual risks Plausibility checks, double control system GHG calculation Compliance with national laws and regulations Environmental and social impacts Management and operational system 2.2 Resolution of Corrective and Forward Action Requests The objective of this phase of the verification was to resolve the requests for corrective actions and any other outstanding issues which needed to be clarified for TÜV SÜD`s positive conclusion on the GHG emission reduction calculation. No CARs have been identified during the initial and 1 st periodic verification. 3 Forward Action Requests have been defined for issues which do not effect the generation of emission reduction in the verified period, but shall be improved in order to ensure the reliability of future data and to avoid any major risk. To guarantee the transparency of the verification process, the FARs raised and responses that have been given are summarized in chapter 3 below and documented in more detail in the verification protocols in annex 1 and 2.

13 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 3 INITIAL VERIFICATION FINDINGS In the following sections the findings of the verification are stated. The verification findings for each verification subject are presented as follows: The findings from the desk review of the final monitoring report and the findings from interviews during the follow up visit are summarized. A more detailed record of these findings can be found in the Initial Verification Protocol (Checklist) in annex 1. 1) Where TÜV SÜD had identified issues that needed clarification or that represented a risk to the fulfilment of the project objectives, a Corrective or Forward Action Request, respectively, have been issued. The Corrective and Forward Action Requests are stated, where applicable, in the following sections and are further documented in the Verification Protocols in the annex. The verification of the project resulted in 3 Forward Action Requests. No Corrective Action Requests were raised. 2) In the context of Forward Action Requests, risks have been identified, which may endanger the delivery of high quality CERs in the future, i.e. by deviations from standard procedures as defined by the MP. As a consequence, such aspects should receive a special focus during the next consecutive verification. A FAR may originate from lack of data sustaining claimed emission reductions. Forward Action Requests are understood as recommendation for future project monitoring; they are stated, where applicable, in the following sections and are further documented in the Verification Protocols (Checklists) in annex 1 and 2. 3) The final conclusions for verification subject are presented. The verification findings relate to the project implementation as documented and described in the final monitoring report. 3.1 Remaining issues, CARs, FARs from determination One task of verification is to check the remaining issues from the previous validation or issues which are clearly defined for assessment in the PDD. The final determination report ( Determination of the Esivere and Virtsu II Winf Power Developments JI-Project, Estonia, report no , dated ) indicates no remaining CAR s, FAR s or CR s. There was indicated only one outstanding issue - a formal, written Letter of Approval of Estonian Government should be provided. It is solved by now the Letter of Approval is issued by the Ministry of Environment on the 28. of December Specific national guidelines and procedures for JI projects in Estonia exist since April 2008, but only in a draft version.

14 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 3.2 Project Implementation Discussion The scrutiny of a proper implementation of a project is a key issue of an Initial Verification, in order to have a climate change project ready for successful operation. The project itself is bundled by his nature, consisting two separate wind parks: - Esivere Wind Park, started to operate in October 2005; - Virtsu II wind farm commissioning has been delayed due to the delays with reconstruction of grid connection point by national utility Eesti Energia. The trial production of the wind farm was started in April 2008, the produced wind energy was supplied to the grid. It is expected that the local municipality will issue the official user permit in the end of summer The main contractor for both lots was Enercon, the manufacturer of the wind turbines. All wind turbines are connected to the Estonian main grid, operated by the electrical utility Eesti Energia AS. Esivere Wind Park is connected with Rõuste main grid 110 kv sub-station, Virtsu II is connected with Virtsu main grid 110 kv sub-station. Both sub-station have been constructed/rehabilitated by Eesti Energia. All details of the wind park were checked. Esivere wind park covers the 4 turbines (Enercon E kw), the cabin with the electrical and control equipment, 35-kV-transformer, main grid meter. Virtsu II wind park covers the 3 turbines (Enercon E kw), the cabin with the electrical and control equipment, 35-kV-transformer, main grid meter. All required metering systems have been identified and checked. The following meters are relevant for the calculation of emission reductions; they are all on the premises of the Eesti Energia 110 kv sub-stations: - Esivere wind park has main grid meter (35 kv) in Rõuste sub-station, which belongs to Eesti Energia. Main grid power meter Landis+Gyr ZDM405CT No , accuracy class 0,5, the testing label (calibration sticker) AE (June, 2005) is placed. The meter is within its first calibration period. The meter complies with the appropriate standards. - Virtsu II wind park has main grid meter (35 kv) in Virtsu sub-station, which belong to Eesti Energia. Main grid power meter Landis+Gyr ZDM405CT No , accuracy class 0,5, the testing label (calibration sticker) AE (June, 2007) is placed. The meter is within its first calibration period. The meter complies with the appropriate standards. Both main grid meters are 2-direction meters, measuring power supplied from the wind park and to the wind park. All turbines have their own power meters NZR 3x230/400Vg, belonging to the wind park and which are connected to the Enercon SCADA system. The project boundaries have not been changed. The Monitoring Plan (MP) defines the responsibilities to consolidate the data required for emission reduction calculations. Calculations are simple and restricted to entering monthly the production data into a predefined Excel spreadsheet.

15 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist The following parameters need to be obtained according to the monitoring plan: Electricity production (20 kv, continuous direct measurement) Electricity consumption from main grid (20 kv, continuous direct measurement) Production data from Enercon SCADA systems for plausibility checks Findings The verifier identified following findings (see also Initial and 1 st Periodic Verification Checklists in annex 1 and 2). OBJECTIVE COMMENTS Concl. Documentation of management and operational systems (IVC C.3) The Virtsu sub-station had to be extended/ rehabilitated as it is planned to construct the connection point also for Virtsu III wind park in the same Virtsu sub-station. Virtsu III wind park is under the development at the moment. For Virtsu II and III wind parks is constructed separate sub-station near to Eesti Energia s Virtsu substation. Connection point for both (Virtsu II and Virtsu III) windparks is common and it is located in Main Grid 110 kv side. In Windpark sub-station have both wind park separate measuring equipment in 20 kv side. It is expected, that Virtsu III wind park will start operation in spring Forward Action Request #1: The developer should ensure that Virtsu III wind farm, which is connected to the same substation, will have an own connection on 35 kv level and separate measuring system in order to separate the power generation from both wind parks the existing Virtsu II and the planned Virtsu III. FAR# Conclusion The project complies with the requirements, assuming appropriate handling of FAR #1 in the ongoing verification period. 3.3 Internal and External data Discussion The following parameters need to be obtained according to the monitoring plan: Electricity production (continuous direct measurement) Electricity consumption from main grid (continuous direct measurement)

16 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Production data from Enercon SCADA systems for plausibility checks Even if the source of the electricity generation and the sink of the electricity demand is internal, the relevant meters are external (owned, maintained and read by Eesti Energia subsidiaries). Insofar they will be considered as external data. The only internal data set is the electricity generation metered by the Enercon Scada systems. This is used as backup source in case of a failure of the Main Grid meters. The production data are delivered by Eesti Energia on a monthly basis. The meters are in the Virtsu and Rõuste substations, under control of Eesti Energia. Both main grid meters are 2- direction meters, measuring power supplied from the wind park and to the wind park. The production data delivered by Eesti Energia are checked on a monthly basis against the respective Scada data. Any deviations can therefore be discovered immediately. In case of any problems with the Main Grid 110 kv meter itself or the lines to the connection points the data of the Enercon SCADA system can be used. As SCADA measures the production at the turbines, it gives slightly higher production values compared to the measuring meter values in Grid Connection Point (GCP). The difference is due to the losses in the grid between turbine and GCP and own consumption in wind park. There are two Enercon Scada systems one for Esivere and second for Virtsu II. Scada data are stored in the central Scada servers in the Rõuste (for Esivere) and Virtsu (for Virtsu II) 35/110 kv distribution stations. At the same time they are continuously transferred to the Enercon dispatch centre in Germany. The system is allowing obtaining data through communication and telephone network and therefore the operator has direct access to those data at any time and any place. In case measuring meters in Main Grid are not functioning, the electricity production data as indicated with SCADA system (minus estimated grid losses) will be used to calculate achieved emission reductions. According to the actual data during , the average grid losses have been calculated to be 1,7-1,95%. It is considered to be sufficient to deduct 2% from the Enercon SCADA electricity production figure in order to obtain the electricity production at GCP during periods of measuring meters failure. Up to now there was no malfunctioning of the power meter; therefore this backup rule has not yet been applied Findings The verifier identified following findings (see also Initial and 1 st Periodic Verification Checklists in annex 1 and 2). OBJECTIVE COMMENTS Concl. Troubleshooting procedures (IVC C.11) According to the latest Monitoring Plan (Ver. 1.0 May ) an internal double control system is implemented to avoid problems resulting from malfunctioning of Main Grid remote-control data acquisition system. Forward Action Request #2: Additional internal double control system shall be implemented as stated in the existing Monitoring Plan - the Main Grid production data have to be cross-checked with the readings of power meters. FAR#2

17 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist OBJECTIVE COMMENTS Concl Conclusion According to the agreement between 4Energia and Main Grid the power meter values have to be written down at least three times a year. Even more they should be written down always at the end of the next monitoring period. The project complies with the requirements, assuming appropriate handling of FAR #2 in the ongoing verification period. 3.4 Environmental and Social Indicators Discussion A full-scale Environmental Impact Assessment (EIA) has been carried out for both Esivere and Virtsu II projects in The EIA reports have been approved by Lääne County Regional Environmental Department which is a competent authority responsible for performing the duties of environmental supervision and post-project monitoring Findings The verifier identified following findings (see also Initial and 1 st Periodic Verification Checklists in annex 1 and 2). OBJECTIVE COMMENTS Concl. Environmental and social indicators (IVC F) For Esivere wind park the Lääne County Environmental Department have recommended an ongoing bird surveillance for 3 years prior to and starting from the operation of wind park. For Virtsu II wind park the bird surveillance is obligatory for 2 years after starting the operation of wind park. FAR#3 Forward Action Request #3: The results of bird surveillance shall be presented in written document (report) Conclusion The project complies with the requirements, assuming appropriate handling of FAR #3 in the ongoing verification period.

18 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 3.5 Management and Operational System Discussion The management and operational system (MOS) is documented in the MP Monitoring plan of Esivere and Virtsu II Wind Power JI Project, version 1.0, May 30, It is the basic document to manage and operate the wind park and to produce the ER reports. The Monitoring Plan provides all required details on qualifications. Due to the limited number of the involved people and their direct participation in the development of the MOS, the personnel has appropriate competences, capabilities and qualifications. Data storing is explicitly mentioned in the MP. Production data history is stored electronically as received from Main Grid and also as printouts as described above. Data is also stored in: 1) Main Grid, as an owner of measuring meters, 2) Main Grid/EE in form of electricity sale invoices issued by Roheline Ring Tuulepargid OÜ, 3) RRT bookkeeping as issuer of electricity sale invoices, 4) Enercon SCADA RRT (Roheline Ring Tuulepargid) and Nelja Energia also create regular backups of the computer hard drives. All records are maintained in paper and electronic form until the end of 2014 for verification. Monitoring and verification reports will be archived together with electricity production reports. Responsible person at RRT for handling the electricity production data and compilation of monitoring reports is the member of the management board (Martin Kruus). As all everyday business of RRT is managed by renewable operator company OÜ Nelja Energia (4energia) under a management agreement, 4energia also takes care of monitoring and verification activities for RRT. The responsible person at 4energia is the production manager (Raimo Pirksaar). 4energia may subcontract third parties to assist in the process (LHCarbon OÜ, represented by Hannu Lamp). Due to the limited complexity of the GHG calculation approach no specific processes for internal verification have been defined. This is part of the overall responsibility of the PTP management Findings None Conclusion The project complies with the requirements. Periodic Verification Findings

19 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 3.6 Completeness of Monitoring Discussion The reporting procedures reflect the monitoring plan ( Monitoring plan of Esivere and Virtsu II Wind Power JI Project, version 1.0, May 30, 2008). Before this the monitoring procedures fixed in a PDD has been followed. No changes to the monitoring plan are required Findings See FAR#2 in article Conclusion The project complies with the requirements, assuming appropriate handling of FAR #2 in the ongoing verification period. 3.7 Accuracy of Emission Reduction Calculations Discussion Besides the grid emission factor no further estimates or default data are used. The emission factor is calculated based to the principles stated in the PDD/Baseline study and which is valid for the whole crediting period (EFy= tco2/mwh). The produced amount of electricity supplied to the main grid is measured by a calibrated power meters, which are connected to the remote-control system of the Main Grid. GHG emissions are calculated according the formula presented in the PDD and in the Monitoring Plan taking into account net electricity production and calculated emission factor. Audit team confirms that emission reduction calculations have been performed according to the MP Findings None Conclusion The project complies with the requirements, assuming appropriate handling of FARs in the ongoing verification period.

20 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 3.8. Quality of Evidence to Determine Emission Reductions Discussion Calculation of emission reductions are based on external data (basis: Eesti Energia). The relevant electricity meters as source of those data were checked directly. They are subject to Eesti Energia s standards. For plausible check and in case of failure of power meters the data from Enercon SCADA system is used, which gives production data of turbines without grid losses (between turbines and substation). Taking of periodic power meter readings from Eesti Energia substation should secure the reliability of Main Grid data. Further on, entering and processing of those data in the monitoring excel sheet was checked as well as recalculation of the sum of those data Findings None Conclusion The project complies with the requirements. 3.9 Management System and Quality Assurance Discussion Due to the straightforward approach for calculating GHG emission reductions the existing management system is appropriate and quality assurance is guaranteed Findings See FAR#2 in article Conclusion The project complies with the requirements, assuming appropriate handling of FAR #2 in the ongoing verification period.

21 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 4. PROJECT SCORECARD The conclusions on this scorecard are based on the revised monitoring report. Risk Areas Conclusions Summary of findings and comments Baseline Emissions Project Emissions Emission Reductions Completeness Accuracy Source coverage/ boundary definition Physical Measurement and Analysis Data calculations All relevant sources are covered by the monitoring plan and the boundaries of the project are defined correctly and transparently. State-of-the-art technology is applied in an appropriate manner. Appropriate back-up solutions are provided. To prevent any future problems, FAR#1 shall be implemented. Emission reductions are calculated correctly. Consistency Data management & reporting Changes in the project The data management process relies to some extent on the input of the national utility and the turbine vendor. Potential for improvement is indicated by FAR#2. Results are consistent to underlying raw data.

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23 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist 6 REFERENCES 1. On-site interview at 4Energia OÜ and site-visit by auditing team Verification team on-site: OÜ Ekoekspert Interviewed persons: Raimo Pirksaar 4Energia OÜ Hannu Lamp LHCarbon OÜ Raul Kõllamaa Siemens Electroservice (representing Eesti Energia Main Grid) Category 1 Documents: Documents provided by the Client that relate directly to the GHG components of the project. These have been used as direct sources of evidence for the initial verification conclusions. Reference No. Document 2 Project Design Document for Esivere and Virtsu II Wind Power Developments. ECON Analysis, March Esivere and Virtsu II Wind Power Development Baseline Study. ECON Analysis, Final Determination Report Esivere and Virtsu II Wind Power Developments. JI Project, Estonia. Report No , March TÜV Industrie Service GmbH 5 Monitoring Plan of Esivere and Virtsu 2 Wind Power, version 1, May 30, Monitoring Report No 1 for period Esivere and Virtsu II Wind Power JI Project.Version 3.1, May 30, Esivere and Virtsu 2 Monitoring Protocol and ER calculation. Excel sheet. 8 Esivere grid loss calculations. Excel sheet 9 Esivere production data. Esivere 2007 production data Excel sheets 10 Letter of Approval, issued by Ministry of Environment of Estonia on the , no /15942

24 Initial and First Periodic Verification of the JI Project: Esivere and Virtsu II Initial Verification Checklist Annex 1 Initial Verification Checklist

25 Klaus Nürnberger - Initial Verification Checklist - 1 of 13 Initial Verification Checklist A. Opening Session OBJECTIVE Ref. COMMENTS Concl.(incl FARs/CARs) A.1. Introduction to audits The intention and the target of the audit were introduced to the participants of the audit. Participants at the audit on the part of the owner, Roheline Ring Tuulepargid OÜ, the operator, Nelja Energia OÜ and consultant LHCarbon OÜ: Raimo Pirksaar, OÜ Nelja Energia, Production Manager Hannu Lamp, LHCarbon OÜ, consultant to OÜ Nelja Energia Participants at the audit on the part of TÜV SÜD, OÜ Ekoekspert, Tallinn A.2. Clarification of access to data archives, records, plans, drawings etc. A.3. Contractors for equipment and installation works Who has installed the equipment? Who was contracted for planning etc.? The verification team got open access to all required plans, data, records, drawings and to all relevant facilities. 1 The construction and erection of wind turbines has been divided into two lots, as the project itself is bundled, consisting two separate wind parks - Esivere Wind Park, consisting 4 Enercon E kw wind turbines, started to operate in October 2005; - Virtsu II, consisting 3 Enercon E70 E kw wind turbines, is in stage of testing. The main contractor for both lots was Enercon, the manufacturer of the A-1 Report No rev. 00 This document is a part of the Validation and Verification Manual

26 Klaus Nürnberger - Initial Verification Checklist - 2 of 13 OBJECTIVE Ref. COMMENTS A.4. Actual status of installation works Project installation should be finished at time of initial verification in so far as the project should be ready to generate emission reductions afterwards. B. Open issues indicated in validation report Especially in projects which are not yet registered at CDM-EB or JI-SB, there might be some outstanding issues which should have been indicated by the validation report. wind turbines. Both main grid 110 kv sub-station have been constructed/rehabilitated by Eesti Energia. The Virtsu sub-station had to be extended/ rehabilitated as it is planned to construct the connection point also for Virtsu III wind park in the same Virtsu Wind Park sub-station. For Virtsu II and III wind parks is constructed separate sub-station near to Eesti Energia s Virtsu substation. The construction works in the Virtsu windpark substation are over. Connection point for both windparks is common and it is located in Main Grid 110 kv side. In Windpark sub-station have both wind park separate measuring equipment in 20 kv side. 1 The erection, testing and commissioning of the Esivere wind park finished in September 2005, all turbines became operational at the end of September Virtsu II wind farm commissioning has been delayed due to the delays with reconstruction of grid connection point by national utility Eesti Energia. The trial production of the wind farm was started in April 2008, the produced wind energy was supplied to the grid. Virtsu II wind farm became fully operational at the end of April 2008.Local municipality will issued the official user permit end of summer B.1. Missing steps to final approval 10 The project meets all relevant UNFCCC and Estonian requirements. The Letter of Approval is issued by the Ministry of Environment on the Concl.(incl FARs/CARs) A-2 Report No rev. 00 This document is a part of the Validation and Verification Manual

27 Klaus Nürnberger - Initial Verification Checklist - 3 of 13 OBJECTIVE Ref. COMMENTS 28. December Specific national guidelines and procedures for JI projects in Estonia exist since April 2008, but only in draft version. The verification team did not identify any missing steps. Concl.(incl FARs/CARs) C. Implementation of the project This part is covering the essential checks during the on-site inspection at the project s site, which is indispensably for an initial verification C.1. Physical components Check the installation of all required facilities and equipment as described by the PDD. 1 All details of the wind park were checked. Esivere wind park covers the 4 turbines (Enercon E kw), the cabin with the electrical and control equipment, 35-kV-transformer, main grid meter. Virtsu II wind park covers the 3 turbines (Enercon E kw), the cabin with the electrical and control equipment, 35-kV-transformer, main grid meter. C.2. Project boundaries Check whether the project boundaries are still in compliance with the ones indicated by the PDD. C.3. Monitoring and metering systems Check whether the required metering systems have been installed. The meters have to comply with appropriate quality standards applicable for the used technology. 1 The project boundaries were checked. They are in compliance with the ones indicated in the PDD. 1 All required metering systems have been identified and checked. The following meters are relevant for the calculation of emission reductions; they are all on the premises of the Eesti Energia 110 kv sub-stations: - Esivere wind park has main grid meter (110 kv) in Rõuste substation, which belongs to Eesti Energia. The power meter itself belong to Eesti Energia too. Main grid power meter Landis+Gyr ZDM405CT No , the testing label (calibration FAR#1 A-3 Report No rev. 00 This document is a part of the Validation and Verification Manual

28 Klaus Nürnberger - Initial Verification Checklist - 4 of 13 OBJECTIVE Ref. COMMENTS sticker) AE (June, 2005) is placed. The meter is within its first calibration period. The meter complies with the appropriate standards. - Virtsu II wind park has main grid meter (110 kv) in Virtsu substation, which belongs to Eesti Energia. The power meter itself belongs to Eesti Energia too. Main grid power meter Landis+Gyr ZDM405CT No , the testing label (calibration sticker) AE (June, 2007) is placed. The meter is within its first calibration period. The meter complies with the appropriate standards. Both main grid meters are 2-direction meters, measuring power supplied from the wind park and to the wind park. All turbines have their own power meters NZR 3x230/400Vg, belonging to the wind park and which are connected to the Enercon SCADA system. Concl.(incl FARs/CARs) Virtsu III wind park, which is under the development at the moment, has already a separate power meter at the same Virtsu 110 kv wind park sub-station. It is expected, that Virtsu III wind park will start operation in spring Forward Action Request #1: The developer should ensure that Virtsu III wind farm, which is connected to the same substation, will have an own connection on 35 kv level and separate measuring system in order to separate the power generation from both wind parks the existing Virtsu II and the planned Virtsu III. C.4. Data uncertainty 1 The meters were sealed and had valid calibration stickers (see item A-4 Report No rev. 00 This document is a part of the Validation and Verification Manual