Joint Crediting Mechanism Project Design Document Form

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A. Project description A.1. Title of the JCM project Joint Crediting Mechanism Project Design Document Form Note: This JCM Project Design Document (PDD) is drafted as the result of the GEC s JCM Feasibility Study Programme in JFY2013. Therefore, this draft PDD is not officially approved by any governments involved in JCM, and is subject to change in the future. Centralization of heat supply system by installation of high efficiency Heat Only Boiler in Bornuur soum A.2. General description of project and applied technologies and/or measures The Bornuur is located in the north of Tuv province, 105 km distant from Ulaanbaatar and 155 km from center of Tuv province. The altitude of the soum is 1000-1500 m above the sea level. In terms of the earthquake, the soum is in 7 magnitudes area. The soum is harmonious for agriculture and animal husbandry because the location of the soum is in the zone of forest steppe natural. The summer of the Bornuur soum is cool and dry and the winter is cold. The monthly average temperature in January is -30 0 C and +30 0 C in July. The annual average precipitation is 250-350 mm. The total territory of the soum is 114,687 hectares. About 70% of the land is being used for agricultural purpose, 26% is forest reserve and 0.08% represents water resources. As of 2012, about 2.37% of land is in urban areas, 0.11% is in special use territory and 0.92% is covered by roads and networks. At the end of 2012, the total soum population was 4,825 and the number of households reached 1,387. The population of the soum center was 1,019. The soum is divided into 4 bags (residential districts), the smallest administrative unit. The total livestock population is 93,153 heads. About 0.05% of them is camel, 7.4% is horse, 12.7% is cow, 44.4% is sheep and 35.4% is goat. Table 1 Harvest Volume (as of 2012) Types of harvest Planted area, hectare harvest, tons Wheat 1,500 1,310 Potato 740 15,354 II-1

Vegetable 460 5,352 Fodder 1,680 2,576 The soum center is connected to Central grid. It has access to 110/35/10 kw substation and clean water supply. There are 6 wells and 3 water reservoirs with volume of 16 m3 each. As for the drinking water supply, water softening equipment with capacity 30 m3/day was installed. In the soum center, buildings of local government, health center, cultural center, kindergarten and secondary school have own Heat Only Boilers (HOB). The soum secondary school, which has 2-story building, has 880 students and 79 teachers. As for kindergarten, there are 234 children and 21 workers. Unfortunately, the building of the kindergarten is in very bad condition. The building needs total refurbishment. The health center, which has built in 1978 and now has 13 beds, has total of 29 staff, including 4 doctors and 7 nurses. The soum cultural center, which was constructed in 1959 with 250 seats, is operated by 8 workers. The building needs renovation. The local government building was constructed in 1959 and needs renovation as well. In the end of 2013, there are seven HOBs in Bornuur soum. These seven HOBs are four vertical type boilers, two brick boilers and one small size boiler. Table 2 Existing HOB in Bornuur soum Facilities Name Type of HOB Remark School D-27 Brick Boiler Dormitory HP25Ж Vertical Type Boiler Kindergarten D-27 Brick Boiler Cultural center CLSG Vertical Type Boiler Local governor s office POP-90 Small Size Boiler Old hospital HP15Ж Vertical Type Boiler New hospital LSH Vertical Type Boiler II-2

HOB of school in Bornuur soum Figure 2 Photo of HOB in Bornuur soum HOB of Dormitory in Bornuur soum The project is the infrastructure building in Bornuur soum of Tuv aimag in Mongolia, composed of the installation of Heat Only Boilers (HOBs) as well as pipe laying work, electrical construction and boiler building construction. The project will alter the current heat supply system in Bornuur soum of individual building based heating, under which the low efficiency HOBs and stoves are used. The replacement of low efficiency HOB with EKOEFEKT (650 kw, high efficiency HOB) leads to CO2 and other air pollutants emission reductions. The EKOEFEKT BIO 130-600 boilers are designed for comfortable, ecological and economical heating with minimal requirements for manual operation. The boiler operator checks the boiler occasionally, adds fuel and takes out the ash. Fuel is automatically fed from the hopper to the rotary grate. The amount of fuel on the grate is optimized, burning only the minimum amount required to cover the heat demand of the building at the time. The monitoring equipment which measures the exhaust gas temperature or the exhaust gas O2 concentration is introduced. The Japanese engineer implemented the technical guidance optimizing the operation of the boiler from these measurement results. A.3. Location of project, including coordinates Country Region/State/Province etc.: City/Town/Community etc: Mongolia Tuv aimag Bornuur soum Latitude, longitude Latitude : 48 27 53 Logitude : 106 15 26 II-3

A.4. Name of project participants Mongolia Japan ANU-SERVICE CO.,LTD. SUURI-KEIKAKU CO.,LTD. A.5. Duration Starting date of project operation 2013/08/28 Expected operational lifetime of project 7 years (Operational lifetime of HOB is 15 years) A.6. Contribution from developed countries Japanese experts of SUURI-KEIKAKU CO., LTD will support the development of telemeter system such as the remote control and automatic record, as the core of MRV activities of JCM. SUURI-KEIKAKU CO., LTD introduces the monitoring equipment which measures exhaust gas temperature or exhaust gas O 2 concentration, and etc.. The Japanese engineer performs the technical guidance optimizing the operation of the boiler from these measurement results. Japanese side provides financial support to the project. There are few CDM project in Mongolia. Therefore, there is little experience from the development of the monitoring plan to making the monitoring report. Since EEC is the dominant candidate of the monitoring entity, our Japanese Team implements the capacity development of the monitoring activity to the EEC staffs. B. Application of an approved methodology(ies) B.1. Selection of methodology(ies) Selected approved methodology No. --- Version number --- Selected approved methodology No. --- Version number --- Selected approved methodology No. --- Version number --- B.2. Explanation of how the project meets eligibility criteria of the approved methodology Eligibility criteria Criterion 1 Descriptions specified in the methodology The technology to be employed in this methodology is coal-fired heat only boiler (HOB) for heat water II-4 Project information The purpose of the boilers is to heat school, hospital, kindergarten and cultural center and local governor s office and etc.. The boilers are hot water low pressure

Criterion 2 supply system. The HOB to target for the project activity is defined as a boiler used for heat supply which has capacity of 0.10 MW 3.15MW. automatic boilers and designed for brown coal (5-25) mm burning only. Three high efficient coal fired boilers EKOEFEKT 600 with capacity of 600 kw each, are being installed at project site. The three new high efficient HOBs EKOEFECT of capacity 600 kw each will replace 7 old small inefficient boilers. Criterion 3 The project activity encompasses installation of new HOB, replacement of the existing coal-fired one and expansion of the Power output Optimal regulation of power output 600 kw 250-600 kw capacity for the existing coal-fired one. Consuption of fuel 70-150 kg/h Heated space 15000 m3 Efficiency 80% Hopper capacity Max oparating pressure of hot water Max temperature of hot water 1200 kg 200 kpa 95 C The noise of the ventilator 75 db Boiler weight Bolier height 5500 kg 2800 mm II-5

Boiler width Bolier depth Input/output water Diameter of flue gas pipe 1700 mm 3500 mm 125 DN mm 200 mm Flue gas temperature 110-230 C Exhaus gas mass flow Power consuption/ Operation voltage Water volume 0,50 kg/s 2300 / 400 W/V 2600 l Criterion 4 Criterion 5 The project HOBs have dust collectors. In case of a HOB which dust collector is not set up, dust collector is additionally installed with the installed HOB for pollution-abatement measure. Boiler operation manual and maintenance manual is established. The EKOEFEKT-600 boilers are designed with separate dust collector of capacity 500 kg The manual of boiler operation will be prepared in Mongolian language. Criterion 6 Criterion 7 The catalogue value of boiler efficiency of project HOB is more than 75%. One of the following technologies is applied to project HOB. The boiler has the function to feed uniformly coal on the stoker. The boiler has the adjustment system of the combustion air. The boiler has the function for preventing air-invasion into the furnace. The catalogue value of EKOEFEKT is 80%. The boiler has the function to feed uniformly coal on the stoker. Fuel is automatically fed from the hopper to the rotary grate. The amount of fuel on the grate is optimized, burning only the minimum amount required to cover the heat demand of the building at the time. Fuel supply is regulated by a control unit which takes into account the energy requirements of the boiler. The boiler has the adjustment system II-6

of the combustion air. In order to ensure the complete combustion of flammable substances contained in the fuel, a sufficient amount of air is supplied to the combustion chamber. The boiler has the function for preventing air-invasion into the furnace. The chamber is coated with a ceramic lining which ensures a high efficiency of combustion. The supply of primary air for combustion is provided by an exhaust fan which is located at the throat of the chimney. The boiler works at a low pressure due to a ventilator draft. C. Calculation of emission reductions C.1. All emission sources and their associated greenhouse gases relevant to the JCM project Reference emissions Emission sources GHG type Coal Consumption of reference HOB CO 2 Project emissions Emission sources GHG type Coal Consumption of project HOB CO 2 Electricity Consumption of project HOB CO 2 II-7

C.2. Figure of all emission sources and monitoring points relevant to the JCM project The emission sources are coal consumption in HOB. The monitoring equipment is the heat meter which measures the quantity of net heat supply of HOB. Heatmeter Controller Signal Conductor School, Hospital, etc. HOB EKOEFEKT T1 T2 V1 Monitoring Points of Heat meter C.3. Estimated emissions reductions in each year Year Estimated Reference Estimated Project Estimated Emission emissions (tco 2e ) Emissions (tco 2e ) Reductions (tco 2e ) 2013 0 0 0 2014 2,146 1,780 366 2015 2,146 1,780 366 2016 2,146 1,780 366 2017 2,146 1,780 366 2018 2,146 1,780 366 2019 2,146 1,780 366 2020 2,146 1,780 366 Total 15,022 12,460 2,562 (tco 2e ) II-8

D. Environmental impact assessment Legal requirement of environmental impact assessment for the proposed project This JCM project is deemed to be necessary to implement the detailed natural environment impact assessment, from following reasons; 1) The influence on the natural environments is established by being based on the detailed environment impact assessment. 2) The situation that project capacity (3.0MW / h) exceeds the required amount of heat (0.9 MW / h) needs to be confirmed. 3) It is necessary to check the actual natural environment basic situation of the JCM project area. 4) Confirmation of the expert is required about the design drawing of the boiler building. 5) The natural environment conservation assessment and conclusion is put regarding technology choices of the boiler. E. Local stakeholder consultation E.1. Solicitation of comments from local stakeholders Date: from 13:30 to 15:00, 26 th September 2013 Place: Culture Center in Bornuur soum Participants: 67 people of living and/or working in Bornuur soum, and 57 people of questionnaire response. Handout: Questionnaire (Mongolian language), Outline of JCM (Mongolian language) Agenda: 1) Outline of JCM (Mr. Kuwahara), 2) Background and progress situation of JCM Project (Mr. Kuwahara), II-9

3) Technical review of Centralization of heat supply system by installation of high efficiency HOB in Bornuur soum (Mr. Injinaash), 4) Q&A, 5) closing remark The announcements of newspaper and web site are as follows; The circumstances of stakeholder consultation were as follows; E.2. Summary of comments received and their consideration Stakeholders Comments received Consideration of comments received Male A Is there the possibility to use the other fuel other than the coal? Since coal is abundant in Mongolia, we do not worry the supply of coal, and the price of coal is very low. As a result, the fuel choice is only coal. Male B Is this infrastructure of HOB system enough for heat supply in whole of Bornuur soum? Three EKOEFEKT boilers, which have 650 kw capacities, are enough for heat supply. Since the boiler II-10

house has enough space, the expansion of HOBs is possible in the future. Male C Does this infrastructure include the water supply and sewerage systems? This JCM project is only the infrastructure of HOB system, which is only the heat supply system. In the future, we will consider the other infrastructure such as water supply and sewerage systems, etc.. Female D Can we receive the service of the heat supply, if we are living in Bornuur soum and we prepare at own If you prepare your own money, then we can do the heat supply for your home. expense? Female D Will the HOB be operated enough stably? We will realize the stable operation of HOB in the future. F. References Reference lists to support descriptions in the PDD, if any. Annex Revision history of PDD Version Date Contents revised 01.0 21/02/2014 First edition II-11