Appendix

Additional information to the Proposed Methodology“Introduction of Biomass Combined Heat and Power Plant”
It is concluded to apply the: 1) boiler efficiency of 93% for calculating the reference emissions from heatgeneration; and 2) emission factor of 0.533 tCO2/MWh and grid power interruption time percentage of 2%
for calculating the reference emissions from electricity generation, to achieve net emission reductions.

1. Heat generation
1.1. Background
Emission reductions from displacement of fossil fuel consumed for heat production are calculated bymultiplying the amount of heat displaced by the inverse of the reference boiler efficiency and emission
factor of the reference fuel. In order to secure net emission reductions, the fuel used and efficiency ofindustrial boilers in Ethiopia were studied.

1.2. Findings and rationales
There is no official data on the boilers used in Ethiopia. However, from the interviews with government
officials and business people it can be assumed that in Ethiopia, the common source of energy for boilers
used in industries is diesel. It is also noted that thermal oil boilers are commonly used.
The efficiency of modern diesel -fired thermal oil boilers can be as high as 93%1. For example, BonoEnergia S.p.A. has supplied at least four thermal oil boilers to Ethiopia2.

The boilers usually run below the maximum efficiency because such efficiency is only achieved undercertain optimal conditions. In order to achieve net emission reductions, it is assumed that the heat provided
to the heat loads by the project biomass CHP plant displaces heat produced by a diesel-fired thermal oilboiler running constantly at an efficiency of 93%. Furthermore, the reference emissions assume zero heatloss during heat transfer from the boiler to the heat loads.

2. Electricity generation
2.1 Background
Emission reductions from displacement of fossil fuel consumed for electricity generation are calculated bymultiplying the amount of electricity generated by the project biomass CHP plant, by the grid powerinterruption time percentage and emission factor of captive gensets. In order to secure net emission
reductions, the annual time of power interruption and emission factors of captive gensets in Ethiopia werestudied.

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Website of Bono Energia S.p.A.
Information provided by Bono Energia S.p.A.
12.2. Findings and rationales
2.1. Status of grid power and power interruption
The power source of the national grid of Ethiopia is almost 100% renewable. However, power interruption
is very common and industries requiring continuous operation resort to captive diesel power generation.
The Enterprise Surveys conducted during 2015 and 2016 by the World Bank3 found that the number ofpower interruption in a typical month was 8.2 and each interruption lasted on average 4.6 hours. Thistranslates into an interruption duration of approximately 453 hours per year or a power interruption timepercentage of 5.2%.

In addition, the raw data of the medium voltage line interruption report provided by the Ethiopian Electric
Utility was analyzed. The dataset contained the duration of power interruption of all medium voltage
feeders in the greater Addis Ababa area recorded at the substations. The analysis found that the averageinterruption duration for a feeder ranged from 176 to 365 hours per year during the past three years4. Thistranslates into a power interruption time percentage of 2.0% to 4.2%.

Accordingly, it is assumed that as the minimum ratio from the survey 2% of the electricity generated by theproject biomass CHP plant displaces electricity generated by a captive diesel genset using the most efficientdiesel power generator in the world, and the balance displaces grid electricity, which is assumed to have anemission factor of zero.

2.2. Emission factor of diesel power generation
The emission factor of the most efficient diesel power generation is found to be close to 0.533 tCO2/MWhin the additional information for the approved JCM methodology PW_AM001 “Displacement of Grid andCaptive Genset Electricity by a Small-scale Solar PV System.” According to that additional information,
the most efficient diesel power generator in the world has a generation efficiency close to 49%. In order toachieve net emission reductions, an emission factor of 0.533 tCO2/MWh, which corresponds to a power
generation efficiency of 49%, is selected as the reference emission factor of captive gensets.

3. Conclusions
From the foregoing discussions, in order to achieve net emission reductions, it is concluded to apply the: 1)
boiler efficiency of 93% for calculating the reference emissions from heat generation; and 2) emission
factor of 0.533 tCO2/MWh and grid power interruption time percentage of 2% for calculating the reference
emissions from electricity generation.

3

http://www.enterprisesurveys.org
Data for the period of 1 June 2013 to 31 May 2016 was analyzed. In case of missing data or doubt in therecorded data, the analysis assumed zero interruption to ensure underestimation of the interruption duration.
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