Wednesday, January 20, 2010

Adani Power becomes first CDM certified Project by UNFCCC

India’s private power projects are committed to Clean Development. Adani Power project has achieved a certification of its first super critical technology based upcoming project at Mundra from United Nations body authorized under Kyoto Protocol .
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Adani Power Ltd.(APL) has become the first mega power project to get registered as a Clean Development Mechanism (CDM) project by the United Nations body authorized under Kyoto Protocol to register such projects after elaborate and stringent scrutiny.

This certification is awarded for two power plants of 660 mw each are being set up by APL at Mundra in Gujarat with super-critical technology. With this technology, coal consumption is lower and 10% more power is generated compared to the conventional technology. This criteria qualified the project to get the CDM certificate. The plant is expected to be commissioned during 2010-11.

APL got the certificate during the 51st executive board meeting of the United Nations Framework Convention on Climate Change (UNFCCC) held at Copenhagen, Denmark in the first week of December 2009. The committee members reviewed the replies and various documents submitted by Adani Power during the meeting and approved this project as a CDM project.

Under the guidelines of the UNFCCC under the ACM013 methodology applicable to this project, the two units at Mundra will be eligible to generate 18,39,560 carbon emission reduction (CER) per annum for 10 years from the first year of generation. The current trading price of CER is at 12 Euro per CER. Thus APL will be able to generate revenues of Rs140 crore to Rs150 crore annually out of it.

The process of awarding CDM certificate is multistage evaluation process involving approvals from the Ministry of Environment & Forest in India, evaluation by Independent Validator of the Project Concept Note and Project Design Document, followed by review of Independent Validator’s report by Committee Members of UNFCCC with final queries being raised by UNFCCC committee members.

The super-critical coal fired power plants attract high capital investment compared to the sub-critical coal fired power generation. But the enhanced plant efficiency reduces emissions of CO2 and all other pollutants by consuming less fuel per unit of electricity generated. The efficiency improvements and thereby reduction in CO2 Green House Gas (GHG) using super-critical technology leads to registration of such Thermal Power Project as Clean Development Mechanism (CDM) project and earning of Certified Emission Reductions (CERs) through the CDM under the Kyoto Protocol.

APL is setting-up 9,240 MW thermal power generation capacity; 4,620 MW at Mundra, Gujarat, 3300 MW at Tiroda, Maharashtra and 1320 MW at Kawai, Rajasthan. Out of this 8,000 MW capacity is based on environment friendly Super-critical technology.

The Adani Power stock has been trading in the range of 100 – 104 below the offer price. But the investment advisors have been rating this share above RPL. The volume of trading increased on Wednesday. The total traded quantity was 801528 compared to 2 week average of 937850.


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