A research study submitted in partial fulfillment of the requirements for the degree of Master of Engineering in Energy

Research Studies Project Report (M.Eng.) - Asian Institute of Technology, 2007

Tra Linh 3 small hydropower project is constructed in Tra My District, Quang Nam Province. This project is analyzed as a case study for implementation under Clean Development Mechanism (CDM). The Tra Linh 3 small hydropower project has an installed capacity of 7.2MW, and an annual electricity generation capacity of 29,850MWh. The objectives of this research study are the following: (a) to review the potential of small hydro power with install capacity from 1MW to 30MW in Vietnam, and (b) to carry out additionality analysis to demonstrate and assess additionality of the project; to identify baseline scenario; to determinate GHG emission reduction; and to carry out financial analysis of the project. Application the baseline standardization to estimate baseline emission coefficient for renewable-energy-based grid-connected power projects is based on "combined margin approach". Due to essential of power generation source in recent year in Vietnam, generation source Low Cost/Must Run less then 50%, the simple operating margin (SOM) method is chosen to estimate the baseline emission coefficient. According to the current power system in Vietnam, the value of SOM emission coefficient estimated using the data of three years (2003, 2004, 2005) is 0.8084, and the value of build margin emission coefficient for five power plants built in most recent years is 0.4179. Finally, the combined margin emission coefficient of baseline emission is calculated by average value of simple margin operating and build margin is 0.6131. Annual GHG emission reductions of Tra Linh 3 small hydropower are 18.3 million tons of CO2. Financial analysis shows that the financial internal rate of return (FIRR) of the project would increase from 9.17% in the case without CERs to 12.01% in the case with CERs at the price $8/tCO2.