India: First Manufacturer with CDM PoA Project

Bengaluru-based Nuetech Solar Systems, successfully registered its Clean Development Mechanism (CDM) Programme of Activities (PoA) with the UN Framework Convention on Climate Change (UNFCCC) on 31 December 2012, the last date for registration under the Kyoto Protocol. This has made it the first and only manufacturer of solar water heaters in India to have registered a CDM PoA project. The first Indian solar thermal CDM project ever was registered by Indian developer G.K. Energy Marketers in November 2010.

Nuetech is the coordinating / managing entity of the project called Solar Water Heater Program in India and the Program of Activities (PoA) covers the entire nation. Nuetech has teamed up with Mabanaft Carbon from the Netherlands, itself also a project participant. The necessary approval from both institutions - the Indian Ministry of Environment and Forests and the Netherland´s Ministry of Infrastructure and the Environment has paved the way for the cooperation.

The special characteristic of a CDM PoA project is its capacity to develop an unlimited number of sub-projects, so-called Programmes of Activities (PoAs). Nuetech has registered the first PoA-1 covering its installed solar water heaters (SWH) between July 2007 and December 2009. PoA-2 will include the sales of Nuetech during the years 2010, 2011 and 2012. The first CDM Programme Activity (CPA-1) expects an annual generation of about 31,500 Certified Emission Reductions (CERs) per year and revenues will start accruing from 1 January 2014 on.

One of the salient features of the project is that other manufacturers and distributors of SWHs in India can also take part in the CDM programme by implementing their own uniquely identifiable PoAs. All SWHs installed after 1 January 2010 are eligible for inclusion.

Tyagamundlu Ananth, CEO of Nuetech, explains that “it requires installing about 50,000 m2 of collector area to make each PoA viable, and any manufacturer or distributor of SWHs in India that wishes to develop its own PoA can join the project, which started on 1 January 2010. All systems within the boundaries of the country are eligible if they fulfil the overall modalities and procedures of the CDM PoA.”

Under the project, each collector of 2 m2 will account for 1.06 CERs per annum for a period of seven years, which can be renewed 3 times (maximum is 28 years) during the life span of the installed SWHs, and it has to be proven that the installed SWHs are working satisfactory year after year, to benefit from the carbon credits. This makes it necessary that Nuetech monitors the SWHs and gives timely reports to Mabanaft. The monitoring report shows proof of the fuel saved every year and the team of UNFCCC will carry out random checks.

Eligible for the PoA is any installation, domestic or non-domestic - commercial, institutional or industrial - up to a maximum of 640 m2 each. Ananth adds: “The archiving of data is an important aspect of a CDM project, and as a Channel Partner of MNRE, it has been a good experience because both require us to maintain very similar data. We are planning to establish a separate CDM Secretariat, which will give the required comfort zone to similar SWH manufacturers wishing to join forces. The inclusion into the CDM PoA will be purely voluntary, and any recognised player who wants to join is welcome.”

The value of the CERs is relatively low these days, but is expected to pick up in the years to come. Nuetech has already applied to convert the CDM PoA into a Gold Standard CDM Project, which opens up a wider market and attracts better value for the generated CERs. Developing and registering the CDM PoA under Gold Standard Rating involves relatively higher costs, but these are paid back by the CDM revenues earned in the first two years, according to Ananth.

More information:
Nuetech Solar: http://www.nuetechsolar.com
PoA: http://cdm.unfccc.int/ProgrammeOfActivities/poa_
db/N0SLBQPXCMY1EI5OHD87R9624VUJK3/view

Mr Ananth may be contacted at ceo@nuetechsolar.com

This text was written by Jaideep Malaviya, an Expert in Solar Thermal based in India (malaviya@solrico.com)

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