Renewable energy – use of hydropower to replace fossil fuels for electricity generation
Description of Project
This 3.75 MW small hydropower project reflects ongoing efforts to provide low-carbon power for China’s economic development. The project provides electricity to the local grid in rural China, displacing power from polluting fossil fuel-fired generators and controversial large hydropower projects.
Project Type
Renewable Energy
View detailed project specification
Project location
Guizhou Province, China
Project proponent
Guizhou Zhongshui Hengyuan Project Management and Consulting Co., Ltd.
Credit type
Voluntary Carbon Standard VERs
Total emission reductions
8,200 tonnes CO2e between 2006 and 2008
Additionality Test
Established using the CDM Additionality Tool. The benchmark financial internal rate of return (FIRR) on total investment for hydro power projects is 10%. Without the income from carbon credits the FIRR of the project is 6.39% and is financially unacceptable. With the income from carbon credits, the FIRR is increased to 11.75%.
Social and environmental considerations
The project contributes to sustainable development by reducing greenhouse gas emissions, compared to a business-as-usual scenario. In addition, the project reduces other pollutants resulting from the power generation industry in China, creates local employment opportunities and reduces poverty in Ningxia, a region with relatively low household incomes. In addition, the project developers are subsidising electricity connections for the local community – helping them to benefit from the presence of the hydropower project.
Current status of project
Completed
Commencement of project operation
December 2006
Vintages
2006-2008
