Feasible Study on Renovation of Exiting Hotel to Eco-hotel
Transcription
Feasible Study on Renovation of Exiting Hotel to Eco-hotel
Feasibility Studies with the Aim of Developing a Bilateral Offset Credit Mechanism FY2011 Studies for Project Exploration and Planning Feasible Study on Renovation of Exiting Hotel to Eco-hotel in Off-grid Area of Kenya New Energy and Industrial Technology Development Organization (NEDO) NTT Data Institute of Management Consulting, Inc. Fuji Electric Co., Ltd. Mpata International Inc. Feasibility Studies with the Aim of Developing a Bilateral Offset Credit Mechanism FY2011 Feasible Study on Renovation of Exiting Hotel to Eco-hotel in Off-grid Area of Kenya Studies for Project Exploration and Planning 29th February, 2012 NTT Data Institute of Management Consulting, Inc. Fuji Electric Co., Ltd. Mpata International Inc. CONTENTS 1.Overview of the Survey 2.Feasibility of Introducing Energy saving Technology and Renewable Energy into MPATA SAFARI CLUB 3.Survey of Current Green Electrification at Other Hotels 4.MRV Methodology When Renewable Energy Is Introduced to Hotels 5.Feasibility of Bilateral Offset Credit Mechanism 6.Future Issues and Project Plan Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 2 1-1. Perspective (1) ¾ This feasibility study (F/S) tries to produce ecofriendly electricity for hotels in off-grid area of Kenya. ¾ Case study = Mpata Safari Club Mpata Safari Club Located in The Masai Mara National Reserve -Five-star luxurious hotel -It stands in off-grid area and uses diesel generators to make electricity. NAIROBI Copyright © 2012 NTT DATA Institute of Management Consulting, Inc. 3 1-2. Perspective (2) ¾This F/S is financed by NEDO of Japan. (New Energy and Industrial Technology Development Organization) an incorporated administrative agency ¾And NEDO is under the jurisdiction of METI. (Ministry of Economy, Trade and Industry of Japan) “But, why Japan is doing this?” Copyright © 2012 NTT DATA Institute of Management Consulting, Inc. 4 1-3. Problems of CDM (from Japanese Side) ¾ NEDO, METI, and Japanese industrial circles, finds current CDM* unpractical and rather problematic. (*Clean Development Mechanism under the Kyoto Protocol) – A project needs a long time: 2 years – Applicable technologies unbalanced – International partiality: 59% China (in Jan 2012*) ¾ Japan don’t deny the CDM. But try to invent alternative mechanisms to mitigate the climate change by introducing technologies of Japan. COP17 in Durban: Japan will not participate in the second promise (2013-) of Kyoto Protocol. Copyright © 2012 NTT DATA Institute of Management Consulting, Inc. * http://cdm.unfccc.int/Statistics/Issuance/CERsIssuedByHostPartyPieChart.html 5 1-4. Call for an Alternative to CDM ¾ One of the alternatives is Bilateral Offset Credit Mechanism (BOCM). New International Framework Bilateral Treaty between Governments Project Entity KENYA JAPAN Offset Credit (can be sold) CO2 reduction Project Entity Buyer Companies Offset Credit (can be sold) Project Copyright © 2012 NTT DATA Institute of Management Consulting, Inc. 6 1-5. Four Progressive Steps of Our Project Final goal for NEDO and METI (Japan) ④ Application to Other Hotels / Sale & Purchase of Offset Credit ③ Bilateral Credit Mechanism between Kenya and Japan ② Implementation for Mpata Safari Club: “Mpata Model” ① F/S of This Time Case Study: Mpata Safari Club Copyright © 2012 NTT DATA Institute of Management Consulting, Inc. 7 1-6. Flow of the 1st and 2nd step: Making a “Mpata model” in Kenya Project members Mpata Safari Club (Kenya, Masai Mara) NTT Data Institute of Management Consulting -Five-star luxury hotel -It stands in off-grid area and uses diesel generators to make electricity. -Organize, Research and so on. ■Devices/Equipments to be introduced FUJI ELECTRIC CO., LTD. -Solution and engineering for Renewable energy. Arrange products and technologies of Japanese companies. Mpata International Inc. -Owner of the hotel. -Obtain data and information. -Arrange researches in Kenya. F/S ¾Renewable energy •Solar power (Photovoltaic power generation, Solar water heating ) •Mini-hydro power generator •Wind power generator ¾Energy storage •Batteries (Lead-acid battery, Lithium-ion battery) ¾Energy management and Saving energy •Heat pump unit, Lighting devices etc. Advisers -Specialist on Climate Change, MRV for GHG emission reduction and so on. -Japanese companies. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. Government of Kenya -Offer advice, data, information and so on. 8 1-7. Develop “Mpata model” in off-grid area ¾“Mpata Model” ⇒ Other hotels in the Masai Mara National Reserve. ¾Then to other national parks (There are 2,500 hotels in off-grid area in Kenya). ¾We need to establish a suitable methodology of MRV and how to bundle small credits from various types of hotels. Organizer in Kenya (to bundle small credits and sell) CO2 Credits Masai Mara N.R. (200 hotels / lodges) Mpata Safari Club National park A CO2 Credits National park B CO2 Credits CO2 Credits CO2 Credits CO2 Credits CO2 Credits CO2 Credits ・・・ CO2 Credits CO2 Credits CO2 Credits Copyright © 2012 NTT DATA Institute of Management Consulting, Inc. 2500 off-grid hotels (5000 licensed hotels in Kenya) 9 1-8. Project Entities ¾Three companies take part in this project at this stage. The owner of Mpata Safari Club To Arrange Interview and Field Survey Technical Support Strong in renewable energies, energy saving, and energy management system Project Organizer Methodology of MRV To Research Market Trends in Kenya Copyright © 2012 NTT DATA Institute of Management Consulting, Inc. 10 CONTENTS 1.Overview of the Survey 2.Feasibility of Introducing Energy saving Technology and Renewable Energy into MPATA SAFARI CLUB 3.Survey of Current Green Electrification at Other Hotels 4.MRV Methodology When Renewable Energy Is Introduced to Hotels 5.Feasibility of Bilateral Offset Credit Mechanism 6.Future Issues and Project Plan Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 11 2-1. Conclusions ¾The appropriate plan is to replace portion of the present electricity supply with a PV generation system at Club. ¾This survey found no items to improve for energy saving in Club. However, there could be still room for improvement in equipment operation. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 12 2-2. Ideal plan: 200 kW-size PV generation ¾After calculating the power consumption in the Club, we found that a 200 kWsize PV generation system was an ideal plan. ¾This plan can supply almost all of the electric power needed for the Club during off seasons. It can supply 80% of the total power consumption. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 13 2-3. Ideal plan: CO2 reduction and the cost ¾The 200 kW PV generation system could reduce; 63,700 litter of Diesel consumption and 170 ton/year of CO2 emission ¾But, an an initial investment required to install 200 kW plan would be Over 200 million KSh KSh 1 = ¥1 = $1.25 ¾Practical plan would be introducing a PV generation system of 5kW to 10 kW . ¾5kW to 10 kW model could be applicable to other hotels/lodges in offgrid are of Kenya (also see next chapter). ¾After depreciation, the system can be expanded and optimized when necessary to achieve ideal amount of PV generation system. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 14 CONTENTS 1.Overview of the Survey 2.Feasibility of Introducing Energy saving Technology and Renewable Energy into MPATA SAFARI CLUB 3.Survey of Current Green Electrification at Other Hotels 4.MRV Methodology When Renewable Energy Is Introduced to Hotels 5.Feasibility of Bilateral Offset Credit Mechanism 6.Future Issues and Project Plan Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 15 3-1. Conclusions ¾In Kenya, some tented-camps have already introduced PV generation systems (3.5 to 10 kW) that recoup the initial investment within three to five years. ¾The model plan would be the 5kW to 10 kW PV generation systems. ¾The obstacle to introducing these models lies in finance. Offering financial support for low interest rates is essential to the introduction of models. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 16 3-2. Cases of introducing renewable energy ¾The size of the hotels in the lists is are largest in number in the National Reserves and National Parks of Kenya ¾PV generating systems are around 10kW and the pay back period are around 3 to 5 years. PV generation system Facility name Room type KAREN BLIXEN CAMP Tent lodge (22 guest rooms) SANCTUARY OLONANA Tent lodge (14 guest rooms) ELEPHANT PEPPER CAMP Tent lodge (9 guest rooms) Campi ya Kanzi Tent lodge (8 guest rooms) Olarro Lodge (8 guest rooms) Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. Output 9 kW Initial installation cost (KES) 10MM Payback period 3 years 8kW 3.5 kW 2.4MM 10MM 2 hours/day Other Installed 5 years ago 9 hours/day 5 years (planned) 13.6kW (Substitute 12kVA Diesel generator) 10kW Hours of power generation by diesel generat 2.5 years (planned) 6 to 8 hours/month (equivalent to 15 minutes/day) Small power consumption no use of generator Information from website Information from a constructor 17 3-3. Barriers of installing PV systems; Finance ¾In general, these hotels have accepted foreign investment and/or finance when installing their PV generation systems. ¾ According to one contracting company in Nairobi, the interest on a loan is about 20% in Kenya, indicating that raising funds is very difficult in the country. ¾It is essential not only promoting Japanese PV generating system, but also offering financial support. ¾Practically, the loan at low interest rates would meet local needs. PV Panels in KAREN BLIXEN CAMP, 9kW Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 18 3-4. CO2 Recuction of Model plan ¾From the survey, we come to the conclusion that the model plan would be the 5kW to 10 kW PV generation systems. ¾The amount of CO2 reduction are; – 4.25 tons/year (5kW) to 8.5 tons/year (10 kW) ¾If these models were introduced into 2,500 hotels in off-grid areas in Kenya, CO2 reduction would reach; – 10,625 tons/year to 21,250 tons/year. PV Panels in ELEPHANT PEPPER CAMP, 3.5kW Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 19 CONTENTS 1.Overview of the Survey 2.Feasibility of Introducing Energy saving Technology and Renewable Energy into MPATA SAFARI CLUB 3.Survey of Current Green Electrification at Other Hotels 4.MRV Methodology When Renewable Energy Is Introduced to Hotels 5.Feasibility of Bilateral Offset Credit Mechanism 6.Future Issues and Project Plan Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 20 4-1. Conclusions ¾A methodology for BOCM can be referred to for small-scale CDM and/or PoA and methodologies being deliberated at the UNFCCC. ¾Concerning monitoring methodologies, since hotels in off-grid areas have no electricity meters, their exact power consumption "before introduction" cannot be measured. ¾The appropriate methodology is measuring the "after introduction“ or exact power supplied by renewable energy. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 21 4-2. Baseline ¾When setting a baseline per hotel, Paragraph 8 (b) Option 2 is applied, among the baseline calculation formulas for renewable energy conversion in 1-A of CDM small-scale methodologies. E BL,Ren,y = Σi EGi,y/(1-l) Where: E BL,Ren,y : Annual energy baseline of renewable energy consumption (kWh) Σi : The sum over the group of i renewable energy technologies : The estimated annual output of the renewable energy technologies of the group of i EGi,y renewable energy technologies installed (kWh) l : Average technical distribution losses (20%) ¾Based on the above formula, the baseline emissions per Club are calculated. Paragraph 9 of the baseline CO2 emissions calculation formula in 1-A of the methodologies is applied. BECO2,y = EBL,Ren,y × EF CO2 Where: BECO2,y EF : CO2 emissions (kg-co2) in the baseline in year y : CO2 emissions factor of diesel fuel (0.8 kg CO2-e/kWh) Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 22 4-3. Additionality ¾NM073 under deliberation proposes new additionality tests for rural electrification projects. According to the proposal, since Kenya is classified as a Low Income Country (LIC) and its rural electrification rate is below 12%, the country has additionality. ¾In addition, in case of introducing a 10 kW system into other Hotels within the range of 500 hotels, 10 kW systems will amount to less than 5 MW. Then, the project is eligible for the exemption of additionality tests of micro scale CDM. ¾If a project of this size were first installed, it would be able to win international understanding without demonstrating additionality in detail. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 23 4-3. Monitoring ¾Monitoring methodologies will be examined in terms of measurement, reporting, verification, and methodology validation measurement. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 24 CONTENTS 1.Overview of the Survey 2.Feasibility of Introducing Energy saving Technology and Renewable Energy into MPATA SAFARI CLUB 3.Survey of Current Green Electrification at Other Hotels 4.MRV Methodology When Renewable Energy Is Introduced to Hotels 5.Feasibility of Bilateral Offset Credit Mechanism 6.Future Issues and Project Plan Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 25 5-1. Conclusions ¾Kenya has been promoting NAMA to make up CDM. ¾Thus, BOCM should be built up along the Kenyan NAMA policy. ¾Although Kenya is not an LDC, its rural electrification rate is similar to that of an LDC. ¾Present CDM is unable to grasp the needs of such countries. ¾Partners of BOCM should be countries which are non-LDC but LIC or LMIC. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 26 5-2. Recognition of the present CDM ¾The 3 problems of CDM are recognized not only by Kenya but also by the international community. 1. it takes too long to obtain approval 2. paper work is complicated, including data collection; 3. application is expensive. ¾One of the problems specific to Kenya is; – targets of EU-ETS offset are, in principle, limited to LDC from 2013. Since Kenya is not an LDC, the momentum to generate CDM projects in Kenya is expected to decline. ¾In addition, infrastructure problems are common to African countries. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 27 5-3. NAMA; the climate change policy of Kenya ¾Kenya is determined to promote NAMA as a mitigation policy for climate change in the future. ¾In the chart (right), shows 9 elements of Kenya National Climate Change Action Plan. ¾(4) Mitigation planning and actions includes NAMA and REDD+. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. http://www.environment.go.ke/wp-content/uploads/2011/12/KENYACLIMATE-CHANGE-AP-NATIONAL-ADAPTATION.pdf 28 5-4. NAMA; the mitigation policy of Kenya ¾The Government of Kenya puts special emphasis on the following considerations in the identification of NAMAs: • Priority mitigation actions in key economic sectors with demonstrated deviation from business as usual emission levels • Policy measures and tools aimed at implementing NAMAs and in meeting the objectives of the country’s sustainable development strategy • The co-benefits of implementing mitigation actions • Support needed for the implementation of NAMAs (costed NAMAs) • Putting in place a national system for measurement, reporting and verification. http://www.environment.go.ke/wp-content/uploads/2011/12/KENYA-CLIMATE-CHANGE-AP-NAMAS-and-REDD+.pdf ¾We should propose the BOCM as it complements NAMA policy of Kenya. ¾ Efforts are needed to develop additional climate change measures for the tourism business, the major industry in Kenya, to NAMA in order for Hotels to seek generation of bilateral offset credit. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 29 5-5. Sugestion; how we develop BOCM Complement Nama ¾We should propose the BOCM as it complements NAMA policy of Kenya. ¾ Efforts are needed to develop additional climate change measures for the tourism business, the major industry in Kenya, to NAMA in order for Hotels to seek generation of bilateral offset credit. Non-LDC, but LIC or LMIC as a partner of BOCM ¾Non-LDC, but still considered as Low Income Countries (LIC) or Lower Middle Income Countries (LMIC) in Africa and other parts of the world have the problem. Finding purchasers of credits after 2013 will not be easy. ¾Thus, non-LDC but LIC or LMIC are considered ideal partners to promote negotiations over BOCM. ¾In Africa, the list below shows the 12 non-LDC but LIC or LMIC Cameroon, Cape Verde, Congo, Rep., Cote d'Ivoire, Egypt, Arab Rep., Ghana, Kenya, Morocco, Nigeria, Swaziland, Zimbabwe Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 30 CONTENTS 1.Overview of the Survey 2.Feasibility of Introducing Energy saving Technology and Renewable Energy into MPATA SAFARI CLUB 3.Survey of Current Green Electrification at Other Hotels 4.MRV Methodology When Renewable Energy Is Introduced to Hotels 5.Feasibility of Bilateral Offset Credit Mechanism 6.Future Issues and Project Plan Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 31 6-1. Future Issues ¾These are future issues of this project; 1. Continuous survey at the Club 2. Further Study of other Hotels 3. Setting up an organizing body 4. Approach to the Government Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 32 6-2. Future Issues Continuous survey at the Club ¾We would like to introduce a PV generation model system to the Club on an experimental basis and conduct additional surveys at the facilities. – a 5 to 10 kW-size PV generation model system primarily made in Japan will be installed. – This model system will collect data covering actual costs (initial investment cost, running cost), electricity generated, amount of solar radiation and meteorological data. ¾Concerning wind power generation, we will survey patterns of wind throughout the year while bearing in mind the installation of small wind generators in future. ¾Concerning surveying the possibilities for energy saving, electricity meters will be installed on the generators, major electric equipment and guest rooms of the Club. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 33 6-3. Future Issues Further Study of other Hotels ¾A local survey of hotels that may introduce renewable energy, etc. in the future shall be continued. ¾First, a feasibility study for introducing renewable energy into hotels and other accommodations located in the Masai Mara National Reserve will be promoted. ¾We would like to survey the present conditions of hotels and lodges that are located in other national reserves and parks and conduct a feasibility study in anticipation of introducing renewable energy into those hotels and lodges. ¾We also would like to formulate a model plan targeting tent lodges, the largest segment of the market. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 34 6-4. Future Issues Setting up an organizing body ¾As discussed earlier, if a 5- to 10-KW renewable energy system is introduced into 2,500 Hotels, the amount of credits generated will reach from 10,625 to 21,250 tons. ¾Under the current market price, if the credits per ton can be sold at 10 euros (=1,200 yen), the total credits obtained would be from 12,900,000 yen to 25,800,000 yen (1 yen = 1 KSh). ¾Concerning wind power generation, we will survey patterns of wind ¾Thus, an agreement of the Hotels be concluded prior to throughout the year with whileeach bearing in mind theshall installation of small wind payment ofinafuture. portion of the amount to each of the Hotels. generators ¾A body shall be set up (or entrusted) that promotes some other method (offering low-interest finance or appropriating such portion to premiums on the insurance for quality assurance of panels). Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 35 6-5. Future Issues Approach to the Government ¾We would like to share information on NAMA with the Kenyan Government to utilize BOCM as early as possible. ¾We would like to approach the Ministry of Tourism and the Kenya Tourist Board (KTB) in the coming survey and continue to survey the actual situations of other hotels in Kenya. ¾We also seek the possibility to develop climate change measures in the tourism. If such measures would be added in the list of NAMA, this project could create credits under the BOCM. Copyright © 2011 NTT DATA Institute of Management Consulting, Inc. 36