«Poechos» Hydropower Project

This run of river project takes advantage of the works in the current Poechos reservoir, and it will be built downstream at the bottom gate of the dam. The plant shall be located close to the Poechos dam, taking advantage of a change of heights of about 40 m, between the level of the water in the reservoir and the level of water in the discharge on the Chira River.
Although the reservoir allows a multi-year regulation of the water, the control of the discharges are managed by the agricultural sector and are programmed according to the irrigation needs, reason why the project will not have facilities to regulate its energy production.
The project has a installed capacity of 15.4 MW and an annual production of energy of 58.5 GWh.

Baseline Scenario

Which emissions are the proposed Clean Development Mechanism CDM project displacing?
«Poechos» project is almost a small scale CDM project and will displace GHG emitted by thermal power plants using diesel, residual (bunker), carbon and natural gas as fuel from the national grid.
What would the future look like without the proposed CDM project?
The new additions in the future to the grid basically will be thermoelectric production with natural gas in combined cycle plants replacing most of the other plants with oil, of all types. National policies, sectoral policies and the new natural gas exploitation «Camisea» particular circumstance foster thermal technology against hydro-developments.
What would the estimated total greenhouse gas (GHG) reduction be with the project?
According to the Consolidated Methodology ACM0002, the World Bank Carbon Finance Business in a study done in December 2004 got a Baseline Emission Factor of 544 tCO2e/gwh. Using that emission factor it is expected that «Poechos» project will displace around 31,878 tCO2e/year which otherwise will be emitted by thermal power with diesel, residual (bunker), coal and natural gas.

Current Status

Earliest project start date
The construction of the project is done. The operation has already started on January 2004.
Estimate of time required before becoming operational
Ii is in operation
What is the project lifetime?
50 years
Current status or phase of the project eg: which of the following phases have been completed:
• Energy and water concession have been already given.
• Financing negotiations are closed
• The construction is finished.
• The project has the host country letter of approval given by the Designated National Authority on CDM – CONAM.
• An Emission Reduction Purchase Agreement (ERPA) is signed with the World Bank Carbon Finance Business on December 2004.

Estimated Emission Reductions

Annual: an average of 31,878 tCO2e

• Up to and including 2012: 255,024 tCO2e
• Up to a period of 10 years: 318,780 tCO2e
• Up to a period of 7 years: 223,146 tCO2e
• Up to a period of 14 years: 446,292 tCO2e

Project Benefits

• 200 jobs during the construction of the power plant and 30 steady jobs
• Communities along the transmission line were given the opportunity to connect to the line. The Project has lately installed a 22.9 KV keys yard to feed 3 small isolated systems: The Lancones system, The Chira system, and a third one that goes into a small population located close to the Ecuadorian border.
• The project will reduce operational costs of the reservoir of Poechos, displacing the current use of diesel power plants and beneficing local farmers.
• The project will support financing education and local technical training.

Project Participant and Financing

Total project cost estimate:
• Development cost: US$ 1,000,000
• Installed cost: US$ 15,000,000
• Other Cost: US$ 500,000
• Total project costs: US$ 16,500,000

Sources of finance to be sought or already identified:
• Equity: US$ 1,700,000
• Debt : US$ 8,500,000 Interamerican Investment Corporation(IIC)
US$ 6,000,000 DEG
• Carbon finance contribution sought: As much as we can have in advance.

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