Chiclayo Rice Hull Power Plant

The objective of the Chiclayo Rice-Hull Fired Cogeneration Project is to generate electricity by burning rice hulls, a biomass fuel. The project will sell electricity to rice mills and to agricultural growers and currently off-grid pumping customers at below the current price they pay for diesel generated and grid based energy. This would result in a reduction in global greenhouse gas and local particulate matter levels, resulting in improved local health conditions.

The project will use rice hulls from a cluster of 25 – 30 rice mills, which currently process over 500,000 metric tons per year of rice. The rice hulls will be transported to a centralized location, within an average of 4 km of each mill, and used as fuel in specialized boilers to generate steam for electric power production. The initial stated aggregate power output from the plant will be 9.2 MW. The project proposal consider the possibility to increase up to 15 MW the mentioned aggregate power output.

Baseline Scenario

Which emissions are the proposed Clean Development Mechanism CDM project displacing?
The Project will displace mainly CO2 emissions produced by the operation of 125 water pumps diesel based. These diesel pumps use an average of tree gallon per hour working 300 days per year.
What would the future look like without the proposed CDM project?
Business as usual practices will continue. This means water pumps using diesel as fuel which currently could use more than 1.35 million gallons of diesel annually, and agricultural growers with electricity supply price that don’t allow them to processing/conservation his production to obtain added value.
What would the estimated total greenhouse gas (GHG) reduction be with the project?
For a maximum 21 years period total GHG reduction are estimated in 312,726 tCO2e.

Current Status

Earliest project start date
II semester 2006
Estimate of time required before becoming operational
Two year
What is the project lifetime?
25 years
Current status or phase of the project eg: which of the following phases have been completed:
• The feasibility study is finished
• The environmental impact studies is under preparation
• Financing negotiations are not closed because CleanTech Fund will be the main investor.
• Project sponsors/promoters Monder SAC from Lima Perú and Econergy International Corporation from Boulder Colorado USA and Lambayeque’s Rice Mills Association have sign a Letter of Intent to became partners through the conformation of the company «Agroindustrias y Energía del Norte SAC» (AGRENSA) which will became owner of the project, this must be ready in May 2005.

Estimated Emission Reductions

Annual: an average of 14,891 tCO2e per year.

• Up to and including 2012: 89,350 tCO2e
• Up to a period of 10 years: 148,917 tCO2e
• Up to a period of 7 years: 104,242 tCO2e
• Up to a period of 14 years: 208,484 tCO2e

Project Benefits

• Grid Diversification. Diversification of the power system away from fossil fuels
• Reduced Local Pollution. This project will also improve regional air quality by reducing N2O,SO2 (possibly) and particulate matter (PM) emissions associated with the burning of rice husks in open pits.
• Reduced Global Emissions. Avoidance of emissions from fossil fueled power plants, probably oil fired boilers, natural gas turbines, and/or natural gas combined-cycle power plants
• Reduced price of electricity. The rice mills are expected to be able to reduce their electricity prices by approximately 10-20%.
• Increased foreign and local investment. By showing the local and international community that independently operated renewable energy projects can be developed and managed profitably, this project should promote the further development of renewable energy technologies, further promoting foreign direct investment in environmentally sustainable projects in Peru.
• The new technology brought by the project will train technical workers in sound technologies and in the same time create conscience of responsible environmental management.
• The project would become the company autonomous on energy and would left enough bagasse to satisfy the demand of the paper factory close to the sugar refinery.

Project Participant and Financing

Total project cost estimate:
• Fixed capital: US$ 12,945,000
• Variable start up cost: US$ 2,218,464
• Interest during construction: US$ 779,911
• Contingency: US$ 682,356
• Total project costs: US$ 16,625,732

Sources of finance to be sought or already identified:
• Equity (30%): US$ 4,987,720
- Clean Tech Fund US$ 3,000,000
- Others US$ 1,987,720
• Debt (70%): US$ 11,638,012
Note: The finance share structure could be changed in accordance to the interest/participation of new investors
• Carbon finance contribution sought: As much as we can have in advance.

Contact Information: