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Guilherme Corrêa AbreuLuiz Antônio RossiTsutomu Morimoto

Optimization and Co-Generation of Energy from Steel Making

Process

CDM Methodologies Process Approval

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Responsible Work Team

Companhia Siderúrgica de Tubarão

(coordination)

(Technical support in the project development)

(Validation Process)

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The CDM Projects

SludgeSludgePumpsPumps

VenturiVenturiPumpsPumps

Steel Making Gas (LDG) recovery for electric energy generation => Increasing the generation.

Electric energy consumption reduction at Steel Making Plant => Reduction of the consumption.

Total of 330.000 tCO2 in 07 years.

Electric energy consumption reduction

LD gas recovery / Power Plant #4

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The Proposed Methodologies Baseline Scenario: The future thermal participation on the grid expansions. The hydrologic conditions for hydro energy generations.

Validation Process initiated at September 2003 (DNV). New Methodologies: NM0059: Energy co-generation from steel making gas recovery at Brazil. NM0064: Electric energy consumption reduction in steel making process at Brazil.

Submission for Meth Panel: June 24, 2004. Public comments: Jul 16 until August 05. Meth Panel recommendation: Nov. 08~10.

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Meth Panel Considerations Final Recommendation (NM0059 and NM0064): Not to approve the

proposed methodologies. Additionality not clear and not rigorously supported (additionality test). Proposed threshold (<50%) too high to establish “non common practice in

the sector”. Necessary an Investment Analysis to support additionality through Barriers

Analysis. Necessary to use the energy operating margin AND built margin. Baseline Scenario not well defined (only one baseline scenario is

considered). Necessary of leakages expansion assessment.

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Project Participants Comments

Technical questions and procedures questions have arose after Final Recommendation.

Additionality test, that has been asked for, was published by Meth Panel on 11th meeting July 09, 2004, therefore after the submission.

Even being published after the project submission, it is not clear in the additionality test (MP 11th meeting) that it is necessary an Investment Analysis AND Barriers Analysis.

The whole project including proposed methodologies and the additionality had been evaluated by DNV during the Validation Process, and was considered in accordance with Kyoto Protocol demands.

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Project Participants Comments

Differences of individual analysis by experts on several points (ex. NM0059 with controversial positions between the experts related to the baseline establishment).

No possibility for any clarifications by project participants, even this phase is foreseen on Meth Panel procedures. Most of the technical aspects pointed by the experts could be clarified in case of explanations by project participants.

No support on the establishment why the “proposed threshold is too high”.

Participation of an expert (Ricardo Esparta) not in accordance with Meth Panel procedures regarding the total impartiality on the process.

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Thank you for your attention !!

www.cst.com.br

Guilherme Corrêa Abreu

Environmental Specialist

gabreu@cst.com.br