REPLACEMENT OF EXISTING LUMINAIRES WITH LED LIGHTING LUMINAIRES IN SEVERAL BUILDINGS ACROSS 12 TOWN COUNCILS IN SINGAPORE.
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PROJECT DESCRIPTION: VCS Version 3
REPLACEMENT OF EXISTING
LUMINAIRES WITH LED LIGHTING
LUMINAIRES IN SEVERAL BUILDINGS
ACROSS 12 TOWN COUNCILS IN
SINGAPORE.
Document Prepared By DTZ Facilities & Engineering (S) Limited
Project Title Replacement of existing luminaires with LED lighting luminaires in several buildings
across 12 Town Councils in Singapore.
Version 01
Date of Issue 01-11-2015
Prepared By DTZ Facilities & Engineering (S) Limited
Contact Thirumalavan Panchaksharam ( Manager)
Energy & Sustainability
DTZ Facilities & Engineering (S) Limited
Blk 750A Chai Chee Road, #05-01 Technopark@Chai Chee, Singapore 469001
Tel: +65 6876 6263 / Fax: +65 6876 6496 / thiru.p@dtz.com / www.dtz.com
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PROJECT DESCRIPTION: VCS Version 3
Table of Contents
1 Project Details .............................................................................................................................. 3
1.1 Summary Description of the Project .......................................................................................... 3
1.2 Sectoral Scope and Project Type ............................................................................................. 3
1.3 Project Proponent .................................................................................................................... 4
1.4 Other Entities Involved in the Project ........................................................................................ 4
1.5 Project Start Date ..................................................................................................................... 4
1.6 Project Crediting Period............................................................................................................ 4
1.7 Project Scale and Estimated GHG Emission Reductions or Removals ...................................... 4
1.8 Description of the Project Activity ............................................................................................. 5
1.9 Project Location ....................................................................................................................... 6
1.10 Conditions Prior to Project Initiation ...................................................................................... 7
1.11 Compliance with Laws, Statutes and Other Regulatory Frameworks ..................................... 8
1.12 Ownership and Other Programs ........................................................................................... 8
1.12.1 Right of Use ..................................................................................................................... 8
1.12.2 Emissions Trading Programs and Other Binding Limits ..................................................... 8
1.12.3 Other Forms of Environmental Credit ................................................................................ 8
1.12.4 Participation under Other GHG Programs ......................................................................... 8
1.12.5 Projects Rejected by Other GHG Programs ...................................................................... 8
1.13 Additional Information Relevant to the Project ....................................................................... 8
2 Application of Methodology ............................................................................................................ 9
2.1 Title and Reference of Methodology ......................................................................................... 9
2.2 Applicability of Methodology ..................................................................................................... 9
2.3 Project Boundary.................................................................................................................... 12
2.4 Baseline Scenario .................................................................................................................. 13
2.5 Additionality............................................................................................................................ 13
2.6 Methodology Deviations ......................................................................................................... 18
3 Quantification of GHG Emission Reductions and Removals ........................................................... 18
3.1 Baseline Emissions ................................................................................................................ 18
3.2 Project Emissions ................................................................................................................... 18
3.3 Leakage ................................................................................................................................. 18
3.4 Net GHG Emission Reductions and Removals ....................................................................... 18
4 Monitoring .................................................................................................................................. 18
4.1 Data and Parameters Available at Validation .......................................................................... 18
4.2 Data and Parameters Monitored ............................................................................................. 18
4.3 Monitoring Plan ...................................................................................................................... 18
5 Environmental Impact.................................................................................................................. 18
6 Stakeholder Comments ............................................................................................................... 18
APPENDIX X: ..................................................................................................... 19
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PROJECT DESCRIPTION: VCS Version 3
1 PROJECT DETAILS
1.1 Summary Description of the Project
Description of Technology/Measures:
The proposed Project Activity (Herein after “The Project”) involves demand side energy efficiency
measures in building lighting systems through replacement of existing luminaires with more
energy efficient “Light Emitting Diodes” (LEDs) lighting luminaires in the corridors, staircases and
void decks of several existing buildings located in 12 Town councils nationwide.
Location of the Project:
The 12 Town Councils are as follows:
• Ang Mo Kio Town Council • Nee Soon Town Council
• Bishan – Toa Payoh Town Council • Pasir Ris – Punggol Town Council
• Choa Chu Kang Town Council • Sembawang Town Council
• East Coast Town Council • Tanjong Pagar Town Council
• Holland – Bukit Panjang Town Council • Tampines Town Council
• Marine Parade Town Council • West Coast Town Council
Explanation of Generation of GHG Emission Reduction/Removals:
GHG emission reduction/removals are achieved through replacement of existing luminaires with
more energy efficient “Light Emitting Diodes” (LEDs) lighting luminaires common areas of several
existing buildings
Brief Description of Baseline:
The baseline scenario is the same as before the project implementation which means the
continuation of using existing luminaires.
Estimation of Emission Reduction
Description Value Unit
Estimation of annual average emission reduction 14,587 tCO2e
Total crediting period 10 -
Estimation of total emission reduction throughout the crediting period 145,870 tCO2e
1.2 Sectoral Scope and Project Type
Sectoral scope : 3. Energy Demand
Category : AMS-II.C.: Demand-side energy efficiency activities for specific technologies
Version : 14
Validity : 03 August 2012 onwards
v3.2 3PROJECT DESCRIPTION: VCS Version 3
1.3 Project Proponent
Organization name DTZ Facilities & Engineering (S) Limited
Contact person Thirumalavan Panchaksharam
Title Assistant Manager
Address Blk 750A Chai Chee Road, #05-01 Technopark@Chai Chee, Singapore 469001
Telephone +65 6876 6263
Email thiru.p@dtz.com
Organization name Holland-Bukit Panjang Town Council
(Coordinating town council for the 14 PAP town councils)
Contact person Jack Lee
Title Property Manager
Address Blk 256 Bangkit Road, #01-71 Singapore 670256
Telephone +65 6416 7922
Email jacklee@hbptc.org.sg
1.4 Other Entities Involved in the Project
Not Applicable.
1.5 Project Start Date
01 January 2016
1.6 Project Crediting Period
01 January 2016 – 31 December 2025 (10 Years 0 Months).
1.7 Project Scale and Estimated GHG Emission Reductions or Removals
Project Scale
Project
Small project
Year Estimated GHG emission reductions or removals (tCO2e)
2016 13,158
2017 13,158
2018 13,158
2019 13,158
v3.2 4PROJECT DESCRIPTION: VCS Version 3
2020 13,158
2021 13,158
2022 13,158
2023 13,158
2024 13,158
2025 13,158
Total estimated ERs 131,580
Total number of crediting years 10
Average annual ERs 13,158
1.8 Description of the Project Activity
The proposed small scale project activity will involve the replacement of existing light profile with
energy efficient LED luminaires. An LED light is a solid-state luminaires that uses light-emitting
diodes (LEDs) as the source of light. Several LEDs are grouped together in a single fixture to
achieve the appropriate light output for particular application. Each luminaires shall be provided
with its own inbuilt electronic control gear. The electronic control gear shall be placed in its own
housing and supply cable connected via certified plug and socket connector.
The project will involve replacing of 668,723 existing luminaires by LED luminaires as shown in
table below:
S/N Existing Light New LED Luminaire
1 2 ft T8 Fluorescent Light To be replaced with 2 ft LED Luminaire
2 2 ft T5 Fluorescent Light To be replaced with 2 ft LED Luminaire
3 Staircase Half-Landing To be replaced with 2 ft LED Luminaire with motion sensor
4 Staircase Full Landing To be replaced with 2 ft LED Luminaire
5 4 ft T8 Fluorescent Light To be replaced with 4 ft LED Luminaire
6 4 ft T5 Fluorescent Light To be replaced with 4 ft LED Luminaire
7 Decorative Light (PL, PLC, 2D) Recessed LED Down light
8 Recessed Down light Recessed LED Down light
Following is the technical specifications of LED luminaire:
Parameter 2 ft LED 4 ft LED Recessed LED
System power ≤ 10W ≤ 20W ≤ 10W
Power factor ≥ 0.9 ≥ 0.9 ≥ 0.9
Colour Rendering Index (CRI) ≥ 65 ≥ 75 ≥ 65
Luminous Flux ≥ 700 lm ≥ 600 lm ≥ 1400 lm
The baseline scenario is the same as before the project implementation which means the
continuation of existing luminaires.
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1.9 Project Location
As provided under section 1.1, the project is implemented in HDB Blocks located in 12 Town
Councils in Singapore. The GPS location of the 12 Town Councils offices are as follows:
1. Ang Mo Kio Town Council − 1°21'52.8" N 103°50'55.0" E
2. Bishan – Toa Payoh Town Council − 1°20'15.1" N 103°50'44.7" E
3. Choa Chu Kang Town Council − 1°23'06.4" N 103°44'44.5" E
4. East Coast Town Council − 1°19'35.8" N 103°55'51.8" E
5. Holland – Bukit Panjang Town Council − 1°22'44.8" N 103°46'22.2" E
6. Marine Parade Town Council − 1°18'19.3" N 103°54'57.0" E
7. Nee Soon Town Council − 1°26'10.0" N 103°50'10.0" E
8. Pasir Ris – Punggol Town Council − 1°24'14.2" N 103°54'28.9" E
9. Sembawang Town Council − 1°25'48.1" N 103°46'30.4" E
10. Tanjong Pagar Town Council − 1°16'60.0" N 103°49'03.7" E
11. Tampines Town Council − 1°20'40.8" N 103°56'42.9" E
12. West Coast Town Council − 1°18'51.6" N 103°45'52.6" E
Figure 1: Location of Singapore in World Map
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Figure 2: Boundaries of 12 Town Councils (underlined in red) in Singapore Map
1.10 Conditions Prior to Project Initiation
Prior to project implementation, the baseline is “Continue to use the existing luminaires in all
residential blocks”. The baseline emission factor was established by Energy Market Authority
(EMA) of Singapore by using the “Tool to calculate the emission factor for an electricity grid
system”. The emission factor for electricity grid system is calculated ex ante basis and the value
is 0.4199 tCO2/MWh1.
Singapore has common operating hours (12 hours – Conservatively 7pm to 7am) for all the
buildings located in the Town Council. Therefore, the same operating hours assumed for the LED
luminaires.
1
http://www.ema.gov.sg/statistic.aspx?sta_sid=20140729MPY03nTHx2a1
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1.11 Compliance with Laws, Statutes and Other Regulatory Frameworks
Not Applicable
1.12 Ownership and Other Programs
1.12.1 Right of Use
DTZ Facilities & Engineering (S) Limited has the rights to manage this project and thereby the
VER credits. Also, DTZ is the VCS project developer for this project
A contract has been signed between Town Councils and DTZ Facilities & Engineering (S) Limited
could be substantiate the ownership of this project.
1.12.2 Emissions Trading Programs and Other Binding Limits
Not applicable.
1.12.3 Other Forms of Environmental Credit
Not applicable.
1.12.4 Participation under Other GHG Programs
Not applicable.
1.12.5 Projects Rejected by Other GHG Programs
Not applicable.
1.13 Additional Information Relevant to the Project
Eligibility Criteria
This is not a grouped project and thereby no eligibility criteria.
Leakage Management
Not applicable.
Commercially Sensitive Information
Not applicable.
Further Information
Not applicable.
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2 APPLICATION OF METHODOLOGY
2.1 Title and Reference of Methodology
Methodology Version
AMS-II.C; Demand-side energy efficiency activities for specific technologies
14
(https://cdm.unfccc.int/methodologies/DB/QLHVO5QIRIDVE6092VXPRAG9VZIOZP)
Tools & Guidelines Version
Tool to calculate the emission factor for an electricity system 4.0
Guideline on the demonstration of additionality of small-scale project activities. 9.0
Guidelines for Sampling and Surveys for CDM Project Activities and Programme of
3.0
Activities
2.2 Applicability of Methodology
No Applicability as per AMS-II.C VCS-PD Applicability
1 This methodology comprises activities that The project will involve supply and
involve the installation of new, energy- installation of Light Emitting Diode (LED)
efficient equipment (e.g. lamps, ballasts, lighting luminaires as a replacement to
refrigerators, motors, fans, air conditioners, existing luminaires in corridors, void decks
pumping systems, and chillers) at one or and staircases of several existing HDB
more project sites. Retrofit as well as new blocks in following Town Councils in
construction (Greenfield) projects are Singapore.
included under this methodology. In the
case of new construction projects, a The Town Councils are:
stepwise approach is indicated for 1. Ang Mo Kio Town Council
determining the baseline under paragraph 2. Bishan – Toa Payoh Town Council
19 of version 17.0 of the general guidelines 3. Chua Chu Kang Town Council
to SSC CDM methodologies. 4. East Coast Town Council
5. Holland – Bukit Panjang Town Council
6. Marine Parade Town Council
7. Nee Soon Town Council
8. Pasir Ris – Punggol Town Council
9. Sembawang Town Council
10. Tanjong Pagar Town Council
11. Tampines Town Council
12. West Coast Town Council
Baseline monitoring data for existing
buildings are participating in this proposed
project is provided by the project
implementer.
2 This methodology is only applicable if the The light output (in terms of lux level) of
service level (e.g. rated capacity or output) every replaced lighting equipment will not
of the installed, project energy-efficient be significantly smaller (maximum -10%) or
equipment is between 90% and 150% of the larger (maximum +50%) than the baseline.
service level of the baseline equipment.
Examples of service levels are light output The primary aim of this PROJECT
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No Applicability as per AMS-II.C VCS-PD Applicability
for lighting equipment, water output and ACTIVITY is reducing the energy
temperature for water heating systems, and consumption by replacing of existing
rated thermal output capacity of air luminaires with various rated capacity. The
conditioners. The relationship of the service emission reduction will be achieved by
level of the project energy-efficient installing energy efficient luminaires with
equipment to the baseline equipment can very low rated capacity. Even the rated
be one to one replacement (e.g. capacity varying, light output is the more
replacement of inefficient refrigerator with important criteria to fulfil the baseline
new and efficient refrigerator) or many-to- requirement. Therefore, the lux level of
one (e.g. replacement of small multiple each lights considered under this
chillers with a central chiller plant). In the applicability.
latter case, the service level of the project
and baseline can be compared on an From the baseline and project lux
aggregate basis. measurement carried out for this project
activity concluded that the change in lux
level is complying with the criteria
established under this applicability.
Supporting Documents shall be provided:
1. Baseline lux level measurement of
sampling blocks
2. Project lux level measurement of
sampling blocks
3 Requirements pertaining to the baseline of This applicability condition is not
the retrofit projects and projects involving applicable for this project activity as the
capacity increase are indicated in proposed project does not involve use of
paragraphs 20 to 21 in the above cited refrigerant.
general guidelines to SSC CDM
methodologies. In the event that project
output in year y is greater than the average
historical output (average of the three most
recent years prior to the project
implementation2) and the demonstration of
the baseline for the incremental capacity is
not undertaken, the value of the output in
year y is capped at the value of the
historical average output level.
4 If the energy-efficient equipment contains This applicability condition is not
refrigerants, then the refrigerant used in the applicable for this project activity as the
project case shall have no ozone depleting proposed project does not involve use of
potential (ODP). refrigerant.
5 This methodology credits emission This methodology credits emission
reductions only due to the reduction in reductions only due to the reduction in
electricity and/or fossil fuel consumption electricity consumption from use of more
from use of more efficient equipment. efficient equipment. There will be no
However, the calculation of project refrigerant involve in the proposed project.
emissions shall include any incremental
emissions, as compared to the baseline,
associated with refrigerants used in the
project equipment.
2
A maximum of +10% variation is permitted.
v3.2 10PROJECT DESCRIPTION: VCS Version 3
No Applicability as per AMS-II.C VCS-PD Applicability
6 The aggregate energy savings by a single The aggregate energy savings by this
project may not exceed the equivalent of project activity is approximately 31.34
60 GWh per year for electrical end-use GWh/year which is not exceeding the 60
energy efficiency technologies. For fossil GWh/year.
fuel end-use energy efficient technologies,
the limit is 180 GWh thermal per year in fuel Refer Section D.6.3
input.
7 The point in time at which the baseline This is not applicable for Luminaires
equipment and/or systems would have been replacement project as the existing
replaced in the absence of the project luminaires does not have a fixed operational
activity, and thus triggering the requirement lifetime.
for a new baseline scenario, shall be
estimated in a conservative manner using
the “Tool to determine the remaining lifetime
of equipment”. The project activity shall be
considered as one possible baseline
scenario at the end of the useful life of
existing, baseline equipment.
8 The option 1 is selected for this PROJECT
Selection of baseline emission calculation ACTIVITY. The project activity full fill the
method following requirement:
Option 1 – Constant load equipment
The LEDs are constant load equipment.
This option is applicable to retrofit and
Greenfield projects. It applies to equipment The baseline records of power consumption
that requires the same power (kW) to by the existing luminaires have been taken
operate whenever it is energized within during one month period which is more than
specified limits, i.e. is (are) constant load six hours.
equipment.
For historical records of Electrical Power
Demand (ρi) under Paragraph 13:Power
demand of baseline equipment is
determined based on spot-measurement
and/or short-term monitoring data. The
Short-term monitoring should be conducted
for a period of at least six hours.
Option 2 – Variable load device(s),
regression approach
This option is limited to the retrofit of
existing equipment and does not apply to
Greenfield projects. It applies to baseline
equipment for which the rate of energy
consumption, demand (kW), varies in
response to independent variable(s) such
as weather. An example is cooling
equipment used to condition an office space
where demand changes with outdoor dry
bulb and wet bulb temperatures, solar gain
and office occupancy. A mathematical
function is developed, using regression
techniques, to determine baseline energy
v3.2 11PROJECT DESCRIPTION: VCS Version 3
No Applicability as per AMS-II.C VCS-PD Applicability
consumption as a function of the relevant
independent variable(s). The independent
variables are measured during the crediting
period and used in the regression function
to predict baseline energy consumption
throughout the crediting period.
Option 3 – Production efficiency/specific
energy consumption approach
1. This option does not apply to Greenfield
projects. This option is only applicable if the
ratio of energy output to energy input for the
baseline equipment can be shown to not be
variable over the range of outputs
experienced during the crediting period.
2. The baseline is calculated by using
specific energy consumption per unit of
output in the baseline multiplied by the
output in project year y multiplied by the
emission factor for the electricity displaced.
This option can only be used where
comparable conditions for the output in the
baseline and project can be established.
For example, in the specific case of a water
pumping system comparable conditions can
be established by one of the options below:
a. Show that average baseline water flow
rate (discharge) is within ±10% of the
flow rate during the project;3 or
b. Choose the nameplate head and
discharge specifications of the baseline
pump and corresponding power/energy
consumption (weighted average values
can be used when pumps are operated
in parallel) for a conservative estimate of
EER.
2.3 Project Boundary
Source Gas Included? Justification/Explanation
Power Plants serving CO2 Yes Major Source of emissions
Baseline
electricity to national CH4 No Minor Source and thereby excluded
grid
N2O No Minor Source and thereby excluded
3
Use three years historic data. For recent facilities (PROJECT DESCRIPTION: VCS Version 3
Source Gas Included? Justification/Explanation
Other No Minor Source and thereby excluded
Power Plants serving CO2 Yes Major Source of emissions
electricity to national No
Project
CH4 Minor Source and thereby excluded
grid
N2O No Minor Source and thereby excluded
Other No Minor Source and thereby excluded
PROJECT BOUNDARY
POWER PLANTS LED LIGHTS AT
RESIDENTIAL
BLOCKS
SINGAPORE
POWER GRID
2.4 Baseline Scenario
As per the Project Activity, the baseline scenario is “Continue to use the existing luminaires in all
blocks”. The baseline emission factor was established by Energy Market Authority (EMA) of
Singapore by using the “Tool to calculate the emission factor for an electricity grid system”. The
emission factor for electricity grid system is calculated ex-ante basis and the value is 0.4199
tCO2/MWh.
Singapore has common operating hours (12 hours – Conservatively 7pm to 7am) for all the
buildings located in the Town Council. Therefore, the same operating hours assumed for the LED
luminaires.
2.5 Additionality
In accordance with the Guidelines on the demonstration of additionality of small-scale project
activities (EB 68, Annex 27, Version 9) guidelines and non-binding best examples to
demonstrate additionality for SSC project activities (EB 35, Annex 34), it is required to
v3.2 13PROJECT DESCRIPTION: VCS Version 3
demonstrate how the project activity (or the emission reduction) would not have occurred in the
absence of the CDM project activity due to at least one of the following barriers.
• Investment barrier
• Technological barrier
• Barrier due to prevailing practice
• Other barriers
Of the indicated list of barriers, the investment barrier is chosen to demonstrate the financial
unattractiveness of the project activity. Below it is demonstrated that the Internal Rate of Return
on the equity (equity IRR) is lower than the benchmark.
Demonstration of Investment Barrier
Assigning the Assessment Period:
The assessment period for calculation of IRR have been described in line with section I: General
issues in calculation and presentation of “Guidelines on the assessment of investment analysis”
(version 5), Annex 5, EB 62, paragraph 3 states:
“The period of assessment should not be limited to the proposed crediting period of the CDM
project activity. Both project IRR and equity IRR calculations shall as a preference reflect the
period of expected operation of the underlying project activity (technical lifetime), or – if a shorter
period is chosen – include the fair value of the project activity assets at the end of the
assessment period. In general a minimum period of 10 years and a maximum of 20 years will be
appropriate. The IRR calculation may include the cost of major maintenance and/or rehabilitation
if these are expected to be incurred during the period of assessment. Project participants are
requested to justify and DOEs are requested to validate the appropriateness of the period of
assessment in the context of the underlying project activity, without reference to the proposed
CDM crediting period.”
The technical lifetime of the baseline and proposed project is 11.4 years4. Hence, the appropriate
period of assessment considered for this project is 12 years which falls into a general appropriate
period of 10 to 20 years.
Selection of Type of IRR and Benchmark:
The benchmark has been chosen in line with section IV: Selection and Validation of Appropriate
Benchmarks of “Guidelines on the assessment of investment analysis” (version 5), Annex 5, EB
62 as follows:
Paragraph As per guidelines As per the project case
In cases where a benchmark approach is This guidance on the Assessment
used the applied benchmark shall be of Investment analysis allows the
12 appropriate to the type of IRR calculated. project proponent to use IRR as the
Local commercial lending rates or weighted financial/economic indicator. In line
average costs of capital (WACC) are with that, the project proponent has
4
Based on 50,000 hours operational life span of LEDs will be operated for average of 12 hours per day
v3.2 14PROJECT DESCRIPTION: VCS Version 3
Paragraph As per guidelines As per the project case
appropriate benchmarks for a project IRR. chosen equity IRR to demonstrate
Required/expected returns on equity are the additionality.
appropriate benchmarks for equity IRR.
Benchmarks supplied by relevant national There is no benchmark established
authorities are also appropriate if the DOE by the Government of Singapore for
can validate that they are applicable to the energy efficiency projects.
project activity and the type of IRR
calculation presented
In the cases of projects which could be
developed by an entity other than the
project participant the benchmark should be
The project is developed by the
based on parameters that are standard in
project participant (who borne the
the market. The DOE’s validation of the
13 100% of investment and project
benchmark shall also include its opinion on
cost) and this may not appropriate
whether a company-specific benchmark or
for this underlying project.
a benchmark based on parameters that are
standard in the market is suitable in the
context of the underlying project activity.
Internal company benchmarks/expected
returns (including those used as the
expected return on equity in the calculation
of a weighted average cost of capital -
WACC), should only be applied in cases
where there is only one possible project
developer and should be demonstrated to
have been used for similar projects with
similar risks, developed by the same There are many project developers
company or, if the company is brand new, who developed the same kind of
would have been used for similar projects in projects in Singapore. Therefore,
14
the same sector in the country/region. This internal benchmarks/expected
shall require as a minimum clear evidence returns are not applicable for this
of the resolution by the company’s Board project.
and/or shareholders and will require the
validating DOE to undertake a thorough
assessment of the financial statements of
the project developer – including the
proposed WACC – to assess the past
financial behavior of the entity during at
least the last 3 years in relation to similar
projects.
If the benchmark is based on parameters
that are standard in the market, the cost of Due to unavailability of benchmark
equity should be determined either by: (a) details in Singapore, the project
selecting the values provided in Appendix proponent is chosen the default
A; or by (b) calculating the cost of equity value (table in Appendix A) for
using best financial practices, based on energy efficiency/demand group
15
data sources which can be clearly validated project in Singapore.
by the DOE, while properly justifying all
underlying factors. The values in the table The equity IRR benchmark selected
in Appendix A may also be used, as a for energy demand group project in
simple default option, if a company internal Singapore is 10.5%
benchmark is used.
The details of benchmark are given below:
v3.2 15PROJECT DESCRIPTION: VCS Version 3
Project Developer Investment Decision Date Selected Benchmark
City Developments Limited 29th November 2013 10.5%
Project Cost:
The project cost incurred by the project promoters is SGD 50 million for the supply and
installation of LED Luminaires at common areas of residential blocks located in 12 Town councils.
The estimated project cost considered in the financial indicator calculation is based on the price
as indicated by the supplier and publicly available data which were available during decision
making time.
Key financial details of proposed project during the financial decision made:
Financial project details Unit Values Reference
Electricity tariff SGD/kWh 0.2608 www.singaporepower.com.sg
Key financial assumptions made:
Financial project details Unit Values Reference
Yearbook of Statistics Singapore
Expected inflation in electricity tariff % 3.70
(from 2007 to 2013)
Income tax % 18 Tax value published by the Inland
Revenue Authority of Singapore
Global Service Tax (GST) % 7 (IRAS)
Results of Investment Analysis:
With the above financial data of the project activity and with considered assumptions, the IRR
calculated is as follows:
Details of Post Tax Equity IRR Benchmark
Project Activity
Financial Indicator IRR without CDM (Return on Equity)
Replacement of existing
lights by LED lightings at 12 Equity IRR 8.16% 10.5%
Town Councils
It can be seen from the above analysis that the Post Tax Equity IRR without CDM is lower
than the Benchmark considered in the project activity. Even the CDM benefits included, the
project activity is not financially attractive. Hence project activity was not financially viable. The
financial analysis has been carried out on excel sheets which will be made available for validation
by DOE.
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Results of the sensitivity analysis of base case:
Additionality tool requires demonstrating whether the conclusion regarding the financial
attractiveness is robust to reasonable variations in the critical assumptions. We consider the
project cost, annual energy savings and operating expenses to carry out the sensitivity analysis.
The sensitivity analysis has been carried out considering 20% increase and decrease in these
parameters. The results of the sensitivity analysis are presented as follows:
Equity IRR without CDM Benefits
Variations -20% -10% -5% 0% 5% 10% 20%
Total Investment 18.39% 12.91% 10.46% 8.16% 5.98% 3.90% -0.01%
Annual Savings -1.88% 3.45% 5.87% 8.16% 10.34% 12.45% 16.46%
The results of investment analysis and sensitivity analysis clearly reveals that the proposed
project is “additional” as the expected return from the project activity in investment analysis and
sensitivity analysis does not meet the desired benchmark.
Thus, the explanation presented clearly demonstrates appropriateness of the input values
considered and it demonstrates additionality. This shows that the conclusion regarding the
financial attractiveness of the project is robust and that the project is unlikely to be financially
attractive.
Range of variation in net electricity savings and Investments:
The sensitivity analysis carried out under this section based on the guidelines provided by EB 62,
Annex 5.
v3.2 17PROJECT DESCRIPTION: VCS Version 3
From the above analysis, the electricity savings achieve more than 5% of the actual estimated
savings may help to reach the benchmark. However, the maximum savings estimated based on
the operational criteria and LED specifications. Hence, it is not possible to achieve the savings
more than 5%.
In addition, decrease in more than 5% of project investment helps to achieve the benchmark.
However, the project proponent has already factored in all the costs such as manpower,
equipment cost…etc. which are related to supply and installation of LED luminaires for the 12
Town Councils. Therefore, it is not possible to reduce the investment.
Hence it can be concluded that project activity was financially unattractive and thereby the project
activity is additional.
2.6 Methodology Deviations
There were no methodology deviations and thereby it is not applicable.
3 QUANTIFICATION OF GHG EMISSION REDUCTIONS AND REMOVALS
3.1 Baseline Emissions
3.2 Project Emissions
3.3 Leakage
The proposed project involves installation of brand new LED lights and it was not transferred from
any another activity. Hence, the leakage emission would be zero.
3.4 Net GHG Emission Reductions and Removals
4 MONITORING
4.1 Data and Parameters Available at Validation
4.2 Data and Parameters Monitored
4.3 Monitoring Plan
5 ENVIRONMENTAL IMPACT
6 STAKEHOLDER COMMENTS
v3.2 18PROJECT DESCRIPTION: VCS Version 3 APPENDIX X: v3.2 19
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