Comments on the Baglihar Hydropower Project (India)

International Rivers Comments on the Baglihar Proposed CDM Project

1) The name of the project is never given in the PDD so that the identification of the project is unclear. The PDD should be reposted for public comment after information clearly identifying the project is included.

In the PDD only the location of the project is given, the name is not given. Also, the project has two stages, and both are 450 MW. It is not clear from the PDD which stage is being proposed as the CDM project. Developers should be required to give information that is commonly expected for the project to be identified, including the name commonly used to refer to it. The PDD should be reposted for public comment, with the name and stage of the proposed CDM project clearly included.

2) The project start date is incorrect

In the PDD the date of financial closure is given as the project start date. In the Glossary of CDM Terms, the start date of a CDM project activity is defined as “the earliest date at which either the implementation or construction or real action of a project activity begins.” In India it is common for hydro projects to reach financial closure well after construction has begun, and it is extremely unusual for a project that has begun construction not to reach financial closure, even if financial closure comes later than expected causing delays in project completion.

Construction of the project started in 1999.
This is the appropriate project start date.

3) The project is non-additional

It is not believable that a project that started construction in 1999 was only built because of the CDM. There was far too much uncertainty about the CDM at the time.

It is very rare for a hydro project that has started construction to not be completed. So arguments (if they had been given) that the developers needed the CDM for financial closure are also hard to believe and would require, strong evidence. If the developers decide to make this argument minutes from a board meeting of the developers would not suffice.

4) The PDD fails to provide evidence, or even an argument, that the project would not have been built without the CDM

The PDD simply lists barriers, and makes undefended statements that registration under the CDM is necessary for the implementation of the project and helps mitigate project risks. No argument or evidence is given as to the role the CDM has actually played in enabling the project to go forward.

The draft VVM instruction DOEs to “assess and verify the reliability and creditability of all data, rationales, assumptions, justifications and documentation provided by project participants to support the demonstration of additionality. This requires the DOE to critically assess the presented evidence on the basis of local knowledge and sectoral expertise.” (paragraph 121). This means that rationales and justifications must be included in the PDD. They are not in this PDD.

It also means that goal of the DOE is not just to assess that the statements made in the PDD are true, but that they assess the believability that the project would not have been built had it not been for the CDM.

Let’s take a look at the best rationale and justification given. The entire additionality argument is contained in a sentence does not seem to describe this project: “The project proponent wishes to establish that there are barriers that would prevent the implementation of the project activity from being carried out if the project activity was not registered as a CDM activity.” This sentence does not make sense if it is being used to describe this project. The project has not been registered as a CDM activity, but it has already been implemented. It says that the project will not be completed if the project is not registered under the CDM. This is not true, since the project is almost fully completed. Certain the sentence needs to be revised to match the reality of this project. Maybe they meant to write “…had it not been for the expectation that the project will be registered under the CDM”. The fact that the main sentence justifying the additionality of the project does not tell an accurate picture of the implementation of this project, calls into question if the entire additionality section is written to reflect a true story of what actually motivated the implementation of this project.

Most sincerely,

Barbara Haya