2 November CDM Executive Board UNFCCC Bonn, Germany. Dear Members of the CDM Executive Board,

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1 2 Noveber 2006 CDM Executive Board UNFCCC Bonn, Geran Dear Mebers of the CDM Executive Board, We refer to the requests for review raised b three Board ebers concerning AENOR s request for registration of the Bii Nee Stipa III (Ref 0517) and would like to provide an initial response to these requests for review. Reason for Request 1 The difference between the registered project activit Bii Nee Stipa 0107 and the subitted project activit 0517 needs to be clarified since the PDD of the registered project 0107 discusses Bii Nee Stipa III as phase 3. Both projects are conceived b a single project developer in the sae location and with the sae length of transission line. It has to be clarified that Bii Nee Stipa III is not a debundled part of project 107 which is likel to lead to double counting. Other issues to be clarified are - in the Additionalit test, using the investent test, the rate of return is not specified and the calculation of the IRR is intransparent - the build argin is not calculated correctl since in stead of fuel data efficiencies of tpical power plants are used and - the stakeholder consultation are insufficientl described since it is not clear how the local population was involved and stakeholder eetings entioned b the DOE are not referred to in the PDD Answer regarding request 1: a) Difference between Bii Nee Stipa (Ref. 0107) and Bii Nee Stipa III (Ref. 0517) Bii Nee Stipa III and Bii Nee Stipa are different wind far projects. Both are located in the sae region of Mexico, Oaxaca, but project locations are different. Both projects have undertaken the required environental ipact assessents and obtain the corresponding approvals fro SEMARNAT. Bii Nee Stipa project has undergone two environental ipact studies, one for the initial project design of 20MW, dated March 2003, a second one in Ma 2004 when it was deterined that the project would be expanded to 200MW. These two EIA have received the approval fro SEMARNAT on 22nd Jul 2003 (Ref. SEMARNAT SGPA DIRA / 136 / 2003) and on 2nd Jul 2004 (Ref. SEMARNAT SGPA DIRA / 232 / 2004), respectivel. Project participants have applied SEMARNAT for postponeent of works start date and for a change of the wind generators odels, in June 2005, in order to copl with all regulator requireents. Bii Nee Stipa III project has undergone one environental ipact stud. This EIA has received the approval of the SEMARNAT in August 2005 (Ref. SEMARNAT SGPA DIRA / 501 / 2005) for a 164 MW power. The location of both projects is different as confired b the official approvals for SEMARNAT where detailed coordinates of the wind turbines and total area of land to be used are specified. (Approvals were studied and referenced in the validation reports and are attached to this docuent. Also aps are attached where it can be seen that both projects are in different sites).

2 b) Additionalit Project proponents have use the last version of the Tool for deonstration and assessent of Additionalit to analze the Additionalit of the project. According to this Tool, project proponents shall go through step 2 or step 3 (or both). As entioned in the validation report, step 2 is not copleted since step 3 deonstrates clearl the Additionalit of the project. The inforation provided in the PDD is copleentar to the step 3 and it is just providing additional inforation. c) BM calculation The BM was calculated according to the ethodolog ACM0002 (Ver. 6). The efficienc factor of the power plant is used to calculate the fuel consued in the plant and includes fuel data. As it is shown in the following paragraphs the PDD calculates correctl the BM. The prooter follows in the PDD the procedure outlined below 1. Annual output of the power plant (GWh) 2. Eission factor of the power plant (tco2 / GWh) = Carbon content of the fossil fuel used in the power plant (tc / TJ) x 44 tco2 / 12 tc x 3.6 TJ/GWh ther / GWh elec /GWh ther 3. BM (tco2 / GWh) = Annual output of the power plant (GWh) * Eission factor of the power plant (tco2 / GWh) / Annual outputs of the power plants (GWh) This procedure is based on the ethodolog ACM0002 (Ver. 6) and on official data. BM calculation in the PDD: Power Plant Power Technolog Plant Annual output Efficienc Eission factor Coissioning (MW) factor (GWh) * (tco 2 /GWh) Chicoasén (Manuel Moreno Torres) 900 Hidro /15/2004 Rio Bravo III* 495 Cobibed Ccle , /01/2004 San Lorenzo Potencia 266 Gas Turbine /01/2004 Tuxpan 163 Gas Turbine /02/2004 El Sauz 128 Cobined Ccle , /01/2004 Altaira III IV 1036 Cobined Ccle , Tuxpan III IV 983 Cobined Ccle , Mexicali 489 Cobined Ccle , Chihuahua III 259 Cobined Ccle , Naco Nogales 258 Cobined Ccle , Capeche 252 Cobined Ccle , Los Azufres 190 Geotheral , Rio Bravo II 495 Cobined Ccle , Monterre III 449 Cobined Ccle , Bajío 577 Cobined Ccle , Altaira II 495 Cobined Ccle , Total 7,435 42,467 Table 22. New power plants installed. Source: Sener. Prospectiva del sector eléctrico , Prospectiva del sector eléctrico , Prospectiva del sector eléctrico The calculation of the eission factor: Chicoasén: 0 tco2/gwh (no eissions for hidro power) Rio Bravo III: (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh San Lorenzo Potencia: (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Tuxpan: (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh El Sauz: (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Altaira III IV (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Tuxpan III IV (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Mexicali (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh

3 Chihuahua III (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Naco Nogales (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Capeche (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Los Azufres 0 tco2/gwh (no eissions for geotheral) Rio Bravo II (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Monterre III (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Bajío (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Altaira II (56.1 tco 2 /TJ 3.6 TJ/GWh ther ) / GWh elec /GWh ther = tco 2 /GWh Total annual energ output fro the five power plants coissioning in 2004: 5,809.9 GWh Total annual energ output fro the 20% of 2004 output in coissioning order: 42,467GWh 20% of 2004 generation: 20% of 208,634GWh: 41,727GWh Build Margin Eission Factor: tco 2 /GWh BM = ( , , , , , , , , , , , ,155) / 42,467 = tco 2 /GWh Procedure and forulas outlined in the ethodolog ACM0002 (Ver. 6) EF BM, = F,. COEF GEN, Where F i,,, COEF and GEN, are analogous to the variables described for the siple OM ethod above for plants. Fj, is the aount of fuel i (in ass or volue unit) consued b fuel sources j in ear j, refers to the power sources delivering electricit to the grid, not including low-operating cost and ust-run power plants, and including iports to the grid, COEFj, is the CO2 eission coefficient of fuel i in tco2/ass or volue unit of the fuel) GENj, is the electricit in MWh delivered to the grid b the j source The previous table of the PDD leads to the sae result as indicated below taking into account the following conversions: Eission factor (tco2/tj) = Eission factor (tc/tj) * 44 tco2 / 12 tc GWh ther = 3.6 TJ Priar Energ consued = Annual output (GWh elec )/ plant efficienc Plant efficienc = GWh elec /GWh ther = GWh elec / (Aount of fuel (in ass or volue unit) * NCV (energ content per ass or volue unit) * (GWh ther / 3,6 TJ)) F, (TJ) = Fuel consuption (TJ) = 3.6 TJ/GWh ther * Annual output (GWh) / GWh elec /GWh ther

4 Power Plant Power (MW) Technolog Annual output (GWh) Efficienc* Fuel consuption (TJ) Eission factor (tc/tj) Eission factor (tco 2 /TJ) Coissioning Chicoasén (Manuel 900 Hidro /15/2004 Moreno Torres) Rio Bravo III* 495 Cobibed Ccle 2, /01/2004 San Lorenzo Potencia 266 Gas Turbine /01/2004 Tuxpan 163 Gas Turbine /02/2004 El Sauz 128 Cobined Ccle 3, /01/2004 Altaira III IV 1036 Cobined Ccle 6, Tuxpan III IV 983 Cobined Ccle 7, Mexicali 489 Cobined Ccle 2, Chihuahua III 259 Cobined Ccle 1, Naco Nogales 258 Cobined Ccle 1, Capeche 252 Cobined Ccle 1, Los Azufres 190 Geotheral 1, Rio Bravo II 495 Cobined Ccle 3, Monterre III 449 Cobined Ccle 2, Bajío 577 Cobined Ccle 5, Altaira II 495 Cobined Ccle 3, Total 7,435 42,467 BM = (16705* * * * * * * * * * * * * *56.1) / = 371,6 tco 2 /GWh It is clearl deonstrated that the PDD calculates correctl the BM. d) Stakeholder consultation During the on-site validation visit, unicipalit authorities and landowners were interviewed as indicated in the validation report and all supported the project and the anageent of the prooter. In fact it has been followed the sae procedure than in the alread registered project activit Bii Nee Stipa. It is iportant to reark that the Project Participant has been working in Mexico since 2001, and in Oaxaca in particular, tring to push the developent of renewable energies in that countr and the contact with all the parties involved in this issue has been of great iportance, obtaining a ver high degree of support. The revised PDD, sent to registration, includes odifications fro the PDD of the public inforation process. The PDD highlights the ain coent received, the reuneration ethodolog for land lease and how the prooter is addressing this issue. The prooter has been inforing landowners and authorities during the last five ears and the validation tea has validated on-site the support for the project and confired the nuerous activities developed b the prooter. Reason for Request 2 The difference between the registered project activit Bii Nee Stipa 0107 and the subitted project activit 0517 needs to be clarified since the PDD of the registered project 0107 discusses Bii Nee Stipa III as phase 3. Both projects are conceived b a single project developer in the sae location and with the sae length of transission line. It has to be clarified that Bii Nee Stipa III is not a debundled part of project 107 which is likel to lead to double counting.

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