Project Title:        China: Promoting Methane Recovery and Utilization   
                      from Mixed Municipal Refuse                         

GEF Focal Area:       Global Warming Mitigation                           

GEF Eligibility       [x] Eligible under financial mechanism of UNFCCC;   
                      Date of Ratification of FCCC, January 5, 1993       

Total project costs:  $19,570,000                                         

GEF Financing         $5.285 million                                      

Government            In-kind Contribution to the Project                 
counterpart                                                               
financing of GEF                                                          
Component:                                                                

Cofinancing/          $14.28 million                                      
Parallel financing:                                                       

Associated Project:   not applicable                                      

GEF Operational       Mr. Yang Jinlin, Ministry of Finance                
Focal Point                                                               

GEF Implementing      UNDP                                                
Agency:                                                                   

Executing Agency:     Government of China                                 

Local Counterpart     National Environmental Protection Agency (NEPA)     
Agency:                                                                   

Estimated approval    October 1996                                        
date:                                                                     

Project Duration      4 years                                             

GEF Preparation Cost  $25,000                                             

1. China's population has lived largely in rural areas in the past, and its widespread use of composting techniques in agriculture has contributed to slow growth of organic refuse. Due to China's trend toward increasing industrialization, and accompanying urbanization, consumption and waste production patterns are changing. Previously 80% of urban solid waste was industrial in nature, mostly coal waste materials, and though the non-organic proportion of urban waste remains high, an increasing percentage is now composed of biodegradable material due to rising waste from households.
2. The waste output from China's cities is currently more than 80 million tons per year, which is increasing at an annual rate of 10%. By 1988, 6.6 billion tons of untreated solid waste had accumulated, occupying 55,400 hectares of land. National authorities estimate methane emissions from municipal waste to be in excess of 1 million tons per year, which will increase as China's municipal wastes, and their organic content, increase.
3. China has little experience with comprehensive solid waste management, or sanitary landfill practices, which currently characterize less than 8.3% of all sites. Most of China's waste sites are open pits located on the urban fringes, in stream or river valleys or on 'marginal lands' such as wetlands where mixed municipal wastes are deposited. This uncontrolled dumping has created breeding grounds for mosquitoes, other disease spreading insects, and rats. Ground water and drinking water aquifers are severely polluted in these areas; odors and trace toxic gasses affect the health of the surrounding population; and the land has been rendered useless for other purposes. China, due to its large population, low availability of arable land and increasing urbanization cannot, for practical purposes, continue to pursue a land extensive, unmanaged approach to waste disposal.
4. It has been estimated that methane emissions from landfills will rise steeply in the next few decades being one of the fastest growing sectoral source of greenhouse gases in China. Firstly the total amount of waste will increase in the future. China has over fifty cities with population over 1 million official inhabitants each. A number of these have population in excess of 10 million (Beijing, Shanghai, Tianjin). The trends of rural to urban migration, population growth and industrialization in China suggest, that the number and size of urban centres will continue to grow rapidly in future, increasing the subset of cities which could support the dissemination of methane recovery technology. Secondly, the organic content of the waste will increase. The third and most relevant is the issue of the Government's commitment to waste disposal through sanitary landfills.
5. In 1992, recognizing its own economic and environmental interest, China set a goal to dispose 60% of municipal refuse in sanitary landfills by the year 2000. Accordingly, Chapter 19 of China's Agenda 21 Action Plan calls for the formulation of laws and regulations governing environmentally sound management of municipal solid waste. More recently, the National Environment Protection Agency has elaborated the China TransCentury Green Programme to state China's environmental investment priorities during the Ninth Five Year Plan period (19962000). The Green Programme identifies five key sectors for environmental investment and lists priority investment projects to be undertaken during the plan period through support from central, provincial and municipal government financing. The programme of solid waste pollution control projects is the third priority category following water and atmospheric pollution. Within the programme 8.8 billion Chinese yuan (US$ 1 billion) are targeted for solid waste management. Industrial solid waste of 620 million tons per year is produced in China, while urban domestic solid waste accounts for an additional 100 million tons.
6. The proposed GEF Methane Recovery project directly supports the solid waste management objectives outlined in the Green Programme through the demonstration of new and energy efficient technology in China. Control of methane emissions from the existing and planned landfills, which is the purpose of this project, will benefit both China and the world, since it will generate electricity for the country and help stabilize global climate change by reducing the release of a potent greenhouse gas (GHG). Of the available methane, that comprises half of the gas being emitted from landfills and dumps, a very small portion is being captured and used productively today. Controlling methane emissions will require improved landfill construction, and landfill gas collection and utilization, in addition to the construction of sanitary landfills. STATE OF PREPARATION
7. Methane harvesting from solid waste landfills in industrialized countries is a mature practice. Gas from a landfill in New York is upgraded to pipeline quality and used to provide energy equivalent for heating 10,000 homes in winter. The largest US waste management firms routinely recover and use the landfill gas from all of their sites as soon as they are closed. A large landfill located in a canyon in Los Angeles accepts about 12,000 tons of refuse per day. Since 1987 its landfill gas has been used to generate several million Kwh per year of electricity in a power plant built on site. Landfill gas recovery is actively encouraged in the US as public policy: there has been a tax incentive in place for several years for each unit of energy recovered, and soon gas recovery will be mandated for certain landfills. Methane recovery projects are being operated in many countries including Germany, UK, Sweden, France, Denmark, Japan, Brazil, and Chile.
8. While no landfill gas projects have been developed in China, domestic researchers have in recent years studied the feasibility of anaerobic treatment systems for a variety of municipal, industrial, and agricultural waste products including municipal refuse. Work has been done at the Beijing Environmental Sanitation Research Institute, the Chengdu Organism Institute under the Chinese Academy of Sciences, and the Organism Engineering Center in Wuhan University.
9. The National Environmental Protection Agency (NEPA) feels that to promote the practice of recovering and using landfill gas it will be necessary to identify, analyze, recommend, and conduct trials on methane conversion methods that are appropriate to the variety of conditions in China. NEPA has worked closely with the three cities interested in the proposed project and has gained their cooperation. A GEF landfill gas expert has completed a mission to China and has reported on the feasibility of the project. BARRIERS TO LANDFILL GAS CAPTURE AND UTILIZATION IN CHINA:
10. There are two types of barriers to the practice of landfill gas capture and methane gas utilization in China. The first barrier is technological since this practice has not been attempted earlier in China. Lack of and access to information on landfill gas recovery technology, lack of experience of designing, construction and operating gas recovery plants, and high costs of imported technology are some of the technical barriers that this project will address. The Chinese need to gain experience with pipe design, layout, removal of moisture and non-methane components, managing surges in gas supply, etc. The second type of barrier is institutional management of landfill gas resource in China because of lack of definition of institutional responsibility and resource ownership. As in the case of coal bed methane, it is unclear as to who owns the resource, and how the municipal, provincial and national institutions should cooperate with private industry and the households to harvest this resource to everyone's benefit. The formulation of specific laws and regulations that may govern such relations are yet to be developed fully and systematically. The current municipal waste management systems and operational mechanism cannot meet requirements of the market economy.
11. Overcoming these two barriers are important for the viability of the pilot plants and their successful technical and managerial performance. Replication of these plans requires that NEPA in coordination with equipment manufacturers and suppliers, and financiers, take responsibility for the effective utilization of the demonstrated processes elsewhere in the country. Profitable operation of the pilot plants in a manner convincing to other municipal waste managers will be crucial to this task.
12. The project is expected to overcome these barriers by: (a) gaining experience in identifying, designing, constructing and operating landfill gas recovery and utilization plants in China by constructing and operating three pilot plants in three different sites at Anshan, Maanshan, and Nanjing. (b) training national staff to undertake the above functions over time. (c) building capacity through experiences gained, and bringing in conditions that will promote indigenous enterprises that will build and operate recovery systems and utilize energy. Domestic manufacturing of equipments will aim at lowering the costs of technology. (d) promoting its acceptance among local decision makers and demonstrate it as a viable measure that produces energy as well as reduces air, water and land pollution. This will create essential incentives to develop further institutional and legal framework related to landfill gas recovery technologies. (e) by developing an action plan based on the experience from pilot plant, to promote wide spread replication and adoption of landfill gas recovery technology in China. (f) strengthening existing national institutes to enable them to disseminate the knowledge and techniques learned during this project.PROJECT OBJECTIVESLong Term 13. The long term objectives are to promote wide spread adoption of landfill gas recovery technology in China based on the technical and organizational experience gained from the three pilot landfills proposed in this project. Specifically, these include (a) recovery of a resource that will reduce fossil fuel use; (b) significant reduction of emissions of methane, a greenhouse gas; (c) reduction in air, water, and land pollution associated with refuse dumping; and (d) promotion of indigenous enterprises that will build and operate recovery systems and utilize the energy.Short Term14. In order to realize these objectives, the following short term objectives must be reached: (a) test several gas recovery designs on small sections of three existing landfills or dumps in order to maximize gas yield. (b) demonstrate several gas utilization systems at the three small-scale trials; (c) use field trial data to design, construct, and operate three full scale pilot landfill gas recovery plants at sanitary landfills in Anshan, Maanshan, and Nanjing; (d) develop an action plan to promote wide spread replication and adoption of landfill gas recovery technology in China. (e) strengthen Beijing Environmental Research Institute as a national center for methane recovery research and dissemination, that will disseminate the knowledge and techniques learned during this project. The Center will provide valuable information and assistance to municipalities and businesses in China.PROJECT DESCRIPTIONStrategy15. Landfill gas recovery has not been attempted in China thus far, but the Chinese government recognizes its importance in municipal waste disposal and wishes to recover the methane that will be generated from landfills. The construction of a sanitary landfill for methane production is different than that designed merely for waste disposal. Challenges such as water collecting in pipework causing power surges, gas shortfall, air ingress, leachate migration etc., have to be resolved, which requires field trials of gas collection, utilization and power generation systems. In addition, project developers, financiers, local planners, local authorities, potential waste management companies, equipment suppliers, and local residents are all stakeholders in such a scheme. Organizational structures will have to be tested at each of the three sites in China to address issues of concern to these groups, in order to spur the replication of similar projects in other cities. This project will test and resolve resource- and technology-specific barriers at each of the three pilot sites, and develop organizational setups to overcome the institutional barriers. Not only will valuable experience be gained with methane recovery practices, technology, management approaches, resources recovery and economic management, the GEF project will provide a basis to explore institutional roles and relationships between the various agencies and levels of government involved. This is particularly important due to the process of transition to the market economy which China is undertaking. The output oriented central plan model of macro management provided little by way of experience or motivation for waste reduction or management. China hence lacks experience with management practices which reflect economic and price incentives and which minimize resources used for environmental management. The institutional context which the project will provide to experiment with new modes of management is particularly important from a public policy perspective in China. In the absence of a GEF supported project, these roles would not be examined with urban management responsibilities continuing to fall along conventional lines. The project will also allow Chinese managers to learn about the sustainable financing opportunities which methane recovery and distribution can generate to support municipal solid waste management. This will have a very important demonstration effect in China.16. After a brief phase of testing of gas recovery designs on small sections of existing landfills and study-cum test of methane generation conditions like analysis of waste parameters at the new sites, the project resources will focus on three field trial sites where recovery design can be tried and observed on landfills to determine which will safely produce the highest and most consistent methane yields. After the trial information has been analyzed, three full scale pilot plants will be built to demonstrate methane recovery and a variety of productive uses of the fuel resource. The pilot plants will be constructed at sanitary landfills that meet NEPA standards. NEPA will then be able to use the three sites to display the latest standard in solid waste disposal for other cities in China. It will also create a permanent Center to continue researching methane recovery and utilization methods and to disseminate this expertise to those cities starting new plants. 17. The creation of an action plan and its implementation to disseminate the results of the pilot plant operations are critical and important phases of the project. China has 50 cities with a population over 1 million each. A number of these have populations in excess of 10 million (Beijing, Shanghai, Tianjin). It would be reasonable to expect that the administrative and financial base of these cities of over one million could support the dissemination of the administrative approach and technology demonstrated through the GEF project over the next 1020 year period. The trends of rural to urban migration, population growth and industrialization in China suggest that the number and size of urban centres will continue to grow rapidly in the future increasing further the subset of cities which could support the dissemination of methane recovery technology.Descriptions of locations of field trials and pilot plants 18. Both the NEPA and China office of UNDP, which is the implementing agency, are located in Beijing. The Beijing Environmental Research Institute which is expected to operate as the National Center for Methane Recovery Research and Dissemination is also located in Beijing. The three trials, as well as the three permanent full-scale pilot plants, will be located at landfills in Anshan, Maanshan, and Nanjing. The main reasons for choosing these three cities as demonstration sites are as follows: (a) The waste streams from each city are very different and represent different solid waste categories across China. The organic content of the waste will vary from 60% in Anshan to 80% in Maanshan. The landfills will be located at a distance of 5 km from Maanshan and 15 km from Anshan. The methane percentage of landfill gas is expected to vary between 40 and 50% at each site. The three cities will generate refuse varying from 300 tonne per day (tpd) in Maanshan, to 800 tpd in Nanjing to 1200 tpd in Anshan. The Waste composition of Nanjing city is more complex that the other two. (b) The sites are different in terms of their age and level of technology/landfill practices. Whereas the Anshan site is a new site where technology could be designed into the landfill process from the bottom up, Nanjing is an existing site where the challenges of technology introduction and changes in landfill site management will be explored during the implementation of the project. Maanshan is in an intermediate stage of its life cycle. (c) The amount and method of leachate pollution control are very different in these cities. (d) The geologic conditions of the three cities are very different. The geologic conditions at Nanjing, Anshan and Maanshan are clay, stony and waste mine quarries respectively. Hence, the engineering designs are different. (e) The sites are in parts of China that are not only geographically distinct but are from three very different types of cities that face different public policy and management challenges related to what stage of the transition to the market economy they find themselves in. Anshan in northeast China is characterized by heavy industry comprised of State owned enterprises running on the central plan model and which face an old style approach to municipal management based on allocative and administrative decision making. Nanjing on the other hand is a city more fully absorbed into the transition to the market economy where business and commerce run on market and price signals more so than on central planning. As such municipal planners and managers are more apt to experiment with new gas pricing and land management practices. Thus the institutional structures are different between the three sites, yet representative of other Chinese cities. This GEF project can demonstrate the benefits of landfill gas recovery in both the old and new contexts which are both present in China during the economic transition process. (f) Each city has performed primary research on gas recovery systems, and (g) Local governments have paid more attention on this topic.19. These seven factors mean that different demonstration effects can be achieved at the three sites and technology could be compared for its effectiveness in different public policy and financing contexts. 20. Local and municipal governments increasingly bear the economic and administrative responsibility to provide urban infrastructure and services including the provision of water and sanitation services. While these governments have attended to developing urban infrastructure and communication, less attention has been given to channelling resources for "non-productive" local investments such as water and sewage treatment and waste disposal and management. The main tax base for local authorities stems from large state owned, and private enterprises. To date, households and individuals bear little or no costs for the sanitation services which are provided. As part of the pilot projects, new organizational structures will be tested to change the tax or fee system, the way the municipal government can access financing, the setting up of companies to manage gas collection and electricity generation etc., which will permit each pilot plant to operate cost-effectively in the future. 21. A detailed profile of each of these three cities is in Annex 1. Activities22. This project consists of four activities:Activity 1Determine the best methods for efficient extraction of gas from existing and new landfills. This involves the following three steps: Activity 1.1: test several gas recovery designs on small sections of existing landfills in order to optimize the yield of gas and get information on exact volume of gas under various conditions. Activity 1.2: Study and test designs at new sites. Activity 1:3: Apply from choices made in the above two activities to field trials and test landfill gas collection techniques and layouts at three sites. At least two forms of energy utilization should be confirmed for use in China: electrical production using internal combustion engine/generators, and direct transport of the methane-carbon dioxide mixture to near by kilns or industrial boilers. The plants will be small but useful for real-world demonstration using state of the art equipment. Resources will not be spent on unnecessary structural or site features. Information gathered at this stage will be useful for both pilot site plant designs and for the action plan to be developed in the next stage. The trials will operate for a sufficient duration to produce a full set of data on varying operational conditions. The following is a list of design factors, operating variables and outputs, among others, that will be studied. Effect of fill height and density on gas yield and quality; Effect of leachate recirculation on gas yield; Methane content and variability; Optimum blower settings (flow and pressure); Gas yield per year per unit of fill volume; Effect of clay cover thickness on yields; Effect on yield from wells with horizontal branches; Off site gas migration data; Operational cost experience; and Design features for permanent pilot plants. The most practical designs and operating procedures will be transferred to permanent pilot plants for full commercial utilization. Trained staff will be provided at each trial location to operate and maintain the equipment, vary operating parameters, gather and analyze data, make plant changes, work closely with energy purchasers, and give detailed tours to visitors. The result of this task will be a complete technical report from each installation and a coordinated report that will link the data and will draw appropriate conclusions there from. Activity 2Design, Construction, and Operation of Three Pilot Landfill Gas Recovery Facilities: Three pilot plants will be constructed at NEPA-standard sanitary land fills at Anshan, Maanshan, and Nanjing in order to fully demonstrate the field research and development trial results. Design and construction funds for these landfills are being provided by the cities themselves as part of the co-funding. The following tasks will be performed at all three facilities: Activity 2.1: Review Existing Landfilling Plans. It is possible that the landfilling plans done earlier for the three facilities are not fully compatible with the criterion of maximum landfill gas capture. For example, cell sequencing should permit one section of the site to be brought to full elevation and capped so that methane collection wells may be installed. Information from the trials may affect disposal operating procedures such as compaction requirements, or installation of horizontal well branches as filling proceeds. Plans and operating manuals will be revised as needed. Activity 2.2: Design Landfill Gas Collection System. This task will build upon the knowledge gained during the field trials. A sequenced plan for each site will include a schedule of when each section will be completed and ready for gas harvesting, and it will present a table of expected energy yields over time. Activity 2.3: Select Energy Recovery Plant Configuration. This task also builds on field trial experiences. The type and capacity of system components will be selected. Agreements will be reached with the intended fuel or electricity markets, and a schedule for bringing on additional modules to use increasing gas supplies will be prepared. Design, construct and start first stage Environmental and other needed permits will be obtained. Detailed plant designs will include ample viewing access for visitors interested in replication of the systems. Space will be provided for adding system modules. It is expected that all three systems will be operating, at least under part load conditions before the four year project duration has elapsed. Full operation will be phased in by the cities over a number of years. Activity 3:Strengthen the National Center for Methane Recovery and Dissemination.The Beijing Environmental Research Institute will be strengthened to continue the task of maintaining,and assimilating the outputs from earlier 3 activities. It will become a permanent centre called the National Center for Methane Recovery Research and Dissemination. This facility will be the primary means to train personnel from cities interested in building methane recovery plants. It will disseminate knowledge and techniques learned during this project, and later, to all areas of China and to other developing countries. It will produce videos of pilot plants and provide summaries of studies, reports, designs, and new developments to all interested parties. It will keep up with world developments, set up regular training programs, and manage a resource of reports, software packages, videos, and other materials from around the world. The manufacturers, private entrepreneurs and financiers will be involved in the dissemination programmes and task force groups to enable them free access to the modalities, and activities of the project and come up with viable systems at the end of the project. Activity 4: Development of an Action Plan to Promote Widespread Adoption of Landfill Gas Recovery Technology.The information collected from the three demonstration projects will be used as the basis for the National Environmental Protection Agency to develop an action plan to promote widespread adoption of methane recovery from sanitary landfills in China. The action plan will have the following major elements: Activity 4.1: Formulate National policy, regulations and standards for methne recovery from sanitary landfills. Activity 4.2: Establish financial aid or other incentive policy for municipalities to adopt methane recovery system. Activity 4.3: Provide technical assistance to municipalities and private sector entrepreneurs in the planning, design, construction, and operation of methane recovery systems.China has set a goal that by the year 2000, 60% of all municipal refuse should be disposed in sanitary landfills. The action plan will spur the adoption of methane recovery by most of these landfills.Outputs23. The output of these four activities will be: a (1) body of knowledge on efficient methods to reduce methane emissions from the nation's landfills and practical ways to utilize the recovered energy in the context of the China economy; (2) number of small and commercial-scale landfill gas recovery demonstration plants; (3) identified local entrepreneurs and partners for commercial management of landfill and power generation sites. (4) number of engineers, operators, and managers who will have gained first hand experience in landfill gas recovery; and (5) a permanent center to update and disseminate the knowledge required to facilitate methane recovery in large numbers of Chinese cities.INSTITUTIONAL ARRANGEMENTS FOR PROJECT DEVELOPMENT AND IMPLEMENTATION24. A number of national, local, and foreign entities will be responsible for developing, managing, and implementing the project. Their roles are summarized below: (a) UNDP. The UNDP will provide overall leadership and management from its in-country office in Beijing. In addition, the project will benefit from the worldwide experience of other UN agencies such as UNEP, and UNIDO. (b) NEPA. The National Environmental Protection Agency has formulated and coordinated this project from its inception, and it will continue to play that role. NEPA will review all activities for technical quality, economic efficiency, organizational performance, and adherence to national environmental laws and policies. NEPA will rely on other national agencies and ministries such as agriculture and energy. (c) City Governments. The pilot plant host cities have already organized task forces for the project that link the Environmental Protection Bureaus (EPB's), with the sanitation, and construction departments under the leadership of a deputy mayor. These organizations will plan and implement the field trials and the pilot plants. It is anticipated that city personnel will play a major role in operating the methane plants, although the possible role of NGOs will be evaluated during the project. The cities will perform under NEPA direction. Beijing will appoint a city department to manage the field trial in that city. (d) NGOs. Both NEPA and the cities will rely heavily on a variety of institutes, universities, and private consultants to perform much of the study, research design, and engineering work involved in every phase of the project. The work will be let out on a competitive basis. (e) Private manufacturers and financiers. At each of the three pilot sites, private manufacturers and financiers will collaborate with NEPA, city governments and NGOs to help decide the best equipment and financing schemes that could be set up so as to be able to replicate the pilot projects elsewhere in China. (d) The owners and operators of the landfill will negotiate a power purchase agreement with the electricity bureau and/or an neighboring industry interested in purchasing power from the landfill plant. China has little or no experience in negotiating such agreements at the moment and the project will serve as a model for the purchase of electricity.DEVELOPMENT DIMENSIONS25. The objectives of the landfill gas recovery project are in accordance with China's environmental and energy policies. The project is consistent with the country's Eighth and Ninth Five Year Plans which call for demonstration technologies and comprehensive environmental programs at the local level. In fact, the government is counting heavily upon this project to initiate the gas recovery portion of its environmental strategy. 26. The project provides the necessary technical skills that may be required to set up large scale methane recovery projects which will be cost-effective in introducing co-generation. The pilot plan scales are too small to introduce waste heat recovery at a meaningful scale.27. The project also furthers UNDP development themes such as sustainable development, exploitation of indigenous resources, environmental improvement (both global and local), and technology transfer of new industrial techniques.SOCIO-CULTURAL IMPACT28. Widespread adoption of landfill gas recovery projects will result in at least two positive changes to the citizens associated with or living nearby the projects. First, the construction and operation of standard landfills and gas recovery facilities will provide a number of medium skill jobs. Second, methane is clean-burning fuel, and to the extent that it is used to replace the use of coal, air pollution will decrease. No negative socio-cultural impacts are anticipated.SUSTAINABILITY - INSTITUTIONAL, FINANCIAL, AND HUMAN29. The recovery and use of a waste resource that is superior to the resource it replaces is normally an easily sustainable activity. In this case the national and local authorities strongly support landfill gas recovery, and the economic conditions indicate (from preliminary analysis) that well run recovery operations should realize positive cash flow. Design and operation techniques are easily learned and replicated. In view of these factors, large-scale replication of the pilot plants should have a strong chance of occurring. Even when economic incentives are not clear-cut, city leaders are likely to use other financial means to sustain plant operation. One other factor that may enhance sustainability will be studied during the project, and that is privatization of all or part of energy plant operations.LESSONS LEARNT30. The project has the working example of the Coalbed Methane (CBM) project in China.The UNDP pilot phase GEF project in CBM development was instrumental in overcoming the basic issues of defining institutional responsibility by providing a context for various entities to talk to each other about concrete resources rather than domain and turf. A new CBM development corporation drawing on three principal ministries is being set up in China to handle CBM resources as a result of the CBM project. Methane resource development is now a stated energy sector development in the 9th Five Year Plan, mostly with respect to the coal sector so far. In the case of municipal waste methane it is not clear as of now who owns it because it has not been commercially (or otherwise ) harvested and applied. This means that the new GEF project will provide the first opportunity with a practical context for the Chinese agencies to explore this. The experience of the CBM project in bringing together various institutions at different levels of operation will serve as a valuable exercise to learn from.RATIONALE FOR GEF SUPPORT31. Municipal refuse undergoing anaerobic decomposition in landfills continuously emits greenhouse gasses, methane and carbon dioxide, for decades. Methane will soon rival carbon dioxide as the most important greenhouse gas. If this project is approved, the methane produced from three landfills with annual inputs totalling almost one million tons of solid waste per year will be captured and used. As most fuel uses in China will replace coal, global warming will be mitigated in two other ways: decreased emissions of carbon dioxide, and decreased methane escape from coal mining operations. The net effect will be reduced methane from landfills and coal mines, reduced carbon dioxide from power plant coal combustion, offset to a smaller extent by increased carbon dioxide emissions from methane combustion at landfills (see Table 1 below). 32. When the three landfills are full, the quantity of waste in place will total about 16.8 million tons (metric). The amount of landfill gas captured at those three sites would be approximately 518 million m3 at a unit incremental cost of $4.52 per tonne of C equivalent (Table 1).

                                                                                
Table                                                                           
 1:                                                                             
GHG                                                                             
reduc                                                                           
tion                                                                            

      Item                            Value                Explanation          

1.    Landfill gas from the three      270 + 66 + 182 =    Anshan+Maanshan+Nanj 
      sites (Mn. 3)                   518                  ing                  

2.    Methane gas (Mn. m3)             518 * .5 = 259      50% landfill gas is  
                                                           methane              

3.    Methane gas (Th. tonnes)         259 * .662 = 171    Density=             
                                                           0.662 kg/m3          

4.    Methane gas avoided (Th.         171 * 6 = 1028      Radiative forcing    
      tonnes C equiv.)                                     index=22             

5.    Methane combustion CO2 release   171 * 12 / 16=128                        
      (Th. tonnes C)                                                            

6.    CO2 avoided from coal            128 * 25.57 /       Assume same thermal  
      combustion (Th. tonnes C)       14.47   = 227        efficiency of small  
                                                           gas and large coal   
                                                           power plants         

7.    Avoided coal mining methane      40                  Assume 23.23         
      (Th. tonnes C)                                       m3/tonne of Chinese  
                                                           coal                 

8.    Net avoided emissions (Th.      1028 - 128 +227 +    Rows(4-5+6)          
      tonnes C)                       40 = 1167                                 

9.    GEF funding (Mn. US $)           5.285                                    

10    Cost-effectiveness ($/tonnes     4.52                Rows (9/8)           
      C)                                                                        

 PROJECT BUDGET (US$                                                          
'000)                                                                         

                        Consultant Training   Equipment  Install. &  Totals   
                        s                                Oper.                

1. Field Trials               380*        50*        835         300    1,565 

2. Three Pilot Plants         250*       150*      2,016         400    2,816 

3. Strengthening R&D          150*       100*       200*         25*      475 
Center                                                                        

4. Action Plan                100*        75*                             175 

 Subtotals                     880        375      3,051         725    5,031 

Monit. & Eval. (2%)                                                       100 

Support costs (3%)                                                        154 

 TOTAL                                                                  5,285 

                                                                                   
                                                  Project                          
                                                   Years                           

                                                     1    2       3       4        

1.0   Field Trials                                                                 
                                                                                   
 1.1 For Existing LF sites: Test Several Gas      xx                               
Recovery Designs                                                                   

 1.2 For New LF sites: Study conditions of waste  xxx                              
characterisation and Test Gas Recovery Designs                                     

 1.3 Coordinate and Apply Test Results of 1.1 &        x  xxxx    xxxx             
1.2                                                                                

2. Three Pilot Plants                                      xx     xxxx    xxxx     

3. Strengthen Research & Dissem. Ctr.              xx     xxxx    xxxx    xxxx     

4. Action Plan                                     xx     xxxx    xxxx    xxxx     

                (1) Baseline  (2)             (3) Increment  (4) Revenue  (5) Net      (6)        (7) GEF     
                              Alternative     of (2) - (1)   from sale    Increment    Capacity   incremental 
                              (inclusive of                  of           (3) - (4)    building    cost       
                              Power                          electricity               costs      (5) + (6)   
                              Generation                                                                      
                              Cost)                                                                           

Costs (US$ Mn)  10.77         10.77 + 8.80 =  8.80 (see      5.10 (see    3.70         1.58       5.28        
                              19.57           annex 6)       annex 6)                                         

Domestic        Health        1. Health       Incremental    Revenue                   skill                  
Benefits        advantages    advantages      benefits       from sale                 formation              
                from          from sanitary   through        of                                               
                sanitary      landfill        dissemination  electricity                                      
                landfill      2. Revenue      of Gas                                                          
                              from sale of    Recovery                                                        
                              electricity     techniques                                                      
                                              and training                                                    

Global          Negative      Methane         mitigation                               skill                  
Environmental   benefit       combustion      scenario:                                formation              
Benefits        (i.e.         release 128     Emission                                                        
(Th. tonnes of  emissions     Th. T of C      reduced by                                                      
C)              from                          1167 (Th. T                                                     
                landfill                      of C)                                                           
                methane 1028                                                                                  
                Th. T of C                                                                                    
                equiv.) +                                                                                     
                CO2 avoided                                                                                   
                from coal                                                                                     
                combustion                                                                                    
                (227) +                                                                                       
                avoided coal                                                                                  
                mining                                                                                        
                methane (40)                                                                                  
                = 1295                                                                                        

The comments of the STAP reviewer have been incorporated into the text of the  
proposal.  The project document has been put through extensive peer review     
and technical review.  The comments of the independent technical reviewer,     
Prof. David Hall, have been incorporated and the proposal has been             
strengthened accordingly.  Questions raised in an earlier review of the        
document have all been well answered in extensive consultation with the        
country office, NEPA, (the local implementing agency) and consultants for the  
project.                                                                       

WORK PROGRAM PROPOSED FOR COUNCIL APPROVAL

GEF/C.7

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