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Peru: Santa Rosa Bundled Small Hydro
(Community Development Carbon Fund)

UNFCCC Reference No.: 0088

Project Photo 1

Project Description
The 4.1 MW Santa Rosa Hydroelectric Project, which uses the existing irrigation infrastructure as its source of water flow, is a milestone for Peru as it is the first small-scale CDM project to be developed in that country. The project is a bundle of small run-of-river hydropower plants located in the Santa Rosa Irrigation area of Sayán District. The project will help the national grid reduce the use of thermal plants and will displace expensive heavy fuel-diesel, coal, and gas-fired generation. The CDCF will purchase 88,000 tCO2e from the project with an option to purchase an additional 62,000 tons.

Project Photo 2
(Photo: The World Bank)

Current Context
In Peru, the options for hydropower are limited because most of the best locations for hydroelectric plants have been granted to private firms. Thermal plants, meanwhile, offer better investment opportunities because they face fewer restrictions and can be located almost everywhere. Additionally, hydroelectric plants require more than double the investment capital, and the construction period is one or two years more than for a thermal plant. Providing a revenue flow through carbon finance will help level that playing field.

Community Benefits
A community benefits plan additional to the main project was prepared at the initiative of the CDCF. Representatives from the village of La Merced were consulted in determining what would be the most desirable community benefits. A representative of the Peruvian Designated National Authority took part in the meeting. The project sponsor agreed to share part of the emission reductions income with the community of La Merced and also to provide free electricity to the neighboring orphanage, which is run by an NGO named Asociacion Achalay.

Deliverables

Description

Electricity

The project will deliver electricity to the local orphanage at no cost.

Improvements to school

State-owned and rural schools in Peru lack money to provide a good education to students and for school infrastructure. The project will provide $1 per ton of CO2 emission reductions for school improvement, including construction of a fence, building two new classrooms, and building a computer room with 10 computers.

Job creation

About 125 new jobs will be created for qualified and non-qualified workers in the three phases of the project and in local quarry for concrete work and for pressure pipe, powerhouse, and installation of electromechanical equipment.

Clean irrigation water

Installation of a trash rack cleaner in the irrigation canal will provide cleaner irrigation water for more than 500 families.

Community center

A new community center will be built.

Local infrastructure improvement

Help will be provided in maintenance of the irrigation canal and main road in Santa Rosa for more than 500 families.

Community Benefits Budget: $88,300

Monitoring Plan: The project developer will provide an annual report on the progress that has been made in the implementation of the community benefits plan during the previous calendar year. The report will include a detailed description on the status of implementation of activities that create the local community benefits.

Current Status:
Two progress reports have been submitted to date, in June 2006 and May 2007.

  • The local orphanage, la Casa Hogar de Menores, with 85 child inhabitants, has received free electricity since 2006.
  • During construction, local workers (number unspecified) were employed.
    • The sponsor built a computer lab in the local business studies school, La Merced. This consisted of providing computers, furnishings, and the wiring to make the lab ready for Internet connection.
  • The sponsor contributed to the maintenance of the local canal, Canal Madre de Irrigacion de Santa Rosa. It contracted with a local firm to remove solid waste from the canal. It also provided a weekly cash sum for maintenance to the local authority responsible for water/irrigation issues, the Junta de Regantes Santa Rosa.
  • For local non-specialized maintenance, local workers were hired for activities including plumbing, road maintenance, and the reinforcement of the loading dock.




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