La Esperanza Hydro Project

closed

The development objective of the La Esperanza Hydroelectric Development Project for Honduras is to support a small, 12MW hydroelectric project in La Esperanza through purchasing greenhouse gas (GHG) emission reductions. There are two components to the project, the first component being delivery of carbon emission reductions as a by-product of electricity generation. La Esperanza is expected to produce an annual average of 39,000 tCO2 Emission Reductions (ER). Community Development Carbon Fund (CDCF) will purchase a total of 310,000 tCO2 emission reductions at the price of US$4.50. The minimum annual delivery is set at 30,000 tCO2 a year but CDCF will purchase all annual ER production up to the cumulative 310,000 tCO2, expected to be reached by 2012 at the earliest. The total payment is US$1,395,000. This total does not include recovery of project preparation expenses such as those related to the baseline establishment, validation, monitoring, verification and certification. These will be deducted annually up to the cumulative maximum amount of US$125,000. Finally, the second component is the delivery of environmental and social community benefits. The payments for the emission reductions are directly linked to the sponsor's meeting the conditions set in the community development plan. These include: a) full-time employment of at least 70 permanent residents of la Esperanza and surrounding communities during the construction phase; and b) full-time employment of at least 20 permanent residents of La Esperanza and surrounding communities during plant operation (through December 31, 2012).