The Bailongjiang Shuiboxia Hydropower Station (hereafter, the Project or the proposed project) developed by GEPIC Darong Electric Power Company Ltd. (hereafter, the project owner) is a run-of- river hydropower project in Gansu Province, the People’s Republic of China (hereafter, the host party). Total installed capacity of the Project will be 57 MW, consisting of three 19 MW turbines. The project will annually generate 228,800 MWh and supply 228,342 MWh (with Auxiliary Power Ratio 0.2%) electricity to the Gansu Power Grid, which is a part of the Northwest China Power Grid (hereafter, the NWCPG).

The purpose of the Project is to utilise the hydrological resources of the Bailong River through construction of a run-of-river hydro project to generate zero emissions electricity for the NWCPG. The electricity currently generated by the NWCPG is relatively carbon intensive. The project is therefore expected to reduce emissions of greenhouse gases by reducing the need of thermally generated power and reducing needed capacity expansion of fossil fuel-based generation of the NWCPG at an estimated 194,045 tCO2e per year during the crediting period.

The scenario existing prior to the start of the implementation of the proposed project: The electricity service is provided by the NWCPG prior to the start of the implementation of the proposed project. The electricity currently generated by the NWCPG is dominated by the fossil-fuel fired power plants and is relatively carbon intensive.

The project scenario:

The Project will utilise the hydrological resources of the Bailong River through construction of a run-of- river hydro project to generate zero emissions electricity for the NWCPG. No CO2 emission occurred during the process according to the methodology. The project is therefore expected to reduce emissions of greenhouse gases by reducing the need of thermally generated power and reducing needed capacity expansion of fossil fuel-based generation of the NWCPG at an estimated 194,045 tCO2e per year during the crediting period.

The baseline scenario:

The baseline scenario is the same as the one existing prior to the start of the implementation of the proposed project.

The Project’s contributions to sustainable development are as follows:

• Relieve the power shortage problem in the local area and facilitate the economic development of • Supply of reliable, zero-emitting renewable energy to the provincial grid, reduce other pollutant resulting from the power generation Industry and improve and protect the environment. • Increase local people’s income, job opportunities and quality of life. • Improved access roads that will enhance transport for the local goods and people.