Appendix

Provincial Biomass & Circular Bioeconomy Platform

1. Climate Rationale and Eligibility

The Kalasin Provincial Biomass Platform is fundamentally designed as a climate mitigation and air-quality intervention infrastructure, addressing two internationally recognized emission sources:

1. Avoided open-field burning of agricultural residues (rice straw and sugarcane leaves)

2. Displacement of fossil-based grid electricity through renewable biomass power generation

These interventions are fully aligned with:

• IPCC Guidelines for National GHG Inventories

• UNFCCC mitigation pathways for agriculture and energy

• Thailand’s Nationally Determined Contribution (NDC)

• Voluntary carbon market eligibility criteria

The project qualifies as a hybrid climate solution combining:

• Avoided Emissions (open burning and fossil power displacement)

• Nature-based and soil-linked benefits via organic compost application

2. Carbon Credit Generation Pathways

2.1 Avoided Open Burning (Primary Credit Driver)

Agricultural residues that would otherwise be openly burned are instead collected, processed, and utilized.

Key climate benefits:

• Immediate reduction of CO₂, CH₄, N₂O, and PM2.5

• High additionality due to regulatory pressure on burning and lack of alternative infrastructure

Estimated factor (conservative):

• ~1.5 tCO₂e avoided per tonne of biomass diverted from open burning

Province-wide impact:

• Biomass utilized: 1,455,719 tons/year

• Estimated avoided emissions: ~2.18 million tCO₂e/year

This category is suitable for:

• Domestic compliance schemes

• Voluntary carbon markets

• Results-based air-quality finance

2.2 Fossil Electricity Displacement

Biomass power generation displaces grid electricity primarily generated from natural gas and imported fossil fuels.

Assumptions (conservative):

• Average grid emission factor: ~0.45 tCO₂e/MWh

• Capacity factor aligned with Thai biomass baseload plants

Eligible mechanisms:

• Renewable energy carbon credits

• Climate-linked power purchase agreements (PPA + carbon attributes)

2.3 Soil Carbon & Circular Agriculture (Secondary / Upside Layer)

Organic compost produced from agricultural residues is returned to farmland, improving:

• Soil organic carbon (SOC)

• Moisture retention and fertilizer efficiency

• Long-term yield stability

While soil carbon sequestration is treated conservatively at early stages, the platform is future-eligible for:

• Soil carbon methodologies

• Insetting programs with agri-industrial off-takers

• Blended finance structures combining mitigation and adaptation

3. Carbon Standards & Registry Pathway

The project is structured to maintain methodological flexibility, enabling registration under multiple standards depending on buyer demand.

Potential Standards:

• T-VER (Thailand Voluntary Emission Reduction Program)

• Verified Carbon Standard (VCS – Verra)

• Gold Standard (Energy & Agriculture methodologies)

• Article 6–aligned bilateral programs (future option)

Initial registration is expected at the programmatic level, enabling:

• Aggregation of multiple clusters

• Lower transaction costs

• Scalable credit issuance across years

4. Digital MRV & Data Integrity

The platform is designed from inception for Digital MRV (Measurement, Reporting, and Verification) readiness.

Key MRV Components:

• Biomass origin verification at district and warehouse level

• Digital weighing, moisture content, and chain-of-custody records

• Power generation metering and grid export data

• Compost output tracking and land application records

This structure supports:

• Third-party verification

• Remote auditing

• Integration with international carbon registries

5. Climate Finance Instruments

The project enables layered climate finance, reducing equity risk and improving project bankability.

5.1 Carbon Credit Revenue

• Annual issuance potential: ~2.0–2.2 million tCO₂e

• Forward sales or offtake agreements possible

• Optional price hedging or floor mechanisms

Carbon revenues may be:

• Monetized directly

• Used as downside protection for senior lenders

• Structured as performance-based upside for equity investors

5.2 Results-Based Climate Finance (RBF)

Eligible for:

• Air quality improvement programs

• Climate mitigation performance payments

• Development partner co-financing

This is particularly relevant for:

• Multilateral climate funds

• Bilateral cooperation agencies

• Provincial-level clean air initiatives

5.3 Blended Finance Structure

Carbon and climate-linked revenues can be used to:

• De-risk early project phases

• Improve DSCR for project finance

• Enable concessional tranches alongside commercial capital

This structure is well aligned with DFI participation and long-tenor infrastructure capital.

6. Risk Management and Conservatism

To ensure credibility and investor confidence, the platform adopts:

• Conservative emission factors

• Exclusion of speculative sequestration at early stages

• Third-party verification before monetization

Upside mechanisms (soil carbon, insetting premiums, Article 6) are treated as future optionality, not base-case assumptions.