Longhe 1.03MW Hydro Power Project

Audit Analysis

The Longhe 1.03 MW hydro project has a confirmed additionality assessment by TÜV NORD CERT and benefits from the inherently low reversal risk of a small hydro avoidance project. However, the verification process surfaced an extraordinary volume of material findings (over 50) and corrective actions (over 40), including missing contracts, IRR discrepancies, non-compliant monitoring, and a note that internal validation initially rejected the documentation. The project-specific baseline, contradictory leakage justifications, and absence of a stated buffer pool or baseline reassessment date further erode confidence in the integrity and documentation quality of the credit.

Project Description

Red Flags

• ⚠Over 50 material findings and 40+ corrective actions identified by the VVB, including missing construction contract, on-grid agreement, ERPA, and loan contract
• ⚠Internal validation initially rejected the project documentation (noted in material findings)
• ⚠Contradictory leakage justification: verification report (2016) states 'quantified' while monitoring report (2014) states 'deemed negligible', yet the deduction is 0%
• ⚠Contradictory baseline method: verification report (2016) says project-specific, monitoring report (2014) says jurisdictional
• ⚠ERR discrepancy between documents: 3,543 tCO₂e (verification report 2016) vs 2,340 tCO₂e (monitoring report 2014)

Credit Vintages Exhausted