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WRI/WBCSD GHG Protocol: Project Module

WRI/WBCSD GHG Protocol: Project Module. Jeff Fiedler (jfiedler@nrdc.org) Natural Resources Defense Council Ag Modeling Forum, October 13, 2004. GHG Protocol: Project Module. Multi-stakeholder, int’l, 2-year process Road-tested; final revisions before public comment Purpose:

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WRI/WBCSD GHG Protocol: Project Module

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  1. WRI/WBCSD GHG Protocol:Project Module Jeff Fiedler (jfiedler@nrdc.org) Natural Resources Defense Council Ag Modeling Forum, October 13, 2004

  2. GHG Protocol: Project Module • Multi-stakeholder, int’l, 2-year process • Road-tested; final revisions before public comment • Purpose: • Simple & credible project quantification • Reduce uncertainty and transaction costs • Increase consistency across projects, programs • Program- and policy-neutral for broad applicability • Protocol is not a verifiable standard: • Flexibility means that inconsistency is likely • Interpretation required by projects and programs • Value: Discussion, guidance on trade-offs

  3. Baselines & Additionality • Additionality is a critical concept for credibility, integrity of reported reductions • Baselines: Key to additionality • Project Specific: Identify possible baseline candidates, and use barriers tests to select most likely baseline • Performance Standard: Key steps are baseline sample (geographical, temporal, technology) and setting the stringency (10th percentile?) • Flexibility: Approach, stringency, sample…

  4. Application to Forests & Ag • Project Specific is relatively straightforward • Performance Standard can be used to: • Determine rate of change of land use practices • Use appropriate sample to estimate baseline rate • Sector guidance will discuss geographic area, temporal range, method of projecting rate of change (trend, model), stringency • Carbon stocks still measured/estimated • Considerable judgment is needed; uncertainty • Estimate C stock change for a land use change • For heterogeneous areas, use sample to estimate stock change per unit area, for a given activity or land use change

  5. Leakage and Secondary Effects • Protocol differs from other programs, which… • Define project boundary (but how? ownership?) • Leakage is an effect outside project boundary • Leakage is integrated into project assessment: • Define project’s primary activity and effect • Identify secondary effects using guidance: • Upstream/downstream • Leakage (activity shifting, market effects) • Quantify all elements, including leakage (within reasonable limits recognizing evolving tools) • Provides greater clarity on assessment boundary

  6. Permanence/Reversal • Carbon Reversibility Management Plan • Identify, assess reversible elements of project • Describe actions to reduce reversibility • Easements, prevention, contracts • Describe mechanisms to compensate for loss • Insurance, portfolio, buffer/reserve • Reversibility monitoring plan • Crediting programs and private contracts will determine liabilities and project requirements

  7. 1605(b) Federal Registry • Baselines: Inconsistency is guaranteed • Multiple definitions (Section 300.8) • No definitions on stringency, criteria • “Reductions” for C storage above base year • Leakage: Attempted entity-wide reporting • Loose definition of “distinct entity” • Only addresses issue if reporting is mandatory • Indirect Emissions • Good to separate direct, energy indirect, other indirect • Permanence: ???

  8. 1605(b) – Other Issues • Transparency: What level of documentation? • Emissions reporting, baseline selection, leakage…? • De minimis exemptions? • Minimal review of reports by EIA • Registering vs. Reporting? • Big Picture: • Flaws of existing 1605(b) will continue • Doesn’t provide certainty for business • Doesn’t provide useful information for policy makers • Sets terrible precedent for future crediting programs

  9. CA Registry – Forest Protocol • Baselines: Not generally applicable • Assumes legal standard defines current land use • Baseline not updated as law evolves • Leakage: • Limited treatment creates bad precedent • Permanence: • Requires annual monitoring; tracks losses

  10. My Ideal Ag Sector Analysis • What is the effect of mandatory policies? • Mirror structure of McCain-Lieberman • Use relevant targets and timetables • Use range of carbon and energy prices • Costs and benefits (e.g., new markets) • Outputs: • Net farm income • Overall “market” size: how many gallons of ethanol? • Regional distribution • Soil, water, wildlife, other benefits

  11. Ag Sector Analysis (2) • Elements of analysis: • Carbon cap on electricity, transport fuels, large sources: • Renewables (on-farm wind; biomass energy) • Methane to Energy • Offsets: Include transaction costs of monitoring, rules • Sequestration • Nutrient management • Methane capture/reductions • Incentives Payments • Energy Price: • Fertilizer & Pesticide (natural gas) • On-farm fuel & energy use

  12. Ag Sector Analysis (3) • Analytical Difficulties? • How to interact with economic studies? • Do you use all outputs in an ag analysis? • Studies can project levels of offsets, renewables use • Regional distribution? • One analysis, or multiple coordinated elements? • If separate, how to capture the effect of revenue from new markets?

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