B 3.1: Guidelines for the Monitoring, Reporting and ...1067656943.n159491.test.prositehosting.co.uk/wp-content-sec/... · Understand the importance of a monitoring system; ... Reporting

B 3.1: Guidelines for the Monitoring, Reporting and Verification of Greenhouse Gas Emissions

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About the Project "Emissions Trading System: Capacity Building" is a programme of the German

Ministry for the Environment [BMUB], in cooperation with the German

Emissions Trading Authority [DEHSt] and leading German emissions trading

experts, to share knowledge and experience to help interested countries

establish an emissions trading system. Fundamental principles and “best

practices” of emissions trading are offered with a focus on the EU and German

experiences. Participants gain the necessary expertise to develop and

implement concepts to design their own national ETS.

The programme offers training modules in selected countries and in Germany

and has been specially designed for experts and policy makers. The

programme comprises a number of modules that can accommodate individual

interests and prior knowledge of participants.

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Content

• Goal and Objectives

• Why Monitoring & Reporting

• Background

• Overview of Monitoring and Reporting Process

• Monitoring Plan

• Emission Report

• Determination & Verification Process

Module B 3.1: Guidelines for the Monitoring, Reporting and Verification of Greenhouse Gas Emissions

4

Content



• Background


• Monitoring Plan

• Emission Report



5

Goal & Objectives

• Goal of this presentation is to deliver an overview of the existing MRV system under the European Emissions Trading Scheme 2013-2020.

• Objectives are to:

Understand the importance of a monitoring system;

Become familiar with the main design features of the process;

Get to know who are the main actors in this system & who is responsible for what;

How to build such a system at home;

Use that experience also for data acquisition for preparing decisions on Emissions

Trading Scheme and Allocation planning.


6

Content



• Background


• Monitoring Plan

• Emission Report



7

Why Monitoring & Reporting?

• ETS gives flexibility to the operators …

… allows emissions to be cut where cheapest!

• Flexibility ends when actual emissions must be reported.

• Operators must surrender allowances on the basis of annual Monitoring & Reporting.

• Monitoring & Reporting – „The flip side of the coin“

… free allocation vs. compliance costs

• Monitoring principle: „One tonne CO2 emitted must be one tonne CO2 reported.“


You can only control, what you can measure!

8

Content



• Background


• Monitoring Plan

• Emission Report



9

EU ETS Legal Framework - Overview

Module B 3.2: Institutional & Legal Framework of the EU Emissions Trading System (ETS)

Emissions Trading Directive

(2003/87/EC)

Linking Directive

JI-/CDM projects

(2004/101/EC)

Directive amending

EU ETS from 2013 onwards

(2009/29/EC)

Directive

on aviation

(2008/101/EC)

EC Decision

on free

allocation

of emission

allowances

(2011/278)

EC Regulation

on auctioning

of GHG

emissions

(1031/2010)

EC Decision

on list of

sectors and

subsectors

which are

deemed to be

exposed to

a significant

risk of carbon

leakage

(2010/2)

EC Regulation

of establishing

a Union

Registry

(No 389/2013)

EC Regulation

on the

verification of

greenhouse gas

emission reports

and

tonne-kilometre

reports and the

accreditation

of verifiers

(No 600/2012)

EC Regulation

on the

monitoring

and reporting

of greenhouse

gas emissions

(No 601/2012)

EC Regulation

on determining

international

credit

entitlements

(No 1123/2013)

EC Decision

on the effort

of Member States

to reduce their

greenhouse gas

emissions to

Meet the

Community’s

greenhouse gas

emission

reduction

commitments

Up to 2020

(No 406/2009)

EC Regulation

on

establishing a

scheme for

GHG emission

allowance

trading in view

of the

implementation

by 2020 of an

international

agreement

applying

a single global

market-based

measure to

international

aviation

emissions

(No 421/2014)

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Background

• Robust, simplified, transparent, consistent and accurate monitoring and reporting of GHG emissions is essential!

• The Monitoring and Reporting Regulation (MRR) of the EU entered into force on 1 August 2012 and applies to emissions monitoring from 1 January 2013 on. It replaces the Monitoring and Reporting Guidelines (MRG) of the EU which were adopted in 2004 (revision 2007).

• The MRR provides the regulatory framework for the monitoring and reporting of GHG emissions within the ETS in the third trading period. Its regulations are directly applicable to all member states and to all participants.


Monitoring and calculating CO2 emissions & emission reports are

essential elements of the emissions trading system!

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Content



• Background


• Monitoring Plan

• Emission Report



12

Overview: Allocation, MRV, Compliance

8. CO2-

Monitoring

2. Allocation

Application 3. Verification of

Allocation Application

4. Allocation

Decision

1. Definition Legal

Framework,

Scope, GHG

permission

7. Issuance of

Allowances

9. Emission Report

11. Submission

of Emission

Report

13. Obligatory

and in-depth

checks Steps 7-14 are repeated annually!

10. Verification of

Emission Report

14. Surrender of

Allowances

Plant Operator

Verifier Legislative Body Competent Authority

Source: FutureCamp 2014


12. Entry into

Registry (VET)

5. Establishment of

Monitoring Plan 6. Approval of

Monitoring Plan

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Content



• Background


• Monitoring Plan

• Emission Report



14

Step 5: Establishing a Monitoring Plan

8. CO2-

Monitoring

2. Allocation



4. Allocation

Decision

1. Definition Legal

Framework,

Scope, GHG

permission

7. Issuance of

Allowances

9. Emission Report

11. Submission

of Emission

Report

13. Obligatory

and in-depth


10. Verification of

Emission Report

14. Surrender of

Allowances

Plant Operator




12. Entry into

Registry (VET)

5. Establishment of


Monitoring Plan

The operator must: • Reveal monitoring method (calculation or measurement); • Explain whether and how MRR requirements are met; • And where the method deviates from the MRR.

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Step 5: Monitoring Plan (2013-2020)

• Existing installations: installation-specific monitoring plan (MP) shall be developed before start of the monitoring period.

• New entrant installations: MP has to be submitted before start of operation

• MP is the basis for the emission reports.

• MP to be submitted to competent authority for approval before start of the monitoring period.

• MP is compiled using standardized electronic templates. In Germany this is done by application of a national form management system (FMS).

• DEHSt has published special guidance documents for this.


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Monitoring Plan: Design and Content

Monitoring Plan Supporting documents

General plant information

Summary of process instructions

Proof of meeting tier requirements

Results of risk analysis

Information on changes and updates

Documentation of methods

• Calculation-based methodology • Measurement-based methodology • Categorisation of source streams • Calculation factors • Emission sources

Procedures / Process instructions

• Data management • Control system • Sampling plan • Analysis • QA for measurement instruments • ...


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Methods for CO2 Emissions Determination


A combination of methods is possible.

Calculation-based methodology

Measurement-based methodology

Standard Methodology Mass balance Methodology

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Standard Methodology


Fuels for combustion

Process input materials

products

waste

actorOxidationFctorsEmissionFamsInputStreaEmissions **

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Combustion Emissions Determination

• Formula for calculating:

• Oxidation factor for Germany is 1.

• Determination of the emission factor and net calorific value:

– Commercial standard fuels and small installations – using standard factors from

German regulation, e.g.:

– Other fuels & large installations – calculation is done by analysing fossil C-content &

net calorific value. Invoicing data from supplier can be used if information relevant for

tier requirements is available.


actorOxidationFctorEmissionFaicValueNetCalorifFuelFlowEmissionsCombustionCO ***2

Natural gas 0.056 t CO2/GJ 36.0 GJ/1.000 Nm3

Mine gas 0.055 t CO2/GJ 17.8 GJ/1.000 Nm3

Fuel oil, light 0.0741 t CO2/GJ 42.6 GJ/t

Fuel oil, heavy 0.0809 t CO2/GJ 39.5 GJ/t

Raw lignite 0.099-0.114 t CO2/GJ 8.8-10.7 GJ/t

Biomass 0.000 t CO2/GJ - -

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Material Flows Emissions Determination

• Formula for calculating:

• Determination of the emission factor:

– For small installations – using a product standard factor according to MRR and

German regulation, e.g.:

• Cement clinker 0.525 t CO2/t

• Gypsum 0.258 t CO2/t

– For large installations – emission factor shall be determined on-site e.g. by lab.

analysis at the plant. Invoicing data from supplier can be used if information relevant

for tier requirements is available.


FactorConversionctorEmissionFataActivityDa

ionocessEmissCO

**

Pr2

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Mass balance


∑CInput ∑COutput

)(* OutputInput CCfEmissions

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Continuous Emissions Measurement


Concentration

Volume flow CO2e

Emissions

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Tier Approach in Monitoring Plan and Reports

• Principle:

– Each tier has a number (1-4), having been allocated per parameter and activity.

– Selection of tier depends on the amount of annual total emissions of the

installation in the previous emissions trading period.

• Rule: higher number of tier and higher total emissions require higher accuracy level.

• Plants > 50,000 t annual emissions (Category B and C) must generally meet the

highest level of accuracy, meaning tier 4


The tier approach defines the accuracy level for each parameter

per activity.

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Tier Approach: Categorised according to CO2 Emissions


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A B C

CO2 emissions [in 1,000t/a] 500

Tiers for Activity Data for Category A Facilities and

Commercial Standard Fuels

Sourc

e:

Excerp

t fr

om

A

nnex V

and A

nnex I

I M

RR

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Calculation Method: Categories and Tiers


Category C 1 tier lower

possible

Commercial

standard

fuels

Up to 2 tiers lower

possible

Highest

Tier as per

Annex II

Fall-

bac

k A

pp

roac

h

Further

facilitations

Lower tier possible

for transition period

(up to 3 years);

plan for achieving

required tier

necessary

Minimum requirement Tier 1

Minimum

require-

ments as

per Annex

V

Category B

Category A

Small

emitters

if this is technically not feasible or incurs unreasonable costs

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Step 5: Establishing a Monitoring Plan

8. CO2-

Monitoring

2. Allocation



4. Allocation

Decision

1. Definition Legal

Framework,

Scope, GHG

permission

7. Issuance of

Allowances

9. Emission Report

11. Submission

of Emission

Report

13. Obligatory

and in-depth


10. Verification of

Emission Report

14. Surrender of

Allowances

Plant Operator




12. Entry into

Registry (VET)

5. Establishment of


Monitoring Plan

The operator must: • Reveal monitoring method (calculation or measurement); • Explain whether and how MRR requirements are met; • And where the method deviates from the MRR.

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Example Power Plant: Process Overview

CO2 - emission for combustion & process (desulphurisation)

Ammonia

Chimney

Desulphuri-sation Lime

susp.

Combustion Air Boiler

Condenser

E-Filter

Denox

Gypsum

Coaldust

Air and Steam

CO 2

Steam

Cooling Tower

Air

Cooling-Water Circuit River

Source: www.leifiphysik.de

Module D 1: Guidelines for the Monitoring, Reporting and Verification in the Energy Sector

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Example Power Plant: Source Stream Diagram

Boiler silo

Boiler A Boiler B

NG Oil

Lime Coal pile Coal

Delivery silo Coal

Waste

Desulph-

urisation

CO2

System boundary

Coal mass balance

Source: eins energie in sachsen GmbH & Co. KG Chemnitz


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Example Power Plant: Identify Requirements


Category C plant

Gas-fired power plant with total emissions of ≥ 500,000 t CO2/yr

CO2 Emissions = Activity data * Emission factor * Oxidation factor

Tier 4 Tier 3 Tier 3 Tier 1

Amount of fuel (ex: Gas) * NCV

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Example Power Plant: Activity Data


Tier 4

The fuel consumption over the reporting period shall be determined by the operator or fuel

supplier within a maximum uncertainty of less than ± 1.5% taking into account the effect of stock

changes where applicable.

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Example: Requirements Emission Factor


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Example: Requirements Net Calorific Value


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Sampling & Analysis

Implementation and Quality Assurance

• For Sampling & Analysis, applied methods shall be based on EN standards (alternatively,

ISO or national standards, industry best practice guidelines)

• Batch specific sampling & analysis, consistency in applying calculation factors to

underlying fuel/material streams/batches, for which they are representative

• Establish sampling plan: written procedure, including sampling method, location,

frequency, quantities, responsibilities, method for storage and transport

• Adapt sampling plan in case of high heterogeneity of fuel/material

• Laboratory shall be accredited in accordance with EN 17025

• If not available, demonstrate that the non-accredited laboratory meets equivalent requirements

• Frequencies for analysis

• As listed in Annex VII of the monitoring regulation

• Alternative: Demonstrate that variation of parameter < 1/3 of uncertainty threshold set by tier

concept for respective activity data


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Example: Small Power Plant’s Monitoring Requirements

Category A plant

Gas-fired power plant with total emissions of < 50,000 t CO2/yr

CO2 Emissions = Activity data * Emission factor * Oxidation factor


Tier 2 Tier 2a/2b Tier 1

Amount of fuel (ex: Gas) * NCV

Tier 2a/2b

Source: BMU/DEHSt, December 2011

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Example: Small Power Plant’s Monitoring Requirements


Tier 2

The fuel consumption over the reporting

period shall be determined by the operator

or fuel supplier within a maximum

uncertainty of less than ± 5 % taking into

account the effect of stock changes where

applicable.

Tier 2a/2b

• Country-specific NCV or

• For commercially traded fuels the NCV as derived

from the purchasing records for the respective fuel

provided by the fuel supplier is used, provided it

has been derived based on accepted

national/international standards.

Tier 2a/2b

• Country-specific emission factors (EF) or

• EF is derived by the density measurement

of specific oils or gases common, e.g. to the

refinery or steel industry, and

• EF is derived by the net calorific value for

specific coal types.

Tier 1:

Standard Oxidation

factor of 1 is used.

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Uncertainty Assessment

• Simplified approaches:

• Measuring instrument is subject to national legal metrological control:

Overall uncertainty = Maximum permissible error in service

• In case of calibrated devices the operator has to show that all requirements

of the following four steps are met:

• Step 1: Operating conditions regarding relevant influencing parameters are

available

• Step 2: Operating conditions regarding relevant influencing parameters are met

• Step 3: Performing quality assured calibration procedures

• Step 4: Further quality assurance procedures for measuring activity data

• In other cases the operator has to carry out a specific uncertainty

assessment

Module B 3.1: Guidelines for the Monitoring, Reporting and Verification of Greenhouse Gas

Emissions

47

Frequencies for analyses

• Minimum frequencies for analyses for

relevant fuels and materials listed in Annex

VII MRR

• Use of a different frequency allowed where

minimum frequencies are not available or

where the operator demonstrates one of

the following:

– Any variation in the analytical values

for the respective fuel or material does

not exceed 1/3 of the uncertainty value

to which the operator has to adhere

with regard to the activity data

determination of the relevant fuel or

material

– using the required frequency would

incur unreasonable costs


48

Typical Problems for Companies with ETS Introduction

• Inside of a company: extent of issue sometimes underestimated:

– Often treated as classical „environment issue“, underestimating financial relevance;

– Lack or only slow provision of personal and / or financial capacities;

– Necessary processes not defined (e.g. “who is responsible for what?”);

– Sometimes also excessive care for minor important (technical) details;

– Lack of or not well defined internal management systems.

• Related to government action beyond MRV:

– High time pressure;

– Belated release of legal prescriptions / other requirements;

– Some important business regulation appeared only with considerable delay

(e.g. treatment of EUAs within taxes and balances for companies).

• Conditions like:

– Delay of registries;

– High dynamics in regulatory environment.

• Problem for performance and

intra-company acceptance!


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Steps 6: Approval of Monitoring Plan

8. CO2-

Monitoring

2. Allocation



4. Allocation

Decision

1. Definition Legal

Framework,

Scope, GHG

permission

7. Issuance of

Allowances

9. Emission Report

11. Submission

of Emission

Report

13. Obligatory

and in-depth


10. Verification of

Emission Report

14. Surrender of

Allowances

Plant Operator




12. Entry into

Registry (VET)

5. Establishment of


Monitoring Plan

• The monitoring plan has to be submitted once to the competent authority for approval before starting the operation.

• In case of adjustments of the monitoring plan which are subject to authorization, reapproval necessary.

50

Step 8: CO2 Monitoring

8. CO2-

Monitoring

2. Allocation



4. Allocation

Decision

1. Definition Legal

Framework,

Scope, GHG

permission

7. Issuance of

Allowances

9. Emission Report

11. Submission

of Emission

Report

13. Obligatory

and in-depth


10. Verification of

Emission Report

14. Surrender of

Allowances

Plant Operator




12. Entry into

Registry (VET)

5. Establishment of


Monitoring Plan

• Plant operator is obliged to monitor his emissions on the basis of the approved monitoring plan and to report them in Step 9.

• Information regarding the methods for CO2 emissions determination has been already provided in Step 5.

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Content



• Background


• Monitoring Plan

• Emission Report



52

Step 9: Emission Report

8. CO2-

Monitoring

2. Allocation



4. Allocation

Decision

1. Definition Legal

Framework,

Scope, GHG

permission

7. Issuance of

Allowances

9. Emission Report

11. Submission

of Emission

Report

13. Obligatory

and in-depth


10. Verification of

Emission Report

14. Surrender of

Allowances

Plant Operator




12. Entry into

Registry (VET)

5. Establishment of


Monitoring Plan

53

Step 9: Emission Report

• To be submitted to competent authority by 31 March

• Using available EU Templates or

• Special Software „Formular Management System“ (FMS), which must be used in Germany. It:

– Provides automatic checks;

– Reduces potential for errors (data import from monitoring plans);

– Increases cost-effectiveness of checking reports on the part of DEHSt and

– Facilitates verifiers‘ work.

• Guidance for reporting is given by:

– Guideline of EU or the national authority (DEHSt);

– User manual of FMS;

– Downloads on DEHSt homepage (e.g. FAQs, etc.).


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Content of the Emission Report

• General information about the plant;

• Address data (operator, responsible person, responsible authority, verifier);

• Description of the plant sections;

• For each operation carried out, following data should be defined:

– Activity data;

– Net calorific value;

– Emission factors;

– Oxidation factors;

– Actual annual CO2 emissions;

• Information regarding the reporting period;

• Reference to monitoring methodology and plan;

• CO2 emissions reporting according to plant sections;

• Verification report.


Example of an emission report

59

Step 10: Verification of Emission Report

8. CO2-

Monitoring

2. Allocation



4. Allocation

Decision

1. Definition Legal

Framework,

Scope, GHG

permission

7. Issuance of

Allowances

9. Emission Report

11. Submission

of Emission

Report

13. Obligatory

and in-depth


10. Verification of

Emission Report

14. Surrender of

Allowances

Plant Operator




12. Entry into

Registry (VET)

5. Establishment of


Monitoring Plan

Angelika Smuda

Federal Ministry for the Environment, Nature Conservation, Building and Nuclear SafetyDivision KI I 3 – Legal Issues Climate Policy, Emissions Trading

Felix Nickel

FutureCamp Climate [email protected]

Documents

B 3.1: Guidelines for the Monitoring, Reporting and ...1067656943.n159491.test.prositehosting.co.uk/wp-content-sec/... · Understand the importance of a monitoring system; ... Reporting