1. PROFESSIONAL OPPORTUNITIES IN ENVIRONMENTAL LAWS, GREEN
AUDIT & CARBON RELATED AREAS CA. Rajkumar S. Adukia 098200
61049 [email protected][email protected]
1
2. Professional Opportunities in Carbon Credit 1.
Conceptualizing the Clean Development Mechanism (CDM) project 2.
Quantification of greenhouse gases (GHG) Carbon Footprint 3.
Selection of Cleaner technologies for New projects 4. Project risk
analysis 5. Registration of project - both national and
international level 6. Obtaining Host country approval 7.
Preparation of Project Concept Note 8. Preparation of Project
Design Document [email protected] 2
3. Professional Opportunities in Carbon Credit 9. Selection of
Methodologies and Baseline 10. Legal and regulatory advice during
negotiations with host country Designated National Authority (DNA)
11. Advice on the appointment of independent validators 12.
Assistance to achieve registration of the project by the CDM
Executive Board 13. Assistance in getting verification done by
Designated Operational Entity (DOE) 14. Ensure Compliances 15.
Assisting various Ministries associated with National Action Plan
on Climate Change (NAPCC) [email protected]
3
4. Professional Opportunities in Carbon Credit 16. Carbon
Finance 17. Energy Audit under The Energy Conservation Act 2001 18.
Advise on investment in carbon credit 19. Accounting advisory
services 20. Taxation advisory services
[email protected] 4
5. Professional Opportunities in Environmental Laws and Green
Audit 1. As Environmental Consultants - give opinion on viability
of various projects, technologies to prevent pollution and clean up
polluted resources 2. Obtain consents for establishment of Unit 3.
Submission of Gross Block investment certificate along with the
consent application for establishment of a Unit. 4. Environmental
clearance under the Environment Impact Assessment Notification. 5.
Record keeping of various hazardous wastes, chemicals etc, as
prescribed under the Hazardous Wastes (Management and Handling)
Rules, 1989 and Manufacture, Storage, and Import of Hazardous
Chemicals Rules, 1989. [email protected] 5
6. Professional Opportunities in Environmental Laws and Green
Audit 6. Status of compliance of Rules 5, 7, 10,11,12,13 and 18
under the Manufacture, Storage, and Import of Hazardous Chemicals
Rules, 1989 need to be given in the application for consent to
establish/operate/renewal of consent. This status of compliance can
be given by Chartered Accountants in the form of a certificate of
compliance. a. Rule 5 Notification of major accident b. Rule 7
Notification of sites c. Rule 10 Preparation and submission of
safety report d. Rule 11 Updation of safety report
[email protected] 6
7. Professional Opportunities in Environmental Laws and Green
Audit e. Rule 12 Requirements of further information to given to
the authority f. Rule 13 Preparation of on-site emergency plan by
the occupier g. Rule 18 Import of hazardous chemicals 7. After
consent to establish/operate is obtained under the Water
(Prevention and Control of Pollution) Act, 1974 and Air (Prevention
and Control of Pollution) Act, 1981, CA can ensure on a
monthly/quarterly/half-yearly basis that the conditions of the
consent order are complied with by the industrial unit.
[email protected] 7
8. Professional Opportunities in Environmental Laws and Green
Audit 8. CA can also ensure on a monthly/ quarterly/ halfyearly
basis that the conditions of the authorization are complied by the
industrial units under the Hazardous Wastes (Management and
Handling) Rules, 1989. 9. Give report or certificate with regard to
capital investment under the Biomedical waste (Management and
Handling) Rules, 1998. This is an important document to be
submitted along with the application for authorization. 10.
Environmental Audits [email protected] 8
9. WHY CARBON CREDIT CAME INTO EXISTENCE GEOGRAPHICAL BOUNDARY
CAN BE DIVIDED ATMOSPHERE IS INDIVISBLE WORLD DISCUSSION STARTED ON
HOW TO MITIGATE CLIMATE CHANGE VARIOUS ALTERNATIVES DISCUSSED WHO
ARE RESPONSIBLE FOR CLIMATE CHANGE ?
[email protected] 9
10. Climate Change Temperature Increase of 0.4O C in last 100
years. Increase in monsoon seasonal rainfall across West Coast, AP
Decrease in monsoon in North East India, Kerala Climate Models
predict 2-4 O C rise by 2050s [email protected]
10
12. Effects of changing climate A decrease in the quantity and
quality of water in many arid and semi-arid areas A decrease in the
reliability of hydropower and plantation biomass. An increase in
the loss of species and degradation of key ecosystems such as coral
reefs, which play a critical role in the economy of some developing
countries; The displacement of tens of millions of people in
low-lying areas An increased threat in national and regional
security because of the loss of natural resources and the potential
flow of environmental refugees An increase in the incidence of
vector-borne diseases (e.g., malaria and dengue), water-borne
diseases (e.g., cholera), and malnutrition throughout the tropics
and sub-tropics, where millions of lives are rajkumarfcalost every
year; [email protected] 12
13. Effects of changing climate A decrease in agricultural
productivity in the tropics and sub-tropics. For low-lying areas in
the world, the threat of climate change is a matter of survival.
The sea level could rise by one meter over the next century, which
would have the following consequences In countries with significant
low-lying areas, coastal communities would be severely threatened.
For example, 17% of the land area of Bangladesh would be lost and
tens of millions of people displaced. The survival of low-lying
small island states would be in doubt, in particular for the many
island states in the Indian and Pacific Ocean and Caribbean that
are only a few meters above sea level. While no one will be able to
escape from climate change, it is the poorer people and countries
who are most vulnerable to its negative impacts.
[email protected] 13
16. Key Words Global warming is the increase in the average
temperature of the Earth's near-surface air and oceans in recent
decades and its projected continuation. GHG: Green House Gases (eg.
Carbon dioxide, Methane, Nitrous oxide, HFC 23, Sulphur
hexafluoride and Per fluoro carbons) UNFCCC: United Nations
Framework Convention on Climate Change KP: Kyoto Protocol CERs: A
certified emission reduction or CER is a unit issued pursuant to
reduction in GHG emissions equal to one metric tonne of carbon
dioxide equivalent, calculated using global warming potentials
defined by UNFCCC. Clean development mechanism (CDM) : Article 12
of the Kyoto Protocol defines the CDM as. The purpose of the clean
development mechanism shall be to assist Parties not included in
Annex I in achieving sustainable development and in contributing to
the ultimate objective of the Convention, and to assist Parties
included in Annex I in achieving compliance with their quantified
emission limitation and reduction rajkumarfcacommitments.
[email protected] 16
18. Global Initiative to Mitigate CC United Nations Conference
On Human Environment (1972) Vienna Convention For Protection Of
Ozone Layer (1985) Montreal Protocol (1987) Intergovernmental Panel
on Climate Change (1988) United Nations Conference on Environment
And Development (1992) at Rio Conference Of The Parties To The
UNFCCC ( from 1995 ) Kyoto Protocol (1997) Marrakesh Accord ( 2001
) World Summit on Sustainable Development ( WSSD ), 2002 Global
Environment Facility ( GEF ) rajkumarfcaPrototype Carbon
[email protected] Bank, 2002 Fund (PCF), World 18
19. United Nations Framework Convention on Climate Change
(UNFCCC) UNFCCC An international environmental treaty entered into
force on 21st March 1994. Signed by 154 states (plus the EU) in
1992 Currently 195 parties have ratified UNFCCC Based on three
principles 1. Common but differentiated responsibility; 2.
Precautionary approach; 3. Sustainable Economic Growth and
Development. Divides countries into two main groups - Annex I
(Developed) & Non-Annex I Countries (Developing). Under the
UNFCCC, the Annex I parties, consisting of highly industrialized
countries and countries undergoing transition to a market economy,
have legally binding greenhouse gas (GHG) emission limitation and
reduction rajkumarfcacommitments while developing countries have
non-binding [email protected] 19 obligations to limit
emissions.
20. Kyoto Protocol Its an addition to the UNFCCC Treaty. Is an
international and legally binding agreement It was negotiated in
Kyoto, Japan and entered into force on 16th February 2005 It
assigns mandatory targets for signatory nations to reduce their
emission of the specified 6 greenhouse gases, or engage in
emissions trading if they maintain or increase emission of these
gases. Annex I (developed countries) parties of the UNFCCC have
agreed to reduce their GHGs by 5.2 % below 1990 levels in the
Protocols 1st commitment period The first commitment period under
this Protocol starts rajkumarfcafrom calendar year 2008 to calendar
year end 2012. [email protected] 20
23. Kyoto Protocol The Flexibility Mechanisms Provides for 3
co-operative implementation mechanism. 1) Joint Implementation
(JI), (which allows countries to claim credit for emission
reduction that arise form investment in other industrialized
countries, which result in a transfer of 'emission reduction units'
between countries ) 2) Clean Development Mechanism (CDM), (through
which industrialized countries can finance mitigation projects in
developing countries contributing to their sustainable development
) 3) International Emissions Trading (ET) (which permits countries
to transfer parts of their 'allowed emissions' assigned amount
units ) [email protected] 23
24. India & Carbon Credits India ratified UNFCCC on 1st
November 1993. India ratified Kyoto Protocol on 26th August 2002
The Ministry of Environment and Forests, Government of India, is
the nodal agency for climate change issues in India. The National
Action Plan on Climate Change (NAPCC), was released by the Prime
Minister on 30th June, 2008 India is being heralded as the next
carbon credit destination of the world. On 7th September 2012, the
one billionth CER credit under the KPs CDM was issued to a project
at a manufacturing plant in India that has switched its fuel source
from coal and oil to locally gathered biomass.
[email protected] 24
25. Indias National Action Plan on Climate Change (NAPCC) NAPCC
was released on 30th June, 2008 It is A National Document compiling
action taken for addressing the challenge of Climate Change, and
the action it proposes to take The Action Plan, would be
implemented through a core of eight National Missions running
through 2017: 1. National Solar Mission 2. National Mission for
Enhanced Energy Efficiency 3. National Mission on Sustainable
Habitat 4. National Water Mission 5. National Mission for
Sustaining the Himalayan Ecosystem 6. National Mission for creating
a Green India) 7. National Mission for Sustainable Agriculture 8.
National Mission on establishing a Strategic Knowledge Platform for
Climate Change. [email protected] 25
26. Contd The Prime Ministers Council on Climate Change is in
charge of the overall implementation of the plan. The Council will
also be responsible for periodically reviewing and reporting on
each missions progress. The Council is Chaired by the Prime
Minister. The NAPCC consists of several targets on climate change
issues and addresses the urgent and critical concerns of the
country. The National Missions were to be institutionalized by the
respective Ministries and would be organized through inter-sectoral
groups. [email protected] 26
27. Contd. Each Mission was to evolve specific objectives
spanning the remaining years of the 11th plan period at the time it
was laid down and the 12th Plan Period and each Mission will report
publicly on its annual performance. Ministries with lead
responsibility for each of the missions are directed to develop
objectives, implementation strategies, timelines, and monitoring
and evaluation criteria, to be submitted to the Prime Ministers
Council on Climate Change. Each Mission will report publicly on its
annual performance All the missions have been implemented and
progress is rajkumarfcabeing made [email protected] 27
[email protected] 27
28. Clean Development Mechanism (CDM) CDM offers industrialized
countries the possibility to engage in economically and
environmentally competitive emission reduction projects in
developing countries (the NonAnnexure I countries). Through the
CDM, certified emission reductions (CERs) will be generated. These
CER credits, each equivalent to one tonne of CO2, can be can be
traded and sold, and used by industrialized countries for the
purpose of being counted towards meeting Kyoto targets.
[email protected] 28
29. Institutional Framework The CDM is administered by the CDM
Executive Board (CDM Board) CDM Board reports and is accountable to
the Conference of Parties (COP). Developing country is the Project
Developer also known as the Host Party/Country Annexure 1 countries
are the Investors The project has to be first approved by
Designated National Authority (DNA) of the Host country where the
project is being set up. [email protected]
29
30. Contd The Designated National Authority (DNA) in India is
the National Clean Development Mechanism Authority (NCDMA) An
institution which verifies the essential prerequisites for CDM
projects and certifies the emission reductions is the Designated
Operational Entity (DOE) [email protected]
30
31. Project requirements Must promote sustainable development
as defined by host countries Emission reductions must be: Real
Measurable Additional Funding for CDM must not divert funds from
existing government development programs
[email protected] 31
32. Carbon Credits Carbon credits are reductions of emission of
Green House Gases (GHGs) caused by a project. 1 M ton CO2 = 1
carbon credit = 1 CER [Certified Emission Reduction Unit in CDM
terminology] The reduction is achieved by improved and modern
technology and process. VER Voluntary/Verified Emission reductions
(For non registered Projects) [email protected]
32
33. Host country eligibility requirements Ratified Kyoto
Protocol Designate a DNA - Designated National Authority Approves
CDM projects Confirms project in line with countrys sustainable
development agenda. Confirms project in accordance with all laws
Reviews PDD to see if complete Approval process not set by CDM.
Each country allowed to determine own rules
[email protected] 33
34. Methodologies Incineration of HFC 23 waste streams Analysis
of the least cost fuel option for seasonality operating biomass
cogeneration plants Recovery & utilization of gas from oil
wells that would otherwise be flared. Natural Gas based package
cogeneration Steam system efficiency improved by replacing steam
traps. Baseline methodology for decomposition of N20 from existing
adipic acid production plants Method for zero emissions grid
connected electricity generation from renewable rajkumarfcasources
[email protected] 34
35. Methodologies Methodology from greenhouse gas reductions
through waste head recovery & utilization for power generation
at cement plants Avoid emissions from organic waste through
alternative waste treatment processes Substitute of CO2 from fossil
or mineral origin by CO2 from renewable sources in the production
of inorganic compounds Methods for bus rapid transit projects
Methane emissions reduction from organic waste, water and
bio-organic solid waste using composting Afforestation and
reforestation activities [email protected]
35
36. Small Scale CDM Projects Power projects upto 15 mega watts
Energy saving of 60 giga watts hours per year Reduction of 60 kt
CO2 per year. A & R Sequestration of 8 kt CO2 It should not be
debundled component of large methodology Approved Simplified
Methodologies by CDM EB Same DOE can undertake validation,
verification and certification Bundling of projects feasible
[email protected] 36
37. CDM Project Cycle - Basics Preparation of PIN - DNA
Preparation of PDD - UNFCCC Project Validation By UNFCCC Accredited
DOE Host Country Approval To the Candidate Project ONE TIME
ACTIVITY Submission for Registration (UNFCCC CDM Executive Board)
Project Performance Monitoring by Project Proponent RECURRING
ACTIVITY Certification & Issuance of CERs (DOE & UNFCCC)
[email protected] 37
38. CDM Registration Step 1: PDD submission Project Design
Document Presents information on the essential technical and
organizational aspects of project activity Contains information on
activity, application of approved baseline and monitoring
methodologies Submitted to DOE, which decides on validity. Must be
accepted by EB Must demonstrate project will result in net carbon
emission reductions [email protected] 38
39. Baseline Methodology Application of an approach for
determination of baseline scenario Should reflect aspects such as
environmental conditions and past land uses and land-use changes
Must be established in a transparent and conservative manner
Submitted to DOE, which decides on validity. Must be accepted by EB
[email protected] 39
40. The Additionality Test additionality criteria, The emission
reductions of the proposed project must be additional to any that
would occur in absence of the project. Would the project have
happened otherwise? Emission Additionality Financial Additionality
Environmental Additionality Technological Additionality
[email protected] 40
41. Host Country Approval Project must obtain approval from the
host government. The Designated National Authority (DNA) in India
is the National Clean Development Mechanism Authority (NCDMA) The
NCDMA is a single window clearance for CDM projects in the country.
Once the members of NCDMA are satisfied, the Host Country Approval
(HCA) is issued by the Member-Secretary of the National CDM
rajkumarfcaAuthority. [email protected] 41
42. Step 2: Validation and Registration Validation conducted by
a DOE Reviews PDD Validates proposed CDM project and submits a
validation report to EB PDD Written approval of project by DNA
Explanation of response to public comments Registration Requested
by DOE to the EB Registration is final after 8 weeks unless a
review is requested [email protected] 42
43. Step 3: Implementation and Monitoring Project
Implementation Follow methodology written in PDD Monitoring Follow
methodology set in the PDD Complete and submit a monitoring report
Includes estimates of carbon emission reductions Available to the
public [email protected] 43
44. Step 4: Verification and certification Verification
Independent review of emission reductions by a DIFFERENT DOE DOE
submits verification report to EB and is made publicly available
Report covers a specific period Certification Conducted by DOE
Specific period, project achieved certain level of emission
reductions Reductions are additional
[email protected] 44
45. Registration Fee USD 0.10 per CER for the first 15,000
tonnes of CO2 equivalent for which issuance is requested in a given
calendar year; USD 0.20 per CER for any amount in excess of 15,000
tonnes of CO2 equivalent for which issuance is requested in a given
calendar year Maximum Fee USD 350,000 No registration fee to be
paid for CDM project activities with expected average annual
reduction below 15,000 t CO2-equivalent. No registration fee are to
be paid for CDM project activities hosted in least developed
countries [email protected] 45
46. Step 5: Issuance of CERs CER: Certified Emission Reduction
credits Issued after verification and certification by DOE Can be
sold in international emissions reduction market Project review
After credits sold, project can review what steps it wants to take,
e.g.: Dissolution of project Renewal for another crediting period
Change of project participants [email protected]
46
50. TYPICAL Full CDM Cycle Time Frame Registration
Process=TOTAL 8 12 Months [Existing Methodology], 24 Months [for
New Methodology] Project Design Document: Large scale - 3 to 4
months, Small scale PDD : 1 to 2 months Host country approval : 2
to 4 months Validation Registration Adopt an approved methodology :
about 2 months Propose a new methodology : 6 to 12 months Large
scale PDD: 8 weeks after submission unless revision req. Small
scale PDD: 4 weeks after submission unless revision req. Accrual
Process Accrual Process=TOTAL about 14 Months Data Generation
Duration [Say 1 year] Certification About 1 Month
rajkumarfcaInternational Trading & FINAL Receipt of fundsAbout
1 Month [email protected] 50
51. Factors determining CER price Countrys rating in terms of
country risk, credibility and performance of NCDMA The status of
the project The size of the project / offerings of CERs The history
of the project in honouring its commitments to buyers Credit rating
and standing of the project developers No. of project participants
Reputation of project participants The work done by the project
proponents in terms of sustainable development
[email protected] 51
52. Industries having scope of generation of CERs Agriculture
Energy ( renewable & non-renewable sources) Manufacturing
Fugitive emissions from fuels (solid, oil and gas) Metal production
Mining and mineral production Chemicals Afforestation &
reforestation [email protected] 52
53. Carbon Credit Supply Chain (After the advent of Exchanges)
[email protected] 53
56. Transaction Structures contd. Payment on Delivery Buyer
Seller Forward contract @ floating price Option payment future
delivery Buyer Seller Option contract @ Option Purchase Price Spot
Delivery One time payment Buyer Seller One time delivery No Forward
Contract [email protected] 56
57. Accounting Issues In case of self generated CERs What is
the stage at which the carbon credits meet the definition of an
asset? If the carbon credits meet the definition of an asset, then
what is the nature of this asset? If the carbon credits meet the
definition of an asset, then when should the carbon credits be
recognised? If an asset in respect of carbon credits is recognised,
what account should be credited? How should carbon credits, if
these are assets, be measured? How should impairment of these
assets be dealt with in terms of identification and measurement of
impairment How should carbon credits be presented in the financial
statements? [email protected] 57
58. Accounting Issues When should the carbon credits be
derecognised? What should be the treatment of gains and losses on
derecognition? When futures contracts of carbon credits are traded
on an exchange, an issue would arise as to whether these would be
considered as financial instruments within the meaning of AS 30,
Financial Instruments: Recognition and Measurement What would be
the nature of future contracts, which are not covered by AS 30/AS
31 and how they should be accounted for? For purchased CER If an
entity other than the originator/generator of carbon credits,
purchases carbon credits from the exchange for the purposes of
sale, it would be a current asset. Should it be shown as
inventories? Should Accounting Standard (AS) 2, Valuation of
Inventories, be applied to such inventories?
[email protected] 58
59. Stages of asset recognition when the project is registered
entitling it to earn CERs in the future, or when the CERs are
applied for, or when the CERs are actually received, or at any
other point of time like sale of CER?
[email protected] 59
60. Nature of Asset Is it a monetary asset? Or a financial
asset? Or an intangible asset? Or any other type of asset like
inventory? [email protected] 60
61. Measurement of CER Should these be measured at the cost of
earning the CERs at the time of initial recognition or at fair
value? Should subsequent measurement be at cost or fair value? If
these are to be measured at cost, what should be considered as
cost? [email protected] 61
62. Guidance Note on Accounting for Self-generated Certified
Emission Reductions (CERs) Issued by Institute of Chartered
Accountants of India (ICAI) on 11th February 2012 An entity should
apply this Guidance Note for accounting periods beginning on or
after April 01, 2012. Is CER an Asset? CER is an asset as per the
definition given in the Framework for the Preparation and
Presentation of Financial Statements, issued by the ICAI An asset
is a resource controlled by the enterprise as a result of past
events from which future economic benefits are expected to flow to
the enterprise. [email protected] 62
63. Contd When CERs should be recognised in the financial
statements? As per paragraph 88 of the Framework, the criteria for
recognition of an asset are as follows: 88. An asset is recognised
in the balance sheet when it is probable that the future economic
benefits associated with it will flow to the enterprise and the
asset has a cost or value that can be measured reliably. Therefore
CERs come into existence when these are credited by UNFCCC in a
manner to be unconditionally available to the generating entity.
CERs should not be recognised before that stage.
[email protected] 63
64. Contd What type of Asset is a CER? Keeping in view the
non-physical form of CERs, the definition of intangible asset, as
per Accounting Standard (AS) 26, Intangible Assets, is noted as
follows: An intangible asset is an identifiable nonmonetary asset,
without physical substance, held for use in the production or
supply of goods or services, for rental to others, or for
administrative purposes. [email protected]
64
65. Contd Therefore, though CERs are non-monetary assets
without a physical form, they do not strictly fall within the
meaning of intangible asset as per AS 26. CERs are inventories of
the generating entity as they are generated and held for the
purpose of sale in the ordinary course of business. Therefore, even
though CERs are intangible assets these should be accounted for as
per the requirements of AS 2 Valuation of Inventories
[email protected] 65
66. Contd Measurement of CERs? CERs are inventories for an
entity which generates the CERs. Therefore, the valuation
principles as prescribed in AS 2 should be followed for CERs. As
per AS 2, inventories should be valued at the lower of cost and net
realisable value. Accordingly, CERs should be measured at cost or
net realisable value, whichever is lower.
[email protected] 66
67. Contd Measurement of Underlying Assets related to CERs? For
the generation of CERs, the generating entity may create certain
intangible and tangible assets. For example, for reducing
emissions, an entity may carry out some research and development
which may result into creation of an intangible asset. Insofar as
expenditure on research and development is concerned, the entity
should apply AS 26, Intangible Assets.
[email protected] 67
68. Contd In some cases, an entity may use a tangible asset to
reduce emissions. For example, an entity may use incinerators for
the purpose of reducing carbon emissions. In respect of such
equipments/devices, the provisions of the Accounting Standard (AS)
10, (Revised) Tangible Fixed Assets (which is being formulated)will
apply Any pollution control/emission reduction devices installed by
the generating entity for the purpose of generating CERs are fixed
assets and [email protected] therefore they
shall be accounted for as per AS 68
69. Contd An entity should present CERs as part of Inventories,
in the balance sheet, separately from other categories of
Inventories such as Raw Materials, Work-in-process, Finished goods
and others. An entity should disclose the following information
relating to CERs in the financial statements: a) No. of CERs held
as inventory and the basis of valuation. b) No. of CERs under
certification. c) Depreciation and operating and maintenance costs
of Emission Reduction equipment expensed during the year.
[email protected] 69
70. Climate Exchanges Climate exchanges have been established
to provide a spot market in allowances, as well as futures and
options market to help discover a market price and maintain
liquidity. The spot market or cash market is a commodities or
securities market in which goods are sold for cash and delivered
immediately. The spot market for most securities exists primarily
on the Internet. A futures exchange is a central financial exchange
where people can trade standardized futures contracts; that is, a
contract to buy specific quantities of a commodity or financial
instrument at a specified price with delivery set at a specified
time in the future. [email protected] 70
71. Contd... Currently, futures contracts in carbon credits are
actively traded in the European exchanges Carbon prices are
normally quoted in Euros per tonne of carbon dioxide or its
equivalent (CO2e) For trading purposes, one allowance or CER
(certified emission reduction) is considered equivalent to one
metric tonne of CO2 emissions. These allowances can be sold
privately or in the international market at the prevailing market
price. Each international transfer is validated by the UNFCCC. Each
transfer of ownership within the European Union is additionally
validated by the European Commission.
[email protected] 71
72. Exchanges trading in carbon allowances Chicago Climate
Exchange European Climate Exchange Nord Pool Powernext Multi
Commodity Exchange National Commodity and Derivatives Exchange
Indian Energy Exchange [email protected] 72
73. Multi Commodity Exchange of India Ltd. (MCX) MCX is a
demutualised nationwide electronic multi commodity futures exchange
set up by Financial Technologies with permanent recognition from
Government of India for facilitating online trading, clearing &
settlement operations for futures market across the country.
Headquartered at Mumbai The exchange started operations in November
2003. [email protected] 73
74. Indian Energy Exchange Limited (IEX) IEX is Indias first
nationwide, automated, and online electricity trading platform. It
has been conceived to catalyse the modernisation of electricity
trade in the country by ushering in a transparent and neutral
market through a technologyenabled electronic trading platform. IEX
is a demutualised exchange (for profit shareholder owned
corporation) IEX commenced operations on 27th June 2008 Regulator
of IEX: Central Electricity Regulatory Commission (CERC)
[email protected] 74
75. Energy and Environment Interphase Energy and environment
are essential for sustainable development. The poor are
disproportionately affected by environmental degradation and lack
of access to clean, affordable energy services. Section 2(h) of the
Energy Conservation Act 2001, defines Energy as Energy means any
form of energy derived from fossil fuels, nuclear substances or
materials, Hydro-electricity and includes electrical energy or
electricity generated from renewable sources of energy or biomass
connected to the grid. [email protected] 75
76. Contd About 20% of worlds energy is generated from coal and
about 60% of worlds energy is generated from oil and natural gas.
Because of extensive use of fossil fuel, such as coal, oil and
natural gas, as primary source of energy today, the harmful
emissions of GHG (Green House Gasses) such as Carbon Dioxide
increases the GHG level and causes the Greenhouse Effect and
eventually global warming. Scientists believes that global warming
will cause the average World temperature rise by one Degree Celsius
by the year 2020 and four Degree Celsius by the end of 21st
century. [email protected] 76
77. Energy Conservation Energy conservation is the practice of
decreasing the quantity of energy used. It can be achieved through
efficient energy use, where energy use is decreased while achieving
a similar outcome, or by reduced consumption of energy services.
Energy conservation facilitates the replacement of nonrenewable
resources with renewable energy. It is often the most economical
solution to energy shortages, and is a more environmentally benign
alternative to increased energy production. Investment in energy
efficiency/energy conservation is highly cost effective. It also
avoids investment in fuel, mining, transportation etc.
[email protected] 77
78. Contd Energy requirement in India is increasing rapidly.
Its demand for commercial energy in 2020 is expected to increase by
250% from todays level. Economic growth is desirable for developing
countries, and energy is essential for economic growth. If India is
to achieve the targeted growth in GDP, it would need commensurate
input of energy, mainly commercial energy in the form of coal, oil,
gas and electricity. [email protected] 78
79. Energy Conservation in India Energy Conservation Act 2001
Enacted by the Government of India considering the vast potential
of energy savings and benefits of energy efficiency. It was enacted
in October 2001 but became effective from 1st March, 2002. The Act
provides for the legal framework, institutional arrangement and a
regulatory mechanism at the Central and State level to embark upon
energy efficiency drive in the country. The Act is divided into 10
chapters, comprising of 62 sections and one Schedule.
[email protected] 79
80. Contd Framework of the Act: Chapter I: Preliminary Chapter
II:Bureau of Energy Efficiency Chapter III: Transfer of assets,
liabilities etc. of Energy Management Centre to Bureau Chapter IV:
Powers and functions of Bureau Chapter V: Power of Central
Government to facilitate and enforce efficient use of energy and
its conservation [email protected] 80
81. Contd Chapter VI: Power of State Government to facilitate
and enforce efficient use of energy and its conservation Chapter
VII: Finance, Accounts and Audit of Bureau Chapter VIII: Penalties
and Adjudication Chapter IX: Appellate Tribunal for Energy
Conservation Chapter X : Miscellaneous The Schedule : List of
Energy Intensive Industries and other establishments specified as
designated consumers. [email protected] 81
82. Measures proposed by the Act 1.Energy Conservation 2.
Energy audit of government buildings 3. Capacity building amongst
departments to take up energy efficiency programmes The Thrust
Areas : a. Industry specific Task Forces. b. Notifying more
industries as designated consumers. c. Conduct of energy audit
amongst notified designated consumers. d. Recording and publication
of best practises e. Development of energy consumption norms.
rajkumarfcaf. Monitoring of compliance with mandated provision by
[email protected] 82
83. Important Provisions Under the Act Energy intensive
Industries The Schedule to the Energy Conservation Act, 2001 gives
the List of Energy Intensive Industries and other establishments
specified as designated consumers. Establishment of Bureau of
Energy Efficiency The Bureau of Energy Efficiency (BEE) is a
statutory Body under the Ministry of Power, Government of India
established with effect from 1st March, 2002. The Energy
Conservation Building Codes (ECBC) The BEE launched the Energy
Conservation Building Code (ECBC) on 27th May 2007 in New Delhi.
This code addresses the design of rajkumarfcanew, large commercial
buildings to optimize the buildings energy demand.
[email protected] 83
84. Contd Designated Consumers (DCs) The Central Government
may, by notification, in consultation with the Bureau, specify, any
user or class of users of energy as a designated consumer for the
purposes of this Act. The Schedule to the Act provides a list of
the Designated Consumers. These DCs have to : 1. Appoint/Designate
Energy Managers 2. Get Energy Audit conducted by Accredited Energy
Auditors 3. Implement Techno-Economic Viable Recommendations 4.
Comply with norms of specific energy consumption fixed
[email protected] 84 5. Submit Report on Steps
Taken
85. Contd Labeling Programme for Appliances An energy labeling
programme for appliances was launched in 2006, and comparative
starbased labeling has been introduced for fluorescent tubelights,
air conditioners, and distribution transformers. Energy Audits of
Large Industrial Consumers In March 2007, the conduct of energy
audits was made mandatory in large energy-consuming units in nine
industrial sectors. it is mandatory for the designated consumers to
get energy audit conducted by an accredited energy auditor These
units are also required to employ certified energy managers, and
rajkumarfcareport energy consumption and energy conservation
[email protected] data annually. 85
86. Environmental Laws Complex and interlocking body of
statutes, common law, treaties, conventions, regulations and
policies to regulate the impacts of human activity on the natural
environment The Indian constitution is amongst the few in the world
that contains specific provisions on environment protection. The
Constitution states that it is the duty of the state to protect and
improve the environment and to safeguard the forests and wildlife
of the country. Organisations have a legal and moral duty to comply
with environmental laws and regulations.
[email protected] 86
87. Sources of Environmental Law Treaties Bilateral
Multilateral Protocols Conventions Customary International Law
Judicial decisions etc. [email protected]
87
88. United Nations Conference on the Human Environment (UNCHE)
An international conference convened under United Nations auspices
held in Stockholm, Sweden from June 5-16, 1972. It was the UN's
first major conference on international environmental issues, and
marked a turning point in the development of international
environmental politics. The conference acknowledged that the goal
of reducing human impact on the environment would require extensive
international cooperation, as many of the problems affecting
[email protected] 88 the environment are global
in nature.
89. Contd The meeting agreed upon a Declaration containing 26
principles concerning the environment and development; an Action
Plan with 109 recommendations, and a Resolution. Following this
conference, the United Nations Environmental Programme (UNEP) was
launched in order to encourage United Nations agencies to integrate
environmental measures into their programs.
[email protected] 89
90. Important Environmental Laws in India The Environment
(Protection) Act, 1986 Water (Prevention and Control) Act, 1974 Air
(Prevention and Control) Act, 1981 The Public Liability Insurance
Act, 1991 The Biological Diversity Act, 2002 The Indian Forest Act,
1927 Forest (Conservation) Act, 1980 The Indian Wildlife Protection
Act, 1972 The National Green Tribunal Act, 2010
[email protected] 90
91. Environment Impact Assessment (EIA) The study to predict
the effect of a proposed activity/project on the environment. Its a
decision making tool - EIA compares various alternatives for a
project and seeks to identify the one which represents the best
combination of economic and environmental costs and benefits. EIA
systematically examines both beneficial and adverse consequences of
the project and ensures that these effects are taken into account
during project design. [email protected] 91
92. Contd It helps to identify possible environmental effects
of the proposed project, proposes measures to mitigate adverse
effects and predicts whether there will be significant adverse
environmental effects, even after the mitigation is implemented.
Benefits of EIA - protection of environment, optimum utilisation of
resources and saving of time and cost of the project.
[email protected] 92
93. Stages of EIA Process Screening Setting Scope Impact
Analysis Mitigation Reporting Review of EIA Decision Making
Post-Monitoring [email protected] 93
94. Green Audit Green audit is an official examination of the
effects a company has on the environment. It can also be described
as the inspection of a company to assess the total environmental
impact of its activities or of a particular product or process. It
is also widely known as Environmental Audit. Its Aim is to review
the measures taken by the company to combat pollution.
[email protected] 94
95. Compliance of Laws under Green Audit National Environment
Laws, Rules and Regulations; Notifications issued by the Government
and the agencies under them; Standards issued by responsible bodies
such as those for Environment Impact Assessments (EIA), ISO 14001
for Environment Management System, pollution control orders and
standards issued by oversight and implementation bodies such as
CPCB etc.; Sanctions and permits issued in respect of the entity by
the regulatory bodies concerned; EIA reports, reviews by
independent organisations, companys environment policy etc.
[email protected] 95
96. Green Audit Report The Green Audit Report should be
complete, precise, accurate and balanced. Contents should be easy
to understand and free from vagueness or ambiguity It should
include information which is supported by complete and relevant
audit evidence and be independent, objective fair and constructive.
It should contain constructive and precise recommendations. It must
be persuasive and instrumental in inspiring the managements of
entities to take corrective actions. The violations and omissions
should also be effectively rajkumarfcamentioned in the report.
[email protected] 96
97. Ministry of Environment & Forests (MOEF) Nodal agency
in the administrative structure of the Central Government for the
planning, promotion, co-ordination and overseeing the
implementation of India's environmental and forestry policies and
programmes Also serves as the nodal agency for the United Nations
Environment Programme (UNEP), South Asia Co-operative Environment
Programme (SACEP), International Centre for Integrated Mountain
Development (ICIMOD) and for the follow-up of the United Nations
[email protected] Conference on Environment and
Development 97
98. Contd The Ministry is also entrusted with issues relating
to multilateral bodies such as the Commission on Sustainable
Development (CSD), Global Environment Facility (GEF) and of
regional bodies like Economic and Social Council for Asia and
Pacific (ESCAP) and South Asian Association for Regional
Co-operation (SAARC) on matters pertaining to the environment.
[email protected] 98
99. Central Pollution Control Board (CPCB) Constituted in
September, 1974 Is a body corporate having perpetual succession and
a common seal with power to acquire, hold and dispose of property
and to contract and may by the aforesaid name sue or be sued.
Principal Functions of the CPCB (i) to promote cleanliness of
streams and wells in different areas of the States by prevention,
control and abatement of water pollution, and (ii) to improve the
quality of air and to prevent, control or abate air pollution in
the country. [email protected] 99
100. State Pollution Control Board (SPCB) Constituted by the
State Government by notification in the official gazette. With
regard to a Union Territory, a SPCB is not constituted. The CPCB
exercises the powers and performs the functions of a SPCB for that
Union Territory, however it may delegate its powers. SPCB will be a
body corporate having perpetual succession and a common seal with
power to acquire, hold and dispose of property and to contract and
may by the aforesaid name sue or be sued
[email protected] 100
101. National Green Tribunal Established on 18.10.2010 under
the National Green Tribunal Act 2010 Objective - Effective and
expeditious disposal of cases relating to environmental protection
and conservation of forests and other natural resources including
enforcement of any legal right relating to environment and giving
relief and compensation for damages to persons and property and for
matters connected therewith or incidental thereto. It is a
specialized body equipped with the necessary expertise to handle
environmental disputes involving multi-disciplinary issues.
[email protected] 101
102. Contd.. The Tribunal will not be bound by the procedure
laid down under the Code of Civil Procedure, 1908, but shall be
guided by principles of natural justice. The Tribunal is mandated
to make and endeavour for disposal of applications or appeals
finally within 6 months of filing of the same. Initially, the NGT
is proposed to be set up at five places of sittings and will follow
circuit procedure for making itself more accessible. New Delhi is
the Principal Place of Sitting of the Tribunal and Bhopal, Pune,
Kolkata and Chennai shall be the other 4 place of sitting of the
Tribunal. [email protected] 102
103. Important Web Sites http://www.ipcc.ch/
http://cdm.unfccc.int/index.html http://www.worldbank.org
http://envfor.nic.in/cc/index.htm http://www.cdmindia.nic.in/
http://www.mcxindia.com http://www.iexindia.com
http://www.teriin.org/ http://www.cpcb.nic.in
rajkumarfcahttp://www.greentribunal.in/ [email protected]
103