Author: WM

European Parliament Approves New Rules for Monitoring GHG emissions, including Forestry and Agriculture

 
On March 12, 2013, the European Parliament approved two new laws to improve EU rules on monitoring and reporting of greenhouse gas (GHG) emissions, including those from forestry and agriculture.  It is expected that the Council will adopt these laws, after which they will be published in the Official Journal and enter into force.

Connie Hedegaard, European Commissioner for Climate Action, said: “These new rules will help Europe develop robust evidence-based climate policies and keep better track of progress towards meeting our emission targets. They improve transparency, coordination and the quality of data reported, and forest and agriculture emissions will now be accounted for in a harmonised way. We hope that these new rules will also set an example in the context of the international climate negotiations and serve as a benchmark for transparency of climate action by other countries.”

Monitoring Mechanism

The Monitoring Mechanism Regulation enhances the current reporting rules on Member States’ GHG emissions in order to meet requirements arising from current and future international climate agreements, as well as the 2009 climate and energy package. In particular, the revised Monitoring Mechanism aims to help the EU and Member States keep track of progress towards meeting their emission targets for the period 2013-2020 and to facilitate further development of the EU climate policy mix. The EU and Member States already cooperate to monitor and report GHG emissions, producing annual GHG inventories which are used to assess progress towards meeting Kyoto Protocol emission targets. In addition, information is compiled on GHG projections and on policies and measures to reduce emissions.

The revised rules aim to improve the quality of data reported and introduce some new elements, such as:

  • reporting of emissions and removals from land use, land use change and forestry (LULUCF);
  • reporting of Member States’ adaptation to climate change;
  • reporting of Member States’ and the EU’s low-carbon development strategies;
  • reporting on financial and technical support provided to developing countries, and commitments arising from the 2009 Copenhagen Accord and 2010 Cancún Agreements;
  • reporting on Member States’ use of revenues from the auctioning of allowances in the EU emissions trading system (EU ETS). Member States have committed to spend at least half of the revenue from such auctions on measures to fight climate change in the EU and third countries.

LULUCF

The second law approved by the European Parliament establishes common rules for accounting for GHG emissions and removals of carbon from the atmosphere resulting from activities related to land use, land use change and forestry (LULUCF).  This represents a first step towards incorporating the forestry and agriculture sectors – the last major sectors without common EU-wide rules on GHG emissions – into EU climate policy. Forests and agricultural lands cover more than three-quarters of the EU territory and naturally hold large stocks of carbon, preventing its escape into the atmosphere. If their capacity to “trap” carbon were improved by just 10 percentage points (for example through improved forest or grassland management), this would remove the equivalent of annual emissions of 10 million cars from the atmosphere.

This decision requires Member States to report on their actions to increase removals of carbon and decrease emissions of greenhouse gases from forests and soils. While the law does not currently include national emission reduction targets for these sectors, such targets may be introduced at a later stage once the accounting rules have proven robust.

More information is available from the European Commission
 

RGGI Proposes Tightening its Regional CO2 Emissions Cap by 45%

 
Following a comprehensive two-year program review, the nine Northeastern and Mid-Atlantic states participating in the Regional Greenhouse Gas Initiative (RGGI), the United States’ first market-based regulatory program to reduce greenhouse gas emissions, released an updated RGGI Model Rule and Program Review Recommendations Summary in February 2013.

The changes outlined in the Updated Model Rule and Program Review Recommendations Summary are aimed at strengthening the program by making the following improvements:

  • A reduction of the 2014 regional CO2 budget (the RGGI cap) from 165 million to 91 million tons – a reduction of 45%. The cap would decline 2.5% each year from 2015 to 2020.
  • Additional adjustments to the RGGI cap from 2014-2020, which will account for the private bank of allowances held by market participants before the new cap is implemented in 2014. From 2014-2020 compliance with the applicable cap will be achieved by use of “new” auctioned allowances and “old” allowances from the private bank.
  • Cost containment reserve (CCR) of allowances that creates a fixed additional supply of allowances that are only available for sale if CO2 allowance prices exceed certain price levels ($4 in 2014, $6 in 2015, $8 in 2016, and $10 in 2017, rising by 2.5 percent, to account for inflation, each year thereafter.)
  • Updates to the RGGI offsets program, including a new forestry protocol.
  • Requiring regulated entities to acquire and hold allowances equal to at least 50% of their emissions in each of the first 2 years of the 3 year compliance period, in addition to demonstrating full compliance at the end of each 3 year compliance period.
  • Commitment to identifying and evaluating potential tracking tools for emissions associated with electricity imported into the RGGI region, leading to a workable, practicable, and legal mechanism to address such emissions.

The original RGGI cap was set at 2009 emission levels, with the expectation that emissions would grow. However, emissions have dropped dramatically because of the use of natural gas and other efficiencies in the RGGI states, reducing the demand for the permits. This resulted in depressing the RGGI permit price for carbon credits to under US $2, which is far below the projected US $20-$30. It is anticipated that the lower cap will stimulate interest and raise RGGI permit prices in the next auction. Analyses indicate that the proposed program changes will result in a modest increase in allowance prices, with allowances expected to be priced at approximately US $4 ($2010) per allowance in 2014 and rising to approximately US $10 ($2010) per allowance in 2020. In addition, analysts expect that the proposed program changes will reduce projected 2020 power sector CO2 pollution more than 45% below 2005 levels.

With the release of the Updated Model Rule, the RGGI states now plan to revise their CO2 Budget Trading Programs through their individual state-specific statutory and regulatory processes. Each RGGI state seeks to complete their state specific processes such that the proposed changes to the program would take effect on January 1, 2014. A summary of the program review is available online.
 

U.S. Consumers are taking into account companies’ actions on climate change when purchasing

 
According to a recent report from the Yale Project on Climate Change Communication and the George Mason University Center for Climate Change Communication, since 2008, approximately 25% percent of U.S. consumers have either rewarded or punished companies for those companies’ actions related to climate change. The report, “Americans’ Actions to Limit Global Warming in September 2012” (available online), indicates that a significant portion of the consumer market continues to care about the position of companies on climate change. The report also concludes that individuals who have not used purchasing power to either reward or punish companies in the past year plan to increase personal acts of consumer activism in the next year.

The report indicates that in the 12 months leading up to the September 2012 survey, about one in three adults rewarded a company that took steps to reduce emissions.  In addition to rewarding companies for taking actions to reduce climate change impacts, 24% of those surveyed in September 2012 indicated that they had at some point in the past year chosen not to purchase products by companies that oppose steps to reduce climate change.

When asked to contemplate future behavior, 52% of individuals surveyed expressed the intent to either reward or punish companies sometime in the next year for the companies’ action or inaction to reduce climate change. Since researchers from Yale and George Mason began collecting data four years ago, slightly more than half of Americans have consistently reported plans to use purchasing power to either reward or punish companies. In November 2008, consumers indicated the greatest willingness (58%) to either buy or not buy based on a company’s actions on climate change. In the economic recession of 2010, willingness to utilize purchasing power to support global warming action fell to 51%. Since then, consumer support for utilizing purchasing power has remained at just over half of the surveyed American adults.

The Yale and George Mason researchers also studied three other prongs of climate actions by citizens: (1) saving energy, (2) citizen behavior, and (3) communication behavior. Even though a majority of American adults report that they always or often set their thermostats below 68 degrees and take other actions like replacing traditional light bulbs with compact fluorescent light bulbs, the researchers noted a decline in Americans’ belief that certain energy-saving actions can reduce climate change. Americans are less confident today than four years ago that their individual actions will reduce their contribution to climate change. While Americans may be less optimistic about their individual impact on global warming, the report’s authors observed that a growing number of Americans say they contacted a government official in the past year to support mitigation of climate change. In the next year, the report indicates that more Americans intend to urge government officials to take action on climate change.

Overall, the Yale and George Mason polling data indicate that Americans continue to be concerned about global warming and are willing to use political and consumer activism to push for action on global warming.



 



	


	





	

		
		
Ontario Ministry of Environment seeks input on Greenhouse Gas Discussion Paper
	


	
	
	

		
 

On January 21, 2013, the Ontario Ministry of the Environment (MOE) released a discussion paper entitled Greenhouse Gas Emissions Reductions in Ontario. The purpose of the paper (available online): is to support discussions and gather feedback on the development of a greenhouse gas (GHG) emissions reduction program. In addition, these discussions will elicit information to support Ontario’s intention to obtain equivalency with the developing federal greenhouse gas regulations in certain sectors (including natural gas‐fired electricity generation), meaning that Ontario industries will not be subject to duplicate requirements.


In 2007, Ontario introduced its Climate Change Action Plan which includes the following GHG emissions reduction targets:


    

  • 6% below 1990 levels by 2014,
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  • 15% below 1990 levels by 2020, and
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  • 80% below 1990 levels by 2050.
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Ontario estimates that current initiatives to reduce greenhouse gas emissions will deliver 60% of the reductions needed to reach the 2020 reduction target. While a GHG emissions reduction program alone will not close the gap, it will play an important role in moving Ontario towards its goal of being 15% below 1990 emissions levels by 2020.


The program elements presented for discussion in the paper have been developed based on a set of key principles aimed at balancing Ontario’s economic and environmental interests. These principles include:


    

  • Achieving absolute reductions in greenhouse gas emissions in a cost‐effective way that considers competitiveness and supports achieving equivalency with the federal government.
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  • Simplicity, consistency, transparency and administrative efficiency.
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  • Striving to treat sectors and facilities equitably.
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  • Taking into account early action by industry leaders.
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  • Using accurate and verified emissions data to support policy development.
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  • Promoting development and deployment of clean technologies.
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  • Considering broad alignment with other emissions reduction programs of similar rigour that provides opportunity for linking in the future.
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  • Considering integration with other provincial environmental policies.
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The paper indicates that Ontario’s program would initially limit GHG emissions from fossil fuel-fired electricity generators and large GHG emitters in certain industries, including petroleum refining, chemicals, steel, cement and pulp and paper. The paper also indicates that the program would limit emissions from facilities in these sectors (other than the electricity generation sector) to the level of their current total emissions, with the limit declining thereafter by 5% over five years. Although it does not explicitly advocate a cap-and-trade system, the paper does suggest that the MOE will consider the use of emissions trading mechanisms to establish a carbon price and provide businesses with options on how to achieve reductions at the lowest cost.


In addition, the paper proposes that Ontario’s program would be in place one year prior to federal regulation of greenhouse gases from industry. A one year window will provide time for the province to negotiate and finalize an equivalency agreement with the federal government to ensure there is a single regulator for greenhouse gas emissions in the province.


Ontario acknowledges that other North American jurisdictions are also taking action to address emissions of GHGs. It notes that Quebec, British Columbia, Alberta, Saskatchewan and Nova Scotia all have or are developing regulations to reduce greenhouse gases. It also notes that in the USA, the Regional Greenhouse Gas Initiative limits emissions from electricity generation in north-eastern states, while California has introduced a broad greenhouse gas emissions trading regime with an intention of linking to Quebec’s program.


The MOE will accept submissions on the discussion paper until April 21, 2013. For further information, please refer to the Environmental Registry: Here

 



	


	





	

		
		
What are Greenhouse Gases?
	


	
	
	

		
 

Gases that trap heat in the atmosphere are called greenhouse gases or GHGs.  When sunlight reaches the Earth’s surface, it can either be reflected back into space or absorbed by Earth. Once absorbed, the planet releases some of the energy back into the atmosphere as heat (also called infrared radiation). GHGs like water vapor (H2O), carbon dioxide (CO2) and methane (CH4) absorb energy, which slow or prevent the loss of heat in to space.  This process is commonly referred to as the “greenhouse effect”, whereby GHGs act like a blanket, making the Earth warmer than it would otherwise be.


Since the Industrial Revolution began around 1750, human activities have contributed substantially to climate change by adding CO2 and other heat-trapping gases to the atmosphere. These GHG emissions have increased the greenhouse effect, leading to rises in the Earth’s surface temperatures. According to the National Research Council (Advancing the Science of Climate Change, 2010), atmospheric CO2 concentrations have increased by almost 40% since pre-industrial times, from approximately 280 parts per million by volume (ppmv) in the 18th century to 390 ppmv in 2010.  The current CO2 level is higher than it has been in at least 800,000 years.  The primary human activity affecting the amount and rate of climate change is greenhouse gas emissions from the burning of fossil fuels for electricity, heat, and transportation.


The main GHGs directly emitted by humans include CO2, CH4, nitrous oxide (N2O), and several others:


    

  • Carbon dioxide (CO2):  CO2 is absorbed and emitted naturally as part of the carbon cycle through animal and plant respiration, volcanic eruptions, and ocean-atmosphere exchange. Human activities, such as the burning of fossil fuels and changes in land use, release large amounts of carbon to the atmosphere, causing CO2 concentrations in the atmosphere to rise.
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  • Methane (CH4):  Methane is emitted during the production and transport of coal, natural gas, and oil. Methane emissions also result from livestock and other agricultural practices and by the decay of organic waste in municipal solid waste landfills.
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  • Nitrous oxide (N2O): Nitrous oxide is emitted during agricultural and industrial activities, as well as during combustion of fossil fuels and solid waste.
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  • Fluorinated gases or F-gases: Chlorofluorocarbons (CFCs), hydrochlorofluorocarbons (HCFCs), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulfur hexafluoride (SF6) are synthetic, powerful GHGs that are emitted from a variety of industrial processes. F-gases are often used in coolants, foaming agents, fire extinguishers, solvents, pesticides, and aerosol propellants. F-gases are also sometimes used as substitutes for stratospheric ozone-depleting substances. These gases are typically emitted in smaller quantities, but because of their potency, they are sometimes referred to as “High Global Warming Potential” gases. F-gases have a long atmospheric lifetime and some of these emissions will affect the climate for many decades or centuries.
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  • Tropospheric ozone (O3): Tropospheric ozone has a short atmospheric lifetime, but it is a potent GHG. Chemical reactions create ozone from emissions of nitrogen oxides and volatile organic compounds from automobiles, power plants, and other industrial and commercial sources in the presence of sunlight. In addition to trapping heat, ozone is a pollutant that can cause respiratory health problems and damage crops and ecosystems.
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  • Water vapor: This is the most abundant GHG and significant in terms of its contribution to the natural greenhouse effect, despite having a short atmospheric lifetime. While some human activities can influence local water vapor levels, the concentration of water vapor on a global scale is controlled by temperature which influences overall rates of evaporation and precipitation. As a result, the global concentration of water vapor is not substantially affected by direct human emissions.
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The effect of GHGs on climate change depends on three main factors: (i) the concentration of GHGs in the atmosphere; (ii) the length of time that GHGs stay in the atmosphere; and (iii) the impact of GHGs on global temperatures.


The concentration of GHGs in the atmosphere is measured in parts per million, parts per billion, and sometimes parts per trillion. One part per million is equivalent to one drop of water diluted into about 13 gallons of liquid.


With respect to the length of time that GHGs stay in the atmosphere, each GHG can remain in the atmosphere for different amounts of time, ranging from a few years to thousands of years. All of these gases remain in the atmosphere long enough to become well mixed, meaning that the amount that is measured in the atmosphere is roughly the same all over the world, regardless of the source of the emissions.


In terms of the impact of GHGs on global temperatures, the two most important characteristics are how well the gas absorbs energy (preventing it from immediately escaping to space) and how long the gas stays in the atmosphere. Some GHGs have a stronger impact than others on global temperatures. For each GHG, a Global Warming Potential (GWP) has been calculated to reflect how long it remains in the atmosphere, on average, and how strongly it absorbs energy. The GWP for a gas is a measure of the total energy that a gas absorbs over a particular period of time (usually 100 years), compared to CO2.  Gases with a higher GWP absorb more energy, per pound, than gases with a lower GWP, and thus contribute more to changes in global temperatures. For example, methane’s 100-year GWP is 21, which means that methane will cause 21 times as much warming as an equivalent mass of carbon dioxide over a 100-year time period.


Accurate reporting and monitoring of GHG emissions is fundamental to reducing greenhouse gases and taking meaningful action to combat climate change. After all, you cannot manage what you do not measure.




 



	


	





	

		
		
RinkWatch Initiative brings the Climate Change issue right into Canadian backyards
	


	
	
	

		
 

Researchers at Wilfred Laurier University in Waterloo, Ontario have launched an initiative involves to help track climate change by recruiting volunteers to report on their outdoor rinks. RinkWatch (rinkwatch.org) is an innovative citizen science-driven project that has already signed up hundreds of volunteers since the web site was launched in early January 2013.


In 2012, scientists in Montreal warned that there will be fewer outdoor skating days in the future. Their predictions are based on the results of data taken from weather stations across Canada over the last fifty years. In some regions, scientists warn that one day, there may be no more backyard rinks at all. This is particularly poignant for those who remember the story of how Wayne Gretzky learned to play hockey on the backyard rink his father made for him in Brantford, Ontario.


This warning prompted a group of geographers at Wilfrid Laurier University to create RinkWatch, where outdoor rink enthusiasts across North America and around the world can tell the geographers about their rinks.  The web site asks volunteers to pin the location of their rinks on a map, and then each winter record every day that they are able to skate on it.  The geographers will then gather all the information and use it to track the changes in our climate. The RinkWatch web site will provide regular updates on the results. Participants will also be able to compare the number of skating days at their rink with rinks elsewhere.


Robert McLeman, an associate professor of geography and environmental studies at Wilfred Laurier explained the rationale behind the project: “Everyone understands what’s going on in their backyard. The winters are different now than they were 20, 40, 60 years ago, and these [rinks] are things that they make a connection with personally.” McLeman says the project was modeled on the efforts of birdwatchers, who have been conducting backyard bird counts for many decades.


While volunteers may not think of it as science, that is exactly what they will be doing – making regular, systematic observations about environmental change in their own backyards. These efforts will not only help science achieve a broader understanding of the effects of climate change, but it will engage the public in climate changes issues at a very grassroots level.




 



	


	





	

		
		
Canada Missing out on Growing Global Environmental Market
	


	
	
	

		
 

Despite the slow recovery of the global economy and a lack of political will for addressing environmental and climate change issues, a report by the Environmental Business Journal estimates that the annual value of the global environmental market was $866 billion in 2011, up 4% from the year before. While the US, Western Europe and Japan remain the three largest and most mature environmental markets, growth in the global environmental market in 2011 was led by Africa (up 10%), followed by the Middle East and the rest of Asia (both up 9%). In terms of business sectors, the largest is solid waste management, followed by water utilities and treatment. Recycling, green building, energy efficiency and other areas under the resource recovery and clean energy categories are all growing at faster rates than the overall economy in most nations.


In Canada, there is a large untapped potential for environmental markets.  A report released by Sustainable Prosperity in November 2012 estimates that Canada’s combined environmental marketplace is worth between $462 million and $752 million annually.  The wide gap between the high and low estimates is due to a lack of transparency and the definition of “environmental market”. In the report, an environmental market is defined as a market having a buyer, a seller and the exchange of an environmental attribute.  57 markets were covered in the report and it is anticipated that the value of the Canadian environmental marketplace will increase as new programs such as Quebec’s greenhouse gas cap-and-trade system develop. Sustainable Prosperity’s analysis indicates that markets addressing biodiversity and habitat conservation, water quality, water quantity, climate change, and air quality can provide environmental benefits inexpensively if they are well-designed markets. For investors, they also represent an opportunity for exposure to a new and growing asset class.  These markets may represent a significant financial sum as a whole, but most of the individual ones are small and underdeveloped in terms of their infrastructure and scope. Greater certainty in terms of environmental policy and regulatory flexibility to allow for the increased use of markets would help attract the necessary capital from the private sector to expand and grow Canada’s environmental marketplace.




 



	


	





	

		
		
UN Climate Talks Conclude with an Agreement on the “Doha Climate Gateway”
	


	
	
	

		
 

The United Nations’ annual global climate negotiations – or Conference of the Parties (COP) 18 – took place in the City of Doha, Qatar from November 26 to December 8, 2012.  As the country with the highest per capita emissions in the world at 50 tonnes per person, Qatar was an interesting choice of venue.  Negotiations ran a day over schedule, but concluded with an agreement on the “Doha Climate Gateway”.  According to the United Nations Framework Convention on Climate Change, the agreement marks the beginning of discussions on a legally binding international agreement to cap emissions at scientifically acceptable levels (restricting warming to a two degree Celsius increase in global average temperature).


At COP 17 in Durban, South Africa, the parties agreed to create a treaty by 2015 which would come into force by 2020. The objectives at COP 18 were to move the collective agreement forward at an appropriate rate to meet the 2015 deadline.  Following the talks, the parties agreed to the following:


1.       The Kyoto Protocol was officially extended for a second commitment period from January 1, 2013 to 2020. A number of previous signatories, including Canada, have withdrawn from the Kyoto Protocol, which now covers only 15% of the world’s emissions. Its primary participants are the European Union, Norway and Australia.


2.       The final text of the agreement “encourages” developed nations to pay $10 billion a year to 2020 to help developing nations access clean energy and implement climate change adaptation measures. The agreement is not legally binding and does not ascribe blame to developed nations for “loss or damages” experienced as a result of events related to climate change.


Developing countries and observers expressed disappointment with the lack of ambition in outcomes in terms of mitigation and finance by developed countries, but most agreed that the conference had paved the way for a new phase of focusing on the implementation of the outcomes from negotiations under the ad hoc working groups.


An important achievement outside of COP was that 25 members of the Climate and Clean Air Coalition agreed to significantly reduce emissions of short-lived pollutants, including soot, methane and ozone, and excluding carbon dioxide. It is estimated that this agreement could reduce the expected temperature increase by 0.5 degrees Celsius by 2050, a fraction of the four to six degrees forecast by the end of the century if we stay on the current emissions path.


COP 19 will be hosted by Poland in 2013.




 



	


	







	

		
		
More than 100 of the World’s Leading Companies Call for a Clear Price on Carbon
	


	
	
	

		
 

Shell, Unilever and more than 100 of the world’s largest companies recently released a statement calling upon lawmakers around the world to put a “clear, transparent and unambiguous price” on carbon emissions in order to address the climate challenge and help manage the business risk associated with climate change. The statement (available online), which is due to be presented to European Commissioner for Climate Action Connie Hedegaard in Brussels, calls for clarity to open channels for investment in infrastructure projects and its authors explain that in many cases, companies do not consider goals to cut greenhouse gas (GHG) emissions. The letter notes a key lesson from existing carbon pricing systems – without a sufficient carbon price signal, companies will have no incentive to invest in low-carbon projects or technology.


A price on carbon emissions must be core to policy objectives in order for the business community to deliver substantial GHG emission reductions and help the world meet the UN goal of containing the global temperature increase to two degrees Celsius. According to the International Energy Agency (IEA), almost 80% of the emissions allowable by 2035 under a two-degree scenario are already locked in because of future GHG emissions from existing power plants, factories and buildings. By 2017, all the allowable emissions will be locked in if no action is taken, the IEA said.


The letter was coordinated by Prince Charles’s Corporate Leaders Group on Climate Change, a group of companies brought together by Prince Charles and managed by the University of Cambridge. Other signatories include Bullfrog Power, Vattenfal, Alstom, Acciona, Skanska and Aviva.


The statement comes at an opportune time as Climate envoys from more than 190 nations are gathering in Doha from November 26 to December 7, 2012 for UN negotiations on climate change.