Greenhouse Gas Accounting GHG Protocol Initiative and ISO

Greenhouse Gas Accounting: GHG Protocol Initiative and ISO World Resources Institute

GHG Protocol/ISO Comparison GHG Protocol History ISO Launched in 1997, Corporate Launched in 2002 standard published in 2000, revised edition in 2004. Project standard being road tested Scope of work Corporate and project Corporate, project & verification Level of detail Standards, guidance & electronic calculation tools Standards and some guidance Adoption Not yet completed – but other ISO standards have high adoption rates by business Corporate standard widely adopted by governments, NGO’s, industry, and industry associations

GHG Protocol/ISO Comparison GHG Protocol ISO Decision making Consensus within multistakeholder groups ? Practical Testing Road testing before completion of Standards None Relevance Policy and program neutral Types of Participants § Multi-stakeholder/ many perspectives/inclusive § Typically experts/practitioners § Typically generalists with history in developing ISO standards § Business-dominated Cost Free – no certification requirements Fees for standards and certification process

Key messages ØAvoid creating competing standards - Don’t reinvent the wheel! - Base organization/project parts on GHG Protocol - Use GHG Protocol terminology to avoid confusion ØForm follows function - Define the purpose of the standards first and design accordingly

Key messages Ø Separate project, corporate & verification standards • Verification standard should be stand-alone • Project standard needs to be on a slower track Ø A good process is crucial • Get the balance of participants/decision makers right e. g. , business, NGO’s, governments, North/South, others • Understanding of issues and concepts is a pre-requisite for informed decision making - this is an iterative process ØKeep communication channels open with GHGP

of the Corporate Standard The Adoption GHG Protocol’s impact on GHG accounting practice California Climate Action Registry French REGES Protocol Carbon Disclosure Project Chicago Climate Exchange Dow Jones Sustainability Index EU- ETS GRI METI, Japan Northeast Registry (NESCAUM) Respect Europe Business Leaders Initiative for Climate Change (BLICC) Industry Associations (Aluminum, IPIECA, ICFPA, Cement, Iron and Steel) GHG Protocol Corporate Standard GHGP Project Standard UK-ETS U. S. EPA Climate Leaders Initiative ISO 14064 is on a good track… World Wildlife Fund Climate Savers World Economic Forum Global GHG Register Setting the scene

Adoption by businesses (those that we know of…) Adoption by businesses Automobile Manufacturers Ford Motor Company, USA Volkswagen, Germany IBM, USA IKEA International, Sweden Johnson & Johnson, USA Miller Brewing Company, USA Nike, USA Cement Norm Thompson Outfitters, USA Cemex, Mexico Pfizer Inc. , USA Cimpor, Brazil Raytheon, USA Heidelberger Cement, Germany SC Johnson, USA Holcim, USA (and worldwide Sony Electronics, Japan Holcim facilities) Starbucks Coffee, USA Italcementi, Italy Staples Inc. , USA Lafarge, France and North Sun Microsystems America Target Corporation, USA RMC, UK Unilever HPC, USA St. Lawrence Cement Inc. , United Technologies Corporation, Canada USA Siam Cement, Thailand Taiheiyo, Japan Votorantim, Brazil Energy Services Birka Energi, Sweden Cinergy, USA Consumer Goods Edison Mission Energy, USA Manufacturers ENDESA, Spain Bank of America Exelon Corporation, USA Body Shop, UK FPL Group, Inc. , USA Cargill, USA General Electric, USA Eastman Kodak, USA Green Mountain Energy, USA Fetzer Vineyards, USA Kansai Electric Power, Japan Mirant, USA N. V. Nuon Renewable Energy, Netherlands PSEG, USA Seattle City Light, USA Tokyo Gas, Japan Wisconsin Electric, USA We Energies, USA Lockheed Martin Corporation, USA Philips & Yaming, China Simplex Paper & Pulp, India STMicroelectronics, Switzerland Stora. Enso, Finland Tata Steel, India United States Steel Corporation Oil and Gas BP, USA Norsk Hydro, Norway Shell Canada, Canada Suncor, USA Non-Government Organizations World Business Council for Sustainable Development, Switzerland World Resources Institute, USA Industrial Manufacturers/ Mining Air Products and Chemicals, Inc. Alcan Aluminum Corporation, USA Alcoa, USA Ball Corporation, USA Baltimore Aircoil, USA Baxter International, USA Bethlehem Steel Corporation, USA CODELCO, Chile Du. Pont, Inc. Interface, Inc. , USA International Paper, USA ITC Inc. , India Services 500 PPM Gmb. H, Germany Astra. Zeneca, UK Casella Waste Systems, Inc. , USA DHL, USA European Bank for Reconstruction & Development PE Europe, Germany Power. Comm, Canada Price Waterhouse Coopers, New Zealand Verizon Communications, USA

Corporate Standard: what’s in it? Standards • Organizational Boundaries • Operational Boundaries Calculation tools Guidance • Web-based, user-friendly, step-by-step guidance • Business goals and • Build on IPCC methodologies inventory design • Sector-specific tools • Historic Datum • Accounting for GHG reductions developed in industry-led • Reporting GHG emissions • Identifying GHG sources efforts (e. g. cement, pulp & paper, aluminum) • Managing inventory quality • Verification of GHG emissions www. ghgprotocol. org

Revised edition of Corporate Standard v To be published early next year, now in final review and design stage v The water is cleaner, and the baby is still in the bath! v Main changes to the first edition v More verification-friendly language (“shall”), which also aims to increase clarity as to what is required to produce a report “in accordance with” GHG Protocol (this does not affect the structure of the document) v Increased flexibility in choosing Organizational Boundaries v More specificity for indirect emissions from purchased electricity (still a required category) v Improved guidance v New case studies reflect how accounting practice has advanced in the meantime v New guidance chapter: Voluntary Corporate GHG targets v New Appendix: Issue piece for companies wishing to account for sequestered carbon

Project standard: what is it? Tool to help project developers to account for GHG reductions made by means of specific reduction projects (offsets/credits)

Project Accounting Principles 1. Relevance 2. Completeness 3. Consistency 4. Transparency 5. Accuracy 6. Conservatism

The Project Quantification Standard Consists of: i. Introduction to GHG accounting ii. Quantification steps iii. Baseline procedures iv. Annexes v. Glossary vi. References vii. List of contributors Project Typology – sector-specific guidance

II: Eight Quantification Steps 1: Describe the project and primary effect(s) 2: Check the eligibility of the primary effect 3: Check the primary effect is additional to legal requirements 4: Undertake a preliminary evaluation of secondary effects 5: Select the baseline scenario 6: Identify and assess the relevance of secondary effects 7: Calculate project reduction and classify based on ownership 8: Develop a monitoring plan (still to come)

III: Baseline Procedures Three Baseline Procedures Project Specific Procedure Performance Standard Procedure Retrofit Procedure

Additionality Uses a three-fold approach 1. 2. Initial ‘Additional to Legal Requirements’ Screen Tests: Barriers, Investment Ranking Project specific Performance Standard Retrofits 3. Additional Stringency level Only remaining life of equipment Project GHG Emission less than Baseline GHG Emissions

GHG Protocol Initiative Thank You www. ghgprotocol. org