Air & Waste Management Association Conducting a Greenhouse Gas (GHG) Inventory: Why Every Company Should Complete One! Jerry P. Bauer 816-822-3527 November 14, 2007 GHG Inventory Before starting, Survey says………. A) Global warming is the most serious threat facing the planet and must be addressed regardless of cost and inconvenience. B) Global warming is a moderate problem that should be addressed but only if costs are not prohibitive and lifestyles not severely impacted. C) Is a hoax. D) Not sure/undecided. Conducting a GHG Inventory Should be Non-Controversial Whether you are an “a, b, c, or d”…. Conducting a GHG inventory & publishing data …Is wise policy …Particularly for a publicly traded company …Is not a political statement …Does not require reducing GHG emissions Reasons for Conducting a GHG Inventory 1. The Public and Investment Community are demanding it! Reasons for Conducting a GHG Inventory 2. Assess companies liabilities/assets going forward. Reasons for Conducting a GHG Inventory 3.May be beneficial if and when allowances are given out under a “cap and trade”. CO2 Allowances $ Reasons for Conducting a GHG Inventory 4. Some companies are reducing GHG emissions and not documenting the reductions. Investment Community Rankings CERES- • Coalition of investors, environmental groups, and other public interest organizations. • Influences $ 3.0 Trillion in Investment Assets • Published a report in March 2006, “Corporate Governance and Climate Change: Making the Connection” • Rated Companies on “performance” related to GHG emissions and climate change The Grades # 1 Who got A s? • Dupont (85 out of 100) • BP (90) The Grades Who got F s? • Williams (3 out of 100) • UAL (3) • ConAgra (4) The Grades Who got ? •Exxon Mobil (35) Investment Community Rankings How to Get a Failing Grade • Don’t Conduct a GHG Inventory! • Don’t Report GHG Emissions! Investment Community Rankings How to Get a Passing Grade • Absolute minimum requirement: conduct a GHG inventory and publish the data! • Aggressive reduction targets not necessary. What is a GHG Inventory? • Organization’s GHG emission sources, quantities, sinks, and removals. • Should cover direct and indirect emissions • Sinks include forrestration and sequestration (if applicable) Green House Gases Inventory Protocol In accordance with: ANSI/ISO/NSF 14064-1 Greenhouse Gases- Part 1: Specification with Guidance at the Organizational Level for Quantification and Reporting of GHG Emissions and Removals • World Resource Institute (WRI) Greenhouse Gas Protocol- A Corporate Accounting and Reporting Standard GHGs What needs to be Covered in the Inventory • Carbon dioxide, CO2 • Methane, CH4 • Nitrous Oxide, N2O • Hydrofluorocarbons (HFCs) and Chlorofuorocarbons (CFCs) (covers 13 chemicals) • Perfluorocarbons, PFCs (covers 7 chemicals) • Sulfur Hexafluoride, SF6 Not All GHGs are Equal Global Warming Potentials for Common GHGs Global Warming Greenhouse Gas Potential Carbon Dioxide 1.0 Methane 21 Nitrous oxide, N2O 310 HFC 134a 1,300 Sulfur hexafluoride 23,900 Sample GHG Calculation Example Calculation- Converting to CO2-e Emissio Global Metric Tons GHG ns Warming CO2-e (Metric Potential Tons) Carbon 10,000 1 10,000 Dioxide Methane 500 21 10,500 HFC 134a 1.0 1300 1300 Sulfur 0.06 23,900 1434 hexafluoride Totals 23,234 Organizational Boundaries • Identifies which GHG emissions corporation is responsible for • Complex with fractional ownership/ different owner than operator Organizational Boundaries Illustration of Organizational Boundary Determinations Operational Boundaries Define scope of GHG Emissions • Scope 1- Direct GHG Emissions* • Scope 2- Electricity Indirect Emissions* • Scope 3- Other Indirect Emissions# * =Mandatory reporting under ISO # =Optional reporting under ISO Scope 1 Direct Emissions • Combustion Sources • Company owned vehicles • Decomposition of coal, wood, or solid waste. • Leaking valves and flanges in natural gas transmission • CFC and HFC losses from refrigeration equipment • Sulfur hexafluoride losses from electrical equipment Scope 2 Indirect Emissions • Purchased electricity • Purchased steam/chilled water Scope 3 Indirect Emissions • Transportation of purchased material or goods (such as coal deliveries by rail car and fuel oil delivery by truck) • Employee Business Travel • Employees commuting to and from work • Transportation of waste from the company Identifying and Calculating GHG Emissions 1. Identify sources 2. Select calculation approach 3. Collect data and emission factors 4. Calculate emissions from sources 5. Convert to CO2 equivalents 6. Summarize into Scope I, Scope 2, and Scope 3 Emissions Combustion Emission Factors For those that love chemistry… Stoichometry Combustion Emission Factors STOICHEMETRY • Natural gas is about 95% methane • CH4 + 2 02 > CO2 + 2 H2O • Assume 99.9% of natural gas is burned • Therefore, burning 1 volume of natural gas produces 0.95 volume of CO 2 • Use ideal gas law to get density of CO 2 (0.11 lbm/cu ft) Combustion Emission Factors A typical house with a $200/month heating bill • Assume the cost of natural gas is $8.00/thousand cubic feet (MCF) CO2 Emissions $200/month x MCF/$8.00 x 1000 CF/MCF x 0.95 CH 4/1 natural gas x 0.11 lb CO2/ cu ft CO2 x metric ton/2204 lbs = 1.1 metric ton of CO2 Combustion Emission Factors For those not that found of chemistry…… 1. “Calculation Tool for Direct Emissions From Stationary Combustion” 2. “Technical Guidelines- Voluntary Reporting of Greenhouse Gases”, Office of Policy and International Affairs, US DOE. (watch for typos!) 3. “Discussion Paper for a Natural Gas Transmission and Distribution GHG Reporting”, WRI Combustion Emission Factors For those not that found of chemistry Common Factors Helpful CO2 Combustion Emissions Factors Emission Emission Factor Units Process/Fuel Factor Coal Combustion Anthracite 102.58 kg CO 2 /MMBtu Bituminous 92.53 kg CO 2 /MMBtu Sub-bituminous 96.12 kg CO 2 /MMBtu Lignite 95.47 kg CO 2 /MMBtu Natural Gas 119.90 lbs CO2 /1000 cf 52.80 metric tons CO 2 /Billion Btu Aviation Gasoline 18.15 lb CO 2 /gallon Diesel (No. 1 and No. 2) 22.15 lb CO 2 /gallon Gasoline 19.36 lb CO 2 /gallon Jet Fuel (Kerosene) 20.88 lb CO 2 /gallon Fuel Oil (No. 5 and 6) 25.75 lb CO 2 /gallon Propane 12.60 lb CO 2 /gallon Carbon Intensity Ratios • Ratio of GHG emissions to a production ratio that normalizes emissions • Examples: production quantities, kilowatt-hour, vehicle mile traveled • More favorable comparison than absolute GHG emissions Carbon Intensity Ratios Large airline RECOMMENDATIONS 1. Conduct a GHG Inventory and Publish Data 2. Address Scope 1 Direct and Scope 2 Indirect Emissions (Skip Scope 3) 3. Document GHG reductions (energy conservation/productivity improvements) 4. Use “an intensity ratio” to show a favorable GHG emissions trend.