A Greenhouse Gas Mitigation Guide for Electric Utilities

Bren School of Environmental Science and Management 02 November 2004

The Client• Burbank Water & Power

(BWP) is proud of being an energy efficiency and conservation pioneer in the utility sector.

• BWP seeks new ways to incorporate environmental stewardship into its role of power and water provider for the City of Burbank.

• Anticipation of possible greenhouse gas legislation also prompts BWP to plan for the future.

The Global Carbon Cycle

• Anthropogenic activities are significantly increasing the concentration of GHGs in the atmosphere through:

• Fossil Fuel Combustion

• Land-use change

• Wastes

US CO2 Emissions

Utilities 51%

Trans 32%

Industry 17%

-From electricity and heat generation

• In 2002, CO2 emissions totaled 5.6 Gt. Total GHG emissions were 6.9 Gt.

• This amounts to about 25% of the global total. The US is 2nd in emissions per capita following Australia.

GHG Policy & Regulation

• Mandated by treaty

• Effective when 55% of emitters have ratified the protocol

• Tradable credits are gained from emissions reductions, and efficiency projects

INTERNATIONAL(KYOTO)

NATIONAL(1605(b))

REGIONAL(SB 1771)

• Voluntary, includes Reporting of Greenhouse Gases and Climate Challenge program

• Carbon tax and CAFÉ standards not widely accepted

• McCain-Lieberman Act – modeled after Kyoto

• Mandated and voluntary

• CA establishes comprehensive Climate Action Registry

• CA adopted first GHG legislation, AB-1493, for 2009 automobiles

The Problem• Utilities want to act in an environmentally responsible,

economically feasible and politically strategic manner by mitigating their greenhouse gas emissions.

• Information is not readily available on the steps involved or the resources available to help them make an informed choice.

• Utilities need direction regarding the GHG emission mitigation options that are best suited to their needs.

Decision-Making Process:(An overview)

Decision to mitigate

Selection of a strategy

Temporal factors

Decision-making criteria

Preferences

Contract consultants

Economic considerations

Baseline emissionsMitigation

options

Available technology

Environmental impactsRegulatory

considerations

Logistics

Key questions

The Solution• A Greenhouse Gas Mitigation Guide for

Electric Utilities

• Purpose: - Guide utilities through the decision

making process.- Help them make better-informed

mitigation choices.

• Includes:– Background (Scientific & Policy)– Tasks for the utility – Key questions to ask– Resources to use along the way

I. IntroductionII. Background - Policy and Science context - DefinitionsIII. List and description of mitigation optionsIV. Assessing existing emissions and offsetV. How to screen the options: Developing a

subset of mitigation strategies from the pool of options.

VI. How to assess and compare the mitigation strategies.

Parts of the Guide:

Parts of the Guide:

VII. Project steps (description & case study) Example: Reforestation Steps 1. Site/species selection. 2. Site preparation. 3. Seed supply & labor. 4. …

VIII. Resource list (a) Turnkey facilitators/contractors (b) Step-specific facilitators/contractors 1. Planning 2. Monitoring

3. Verification

Resources

III. Mitigation Options

•Afforestation / Reforestation

•Industrial process modifications

•Bio-mass to energy and bio-diesel

•Agricultural sequestration

•Renewable energy transitions

•Bio-mass to product

•Geological formation injection

•Ocean injection

•Mineral carbonation

•Efficiency increases (Buildings,

transportation, construction)

•Methane capture (Landfill,

wastewater treatment, agriculture)

•Ocean seeding

SEQUESTRATION

REDUCTION CAPTURE AND USE

V. How to screen the options(a close-up look)Elimination Criteria:(a)Expected timeframe for implementation > 5 yrs.

Mineral Carbonation; Ocean Injection

(b) High level of uncertainty in terms of efficacy and potential negative ramifications.

Ocean Seeding; Ocean Injection

(c) Explicitly unacceptable in existing treaties and regulations.

Ocean Injection

VI. How to assess and compare the options

• Economic considerations– Short-term capital and startup costs– Projected operational costs– Potential revenue sources– Capitalizing on existing relationships

• Environmental considerations– Additionality/Baseline– Leakage– Ancillary benefits/losses

• Perception of the strategy– Preferences of the utility– Cost vs. benefits to stakeholders– Public opinion of the strategy

VI. How to assess and compare the options

• Methodological considerations

– Full-cycle accounting of net GHGs of a project

– Quantification, monitoring and verification

– Implementation timeframe– Longevity– Permanence– Is the strategy adaptive (flexible)?

•Policy considerations– How is the strategy regarded within a

regulatory climate?• Recognized, modified, or mandated?

– Will reduction credits be valued the same?– How will policy shape decisions on the other

considerations?• Economic, temporal, environmental, and perception

VI. How to assess and compare the options

VI. How to assess and compare the options

– Cost-effectiveness analysis (cost per ton of CO2)

– Return On Investment (ROI)– Full cycle accounting– Analytical Hierarchy Process (AHP)– Key questions

Tools

Conclusions• A guidance document is needed by electric utilities

to assist in the planning and implementation of GHG mitigation projects and must address the following:

– Explanations of the various mitigation options, pros and cons

– Direction on how to approach a mitigation project

– Guidance on how one would select a specific mitigation option

– Types of information and contracting resources available

– Company-specific information that is needed to add to the process

Questions & Comments?

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