Addressing double counting of mitigation for diverse contribution types
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Transcript of Addressing double counting of mitigation for diverse contribution types
Climate Change Expert Group www.oecd.org/env/cc/ccxg.htm
Presentation to SBSTA8 June 2014
Addressing double counting of mitigation
for diverse contribution
typesChristina Hood (IEA)
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OECD/IEA papers on UNFCCC emissions accounting options
Concepts relevant pre- and post-2020
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Outline
Double counting of mitigation
Mitigation transfers with single-year targets
Potential rules/criteria for “opt-in” to use of market or non-market mitigation transfers
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Outline
Double counting of mitigation
Mitigation transfers with single-year targets
Potential rules/criteria for “opt-in” to use of market or non-market mitigation transfers
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Which transfers matter for accounting?Two conditions under which transfers of mitigation
matter for UNFCCC accounting:
Could include credits (offsets), allowance units from domestic emissions trading systems, or non-market transfers
“Used” by a Party as counting directly towards a contribution under UNFCCC
Originating outside the boundary of that contribution(geographic, scope or temporal)
+
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Double counting of mitigation
“Double issuance” = more than one unit issued for the same emissions reductions
“Double selling” or “double retirement” = same unit used more than once towards emissions obligations
“Double claiming” against pledges/targets = same mitigation claimed by two jurisdictions
“Double coverage” of transferred mitigation by GHG and non-GHG targets leading to double counting
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Double Counting Solutions
Double Issuance
Strong governance of mechanisms for environmental integrity
Double Selling Robust registry/tracking arrangements
Double claiming between GHG targets
Understand by tracking/reporting transfersPrevent by rules/criteria
GHG/Non-GHG double coverage
Understand by tracking/reporting transfers
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Double claiming example
Emissions inventory total = 90+110 = 200Mt
If Party A DOES NOT account for export but party B DOES account for import, then declared total = 90+100 = 190Mt
Emissions 100Mt Emissions 100Mt
10MtParty A
-10Mt
--------110Mt
--------90Mt
Party B
Inventory granularit
y?
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What do Parties want to “prevent” ?
1. Prevent double counting in aggregate ex post reconciliation of total mitigation ? track actual unit and non-market useEnables understanding of double claiming to prevent double counting of
aggregate emissions reductions
2. Also prevent or limit double counting in ex ante estimates of expected mitigation ? requires rules for market or non-market use
e.g. quantitative limits on use of transferred mitigation from jurisdictions that do not account for unit flows (i.e. limit double claiming)
e.g. GHG goals must account for unit flows (i.e. prevent double claiming)
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Double counting via “double coverage” of GHG/non-GHG
targetsParty A Party B How double counting could arise
Quantified GHG target
Renewable energy (capacity)
If renewable energy target delivered in part by crediting mechanism (with units sold to Party A), could be double counting of mitigation.
Renewable energy (transfers)
Renewable energy (capacity)
With trade of green certificates between Party A and B, there is potential for double counting if one Party accounts for the transfers and the other doesn’t.
Quantified GHG target
Production of clean electricity
If electricity is exported from Party B to Party A via grid interconnection, the mitigation could be counted by both Parties.Understand by tracking/reporting
transfers
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Outline
Double counting of mitigation
Mitigation transfers with single-year targets
Potential rules/criteria for “opt-in” to use of market or non-market mitigation transfers
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Multiple-year target
100Mt
20302020
90Mt
80Mt
2025
2030 target
Multi-year emissions target
Annual unit purchases
2030 inventor
y
Actual reported inventory emissions
Multi-year target avoids risk that emissions in single target year are unrepresentative of general trend
Facilitates use of market mechanisms
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Single-year target
100Mt
20302020
90Mt
80Mt
2025
2030 target
2030 inventor
y
Actual reported inventory emissions
Ex ante uncertainty over total emissions due to unknown path to target
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Single-year target
100Mt
20302020
90Mt
80Mt
2025
2030 target
Ex ante uncertainty over total emissions due to unknown path to target
Ex ante uncertainty amplified by use of units in target year
Gets complex when we think about “vintages” of units
2030 inventor
yActual reported inventory
emissions
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Options for use of mitigation transfers with single year targets
Report unit use
• allows ex-post reconciliation• poor ex-ante estimation
Quantitative limit
• Reduces ex-ante uncertainty
Target year vintage only
• Impractical (supply ongoing) • Prone to gaming (Scneider et
al.)
Only units from ongoing action
• If units are retired for multi-year goals (e.g. domestic ETS), then ok
Disallow • Only continuous multiyear goals can use transferred mitigation
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Outline
Double counting of mitigation
Mitigation transfers with single-year targets
Potential rules/criteria for “opt-in” to use of market or non-market mitigation transfers
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Ex-ante clarity on expected total abatement
and national goals
3. Avoidance of double claiming
•Ex post reporting of flows•Provide ex ante estimate of expected flows•GHG based contributions must account for flows, must be multi-year.
•Ex post reporting of flows•Provide ex ante estimate of expected flows•Quantitative limit on units issued by Parties with GHG goals that do not account for flows.•Units in single-year targets must be reflective of continuous action
Packages of rules for Parties “opting in” to use of market or non-market
transfers
2. Enhanced clarity
1.Transparency Approach
*flows = issuance, retirement, transfers, banking
[PLUS: governance of systems, registry and tracking arrangements]
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Thank you for your attention
GHG or not GHG: Accounting for diverse mitigation contributions in the post-2020
climate frameworkChristina Hood ([email protected])
Gregory Briner ([email protected])
Marcelo Rocha
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