Project-based mechanisms for climate protection (2): Further Quality Criteria


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This presentation is part II of a threefold presentation set that stems from the workshop "Further Development of the Joint Implementation (JI) Mechanism: Net mitigation effects and other Quality Criteria". This second part deals with lessons learned and general conditions for quality criteria. Sina Wartmann and Carsten Warnecke, Senior Consultant International Climate Policies at Ecofys, gave this presentation at the joint workshop of the Federal German Environment Agency and the German Emission Trading Authority on 24 September 2012.

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Project-based mechanisms for climate protection (2): Further Quality Criteria

  1. 1. Sina Wartmann/Carsten Warnecke24.09.2012Further Quality CriteriaPart II of the project„Project-based mechanisms for climateprotection in Europe: Net-mitigation-effectsand further development of the JointImplementation (JI) Mechanism”
  2. 2. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeOverview> Objectives> Lessons learned from existing systems> General considerations for quality criteria> Sustainability criteria for Germany> Biomass criteria for Germany> Inventory integration> Summary
  3. 3. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeObjectives> Part I considered further development with regards to Net-mitigation-effect approaches> Part II addresses further quality criteria on the basis of going“beyond pure offsetting”> Focus on two issues for Germany:– Sustainability criteria – what is needed in Germany?– Biomass sustainability – ongoing discussion at EU level
  4. 4. © ECOFYS | |Lessons learned from existing systems24.09.2012 Sina Wartmann/Carsten Warnecke
  5. 5. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeLessons learned from existing systems ISystems considered:> Offsetting Systems- CDM- JI- Domestic offsetting in EU countries> Voluntary Standards:– Gold Standard– Climate, Community and Biodiversity Project Design Standard(CCB)– Social Carbon Standard> Buyer‘s Initiatives> Biomass sustainability requirements
  6. 6. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeLessons learned from existing systems II> Most systems only focus on complete coverage of greenhouse gasemissions> Criteria for sustainable development and co-benefits mostly laid downat a general mechanism level and at low level of detail.– Development at project or technology level only with specialisedsystems, e.g. SocialCarbon Standard– Sustainable development objectives difficult to meet withouttransparent criteria and procedures> Implementation of further quality criteria mostly limited to an ex-anteapproach by the definition of the eligibility of project types or by thedefinition of applicability criteria in the technology specificmethodologies.– Only few mechanisms and initiatives define criteria that will beassessed ex-post.– Ex-post assessment requires guidance and mandate for verifier> Requirements for quality criteria can be a relevant factor for cost-effectiveness!
  7. 7. © ECOFYS | |General Considerations on quality criteria24.09.2012 Sina Wartmann/Carsten Warnecke
  8. 8. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeGeneral considerations on quality criteria> Aim to achieve positive impacts or avoid negative impacts> Negative impacts to be generally avoided or compensation allowed?> Apply positive lists/negative lists, detailed criteria?> Relevant elements of quality criteria include:– verifiable indicators,– stakeholder involvement,– ex-ante assessment and/or ex-post monitoring and reporting ofeffects,– Verification/validation, ideally by independent third party– enforcement and sanctioning> Approaches supporting cost-effectiveness:– apply ex-ante assessments to the extent possible, require ex-postassessment only where absolutely necessary.– Address unregulated issues of concern beyond the offsetmechanism, with general legislative measures
  9. 9. © ECOFYS | |Sustainability Criteria for Germany24.09.2012 Sina Wartmann/Carsten Warnecke
  10. 10. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeSustainability Criteria for Germany> Existing systems do not use a common definition of sustainability> Agenda 21 resulting from the United Nations Conference onEnvironment and Development held in Rio in 1992 providescommon definition> Germany: „development“ aspect of less importance – focus ondo-no-harm approach> Development of do-no-harm criteria based on NationalSustainability Strategy and its progress reports
  11. 11. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeGerman sustainability strategy> The Progress Report 2012 to the National Sustainability Strategyidentifies a number of issues of concern> These issues might be used as basis for the development of do-no-harm criteria for GermanyIssues of concern from the Progress Report 2012Economic topics Environmental topics Social topicsSustainable financepolicy•Sustainable mobility•Sustainable consumptionand production•Conservation andmanagement of naturalresources• Reducing consumptionof land resources• Biodiversity• Sustainable fisheriesindustry• Agriculture andforestry•Health•Social integration,demographics andmigration•Global challenges relatedto poverty and sustainabledevelopment•General and professionaleducation•Research and development
  12. 12. © ECOFYS | |Relevant factors for criteria development24.09.2012 Sina Wartmann/Carsten WarneckeSustainability Topic Relevant factors for criteria developmentSustainable water policy• Reducing building activities in inundation zones required toreduce the risk of damages through flooding• Reducing or avoiding use of agricultural pesticides, wherethere is a danger of input into the ground water• Reduce water intensive cultures in regions with waterscarcitySustainable consumption and production• Avoiding products which cannot be recycled• Avoiding large packaging of productsReducing consumption of land resources • Avoid increasing areas for settlement and transportationBiodiversityAvoid activities reducing biodiversity through• Intensive agriculture and forestry• Sealing the ground, dissection of natural areas• Input of pollutants into soil, water or airAgriculture and forestry• Ensure animal welfare• Reduce input of nitrogen into the soil• Reduce soil erosion and compaction• Support organic farming• Ensure compliance with the principles of the “Foreststrategy 2020”
  13. 13. © ECOFYS | |Criteria for biomass sustainability in Germany24.09.2012 Sina Wartmann/Carsten Warnecke
  14. 14. © ECOFYS | |Criteria for biomass sustainability> Suggestions: Use existing sustainability requirements under the EURenewable Energy Directive (EU RED) as basis and assess need foradditional requirements> EU RED currently covers biofuels and bioliquids> GHG-balance addressed through minimum CO2-reduction to be achievedover lifetime compared to conventional fuels> Avoid negative carbon balance and biodiversity loss through avoidanceof land-use change> Implementation currently mainly through voluntary certification systems> At present eight certification systems approved, systems vary greatlywith regards to coverage> Key points considered in the assessment:- GHG balance- Further criteria24.09.2012 Sina Wartmann/Carsten Warnecke
  15. 15. © ECOFYS | |GHG-balance> The EU RED already addresses the CO2-balance for biofuels andbioliquids over the whole lifecycle of the biomass> Carbon stock changes also addressed through requirement to avoiddirect land-use changes> Certain potential impacts not covered:– Loss of soil carbon stocks through crop growing/removal of harvestingresidues– Methane losses in biogas plants– For solid biomass forest carbon stock needs to be additionally covered> EU RED provides a good basis, but no full coverage of GHG-relatedimpacts> Our suggestion for a German offsetting mechanism: Additionally usethe existing qualitative and quantitative methodological JI and CDMrules– Considered as complete– Tested in many project activities– Ensure consistency between credited project mechanisms24.09.2012 Sina Wartmann/Carsten Warnecke
  16. 16. © ECOFYS | |Further quality criteria> Important: Impacts on biomass generation might occur inside oroutside of Germany> The EU RED currently only covers biodiversity throughrequirements aiming to avoid land-use change.> The EU RED foresees to add requirements with regards to air,water or soil quality, working conditions, land rights, etc. if needis identified> Need for additional requirements assessed through biannualreporting by the EU Commission24.09.2012 Sina Wartmann/Carsten WarneckeSuggestion for criteria categoriesbased on Agenda 21:•Air, water, soil quality•Water quantity•Biodiversity•Land rights•Stakeholder involvement•Working conditions
  17. 17. © ECOFYS | |Implementation of sustainability criteria forbiomassGermany EU Non-EUGHG-related +further criteriawell covered• Forestmanagement• Air, water quality• Water quantity• Biodiversity• Land rights• Stakeholderinvolvement• Working conditions• Air, water quality• Water quantity• Biodiversity• Land rights• Stakeholderinvolvement• Working conditionsCoverage depends onnational legislationand itsimplementationRemaining issues •No provisions for soilcarbon management•Forest managmentnot necessarilyensured at nationallevel•No provisions for soilcarbon managementSuggested actionfor offsettingmechanismApply GHG balanceaccording to CDMrulesApply full GHGbalance according toCDM rules or requireFSC certification /comparable standardApply full GHGbalance according toCDM rules andrequire certificationaccording to theRoundtable onSustainable biofuelsor comparablestandard24.09.2012 Sina Wartmann/Carsten Warnecke
  18. 18. © ECOFYS | |Inventory Integration24.09.2012 Sina Wartmann/Carsten Warnecke
  19. 19. © ECOFYS | |Inventory integration> Domestic offset projects reduce emissions -> reduction should bereflected in national inventories> Often project-level approach with domestic offsetting project vs top-down approach in national inventory> Emission reductions potentially not fully mirrored in inventory> Example JI: AAU amount at country level is reduced, while amount ofAAUs to be turned in at the end of the Kyoto period might not bereduced to the same level> Bringing the overall inventory to the necessary level of detail difficult> Suggestions:– Use information from domestic offset projects for improvement ofnational inventory– Create interface allowing to deduct the emission reductions fromoffset projects from the inventory emissions at the end of theKyoto period24.09.2012 Sina Wartmann/Carsten Warnecke
  20. 20. © ECOFYS | |Summary> Considerable experiences with quality criteria exist, but fewsystems combine detailed criteria with strict implementation> Combine ex-ante assessments (where possible) with ex-postassessments (where necessary)> Combine negative lists with criteria to ensure quality and retainsearch mechanism> Sustainability criteria for Germany might follow a do-no-harmapproach> Sustainability criteria for Germany could be developed based onthe key-areas identified in the sustainability strategy progressreport> EU RED provides good basis for biomass sustainability criteria,but additional criteria are needed to provide full coverage> Mirroring of emissions in inventories desirable, but subject tolimitations24.09.2012 Sina Wartmann/Carsten Warnecke
  21. 21. © ECOFYS | |24.09.2012 Sina Wartmann/Carsten WarneckeThank you.Contact:Carsten WarneckeSenior ConsultantInternational Climate PoliciesT: +49 (0)221 270 70 204M: +49 (0)172 297 39 08E: