2013 Community Benefit Sharing Study: Local Community
Benefit Sharing Mechanisms and Options for CO2 Storage
Projects
13 N...
Study background and aims
Background to the study:
• In 2011, the CO2 Capture Project conducted a review and analysis of c...
Context – what is benefit sharing?

• The concept of benefit sharing stems from the acknowledgement that the siting of som...
Findings: Benefit sharing within the broader
social risk and impact management process
A review of case studies and discus...
Findings: Benefit sharing options (1):
Maximising direct and indirect positive impacts

• International experience with be...
Findings: Benefit sharing options (2):
Community investment programs
• Another way to ensure local communities benefit
fro...
Findings: Adopting a strategic approach to
community benefits
• It is important to adopt a strategic approach to community...
Analysis: Benefit sharing in the CCS context (1)
• Benefit sharing can be (and has been) applied in the context of a CCS d...
Analysis: Benefit sharing in the CCS context (2)
CCS benefits gap analysis

• Considering different CCS project
types or ‘...
Analysis: Options for benefit sharing with CO2
storage host communities
• (Non-EOR) CCS projects may need to think creativ...
Summary of main conclusions
• Local community benefit sharing can help to address the potential imbalance between local
co...
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2013 Community Benefit Sharing Study: Local Community Benefit Sharing Mechanisms and Options for CO2 Storage Projects

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2013 Community Benefit Sharing Study: Local Community Benefit Sharing Mechanisms and Options for CO2 Storage Projects

  1. 1. 2013 Community Benefit Sharing Study: Local Community Benefit Sharing Mechanisms and Options for CO2 Storage Projects 13 November 2013 COP19 Warsaw: IETA CO2 Capture Project Side Event CO2 Capture Project (CCP) Policy & Incentives Team
  2. 2. Study background and aims Background to the study: • In 2011, the CO2 Capture Project conducted a review and analysis of carbon, capture and storage (CCS) stakeholder issues. • One of the key findings from the study was that local communities are more likely to become actively involved and oppose CCS project developments when there are no apparent benefits to the community itself. This study aims to explore this finding further, and investigates experience with local community benefit sharing in the oil and gas sector, and options for local community benefit sharing in the context of a CCS development.
  3. 3. Context – what is benefit sharing? • The concept of benefit sharing stems from the acknowledgement that the siting of some facilities can have real or perceived negative impacts on host communities that could outweigh the real or perceived benefits to those communities brought by the development. • This can be the case for large developments which bring regional or national benefits, but where the costs (in terms of visual impact, noise, etc.) are borne for the most part by the host community, which may feel distant from the regional or national benefits o E.g. oil and gas extraction / processing projects; mining projects; dams; renewables; landfills; large infrastructure developments; CCS developments. • Experience with past project developments suggests that project acceptance by local communities can be influenced by the extent to which negative impacts are minimised, and positive impacts (e.g. employment; local procurement of goods and services) are maximised.
  4. 4. Findings: Benefit sharing within the broader social risk and impact management process A review of case studies and discussions with project managers and stakeholder management experts highlights that: • Benefit sharing is not a stand-alone exercise. It should be one part of the stakeholder engagement process, and will form part of a project’s social management plan. • Before benefit sharing is discussed in detail, developers should first seek to identify and manage any negative impacts from a development. Benefit sharing
  5. 5. Findings: Benefit sharing options (1): Maximising direct and indirect positive impacts • International experience with benefit sharing highlights a number of different forms of benefits associated with developments. • Benefits to local communities can stem directly or indirectly from the project itself, or can be shared through specific community investment programs.
  6. 6. Findings: Benefit sharing options (2): Community investment programs • Another way to ensure local communities benefit from projects is through direct investment in local communities o By paying money into a community fund or Trust; or o By investing in specific community projects. • Principles for a successful community investment program include: o Involving multiple stakeholders in the planning & implementation of projects, including local / community stakeholders o Establishing a fund Committee / Board including the project developer and key community stakeholders to manage the fund o Designing a set of Principles and Objectives to govern how the fund is managed and where money is spent o Developing metrics to allow the success of the fund and related projects to be measured over time o Ensuring that the community leads the decision on how funds are spent
  7. 7. Findings: Adopting a strategic approach to community benefits • It is important to adopt a strategic approach to community benefits to ensure there is a positive and long-lasting impact on communities. The following principles should apply if a benefit sharing program is to be effective and successful:
  8. 8. Analysis: Benefit sharing in the CCS context (1) • Benefit sharing can be (and has been) applied in the context of a CCS development. • With CCS projects, it is important to note that most of the direct and indirect positive impacts associated with a development (jobs, procurement, etc.) will apply to communities hosting the CO2 capture plant.
  9. 9. Analysis: Benefit sharing in the CCS context (2) CCS benefits gap analysis • Considering different CCS project types or ‘scenarios’, it is apparent that there is frequently a lack of direct and indirect project benefits at the storage stage – often where the greatest perceived impacts lie. • There may be more positive impacts for communities hosting storage sites where enhanced oil recovery (EOR) (i.e. carbon capture, utilisation and storage, CCUS) is taking place (Scenario 3). • However, overall, there appears to be a potential ‘benefits gap’ for communities hosting CCS storage sites.
  10. 10. Analysis: Options for benefit sharing with CO2 storage host communities • (Non-EOR) CCS projects may need to think creatively about how to fill the ‘benefits gap’ at the storage stage, and how to create a value proposition for communities hosting a CO2 storage site. • An analysis of the drivers for a CCS project may help to identify a preferred approach to sharing benefits with storage communities. Commercially-driven projects could consider revenue sharing or community investment for CO2 storage host communities Government-backed projects could consider shared Government / developer community benefit and investment programs, and could consider how direct and indirect positive impacts can be distributed across CCS stages
  11. 11. Summary of main conclusions • Local community benefit sharing can help to address the potential imbalance between local costs vs. national or international benefits associated with some major developments. • Benefit sharing options include: o 1) maximising the direct and indirect positive impacts of a project (such as employment, local procurement, and wider economic benefits); and o 2) enhancing local benefits through strategic community investment programs. • In the context of a CCS project, benefit sharing needs to be considered particularly at the storage stage where frequently the greatest public concerns lie, yet where project activities are unlikely to offer significant benefits to communities in terms of jobs, procurement, local spend, etc. • Options for benefit sharing with CCS storage communities might include: o Revenue-sharing (if projects are commercially-driven) – CO2 credits; revenues from EOR; etc. o Community investment programs (if projects are government-funded) – e.g. education programs, on-site visitor / learning centres, environmental initiatives, social initiatives, etc. • Benefit sharing is not a ‘silver bullet’ when it comes to local acceptance: it must be incorporated into a robust social management process and impact management.

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