Disclaimer and copyright. Allocation in phase 3 of EU ETS. General information. Identify relevant technical connections

Transcription

1 0 Disclaimer and copyright Allocation in phase 3 of EU ETS Case study: integrated steel mill 2 May 2011 This workshop is conducted in the framework of a project for DG Climate Action. However, the Commission is not responsible for the correctness, completeness or quality of the information provided. The contents of these slides are based on the guidance documents as endorsed by the Climate Change Committee on 14 April 2011 and by no means substitute the legal text Any values used in examples do not necessarily reflect existing situations and are only meant for illustrative purposes. Ecofys makes no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability with respect to the information in this presentation. Any reliance you place on such information is therefore strictly at your own risk and Ecofys is not liable for any damage whatsoever arising from the use of this information The copyright of this presentation is reserved. It may therefore not be used for any purpose without the explicit permission of Ecofys 1 General information Simplified integrated iron and steel Is the installation eligible for free allocation? Yes Numbers used in this example are fictitious!!! Is the installation an electricity generator pursuant Art. 3(u)? No What is the chosen baseline period? Did the installation operate at least one day in each calendar year in the baseline period? Yes Greenhouse Gas Emissions and Energy from fuels I Data collection template: tab D_Emissions 3 Total Direct Greenhouse Gas Emissions and Energy Input from s Result of installation level data for use in sheets "D_Emissions" and "E_EnergyFlows": Installation level data: Total CO2 emissions Memo-Item: Biomass emissions Total N2O emissions Total PFC emissions Total direct emission of the Installation Total energy from fuels t CO2 / year 12,000,000 14,000,000 12,000,000 8,000,000 t CO2 / year t CO2e/year t CO2e/year t CO2e/year 12,000,000 14,000,000 12,000,000 8,000,000 TJ / year 85, , , , PJ 8.7 PJ 9.9 PJ 33 PJ 7.1 Mt 2.6 Mt 4.2 PJ 4.2 PJ 6.3 Mt 2 3 Case Study - Simplified integrated iron and steel Identify relevant technical connections 4 5

2 6 Identify relevant technical connections A sinter product benchmark sub-installation IV List of technical connections No. Name of installation or entity Type of entity Type of connection Flow direction 1 Installation covered by ETS Export 2 Installation covered by ETS Export No. Installation ID used contact person address phone in CITL Name of number John Smith name@etsinstallation.eu A N Other @etsinstallation.com A sinter product benchmark sub-installation A coke product benchmark sub-installation III List of sub-installations 1 Product benchmark sub-installations No. Product type CL exposed? changes? 1 Sintered ore 2 N.A. 3 N.A. 4 N.A. 8 9 A coke product benchmark sub-installation A hot metal benchmark sub-installation III List of sub-installations 1 Product benchmark sub-installations No. Product ETS type CL exposed? changes? Permit 1 Sintered ore 2 Coke / 3 N.A. 4 N.A

3 12 A hot metal benchmark sub-installation III 1 List of sub-installations Product benchmark sub-installations No. Product type 1 Sintered ETS ore Permit 2 Coke 3 Hot metal / 4 N.A. CL exposed? changes? A heat benchmark sub-installation - exposed Covered by heat benchmark sub-installations consumption outside product benchmark sub-installations export to non-ets Hot entities Metal Non-covered: consumption by product benchmark sub-installations export to other ETS installations consumption for of electricity 13 A heat benchmark sub-installation- exposed A fuel benchmark sub-installation- exposed Covered by fuel benchmark sub-installation consumption outside product benchmark sub-installations / III List of sub-installations 2 Sub-installations with fall-back approaches No. Sub-installation type relevant? CL exposed? changes? 11 benchmark sub-installation, CL TRUE 12 benchmark sub-installation, non-cl Non-covered: consumption by product benchmark sub-installations consumption for of measurable heat or electricity FBMexposed A fuel benchmark sub-installation- exposed Process emissions sub-installation III List of sub-installations / 2 Sub-installations with fall-back approaches No. Sub-installation type relevant? CL exposed? changes? 11 benchmark sub-installation, CL TRUE 12 benchmark sub-installation, non-cl 13 benchmark sub-installation, CL TRUE 14 benchmark sub-installation, non-cl FBMexposed No process emissions sub-installations No process emissions are produced outside the boundaries of product benchmark sub-installations. There are consequently no process emissions sub-installations 16 17

4 18 Process emissions sub-installation List of sub-installations / III 2 Sub-installations with fall-back approaches No. Sub-installation type relevant? CL exposed? changes? 11 benchmark sub-installation, CL TRUE 12 benchmark sub-installation, non-cl 13 benchmark sub-installation, CL TRUE 14 benchmark sub-installation, non-cl 15 Process emissions sub-installation, CL FALSE TRUE 16 Process emissions sub-installation, non-cl Exact data for measurable heat consumption/export is necessary for heat benchmark sub-installation Exact data on energy is necessary for fuel benchmark sub-installations Exact emissions is necessary if a process emissions subinstallation would be present Nevertheless, to be able to check completeness and consistency (Art. 7.7), operators will: In the data collection template: estimate the attribution of all other emissions, energy and measurable heat In the methodology report: describe the attribution 19 Exact data for measurable heat consumption/export is only necessary for heat benchmark sub-installation Exact data on energy is only necessary for fuel benchmark sub-installations The data collection template contains a simple and a complex tool to determine the balance of measurable heat flows: the table below only shows the outcome of the complex tool: Data collection template: tab E_EnergyFlows II Measurable heat 3 Summary of heat sub-installations benchmark sub-installation, CL benchmark sub-installation, non-cl TJ / year 5, , , , TJ / year Data collection template: tab E_EnergyFlows I Energy from fuels 1 Overview and split into use categories Usage type of fuel to electricity TJ / year for of measurable heat TJ / year 5, , , , as part of product benchmarks TJ / year 73, , , , benchmark sub-installation, CL TJ / year 5, , , , benchmark sub-installation, non-cl TJ / year Rest TJ / year Product benchmark sub-installations (all three shown together and highlighting product flows only) Exact emissions would only be necessary if a process emissions sub-installation would be present Data collection template: tab D_Emissions II Attribution of emissions to sub-installations 2 Attribution to sub-installations Installation level data: Emissions related to product benchmarks % Emissions related to heat benchmark subinstallations % Emissions related to fuel benchmark subinstallations % Process emissions sub-installation, CL % Process emissions sub-installation, non-cl % Control: Other emissions (non-eligible) % Chosen baseline: No changes in operation No significant changes in capacity HAL = median( annual levels) 22 23

5 24 Product benchmark sub-installation benchmark sub-installation - exposed Chosen baseline: No changes in operation No significant changes / capacity HAL = median( annual activity levels) Data collection template: tab F_ProductBM (example for sintered ore) So HAL= median (10.7, 12.5, 10.7, 7.1)=10.7 Mt 25 benchmark sub-installation - exposed benchmark sub-installation- exposed Chosen baseline: No changes in operation No significant changes in capacity Data collection template: tab G_Fall-back (for heat benchmark exposed to CL) / HAL = median( annual activity levels) So HAL= median (5950, 7000, 5950, 4200)=5950 TJ FBMexposed benchmark sub-installation- exposed Determine preliminary total allocation Without considering carbon leakage status Data collection template: tab G_Fall-back Sinter sub-installation: BM Sinter [EUA/t product] x HAL Sinter [Mt product] Coke sub-installation BM Coke [EUA/t product] x HAL Coke [Mt product] / So HAL= median (5950, 7000, 5950, 4200)=5950 TJ FBMexposed sub-installation BM Hot metal [EUA/t product] x HAL Hot metal [Mt product] benchmark sub-installation: BM H [EUA/TJ heat] x HAL H [TJ heat] benchmark sub-installation: BM F [EUA/TJ fuel] x HAL F [TJ fuel] Preliminary total allocation: (not considering CL-status) BM: HAL: EUA: Benchmark Historical activity level Allowances Sum of the above The allocation without considering CL-status is the same for each year The allocation without considering CL-status is needed for the Commission to determine the need for a cross-sectoral correction factor 28 29

6 30 Determine preliminary total allocation Without considering carbon leakage status Sinter sub-installation: Coke sub-installation sub-installation [EUA/t product] x 10.7 [Mt product] [EUA/t product] x 3.8 [Mt product] [EUA/t product] x 9.4 [Mt product] benchmark sub-installation: 62.3 [EUA/TJ heat] x 5950 [TJ heat] benchmark sub-installation: 56.1 [EUA/TJ fuel] x 5950 [TJ fuel] Preliminary total allocation: (not considering CL-status) BM: HAL: EUA: Benchmark Historical activity level Allowances 16.1 million allowances The allocation without considering CL-status is the same for each year The allocation without considering CL-status is needed for the Commission to determine the need for a cross-sectoral correction factor Determine preliminary total allocation Considering carbon leakage status Product benchmark sub-installations BM P [EUA/t product] x HAL P [t product] x CLEF benchmark sub-installations: BM H [EUA/TJ heat] x HAL H [TJ heat] x CLEF benchmark sub-installations: BM F [EUA/TJ fuel] x HAL F [TJ fuel] x CLEF Preliminary total allocation: (considering CL-status) BM: Benchmark HAL: Historical activity level EUA: Allowances CLEF: Carbon leakage exposure factor Sum of the above - For not-exposed sectors (80% in 2013, 30% in 2020) - For exposed sectors (100% from 2013 to 2020) The allocation with consideration of CL-status can differ from year to year The CL-status may change in the future 31 Determine final total allocation (not in NIMs) In this case the installation is not an electricity generator (pursuant to Art 3(u)); so: Final allocation = F instal,prel. (k) x CSF (k) F instal,prel. (k): CSF (k): Preliminary allocation considering CL-status in year k Cross-sectoral correction factor in year k (if applicable) In case the installation would have been an electricity generator, then: Final allocation = F instal.prel (k) x F instal.prel (2013) x (k 2013) F instal,prel. (k): Preliminary allocation considering CL-status in year k Linear reduction factor 32