CLIMATE ASPECTS OF HCFC CONVERSION METHODOLOGIES TO ACCESS CARBON FINANCE

Transcription

1 CLIMATE ASPECTS OF HCFC CONVERSION METHODOLOGIES TO ACCESS CARBON FINANCE Julie Godin World Bank Carbon Finance Unit April

2 Outline ENERGY EFFICIENCY IN THE CONTEXT OF GLOBAL CLIMATE CHANGE MITIGATION METHODOLOGIES TO ACCESS CARBON FINANCE SCALING-UP ENERGY EFFICIENCY UNDER THE CDM 2

3 GHG Emission Reduction Scenarios Energy Efficiency is the Lowest Hanging Option Scenario 2050 (IEA) End-use EE is crucial End-use efficiency Power generation Coal to gas Nuclear Fossil fuel generation efficiency CCS Improved end use (demand side) energy efficiency most important contributor to reduced emissions Biofuels in transport Fuel mix in buildings and industry CCS in industry CCS in fuel transformation Hydropower Biomass Other renewables Offers immediate opportunities for emission reductions and results in cost savings Source: IEA Energy Technology Perspectives

4 Importance of Energy Efficiency in Climate Change Mitigation Buildings are responsible for more than 30% of the total energy consumption globally, A/C dominates the demand in hot climates (IPCC 2007). Rapid adoption of domestic appliance: a challenge to electricity supply. e.g. In China, the adoption of air conditioners by urban residents had increased from 8% in 1995 to 70% in 2004 and for refrigerators from 66% to 90% (IEA 2007). IEA estimates that in the next two decades energy demand in developing country cities will increase by 81 %(IEA 2008). Benefits of EE appliances program : impact on peak demand, reduce burden on low income households (CERES, 2008). e.g. adoption of California energy efficient standard in China in the refrigeration and A/C sectors would result in 90 TWh/y of energy saved (R. Host, UC Berkley, 2009). 4

5 METHODOLOGIES TO ACCESS CARBON FINANCE 5

6 Overview of CDM Methodologies Power Saving through EE Appliances (A/C, Refrigerators, Chillers) Methodologies Summary of Applicability Conditions Energy Efficient Technologies (AMS IIC) Activities that encourage the adoption of energy efficient equipment, e.g., refrigerator, chiller, A/C. Replacement of existing equipment or new activities Aggregate energy saving may not exceed 60 GWh/y. Chiller Replacement (AM0060) Activities that replace existing chillers by more EE chillers. Replacement is not required directly by law or regulations. Existing chiller shall be destroyed. Refrigerant shall be recovered and destroyed, or store for reuse. Source: unfccc.int 6

7 Overview of CDM Methodologies EE Measures and HFCs Reductions in the Refrigeration Sector Methodologies Summary of Applicability Conditions Energy Efficiency and HFC-134a Recovery in Residential Refrigerators AMS IIIX Activities that replace existing, functional domestic refrigerators with more efficient units utilizing refrigerants and foam blowing agents having no ODP and low GWP (lower than 15). Aggregate energy saving may not exceed 60 kt CO2 Average volume capacity of the project refrigerators installed is at least 80% of the average volume capacity of the existing unit. The existing residential refrigerators shall be replaced at no or low cost to the refrigerator's owner. Fluorinated gases shall be recovered and destroyed, or store for reuse. Avoidance of HFCs Emissions in Standalone Commercial Refrigeration Cabinets AMS IIIAB Activities resulting in the avoidance HFC-134a during the lifetime of the unit (covers: fugitive emissions during manufacture, usage, servicing and disposal of units). Aggregate energy saving may not exceed 60 kt CO2. Applicable to producer of commercial refrigeration cabinets charged with HFC-134a or other refrigerant with a high GWP, for at least three years. The new units proposed should used low GWP and be equally of more EE than the existing units. Source: unfccc.int 7

8 Overview of CDM Methodologies EE Measures and HFCs Reductions in the Refrigeration Sector Methodologies Summary of Applicability Conditions Manufacturing of Energy Efficient Domestic Refrigerators AM0070 Activities undertaken by manufacturers of refrigerators that increase the energy efficiency of manufactured refrigerators. Covers units sale in the host country only. Manufacturers have minimum 3 years of historic data (i.e., quantities of units manufactured and sold in the Host country and their standard electricity use and adjusted storage volume). GWP of refrigerants and foam blowing agents of the new units shall be lower than GWP of gases used by the manufacturer during the three years prior to CDM project. Manufacturing and Servicing of Domestic Refrigerators using low GWP gases AM0071 Source: unfccc.int Activities undertaken by manufacturers of refrigerators that switch from HFCs charged appliances to low GWP gases. The manufacturer has been producing units charged with HFC-134a or other refrigerant with a high GWP for at least three years and has not been using refrigerants with a low GWP prior to the start of the project activity. The refrigerant used in the new units allows for the same or a better energy efficient than prior to the start of the project activity. The project activity covers only refrigeration appliances that are manufactured (as defined above) by the manufacturer, involved in the project activity, in the Host country. Imported refrigeration appliances shall not be included in the project activity; 8

9 CDM Methodologies General Requirements for EE Activities under the CDM Destruction of existing equipment Destruction is required or leakages shall be considered (if allowed by the methodology); destruction needs to be monitored and certified. Crediting Period Limit Crediting period is limited to the remaining lifetime of the existing equipment (i.e., technical lifetime or documented practices in the host country). Capacity of the new equipment vs existing Rated output capacity of the new equipment cannot be significantly larger than the rated output capacity of the existing equipment. Limited to + 5 to 10 % depending on the methodology 9

10 SCALING-UP UNDER THE CDM FROM A PROJECT BY PROJECT APPROACH TO PROGRAMMATIC AND SIMPLIFIED APPROACHES 10

11 Demand Side EE Projects under the CDM Solvent use 0% Afforestation and reforestation 0% Agriculture 5% Fugitives (others) 1% Fugitives (fuels) 6% Metal 0% Mining/ mineral 1% Transport 0% Construction 0% Chemical industries 3% Manufacturing industries 5% Energy demand 1% Waste 18% Energy Projects 60% Source: UNFCCC, 26/02/2010

12 Scaling-up under the CDM From a Project by Project Approach to Programmatic and Simplified Approaches Individual projects grouped under a CDM Program of Activities (PoA). Using sampling groups rather than monitoring each appliances (e.g. using AMC IIC for EE chillers). Use of standardized baseline and automatic additionality (e.g. AM0070). Need to develop similar approaches for A/C

13 Conclusions Demand-side energy efficiency improvement Offers immediate opportunities under the HCFC phased-out for scaling up climate change mitigation efforts. Results in immediate cost savings. Demand side energy efficiency under the CDM: - Experiences exist at both project and program levels. - Methodologies are approved for domestic and industrial appliances (A/C, chillers, and refrigerators); - Program design and methodological choices (e.g., monitoring using sampling) are key to reduce the costs associated with CDM requirements. - CDM early consideration is essential for the demonstration of additionality & efficient design of the CDM program.

14 THANK YOU Julie Godin The World Bank Carbon Finance Unit 14

15 CDM Methodology for EE Appliances General Concepts Emission Reductions Calculations (simplified eq.) Annual Energy Saved (MJ/year) Carbon per Unit of Energy saved (tco2e/mj) X = Annual Emission Reductions (tco2e/y) = Energy consumed per unit i under the baseline e.g., national electricity grid, fossil fuel - Energy consumed per unit i under the project * number of appliance i 15