Introduction to GHG Project Quantification. Case Study #1. Mountainview District Heating Project

Transcription

1 Introduction to GHG Project Quantification Case Study #1 Mountainview District Heating Project for December 21, 2007

2 Table of Contents 1 Introduction General Requirements Project Description Project title, purpose and objectives Location of project Conditions prior to project initiation Project strategy to reduce emissions Project technologies, products, services and the expected level of activity GHG emission reductions from project Risks that may substantially affect the project s GHG emission reductions Project proponents and relevant stakeholders Summary environmental impact assessment Stakeholder Consultations Chronological Plan Identifying GHG Sources, Sinks and Reservoirs Relevant for the Project Selection and establishment of criteria and procedures Procedure for identifying SSRs Application of procedures Determining the Baseline Scenario Selection and establishment of criteria and procedures Application of the procedure and justification of baseline scenario Identifying Sources, Sinks and Reservoirs for the Baseline Scenario Criteria and procedures Application of procedures Determining the baseline electricity grid procedure Selecting Relevant GHG Sources, Sinks and Reservoirs for Monitoring or Estimation of GHG Emissions and Removals Criteria and procedures for relevance of SSRs Application of criteria and procedures Quantifying GHG Emissions for the Project General Quantification Methodology Production of DES components Manufacturing of CHP system components Transportation of CHP system to project site Commissioning of CHP system Propane production and transportation Electricity production and distribution CEP Boiler Decommissioning of CHP system Quantifying GHG Emissions from the Baseline General Quantification Methodology Propane production and transportation Steam plant and Building Heating... 35

3 8.1.3 Landfill and Beehive burner Quantifying GHG Emission Reductions Monitoring the GHG project References... 41

4 1 Introduction A substantial amount of energy is consumed in space and water heating in buildings (residential, commercial, and industrial), resulting in large amounts of greenhouse gas (GHG) emissions. In Canada alone, GHG emissions from residential energy consumption for these purposes account for over 43 mega tonnes (Mt) of emissions, and commercial and institutional energy consumption (which includes emissions from public administration i.e., federal, provincial, and municipal facilities) contributed almost 38 Mt of emissions. One way to reduce these emissions is to leverage the efficiency gains associated with the use of a district energy system, or DES. In a DES, energy is produced in a central location, generally in a highly specialised (and hence highly efficient) production process, and then is supplied to multiple buildings. This negates the need for multiple smaller, less efficient heat sources in each building. Further GHG reductions can be achieved if the DES is fuelled by renewable sources (e.g., wind, hydro, or solar) or from sources that would otherwise be considered waste (e.g., heat from the incineration of municipal solid waste, or the residual heat of an industrial process). The following case study demonstrates the GHG emission reductions achieved through the installation of a DES, fuelled by waste biomass, in a municipality. The project is located in a small municipality in the province of British Columbia, Canada. In this town, space and hot water heating is generally provided by propane delivered to the town by train. The town also has a lumber mill which generates a substantial amount of wood residue that is considered waste and is either landfilled or simply burned. By reducing propane consumption and utilising the wood residue as a resource, a DES that uses waste biomass as a fuel source can achieve a substantial reduction in GHG emissions in this context. 1 2 General Requirements The project proponent is not subscribed to any GHG policy or program(s), standards or legislations, so there are no specific program requirements to which this project must adhere. The following good practice guidance has therefore been used in the identification of GHG sources, sinks and reservoirs (SSRs); in the identification of the baseline scenario; and in the quantification of emissions and emission reductions, monitoring and reporting of the project: ISO :2006 Specification with guidance at the project level for quantification, monitoring and reporting of greenhouse gas emission reductions or removal enhancements (2006); WRI/WBCSD GHG Protocol for Projects (December 2005); Canada's Greenhouse Gas Inventory, , Environment Canada (April 2006); and 1 The term DES encompasses any system that produces energy and distributes it to multiple users, generally within a fairly geographically constrained area (i.e., within a complex of buildings, or within a single municipality or neighbourhood). DES is therefore sometimes used to describe systems that produce heat energy only, as well as systems that produce both heat and electrical energy. Systems that produce both heat and electrical energy, however, are more specifically referred to as combined heat and power (or CHP) systems. For the purposes of this case study, the term DES refers strictly to heat-only district systems.

5 Government of Canada, TEAM Program, SMART Protocols (2006) 2 The ISO :2006 standard and the WRI/WBCSD GHG Protocol for Projects (December 2005) are used as good practice guidance for identifying sources, sinks, and reservoirs (SSRs) for the project and baseline. They also served as good practice guidance for quantifying, monitoring and reporting GHG emissions and emission reductions. In identifying SSRs, a seven step procedure based on streamlined life cycle assessment (LCA) techniques, was applied. 2.1 Project Description Project title, purpose and objectives Project Title Mountainview District Energy System Project The project is being undertaken to assess and quantify the emission reductions achieved from the installation of biomass-fuelled DES that will serve several municipal and residential buildings in the town of Mountainview. The greenhouse gases to be quantified include CH4, CO2 and N2O. We wish to quantify and verify GHG emission reductions associated with producing heat energy at a central energy plant (CEP) for the Mountainview District Energy System Project. The verified emission reductions will then be sold as GHG emission reductions by the lumber mill producing the wood waste to purchasers wishing to offset their GHG emissions or meet voluntary GHG reduction targets. The company wishes to verify the GHG emission reductions on a yearly basis before the sale of the offsets to ensure the quality of the credits, thereby maximizing their value. The verification will be done in accordance with ISO : by a mutually agreed upon verification organization Location of project The project is located in the City of Mountainview, in the province of British Columbia (BC), Canada. Mountainview is a municipality of approximately 8,500 people located in central BC, in a heavily forested region of the Western Cordillera mountain ranges. The system s CEP is located on the site of the town s lumber mill, and the plant provides medium temperature hot water for space and hot water heating at the municipal aquatic centre (which includes a pool and a recreational centre), a secondary school, the municipal arena, the municipal court house, and a private residence. The CEP will also generate saturated steam to be used onsite in the lumber mill s dry kilns. The area required for the Central Energy Plant is approximately thirty by thirty meters or 1000 sq. meters (one quarter of an acre). This area provides for the plant, fuel storage, and boundary access. A single building houses the heat generation system and fuel storage system. The 2 TEAM is a Government of Canada Program. More information on the SMART can be access at the following link 3 The ISO :2006 Specification with guidance for the validation and verification of greenhouse gas assertions standard provides requirements to perform validation and verification of GHG projects

6 distribution piping system involves approximately 1,600 trench meters of pre-insulated supply and return pipes (two pipes in a trench), with four branch connections to existing buildings and one branch stub for a future building connection. There will be five Energy Transfer Stations (ETS), one at each of the buildings served by the system Conditions prior to project initiation Prior to project initiation, the buildings served by the system generated space and hot water heating through conventional propane fuelled residential or commercial heating systems. The propane was delivered to the town by train, and trucked to the buildings where it was stored in tanks. At the lumber mill (site of the CEP), steam was generated for the dry kiln through combustion of propane, which was delivered and stored as described above. The wood residues from the milling processes at the site were considered waste, with a small amount being landfilled (mostly to provide cover for the municipal landfill as required) and the majority being burned onsite in a in a silo burner (also known as a beehive burner due to its distinctive shape). Changes to Provincial environmental regulations required the phasing out of the beehive burners due to concerns over air emissions (especially particulate matter) caused by the inefficient combustion of the wood residues in the burners, which employed an open-flame process with few, if any, emissions controls. Changes to the out-dated heating plants of the arena, the secondary school, and the residence were either required immediately or in the near term, and the aquatic centre was a new construction that was designed from the outset to be heated by the DES Project strategy to reduce emissions The main way in which reductions are decreased by the project is through the displacement of propane fuel use. Propane is burned in older, less efficient heaters in each of the buildings served by the system, as well as by the mill to produce steam for the kiln. There are also upstream emissions associated with the production and delivery of propane that will be displaced by the use of the waste fuel in the immediate area in which it is produced. Emissions of carbon dioxide, along with other pollutants (especially particulate matter), will also be reduced by displacing the combustion of wood residues in the beehive burner. While the volume of wood combusted will actually increase to fuel the DES, this will be offset by the decreased volume of propane consumed for space heating and for the production of kiln steam. Another area of emissions reductions will be achieved through the reduction of landfill gas (LFG) production. When organic waste decomposes in a landfill, under anaerobic conditions, LFG is produced. This gas is composed of approximately 50% methane (CH4). This phenomenon is the principle source of GHG related to landfilling of the wood residues. Combustion of the wood residues in the highly efficient CEP avoids the production of large amounts of methane, which has a global warming potential 21 times that of CO2.

7 2.1.5 Project technologies, products, services and the expected level of activity The project will consist of the following major design components: The Central Energy Plant; The Distribution piping network (buried pipe); and The Customer building connections The biomass combustion technology used at the CEP is a proven technology used in several other applications in industry. This project is, however, the first example in the country of the application of a small scale biomass technology for a thermal heating system supplying heat to multiple community customers. The CEP has a propane back-up system that can be used to guarantee the supply of energy to customers in periods of limited wood waste fuel supply or malfunction of the feeder equipment. The forms of energy consumed by the customers are steam and hot water. It was decided to use thermal oil as an intermediary energy transport mechanism (between the biomass combustor and the steam/hot water production system). This allows hot water (for space heating) to be produced at the CEP using a heat exchanger, but allows the steam to be produced outside the CEP, in this case inside the mill where engineers certified in high pressure boiler operation are already on staff. This enables the owner of the CEP to minimize operating costs relating to plant staffing requirements, as its configuration allows the CEP to operate legally with only one engineer under the provincial Engineers Act. Heat exchangers, sized appropriately for the expected loads, are installed in each of the customer buildings GHG emission reductions from project GHG emissions for the project will be quantified starting January 1, 2006 (the first full year of project operation). The project is expected to generate emissions reductions of 6,271 tonnes CO2-equivalents for the 2006 calendar year. Subsequent years reductions will be quantified on a yearly basis Risks that may substantially affect the project s GHG emission reductions The main risks that may affect the GHG emission reductions estimated for this project include: Malfunction of the project equipment; Loss of fuel source due to mill closure (for economic reasons); and Resource depletion due to forest fire, over-harvesting, or climate/ecological changes (e.g., mountain pine beetle) Project proponents and relevant stakeholders Project Proponents

8 Mountainview Community Energy Association 2089 Reel dive Mountainview, BC, Canada City of Mountainview 2530 Mountain Street Mountainview, BC, Canada The Mountainview Community Energy Corporation (MCEC) is wholly owned by the City of Mountainview. Project Stakeholders Lumber Corporation (lumber mill and credit owner) 37 Mill Street Mountainview, BC, Canada Mr. and Mrs. Johnson (owners of the residence on the system) 15 Main Street Mountainview, BC, Canada Summary environmental impact assessment The environmental impact assessment required by the BC Environment Ministry was performed by XYZ Consultants. The study was performed to assess the impact the project will have on air, water, scenery and natural habitat. Results of the study reveal that Mountainview District Energy System Project meets all the mandatory requirements. A detailed report is provided upon request Stakeholder Consultations The City of Mountainview held a public consultation meeting with interested citizens and no objections were raised from participants. The city council then approved unanimously the decision to implement the Mountainview District Energy System Project Chronological Plan The project consists of three major stages: 1) System Construction MCEC engaged a contractor to construct the Central Energy Plant. Construction began in October 2004 and was completed on March 31, Commissioning the plant took place for May 31, 2005 and start-up happened on June 1st, Installation of the hot water distribution piping and the building connections commenced in October 2004 and was completed to the five current users in March 2005.

9 2) Project Operation & Monitoring Monitoring of the project to determine the GHG emissions reductions that are the subject of this document, as well as particulate matter and other air contaminant emissions reductions that are reported separately to fulfill regulatory requirements, began in July ) Project Expansion Expansion of the distribution system to supply new customers is expected to occur in 2007 and Potential new customers include the city s existing hospital and a new downhill ski resort being constructed just outside the town s boundary. Table 1: Project Activity Timeline Task Date Status Engineering design Complete City of Mountainview approval February 2004 Complete Installation of DES March 2005 Complete Start of Operation June 2005 On-going Design of GHG quantification documentation November 2005 Complete Review of operation and monitoring procedure and collected data Every three months from project start date On-going GHG report on yearly emission reductions Every year in February On-going Verification of emission reduction quantified in Every year in mid-march On-going GHG report Sale of GHG emission reductions to buyer Every year by March 31st On-going 3 Identifying GHG Sources, Sinks and Reservoirs Relevant for the Project 3.1 Selection and establishment of criteria and procedures In identifying the SSRs relevant for the project, streamlined life cycle assessment process based on ISO was established and applied. The procedure is a systematic approach based on the GHG quantification principles of completeness, transparency and relevance. 3.2 Procedure for identifying SSRs The following seven step procedure was applied in identifying the relevant SSRs: 1) Identify (potential) SSRs for the system that are controlled or owned by the project proponent. Focus on the primary project activities (i.e. the direct SSR or SSRs that aim to provide the main effect(s) on GHGs).

10 2) Identify (potential) SSRs that are physically related to the direct project. Trace products, materials and energy inputs/outputs upstream to origins in natural resources and downstream along life-cycle. 3) Identify (potential) SSRs that are economically affected by the project. Consider the economic and social consequences of the project (compared to the baseline), look for activities, market affects, and social changes that result from or are associated with the project activity. 4) For each identified SSR determine parameters required to estimate or measure GHGs. This includes materials and energy inputs/outputs, and information on activities, products and services for the SSR. 5) Select SSR scale by aggregating or disaggregating identified potential SSRs. The number of SSRs defined and the degree of detail required is a function of the analysis at hand. This is guided by availability of data, management of data collection, and assurance of accurate GHG quantification. As a rule of thumb, more detailed (disaggregated) SSRs are appropriate where it is known that the project system differs from the baseline system, where more specific quantification is necessary, or where data are readily available. Aggregated SSRs are sufficient where the project and baseline systems are identical. 6) Determine the function(s) (products, goods and services) provided by the system of SSRs. The whole system of SSRs may perform one or more functions, plus individual SSRs may have specific functions. 7) Confirm that all SSRs are identified; that each is classified appropriately as owned, related or affected; that all GHG inputs and outputs for each SSR are identified; and that the sequence of SSRs for the system is correct. Repeat previous steps as necessary. 3.3 Application of procedures By following the above steps, a diagram shown in Figure 1 was generated to show all the SSRs associated with the system. The SSRs that are controlled or directly owned by the project are those elements whose operations are under the direct influence of the project proponent and they are often found on the project site. The related SSRs have material or energy flows into, out of, or within the project. These SSRs are generally found upstream or downstream from the project and also include activities involved with the design, construction and decommissioning of the project. The SSRs were classified as onsite SSRs during project operation, upstream SSRs during project operation, downstream SSRs during project operation, upstream SSRs before project and downstream SSRs after project. A summary of the identified SSRs is provided in Table 2.

11 Figure 1: Relevant SSRs for the GHG Project Extraction, refining & Transportation of raw material SSR10 Manufacturing of DES Components SSR11 Transportation of DES Components SSR12 Electricity Generation and Distribution SSR3 Production and Distribution of Propane SSR4 Municipal Water Treatment and Pumping SSR5 Electricit Propane Water CEP Boiler SSR1 Building SSR2 Municipal Sewage Treatment Plant SSR9 Decommissioning of DES System SSR14 Commissioning of DES System SSR13 Diesel Tree Harvesting & Transportation SSR7 Lumber Milling SSR8 Waste Biomass Diesel Production and Distribution SSR6 Lumber Controlled SSR Input / Output

12 Table 2: Identified Relevant Project SSRs SSR Identifier SSR Name Controlled, or Affected SSR Description SSR1 CEP boiler Controlled Emissions from boilers result from the combustion of biomass SSR2 Building electrical load Controlled No direct emissions generated SSR3 SSR4 SSR5 SSR6 SSR7 Electricity production and distribution Production and transportation of propane for back-up system Municipal water pumping and treatment Diesel Production and Distribution Tree Harvesting & Transportation GHG emissions are generated from upstream electricity production and distribution. A regional emission factor representing all emissions from upstream processes for electricity generation and distribution will be applied. GHG emissions are generated from upstream propane production and transportation. A national emission factor representing all emissions from upstream processes for propane production and distribution will be applied. Emissions from energy use associated with bringing potable water to the project site GHG emissions are generated from upstream diesel production and distribution. A national emission factor representing all emissions from upstream processes for diesel production and distribution will be applied. GHG emissions are generated from energy consumption in the harvesting and transportation of trees SSR8 Lumber Milling GHG emissions are generated from energy consumption in the harvesting milling of trees to lumber SSR9 SSR10 SSR11 Municipal water treatment and pumping Extraction, refining & transportation of raw materials Manufacturing of DES Components Emissions from energy use associated with bringing potable water to the project site Includes upstream activities involved in the production of the DES a components such as the extraction and treatment of raw materials needed for these components. GHG emissions are generated during these activities The manufacturing of the DES components is energy intensive and

13 SSR12 SSR13 Transportation of DES components to project site Commissioning of DES generates GHG emissions. GHG emissions are generated during the transportation of the project components to the project site Commissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel SSR14 Decommissioning DES Decommissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel

14 4 Determining the Baseline Scenario 4.1 Selection and establishment of criteria and procedures The baseline is the most appropriate and best estimate of GHG emissions that would occur in the absence of the project. The identified relevant good practice guidance for identifying the baseline scenario is the WRI/WBCSD GHG Protocol for Projects (2005). Two approaches are specified in the GHG protocol for identifying/determining the baseline: Project specific approach, which uses a procedure and information based on the specific circumstances of the project Performance standard approach, which identifies existing or planned processes/physical units to establish a benchmark with spatial and temporal boundaries relevant to the proposed project. The selected procedure and criteria is the project specific approach. To identify potential baseline candidates using the project specific approach, the GHG protocol outlines the following steps: 1) Define the product or service provided by the project activity 2) Identify possible types of baseline candidates 3) Define and justify the geographic area and the temporal range used to identify baseline candidates 4) Define and justify any other criteria used to identify baseline candidates 5) Identify a final list of baseline candidates 6) Identify baseline candidates that are representative of common practice 4.2 Application of the procedure and justification of baseline scenario Based on the above procedure, two baseline scenarios are identified: 1) The proposed project as baseline; 2) Business as usual scenario (existing practices prior to project initiation), which, in this case, means no DES and the buildings continue to rely on propane boilers to provide space and hot water heating, as well as steam for the mill s kiln. To determine and justify the baseline scenario, the GHG protocol suggests that a comparative assessment of barriers be performed. With this method, additionality will also be demonstrated. The following barriers were identified for the barriers test: Financial Technology availability Infrastructure Data and resource availability

15 An overview of the barriers test is shown in Table 3. Table 3: Comparative Assessment of Barriers Barrier Baseline candidates Project (DES) Business as Usual Financial Higher costs are associated No barrier with the implementation of this new system Technology availability There are some technical No barrier uncertainties & risks associated with the DES Infrastructure New infrastructure is required for the DES No barrier Data & resource availability No barrier No barrier Based on the above comparative assessment of barriers, since the business as usual scenario has no or the least amount of barriers to overcome, it becomes the selected baseline scenario for the project. 5 Identifying Sources, Sinks and Reservoirs for the Baseline Scenario

16 5.1 Criteria and procedures In identifying the SSRs associated with the grid baseline, the same seven step procedure employed in identifying the SSRs for the project was applied to the baseline. 5.2 Application of procedures The same procedure as that applied for identifying GHG SSRs for the project was applied for the baseline scenario. The identified SSRs for the baseline scenario can be seen in Figure 2

17 Figure 2: Identified Relevant Baseline SSRs Extraction, refining & Transportation of raw material SSR13 Manufacturing of Landfill Components SSR14 Manufacturing of Beehive Burner Components Electricity Generation and Distribution SSR2 Electricit Municipal Sewage Treatment Plant SSR12 Transportation of Landfill Components SSR15 Transportation of Beehive Burner SSR21 Production and Distribution of Propane SSR3 Propane Building Heating Systems SSR1 Decommissioning of Building Heating Systems SSR26 Commissioning of Landfill SSR16 Commissioning of Beehive Burner SSR22 Municipal Water Treatment and Pumping SSR4 Water Decommissioning of Steam Plant SSR27 Manufacturing of Building Heating Components SSR17 Manufacturing of Steam Plant Components Transportation of Building Heating Components SSR18 Transportation of Steam Plant Components SSR24 Tree Harvesting & Transportation SSR6 Lumber Milling SSR7 Waste Biomass Landfill SSR8 Decommissioning of Landfill SSR10 Commissioning of Building Heating Systems SSR19 Commissioning of Steam Plant SSR25 Lumber Beehive Burner SSR9 Controlled Diesel Production and Distribution SSR5 Diesel Decommissioning of Beehive Burner SSR11 SSR Input / Output

18 Table 4: Identified Baseline SSRs SSR Identifier SSR1 SSR2 SSR3 SSR4 SSR5 SSR6 SSR Name Building Heating Systems Electricity production and distribution Production and transportation of propane for back-up system Municipal water pumping and treatment Diesel Production and Distribution Tree Harvesting & Transportation Controlled, or Affected SSR Description Emissions from multiple boilers in each building s heating system result from the combustion of propane GHG emissions are generated from upstream electricity production and distribution. A regional emission factor representing all emissions from upstream processes for electricity generation and distribution will be applied. GHG emissions are generated from upstream propane production and transportation. A national emission factor representing all emissions from upstream processes for propane production and distribution will be applied. Emissions from energy use associated with bringing potable water to multiple buildings GHG emissions are generated from upstream diesel production and distribution. A national emission factor representing all emissions from upstream processes for diesel production and distribution will be applied. GHG emissions are generated from energy consumption in the harvesting and transportation of trees SSR7 Lumber Milling GHG emissions are generated from energy consumption in the harvesting milling of trees to lumber SSR8 Landfill Emissions from landfill (landfill gas) are generated by the anaerobic decomposition of organic wastes in landfill SSR9 Beehive Burner Emissions from the combustion of waste biomass in an open flame silo burner SSR10 Decommissioning of Landfill Decommissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel SSR11 Decommissioning of Decommissioning activities involve the

19 Beehive Burner use of equipment that generate GHG emissions from the combustion of fuel SSR12 Municipal Sewage Treatment Plant Emissions from energy use associated with treating waste water and from biological treatment processes that generate methane SSR13 Extraction, refining & transportation of raw materials Includes upstream activities involved in the production of the DES a components such as the extraction and treatment of raw materials needed for these components. GHG emissions are generated during these activities SSR14 Manufacturing of Landfill Components The manufacturing of components is energy intensive and generates GHG emissions. SSR15 Transportation of Landfill Components to Landfill site GHG emissions are generated during the transportation of the manufactured components to the landfill site SSR16 Commissioning of Landfill Commissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel SSR17 Manufacturing of Building Heating System Components The manufacturing of components is energy intensive and generates GHG emissions. SSR18 Transportation of Building Heating System Components GHG emissions are generated during the transportation of the manufactured components to the landfill site SSR19 Commissioning of Building Heating Systems Commissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel SSR20 Manufacturing of Beehive Burner Components The manufacturing of components is energy intensive and generates GHG emissions. SSR21 Transportation of Beehive Burner Components GHG emissions are generated during the transportation of the manufactured components to the landfill site SSR222 Commissioning of Beehive Burner Commissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel SSR23 Manufacturing of Steam Plant Components The manufacturing of components is energy intensive and generates GHG emissions. SSR24 Transportation of Steam Plant GHG emissions are generated during the transportation of the manufactured

20 Components components to the landfill site SSR26 Commissioning of Steam Plant Commissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel SSR26 Decommissioning of Building Heating Systems Decommissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel SSR27 Decommissioning of Steam Plant Decommissioning activities involve the use of equipment that generate GHG emissions from the combustion of fuel 5.3 Determining the baseline electricity grid procedure The Government of Canada, TEAM Program, SMART Protocol for Grid Baselines provides guidance and requirements for selecting a procedure for quantifying the GHG emissions for a baseline scenario. Based on the procedure provided by the TEAM SMART Protocol, an emission factor representing the provincial average operating margin was selected for quantifying GHG emissions due to electricity production and distribution in the baseline.

21 6 Selecting Relevant GHG Sources, Sinks and Reservoirs for Monitoring or Estimation of GHG Emissions and Removals 6.1 Criteria and procedures for relevance of SSRs Good practice guidance for the selection of relevant GHG SSRs for monitoring or estimating is very limited. Therefore the following procedure was developed and is justified based on the GHG quantification principles specified in ISO (relevance, conservativeness). The procedure, illustrated in Figure 3, was applied to assess in sequence each identified SSR for the project and the selected baseline scenario to determine whether the GHG SSRs will be monitored or estimated. In cases where a SSR is selected for estimation rather than monitoring the rational for that decision is be justified. In addition to the procedure followed, where GHG emissions and removals from the SSRs could not monitored cost-effectively and data availability was extremely limited, certain SSRs were eliminated entirely from quantification where it could be shown that this was in keeping with the principle of conservativeness. This approach allows the quantification to be faster and cheaper without compromising the credibility of the quantification of GHG emission reductions..

22 Figure 3: Procedure for Selecting SSRs Relevant to Quantification or Estimation Is the SSR new or changed from the baseline scenario to the project? Yes No SSR is relevant to the quantification. Is data available or can the SSR be monitored costeffectively? (i.e., benefit > cost) Yes The project proponent shall quantify the GHG emissions and removals from monitored SSRs Is the SSR needed to determine the level of activity of another SSR? No SSR is not relevant to the quantification of GHG emission or removal therefore it can be excluded unless the SSR is considered high risk to the GHG assertion, in which case the project proponent shall assess the SSR for relevance during the project period. Yes No The project proponent shall estimate GHG emissions and removals from the SSRs that cannot be monitored costeffectively.

23 6.2 Application of criteria and procedures Table 5 and Table 7 list all SSRs selected for quantification for the project and baseline respectively following the procedure outlined in Figure 3. In addition to the procedure followed, certain SSRs were eliminated from quantification. The rationale for such exclusions is included in the tables. Table 5: Selection of Relevant Project SSRs for Estimation/Monitoring SSR Identifier SSR Name Monitored or Estimated Justification for Monitoring or Exclusion SSR1 CEP boiler Monitored n/a SSR2 Building electrical load Monitored n/a SSR3 Electricity production and distribution Estimated Estimated based on electricity consumption (which is monitored) and an emission factor SSR4 SSR5 SSR6 SSR7 Production and transportation of propane for back-up system Municipal water pumping and treatment Diesel Production and Distribution Tree Harvesting & Transportation Estimated Estimated based on propane consumption (which is monitored) and an emission factor Does not change from baseline to project Does not change from baseline to project Does not change from baseline to project SSR8 Lumber Milling Does not change from baseline to project SSR9 SSR10 Municipal sewage treatment plant Extraction, refining & transportation of raw materials Estimated SSR11 Manufacturing of DES Estimated Components SSR12 Transportation of DES Estimated components to project site SSR13 Commissioning of DES Estimated SSR14 Decommissioning DES Estimated Table 6: Selection of Relevant Baseline SSRs for Estimation/Monitoring SSR Identifier SSR Name Monitored or Estimated Does not change from baseline to project Cannot be monitored cost effectively, however will be estimated using a conservative estimate of the GHG emissions intensity and amount of material needed will be based on professional engineering judgment Justification for Monitoring or Exclusion SSR1 Building Heating Systems Cannot be monitored cost effectively. Since this is a baseline

24 SSR Identifier SSR2 SSR3 SSR4 SSR5 SSR6 SSR Name Electricity production and distribution Production and transportation of propane Municipal water pumping and treatment Diesel Production and Distribution Tree Harvesting & Transportation Monitored or Estimated Estimated Justification for Monitoring or Exclusion SSR, excluding it from quantification is in line with the conservativeness principle. Therefore, this SSR is excluded from quantification. No historical electricity use data exists for electricity use by the propane-fired space and water heating systems of the customer buildings (though it is likely not substantial). Since this is a baseline SSR, excluding it from quantification is in line with the conservativeness principle. Therefore, this SSR is excluded from quantification. Estimated based on historical propane consumption and emission factor Does not change from baseline to project Does not change from baseline to project Does not change from baseline to project SSR7 Lumber Milling Does not change from baseline to project SSR8 Landfill Estimated Will be estimated based on historical data and monitored project data SSR9 Beehive Burner Estimated Will be estimated based on historical data and monitored project data SSR10 SSR11 Decommissioning of Landfill Decommissioning of Beehive Burner Cannot be monitored cost effectively. Since these are baseline SSR s, excluding them from quantification is in line with the conservativeness principle. Therefore, these SSR s are eliminated from the quantification.

25 SSR Identifier SSR Name Monitored or Estimated Justification for Monitoring or Exclusion SSR12 Municipal Sewage Treatment Plant Does not change from baseline to project SSR13 Extraction, refining & transportation of raw materials SSR14 Manufacturing of Landfill Components SSR15 Transportation of Landfill Components to Landfill site SSR16 Commissioning of Landfill SSR17 Manufacturing of Building Heating System Components SSR18 SSR19 SSR20 SSR21 SSR222 SSR23 SSR24 SSR26 SSR26 Transportation of Building Heating System Components Commissioning of Building Heating Systems Manufacturing of Beehive Burner Components Transportation of Beehive Burner Components Commissioning of Beehive Burner Manufacturing of Steam Plant Components Transportation of Steam Plant Components Commissioning of Steam Plant Decommissioning of Building Heating Systems Cannot be monitored cost effectively. Since these are baseline SSR s, excluding them from quantification is in line with the conservativeness principle. Therefore, these SSR s are eliminated from the quantification. SSR27 Decommissioning of Steam Plant

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27 7 Quantifying GHG Emissions for the Project 7.1 General Quantification Methodology The general method applied for estimating GHG emissions from identified sources involved taking the product between an emission factor for specific activities associated with the GHG emitting source and an activity level associated with the GHG emitting source: E i = ALxEF i Equation 1 Where: E i =Emissions of greenhouse gas i (CO 2, CH 4 and N 2 O) AL = Activity level associated with SSR (e.g., kwh of electricity, hours of operation) EF i = Emission factor for the specific activity associated with the SSR (e.g., x tonnes CO 2 e/kwh electricity consumed). Activity levels were either directly measured (e.g., kwh electricity consumed) or estimated based on professional engineering judgment (e.g., tonnes of steel used to construct the CEP). The emission factors utilized in the calculations were derived or obtained from well recognized published sources (e.g., Environment Canada). Emissions were calculated for each greenhouse gas emitted and a total CO 2 e amount was estimated by taking the sum of the individual greenhouse gas emissions and their global warming potentials: E = E xgwp CO2 e i i Equation 2 Where: ECO 2 e = Total CO 2 e emissions GWP i = Global warming potential of greenhouse gas i presented in Table 6 Table 7: Global Warming Potentials (GWPs) Types of GHG Emissions GWP CO 2 1 CH 4 21 N 2 O 310

28 7.1.1 Production of DES components To estimate emissions generated from the extraction and treatment of the raw materials needed for the DES, the type and quantity of all materials was required. Since data on the quantity of materials was not readily available, estimation of the amount of each material was based on professional engineering judgment. GHG emissions from upstream production operations were estimated by: E = EFi M production of DES i Equation 3 Where EF i is the emission factor associated with the production of material i (steel, copper, rubber, etc.) and M i is the amount of material i used to construct the DES. Emission factors and estimated activity levels are presented in Table 8. Those emissions are calculated separately. Table 8: Material production emission factors Material Activity level (t material) Emission factor (t CO 2 e/t material) Steel Aluminum Plastics Sample Calculation: From Table 8, the E-Solutions DES requires 7.2 tonnes of steel, 0.06 tonnes aluminum and 0.05 tonnes plastic. Using the emission factors presented in Table 8 and Equation 3: E production of DES t CO2e t plastic t CO2e = t steel t plastic t steel t t CO2e 0.06 alu minium t alu minium E production of DES = 23.9t CO e 2 Since the project has an expected life span of 30 years, production emissions will be prorated over that period by dividing total emissions by thirty at the emissions reductions calculation stage Manufacturing of CHP system components

29 Emissions from the manufacturing of the DES are calculated based on the value of the DES and an emission factor for the manufacturing sector. The value of the DES is documented in purchase order forms and the emission factor is referenced from CIEEDAC 4. For the Mountainview DES, its value is $300,000 CAD and the emission factor is t CO 2 e/$. Sample Calculation based on Equation 1 E E manufacturing of DES manufacturing of DES t CO2e = $300,000 $ = t CO e 2 Since the project has an expected life span of 30 years, manufacturing emissions will be prorated over that period by dividing total emissions by thirty at the emissions reductions calculation stage Transportation of CHP system to project site The required activity level for estimating transportation emissions is the total distance traveled to the project site and the weight of the CHP system components. The emission factor used for calculating emissions is the 100 g/tonne.km quoted in the Transportation Options Paper (1999, Government of Canada). Sample Calculation based on Equation 1 and the mass of DES system equal to 7.3 tonnes E E Transportation Transportation = 7.3tonnes 800km 100 = 0.58tonnes g tonne km Since the project has an expected life span of 30 years, transportation emissions will be prorated over that period by dividing total emissions by thirty at the emissions reductions calculation stage Commissioning of CHP system To estimate GHG emissions from commissioning of the CHP system, data on the total mass of concrete delivered to the project site, the steel works and the mechanical/electrical engineering works are required. This information can be obtained from receipts for materials delivered for the site and through manufacturers specifications. The general formula used to equate GHG emissions from commissioning activities is: 4

30 E commissioning DES System = Platform / structure EFi Mechanical / Electrical Engineering Works M + EF M Emission factors are referenced from LCA published data and industry associations. Activity levels and emission factors are presented in Table 9 and Table 10 below. i i i Table 9: Activity Levels and GHG Emission Factors from Civil Engineering Work Civil Engineering Works Quantity of concrete t material 61.2 Emission per unit of concrete t CO 2 /t 0.5 Emissions t CO Quantity of steel t material 1 Emission per unit of steel t CO 2 /t 3.2 Emissions t CO Table 10: Activity Levels and GHG Emission Factors from Mechanical and Electrical Engineering Work Mechanical and Electrical Engineering Works Quantity of steel t material 1 Emission per unit of steel t CO 2 /t 3.2 Emissions t CO Quantity of copper t material 0.5 Emission per unit of copper t CO 2 /t 7.45 Emissions t CO Quantity of aluminum t material 0.1 Emission per unit of aluminum t CO 2 /t 12.7 Emissions t CO Quantity of plastics t material 0.05 Emission per unit of plastic t CO 2 /t 1.93 Emissions t CO Since the project has an expected life span of 30 years, commissioning emissions will be prorated over that period by dividing total emissions by thirty at the emissions reductions calculation stage Propane production and transportation Activity levels for the upstream propane production and transportation are litres of propane consumed by the DES in the project. The emission factor obtained from Environment Canada s

31 GHG Verification Centre is t CO 2 e/1000 L. The monthly activity levels (L propane consumed) for the DES are presented in Table 11. Table 11: Back-up Propane consumption (L) at the CEP (2006) Month Fuel flow consumed at CEP January 0 February 0 March 0 April 0 May 105 June 0 July 0 August 0 September 0 October 0 November 0 December 0 Total 105 Note that propane is only a back-up fuel for the project. The only propane consumed during the year corresponds to one eight day inability to burn wood waste in the CEP boiler due to a malfunction of the feeder auger in May. From Table 11, the total propane consumed by the boiler and CHP system in the year is 105 litres. Therefore from based on Equation 1 the GHG emissions associated with this SSR are: Sample Calculation E E E Pr opane cons& transp Pr opane cons& transp Pr opane cons& transp kgco2e = 105L m = kgCO e = 0.165tCO e Electricity production and distribution

32 The 2005 BC provincial average electricity emissions intensity of kg CO 2 e/kwh was utilized in the calculation of GHG emissions from electricity production and distribution. The energy use of the DES is monitored by one meter at the CEP, so the consumption of the various loads within the system (lighting/outlets, office air conditioning, pumps, etc.) would require estimation. However, given that all the loads on the meter are required to run the system, this aggregate value is acceptable. The monthly activity levels (kwh electricity consumed) for the DES are presented in Table 12. Table 12: Electricity consumption (kwh) at the CEP (2006) Month Electricity consumption of DES January 142 February 138 March 125 April 110 May 103 June 109 July 107 August 114 September 126 October 133 November 139 December 140 Total 1,486 Sample Calculation From Table 12, the total electricity consumed by the DES in the year is 1486 kwh. Therefore based on Equation 1 the following calculations can is performed: kgco2e E = 1486kWh Electricity prod& dist kwh E = 39.63kgCO e E Electricity prod & dist Electricity prod & dist = 0.040tCO e CEP Boiler Activity levels for the CEP boiler are the monthly volumes of biomass waste combusted in the burner. The emission factor utilised is 925 kg CO 2 e/t fuel combusted. This emission factor is

33 based on the manufacturer s performance claim for the technology, which was independently verified by a third party. The monthly activity levels (tonnes of biomass consumed) for the DES are presented in Table 13 Table 13: Tonnes of biomass consumed at the CEP Month Tonnes of Biomass Consumed January 650 February 640 March 585 April 555 May 530 June 490 July 455 August 440 September 450 October 500 November 560 December 620 Total 6,475 Sample Calculation From Table 13, the total biomass consumed by the DES in the year is 6,475 tonnes. Therefore based on Equation 1 the GHG emissions are calculated as follows: E E E CEP boiler CEP boiler CEP boiler kgco2e = 6475t 925 t = kgCO e = tCO e 2 2 In addition to the emissions from the combustion of biomass, the CEP boiler emitted GHG due to the consumption of propane back up fuel. The activity level for this is the total propane consumed from Table 11 (105 litres), and the emission factor obtained from Environment Canada is 1534 g CO 2 e/l. The GHG emissions are calculated following equation 1.

34 7.1.8 Decommissioning of CHP system Due to lack of reliable data on the decommissioning of the DES, an estimate was made by assuming that GHG emissions from decommissioning activities will be equal to the GHG emissions from commissioning of the CHP system. 8 Quantifying GHG Emissions from the Baseline 8.1 General Quantification Methodology The same quantification approach will be followed as previously outlined in the quantification of the GHG emission from the project Propane production and transportation GHG emissions from the production and transportation of propane in the baseline can be calculated using an activity level equal to the sum of propane consumption for the steam plant and for heating the building. The activity level (L of propane consumed) for one year are presented in Table 14. Table 14: Litres of propane consumed by boiler in the baseline Month Propane Consumed January 503 February 490 March 481 April 475 May 455 June 441 July 435 August 413 September 424 October 424 November 473 December 492 Total 5,507 Sample Calculation The total propane consumed in the baseline scenario amounts to 5,507 L. The emission factor for propane production and transport is t CO 2 e/1000l. Therefore, based on Equation 1: