FOR CONSULTATION MEMBERSHIP INFORMATION BOOKLET Classifications, fees, benefits and work program planning consultation process JUNE 2013
INTRODUCTION In 2012, the Global Carbon Capture and Storage (CCS) Institute conducted an extensive program of consultation to gauge Members views on its draft Five Year Strategic Plan. Taking into account Members feedback, the Five Year Strategic Plan was fi nalised and released to all Members in March 2013, laying the foundation for the Institute s future direction. This document outlines the Institute s proposed approach to classifications and fees under the Institute s new business model. It also presents a consultative framework to ensure that priorities and activities support our objectives and Member needs. This document should be read in conjunction with the Five Year Strategic Plan. Members feedback is welcome. Constitution amendments required to effect the transition to the new business model will be put forward for Member approval at the October 2013 Annual General Meeting. 1
PROPOSED CLASSIFICATIONS AND FEES Over the past six months, the Institute has developed a proposed approach to transition from an Australian Government funded organisation to one that is primarily funded through Membership fees. In developing our proposal, we have examined the arrangements of other international Membership based organisations and consulted a sample of our Members. Our proposed approach takes account of the nature and scale of an organisation. Membership fee levels have been designed to be as fair and equitable as possible in order to allow the Institute to maintain a diverse base of participating organisations. Two classifi cations are proposed: Members and Associates. Eligibility All existing Members have the right to become a fee-paying Member or, subject to meeting the eligibility criteria, an Associate, or to decline to continue with the Institute and have their Membership cancelled. Members will have a number of different fee levels. All Members will have the same Membership rights and will also receive the full set of other benefi ts of Membership of the Institute. The proposed fee levels will be: Government: fees will be based on measures that take into consideration contribution to carbon dioxide (CO 2 ) emissions and ability to undertake actions to support a low carbon future, unless they are a state/provincial government who pay a fl at fee Industry: fees will be on a sliding scale based on annual revenue General: this is reserved for organisations eligible to be an Associate but who choose to remain a Member and receive the full rights and other benefi ts of a Member. The fee will be equal to the lowest level proposed for an Industry Member. Organisations that are eligible to be Associates include academic institutions, non-government organisations, scientifi c bodies, industry associations and multilateral organisations. Associates will incur a small charge. Associates will not be Members and will not have the full set of other benefi ts afforded to Members. 2
MEMBERS Proposed fee level national governments Membership fees will be determined based on a calculation that takes into account a country s Gross Domestic Product (GDP) per capita and annual CO 2 emissions. Initially, countries will be placed into bands based on two measures: GDP per capita and CO 2 emissions. There will be four bands for each measure. BAND GDP PER CAPITA (US$ CURRENT PRICES) BAND CO 2 EMISSIONS (MILLION TONNES A YEAR) 1 > 20,000 2 10,000 20,000 3 5,000 10,000 4 < 5,000 1 > 500 2 250 500 3 100 250 4 < 100 A country s band numbers for these measures will then be multiplied. For example, a country that is in Band 1 for GDP per capita and Band 4 for CO 2 emissions (1 x 4) will result in a band multiplication outcome of 4. This formula allows for nine possible outcomes (1, 2, 3, 4, 6, 8, 9, 12 and 16), which we have defi ned into a fi nal fee structure comprising five levels. The proposed fee levels are described below. FEE LEVEL FULL FEE PER YEAR (AU$) BAND MULTIPLICATION OUTCOME DESCRIPTION 1 1,000,000 1 2 750,000 2 3 500,000 3 or 4 Countries in the highest band for both emissions and GDP per capita Countries in the highest band for either emissions or GDP per capita and no lower than Band 2 for either emissions or GDP per capita Countries in either high emission and lower GDP per capita bands or vice versa 4 100,000 6, 8, 9 or 12 Generally non-oecd countries 5 50,000 16 Countries in the lowest band for both emissions and GDP per capita 3
The determination of the band multiplication outcome will be based on the following data points: US$ current price GDP per capita: average of the results for the three years 2010 12, annual estimates as calculated by the International Monetary Fund (IMF) as at end June 2013. annual CO 2 emissions: average of the results for the latest three years of annual national emissions estimates as calculated by the Carbon Dioxide Information Analysis Center (CDIAC) of the US Department of Energy as at end June 2013. National governments will have the ability to make fee payments through third-parties such as a state enterprise or similar agency. The fee calculation will remain consistent with the formula described on page 3 and Member rights will remain with the government. Proposed fee level state/provincial governments The fee will be AU$100,000 per year. Proposed fee level industry Membership fees will comprise four levels. A company s fee level will be determined by the three year average of its most recently audited and publicly reported consolidated global revenue. The proposed fee levels are described below. FEE LEVEL REVENUE RANGE (US$ BILLION) FULL FEE PER YEAR (AU$) 1 > 50 100,000 2 10 50 50,000 3 1 10 30,000 4 0 1 15,000 Proposed fee level general This is reserved for organisations eligible to be an Associate (see page 2) but who choose to remain as a Member and receive the rights of Membership and have the full set of other benefi ts provided to Members. The fee will be equal to the lowest level proposed for an Industry Member of AU$15,000 a year. Timing of fee payments The Institute proposes introducing Membership fees in 2015 at a discounted rate, reaching full fee levels in the fourth year: in 2015, the Membership fee will be 25 per cent of the full fee level in 2016, the Membership fee will be 50 per cent of the full fee level in 2017, the Membership fee will be 75 per cent of the full fee level in 2018, the full Membership fee will apply. 4
Membership fees will be invoiced on 1 January of each year for payment within one calendar month. The Membership fee will be an annual payment that is to be paid in one instalment. Currency for payment of fees Membership fees may be paid in one of three currencies Australian dollar, United States dollar and Euro. Fees will be determined in Australian dollars and converted to their United States dollar and Euro equivalents using the spot rates on the date fees are set anticipated to be September 2013. This (one-time) conversion rate will apply for the four year period from 2015 18, except in the event that circumstances require an earlier review. Membership fee review period There will be no changes to the key elements upon which Membership fee levels are determined during the four year period from 2015 18, except in the event that circumstances require a review of currency of payment for fees. A review of Membership fees in 2017 will include: key data points that underpin the calculation of fees, such as national income levels, annual CO 2 emissions, corporate revenues and exchange rates for currency conversion. Fees will be updated accordingly and Members advised of any amendments, which will take effect on 1 January 2019 the absolute level of fees, including allowance to increase fees annually in line with infl ation. Any amendments will take effect on 1 January 2019 the effi ciency of fee payment in three currencies, including a one-time conversion rate process. Any resulting amendments will take effect on 1 January 2019. Earlier review and amendment may be undertaken where required by circumstances. The review will be undertaken in consultation with Members. Grants to support specific work may supplement fees Membership fees are to be the primary funding source of the Institute to support an interlocking set of core activities. The Institute may also accept a grant/s where a Member or group of Members wishes to fund specifi c work. ASSOCIATES Associates may include academic institutions, scientifi c bodies, non-government organisations, industry or trade associations and not-for-profi t and multilateral organisations that have elected to not become (fee-paying) Members but wish to remain associated with the Institute. Associates will be required to pay an annual charge of AU$2,000. They will not be Members and will not have the full set of other benefi ts afforded to Members. The fee arrangements timing of payment, currency of payment, etc will be the same as for Members. 5
TRANSITION ARRANGEMENTS SUMMARY STEP 1 The Institute issues notice to all Members in June 2014 asking them to continue with the Institute as a (fee-paying) Member. In issuing the notice, the Institute will indicate, for fee-paying purposes, the relevant fee level for that Member. STEP 2 Members advise the Institute in writing by no later than 31 October 2014 if they will continue with the Institute as a (fee-paying) Member. Invoices will be issued on 1 January 2015 to those organisations that elect to continue with the Institute as a (fee-paying) Member. STEP 3 Members who decline the invitation to become a (fee-paying) Member will have the opportunity to become an Associate, subject to meeting the eligibility criteria. Invoices will be issued on 1 January 2015 to those organisations that elect to become an Associate. STEP 4 Members who decline the invitation to continue as either a (fee-paying) Member or an Associate will be reviewed by the Board and may have their Membership terminated on 31 December 2014. STEP 5 Members who fail to respond by 31 October 2014 will be reviewed by the Board and may have their Membership suspended with a view to finalising their Membership status by 30 June 2015. Members who have not accepted the invitation to continue as (fee-paying) Members by 30 June 2015 will have their Membership terminated with effect from that date. 6
ANNUAL WORK PROGRAM PLANNING CYCLE PROPOSED CONSULTATION FRAMEWORK Member participation in setting the Institute s direction and priorities is a key part of our strategy. We will therefore establish an inclusive consultation framework as part of the annual work program planning cycle. The framework will recognise the challenges imposed by the Institute s global reach, including large distances, different languages, business cultures, time zones and diversity in the demonstration of, and issues that have an impact on, CCS. The framework focuses on Member participation and contribution. The Institute recognises that Associates also make a valuable contribution to the progress of CCS. With respect to the work planning prioritisation process, the Institute will consult Members about the best way for Associates to participate in this process. Key principles in the proposed consultative framework will: recognise needs issues, challenges and opportunities will vary within and across regions; fl exibility in handling such diversity is an important part of the work planning process encourage inclusivity contributions from all Members are important and will be encouraged through mechanisms that best suit the geographical or business dynamics of a particular Membership grouping operate effi ciently particularly where formal meeting structures are employed, opportunities will be sought to work within existing meetings and processes emphasise transparency given our diverse Membership, there may be diverging views on priorities and how to achieve them. The communication of Member priorities and how such input has been compiled into overall direction and specifi c activities will be an open and transparent process involve Members Members will be extensively consulted in the development and operation of specifi c aspects, including evaluations of responsiveness to Member needs and changing priorities. Drawing on comparisons with similar organisations, we propose a fi ve stage Member consultation approach. The annual planning cycle will become formally operational in the year beginning 1 July 2014 (an example timeline by stage is shown over page). The specifi c details associated with the implementation of this conceptual framework, including the role of Associates, will be developed in close consultation with Members in each region. First, it is important that Members provide feedback on the overarching framework and specifi c aspects highlighted herein (and in the proposed Charter at Appendix A). This consultation process is specifi cally designed to gain Member input/feedback in relation to the development of the Institute s annual work program. We recognise that, over time, other forms of engagement with Members may arise (e.g. to support the Institute to implement the work program). Processes for these other forms of engagement will be developed as the need arises. 7
TIMELINE BY STAGE STAGE Work program idea generation STAGE 1 2 Idea filtering and prioritisation JULY NOVEMBER 2014 JANUARY FEBRUARY 2015 Regional focus Members to provide input through various channels: day-to-day Member engagement individual Member meetings or meetings of Members focusing specifically on work program planning written submissions. Input from Member working groups these groups may be national, regional or global in nature and have a specific area of focus (e.g. public engagement). Input may be provided on national, regional and global areas of concern or opportunity. The Institute will prepare briefing materials on key outcomes to support discussion at the next stage of the process idea filtering and prioritisation. Continued regional focus. Members to help prioritise key pieces of work (and provide input into their scope) through a variety of channels, including: individual Member meetings written submissions Member Advisory Groups. Member Advisory Groups may take many forms and operate in different ways: Member Advisory Groups may be fully regional in nature or structured around specific geographical areas within a region options for how Member Advisory Groups conduct their business include physical meetings, teleconferences and email a draft Member Advisory Group Charter is attached. The Institute will work closely with Members to define which mechanism best suits participation at this stage of the process. The summary notes from various meetings and events undertaken will feed into the next stage of the process compilation of the draft work program. A brief half year activity progress report measuring performance against the current year s annual work program may also inform discussion. 8
STAGE STAGE STAGE 3 4 5 Compilation of the draft work program Feedback and refinement Institute Board approval FEBRUARY APRIL 2015 APRIL MAY 2015 JUNE 2015 The Institute will prepare a draft global work program, taking into account the outcomes arising from the annual Institute Board strategic workshop held in February and the regional prioritisation process. Key elements in the preparation of the draft work program include: cross-fertilisation of ideas and priorities from all regions allocation of resources to activities. To support the next stage of the process feedback and refinement Members will be provided both the draft Institute work program and briefing materials explaining the rationale by which the Institute arrived at a global view of relative priorities and resource allocation needs. All Members will be given the opportunity to review the draft work program prior to submission to the Institute Board for approval. Channels available for review are as described in Stage 2. Members may provide feedback on the complete draft work program. The feedback period will be one month. The Institute will examine the feedback, with particular emphasis on identifying common themes or messages, and refine the work program appropriately prior to the last stage of the process Institute Board approval. The Institute Board will review the final annual work program following receipt of Member feedback, and approve such (or direct changes pursuant to approval). The final Board approved annual work program will be forwarded to Members for information. (Note: A full year report measuring performance against the just completed work program will be produced after June. This will be provided to Members and may support discussion as the next year s process starts.) 9
BENEFITS Strategic benefits to Members In championing CCS as a vital component of a portfolio of low carbon technologies, we provide strategic benefi ts to fee-paying Members in the following areas: STRONG, INDEPENDENT AND INFLUENTIAL REPRESENTATION The Institute is a strong, independent and infl uential global voice advocating the advantages of, and need for, CCS as a central climate change mitigation technology. Through the leveraging power of a collective organisation we can raise the political and institutional readiness and public profi le of CCS and exercise infl uence at key climate change and energy security forums. KEY BENEFITS: Members can work through, and have reference to, an independent global advocate for the importance of CCS Member access to key policy and decision makers brokered through the Institute. UNIQUE CONVENING POWER Using our global networks, we bring together Members, experts and key stakeholders to share knowledge about real life experiences of CCS and explore enabling opportunities to accelerate its use. KEY BENEFITS: Member access to networks of information and expertise Members are able to make better informed decisions and cost savings through access to the most up-to-date information on CCS. CCS EXPERTISE, KNOWLEDGE AND INITIATIVES Our authoritative publications on the global status of CCS, comprehensive project database and collaborative efforts with others on various toolkits, best practice guidelines and capacity development programs, make the Institute a leading source of CCS expertise. KEY BENEFITS: Members are able to make better informed decisions and cost savings Members can access opportunities for capacity development and potential CCS/ CCUS markets. The Institute s recently released Five Year Strategic Plan shows how the Institute is uniquely positioned to successfully champion the development, demonstration and deployment of CCS and the strategic benefi ts fl owing to Members as a result. 10
General benefits The package of rights and other benefi ts available to Members and Associates in their interactions with the Institute is summarised below. Associates have an important contribution to make consistent with their specifi c area of expertise and will have the opportunity to participate in Institute activities. However, they will not be entitled to the full benefi ts of Members, such as voting rights. Summary of rights and benefits by classification BENEFIT MEMBERS ASSOCIATES Voting rights Contribution to setting Institute direction and work priorities By invitation (Members consulted) Invitations to sit on working groups and task forces As relevant (Members consulted) Free attendance at Institute events that may attract charges By invitation Acknowledgement and recognition as a key supporter of CCS technologies Showcasing of CCS activities on merit through the Institute s website Invitations to provide keynote addresses Invitations to VIP events (other than speaking) By invitation Involvement in supporting Institute representations at international energy and climate change forums By invitation Participation in and/or invitation to high-level Institute events, policy dialogues and/or forums (other than speaking) By invitation Personalised briefings by Institute staff Membership liaison service As required to achieve mutual goals Access to Institute newsletters, communications, etc 11
APPENDIX A DRAFT MEMBER ADVISORY GROUP CHARTER The purpose of a Member Advisory Group is to provide input to the Institute s annual work program planning cycle at the Idea fi ltering and prioritisation and Feedback and refinement stages. It is intended that a Member Advisory Group will: review potential work program activity submissions from Institute Members within a region identify activities that fi t within the parameters set by the Institute s Five Year Strategic Plan and associated key strategies and supporting initiatives identify and combine closely aligned submissions, where applicable focus on understanding relative positioning of activities and emphases (i.e. get a sense of things strategically) and not on developing a rigid set of ranked work programs consider and provide advice on issues relating to the practical implementation of work program initiatives within a jurisdiction, including the potential cost implications of submissions, where relevant consider related key performance indicators as well as monitoring and evaluation methods of proposed activities consider and provide advice on potential collaborative opportunities to deliver work program activities review and provide feedback on the Institute s draft annual consolidated global work program follow normal meeting protocols, including prior circulation of agenda and briefi ng materials to be discussed, with key discussion points summarised be open to all Members wishing to contribute be open to Associate representatives where such inclusion is supported by the Chair. The Institute will provide the Chair for a Member Advisory Group. A Member Advisory Group has no formal decision rights in regard to approval of the Institute s annual work program other than as described in this (draft) Charter. 12
REQUEST FOR FEEDBACK Members are invited to provide feedback on the information outlined in this document. Written submissions, including general or specifi c questions and other feedback, are welcome and should be emailed to strategy@globalccsinstitute.com by 23 August 2013. Feedback may also be provided direct to Institute General Managers: NAME EMAIL PHONE NUMBER Victor Der General Manager The Americas victor.der@globalccsinstitute.com +1 240 848 0810 Barry Jones General Manager Asia Pacific barry.jones@globalccsinstitute.com +61 418 625 137 John Scowcroft General Manager Europe, Middle East and Africa john.scowcroft@globalccsinstitute.com +33 667 797 291 Stewart McGlashan General Manager Business Strategy stewart.mcglashan@globalccsinstitute.com +61 416 149 238
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