A practical overview from planning to practice on the destruction of methane generated from manure in piggeries.

Source: Clean Energy Regulator (CER) July 2013

Purpose

• support your

participation

• help you to understand

what’s involved

Introduction

• Increase awareness of Clean Energy Regulator’s role• Understand key concepts behind Carbon Farming

Initiative’s operation

Clean Energy Regulator

Our vision is to support Australia in transitioning to a low carbon economy through an informed and efficient market for carbon and investment in renewable energy.

Three government organisations have a role in the Carbon Farming Initiative Department of

Industry:Development of policy, legislation

and methodologies

Clean Energy Regulator:Assessment of projects,

education, issue of Australian carbon credit

units

Department of Agriculture,

Fisheries and Forestry: Provides information and

support for landholders and funds research

Australian Government response to Climate Change

• International: Kyoto Agreement

• Domestic: Reduction in greenhouse gas pollution using the market

» Carbon pricing

mechanism

How the Carbon Farming Initiative works

• You can earn Australian carbon credit units (ACCUs) by: » storing carbon, or

» reducing greenhouse gas emissions on the land

• 1 ACCU = 1 tonne of carbon dioxide equivalent (CO2-

e)

Methodology determinations

Set out the rules for undertaking a specific

activity to earn Australian carbon

credit units

Guide to undertaking a piggeries – destruction of methane generated from

manure project

• Support your decision to participate in the Carbon Farming Initiative, using the piggeries methodology

What does a piggery project look like?

• Manure treated in a covered pond

• Pond contains only manure from operations of piggery sheds

• Gas from the covered pond is collected and combusted:

» Flare

» Electricity generation system

» Gas boiler

• Use PigBal model to calculate carbon abatement.

How do I get started?

• Check your eligibility

• Assess the feasibility

• Check your expectation for return on investment

• Decide on your business model

• Apply:

» Recognised Offsets Entity

» ANREU account

» Eligible Offsets project

How do I undertake a piggery project?

• Meet eligibility requirements

» Flare» Electricity generation» Gas boiler

• Maintain your equipment

• Measure inputs to PigBal

PigBal Model is a computer program that predicts piggery manure

production. Model inputs include daily herd information, weekly.

Project boundary

• Baseline:

» Greenhouse gas emissions from treatment pond (methane - CH4)

• Project activity:

» Electricity from the grid, fuel used for gas capture and combustion (CO2, N20, CH4)

» Gas capture and combustion (N20, CH4)

Measure and calculate abatement

• Baseline calculation

• Greenhouse gas abatement calculation

• Monitor

• Use PigBal

Monitoring and record keeping • Project information

• Combustion device information

• Monitoring and gas composition information

• Direct and indirect measurement (inputs and outputs from PigBal)

• Other records

Quality assurance and control matters

More on record keeping

Monitoring data is crucial to your application for ACCUs. Will you be able to protect your data in an unforseen event?

Audit report

Provides a ‘reasonable assurance’ opinion on whether or not your project complies with the methodology determination and Carbon Farming legislation.

Apply for carbon credits

• Submit offsets report and audit report to the Clean Energy Regulator

• Australian carbon credit units (ACCUs) are issued into your account in the Registry

• Earn money by selling the ACCUs and transferring them to another account in the Registry

Administration: working with the Clean Energy Regulator

• Understand three key administrative steps involved with Carbon Farming Initiative projects.

Three important parts to your Carbon Farming Initiative administration

1. Recognised Offsets Entity

2. Eligible Offsets Project

3. Certificate of Entitlement

Download application forms from the Clean Energy Regulator web site.

There are no application fees.

Recognised Offsets Entity

•Essential to be part of the

Carbon Farming Initiative

and issued with Australian

carbon credit units

•Open an ANREU Account

» fit and proper person test

» proof of identity test

•Centrally processed, case

officer allocated

Tip: call us before you submit

your application to make

sure it’s all in order:

(02) 6159 3434

Eligible Offsets Project

• Sets out your plan to implement a Carbon Farming Project.

• Checked by the Clean Energy Regulator to make sure your plans meet the Carbon Farming Initiative rules.

• Processed by Carbon Farming team, new case officer.

Eligible Offsets Projects:

Q10: Project start date

If backdating, confirm project operating with project requirements the whole time period

Eligible Offsets Projects:

Q12: Project description

Address all project eligibility points identified in s2.1 of the methodology determination

Eligible Offsets Projects:

Q25: Legal right

• Land title

• Licence

• Contracts

Certificate of Entitlement and offsets report

• Applications for Australian carbon credit units are made at the same time as you submit your offsets and audit reports.

• You can choose when to report and apply for credits, within the one to five year period.

• Good record keeping is essential to your report and audit.

Summary: three important parts to your administration

1. Recognised Offsets Entity

2. Eligible Offsets Project

3. Certificate of Entitlement

Carbon Markets and feasibility

• Understand the basics of ACCU markets to enable you to ask questions of your advisors

• Provide you with tips to consider when undertaking your feasibility

Types of markets

• ACCUs are personal property and can be traded.

• Two key markets:

• Domestic compliance market

• Voluntary market

Selling ACCUs• Compliance market - pay attention

to:

» Carbon pricing mechanism in

fixed price period (to 2015)

» Market for European Union

Allowances (after 2015)

• Voluntary market – pay attention to:

» Charisma of your project

Who can help?

• Seek advice from an Australian Financial Services Licence holder

• Consider these resources:

» Your normal bank and/or broker

» Carbon Markets Institute: CFI hub

» Liable Entities Public Information Database (LEPID)

Project feasibility 1. Financial feasibility

• Know the costs and benefits

• Cash flow

• Scenario analysis

2. Commercial feasibility

• Kyoto or Non-Kyoto ACCUs?

• Number ACCUs estimated?

• Timeline to deliver ACCUs?

Project feasibility 3. Methodology

• Can you meet the rules for eligibility and data capture as described in an approved methodology determination?

4. Regulatory Feasibility

• Methodology available?

• In Australia?

• Required by law?

• Legal right?

Project feasibility

5. Legal feasibility

• Pass tests to open ANREU account?

• Legal right to carry out project?

6. Organisational capabilities

• Own and operate?

• Engage third parties? (aggregator, broker, cooperative)

Conclusion

Purpose: understand what’s involved in implementing a piggery project

• Guide to implementing a project

• Administration

• Markets and feasibility

Thank you

More Information • Online: www.cleanenergyregulator.gov.au• Phone: 1300 553 542• Email: CFI@cleanenergyregulator.gov.au• Watch the webinar