General CF and CDM Jan 2011
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Transcript of General CF and CDM Jan 2011
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TAPPING THE CARBON
MARKETS
January, 2011
Give your brand a green advantage
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CONTENTS
INDUSTRY: GROWING REQUIREMENTS OVER TIME
INTERNATIONAL CARBON MARKET
EMERGING NEED
PROPOSED APPROACH
CARBON FOOTPRINT: AN IMPORTANT STEP IN GOING GREEN
CLEAN DEVOLOPMENT MECHANISM (CDM)
ECOLOGIKOL ROLE
ABOUT US
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Industry: Growing Requirements over time
Over the years, stakeholders have required industry to implement variousCompliance initiatives such as:
Quality
Safety
Social Accountability
Ethical Standards
Environmental Standards
What Next?
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The New Need is for Green: Are we Ready?
Market, Policy and Regulatory Forces are driving Organisations towards Green
initiatives Market Forces
International Carbon Market
Increasing cost of energy
Increasing consumer awareness and demand for greener products, servicesand supply chain
Major corporations are going Green creating peer pressure
Stakeholders expectations on organisations to act Environmentallyresponsible
Reducing cost of clean technologies and easier access
Customers prefer greener services/products and in many cases, are willing
to pay a premium for such services Globally, there is a shift towards Greener Lifestyles and Eco living
Policy Forces
National and International Action Plan on Climate Change
National and International incentives for Renewable energy and Clean Tech
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The New Need is for Green: Are we Ready?
Market, Policy and Regulatory Forces are driving Organisations towards Green
initiatives
Regulatory Forces (existing and proposed)
Mandatory Energy Efficiency Standards
Mandatory Emission caps by Governments
Proposed Carbon tax for emission and fossil fuel intensive exports
Mandatory Renewable Energy Targets
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International Carbon Market
Consumer
preference
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The Emerging Need
A glance of the regulatory, policy and market forces as explained above
clearly indicates the following:
The impact of climate change related forces are becoming critical to
businesses
These forces are dynamic and growing at a fast pace
A Sustainability Strategy is the first step in consolidating all climate
change related matters of the Company and would help in informed and
objective decision making This shall start with a Carbon and Ecological Footprint Assessment of the
organisation
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Proposed Approach
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CARBON
FOOTPRINT
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Carbon Footprint: An important step in GoingGreen
Carbon Footprint is a measure of the impact a product/service has on
the environment in terms of the amount of green house gases produced
It involves the assessment of emissions from energy consumption,
processing, transportation, waste management, raw material and supply
chain among others
The Carbon Footprint of a product or a service could be determined and
represented as tonnes of CO2 per unit service or product
A verified Carbon Footprint of a product/service can be published
The GHG emissions associated with a service/product can be measured
and reduced or offset by means of other emission reduction credits
A product/service with net zero GHG emissions can be labelled as
Carbon Zero (eg: xxxxxxxxxxxxxx)
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THE PROCESSAssessment of Emissions are categorized under nine broadcategories:
Energy use
Chemical reactions
Combustion process Refrigerant loss
Operations
Service provision and delivery
Land use change
Livestock and other agricultural processes
Waste
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CLEAN DEVELOPMENT
MECHANISM
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Climate Change is the enhanced Greenhouse Gas effect
The greenhouse effect is a natural phenomenon that helps regulate theEarths temperature.
Greenhouse gases act like an insulating blanket, trapping solar energythat would otherwise escape into space.
Without the natural greenhouse effect, Earths temperature would beabout 30 C lower than what it is now.
Anthropogenic activities, primarily the burning of fossil fuels have
increased the natural green house effect.
As a result, the average atmospheric temperature increases resulting inClimate change
Climate Change
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GHG and Climate Change
Green house gas
(GHG)
Carbon-di-oxide (CO2)
Methane (CH4)
Nitrous oxide (N2O)
Per fluoro carbons (PFCs)
Hydro fluoro carbons (HFCs)
Sulphur hexa fluoride (SF6)
Global Warming Potential(GWP)
1
21
310
Upto 9,500
Upto 11,700
23,900
Human activities are increasing the concentration of Green
House Gases (GHGs) in the atmosphere.
This enhances the green house effect, commonly known as
Climate Change
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International Carbon Market
Consumer
preference
Carbon credits are generally traded in tonnes of CO2
equivalent.
1 tonne of CO2 reduction = 1 carbon credit
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INTERNATIONAL CARBON MARKETS
KYOTO CARBON MARKET
Kyoto Protocol was formed by the UN to reduce global GHG emissions
It provides GHG reduction targets for Annex-1 (developed) countries (5.2%
below 1990 level for the period 2008-2012)
Negotiations are underway for the subsequent periods
VOLUNTARY MARKETS
Several socially responsible Companies, Individuals, Events etc are reducing
their carbon footprints by purchasing carbon credit offsets
REGIONAL MARKETS
National and State Governments have developed their own carbon reduction
programs with cap and trade schemes
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Clean Development Mechanism
Kyoto Protocol requires developed countries to reduce their emissions by specific
amounts
The Clean Development Mechanism (CDM) is an arrangement under the Kyoto Protocol
allowing developed countries with GHG reduction commitment to invest in emission
reduction projects in developing countries.
CDM is an alternative to more expensive emission reductions in their own countries.
CDM intends to provide incentives to cleaner technology projects and make them viable,
which would otherwise not be implemented due to various barriers
A crucial feature of a CDM project is that it has established that the planned reductions
would not occur without the additional incentive provided by emission reductions credits,
a concept known as "additionality.''
2700 projects have been registered worldwide till date as CDM
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Basic CDM Eligibility
The construction of the project should have started after01 Jan 2000.
Project should start the CDM process parallel to theconstruction activity. Should intimate UNFCCC
Start Date
Project should result in reduction of any of the six GHGgases under the Kyoto ProtocolGHG Reduction
Project should not be implemented as a result of a policy
or legal mandate (e.g.,: To meet pollution norms)Voluntary
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Basic CDM Eligibility
In the normal scenario, the project would not be
implemented due to technological risk or poor financial
viability or other such barriers
Additionality
The consideration of CDM revenue should make theproject viable
Proof of knowledge of CDM and the consideration of
CDM revenue during decision making is important
CDM Consideration
Sustainable
development
Project should contribute to the socio-economic,
technological and environmental well being of the regioneither directly or indirectly
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Availing Carbon Credits
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Carbon Credits General Thumb rules
1 MWh of electricity saved = 0.75 carbon credits approx.
1 MWh of renewable electricity generated = 0.75 carbon credits approx.
1 Tonne of fuel oil saved = 3 carbon credits approx.
1000 M3 of gas saved = 2.2 carbon credits approx.
Minimum number of credits per project to cover CDM cost = 5000 carbon credits
per year
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Ecologikol's Role
Ecologikol helps organisations to go green with the following solutions :
Climate Change Impact Assessment and Strategy Identifying opportunities and
risks for businesses
Estimation of Carbon Footprint and Facilitation for Carbon Certifications
Green Factory Advisory Services
Corporate Sustainability Reporting (As per GRI Standard)
Carbon Credit Advisory Services
Renewable Energy Services
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ABOUT US
ECOLOGIKOL is the brain child of a group of energy and environmental experts
with extensive and pioneering experience in the field of Climate Change,
Energy and Sustainability.
Our Professional team, gathered from leading Multi National Consulting
organizations, have been associated with some of the first Climate Change
and Green Factory projects in India and have many registrations
subsequently to their credit.
Our Professionals are experienced in successfully managing and executing
more than 50 climate change projects across various sectors such as
textiles, sugar, cement, paper, iron and steel, oil and gas, renewable energy,
automobiles etc
Our professionals have worked with projects for major Corporates in South India
such as TNPL, Shri Renuga Textiles, Sree Santhosh Garments, EID Parry,
Bannari Amman Sugars, Auro Mira, MSPL, Nippo, Aditya Birla etc.
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Contact
ECOLOGIKOL Advisors India Pvt. Ltd.
No.26/7, Abhirampuram First Street,
Chennai - 600 018, India.
Phone 1: +91-44 45534101|
Email: [email protected]
mailto:[email protected]:[email protected]