Carbon Creation in the World of Global Warming Abatement

29 Pages·2006·1.62 MB·English

Carbon Creation in the World of Global Warming
Abatement
Ed Heslop, CEO
Environmental Credit Corp.
for
NYSERDA, March 29 2006
OOuuttlliinnee
• Environmental Credit Corp.
– Who we are, What we do
• Background on Global Warming
• “Cap and trade” Regulations
– Overview, Chicago Climate Exchange
• Carbon Credits
– What are carbon credits?
– Markets for carbon credits
• ECC Carbon Credit Programs
– Examples, case studies
• Mechanics of Trading
• Economic/Policy Considerations
2
EEnnvviirroonnmmeennttaall CCrreeddiitt CCoorrpp..
• Environmental Credit Corp. is a leading supplier of high
quality environmental credits to emerging global financial
markets.
• We are establishing a large and reliable source of carbon
credits through cost-effective, long-term projects that
reduce greenhouse gases.
• By creating economic value from environmental benefits,
we are demonstrating our commitment to a sustainable
balance between profitability and environmental
stewardship - for us, our partners, our world.
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EECCCC CCaarrbboonn CCrreeddiitt PPrrooggrraamm
Greenhouse Gas Achieved via
qualifying GHG
Emission Reductions
emission reduction
projects
ECC Carbon Credit Program
• Eligibility Assessment
Chicago Climate
• Protocol Development
Exchange, EPA,
• Monitoring
state or UN (Kyoto)
• Reporting
Protocols
• Verification
• Registration
Trade, bank, or Carbon Credits
sell through CCX,
(certified, tradable, $$)
ECX, or direct
4
GGlloobbaall WWaarrmmiinngg
• Historical trends in global
temperatures
• Anthropogenic emissions
of carbon dioxide
5
GGrreeeennhhoouussee GGaasseess
• Carbon Dioxide (CO )
2
• Methane (CH )
4
• Nitrous Oxide (N O)
2
• Sulfur Hexafluoride (SF )
6
• Perfluorocarbons (PFCs)
• Hydrofluorocarbons (HFCs)
• 6.9 billion metric tons CO e total
2
• 545 million metric tons from CH
4
• ~40 million metric tons from
manure management alone
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““CCaapp aanndd TTrraaddee”” RReegguullaattiioonnss
• Cap-and-trade regulations employ market forces to efficiently and
cost-effectively reach emission reduction goals
1. Regulated Emissions
• Regulated Sectors (“Large Emitters”)
– Energy, Manufacturing, Transportation
• Emission Allowances (“cap”)
– Established “baseline” emissions
– Scheduled reductions
2. Trading
• Allowances can be purchased and used for compliance
• Surplus allowances (credits) occur when reduction goals are surpassed
3. Emission “Offsets”
• Tradable credits for out-of-sector emission reductions
• Less expensive way of achieving early stage reduction goals
• Real, quantified, verified, certified emission reductions
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CCaapp aanndd TTrraaddee –– CChhiiccaaggoo CClliimmaattee EExxcchhaannggee
• Chicago Climate Exchange® is a voluntary, legally
binding pilot greenhouse gas reduction and trading
program for emission sources and offset projects in
North America and offset projects in Brazil.
• Pilot Phase, 2003-2006: Reduce emissions to 4% below 1998-2001 baseline
• Phase II, 2007-2010: Additional reductions to 6% below baseline by 2010
CCX Emission Reduction Schedule
• Includes major direct emissions
100
(all GHGs); sources small Phase I
sources (e.g. fleets) and 98
Phase II
electricity purchases can be
96
opted-in
94
• Annual true-up and verification
92
90
1998- 2003 2004 2005 2006 2007 2008 2009 2010
2001
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CCCCXX MMeemmbbeerrsshhiipp
Aerospace and Equipment Food Processing Pharmaceuticals
Rolls-Royce Premium Standard Farms Baxter International, Inc.
Automotive Forest Products Companies Private University
Ford Motor Company Abitibi-Consolidated Tufts University
Aracruz Celulose S.A.
Beverage Manufacturing Public University
International Paper
New Belgium Brewing Company The University of Iowa
Klabin S.A.
The University of Minnesota
Chemicals
MeadWestvaco Corp.
The University of Oklahoma
Dow Corning
Stora Enso North America
Dupont Recreation
Temple-Inland Inc
Aspen Skiing Company
Electric Power Generation
Information Technology
American Electric Power Semiconductors
IBM
Central Vermont Public Service Freescale Semiconductor
Manufacturing
Green Mountain Power ST Microelectronics
Bayer Corporation
Manitoba Hydro
Steel
Interface, Inc.
TECO Energy, Inc.
Roanoke Electric Steel Corp.
Ozinga Bros., Inc.
Electronics
Transportation
Municipalities
Motorola, Inc.
Amtrak
City of Berkeley
Environmental Services San Joaquin Regional
City of Boulder
Waste Management, Inc. Rail Commission
City of Chicago
City of Oakland
City of Portland (2006)
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WWhhaatt aarree ccaarrbboonn ccrreeddiittss??
• Certified reductions in greenhouse gas emissions
– Real, quantified, verified, certified emission reductions
– Expressed as metric tons of CO equivalents
2
• “Cap and trade” framework
– Emissions reductions goals (“cap”)
– Credits allow overall goals to be reached efficiently (“trade”)
• Regulations requiring emissions reductions
– Kyoto Protocol
– McCain/Lieberman, Hagel, Bush Administration approach
– California Climate Action Registry, Western Governor’s Initiative, RGGI
(Northeastern states)
– Voluntary regulatory programs: Chicago Climate Exchange, EPA
Climate Leaders
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