CLIMATE LEADERS

SETTING THE STANDARD IN GREENHOUSE GAS MANAGEMENT

Greenhouse Gas Workshop:

Developing a GHG Management Strategy
Federal Environmental Symposium East
June 2, 2008
 Federal Leadership on climate and
energy

• Energy Star
• 175 Federal buildings with Energy Star label
• Portfolio Manager (Veteran’s Administration has linked
energy tracking system to provide current ratings)
• New feature in PM to calculate emissions from building
data
• Green Power Partnership- U.S. Air Force, VA, and
EPA among top purchasers
• Federal Energy Management Program
• Collecting energy data, promoting best practices,
emissions calculations
 Next Frontier:
Agency-wide greenhouse gas management

Main Street
• Significant public interest,
green shoppers, educated
consumers
Employee satisfaction
• Staff want to feel employer
is good corporate citizen
E.O. 13423
• Annual energy efficiency and renewable energy goals
• Goal to “reduce greenhouse gas emissions”
Legislation coming?
• Draft House bill H.R. 3221 (2007) included requirement
for agencies to inventory GHG emissions as part of
Carbon Neutral Government Act (did not pass)
 Benefits of Developing a Strategy

• Reduce impact on the global environment

• Better manage greenhouse gas emissions and
associated risks across emissions sources (buildings,
fleets, plants, etc)
• Realize cost savings through energy efficiency
• Integrate climate change strategies with State,
Regional, and International GHG accounting schemes

National Renewable Energy Laboratory and

U.S. Forest Service
are Partners in Climate Leaders
 Credible Climate Strategy

Climate Leaders works with organizations to develop

a long-term comprehensive GHG management
strategy

• Road-tested with nearly 200 partners from every major

sector across the country, representing 8% U.S.
emissions and 10% U.S. GDP
• 3 critical components to credible strategy
• Complete Agency-Wide GHG Inventory
• Develop Inventory Management Plan (IMP)
• Set Aggressive Agency-Wide GHG Reduction Goal
• Annual reporting to EPA creates lasting record of
accomplishments and identifies agency as
environmental leader
• EPA recognizes and publicizes progress in the program
 Program Participation Steps

Partner Joins Program

EPA assists Partner in developing inventory and inventory

management plan (generally within 1 year)

Partner sets agency wide 5-10 year GHG reduction goal

Partner may participate in meetings, public outreach,

press events, etc.

Partner reports annual inventory data to EPA and

documents progress toward goal

Partner Achieves Goal

 National Public Recognition

Climate Leaders Partners

receive high-level recognition via:

• Press events
• Recognition events with EPA
• Page on CL web site
• Use of program logo
• Articles in local, national, and
trade magazines
• Partner conferences, newsletters,
speaking opportunities
• Public Service Announcements
(PSAs) in mainstream press.
2007-8 PSA seen by over 10
million people
 Reporting
First and Second
Components
 EPA Inventory Guidance

Based on
International WRI/WBCSD GHG Protocol:

• The most widely used international accounting tool for

government and business leaders to understand,
quantify, and manage energy use and greenhouse gas
emissions.
• Convened in 1998 by the World Resources Institute
(WRI) and the World Business Council for Sustainable
Development (WBCSD)
• Multi-stakeholder development process included several
hundred individuals from corporations, NGOs, and
governments throughout the world.
 GHG Protocol- Global Adoption
Voluntary Climate Initiatives
 U.S. EPA Climate Leaders Program
 China, India, Mexico, Brazil, and
Philippines GHG Management Programs
 Korea National GHG Registry
 South Africa NBI/BUSA-DEAT Initiative
 WWF Climate Savers Program
GHG Registries
 The Climate Registry
 US DOE 1605b Registry
 WEF Global Registry
Multilateral Non-government Initiatives
 International Standards Organization (ISO)
Industry Initiatives
 WBCSD CSI Protocol
 International Forum of Forest
and Paper Associations
 International Aluminium Institute
Market Initiatives
 AP 6 Initiative Cement Sector
Protocol
 Carbon Disclosure Project
 Chicago Climate Exchange
 EU Emissions Trading Scheme
(informed by GHG Protocol
calculation tools)
 First Component:
Develop a Customized Inventory

Required
• Agency-wide
• 6 major Greenhouse Gases (CO2, CH4, N2O, PFC, HFC,
SF6)
• Direct emissions
• Indirect emissions from electricity, heat, and steam

Optional
• Offset projects
• Employee travel and commuting
• Product transport
• Contractor operations/sites
 Step 1
Identify Organizational Boundaries
Which facilities should you include?
ORGANIZATIONAL
BOUNDARY
APPROACH

EQUITY SHARE
CONTROL
(by % ownership)

FINANCIAL CONTROL
(by economic interest)

OPERATIONAL
CONTROL
(by operating policies)

Approach matters most for treatment of partially owned or

operated facilities (e.g. government owned – contractor operated)
and for lease agreements
 Step 2
Identify Operational Boundaries

Which sources of emissions should you include?

• Stationary Combustion of fossil fuel

• Process emissions
• Mobile Sources
• Refrigeration/AC
• Purchased electricity or steam
• Other Sources: backup generators, fuel for
heating, aircraft, anaerobic wastewater treatment
• Optional Sources (e.g., business travel)
 Emissions “Scopes”

Source: WRI/WBCSD GHG Protocol

 Example Calculations

EPA has calculation guidelines and tools available

Example of calculation (Stationary Combustion):

CO2(m.w.)
Emissions = ∑ Fueli x HCi x Ci x FOi x
n

i=1 C (m.w.)
Where:
Fueli = Mass or volume of fuel type i
combusted
HCi = Heat content of fuel type i
Ci = Carbon content of fuel type i
FOi = Fraction oxidized of fuel type i
CO2(m.w.) = Molecular weight of carbon dioxide
 Step 3
Choose a Base Year

• Typically the most recent year for which quality data

are available
• For federal agencies may be defined by E.O. 13423
guidelines
• Rules for adjusting your base year data for:
• Acquisitions/divestitures: adjust your base year data
when these occur
• Organic growth/decline: do not adjust your base year
data

Question to ask: Are these new emissions to the

atmosphere, or did they exist previously?
 Second Component
Create an Inventory Management Plan

Institutionalizes process

Develop and implement an IMP or a similar collection of

Standard Operating Procedures and document process
• EPA provides checklist of
components for good IMP to
use as guideline when
preparing documentation

• EPA offers technical

assistance to help
organizations complete IMP
documentation
 IMP Components

• Partner Information
• Boundary Conditions
• Facilities and sources included
• Emissions quantifications
• Methods and factors
• Data management
• Activity data, data management process, QA/QC
• Base Year
• Adjustment thresholds
• Management tools
• Roles & responsibilities, training, document retention
policies
• Auditing & verification
• Internal & external
 IMP Requirement Example

Agency should provide specific information on the

emission factors and other constants used to develop
GHG inventory
• A list of emission factors and other constants and
reference for factors and constants (i.e. Global
Warming Potentials and conversion factors) for each
emission category
• Descriptions of the process for how external references
are kept current
• Where multiple factors are used, specify which facility /
source uses the respective factor
 Inventory Management Plan
Internal Benefits

IMP provides assurance that Partners develop a high-

quality inventory that is consistently maintained and
updated over time
• Institutionalizes inventory process
• Leads to comprehensive & credible data management
• Increases efficiency/lowers costs by centralizing
processes
• Increases accuracy and transparency
• Facilitates long-term emissions/goal tracking
• May facilitate documentation of capital savings
• Allows for continual improvement
 Resources Available

tp://www.epa.gov/climateleaders/resources/index.html
 GOALS
Third Component
 Third Component
Set an aggressive, long-term GHG goal

• Absolute
• 3M pledges to reduce total U.S. GHG emissions by 30
percent from 2002 to 2007
• Normalized
• Holcim (US) Inc. pledges to reduce U.S. GHG emissions
by 12 percent per ton of cement from 2000 to 2008
• Index
• Ball Corporation pledges to reduce total U.S. GHG
emissions by 16 percent per production index from 2002
to 2012
• Net Zero (“Carbon Neutral”)
• Melaver, Inc. pledges to achieve net zero U.S. GHG
emissions by 2006 and maintain that level through 2009
 Ensuring leadership goals

Criteria:
• Agency-Wide
• Based on the most recent base year for which data are
available
• Achieved over 5 to 10 years
• Expressed as an absolute GHG reduction or as a
decrease in GHG intensity
• Aggressive compared to the projected GHG
performance for the sector

EPA individually negotiates each

Climate Leaders goal
 Benefits of Setting a Goal

• Focus high-level attention on existing and potential

reduction activities
• Institutionalize management and tracking of progress
for energy and GHG reduction activities
• Encourage innovation
• Identify new reduction opportunities
• Employee morale, recruiting, and retention
• Positive media attention
 How to set a goal

• Assemble a broad-based team

• Engineers, environmental, energy, communications,
procurement, policy
• Analyze GHG data
• Relative contribution of scope 1 vs 2 vs 3
• Compare similar facilities
– absolute energy level
– intensity (e.g. energy use per square foot of building space)
• Evaluate historic data and trends if possible
• Identify any existing company goals in energy and/or
environment
• E.g. EO 13423
 Analyze Future Scenarios

• Identify planned construction, moves, facility

closures, etc and likely effects on emissions
• Analyze low and high ranges of growth
projections
• Facility- office, data centers, labs
• FTEs
• Analyze energy price forecasts
 Identifying Reduction Opportunities

Identify best practices in marketplace

• Energy management systems
– automated tracking
– corporate energy manager and team
• Innovative technologies
Identify projects
• Already in pipeline
– Energy efficiency
– Renewable energy
– Capital projects that might improve efficiency
• Future possibilities/ “wish list”
• Conduct financial analysis of projects
 Working with a 3rd Party

Working with a 3rd party to set a goal can add

credibility to your effort

EPA process:
1) Partner presents an initial goal proposal to EPA
(based on inventory and internal analysis)
2) EPA completes performance benchmark
analysis- evaluates sector “business-as-usual”
energy/carbon intensity performance
3) Partner and EPA negotiate a mutually agreeable
goal- “aggressive yet achievable”
4) EPA publicly announces a goal and provides
recognition for company’s efforts
 EPA Analysis
Creating a Performance Benchmark

Three models to determine Business-As-Usual sector

improvement rates & current average intensity rates
based on company’s sector
• DOE’s National Energy Modeling System (NEMS)
 forecasts fuel-specific consumption for heavy industry
 forecasts commercial building energy demand
• Bureau of Labor Statistics (BLS) Forecast
input/output tables for the US economy
 estimates fuel quantities purchased/$output
• ICF’s Integrated Planning Model (IPM)
 For electric generators
 Sample Goal Setting Analysis

California Portland Cement Company

• Goal Proposal: 9% per production index from 2003-
2012
• Sector’s forecasted benchmark improvement rate
(NEMS model):
 Reduce CO2 emissions by 4.12% per ton of cement
output by 2012
• Cal Portland exceeds forecasted BAU improvement
rate by 118%
• Additional Factors: Energy Star Partner (Partner of the
Year 2005), current intensity better than sector average
 Tracking your Progress

• Always track your absolute emissions

• If you choose a normalized goal:
• Determine an appropriate production metric that makes
sense for your agency
– Should correlate closely to GHG emissions to measure
accurately improvements in efficiency
– Examples: square footage of building space (energy
tracks more closely to this than to, e.g. # employees)
• If you divest a facility, make sure to adjust for
production metric as well as emissions
 Using RECs and Offsets

• Renewable Energy Certificates (RECs) and offsets

are considered an “adjustment” to emissions and can
be used towards meeting goals
• RECs - credible way to reduce emissions from
electricity use, should follow green power market
definitions for eligibility
• Offsets - project-based reductions, apply towards
Scopes 1 and 3
• Climate Leaders methodologies for landfill gas,
anaerobic digesters, commercial & industrial boilers,
transit bus projects, reforestation/afforestation
• Based on performance standard approach
• Questions on whether federal government authorized to
make these purchases
 Going “carbon neutral”

1. Develop a robust GHG inventory and inventory

management plan
• Include at least one significant optional source
2. Achieve Internal GHG Reductions
• Commit to implementing internal GHG reduction
measures. This commitment should be expressed as
an internal GHG reduction goal that is aggressive as a
stand-alone goal
3. Purchase Green Power, Renewable Energy Certificates
(RECs), and/or Offsets
• Green Power/RECs to reduce emissions associated
with electricity use
• Project-based reductions to offset the remaining
emissions from direct, other indirect, and optional
emissions sources
 Results
Leadership in the Defense Industry

2004:
• UTC pledges to reduce global GHG emissions by 16
percent per dollar revenue from 2001-2006.
2006:
• Lockheed Martin pledges to reduce U.S. GHG
emissions by 30 percent per dollar revenue from 2001-
2010.
• Raytheon Company pledges to reduce U.S. GHG
emissions by 33 percent per dollar revenue from 2002-
2009.
2007:
• UTC reduced global GHG emissions by 46 percent per
dollar revenue from 2001-2006. UTC pledged to reduce
total global GHG emissions by 12 percent from 2006-
2010.
??2008??
 General GHG Reduction Methods

“Low Hanging Fruit”

• Lighting Projects (sensors, CFL and high efficiency lights)
• Upgrade Cooling (high efficiency units, system balance)
• Reduce Plug Load (high efficiency equipment)
• Variable Speed Systems for Air Handling and Product
Distribution
• Mobile Sources (employee travel/commuting and product
transport)
“Higher Hanging Fruit”
• Combined Heat and Power (CHP)
• Landfill Gas Recovery
• Install Green Power (solar panels, micro turbines)
Innovative Projects
 New Heating/Cooling Systems (ice, under floor distribution,
solar and wind building exposure)
 Green Roofs
Thank you

Manuel J Oliva, PE
(202) 343-9094
oliva.manuel@epa.gov

Bella Tonkonogy
(202) 343-9183
tonkonogy.bella@epa.gov

www.epa.gov/climateleaders