Page 1 Carbon Credits How do they Work?
Jul 21, 2016
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Carbon Credits How do they Work?
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Independent Inspections Pty LtdP: 1300 857 149F: 1300 857 150M: 0402 259 [email protected]
Australia to move to Emissions Trading Scheme thanks to Palmer United Party
What is Means to Australians
By Peter Greenham
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IntroductionAmendments to legislationUnited Nations Commitment Carbon CreditTypes of CreditsCarbon Farming?Carbon Reduction Project?Case Studies
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Amendments to legislationThe Current legislation is in 14 parts and is underpinned by
the Emissions Trading Scheme (Commodore with a bumper bar).
The carbon tax was designed to minimise the impact (Bumper Bar) before the Emissions Trading Scheme or ETS came into play
The Abbott Government have used the word ‘Sustainability” in a business sense and not in the environmental impact in which is was originally defined in 1998 when ISO 14000 the international standard was introduced in environmental management.
The Renewable Energy Target, to Stay in placeClean Energy Finance Corporation , to Stay in place There will be a initial zero price on carbon until a new price
is set. This will Give business both direction and a boost of
certainty.
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United Nations Commitment
Why did we do it ??Australia in the International Context The Australian Government has committed to reducing
Australia’s carbon emissions by between 5 and 25 per cent from 2000 levels by 2020, depending on the scale of global action at the United Nations Conference.
The Government has also adopted a new long-term target, committing to reduce Australia’s carbon emissions by 80 per cent from 2000 levels by 2050.
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What is a Carbon Credit?Each carbon credit represents one tonne of carbon dioxide equivalents (CO2-e).
Abatement from all sorts of activities, including those that reduce methane or nitrous oxide emissions, can be measured in tonnes of CO2-e.
This standardisation allows the credits from different activities to be traded more easily.
Carbon credits can be traded and used to meet mandatory obligations and voluntary commitments
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Types of Carbon Credit?There are voluntary and Regulated Carbon CreditsThe standard used is ISO14064.
Source: Carbon Market Institute
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Carbon FarmingThe Carbon Farming allows farmers
and other land managers to earn carbon credits by storing carbon or reducing
greenhouse gas emissions on the land.
These credits, known as Australian Carbon Credit Units (ACCUs), can be sold to people and businesses wishing
to offset their emissions.
This helps rural communities supporting sustainable farming by creating
incentives for landscape rehabilitation.
Participation is voluntary; farmers and landholders can choose whether or not
to be involved.:
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Carbon Farming Trees in a project are measured for Specific
Gravity to work out how much carbon is absorbed, depending on the type of tree.
The Rule of thumb is 5 trees to one tonne of Air.
Each project will have to be audited annually to make sure the trees are there and the amount is correct.
The project is put on a register, and then sold on a trade exchange,
Businesses and Farmers that take action will be better prepared to adapt their business operations.
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Land Example Bill approaches landholders in the region, including the GreenSheep Co, seeking to
buy their carbon rights. Some landholder agree. Bill pays these landholders for their carbon rights upfront and then manages every aspect of the revegetation project on their land. In this case, Bill is an aggregator and the recognised offsets entity. He has responsibility for the project and he receives the carbon credits.
However, if Bill were to cease operating, a carbon maintenance obligation would be applied to the land. The Green Sheep Co would not have to submit reports, but they could not destroy the carbon stores unless they removed the carbon maintenance obligation by relinquishing credits. The carbon maintenance obligation would also apply to future owner of the land unless the Green Sheep Co or the purchaser relinquished sufficient credits to lift the obligation.
The Green Sheep Co is not interested in selling their carbon rights to Bill. The company director wants to plant trees on a portion of each of his six properties, retain his carbon rights and sell the ACCUs he receives for the project. The Green Sheep Co becomes the project proponent and pays Bill a fee to develop, manage and report on the company’s reforestation project. In this case, Bill is a service provider. The Green Sheep Co is the recognised offsets entity and receives the carbon credits.
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Solar LIght A LED solar light used instead of Kero lamp produces carbon credits over time. The issue More than 1 billion people in the developing world use kerosene or candles for lighting. The benefits of replacing kerosene lanterns with solar-powered lights are to: Reduce poverty: Kerosene accounts for up to one third of household budgets, eliminating this
expense means illumination customers have more money to spend on food, education and medicine;
Improve health and safety: Kerosene fumes are toxic causing respiratory/eye ailments and cancer, and the toppling of kerosene lamps is the largest cause of house-fires;
Improve personal security: the provision of light in refugee camps
Improve education: Solar lights provide better and less expensive light than kerosene, enabling children to study longer and safer at night;
Reduce greenhouse emissions: reducing greenhouse gas emissions from burning kerosene alleviates global warming;
Conservation of biodiversity: high kerosene prices push some people to use firewood, exerting pressure on forest resources and reducing biodiversity.
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Carbon FootprintThe calculation of the carbon footprint of an organisation or product should be performed in accordance with the following principles, which are based upon those outlined in the GHG Protocol and adopted under the NGER System. These principles are consistent with those outlined under the other Australian and international standards referenced throughout the Standard, including the AS ISO 14064 and ISO 14040 series.
The Emissions are broken into 3 areas:Scope 1 Emissions: The release of Greenhouse Gas into the atmosphere as a direct result of a activity.Scope 2 Emissions: The release of Greenhouse Gas as a result of one or more activities that generate electricity, heating, cooling or steam that is consumed by the facility but does not form part of the facility.Scope 3 Emissions : The release of Greenhouse Gas into the atmosphere that occurs outside the boundary of a facility as a result of the activities of the facility and are not scope 2 emissions.
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Carbon FootprintA graphical image shows Scope 1,2 and 3 Emissions below:
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Breakdown by AreaTypical Carbon Output of a business with $250,000 in Business Costs using data from the Expense sheet
There are ways to reduce this impact of this cost through purchasing Carbon Credits around $15 per tonne.
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Carbon Footprint process In order for any organisation to manage the
impact of its greenhouse gas emissions, it must first quantify them. Independent Inspections (II) does this by conducting an emissions audit.
5. Client walk thru
1. Client Assessment
3. Data inputinto carboncalculator
4.Carbon Footprint Report generated
2. Client Data
collection
I.I’s Carbon Audit
Process
II’s greenhouse gas audits follow the structure provided by the International Standard 14064.1.
This standard prescribes the inclusions and flow of company level greenhouse gas audits.
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Why Independent Inspections Pty Ltd
All consumers and businesses are likely to be affected by the carbon tax as the high energy users pass on the cost of the tax down the chain.
I.I. can assistance in determining what your risks and opportunities might be under the carbon tax. It is one of five (5) companies that is certified to audit scope 3 emissions in Australia.
I.I is a member of the United Nations Global Compact and the Carbon Market Institute providing up to date information to its clients reporting to AS ISO 14064.1-2006 Guidelines
It has a dedicated team that will assist you step by step through the entire carbon footprint assessment process. From there we can give advice on how to reduce it as well as save yourself money and can even sell you carbon credits to completely offset it.
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Independent Inspections - Services
We deliver Sustainability Services & Solutions from
Building Cost Management, Energy & Carbon Emission
Audit Reports leading to Reductions in Costs , CO2
Emmissions and Carbon Footprints.
We provide Training solutions and RTO
Accreditted Courses In Sustainability, Laboratory, Chemical ,Environmental
and Quality Auditing.
We can deliver the audting process of conducting a systematic examination of your quality system.
We can deliver a systematical examination of your management systems carried out by an auditor or an audit team. It is an important part of organisation's quality management system and measured against the Australian and New Zealand Safety Standard 4801.
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Independent Inspections Pty Ltd
Independent Inspections Pty Ltdwww.iigi.com.au
www.fwrgroup.com.auwww.independentcertification.com.au
Mr. Peter GreenhamQualifications:- Diploma of Civil Engineering- Associate Diploma of Laboratory
Operations- Diploma of Quality Management- Diploma of Business- Lead Environmental Auditor- Diploma of workplace training
and Assessment- NATA Asessor
Your Carbon Auditors
P: 1300 857 149F: 1300 857 150
Sales Team
Mr. Jonathan Yuen (B.Bus)M: 0419 188 [email protected]
Mr. Peter GreenhamM: [email protected]