Carbon Reporting under the RTFO Dr Ausilio Bauen E4tech DG Env, Brussels, 29th May 2007

Contents Why Carbon Reporting? Methodology for carbon reporting Methodological issues Practical implementation Example

Carbon reporting can help the RTFO achieve greater GHG savings and provide a better measure of its impact RTFO’s main objective is to reduce GHG emissions Carbon intensity varies by biofuel type (e.g. bioethanol, biodiesel,…) depending on: Type of feedstock Way in which feedstock was produced Characteristics of conversion process Concerns over GHG benefits of biofuels and RTFO impact Reporting on carbon intensity of biofuels expressed in gCO2e / MJ fuel Metric which compares GHGs emitted in producing and distributing different biofuels Allows comparison with fossil fuel references and determination of GHG savings

2 projects: Carbon Reporting and Sustainability Reporting Carbon Reporting Project Sustainability Reporting Project Objectives To develop a robust, practical & cost-effective methodology for: The consistent quantification of GHG savings for biofuels from different fuel chains Sustainability reporting of fuels from diverse origins To develop & disseminate technical guidance to enable companies to apply the requirements effectively Methodology development Draft Technical Guidance development Piloting Finalising Technical Guidance Roll out of Technical Guidance Project inception Structure Formal consultation By mid Jan By mid Mar By mid Mar - Aug By end Sep By end Mar 08

What data is required for monthly reports? Fuel suppliers will be required to report, for each administrative batch: Carbon intensity of batch of fuel Impact of any land use change Accuracy level of carbon intensity

Contents Why Carbon Reporting? Methodology for carbon reporting Methodological issues Example

carbon intensity calculation Boundaries LUC (indirect) Assessed ex post by RTFO Administrator LUC direct Boundary for monthly Cultivation & Cultivation & carbon intensity calculation harvest harvest Fossil fuel reference system Assessed separately Biofuel use Feedstock Biofuel Biofuel transport production transport Waste Waste material material Alternative waste management Excludes minor sources, from: • Manufacture of machinery or equipment, chemicals PFCs , HFCs , SF 6

Co-products A variety of co-products food products, animal feed, chemicals, energy Addressed within methodology as practically and accurately as possible Approaches: Substitution approach preferred Various “allocation” methods are available - most appropriate is selected for each co-product, but consistency needed Current co-product treatment in default chains: Substitution animal feeds: soy meal, rape meal, DDGS/WDGS Allocation by energy content co-products used for energy: electricity, heat, wheat straw, palm fibre and shells, DDGS/WDGS, rape meal, soy meal Allocation by market value chemicals, some palm co-products: e.g. glycerine, potassium sulphate, palm kernel oil and stearin, palm stearin

Contents Why Carbon Reporting? Methodology for carbon reporting Practical implementation Example

Default chains Default fuel chains are defined using a set of common modules Modules represent stages in the fuel chain Modules contain data points and calculations to derive carbon intensity

Module example: Crop production

Module example: Conversion

Default data exist for all data required to calculate the carbon intensity of a fuel chain Default data have been collected for the following chains: Ethanol from: sugar cane, sugar beet, wheat and corn Ethanol converted to ETBE FAME biodiesel from: tallow & used cooking oil, palm oil, soy and rapeseed Biomethane from anaerobic digestion of organic MSW, dry manure & wet manure Biofuel default values based on limited fuel chain information: Fuel Fuel & feedstock Fuel, feedstock & origin Biofuel default values can be edited using qualitative information: Selected defaults for: mode of transport; conversion plant energy configuration

Quantitative data can be used to more accurately reflect fuel chain emissions Best focused around key data points which have a significant influence on final carbon intensity Crop production Yield Nitrogen fertiliser use (Diesel use) Conversion plants (biofuel and crushing) Plant yield [t biofuel / t feedstock] Natural gas use (Electricity) Co-products Feedstock transport Distances (primarily for non-EU crops)

Contents Why Carbon Reporting? Methodology for carbon reporting Methodological issues Practical implementation Example

Example – biodiesel producer

Questions bauen@e4tech.com