Development of a Nitrous Oxide Reduction Protocol Presented By: Rob Janzen, Ph.D. P.Ag. VP, Western Operations ClimateCHECK Presented To: M-AGG Workshop 10 June 2010 University of California Davis ClimateCHECK SET THE STANDARD TM Copyright © Climate Check Corporation. All Rights Reserved.

Copyright © Climate Check Corp. All Rights Reserved.Innovative Greenhouse Gas Management Solutions. About ClimateCHECK GHG management services, strategic advisory, GHG inventories, carbon offset protocols and origination Completed nearly 400 assignments and 100 methodologies cleantech and GHG management Involved in many standards initiatives including WRI, CDSB, IEEE, CAR, VCS, CDM,… Cofounded GHG Management Institute (501c3 based in DC) 4,000 members in 100 countries Partners: UNFCCC, WRI, CDP, TCR, Earthscan, World Bank GHGMI Programs ― GHG training program (e-learning), Membership with online portal, Professional certification program 2

The Fertilizer Institute represents US fertilizer industry (producers, importers, retailers, wholesalers and companies serving the fertilizer industry). Full-time Washington D.C. staff in various legislative, education and technical areas as well as with information and public relations programs. The Fertilizer Institute is currently collaborating with ClimateCHECK to develop a protocol to implement and verify N 2 O emission reductions through the utilization of the 4R Nutrient Stewardship System.

Copyright © Climate Check Corp. All Rights Reserved.Innovative Greenhouse Gas Management Solutions. N 2 O Emission Reduction Protocol (NERP) NERP is developed by experienced protocol developers through comprehensive and transparent consultation with qualified stakeholders, within the discipline imposed by the ISO standard. NERP is based on best available science, implemented according to a comprehensive and globally-adopted 4R system for sustainability of fertilizer management. NERP is championed by the institutes representing major participants in the manufacturing, distribution, and retail segments of the plant nutrients sector of North America — Canadian Fertilizer Institute, International Plant Nutrients Institute, and The Fertilizer Institute. NERP is supported by commitments of substantive funding from industry for efforts ranging from basic research in nitrogen dynamics to training of farm advisors. 4

Copyright © Climate Check Corp. All Rights Reserved.Innovative Greenhouse Gas Management Solutions. Protocol Development — NERP N 2 O Emission Reduction Protocol (Alberta Offset System) Based on 4R model to minimize accumulation of nitrate N, as compiled in IPNI literature review. BMPs organized into Basic, Intermediate, Advanced performance levels according to a 4R N management plan. N 2 O emission reduction from change in amount of N added (rate) quantified by Canada-specific NIR method, and reductions from change in N management (source, time, place) accounted by reduction modifiers. Canada-specific approach based on extensive field data, as interpreted by consensus of national team of experts, and as reviewed in UNFCCC process. Reduction modifier derived from literature review of N 2 O emission reductions associated with BMPs, as interpreted by expert consensus. Training of Certified Crop Advisors in North America. 5

Copyright © Climate Check Corp. All Rights Reserved.Innovative Greenhouse Gas Management Solutions. NERP Offsets — Sample data for corn 6 Fertilizer (kg N ha -1 ) Corn Yield (kg DM ha -1 ) Reduction (kg CO 2 e kg -1 DM) Reduction (Mg CO 2 e ha -1 ) (↑NUE) (↑NUE, ↑DM) Baseline — fertilizer 170 kg N ha -1 (150 lb N ac -1 ) and yield 7750 kg DM ha -1 (145 bu ac -1 ); N 2 O of 2.44 Mg CO 2 e ha -1 and kg CO 2 e kg -1 DM corn. Project — increase NUE and DM yield; Basic NERP performance level, reduction modifier = 0.85.

Copyright © Climate Check Corp. All Rights Reserved.Innovative Greenhouse Gas Management Solutions. Protocol Development — Schedule Q3/Q Engage experts in science-based process. Assessing Baseline. Identify common practice for N management. Compile evidence that 4R plan serve as ‘gateway to reductions’. Identifying Project BMPs / technologies. Identify 4R-conformant BMPs / technologies to reduce N 2 O emissions for various climate and cropping regions of the US. Develop quantification approach. Balance sensitivity and verifiability. Implement at level of Major Land Resource Areas (MLRAs). Align to inventory method to account for amount of N (Right Rate) and management of N (Right Source, Right, Time, Right Place). 7

Copyright © Climate Check Corp. All Rights Reserved.Innovative Greenhouse Gas Management Solutions. Protocol Development — Schedule Q3/Q Supported by on-line solution to coordinate process. Structured and partly-automated online workflow management system for development of protocol Faster, easier, more reliable expert qualification for working groups. Standardized rules/procedures. Templates and workspace — what to do and how to do it. Justification and documentation for decisions. Working group task management, communication, approvals, glossary Structured and partly-automated online workflow management system for validation of protocol Automatically checks for completion of work. Validation by authorized expert panel. Community policing. Independent qualified validator. 8