Carbon cum Energy Audit Workshop Mr. Coleman Tse 27 Feb 2012

2 Talk Outline Part 1 – Carbon Audit Part 2 – Carbon Reduction Label Part 3 – HKQAA Background

Carbon Audit Part I

Introduction to: What is a “Carbon Audit”? Why should we do a “Carbon Audit”? How to do a “Carbon Audit”?

What is a Carbon Audit? A means of measuring (accounting or quantification) and recording (reporting) the Greenhouse Gases (GHGs) emissions of an organisation [in tonnes of Carbon Dioxide (CO 2 ) equivalent] Sometimes it is called a ‘Carbon Footprint’

Greenhouse Gases (GHGs) Gases that trap heat in the atmosphere Six internationally-recognized greenhouse gases regulated under the Kyoto Protocol: Carbon Dioxide (CO 2 ) Methane (CH 4 ) Nitrous Oxides (N 2 O) Hydrofluorocarbons (HFCs) Perfluorocarbons (PFCs) Sulfur hexafluoride (SF 6 )

Why should we do a Carbon Audit? Global Warming is being caused by GHGs Carbon Dioxide (CO 2 ) accounts for 84% of all GHGs

Greenhouse Gas Emission Source: Energy Information Administration, Washington D.C. United States

Why should we do a Carbon Audit? Kyoto Protocol (latest ratified by UN membership in 2007) establishes targets for industrialised nations to cut GHG emissions Industrialized countries to reduce their combined greenhouse gas emissions by at least 5% compared to 1990 levels by the period

Carbon Audit is the first step in developing strategies to manage and reduce GHG emissions of the organization Input for setting GHG target (emission reduction, some may lead to potential saving!) Demonstration of corporate social responsibility Meeting stakeholder expectation / brand value Why should we do a Carbon Audit?

How to do a Carbon Audit? 1. Define Organizational Boundary Decide “Where” to measure based on operations that a company legally owned or control Two main options for consolidating GHG emission Management Control Approach Account for all GHG emissions from facilities over which you have operational or financial control Operational control approach most accurately represents the emission sources that an organization can influence Wholly owning an operation, facility, building, process or project Having the full authority to introduce and implement operational policies Licence / contract to operate Equity Share Approach Account for GHG emissions in proportion to the % ownership over the facility

Reporting Emission under Management Control Approach & Equity Share Management ControlEquity Share Full ownership100% 30% owned with control of the facility (joint venture company) 100%30% 80% owned without control of the facility (joint venture company) 0%80% 0% owned, but operator of the facility (property management) 100%0% Not owned but have financial or operating lease 100%0% Fixed asset investment0%

How to do a Carbon Audit? 2. Define Geographical Boundary Physical location, area, services, facilities, e.g. site boundaries of building 3. Establish base year Set a base year to track emission trends Year in which Scope 1 & 2 data can be reliably collected Single base year Average of several year Rolling base year [the base year is always last year]

How to do a Carbon Audit? 4. Define Operational Boundary The specific activities that are components of GHG emission Scope of ControlGHG Sources 1 Direct emission from source owned or controlled by the organization Stationary source Process emission Mobile source Fugitive (leaks or venting) 2 Indirect emission from purchased electricity, gas, heating or cooling Purchased electricity Purchased gas 3 Other indirect emission which are consequences of an organization’s activities, but arise from sources that are owned or controlled by others (optional) Transport-related activities Outsourced activities Waste disposal

How to do a Carbon Audit? 5. Identify GHG Sources [Example: Connie Pizza & Noodle Shop] ScopeOperation Process / ActivitiesGHG Sources 1 (Direct)Stationary combustion Emergency generator set Boiler for steam generation Gas cooking stove CO 2, N 2 O Process emission Solid waste treatment (food waste / oil scum / sludge) CO 2, CH 4 Mobile combustion Motorcycle for food deliveryCO 2, N 2 O, CH 4 Fugitive emission Use of refrigerant in air conditioning unit Fire extinguishing equipment HFCs / PFCs 2 (Indirect)Electricity use Lighting / air conditioningElectricity consumption (CO 2 ) Towngas use Towngas for cooking & hot waterConsumption of Towngas (CO 2 ) 3 (other indirect) Paper use Manu, bills, leaflets, printed mattersCO 2

How to do a Carbon Audit? 6. Choosing Calculation Methodology Calculation-based approach : Emission = Consumption (activity) x Emission Factor Direct measurement of consumption Consumption mass balance: Total fuel used = (fuel purchased) + {(stock at beginning of year) – (stock at end of year)} Measurement-based approach Predictive emissions monitoring system Continuous emissions monitoring system

How to do a Carbon Audit? 7. Choosing Emission Factor (EF) & Global Warming Potential (GWP) Use default emission factors (EPD / IPCC) Fuel TypeEmission Factor (for stationary source)Unit Diesel2.641Kg CO 2 / Liter g CH 4 / Liter g N 2 O / Liter

Global Warming Potential Each GHG has a different ability to trap atmospheric heat, gases with high GWP trap heat better than gases with lower GWP GWP of CO2 is used as standard, other gases can be converted to carbon dioxide equivalent (CO2-e) units

How to do a Carbon Audit? 8. Collect Data Collect annual data for each of the activities defined: Amount of Oil / gas combusted, refrigerant leaked, petrol used for vehicles, annual kilowatt hour electricity consumed, etc. Receipts & bills, Purchasing records Measurement data e.g. flow meter, level gauge Maintenance records e.g. replenishment Inventory Monitoring records e.g. discharge concentration

How to do a Carbon Audit? 9. Calculate Emission: Diesel used for boiler = 5000L [CO 2 Emission (tons)]: 5000 (L) x Emission Factor (kg CO 2 /L = 2.641) x 0.001(ton/kg) = 13.2 [CH 4 Emission (tons)]: 5000 (L) x Emission Factor (g CH 4 /L = ) x (ton/g) = [N 2 O Emission (tons)] 5000 (L) x Emission Factor (g N 2 O/L= ) x (ton/g) = Converting to CO 2 equivalent: CH 4 Emission (tons) x GWP = CH 4 Emissions (tons CO 2 equivalent) x 21 = N 2 O Emission (tons) x GWP = N 2 O Emission (ton CO 2 equivalent) x 310 = Total Emission (tons CO 2 equivalent) = = 13.21

10. Develop GHG Inventory [ Connie Pizza & Noodle Shop] Source / Calculation Methodology Emission factorActivity data requiredGHG emissionGHG Emission (CO 2 equivalent) Diesel use for boiler [consumption (L) x EF] CO 2 = (kg/L) CH 4 = (g/L) N 2 O = (g/L) Fuel supplier invoice from Jan to Dec 2008 Diesel tank level record from 1 Jan & 31 Dec 08 Spillage record in L used Gas use for cooking [consumption (unit) x EF] CO 2 = (kg/unit) CH 4 = (g/unit) N 2 O = (g/unit) Towngas bill from Jan – Dec 08 Gas leakage report in units used [0.0013x21] + [ x 310] Leakage of refrigerant (R-407C) [leakage (kg) x GWP] Purchase record 2008 Disposal record Maintenance record (before/after) New equipment filling record – 27– 632 = 9Kg leakage 9 x 1526 = 13734Kg = 13.7 ton 13.7 Fuel use for motorcycle [ Petrol (L) x EF] CO 2 = 2.36 (kg/L) CH 4 = 1.422(g/L) N 2 O = 0.046(g/L) Petrol invoice from oil company of L petrol used [0.017x21]+[ x310] 28.9 Electricity = KWh Towngas = unit 0.7 Kg CO 2 / KWh 0.6 Kg CO 2 / unit Electricity bill (2008) Towngas bill (2008) Total (ton)175.88

How to do a Carbon Audit? 11. Reporting Tota l GHG emissions Our total carbon footprint for 2008 is tonnes CO2e Carbon value per employee (per job / project / department) This equates to 11.8 tonnes per full time equivalent staff member Power used per square foot (offices) Benchmark results inter- and intra-industry

GHG Target GHG target is a planning tool to drive GHG reduction Examples from corporations: PolaroidReduce CO 2 emissions 20% below its 1994 emissions by year-end 2005; 25% by 2010 ShellManage GHG emissions at 5% or more below 1990 baseline by 2010 IntelReduce PFCs by 10% from 1995 levels by 2010 CLPA reduction in the CO2 intensity from 0.84kg CO 2 /kWh (as at 30 June 2007) to 0.2kg CO 2 /kWh by 2050 Johnson & Johnson Reduce GHGs 7% from 1990 levels by 2010

GHG Target Our target for 2009 is to reduce our carbon footprint by 5% as compare 2008 Actions planned include: Understanding how to obtain the greatest energy efficiency from our kitchen and dinning hall ( re- commissioned HVAC systems, window replacement for better insulation, photo voltaic installation) Increasing our efforts to encourage maximum recycling and energy saving by staff Investigating whether it is feasible to compost our food waste.

GHG Removal One acre of trees removes up to 2.6 tons of carbon dioxide each year. International Society of Arboriculture

Carbon Management begins with Carbon Audit Wal-Mart found that its biggest emissions were from refrigeration of transport fleet Walkers found that the biggest part of its crisps’ carbon footprint is the fertiliser farmers use to grow potatoes Brewer Adnams discovered that processing a bottle accounts for the biggest chunk of CO2.

References World Resources Institute & World Business Council for Sustainable Development, The Greenhouse Gas Protocol – A Corporate Accounting and Reporting Standard The Climate Registry, General Reporting Protocol, 2008 Intergovermental Panel on Climate Change (IPCC), 2006 IPCC Guidelines for National Greenhouse Gas Inventories ISO :2006 Greenhouse Gases - Part 1: Specification with Guidance at the Organization Level for Quantification and Reporting of Greenhouse Gas Emissions and Removals

Carbon Reduction Label 2.

Carbon Reduction Label Helps companies communicate their reduction achievement on GHG emission Allows an organization to demonstrate its commitment to manage and reduce GHG emission The rich picture shown below is a simple representatio n of ways that we can reduce our carbon footprint. Draw your own version which shows how you could reduce your carbon footprint. Include drawings for each of the key words. Complete the table first (see next page) as this will help you develop symbols/pict ures for each of the keywords. The attempt the rich picture. Pictures are an essential part of a rich picture. Draw a symbol/pictur e (rough version) to represent each of the keywords listed below. Each symbol/pictur e can be drawn alongside the key words in the table below. When you are happy with each design, transfer it accurately to your rich picture.

Carbon Reduction Label Conduct carbon audit – base year Implement GHG reduction programs Conduct carbon audit – current year Measure reduction results

Carbon Reduction Label Self assessment Verification and confirm measurement by HKQAA Award of label

Carbon Reduction Label Application – organization, buildings, products, projects, processes Measure, Reduce and Communicate

Carbon Reduction Label Act as the bridge between carbon conscious organizations and their stakeholders

3. HKQAA Background

HKQAA Background A non-profit independent Conformity Assessment Body (CAB), incorporated by Hong Kong Government Industry Department in 1989 as a company limited by guarantee A leading CAB in Hong Kong that providing manday services per year With over 3800 system certificates spanning over various industries & accounted for more than 50% of market share Headquarter in HK, with offices in Guangzhou, Shanghai and Suzhou, and with representatives in US and UK Operation in China approved by Certification and Accreditation Administration of the People’s Republic of China (CNCA)

Organization & Management Direct & monitor by the Governing Council that is formed by 22 reputable leaders in different sectors, such as government, buyers, suppliers, trade association, academics and professional institutions

Contribution to Society Established HKQAA-BCS Fund (Business and Community Supporting Fund) - $10 million Funding to support the University research of best practice of management system Advisory role to Government in product certification & related regulation Setup Eco-manufacturing Resources Centre & Food Safety Resources Centre to support industry for meeting green manufacturing & food safety requirements Annual symposium, conference and seminar Provide input to support 6 pillars initiatives of HKSAR Government Assist HKSAR Government to develop assessment standard for Red Wine Storage certification scheme Organizing Quality Building Award (QBA) Supporting the annual OHS awards that organizing by OHS Council

Contribution to Society Participation in charity works HKQAA-BCS Fund to support the University research

Contribution to Society Sponsor to HK Eco- Products Award Support Quality Building Award

Contribution to Society Co-organize with Government and other public bodies to organize symposiums and seminars

Contribution to Society Different symposiums for sharing

Contribution to Society Co-operate with cooperates to promote the management systems

Our Clients Public Sectors Utility Sectors

Our Clients Private Sectors

The End Thank you !