CCS under the CDM – update of progress and issues Grant A. Kirkman Team Leader | CDM Methodologies Carbon Capture and Sequestration Tuesday, 14: :45 Carbon Forum America February , 2008 San Francisco, CA United Nations Framework Convention on Climate Change

COP/MOP EB UNFCCC secretariat SSCWGA/RWG MPAP RIT DOE superviseselects accreditssupports recommends supports approves supports recommends CDM Regulatory Bodies| the basics

CDM Project Cycle| flow

CDM the largest CO2 offset system in the world –> 948 projects registered to date –49 countries –192,724,874 certified emission reductions (CERs) issued –approx. additional 3000 projects in pipeline –2.7 billion CERs expected to end of 2012 The mechanism has a legal basis in the Kyoto Protocol –Regulated by an Executive Board (EB) answerable to KP Parties –EB back-stopped by UNFCCC secretariat with support for: Registration of projects & issuance of CERs Accreditation of third-party validators Methodologies for project emission reductions, baselines & monitoring CDM | global reach, international mandate

CDM projects that entered pipeline in 2006 are expected to result in $ 25 billion in capital investment (almost double the 14 billion USD in total investment leveraged through GEF in the climate change area since it started) CDM renewable energy & energy efficiency projects registered in 2006 are expected to result in ca. $ 6 billion in capital investment (about triple the ODA support for energy policy and renewable energy projects in the same countries. Almost as much as private investment in renewable energy and energy efficiency (USD 6.5 billion in 2006) in the same countries) Condensed from the report of the CDM Executive Board to the COP/MOP 2007, page 4. CDM general overview | investment, financial flows

SBSTA : workshop on CCS as CDM project activity – boundary, permanence & leakage CMP.2: considered the public call, workshop report & EB recommendation of proposed methodologies – laid out a road map to CMP.4 EB to continue to consider proposals for geological storage – approve only after guidance from CMP Encouraged Parties, intergovernmental organizations, non-governmental organizations and others to organize global and regional workshops Parties considered inputs from IGOs, NGOs & Parties, at SBSTA 27, on: 1. Long-term physical leakage (seepage) levels of risks and uncertainty; 2. Project boundary issues (such as reservoirs in international waters, several projects using one reservoir) and projects involving more than one country (projects that cross national boundaries); 3. Long-term responsibility for monitoring the reservoir and any remediation measures that may be necessary after the end of the crediting period; 4. Long-term liability for storage sites; 5. Accounting options for any long-term seepage from reservoirs; 6. Criteria and steps for the selection of suitable storage sites with respect to the potential for release of greenhouse gases; 7. Potential leakage paths and site characteristics and monitoring methodologies for physical leakage (seepage) from the storage site and related infrastructure for example, transportation; 8. Operation of reservoirs (for example, well-sealing and abandonment procedures),dynamics of carbon dioxide distribution within the reservoir and remediation issues; 9. Any other relevant matters, including environmental impacts; Consider a synthesis report at SBSTA-28 and another at SBSTA-29 recommended to CMP.3 (Bali) with a view to a decision at CMP.4 in Poland (end 2008). CCS under the CDM | decisions & timelines

CCS under the CDM | views Parties, IGO/NGO s Fourteen (14) submissions –6 from Parties (Japan, Saudi Arabia, Canada, Norway, EU and Korea) –8 from intergovernmental and non-governmental organizations (Greenpeace, WWF, Bellonas, NFED, WCI, IRGC, IPIECA and IETA) Highlight technical, methodological, legal & policy issues related to the consideration of CCS as CMD project activities. Technical views expressed: –CCS is feasible in a range of different storage types –potential leakage pathways are identifiable –remediation of sites is important –environmental impacts should include assessment of purity & effects on benthic organisms Methodological issues, –a range of criteria and steps for site selection are outlined –reservoir numerical simulation modelling will be a critical element –project boundaries can be defined by emission sources –2006 IPCC Guidelines for National GHG Inventories provide a useful basis for monitoring methodologies for leakage caused by /seepage from reservoirs Legal Issues expressed: –2006 IPCC Guidelines provide useful guidance for cross-border CCS projects –long-term liability could by a seller/host country liability model Policy Issues expressed: –some consensus that CERs from CCS projects should be equal to other CERs –some NGOs proposed that alternative mechanisms –no major issues or consensus where identified for acceptable levels of risk or uncertainty

Summary of 2 large scale proposed methodologies White Tiger Field (Vietnam) NM0167 Petronas (Malaysia) NM0168 DescriptionCO 2 capture from NGCC plants, pipeline transport, storage in offshore/ onshore oil field, EOR CO 2 and H 2 S co-capture from offshore gas well, storage in aquifer, no EOR Project boundary Capture, compression, transport & storage reservoir Compression, transport, storage reservoir LeakagePipeline leakage identifiedNo leakage identified Seepage levels 0.7% p.a. during crediting period, model based very likely < 1% in 100 yrs, model based Monitoring3D & 4D seismic3D seismic Pre-projectSeawater EORNo EOR Site Selection Criteria Defined by IEA publication on CCSDefined by IPCC special report on CCS Permanence d Permanence a > threshold, replace with other units Beyond scope of methodology, but continue monitoring PP s replace the CER s Discount factor for 1000 yr. prediction

Summary of the small scale proposed methodology Anthropogenic Ocean Sequestration by Alkalinity Shift (SSC_049) DescriptionDissolving concentrated CO2 (power station flue gas) in sea water & neutralising the carbonic acid formed with calcium carbonate. The process stores carbon in the form of bicarbonate. Project boundaryCapture, compression, transport. Excludes power station flue & limestone transport LeakageNo leakage identified SeepageNot discussed MonitoringMonitoring of energy consumption & alkaline change Pre-projectNot discussed Site Selection Criteria Not discussed PermanenceNot discussed

CDM website: CDM Bazaar: Catalogue of decisions (beta): CDM UNFCCC website: cdm.unfccc.int UNEP RISOE: Links | thank you