CCS under the CDM – update of progress and issues Grant A. Kirkman

1. CCS under the CDM – update of progress and issues Grant A. Kirkman Team Leader |CDM Methodologies Carbon Capture and Sequestration Tuesday, 14:45 - 15:45 Carbon Forum AmericaFebruary 26 - 27, 2008San Francisco, CA United Nations Framework Convention on Climate Change

2. CDM Regulatory Bodies|the basics COP/MOP approves supports elects supervises accredits supports recommends EB RIT MP AP DOE UNFCCC secretariat A/RWG SSCWG supports recommends

3. CDM Project Cycle|flow

4. CDM | global reach, international mandate • 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

5. CDM general overview| investment, financial flows • 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 inca. $ 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 <http://unfccc.int/resource/docs/2007/cmp3/eng/03p01.pdf>, page 4.

6. CCS under the CDM |decisions & timelines • SBSTA 24 2006: 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: • Long-term physical leakage (seepage) levels of risks and uncertainty; • 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); • Long-term responsibility for monitoring the reservoir and any remediation measures that may be necessary after the end of the crediting period; • Long-term liability for storage sites; • Accounting options for any long-term seepage from reservoirs; • Criteria and steps for the selection of suitable storage sites with respect to the potential for release of greenhouse gases; • Potential leakage paths and site characteristics and monitoring methodologies for physical leakage (seepage) from the storage site and related infrastructure for example, transportation; • Operation of reservoirs (for example, well-sealing and abandonment procedures),dynamics of carbon dioxide distribution within the reservoir and remediation issues; • 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).

7. 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

8. Summary of 2 large scale proposed methodologies

9. Summary of the small scale proposed methodology

10. www.cdmbazaar.net

11. Links|thank you CDM website: http://cdm.unfccc.int CDM Bazaar: http://www.cdmbazaar.net Catalogue of decisions (beta): http://test.cdmis.net/catalogue-test CDM UNFCCC website: cdm.unfccc.int UNEP RISOE: http://cdmpipeline.org