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Developments in USEPA’s Mandatory GHG Reporting

Developments in USEPA’s Mandatory GHG Reporting. Presentation for Northeast Gas Association 1 March 2011. About ERM. Leading global provider of environmental, health and safety, risk, and social consulting services Privately held company in business for over 39 years

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Developments in USEPA’s Mandatory GHG Reporting

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  1. Developments in USEPA’s Mandatory GHG Reporting Presentation for Northeast Gas Association 1 March 2011

  2. About ERM • Leading global provider of environmental, health and safety, risk, and social consulting services • Privately held company in business for over 39 years • Over 3,600 professionals in 130 offices in more than 40 countries • We focus on delivering favorable business outcomes for our clients • Support the development and implementation of sustainability strategies and programs

  3. Agenda • Overview of EPA’s Greenhouse Gas Mandatory Reporting Rule • Focus on applicable Subparts, including recently finalized Subpart W for Natural Gas Systems • Summary of e-GGRT Process and Status • Roadmap to Reporting GHG’s

  4. Mandatory Reporting Rule, Let’s Summarize… 2nd EPA Proposed rule for Mandatory GHG Reporting 12 Apr 2010 EPA Proposed rule for Mandatory GHG Reporting 10 Apr 2009 EPA Final rule for “2010 reporters” (40 CFR Part 98) 30 Oct 2009 EPA Final rule for “2011 reporters” (Subparts W, DD) 30 Nov 2010 2010 Reporters Submit Certificate of Representation 30 Jan 2011 2011 Reporters Submit Certificate of Representation 30 Jan 2012 2009 2010 2011 2012 TODAY 2010 Reporters First Report to EPA 31 Mar 2011 Monitoring Plans due for 2011 Reporters 1 Apr 2011 2011 Reporters First Report to EPA 31 Mar 2012 2010 Reporters Begin data collection 01 Jan 2010 2011 Reporters Begin data collection 01 Jan 2011 Monitoring Plans due for 2010 Reporters 1 Apr 2010

  5. What’s Different?Voluntary reporting vs. EPA rule Facility Scope 1 Stationary Combustion Other GHG Sources* Fossil Fuel Stationary Combustion Vents, Fugitives, etc. * Biogenic Stationary Combustion EPA Rule Coverage *covered by EPA rule Landfill Mobile Sources Refrigerant Emissions WWTU Scope 2 Electricity Scope 3 Other Indirect Sources

  6. Applicability Thresholds

  7. Monitoring Plan – Required under all Subparts • Monitoring Plan Requirements • Positions of responsibility for data collection • Process used to collect GHG data • Procedures for quality assurance, maintenance, • and repair of meters and instrumentation • Can refer to other documents • Changes in monitoring, QA, maintenance • Maintenance records for all instrumentation and flow meters • Kept onsite & in place by April 1, 2010 or April 2011

  8. Subpart C – Stationary fuel combustion sources • Broad definition of Source Category: devices that combust solid, liquid, or gaseous fuel to either: • Produce electricity, steam, heat, or other useful energy; or reduce the volume of combustible matter • Note 1: does not include portable equipment, emergency equipment, flares (unless covered in other subparts), and hazardous waste combustion (unless co-fire listed fuel) • What GHGs are covered: CO2, CH4, N2O from each fuel combustion unit • Report separately for each fuel using emission factors • Aggregation of combustion sources using common fuel is allowed, but units > 250 MMBtu/hr must be broken out separately • Monitoring Plan complete by April 1, 2010 • First report to EPA due March 31, 2011

  9. Subpart NN • Requires annual reporting of: • Gas received at city gate stations • Volume placed into storage • LNG produced • LNG sent to distribution • Gas received from local producers • Gas delivered to transmission pipelines or other LDCs • Gas delivered to each customer using >460 million scf/yr (incl. customer name, address, etc.) • CO2 emissions resulting from combustion of all gas sold to end users that consume <460 million scf/yr • What GHGs are covered: CO2, CH4, N2O • Monitoring Plan complete by April 1, 2010 • First report to EPA due March 31, 2011

  10. FACILITIES REGULATED BY SUBPART W Underground Natural Gas Storage Offshore Oil & Natural Gas Production Natural Gas Distribution Onshore Natural Gas Processing Plants Onshore Natural Gas Transmission Compression Petroleum systems downstream of production (not regulated) Onshore Oil & Natural Gas Production NGL systems downstream of processing plants (not regulated) LNG Import and Export Equipment LNG Storage

  11. Subpart W – Natural Gas Distribution & LNG Storage Applicability Determination • For Natural Gas distribution companies, the 25,000 MT CO2e per year threshold applies to the entire distribution system operated by a Local Distribution Company (LDC). • Distribution pipelines, metering & regulating stations, and fuel combustion equipment except boilers and heaters with heat input ≤ 5 MMBtu/hr • For LNG Storage, the 25,000 MT CO2e per year threshold applies to each stand-alone above ground facility • Compressor fugitives, fuel combustion equipment • Would any utility scale LNG storage locations exceed 25,000 MT CO2e/yr? Not likely unless already triggering reporting for combustion equipment.

  12. Subpart W • Natural Gas companies are required to quantify emissions from M& R stations. • LNG storage facilities must report compressor fugitives. • Both LDC and LNG storage must report fugitive emissions from valves, pump seals, connectors, etc. and emissions from combustion equipment. • What GHGs are covered: CO2, CH4, N2O • Monitoring Plan complete by April 1, 2011 • First report to EPA due March 31, 2012

  13. Applicability threshold based on system-wide emissions Annual leak screening for fugitives at custody transfer M&R using: optical gas imaging camera; or USEPA Method 21 The annual measurements are used to create a company specific emission factor that is then multiplied by the number of above-ground M&R stations that are not custody transfer stations. Emission factors are used to estimate leaks from underground stations, pipelines, and service lines. Are baseline emissions known? Willfacilities have to follow first year requirements to confirm applicability or non-applicability? Is Method 21 used? Can current practices be adapted to align with this Method? Is training in place? Will the “company-specific emission factor” from city gate stations result in gross overestimation of emissions from other M&R stations? Are population counts available and up-to-date? Issues and Uncertainties Is there sufficient information on collecting, quality assuring, and managing data to draft a GHG Monitoring Plan by April 1?

  14. Electronic Reporting • All reporting under the GHG Reporting Program will be electronic. • Registration completed • Full reporting tool expected this month??? • EPA’s Electronic Greenhouse Gas Reporting Tool (e-GGRT) is under development. • Web-based system for facility/supplier to EPA reporting • Web-forms will guide reporters through data entry and submission • Built-in emissions calculations • Will include a mechanism to submit file directly using Extensible Markup Language (XML) format

  15. e-GGRT Flowchart for Registration

  16. What should 2011 Reporters be doing now ? • Identify roles and responsibilities (designated representative and agents) • Conduct employee training for data collection, sign-off, and reporting • Submit Certification of Representation • Identify gaps in managing inventory • Conduct applicability analysis • Identify equipment/testing needs 2011 Reporters First Report to EPA 2010 2011 2012 • Create Monitoring plan with data collection procedures and training requirements • Schedule initial leak survey • Conduct annual leak survey • Set up system to calculate emissions and manage recordkeeping with change log • Attempt to emulate report requirements specified in regulations

  17. 2010 Reporters - ROADMAP TO COMPLIANCE Step 1 – Prepare Tools • Prepare calculation tool • Identify roles/responsibilities • Procedures for review and sign off • Training for team and management Jan 2011 Mar 31, 2011 Dec2010 Feb 2011 Mar 2011

  18. 2010 Reporters – ROADMAP TO COMPLIANCE • Step 1 – Prepare Tools • Prepare calculation tool • Procedures for review and sign off Training for team and management • Step 2 – Review and Update • Review rule changes • Update Monitoring Plan • Perform readiness review Jan 2011 Mar 31, 2011 Dec2010 Feb 2011 Mar 2011

  19. Watch for Updates! http://www.epa.gov/climatechange/emissions/ghgrulemaking.html

  20. 2010 Reporters – ROADMAP TO COMPLIANCE • Step 1 – Prepare Tools • Prepare calculation tool • Identify roles/responsibilities • Procedures for review and sign off Training for team and management Step 3 – Start Using e-GGRT • Submit paper Electronic Signature Agreement • Register Designated Representative, users, agents (before Jan. 30th) • Attend EPA e-GGRT training • Get familiar with reporting functions when the full online tool is available • Step 2 – Review and Update • Review 2010 rule changes • Perform readiness review • Update Monitoring Plan Jan 2011 Mar 31, 2011 Dec2010 Feb 2011 Mar 2011

  21. 2010 Reporters - ROADMAP TO COMPLIANCE • Step 3 – Start Using e-GGRT • Submit paper Electronic Signature Agreement • Register Designated Representative, users, agents (before Jan. 30th) • Attend EPA e-GGRT training • Get familiar with reporting functions when the full online tool is available • Step 1 – Prepare Tools • Prepare calculation tool • Identify roles/responsibilities • Procedures for review and sign off Training for team and management Step 4 – Compile Report and Submit • Fuel consumption, CEM data, carbon content, molecular weight, HHV data, etc., etc., as applicable • Run through calculations • Brief management and obtain certification authority • Load e-GGRT • Step 2 – Review and Update • Review 2010 rule changes • Perform readiness review • Update Monitoring Plan Jan 2011 Mar 31, 2011 Dec2010 Feb 2011 Mar 2011

  22. Take-aways • EPA has created a new greenhouse gas reporting program that differs considerably from existing voluntary programs • The EPA Mandatory reporting rule is prescriptive in terms of scope, QA/QC requirements, calculation methodology, and reporting format • Like other EPA programs, the GHG Reporting Rule has an enforcement element – companies must be in full compliance within the mandated timeframes • Companies must prepare now: • Identify team members for reporting responsibility • Train personnel in data collection, QA/QC, reporting • Establish internal schedules to ensure compliance

  23. Questions? Toby Hannatoby.hanna@erm.comPeter Anderson peter.anderson@erm.com

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