• The GHG Protocol Corporate Accounting and Reporting Standard (“Corporate Standard”) provides standards, guidance, and web-based calculation tools to help companies, regulators and others develop an organizational-wide greenhouse gas emissions inventory.
• The GHG Protocol for Project Accounting (“Project Protocol”) contains requirements and guidance for quantifying reductions from greenhouse gas mitigation projects; for example, those used to offset emissions or to generate credits in trading programs.
The two modules help companies and others identify, report, and reduce greenhouse gas emissions. They also provide the core measurement building blocks needed to underpin market-based policies on climate change. Ensuring consistent accounting and reporting practices between different companies, states, and countries will reduce the transaction costs for business, improve the quality of greenhouse gas information and ensure greater compatibility between different climate initiatives, including trading schemes, and registries.
The GHG Project Protocol
The Project Protocol is a generic tool for determining the greenhouse gas emission reduction benefits of climate change mitigation projects. Its objectives are to:
• provide a credible and transparent approach for quantifying and reporting GHG emission reductions or removals from projects;
• enhance the credibility of project GHG accounting through the application of common accounting concepts, procedures, and principles; and
• provide a platform for harmonization among different project-based GHG initiatives and programs.
The key to quantifying GHG emission reductions is identifying a credible baseline against which they can be calculated. The Project Protocol describes in detail how to estimate baseline emissions for projects, using either a project-specific analysis of baseline alternatives, or by developing GHG-emission “performance standard” for particular types of activities. The Protocol also contains guidance on assessing the unintended effects of a project on GHG emissions (sometimes called “leakage”), monitoring project performance, and publicly reporting GHG reductions.
Guidance for Electricity Sector Projects
Over 2006, two supplements to the Project Protocol have been developed providing guidance for GHG projects in specific sectors. The first supplement covers land use, land use change, and forestry projects. This supplement was published in November 2006. The second supplement covers how to estimate emission reductions from projects that displace or avoid electricity generation from grid-based power plants. This supplement is nearing completion and will be published in the first quarter of 2007.
Grid electricity projects can include renewable energy projects that provide emissions-free electricity in place of fossil fuels, or projects that reduce demand for grid electricity and thus avoid fossil fuel emissions. The complex nature of power grid operations can make estimating a project’s effect on GHG emissions a challenging task. The Project Protocol guidelines will explain how to identify the emissions baseline for a particular project, and how to estimate a project’s impact on the operation of existing power sources (also called the “operating margin”) as well as its impact on the construction of new generation capacity (also called the “build margin”). Both effects are taken into account in determining the project’s total emission reductions.
The guidelines can be used to estimate the GHG emission reductions that result from energy efficiency projects, and a chapter of the guidelines is devoted to how the Project Protocol can be used alongside existing energy efficiency protocols like the IPMVP. For more information, please contact Derik Broekhoff of the World Resources Institute at dbroekhoff@wri.org.
Further information on the GHG Protocol Initiative is available at www.ghgprotocol.org, including free downloads of both the GHG Protocol Corporate Standard and Project Protocol.