Carbon Farming Initiative workshop: from Plan to Practice - - PowerPoint PPT Presentation

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Carbon Farming Initiative workshop: from Plan to Practice

Piggeries: destruction of methane generated from manure 2013

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Welcome

• Introductions
• Housekeeping

Workshop purpose

• support your participation
• help you to understand

what’s involved

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Introduction

• Understand Clean Energy Regulator’s role
• Understand key concepts behind Carbon Farming

Initiative’s operation

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Clean Energy Regulator

Our vision is to support Australia in transitioning to a low carbon economy through an informed and efficient market for carbon and investment in renewable energy.

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Three government

• rganisations have a role

in the Carbon Farming Initiative

Department of Industry: Development of policy, legislation and methodologies Clean Energy Regulator: Assessment of projects, education, issue of Australian carbon credit units Department of Agriculture, Fisheries and Forestry: Provides information and support for landholders and funds research

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Australian Government response to Climate Change

• International: Kyoto

Agreement

• Domestic: Reduction in

greenhouse gas pollution using the market

» Carbon pricing mechanism

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How the Carbon Farming Initiative works

• You can earn Australian carbon credit units (ACCUs) by:

» storing carbon, or » reducing greenhouse gas emissions on the land

• 1 ACCU = 1 tonne of carbon dioxide equivalent (CO2-e)

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Methodology determinations Set out the rules for undertaking a specific activity to earn Australian carbon credit units

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Industry perspective: Australian Pork Limited

• Pork’s carbon footprint
• Opportunities for the pork industry

Janine Price, Manager Environment and Climate Change, Australian Pork Limited Sam Lawrence, Senior Policy Analyst, Australian Pork Limited

AUSTRALIAN PORK LIMITED

The Carbon Farming Initiative: From Plan to Practice

Sam Lawrence Janine Price Senior Policy Analyst Manager, Environment

APL and the Australian pork industry

APL

• Australian Pork Limited (APL) is the peak national representative body for Australian

pig producers.

• It is a producer-owned not-for-profit company combining marketing, export

development, research & innovation and strategic policy development to assist in securing a profitable and sustainable future for the Australian pork industry.

Cost of production

• Cost of production for Australian pork is high. - ie labour, feed grain, energy
• Subsidisation in export markets.

Over the last three years electricity prices have risen by: QLD 35.8% NSW 40.2% NT 27.3% WA 26.5% TAS 29.2% SA 25.2% ACT 33.0%

Source: www.dme.qld.gov.au

Pork’s carbon footprint

• Livestock accounts for 66% of Aust. agriculture’s greenhouse gas (GHG)

emissions, which amounts to approx 16% of Australia’s total GHG emissions.

• Pork production represents just 0.4% of livestock greenhouse gas

emissions.

• Most of our emissions (nearly 70%) come from the effluent system. This offers a

significant opportunity to reduce.

Garnaut, 2008

Pork’s carbon footprint

Treatments for capturing and destroying CH4:

• Covered Anaerobic ponds

(CAPs) with flaring (CAP-F)

• Methane for heat to offset

farm gas use (CAP – G)

• Combined heat & power

generation on farm (CAP- CHP)

• Transporting effluent off site

to a centralised anaerobic digestion plant (CAD)

Greenhouse gas emissions from four alternative effluent treatment systems for a simplified piggery system

Wiedemann et al, 2012

• A recent APL funded project analysed these options and showed that emissions from

effluent treatment may be reduced by 62-80%.

• Potential to have the lowest GWP for pork production worldwide.
• Significant opportunity to reduce ecological footprint, reduce energy inputs, differentiate our

product and promote the industry’s environmental credentials.

The Carbon Farming Initiative

Opportunities

Example

• A 5000 standard production unit (SPU) piggery would produce ≈103,500m3 of

methane per year, (≈1556t CO2 equivalent per year).

• With CFI credits of approximately $16/T, at $2.45 per finished pig @ 9900 pigs =

$24,255 per year.

• The Carbon Farming (CFI) is a carbon offsets scheme that allows pig farmers to

earn carbon credits by reducing GHG emissions

• APL provided input into policy and legislation. Worked in partnership with

Government- CER, DCCEE, DAFF

• The Aust. Pork industry was the first Industry to have a methodology endorsed and

approved by government – “Destruction of methane generated from manure in piggeries” - Developed by APL, DCCEE and industry experts.

• Second methodology recently approved for biodigesters
• Other opportunities for reduction of GHG

CFI: Case Study

Blantyre farms

• Blantyre Farms (Young, NSW) was the first

piggery in Aust. to secure approval to participate in the CFI scheme.

• With 22,000 pigs, Blantyre Farms installed a

biogas system to generate electricity from manure by covering an effluent pond - powers the entire farm

• The owners, no longer pay $15,000 a month

for electricity and gas, but earn $5,000 a month from the power sold back to the electricity grid.

• Blantyre Farms generates CFI credits and

renewable energy certificates from the project.

APL and the Pork CRC

APL

• APL priorities continue to focus on GHG mitigation on-farm.
• There are several projects, including covered ponds and the Biogas Code.
• The National Agricultural Manure Management Program (NAMMP) is worth $6.19m

(with $2.97m from DAFF) with other RDCs to address knowledge gaps leading to further CFI methodologies for producers. Pork CRC

• The bio-energy support program offers free advice for producers.
• Dr Stephan Tait – University of Queensland Ph: 0466 699 817.
• NAMMP is currently running a project on solid manure in anaerobic digesters.

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Guide to undertaking a piggeries – destruction of methane generated from manure project

• Support your decision to participate in the Carbon

Farming Initiative, using the piggeries methodology

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What does a piggery project look like?

• Manure treated in a covered pond
• Pond contains only manure from
• perations of piggery sheds
• Gas from the covered pond is

collected and combusted: » Flare » Electricity generation system » Gas boiler

• Use PigBal model to calculate

carbon abatement.

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Why participate?

• Capturing emissions from effluent ponds has several

benefits

• Earn Australian carbon credit units (ACCUs) and sell

these for a financial benefit

• Watch the video at:

http://www.cleanenergyfuture.gov.au/video/grantham- piggery/

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How do I get started?

• Check your eligibility
• Assess the feasibility
• Check your expectation for return on investment
• Decide on your business model
• Apply:

» Recognised Offsets Entity » ANREU account » Eligible Offsets project

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How do I undertake a piggery project?

• Meet eligibility requirements

» Flare » Electricity generation » Gas boiler

• Maintain your equipment
• Measure inputs to PigBal

PigBal Model is a computer program that predicts piggery manure

• production. Model inputs include daily herd information, weekly.

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Project boundary

• Baseline:

» Greenhouse gas emissions from treatment pond (methane - CH4)

• Project activity:

» Electricity from the grid, fuel used for gas capture and combustion (CO2, N20, CH4) » Gas capture and combustion (N20, CH4)

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Measure and calculate abatement

• Baseline calculation
• Greenhouse gas

abatement calculation

• Monitor
• Use PigBal

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Monitoring and record keeping

• Project information
• Combustion device

information

• Monitoring and gas

composition information

• Direct and indirect

measurement (inputs and outputs from PigBal)

• Other records

Quality assurance and control matters

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More on record keeping Monitoring data is crucial to your application for

• ACCUs. Will you be able

to protect your data in an unforseen event?

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Audit report Provides a ‘reasonable assurance’ opinion on whether or not your project complies with the methodology determination and Carbon Farming legislation.

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Apply for carbon credits

• Submit offsets report and audit report to the Clean

Energy Regulator

• Australian carbon credit units (ACCUs) are issued into

your account in the Registry

• Earn money by selling the ACCUs and transferring them

to another account in the Registry

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Question and Answer panel

• Introduction to Carbon Farming Initiative and Clean

Energy Regulator

• Australian Pork Limited
• What does a project look like?
• Measure and calculate abatement
• Audit

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Case Study: Technical Aspects of a Piggery Biogas project

Stephan Tait, University of Queensland and Pork CRC

Technical aspects of a Piggery Biogas Project

Roseworthy 7 June 2013 Pork CRC Bioenergy Support Program Stephan Tait, PhD, CEng(IChemE)

http://porkcrc.com.au/research/program-4/bio-energy-support- program/

This presentation is provided for general information purposes and should NOT be used as a substitute for professional advice.

Outline:

• Why can burning of piggery biogas produce carbon credits?
• What equipment do you need for a piggery project?
• What does the equipment cost?
• Where are the greatest returns?
• Some tips…

Biogas =

65-70% methane (natural gas) 30-35% CO2

Where do the carbon credits come from?

Methane (in biogas) Carbon dioxide + Energy

Air

25x impact 1x impact carbon credit

Biogas to Carbon Credits

Capture the gas

Biogas covers

Biogas covers

Biogas flaring

NAO UV Pilot Monitors* Sentinel*

Biogas flaring

*Manufacturers or suppliers for which photos of infrastructure are shown are neither endorsed nor

• recommended. Photos are only

shown for illustrative purposes.

FM *Flow meter shows how much methane is being sent to the flare to be burnt *Temperature probe or UV sensor confirms that the flare is actually operational and is burning the methane sent to it

Biogas flaring

Skerman et al, RIRDC, 2012

Biogas heating

Skerman and Collman, RIRDC, 2012

Biogas heating

Power generation

Methane (in biogas) Energy

Air

Electricity

Skerman and Collman, RIRDC, 2012

Biogas cleaning

400-500 sow $200-300k 4-5 year payback 1000-1500 sow $400-600k 3-5 year payback <400 sow <$200k 5+ year payback 2000 sow+ $1000k+ 2-3 year payback

How much does it cost?* What are the potential returns?*

*indicative only, based on projects to date, can be substantially different and should be assessed on a site-by-site basis. Not to be interpreted as financial advice.

10% 9% 27% 31% 9% 3% 10% Combined Heat and Power - Capital Cost Spread*

Solids separation/Screening Pond earthworks Cover and piping (biogas/sludge) Generator unit and electricals Biogas clean-up and blower Biogas flare Project delivery costs + compliance

*indicative only, based on projects to date, can be substantially different and should be assessed on a site-by-site basis. Not to be interpreted as financial advice.

29% 6% 53% 12%

Biogas returns – Breakdown*

ACCUs (CFI) LGCs (RECs) Fuel + Grid power use onsite Electricity Export

*indicative only, based on projects to date, can be substantially different and should be assessed on a site-by-site basis. Not to be interpreted as financial advice.

3.5km major public road crossing

Breeder pigs Low manure volumes High energy demand for heating (lamps)

Grower-finisher High manure volumes Minimal energy requirements

• Tom Smith (Kia-ora)
• Ian Connaughton (Don KRC)
• Ken Cameron (Cameron Pastoral)
• Edwina and Michael Beveridge (Blantyre Farms)
• Eugene McGahan (FSA – Pork CRC Feasibility studies)
• Alan Skerman, (DEEDI QLD
• Stephan Heubeck (NIWA)
• Janine Price/Rob Wilson (APL, Pork CRC)
• Dr. Sasha Jenkins, UWA
• Mark Hogan/Ian Longfield, Rivalea
• Grant Skilton, Aurere Farms
• Hugh Payne, DAFWA, Medina
• Steve Lepper, NZ
• Abre de Villiers

Contributors

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Administration: working with the Clean Energy Regulator

• Understand three key administrative steps involved

with Carbon Farming Initiative projects.

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Three important parts to your Carbon Farming Initiative administration

• 1. Recognised Offsets

Entity

• 2. Eligible Offsets

Project

• 3. Certificate of

Entitlement Download application forms from the Clean Energy Regulator web site. There are no application fees.

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Recognised Offsets Entity

• Essential to be part of the

Carbon Farming Initiative and issued with Australian carbon credit units

• Open an ANREU Account

» fit and proper person test » proof of identity test

• Centrally processed, case
• fficer allocated

Tip: call us before you submit your application to make sure it’s all in order: (02) 6159 3434

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Eligible Offsets Project

• Sets out your plan to implement a Carbon Farming

Project.

• Checked by the Clean Energy Regulator to make sure

your plans meet the Carbon Farming Initiative rules.

• Processed by Carbon Farming team, new case officer.

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Eligible Offsets Projects: Q10: Project start date If backdating, confirm project operating with project requirements the whole time period

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Eligible Offsets Projects: Q12: Project description Address all project eligibility points identified in s2.1 of the methodology determination

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Eligible Offsets Projects: Q25: Legal right

• Land title
• Licence
• Contracts

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Certificate of Entitlement and offsets report

• Applications for Australian

carbon credit units are made at the same time as you submit your offsets and audit reports.

• You can choose when to

report and apply for credits, within the one to five year period.

• Good record keeping is

essential to your report and audit.

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Summary: three important parts to your administration

• 1. Recognised Offsets

Entity

• 2. Eligible Offsets

Project

• 3. Certificate of

Entitlement

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Carbon Markets and feasibility

• Understand the basics of ACCU markets to enable you

to ask questions of your advisors

• Provide you with tips to consider when undertaking your

feasibility

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Types of markets

• ACCUs are personal property and can be traded.
• Two key markets:
• Domestic compliance market
• Voluntary market

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Selling ACCUs

• Compliance market - pay attention

to: » Carbon pricing mechanism in fixed price period (to 2015) » Market for European Union Allowances (after 2015)

• Voluntary market – pay attention to:

» Charisma of your project

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Who can help?

• Seek advice from an Australian Financial Services

Licence holder

• Consider these resources:

» Your normal bank and/or broker » Carbon Markets Institute: CFI hub » Liable Entities Public Information Database (LEPID)

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Project feasibility

• 1. Financial feasibility
• Know the costs and

benefits

• Cash flow
• Scenario analysis
• 2. Commercial feasibility
• Kyoto or Non-Kyoto ACCUs?
• Number ACCUs estimated?
• Timeline to deliver ACCUs?

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Project feasibility

• 3. Methodology
• Can you meet the rules for

eligibility and data capture as described in an approved methodology determination?

• 4. Regulatory Feasibility
• Methodology available?
• In Australia?
• Required by law?
• Legal right?

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Project feasibility

• 5. Legal feasibility
• Pass tests to open ANREU account?
• Legal right to carry out project?
• 6. Organisational capabilities
• Own and operate?
• Engage third parties? (aggregator, broker, cooperative)

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Question and Answer panel

• Case Study
• Administration: three key steps when working with

the Clean Energy Regulator

• Carbon market and project feasibility

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Thank you

Evaluation forms

More Information

• Online: www.cleanenergyregulator.gov.au
• Phone: 1300 553 542
• Email: CFI@cleanenergyregulator.gov.au
• Watch the webinar