Composting generates cash for greenhouse gas benefits

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Courtesy of BioCycle Magazine

Chicago Climate Exchange (CCX) recently finalized an initiative to develop a protocol for issuing offsets to projects that avoid greenhouse gas (GHG) emissions through composting or other similar approaches. This article explores the development of the new protocol, reviews its key attributes and describes how an entity can earn tradable credits for its GHG mitigation project.

In 1992, the U.S. ratified the United Nations Framework Convention on Climate Change (UNFCCC), which called for stabilizing GHG concentrations in the atmosphere at levels that prevent dangerous change and to allow for gradual adaptation to a changing climate. Since that time, U.S. annual GHG emissions have increased from 6 billion metric tons (1990) to over 7 billion (2007), a 17 percent increase. Of this amount, methane emissions from solid waste landfills accounted for a small but not insignificant portion: 149 million metric tons (2.4 percent of the total) in 1990 and 139 million metric tons (1.8 percent of the total) in 2007. The decrease in landfill methane emissions was largely driven by a continued increase in gas collection for regulatory compliance. Figure 1 illustrates total GHG emissions within the U.S. in 2007, with a more detailed section for generated methane.

To date, landfill gas capture and destruction, with or without utilization for energy production, has dominated the landscape as the primary project-based opportunity for reducing landfill methane emissions to the atmosphere. CCX developed its project qualification and quantification guideline “protocol” for carbon emission reduction credits from landfill gas systems in 2004; several institutions and programs have developed similar protocols.

These projects are relatively well accepted and represent a large share of registered GHG mitigation projects executed in the U.S. to date. Within the CCX program alone, over 5 million tons in carbon dioxide equivalent (CO2e) have been registered by project proponents, representing 7.4 percent of total registered project based emission reductions. Most notable has been the influx of capital to the waste management sector with the sole purpose of developing GHG projects at landfills. Rare is the waste management authority that has not been approached by some entity looking to capitalize on a latent GHG project.

Landfill gas capture and destruction projects are, however, not the extent of project related opportunities to reduce GHG emissions from the waste industry. There are numerous technologies and processes that reduce or avoid GHG emissions to the atmosphere, including technologies for recycling and composting.

CCX Protocol Development

CCX is an international rules-based GHG emission reduction, verification, registry and trading program based in the U.S. Launched as a pilot program in 2003, the CCX market now includes over 400 entities. CCX participants in the industrial, governmental and academic sectors execute legally binding commitments to meet annual emission reduction goals of 4 percent below baseline for 2006 and 6 percent below baseline by 2010. These annual reduction goals may be met by internal emission reductions, through trading of credits with members who make extra emission reductions, or by generating project-based emission mitigation credits (known as offsets). CCX rules require that all emission baselines, annual reduction commitments and offset projects are annually subjected to independent verification by CCX-authorized experts. The total included baseline emissions of CCX members is currently in excess of 600 million metric tons CO2, indicating that the U.S. has more GHG emissions under a legally binding cap than any other country in the world.

Every active or proposed GHG cap-and-trade program worldwide includes a role for project based emission reductions or offsets. Offsets are tradable certificates produced by implementing emission mitigation projects in sectors or activities not covered by an emissions cap or limit. Every GHG mitigation project enrolled in CCX must meet eligibility standards and undergo independent verification before it can be issued tradable offsets in the CCX Registry.

CCX, in cooperation with experts from the academic, industrial, government and nongovernmental sectors, has and continues to develop eligibility criteria for a variety of offset project types. CCX has prescribed eligibility, quantification and verification procedures for projects that: Capture or avoid methane emissions at landfills, coal mines and agricultural operations; Sequester carbon in soil under row crop, grass and ranch farming best management practices; Sequester carbon in forests and forest products; and Generate electricity without CO2 emissions. Methane emissions avoidance by composting is among the most recent protocols approved by CCX.

Offset Project Development Process

All CCX offsets projects must be evaluated and verified against the rules and methodologies approved by the CCX Offsets Committee. The Offsets Committee consists of individual representatives of CCX member companies, and typically incorporates expert input from a diverse range of sectors. It meets monthly to review new project applications and to consider enhancements to existing rules, as well as proposals for new offset project protocols. The process of developing a new protocol begins with a request for project approval. Where project types are scalable, measurable and ecologically desirable, the Offsets Committee will recommend the establishment of a subcommittee of technical experts who will work with CCX on the development of the sector specific protocol.

The protocol for avoided landfill methane emissions via practices such as composting was developed through this process. Based on the instigation of CCX staff and a request by the Offsets Committee, a group of technical experts was established to assist in developing the protocol. Participants in the subcommittee were: Sharad Deshpande (Chair) and Scott Subler, Environmental Credit Corp; Sally Brown, University of Washington; Jean Schwab, USEPA; Jim Warner and Gary Forster, Lancaster Solid Waste Authority; Brian Bahor, Covanta Energy; William R. Schubert, Waste Management; Robert Bylone, the Pennsylvania Recycling Markets Center; and Brenda Smyth, California Integrated Waste Management Board.

The protocol development began with an assessment of common practice in the industry to determine what practice and waste types should be addressed and eligible, and under what conditions. With that assessment the following was concluded: Nearly all food residuals generated in the U.S. are landfilled, with only about 2.2 percent diverted from landfills in 2006; A much higher proportion (62 percent) of the yard trimmings generated in the U.S. is currently being diverted from landfills (due largely to local and state bans on landfilling of yard trimmings); and, Approximately 55 percent of biosolids are land-applied for fertilizer value, with 15 percent incinerated and the remainder landfilled.

The technical subcommittee met almost a dozen times during 2008 and 2009, engaging in detailed discussion and debate on all aspects of the protocol, including items that are considered somewhat controversial in the solid waste industry. Key parameters of the carbon crediting protocol that were developed are shown in Table 1. Projects eligible under the new CCX protocol are defined as facilities that compost organic waste that would have otherwise been landfilled. The facilities prevent methane release from anaerobic degradation of the waste through aerobic treatment by composting. While CCX’s current project definition includes only aerobic composting processes, other projects using alternate process technologies such as the anaerobic digestion of organic wastes with methane capture would be eligible to earn offsets based on CCX quantification and eligibility criteria after the review and approval of project specific monitoring and verification procedures by the CCX Offset Committee. In terms of quantifying avoided landfill methane emissions, the CCX guidelines take a standardized approach for all projects by using a single activity baseline derived from estimates of landfill methane recovery averaged across all landfills in the U.S. The baseline emissions exclude methane emissions that would have to be captured and destroyed to comply with national, local or other legal requirements. Based on a schedule outlined in USEPA’s New Source Performance Standards for landfills, it is assumed that, on average (and considering that some landfills operate for extended periods without landfill gas collection), methane generated from a batch of waste deposited in a landfill is emitted unabated to the atmosphere (other than oxidation by the landfill cover) for up to 5 years from the time of deposition until captured by a gas collection system. Nonetheless, for the purpose of this protocol, it was conservatively assumed that methane generated from a batch of deposited waste is emitted unabated to the atmosphere for only 3 years. Additionally, the protocol conservatively assumed that the average recovery rate of methane generated from a batch of deposited waste is 75 percent from years 4 through 10.

Status of the protocol

Having been subjected to several rounds of review by the CCX Offsets Committee, the protocol was approved for use on April 17, 2009. The protocol will be posted on the CCX website for project owners to download and design their projects to meet the criteria, or institute measurement and monitoring changes that satisfy the requirement to ensure conformance going forward.

The first project to receive offsets for methane emission avoidance with CCX, in May 2009, was the Waste Options mixed waste composting operation on the Island of Nantucket, Massachusetts (see sidebar). In addition to meeting the protocol, the project was also reviewed by the Offsets Committee and CCX staff. The project is represented by Environmental Credit Corporation and was verified by Richardson Smith, Gardner and Associates.

Offsets projects can be registered at CCX directly by the project owner, or can be registered through a CCX-approved aggregator. In order to minimize transaction costs for small project providers, aggregators may serve as administrative agent for multiple small projects. Aggregators manage project documentation, arrange for independent verification by CCX-qualified entities, conduct market trades on behalf of project owners, and distribute sales proceeds to them. Entities wishing to register eligible offset projects with CCX must first qualify as a CCX Member, Offset Provider or Offset Aggregator.

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