Practitioners Network “Thematic Group on Climate Change, Energy Efficiency and Renewable Energies” Carbon Footprint Methodologies for Development Projects and Case Studies March 2 nd, 2009 O. Grandvoinet C. Bernadac

Which methodologies, emission factors and tools do we use? Interactive presentation of the key calculations and assumptions How do we use the results? Which resources does our monitoring approach require? What were and are our most important challenges? Which type of coordinated action is most needed?

AFD case studies Combined Heat and Power: Carbon Footprint tool Urban transportation: ad-hoc method

Combined Heat and Power Description of project CHP in China  202 MW of electricity 2 x 76 MW gas turbines 50 MW steam turbine  120 t/h steam production Electricity production with combined cycle replaces coal consumption (~ t p.a.) Heat production replaces old coal boilers (~ t p.a.) Project cost: 106 M€  AFD’s financing: 40 M€ Project lifetime: 20 years

Mitigation and Carbon Footprint Calculation method years tCO 2 1. Construction emissions 2. Operation emissions 3. Reference scenario 4 4. Emission reductions per year Averaging over project lifetime...

Combined Heat and Power Reference scenario Here: quite straightforward  Coal consumption in current systems  Assumption: no increase in coal consumption More difficult cases (example of natural gas terminal)  Theoretical fuel switch (non existing clients)  Unmet demand  Generally conservative approach to avoided emissions

Combined Heat and Power Project emissions Construction emissions: considered as negligible Gas consumption per year: m 3 Figure used at AFD: including process (extraction, transport, refining)

Combined Heat and Power Baseline emissions No construction emissions: current systems Current coal consumption per year: t

Combined Heat and Power Avoided emissions

Combined Heat and Power Avoided emissions (variation)

AFD case studies Combined Heat and Power: Carbon Footprint tool Urban transportation: ad-hoc method

Urban transportation Description of project Subway in Cairo: 4 phases, from 2007 (construction of phase 1) to 2022 (operation of phase 4) Modal shift from road to subway Lifetime of project: 30 years (based on lifetime of equipment) Total cost: ~2 280 M€ Carbon footprint method not usable for this type of project Ad-hoc method: high number of hypotheses, numerous data needed

Urban transportation Hypotheses Construction emissions taken into account Energy consumption of subway constant over time (when finished) Energy savings due to modal shift constant over time Rebound effect of 1% per year: induced demand of 1% per year due to decongestion of roads.

Urban transportation Project emissions Construction emissions:  t of steel  t of cement  t gasoline  t oil Operation emissions:  MWh per year 2.1 M tCO tCO2

Urban transportation Modal shift In 2022, modal shift lowers petrol consumption by toe per year (traffic studies)  tCO2 avoided per year Decrease by 1% per year due to rebound effect Before 2022: avoided emissions proportional to length of subway

Urban transportation Avoided emissions Average emissions: tCO2/year Average avoided emissions due to modal shift: tCO2/year Avoided emissions: tCO2/year Ratio avoided emissions/project emissions ~3 Cost: ~125 €/tCO2 avoided

Carbon foot print lessons  Methodology more useful than result  Help decision making at the project design level … but co-benefits and induced / unquantifiable impacts  Value of intra-sector benchmark … with both energy (kWh) and carbon (CO2) footprint  Difficult inter-sector comparison /selection

Carbon footprint follow-up Direct & indirect project impacts tCO 2 avoided tCO 2 emitted Cost/Budgetary cost GDP Induced & leveraged impacts Pilot/replicable projects Public policies Induced & leveraged impacts Structural & long term effects  Building reference data by sector  Measurement of induced & leverage impacts CARBON FINANCE

Screening of climate change mitigation interventions Sector’s inertia and weight in terms of CO2 emissions Determinants of energetic change Leverage: promoters/investors, structural effects Maturity: public policies, existing projects, market Relevance of devlt. partner instruments Energy diagnostic: savings and substitution potential Intervention strategy maximising impact probability

Strategic planning tackling climate change  Integrate energy/carbon footprint criteria in urban and urban transport planning  Reinforce links between urban planning and development of integrated transport systems  Reduce demand for mobility / Less travel means less carbon, not less access  Leverage co-benefits (local environment, optimal dimensioning of investments, efficiency & attractiveness of city, social – access to transport solutions) AFD interventions  Soft components focused on climate change and at city policy design level  Holistic vs. urban transport project approach  Financing of priority investments as defined by strategic environmental planning  More to come : Curitiba, Brasilia, Rabat, Tshwane (Pretoria), Mumbai ? … Leveraging impact by thinking global and long term  Urban mobility Hanoi Guiyang

Additional comments Objectives: Improve coordination on:  Method  Tool  Emission factors  Perimeter Further work on additional areas:  Transport  Carbon sequestration (forest, soil)  Credit lines

How to « sell » an energy / climate approach?

Different logical framework  How to mobilize the local level for a global and long term issue? Linking global problematic and local concerns  Maximising co-benefits (climate / livelihoods / welfare) Linking long term and short term  Resilience to external shocks Examples Air pollution due to urban transport and emitting industry Natural resources management contributing to carbon sequestration and eco-services protection Electric sector : technical losses, demand side management => investment planning, auto-financing, tariff optimisation incl. social Getting prepared to a costly and scarce energy How to « sell » an energy / climate approach?