Carbon Footprint / Life Cycle Analysis September 29, 2009

Presentation Overview  Inventory Versus Footprint  Renewable Energy  Water Conservation  Absolute Versus Intensity Based Emissions  A Sustainability Life Cycle Model Concept

Inventory versus Footprint

Inventory Versus Footprint  Inventory: Assess the emissions being generated within the organizational boundary.  Footprint: Total Life-cycle GHG impacts of water supply, transport, treatment, and use.

Example: Inventory Versus Footprint Boundaries

Life Cycle Framework  Life Cycle Framework Can be Applied To: Operational carbon impacts associated with raw materials, water treatment, and water use Infrastructure development – tradeoffs between construction materials (embedded carbon), construction equipment, and facility operational emissions

Life Cycle Analysis – Operational Emissions  Life Cycle (Cradle-to-Grave) Impacts raw material extraction and transport product manufacture product distribution and use disposal/reuse/recycling  Analysis to determine benefits and tradeoffs between: Water Supply Sources Treatment Process Selection Treatment and Distribution System Design

Renewable Energy Discussions

Scope 1, 2, 3 Emissions  Inventory: Scope 1 Direct Emissions for all owned or controlled assets –Depending on organizational boundary approach Scope 2 Indirect: Most registries require these –May not be required in future cap-and-trade programs Scope 3 Indirect: Left to the discretion of the entity –Include activities directly related to the core business activities  Footprint: Add Scope 3 emissions to the extent that accurate data and accepted methodologies are available.

Water Utility Specific: Renewable Energy  Case 1: Water Utility Generates Green Power & Consumes it Internally Relevant to facilities to generate hydropower/renewable energy supply Satisfy internal electrical demands Zero Scope 1 GHG emissions Additional power purchased contributes to Scope 2 values.

Water Utility Specific: Renewable Energy  Case 2: Water utility generates green power & consumes it internally, sells Renewable Energy Credits RECs: renewable energy credits, similar to offsets, can be sold No additionality tests applied. Therefore, most existing protocols allow RECs to be applied to Scope 2 emissions only. Hydropower projects prior to 1997 do not qualify If an REC is sold to a purchaser, the seller cannot claim the same benefit Therefore if all the green power is “sold” as RECs, a water utility likely must claim Scope 2 emissions for the amount of power used

Water Utility Specific: Renewable Energy  Case 3: Water utility generates green power, sells it to an electric utility, utilizes grid power for other facilities RECs not sold to a third party. Green power sold to an electric utility Zero Scope 1 emissions to water utility If no claim to green power made by another party, might be able to claim as an offset to Scope 2 emissions from other grid power purchase Cannot be used to offset other Scope 1 emissions

Water Utility Specific: Renewable Energy  Case 4: Water utility generates green power, Sells it to an electric utility, Sells RECs, Utilizes grid power for other facilities Green power sold to an electric utility Zero Scope 1 emissions to water utility Another agency (electric utility or other) claims REC. Cannot claim as an offset to Scope 2 emissions from other grid power purchase Cannot be used to offset other Scope 1 emissions

Water Conservation

Water Utility Specific: Water Conservation Projects Potentially Four Entities with Affected Scope 1 and 2 Emissions: Water Utility –Reduced water transport and treatment needs Upstream Water Supplier Entity –Reduced pumping to utility requirements decreases electrical use Consumer –Reduced heating and/or pumping Electric Utility –Decrease in demand Who gets “credit” for decreases in emissions?

Water Utility Specific: Water Conservation Projects If contractual arrangements in place, utility may claim offsets against Scope 1,2 emissions Claim would require independent offset registration Likely, reductions attributable to Scope 3 emissions only (footprint, not inventory) Less likely, reduction of Scope 1 from electric utility could be applied to water utility’s Scope 1 emissions with prior agreement Conclusion: water conservation does not necessarily directly decrease a utility’s GHG inventory.

Absolute Versus Intensity Based Emissions  Absolute Vs. Intensity Based can mask or emphasize conservation projects  Example 1: Water Conservation leads to reductions in water pumping and treatment Decrease in Scope 1 and Scope 2 emissions Per gallon basis benefits are masked Report absolute emissions  Example 2: Consumer Demand Increases but Energy Efficiency programs and other emission reduction efforts Increase in absolute GHG emissions Per gallon benefits are emphasized Report Intensity-Based emissions

Sustainability Modeling: A concept

19 Sustainability Intelligence Portal (SI Port) Web-based technology to manage sustainability indicators during planning, construction and operations – GHG emissions: Scope 1, 2 and 3 – WTP and WWTP GHG Footprint – Waste management – Sustainable products and materials – Carbon Offsets – Social Sustainability Code of Conduct SI Port Dashboard

20 Carbon Footprint, not only Inventory  Scope 1 Emissions Mobile emissions Stationary combustion Fleet vehicles Process emissions  Scope 2 Emissions Electricity purchased  Scope 3 Emissions Public and private transportation Air travel Material use Waste Chemical use

GHG Emissions for Water Treatment Facilities  Scenario Planning : Construction Chemicals Energy Use  Plant Operations: Process Emissions Stationary Combustions Mobile Combustion Chemical Use

Questions?