ISO 14064 “Why Should You Care?”

Presented to ASQ-EED August 29, 2006

Russell ThorntonDNV Certification, Inc.

Contains Bonus Information-Comparison of U.S.A. GHG Registries/Programs

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Overview of ISO 14064-GHG Standard

Introduction

Development of ISO 14064- Overview

Description of 3 “Parts” and ISO 14064

Benefits to an organization

Appendix

Linkages to other tools and programs--BONUS

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Overview of ISO 14064-GHG Standard

“General process standards” that are GHG policy neutral;

Can be applied across organization and project types, sizes and sectors;

Involved a wide range of stakeholders;

Act as a common “building block” to initiatives or GHG programs;

Are auditable (ie, validation/verification).

Have widespread support - USA, EU, Japan, China, Brazil, India, … all approved

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Development of ISO-14064

ISO TC207 WG5 included roughly 175 experts from 45 countries and 23 liaison organizations.

Compatible with existing knowledge and approaches (WRI/WBCSD GHG Protocol; several national/regional programs)

GHG Protocol – Corporate Module was used as a primary seed document to ISO 14064 Part 1 (Inventories).

WRI/WBCSD staff and GHGP Revision Working Group members contributed to development of ISO 14064

ISO 14064 considered as the “what to do” and GHG Protocol considered as the “how to do it”

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The ISO 14064 GHG Standard

Organizations Greenhouse gases - Part 1: Specification with guidance at the organization level for quantification and reporting of greenhouse gas emissions and removals (ISO 14064-1).

Projects Greenhouse gases - Part 2: Specification with guidance at the project level for quantification, monitoring and reporting of greenhouse gas emission reductions and removal enhancements (ISO 14064-2).

Validation / Verification

Greenhouse gases - Part 3: Specification with guidance for the validation and verification of greenhouse gas assertions (ISO 14064-3).

Accreditation Greenhouse gases - Specification for greenhouse gas validation and verification bodies for use in accreditation and other forms of recognition (ISO 14065 DIS – work in progress).

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ISO 14064-Principles

Relevance

Completeness

Consistency

Accuracy

Transparency

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Part 1 – ISO 14064 Design and Develop Organizational GHG

Inventories

Part 1 – ISO 14064 Design and Develop Organizational GHG

Inventories

Part 3 – ISO 14064Part 3 – ISO 14064Verification

Process

ISO 14065Specifications for

Validation or Verification Bodies

ISO 14065Specifications for

Validation or Verification Bodies

Part 2 – ISO 14064 Design and

Implement GHG Projects

Part 2 – ISO 14064 Design and

Implement GHG Projects

GHG Inventory Documentation

and Reports

GHG Project Documentation

and Reports

Validation and Verification

Process

Level of assurance consistent with needs

of intended user

Conformance with applicable:

• GHG Program(s) – CCX, CCAR, US EPA Climate Leaders

• Legislation – federal, state/provincial, local

• Protocols/Standards – industry guidance (CCAP, IPIECA, etc.), the GHG Protocol, CDM, technical and safety standards/ codes, etc.

Verification of the GHG Assertion

Validation and/or Verification of the

GHG Assertion

Framework for ISO 14064 GHG Standards

Figure Copyright ISO (2006) – modified

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ISO 14064-Linkages

Relevant Legislation (eg, regulatory requirements)

The company should consider these linkages to plan and implement,

validate, verify, quantification, monitoring

and reporting documentation

Standard (ie, auditable general process requirements)ISO 14064

Relevant Standards (eg, recognized criteria, rules,

methodologies, equipment)

Applicable GHG Program/Registry (eg, additional requirements,

criteria, rules and policies) eg, CCX, CCAR,

US DOE 1605b, Canada, Australia,…

Good Practice Guidance (eg, recognized criteria,

methodologies, tools and guidance on how to do it)

eg, GHG Protocol, INGAA, IPIECA, API,

CAPP, GRI

Markets for GHG Units

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Why ISO 14064-Is GHG Management Important?

Are your key stakeholders interested/concerned about GHGs? (customers, investors, your BOD, etc.)

Does your organization have GHG risks & opportunities (major emission sources, duty of care) – brand/PR? compliance? competitiveness? physical?

Does your organization know:- GHG footprint? (facilities, main operations, products)- GHG reduction opportunities? (upgrades, new

technologies, offset projects, climate-friendly products)

Does your organization need to know how to manage GHG’s?

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General Benefits of ISO 14064

---- “Why Should You Care?”----

Enhance the credibility, consistency, and transparency of GHG accounting and reporting;

Increase investor confidence;

Facilitate the certification and trade of GHG emission reductions or removal enhancements;

Facilitate the development and implementation of organization GHG management strategies and plans;

Allow entities to track performance and progress in the reduction of GHG emissions and/or increase in GHG removals;

Assist in the identification of GHG risks or liabilities; and

Facilitate the development and implementation of GHG projects.

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Common issues to undertaking ISO 14064

What’s the business case? Why do it?

There’s still so much uncertainty about policies – how can I be sure what I’m doing is right?

What’s the incentive – what’s the return? (PR value, SRI premium, tradable GHG units, internal efficiencies – energy savings)

How much does it cost? (capital investment, O&M, FTEs)

How burdensome is this going to be?

Can your organization manage GHG’s?- have/need in-house capability (tools, training, GHG management

systems, verification) - Have the capability to plan, do/implement, report, manage a GHG

inventory or GHG projects?

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ISO 14064 Strategic Benefits

In the absence/uncertainty of government policies!The voluntary application of ISO 14064, together with good

practice guidance established for your sector:

Can help an organization to prepare and act and to provide you with the capabilities, information and systems for managing risks and creating value for your organization

And demonstrating/communicating with key stakeholders (customers, investors, general public)

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ISO 14064 Operational Benefits

1. Managing Risks

2. Public relations

3. Creating value from opportunity or threats

4. Compliance/Regulations

5. Investment disclosure

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ISO 14064-1:What’s a GHG Inventory?

ISO’s definition of a GHG Inventory: an organization’s GHG sources, sinks, emissions and removals

DNV’s definition of a GHG Inventory: The procedures, methodologies, data, information systems and reports associated with an organization’s quantification of GHG emissions and GHG removals.

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ISO 14064-Part 1: Organizations/InventoryScope, Definitions, Principles

GHG inventory design and development

Organizational boundaries

Operational boundaries

Quantification of GHG emissions and removals

GHG Inventory components

GHG emissions and removals

Organizational activities to reduce GHG emissions or increase GHG removals

Base year GHG inventory

GHG inventory quality management

GHG information management and monitoring

Document retention and record keeping

GHG reporting

GHG report planning

GHG report content

GHG report format

GHG report dissemination

Verification (Internal/1st party)

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ISO 14064-1 Benefits

Enables organizations to:

1. understand and quantify the GHG emissions for which they are responsible

2. focus on major GHG sources (priorities/risk)

3. prepare a verifiable, credible GHG emissions report

4. be compared with other organizations that use the same standard

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What is a GHG project?

GHG Project: activity or activities that alter the conditions identified in the baseline scenario which cause GHG emission reductions or removal enhancements. Requires the determination/justification of a baseline (reference case, hypothetical scenario)

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ISO 14064 - Part 2: Projects

Scope, Definitions, Principles

Introduction to GHG projects

Requirements for GHG projects

1. General requirements

2. Describing the project

3. Identifying GHG sources, sinks and reservoirs for the project

4. Determining the baseline scenario

5. Identifying GHG sources, sinks and reservoirs for the baseline scenario

6. Selecting GHG sources, sinks and reservoirs for regular monitoring and quantification

7. Quantifying greenhouse gases

8. Managing data quality

9. Monitoring the GHG project

10. Documenting the GHG project

11. Validating or verifying the GHG project (should)

12. Reporting the GHG project (should/shall)

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ISO 14064-2 Benefits

design project documentation to quantify, monitor and report GHG emission reductions and removal enhancements and manage GHG projects

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ISO 14064- Part 3

Establishes common principles/requirements for validation and verification

Competence, COI, ethical conduct

Validation/verification process

Level of assurance (scope, objectives, criteria, materiality)

Audit Methodology (plan, sampling, etc.)

Assessment criteria (systems, data, program criteria, etc.)

Validation/verification statement

Recordkeeping

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ISO 14064-3 Benefits

Validation and verification establishes credibility and trust.

ISO 14064 designed effectively for the needs of intended users, in accordance with specific level of assurance, criteria, scope, and goals/objectives

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