EU ETS Aviation Greenhouse Gas Emissions Verification

Who are we?

 Founded in 1878  A global leader and innovator in inspection, verification, testing and certification services  Recognized as the global benchmark for quality and integrity  Around 59,000 skilled employees  A network of more than 1,000 offices and laboratories around the world. More than 30 offices/labs across India  Carries out activities across a wide range of sectors: Agriculture, Automotive, Consumer testing, Environment, Governments& Institutions, Industrial, Life sciences, Minerals, Oil, gas & Chemicals, Systems & certification Services

A Hallmark of Leadership
More than 60,000 customers More than 20 Years of experience

Climate Change Programme  A global leader in the verification of greenhouse gas emissions.
Accredited by more than 40 national & international accreditation bodies 2400 Qualified auditors

 A series of services addressing mandatory & voluntary reporting of greenhouse gas emissions

Carrying out world wide operations

A wide range of certification & auditing solutions

Climate Change Programme

EU ETS

CDM

UK ETS

Voluntary Markets

ISO 14064

EU ETS Aviation

Carbon Neutrality Label

PAS 2050

UK CRC
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What is EU ETS?
 Started in 2005, the EU ETS is a compulsory cap and trade system.  The cap is the total amount of emission allowances to be issued for a given year under the EU ETS. Since, each allowance represents the right to emit 1 tonne of CO2 - or an amount of another greenhouse gas giving the same contribution to global warming as 1 tonne of CO2 - the total number of allowances, i.e. the cap, determines the maximum amount of emissions possible under the EU ETS.  Each EU Member assigns a competent authority (CA) for itself.  Participants must design a monitoring plan (MP) as per the guidelines published by European Commission (EC) for monitoring and reporting of greenhouse gases.  The monitoring plan must be submitted to the CA for approval.  Participants must monitor emissions from included activities as per the approved MP & submit a third party verified annual emissions report to the CA.  Participants must then surrender allowances equivalent to their verified annual emissions.

Inclusion of Aviation in EU ETS

 Nov, 2008: Inclusion of aviation sector in EU ETS  Jan, 2012: Emissions from all domestic and international flights from or to anywhere in the world that arrive at or depart from an EU airport will be covered by the EU ETS  CO2 emissions from the entire flight will be covered, including CO2 emitted in non-EU airspace.  Calculation of CO2 emissions: y CO2 emissions = Fuel consumption x emission factor  EU based airline operators regulated by their state,  Non-EU based airline regulated by a member state where they have the most traffic in the base year.  In 2009, EC published a list of aircraft operators specifying their administering member states. Updated each year by 1 Feb.

What does it mean for the operators?

 Airline operators need to:
y monitor emissions from 1st Jan, 2010 & submit their 1st verified annual emissions report to their CA by 31st March, 2011. y apply for free allowances by submitting verified 2010 tonne-kilometre benchmark data to their CA.

 Monitoring & submission of verified reports to be done annually from 2010  At the end of the year if an operator does not have enough allowances to cover their annual CO2 emissions it will need to buy more  Failure to surrender enough allowances will result in a civil penalty in the form of 100 Euros per allowance  Surplus allowances can be either sold in the market or banked for covering future emissions

What is the scope?

 All flights, whether EU- or foreign-based, starting from or terminating at an aerodrome in a Member State of the Community are covered by the scheme:
Flights within a Member State Flights between Member States Flights between a Member State and third country

 Annex I of the directive mentions the aviation activities covered by EU ETS  It does not include the following flights:
Subsequent flights after first landing in third country (e.g. Vilnius Shanghai /Shanghai Tokyo) Flight sections within/between third countries before direct flight into EU (e.g. Hong Kong Bangkok / Bangkok Vilnius)

Are there any exemptions?

 Certain aviation activities enlisted in the Annex I to the Directive are exempt from the scope. Those include:
Flights for the transport of the reigning Monarchs, their families, Heads of State, Heads of Government and Government Ministers Military, customs and police flights Search, rescue, fire-fighting flights; humanitarian flights and emergency medical service flights Flights performed under visual flight rules Round flights Training flights Flights for purpose of scientific research Flights performed by aircraft with maximum take-off mass of less than 5,700 kg Flights performed by commercial aircraft operators, falling under the de-minimis rule

What is de minimis threshold?

 Commercial aircraft operators only are exempt from the scheme when at least one of the following thresholds applies:
fewer than 243 flights per period for three consecutive four-months periods within a calendar year (Jan-Apr; May-Aug; Sept-Dec) annual total CO2 emissions of less than 10 000 tons

 Definition of commercial operators as per EU ETS:

an operator that, for remuneration, provides scheduled or non-scheduled air transport services to the public for the carriage of passengers, freight or mail All commercial air transport operators must hold an air operators certificate (AOC) under Part I of Annex 6 to the Chicago Convention. Operators without such a certificate are not commercial air transport operators. However, operators that do not hold AOC, may still be able to demonstrate their commercial status through equivalent certification

 The thresholds are applied solely to the flights within the EU and between EU and third countries.  No de minimis threshold for the private jets
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Who qualifies as a small emitter?

 Small Emitters are non-commercial aircraft operators who operate:
fewer than 243 flights per four-month period for three consecutive periods (Jan-Apr, May-Aug, Sept-Dec); OR flights with total annual fossil CO2 emissions of less than 10,000 tonnes per year.

 Small emitters are eligible to use a simplified method to determine their fuel consumption for EU ETS monitoring and reporting purposes, as specified in the Monitoring and Reporting Guidelines.

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Measuring the Emissions

 CO2 emissions from aviation activities shall be calculated using the formula:
CO2 emissions = Fuel consumption x emission factor

 Fuel consumption for each flight, each type of fuel and by the auxiliary power units to be monitored  Use of standard emission factors, e.g.:
EF (Jet kerosene) = 3.15 t CO2/t

 The amount of aviation activity to be calculated in tonne-kilometre using the following formula:
Tonne-kilometres = distance payload Distance = Great circle distance (GCD) between the aerodrome of departure and the aerodrome of arrival + 95 kms Payload = total mass of freight, mail and passengers carried

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Timeline to be followed
31 Aug 2009

Submission of a monitoring plan (MP) to the Competent authority (CA)

31 Dec CA approves MP 2009

2010

Monitoring in 2010 as per the approved MP

Submission of verified report for free allowances for the 1st & the 31 nd March, 2 trading periods 2011
30 June, 2011 30 Sept, 2011

Submission of all the valid applications to EC by CA

Benchmark, the number of free allowances, allowances for auction and special reserve decided by EC

28 Feb, CA issues free allowances to each aircraft operator 2012 30 April, 2013

Surrender of allowances equivalent to the verified emissions by the operators

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Penalty for Non-Compliance

 Failure to surrender adequate number of allowances calls for a penalty of 100 Euros per tonne of CO2 equivalent emitted  Failure to get the benchmark tonne-kilometre data verified could prevent an operator from receiving free emissions allowances. Operators then need to purchase allowances on the open market, the current price of which is approx. 14 per tonne.  Failure of enforcement measures to ensure compliance may lead to an operating ban on that operator

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Why choose SGS for verification?

 More than 200 experienced greenhouse gas assessors globally  A member of the IATA & actively participated in working groups on the inclusion of aviation in the EU ETS organized by the EC, the European Accreditation forum (EA) & the International Emissions Trading Association (IETA).  More than 200 experienced greenhouse gas assessors globally  Vast experience in EU ETS : verification of more than 450 installations done  Awarded best verifier EU ETS 2006 & 2007 by Environmental Finance  As part of its risk minimisation approach, SGS offers a split verification service: y an initial assessment of compliance is carried out during the monitoring year with final data verification occurring prior to reporting deadlines.

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Experience speaks!
Symbolic of its vast experience is the vast list of its renowned clients:

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Time is running out! Get verified!

Puneet Kumar Asst. Manager Climate Change Programme (ME & SEAP) SGS India Private Limited
Phone: +91 124-6776445 Mobile: +91 9871002381 Email: puneet.kumar@sgs.com Website: http://www.climatechange.sgs.com/home_climatechange_v2/eu -ets-and-aviation-climatechange.htm
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