Climate Change Leadership Forum report number: 2

Update on the International Carbon Action Partnership (ICAP)

Briefing for the Climate Change Leadership Forum

Prepared by the Emissions Trading Group
Date: 16 June 2008

Developments since last report (21 February 2008)

Public Conference on Monitoring Reporting, Verification and Compliance

  1. ICAP held a public workshop on the implications of monitoring, reporting, verification, compliance and enforcement (MRVC&E) for linking of emissions trading schemes in Brussels on 19 and 20 May, with meetings of ICAP members and the ICAP Steering Committee afterwards.
  2. The workshop sessions included:
    • Technical aspects of measurement and calculation of emissions
    • The significance of monitoring capabilities to decide the scope of the carbon market
    • Experience with verification, inspections and enforcement to ensure compliance
    • Reporting emissions data in a global carbon market – including frequently of release of emissions data and precautions taken to deal with market sensitive data.
  3. New Zealand was represented at the workshop and ICAP meetings by Leah Murphy from the Emissions Trading Group/MOT.  Leah presented on MRV in the NZ ETS and also participated in panel discussions for the first workshop session.
  4. Participants were largely EU based, although there were also participants from the US (representing the Environmental Protection Agency, the Regional Greenhouse Gas Initiative, the Western States Climate Initiative)  British Colombia,  Japan and Australia.  A number of participants were curious about aspects of the New Zealand scheme that are different from the EU ETS approach and expressed some concerns about these differences. These included:
    • Upstream versus downstream points of obligation
    • inclusion of agriculture and forestry due to perceived difficulty in emissions measurement and high levels of uncertainty
    • lack of 3rd party verification of annual emissions returns prior to their submission to government
    • lack of public availability of emissions data down to facility or in our case participant level
  5. During the course of the conference, some of these issues were resolved, in that, a general view that upstream vs downstream points of obligation would not result in technical barriers to linking as long as other criteria were met regarding how emissions are monitored. A view that other different approaches may also lead to this conclusion was expressed.  An understanding was established that more work is needed to understand what are the key elements of MRVC&E that would be needed for different schemes to link, especially where different approaches are used.
  6. Leah will also be a member of the ICAP review panel that drafts a report of conference outcomes. This will be important to address any misconceptions about the NZ scheme and to help shape how different approaches to emissions trading schemes generically get characterised.
  7. The ICAP agreed to investigate a report on barriers to linking in the area of MRVC&E, which would likely mean employing a consultant(s).  New Zealand will consider putting forward some consultants’ for this task. 

Australia and New Zealand Business and Climate Change Conference

  1. ICAP will not be able to provide any representative in person for the Climate Change and Business Conference.  Accordingly officials do not consider that it is appropriate for there to be an ICAP hosted session at the conference, although Australian and New Zealand officials attending could speak about ICAP if desired.

Upcoming ICAP events

  1. The next ICAP public workshop is to be on auctioning and is planned for October or November in New York.  The conference may be scheduled around the time of the Carbon Market Insights Americas conference in Washington on 12-14 November to encourage wider participation in the workshop.  A closed workshop on allocation is planned alongside the workshop on auctioning.