SCTP Module 2: Carbon and Environmental Systems Management (PDF)

Carbon and Environmental Systems Management and the Future for Renewable Energies GoImpact Capital Partners 2024 1 Mapping Climate, Carbon and Environmental Systems into the Future Mapping the Climate Change Challenge in Singapore Greenhouse Gases (GHG) & Their...

Carbon and Environmental Systems Management and the Future for Renewable Energies GoImpact Capital Partners 2024 1 Mapping Climate, Carbon and Environmental Systems into the Future Mapping the Climate Change Challenge in Singapore Greenhouse Gases (GHG) & Their Relation to Climate Change Introduction to Scope 1, 2 & 3 Carbon Emissions Regulatory Landscape of GHG Renewable Energy 2 Mapping the Climate Change Challenge in Singapore 3 Mapping Climate, Carbon and Environmental Systems into the Future Understanding Environmental Management Systems Measuring, Monitoring & Reducing Your Environmental Impact Carbon and Renewable Energy Credit Markets Quiz 4 Third National Climate Change Study Why should we care about climate change? Follow the Centre for Climate Research Singapore studies. EP A Learn more from National Environment Agency. 5  Impacts and Drivers of Climate Change EP A 6 Impacts of Climate Change on Health Climate change is a significant health crisis causing immediate problems like malnutrition, respiratory and cardiovascular diseases, and increased risk of infectious diseases due to contaminated resources. Long-term effects include mental health issues such as anxiety, depression, and post-traumatic stress disorder, exacerbated by the stress and trauma of climate-related disasters and displacements. It also deteriorates critical health determinants like air and water quality, leading to chronic diseases and stunted development in children. 7 Source: World Economic Forum 2024 How Extreme Weather Impacts Health Climate change is a significant public health crisis, often underestimated. Its effects exacerbate various health issues like respiratory illnesses and vector-borne diseases. Climate impacts can also weaken essential health and societal infrastructure needed to treat vulnerable populations. 8 Source: The Geneva Association 2024 Impact of Higher Wet-bulb Globe Temperatures Health Risks: High WBGTs, which measure heat and humidity, significantly increase the risk of heat-related illnesses. Expanding Indoor Impact: Rising WBGTs are now posing risks not just outdoors but also indoors, affecting workplaces, homes, and public spaces that lack effective temperature control. The lethal wet-bulb temperature varies depending on humidity levels, but they occur where the human body cannot cool effectively, leading to hyperthermia, regardless of hydration or rest. 9 Source: MSCI ESG Research Sustainability and Climate Trends 2024 What is the dangerous level of WBGT? Black zones represent dangerous levels of WBGT where a prolonged period of 6 hours of more can lead to death from hyperthermia. Check out https://www.wbgt.sg/#chart for WBGT readings in Singapore on a real-time basis Source: Lee Wee Leong, WBGT.SG 10  Safety and Health Regulations Temperature Regulations: In Singapore, the temperature in any working chamber, man-lock, or medical lock at worksites must not exceed 29°C, per the Workplace Safety and Health (Construction) Regulations 2007. Acclimatization Programmes: Singapore's Occupational Safety and Health legislation includes specific protective measures such as acclimatization programmes. These programmes are designed to help workers adapt to hot environments, reducing the risk of heat illness by enhancing the body's ability to handle heat stress. Indoor Air Quality Control: Legislation often targets the prevention of air pollution in indoor work environments by enforcing adequate ventilation systems to maintain healthy air quality. 11 Source: International Labour Organization 2024  Safety and Health Regulations Heat Stress Management: The Workplace Safety and Health Council in Singapore provides resources and guidelines on managing heat stress. Haze Protection Guidelines: The Ministry of Manpower offers guidelines and advisories to protect employees from the effects of haze. These guidelines are not prescriptive but focus on practical measures employers can take. Employers are encouraged to train their workers to recognize the symptoms of heat-related illnesses, such as heat stroke, heat exhaustion, and dehydration, and to take immediate action to prevent serious health outcomes. It is recommended that employers provide readily accessible drinking water at work sites to ensure that workers stay hydrated throughout their shifts. 12 Source: International Labour Organization 2024 Think Moment! Answer the following questions: 1. How well do you feel you understand the issue of climate change? Where do you usually get your information from? 2. Have you noticed any recent changes in the local environment in your neighborhood that might be related to climate change? 3. What actions do you think you can take to combat climate change? 13  Greenhouse Gases (GHG) & Their Relation to Climate Change 14  15 Source: Climate Reality Project  How Greenhouse Gases Warm Our Planet CO2 is only one of the greenhouse gases. Methane, Nitrous Oxide and Fluorinated gases also contribute to global warming. EP A 16 Source: IPCC AR 6 (2022) How Greenhouse Gases Warm Our Planet Note the global warming potential for Methane, NO2 and Fluorinated gases is much higher than CO2. 1 tonne of Methane = ~ 30 tonnes of CO2e 1 tonne of NO2 = ~300 tonnes of CO2e 1 tonne of SF6 = ~23,500 tonnes of CO2e 17 Main Sources of GHGs GHG Type Carbon Dioxide (CO2) Methane (CH4) Nitrous Oxide (N2O) Fluorinated Gases (HFC, PFC, NF3, SF6) How is it generated? Transportation – Agriculture – rumination of Agriculture – fertilizers, Refrigerants – air combustion of fossil fuels livestock manure management conditioning systems Electricity – combustion of Land Use, Land-use Change Fuel Combustion – Aerosol propellants – spray fossil fuels and Forestry (LULUCF) depending on type of fuel cans, solvents, fire burnt retardants, foam blowing agents Industry – combustion of Energy and Industry – Industry – byproduct of Industry – byproduct of fossil fuels natural gas processing and chemicals such as nitric aluminum production and transmission, coal mining acid (commercial fertilizer) semiconductor and adipic acid (nylon), manufacture semiconductor manufacturing Waste – generated from Waste – wastewater Electricity transmission – landfills, wastewater treatment during SF6 is used as insulation, treatment, decomposition nitrification and including circuit breakers denitrification of nitrogen present Lifetime in Atmosphere Thousands of years 12 years 114 years Up to 50,000 years for PFC 18  Energy use is by far the greatest contributor to global greenhouse gases EP A 19 Source: Energy Industry Review Other Sources of GHGs Peace is a prerequisite for solving climate-related issues. The optional reporting results in missing data, creating a 'military emissions gap'. EP A 20 Are GHG emissions coming down? The pandemic “blip” has since been reversed, and more. EP A 21 Fossil Fuel Subsidies Fossil fuel subsidies are government measures to artificially lower the price of oil, coal, or natural gas. Types of Fossil Fuel Subsidies: Production subsidies - tax breaks or direct payments that reduce the cost of producing fossil fuels Consumption subsidies - energy price cuts for consumers, such as setting fixed prices at petrol stations 22  Governments spend US $423 billion annually supporting fossil fuels 23 Source: UNDP 2021 Group Exercise: Fossil Fuel Subsidy Reallocation Do you know how much Singapore relies on fossil fuels? According to the report Powering the World (Utility Bidder 2024), Singapore relies on one fossil fuel for 73% of its energy supply, but this time, it's oil. Dubbed the "undisputed oil hub in Asia," Singapore produces 27,621 ktoe (kilotonnes of oil equivalent) and is home to major oil companies such as Exxon Mobil. Break into your groups. Track fossil-fuel subsidies (https://fossilfuelsubsidytracker.org/). Choose Singapore data and consider the level of subsidies provided for end-use electricity. Discuss how Singapore can reduce these subsidies and what policies might work. 24  Fossil Fuel Subsidy Reallocation Do you know what your money does in your bank accounts? Read more from Project Drawdown and reconsider your investment style: Jamie Beck Alexander, Paul Moinester, and Julian Kraus-Polk (2023). Saving (For) The Planet: The Climate Power of Personal Banking. 25 Source: Project Drawdown Labs, 2023  Under current policy regimes, we will not meet the 1.5 degree target 26 Source: UNDP, 2021 Summary Global warming is caused by greenhouse gas emissions A greenhouse gas is any gaseous compound that absorbs infrared radiation The main GHGs are carbon dioxide, methane and nitrous oxide Global warming is caused by human activities and is causing climate change Despite assurances to the contrary, fossil fuel consumption is only going up Fossil fuel subsidies are increasing the rate of global warming 27 Introduction to Scope 1, 2 & 3 Carbon Emissions 28 Basic Definitions - Carbon What? In climate change discussions, "carbon" often refers to carbon dioxide, the main greenhouse gas humans release into the atmosphere. In the case of Carbon Neutrality, you do not necessarily reduce your carbon emissions as long as you can purchase carbon offsets. Compare this to Net Zero Emissions, where you actively try to reduce your GHG emissions as much as possible with carbon offsetting as the last resort. 29 Greenhouse Gases: Scope 1, 2 & 3 Emissions Greenhouse gas emissions are categorized into three groups or 'Scopes' by the most widely-used international accounting tool, the Greenhouse Gas (GHG) Protocol. 30 Greenhouse Gases: Scope 1, 2 & 3 Emissions 31 Greenhouse Gases: Scope 1, 2 & 3 Emissions Carbon Neutral Target Scope 1 and 2 emissions are mandatory. Scope 3 emissions are encouraged, and may be mandatory for some industries… but how scope 3 emissions should be calculated are often left to the reporting organisation to decide. Net Zero Target Scope 1, 2 and 3 emissions are mandatory. But… how scope 3 emissions are calculated are often left to the reporting organisation to decide. SBTi Target Almost all (95%) Scope 1 and 2 emissions should be covered under the targets. Scope 3 emissions should be included if it accounts for more than 40% of total emissions. Reporting is typically done in tonnes / CO2e (carbon dioxide equivalent) Note 1 tonne CH4 = ~ 30 tonnes CO2, 1 tonne NO2 = ~ 300 tonnes CO2. Therefore 1 tonne CH4 = ~ 30 tonnes CO2e 32 Ambition levels Principle 1 Principle 2 Principle 3 Consistent with no net accumulation of GHGs in the atmosphere Consistent with the attainment of the Paris Agreement and the SDGs Business model is resilient in a net zero economy Carbon Neutral SBTi Net Zero Scope 1, Scope 2 and Scope 3 Aim for below 2-degree Aim for below 2-degree (encouraged) Celsius or 1.5 degree Celsius Celsius or 1.5 degree Celsius - Decide target type and boundary - Decide target type and boundary - Same approach as SBTi - Decide timeframe (base year, - Decide timeframe (base year, target - Only purchase carbon offsets target year) year) after reducing Scope 1, 2 and 3 - Identify activities with highest - Identify activities with highest emissions as much as possible emissions first emissions first - Develop carbon reduction plan - Develop carbon reduction plan - Purchase carbon offsets - Scope 1, 2 and 3 reporting (if more than 40% of emissions) - Company’s ambition should be in line with sector’s decarbonisation approach 33  Case Study: Norway’s zero-emissions vehicle 2025 Goal Norway, having been rolling out EV policy measures since the 1990s, has a head start in the electric vehicle (EV) transition as such initiatives. What Norway has done to incentivise EVs: New policies were developed, including the zero registration tax, free tolls and parking, and zero value added tax. ○ The zero value added tax introduced in 2001 was the main contributor to the spike in EV adoption. Public spending of approximately $3.8 billion USD to fund the subsidies and incentives $1.5 trillion wealth fund added to EV bets in 2023 This has resulted in: The highest EV adoption rate in the world In 2023, 82% of new car sales were EVs in Norway as compared to 7.6% in the U.S. and However, the adoption of EVs are not without challenges. 18.1% in Singapore. 34 Source: CNBC  SBTi criteria require emissions reductions of 2.5% per year for targets that address Scope 1 and 2 emissions or emissions reductions of 1.23% per year for targets that address Scope 1, 2, and 3 emissions. Long-term targets should end no later than 2050. To determine whether the target is sufficiently aggressive, align it with the criteria of the Science Based Target (SBTi). 35  SBTi Process Partners 36 Note: SMEs have a slightly different process. Source: carboncredits.com, 2022 Think Moment! Exploring Science Based Targets 1. Visit the Science Based Targets website: sciencebasedtargets.org 2. Download the “Getting Started With Science-Based Targets” guide https://sciencebasedtargets.org/resources/files/SBTi-How-To-Guide.pdf 3. Click on “Set a Target” in the website. 4. Navigate through the site to explore various resources and available options (not necessary to commit or create an account in order to explore the site). 37  SBTi Sector-Specific Considerations SBTi also features special sector-specific considerations for the following: - Financial Institutions - Forest, Land and Agriculture (FLAG) - Industry groups (iron and steel, cement, aluminum, pulp and paper) - Information and Communication - Power These are high priority sectors which are regarded as essential for accurate and closely-monitored engagement in order to achieve global warming targets. 38 Source: SBTi Corporate Manual Case Study – Grab/Comfort Delgro Grab ComfortDelGro 1. Consider the GHG emissions of these two companies. Why is one’s Scope 3 emissions so much larger than the other? 1. How have both companies chosen to define their Scope 3 emissions? 1. In what ways could they further reduce their Scope 3 emissions? Total GHG Emissions: 3.35 million t Total GHG Emissions: 1.4 million t CO2e CO2e Source: Grab ESG Report, 2022 Source: ComfortDelGro ESG Report, 2022 39 Summary Scope 1, Scope 2 and Scope 3 emissions are the direct and indirect emissions produced by industrial activities. Scope 3 is very hard to calculate as it needs to take into account an industrial activity’s full value chain. 40 Regulatory Landscape of GHG 41  Adopted in 1987, the Montreal Protocol is the only UN treaty ever that has been ratified by every country on Earth - all 198 UN Member States. The Montreal Protocol on Substances that Deplete the Ozone Layer is the landmark multilateral environmental agreement that regulates the production and consumption of nearly 100 man-made chemicals referred to as Ozone Depleting Substances (ODS). 42 Source: UNDP, 2021 Kyoto Protocol Adopted in 1997 and entered into force in 2005 Operationalized the United Nations Convention on Climate Change Industrialized countries and transition economies committed to reduce GHG emissions according to individual targets. Established flexible market mechanisms based on the trade of emissions permits. Doha Amendment adopted in 2012 for a second commitment period through 2020, but never entered into force 43 Essentially replaced by the Paris Agreement at COP21, in 2015  Inflation Reduction Act The Inflation Reduction Act is a landmark act passed in 2022. A classic … BUT even after such huge spending, the IRA falls example of pork-barrel politics, the act’s primary objective is to invest in short of the US goal of halving GHG emissions by domestic energy production while promoting clean energy. US$783 billion 2030. will be spent on tackling energy and climate change. Key highlights: - tax credits for wind, solar and storage, blue hydrogen and green hydrogen - continuation of US$7,500 credit on new electric vehicles 44 Source: Climate Action Tracker  Carbon Border Adjustment Mechanism The EU’s Carbon Border Adjustment Mechanism (CBAM) is a landmark tool to put a fair price on the carbon emitted during the production of carbon intensive goods that are entering the EU, and to encourage cleaner industrial production in non-EU countries. The certificates are essentially an import tax. It allows industries within the EU to essentially pass on their emission trading scheme costs to producers outside the EU and create a level playing field between the EU and its trading partners. The CBAM will have significant financial implications for any business looking to sell products into the EU and is caught under the mechanism. 45 Source: Climate Action Tracker  Carbon Border Adjustment Mechanism 46 Source: Climate Action Tracker  Singapore’s Emissions Profile Singapore's strategic position on East-West trade routes has fostered its development as a critical oil storage and refining hub. The refining and petrochemical sector is central to business networks in Southeast Asia and surrounding regions. Despite its economic importance, the sector contributes significantly to carbon emissions, prompting Singapore to implement emission reduction measures. 47 Source: NCCS  Singapore’s 2030 Pledge Singapore's Carbon Intensity, or carbon dioxide emissions per dollar of economic 126th of 142 Countries output, is among the lowest in the world. It ranks 126th out of 142 countries, placing it among the top 20 best-performing countries. Reduce Emissions Intensity (EI) – the amount of GHGs emitted per dollar GDP – by 36% of 2005 levels & to stabilize emissions 48 Source: Energy Efficient Singapore, 2021  How a carbon tax works 1. Introduce a Tax on Emissions ○ Carbon tax will generally be applied upstream, for example, on power stations and other large direct emitters. ○ Businesses can choose to reduce emissions or pay a carbon tax. ○ 2. Encourage Energy Efficiency & Support More Green Actions ○ Businesses are motivated to improve their energy efficiency. ○ Consumers are encouraged to use less electricity and save energy. ○ Carbon tax revenue will help to fund measures by industry to reduce emissions and provide appropriate measures to ease the transition. 3. Lower Carbon, Greener Economy ○ Lower emissions lead to a greener planet. ○ Businesses become more resource-efficient and sustainable. ○ More opportunities in green growth sectors, such as clean technology. 49 Source: Access Cities, 2021  Singapore’s Carbon Pricing Act The Carbon Pricing Act (“CPA”) was introduced in 2019. The CPA, together with the Energy Conservation Act (CAP 92C) and the Environmental Protection and Management Act (Cap 94A), underpin Singapore’s environmental management and energy conservation legislation. Summary of Key Points Carbon Tax Carbon tax of S$5/tonne of CO2 equivalent (“tCO2e”), which will be raised to S$25/tCO2e in 2024/25, and S$45/tCO2e in 2026/27, with a view to reach S$50-80/tCO2e by 2030 Reporting Requirement Facility emits between ≥2,000 and