LEED v4, Renewable Energy, and Carbon Offsets

LEED v4, Renewable Energy, and Carbon Offsets

The U.S. Green Building Council's (USGBC's) Leadership in Energy and Environmental Design (LEED) is the market-leading standard for green building design. The recent LEED v4 update includes the ability to earn points toward certification by purchasing Green-e certified renewable energy and carbon offsets. Join Alex Pennock, manager of Green-e Energy and Todd Jones, manager of Green-e Climate, as they review the new changes and answer common questions about the updated green power and carbon offset credit, along with the rationale for these changes and how they will affect the market. With Alex Pennock, manager of Green-e Energy, and Todd Jones, manager of Green-e Climate. Originally aired Wednesday, April 10, 2014.

Transcript

  1. LEED, RENEWABLE ENERGY, AND CARBON OFFSETS HOW THE LEED v4

    STANDARD IMPACTS YOUR RENEWABLE ENERGY AND OFFSET STRATEGY April 10, 2014
  2. None
  3. Brief Intros to LEED and Green-e Green-e in the 2009

    versions of LEED Rating Systems LEED v.4 Green Power and Carbon Offsets Point Green-e “equivalence” Other points for renewables Effect of LEED v4 on Renewable Energy and Carbon Offset Markets Summary/Conclusions Q&A OUTLINE
  4. 2 Standards Working Together Green-­‐e  is  a  family  of  independent

      cer1fica1on  programs,  for  renewable   energy,  carbon  offsets,  and  the   companies  and  products  that  use  them   to  reduce  their  environmental  impact.   LEED  is  an  independent  cer1fica1on   for  green  building  design,   construc1on,  opera1ons  and   maintenance.  
  5. 2 Standards Working Together

  6. 2 Standards Working Together

  7. 2 Standards Working Together The  leading  cer2fica2on  for  renewable  energy

     in  North  America.     Works  with  renewable  energy  sellers  to  offer  consumers  na1onwide   clean,  renewable  electricity  that  has  been  independently  verified,  as  a   viable  alterna1ve  to  conven1onal  electricity  and  the  impacts  of  its   genera1on.   Cer1fies  the  following  renewable  energy  products:   •  Renewable  Energy  Cer1ficates,   •  U1lity  Green  Pricing  Programs,  and     •  Compe11ve  Electricity  Products.  
  8. 2 Standards Working Together The  global  retail  standard  for  carbon

     offsets.     Strengthens  the  market  for  voluntary  emissions  reduc1ons  by  cer1fying   that  carbon  offsets  sold  contain  real,  verified  reduc1ons  from  high-­‐quality   and  addi1onal  projects,  verifying  sales,  correct  delivery  of  the  offsets  and   exclusive  retail  ownership,  and  by  reviewing  the  informa1on  provided  to   offset  consumers  for  adequacy  and  accuracy.  
  9. LEED 2009 Green Power and Green-e in NC,  C&S,  Schools,

     Retail,  Healthcare  (1  pt)  –  EA  CREDIT:  GREEN  POWER   (maximum  2  points)     •  “as  defined  by  the  …  Green-­‐e  Energy  product  cer2fica2on   requirements  or  an  equivalent.”   •  “Engage  in  at  least  a  2-­‐year  renewable  energy  contract”   •  “at  least  35%  of  the  building’s  electricity  from  renewable  sources”  
  10. LEED 2009 Green Power and Green-e in CI  –  EA

     CREDIT:  GREEN  POWER   (maximum  5  points)     •  Op1on  1:  2-­‐year  renewable  energy  contract  to  provide  at  least  50%  of   the  tenant’s  electricity  from  renewable  sources”   •  Op1on  2:  “2-­‐year  renewable  energy  contract  to  purchase  at  least  8   kilowaU  hours  per  square  foot  per  year”  
  11. LEED 2009 Green Power and Green-e in EBOM  –  EA

     CREDIT:  ON-­‐SITE  AND  OFF-­‐SITE  RENEWABLE  ENERGY   (maximum  6  points)     •  “Off-­‐site  renewable  energy  sources  are  defined  by  the  …  Green-­‐e   Energy  program  …  or  the  equivalent.”   •  “…  purchase  RECs  for  a  minimum  of  2  years  and  must  also  make  a   commitment  to  purchase  RECs  on  an  ongoing  basis  beyond  that.”   •  Up  to  6  points  are  awarded  for  purchases  of  25%  to  100%  RE  per  year  
  12. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    •  Building  Design  and  Construc1on   (BD&C)   •  Exis1ng  Building  Opera1ons  and   Maintenance  (EBOM)   •  Interior  Design  and  Construc1on   (ID&C)   •  Homes   •  Neighborhood  Development  (ND)   LEED  2009  Ra2ng  Systems   LEED  v.4  Ra2ng  Systems  
  13. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    BD&C  and  ID&C  –  EA  CREDIT:  GREEN  POWER  AND  CARBON  OFFSETS     (maximum  2  points)     •  “resources  that  have  come  online  since  January  1,  2005”   •  “contract  […]  for  a  minimum  of  five  years,  […]  delivered  at  least  annually”   •  “provision  of  at  least  50%  or  100%  of  the  project’s  energy  from  green   power,  carbon  offsets,  or  renewable  energy  cer1ficates  (RECs)”   •  “Green  power  and  RECs  must  be  Green-­‐e  Energy  cer2fied  or  the   equivalent.  RECs  can  only  be  used  to  mi1gate  the  effects  of  Scope  2,   electricity  use.”  
  14. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    •  “Carbon  offsets  may  be  used  to  mi1gate  Scope  1  or  Scope  2  emissions   on  a  metric  ton  of  carbon  dioxide–equivalent  basis  and  must  be  Green-­‐ e  Climate  cer2fied,  or  the  equivalent.”   •  “For  U.S.  projects,  the  offsets  must  be  from  […]  projects  within  the   United  States.”               BD&C  and  ID&C  –  EA  CREDIT:  GREEN  POWER  AND  CARBON  OFFSETS     (maximum  2  points)    
  15. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    Percentage  of  total  energy  addressed  by  green  power,   RECs  and/or  offsets Points 50%   1   100%   2   “Determine  the  percentage  of  green  power  or  offsets  based  on  the  quan1ty   of  energy  consumed,  not  the  cost.  Points  are  awarded  according  to  Table  1.”     Table  1.  Points  for  energy  from  green  power  or  carbon  offsets   BD&C  and  ID&C  –  EA  CREDIT:  GREEN  POWER  AND  CARBON  OFFSETS     (maximum  2  points)    
  16. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    EBOM  –  EA  CREDIT:  RENEWABLE  ENERGY  AND  CARBON  OFFSETS   (maximum  5  points)     “Demonstrate  one  or  both  of  the  following  for  at  least  a  por2on  of  the   building’s  total  energy  use.     •  Total  energy  use  is  met  directly  with  renewable  energy  systems.     •  A  minimum  two-­‐year  contract  is  in  place,  with  the  commitment  to   renew  on  an  ongoing  basis,  to  purchase  qualified  resources  that  will   be  delivered  at  least  annually.  Resources  must  have  come  online  a_er   January  1,  2005.”    
  17. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    •  If  the  second  op1on,  then  “engage  in  a  contract  to  purchase  green  power,   carbon  offsets,  or  Renewable  Energy  Cer1ficates  (RECs).”   •  RECs  for  Scope  2  only;  offsets  for  Scopes  1  or  2   •  “Green  power  and  RECs  must  be  Green-­‐e  Energy  cer2fied  or  the  equivalent”   and  “Carbon  offsets  […]  must  be  Green-­‐e  Climate  cer2fied,  or  the   equivalent.”   •  “For  U.S.  projects,  the  offsets  must  be  from  […]  projects  within  the  United   States.”   EBOM  –  EA  CREDIT:  RENEWABLE  ENERGY  AND  CARBON  OFFSETS   (maximum  5  points)    
  18. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    EBOM  –  EA  CREDIT:  RENEWABLE  ENERGY  AND  CARBON  OFFSETS     “Use  the  following  equa1on  to  calculate  credit,  up  to  the  5-­‐point  limit:”     Points      =   Renewable  energy   generated  %   1.5%   Energy  purchased/offset  %   (Not  to  exceed  100%)   25%   +  
  19. LEED v4 Stronger Green Power Obligations & Introducing Carbon Offsets

    •  Annual  electricity  and  non-­‐electricity  energy  use  calcula1ons     •  Calcula1ons  showing  required  REC,  green  power,  or  carbon   offsets  for  targeted  point  threshold       •  Purchase  contract  for  RECs,  green  power,  or  carbon  offsets     •  Green-­‐e  equivalency  documenta1on,  if  not  Green-­‐e  cer1fied   •  EBOM  on-­‐site:  RE  produc1on,  and  10-­‐year  contract  for   replacement  RECs  /  offset  if  on-­‐site  RECs  sold       REQUIRED  DOCUMENTATION  
  20. LEED v4 Other Points for Renewables •  Credit  is  based

     on  COST  of  electricity,  not  produc1on  and  use   •  Off-­‐site  “solar  gardens”  allowed     ND+C  and  ID+C  –  EA  CREDIT:  RENEWABLE  ENERGY  PRODUCTION   hUp://www.leeduser.com/credit/NC-­‐2009/EAc2   •  REC  reten1on  not  specified,   but  indicated  in:   •  USGBC  Forums     •  Reference  Guide  (for   EBOM  RE  point  e.g.)   •  LEEDuser.com  (for  2009   NC  EAc2):  
  21. ( =) What is “equivalent” to Green-e? or   LEED

     v4  says:     “Green  power  and  RECs  must  be  Green-­‐e   Energy  cer2fied  or  the  equivalent.  RECs  can   only  be  used  to  mi1gate  the  effects  of  Scope   2,  electricity  use.  ”    
  22. ( =) What is “equivalent” to Green-e? or   • 

    Resource  eligibility   •  All  aUributes  included   •  Double  coun1ng  preven1on   •  Annual  verifica1on   •  Customer  disclosure   •  Claims  enforcement   Includes:  
  23. ( =) What is “equivalent” to Green-e? or   • 

    Standalone  tracking  system  REC   re1rement   •  ‘Green-­‐e  Energy  Eligible’  facility   •  ‘Cer1fiABLE’  RECs   •  RE  w/out  carbon  value   •  Null  power  claimed  as  RE   ≠
  24. ( =) What is “equivalent” to Green-e? or   • 

    Green-­‐e  Energy  US  RECs  s1ll  allowed,  though  USGBC   interested  in  suppor1ng  local  genera1on   •  EBOM  2009  EU  alterna1ve  compliance  paths     •  Offsets  allowed  for  electricity  emissions  in  any  country   •  Calcula1on  informa1on  in  Reference  Guide   INTERNATIONAL  TIPS  
  25. ( =) What is “equivalent” to Green-e? or   ≠

    American  Carbon  Registry  (ACR)  VERs   Clean  Development  Mechanism  (CDM)  CERs   Climate  Ac1on  Reserve  CRTs   Gold  Standard  VERs   Verified  Carbon  Standard  (VCS)  VCUs   …alone  
  26. ( =) What is “equivalent” to Green-e? or   Carbon

     offset   project   Greenhouse  gas   emissions  reduc2on   Retail  carbon     offset  product   End-­‐use   consumer   Carbon  Offset  Market  -­‐   Oversight  
  27. ( =) What is “equivalent” to Green-e? or   The

     American  Carbon  Registry   The  Climate  Ac2on  Reserve   The  Gold  Standard   The  Verified  Carbon  Standard   Carbon  offset   project   Greenhouse  gas   emissions  reduc2on   Retail  carbon     offset  product   End-­‐use   consumer   Carbon  Offset  Market  -­‐  Oversight   Registry  account-­‐ holders/retailers   •  Permanence     •  Addi1onality   •  Verified   •  Enforceable     •  Real  
  28. ( =) What is “equivalent” to Green-e? or   The

     American  Carbon  Registry   The  Climate  Ac2on  Reserve   The  Gold  Standard   The  Verified  Carbon  Standard   Carbon  offset   project   Greenhouse  gas   emissions  reduc2on   Retail  carbon     offset  product   End-­‐use   consumer   Carbon  Offset  Market  -­‐  Oversight   Registry  account-­‐ holders/retailers   •  Permanence     •  Addi1onality   •  Verified   •  Enforceable     •  Real   Looks  for  the   Green-­‐e  Logo  
  29. •  Permanence     •  Addi1onality   •  Verified  

    •  Enforceable     •  Real   The  American  Carbon  Registry   The  Climate  Ac2on  Reserve   The  Gold  Standard   The  Verified  Carbon  Standard   Carbon  offset   project   Greenhouse  gas   emissions  reduc2on   Retail  carbon     offset  product   End-­‐use   consumer   Registry  account-­‐ holders/retailers   Looks  for  the   Green-­‐e  Logo   •  Cer1fies  the  retail  carbon  offset  product   •  Looks  back  at  the  chain  of  custody  to:   §  Set  a  standard  for  project  standard  eligibility   §  Verify  chain  of  custody  from  project  to  end  user  in  registries   •  Verifies  the  retail  transac1on  for  correct  delivery  and  unique   ownership   ( =) What is “equivalent” to Green-e? or  
  30. LEED v4 Effect on the Markets for Renewable Energy and

    Carbon Offsets •  Importance  of  long-­‐term  purchasing  is  addressed,  transi1on  may   not  be  smooth   •  Per-­‐MWh  prices  for  long-­‐term  REC  contracts  higher,  and  prices   already  likely  to  rise  as  market  demand  meets  supply   •  U1lity  green  electricity  programs  may  benefit,  as  long-­‐term   par1cipa1on  is  easier  and  poses  less  risk   •  Number  of  buildings  choosing  the  point  likely  to  decrease  vs   using  LEED  2009,  slowing  growth  of  RE  MWh  for  LEED  
  31. LEED v4 Effect on the Markets for Renewable Energy and

    Carbon Offsets •  Compe11on  between  RE  and  offsets  for  electricity  emissions   •  Offset  markets  will  benefit  overall   •  Renewable  MWh  s1ll  chosen  for  electricity  due  to  price   •  Total  emissions  addressed  by  LEED  buildings,  and  purchases  of   offsets  and  renewable  MWh,  will  rise  overall   •  Interna1onal  projects  benefit,  as  point  can  be  met  with  offsets   rather  than  only  US  RECs  
  32. Summary and Conclusions •  Green  power/Renewable  Energy  and  Carbon  Offset

     points  in  3  of  5   new  LEED  ra1ng  systems   •  2  possible  points  in  BD&C  and  ID&C,  and  4  possible  points  for  RE   or  offset  in  EBOM  (up  to  5  total  with  on-­‐site  RE)   •  50  or  100%  of  energy  use  in  BD&C  and  ID&C,  0-­‐100%  in  EBOM   •  2005  online  date   •  5-­‐year  commitments  in  BD&C  and  ID&C,  2-­‐year  commitment  with   renewal  in  EBOM   •  Green-­‐e  Energy  cer1fica1on  required  for  green  power  and  RECs  
  33. Summary and Conclusions •  Green-­‐e  Climate  cer1fica1on  required  for  carbon

     offsets   •  Offsets  for  US  buildings  met  with  US  offsets   •  REC  ownership/re1rement  required  for  all  renewable  energy  usage   claims  in  the  US   •  There  is  no  “equivalent”  of  Green-­‐e;  purchasers  of  uncer1fied   products  will  need  to  demonstrate  assurances;  project  cer1fica1ons   alone  are  not  equivalent   •  RE  and  offset  markets  likely  to  grow;  RE  perhaps  more  slowly   •  Cost  of  RE  in  point  will  increase,  likely  to  remain  below  offset  prices  
  34. ? ? Todd Jones Green-e Climate Manager Center for Resource

    Solutions todd@resource-solutions.org CONTACT @greenemarktplc facebook.com/CenterForResourceSolutions   Alex Pennock Green-e Energy Manager Center for Resource Solutions alex@resource-solutions.org