Decarbonisation Technology - November 2024 Issue

Dual ETS consideration for carbon accounting: EfW: One set of carbon accounting rules (process ETS focus). ACT/ATT: Must address both process and product ETS carbon accounting, adding policy & regulatory complexity.

Boundary denition for GHG permits:

Policy & regulatory alignment:

Sector-specic ETS rules:

MRV reporting challenges:

Diverse outputs:

EfW: Narrower focus covering waste, power and heat sectors. ACT/ATT: Requires coordination accross various sector-specic regulations e.g. waste sector and energy-intensive

EfW: Still very challenging but can build on existing best practices for permitting and emissions reporting. ACT/ATT: Many FOAK processes as well as complex reporting for multiple outputs and sectors.

EfW: Single ETS framework for waste-to-energy.

EfW: Clear emissions boundaries.

EfW: Produces power and heat.

ACT/ATT: Complex boundaries due to diverse applications and products – especially in cases

ACT/ATT: Generates varied products-power, heat, gases, fuels, chemicals, each into dierent sectors with distinct ETS rules.

ACT/ATT: Multiple ETS frameworks for dierent product sectors, complicating MRV requirements.

of industrial co-location.

industries/ chemicals/ transport.

More generally, there is already a need for standardised approach to carbon accounting in the waste sector – ETS can enable this.

Figure 7 The challenge of including ACT/ATT in the ETS

Recycled carbon fuel (RCF) Like many others in the sector, we support adopting the Recycled carbon fuel (RCF) methodology to apply an ETS discount on the fossil fuel portion of ACT/ATT emissions, particularly when these technologies are targeting hard-to-abate sectors (see Figure 7 ). RCFs are derived from non-recyclable waste materials, such as MSW and waste industrial gases, which would otherwise be combusted or landfilled. RCFs are already widely recognised and used effectively within the transport sector in the UK and European Union as credible ways of supporting decarbonisation in other hard-to- abate sectors. Adopting the RCF methodology to apply an ETS discount would facilitate the fair inclusion of advanced technologies in the UK, potentially resulting in cost savings for ETS customers like local authorities. However, this discount must be carefully calibrated to account for existing support mechanisms available, such as some downstream applications. Like the way RCFs are recognised in transport sector accounting, we would like to see the creation of a standardised carbon accounting methodology that can be developed into an accounting framework for the waste sector. Unlike the Low Carbon Hydrogen Standard (LCHS) for hydrogen and the Renewable Transport Fuel Obligation (RTFO) for transport, there is no consistent and transparent emission reporting for the waste sector.

Varying feedstocks and the need to work backwards to the point of origin make monitoring, reporting, and verification extremely complicated. Certification schemes such as the International Sustainable Carbon Certification (ISCC), which provides a stamp for the end product, are difficult when you would need to know the waste’s history and and its exact point of origin, for example, which town or city and which local authority. Cross-departmental collaboration, particularly in the wake of a new government, needs to happen as soon as possible. It is crucial that the Department for Energy Security and Net Zero (DESNZ), the Department for the Environment, Food and Rural Affairs (DEFRA), the Department for Transport (DfT), and other relevant bodies work together to develop strong ETS frameworks. The picture, as it has been for the past decade of KEW Technology, is complicated and challenging but not insurmountable with a shared goal of a world without fossil fuels. If we create an environment that fosters innovation and sustainability across all sectors on a level playing field, we can reach net zero collaboratively. It will be many technological solutions, not one golden bullet, that get us there.

Amna Bezanty ABezanty@kew-tech.com