Loophole in new ETS regulations will increase emissions

Written By: - Date published: 10:31 pm, July 19th, 2010 - 13 comments
Categories: Environment, ETS - Tags:

The ETS-waste regulations currently being consulted on by the Government include a loophole that will actually increase greenhouse gas production in order to save polluters money. This isn’t surprising given that the regulations were prepared for the Government by a company that will be best placed to help its clients develop systems to exploit this loophole by paying less whilst polluting more.

Rotting organic waste in landfills generates methane gas, which is bad for the climate. The ETS purports to want to reduce these methane emissions by charging landfill operators. This is intended to encourage gas capture and flaring (which is not subject to the ETS) and the reduction of organic waste going into landfills (i.e. being used to make compost, etc).

Under the proposed regulations waste to landfill is subject to a ‘default emissions factor’ (DEF). This default factor is based on an average composition of waste to landfills in NZ. The DEF is based on averages, so it assumes a relatively low amount of organic waste, because current practice is to divert greenwaste and use it for compost, mulch, etc.

Under the proposed regulations, any gas that is captured and flared is not subject to ETS charges (this is because methane is considered to be 21 times worse for the climate than the carbon dioxide that results from the flaring – burning – of methane). However, the proposed regulations do not have a default gas capture that matches the DEF (even though most experts say you can not get more than 60% capture). Gas capture is simply calculated by comparing actual gas captured to theoretical gas production under the DEF, which is essentially comparing apples and oranges. The outcome of this is that if a landfill operator increases the proportion of greenwaste entering the landfill (and the amount of methane production) they will pay less charges under the proposed regulations.

This works because the DEF sets a theoretical amount of gas production for a landfill, based on the weight of rubbish being disposed to the landfill. The ETS obligation is calculated by taking the actual gas capture off the theoretical production. The higher the proportion of greenwaste entering a landfill, the higher the methane production is compared to the DEF. This means if you have a lot of greenwaste in the landfill, the methane production is much greater than the DEF, meaning the gas capture is close to the DEF’s theoretical gas production (even though actual gas production is much higher).

Under the proposed ETS regulations, landfill operators only pay for the difference between the theoretical gas production and actual gas capture. This means putting more greenwaste into a landfill (and increasing actual gas capture relative to theoretical gas production) decreases the amount that will need to be paid under the ETS regulations, even though actual gas production is much higher. This loophole is already being exploited as some landfills are now reporting to have over 100% gas capture (which means they pay nothing under the proposed ETS regulations, regardless of their high actual gas production).

This can be simply resolved if the regulations require landfill operators using the DEF to use a default gas capture based on the national average (currently about 40%). Therefore, if landfill operators want to install a high tech gas capture system that is better than the default, they will also need to calculate a unique emissions factor for the waste entering their landfill. The regulations already provide for landfills to calculate unique emissions factors with SWAP Solid Waste Analysis Protocol surveys. That way, landfills wont be able to exploit the DEF by increasing the proportion of greenwaste.

So why is the Government proposing regulations with such a blatant loophole? The Ministry for the Environment has contracted out developing these regulations to a Technical Advisory Group (TAG) comprised of landfill operators already implementing this practice and the company that makes the gas capture systems (conflict of interest anyone?). This is probably because the Government’s cuts in spending to MFE have meant that it can not hire its own staff to do the job properly (or at least objectively). The following links have more detail:

The company that makes the gas capture systems: http://www.tonkin.co.nz/projects_environmental_LFG.htm

The regulations that this company drafted for the Government: http://www.climatechange.govt.nz/consultation/waste/recommendations-for-methodologies/

So what can you do about it? Submissions are still open on the proposed regulations. Make a submission by emailing the Government and telling them that the ETS waste regulations should require landfills using the Default Emissions Factor to use a default gas capture factor as well. More information about submissions can be found at: http://www.climatechange.govt.nz/consultation/waste/

13 comments on “Loophole in new ETS regulations will increase emissions ”

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  1. Draco T Bastard 1
    20 July 2010 at 11:15 am

    So why is the Government proposing regulations with such a blatant loophole?

    This is National – loopholes in the law so that they can get away with doing something immoral is the name of the game.

    • lyndon 1.1
      20 July 2010 at 1:32 pm

      This might actually be a loophole. But they’re using intensity-based free allocations everywhere, which also pays for increased (if more efficient) emissions.

  2. randal 2
    20 July 2010 at 11:19 am

    this is becoming more and more and orwellian by the day.
    the ETS designed to curb the production of dangerous gasses and solid particulates in the atmosphere is now a shield for the polluters.
    is there no end to the duplicity and dissimulation of this government?

  3. prism 3
    20 July 2010 at 12:13 pm

    What are you on about – it’s for the purpose of building wealth for the nation (and somewhat of a big sum for the in-crowd and legislators as well.) Let’s have a piece of that pie in the sky! Lemon meringue, minced up kiwi, cream – in the face?

  4. Cookie 4
    20 July 2010 at 12:25 pm

    The ETS scheme offered by this government is the biggest have!!! and I can’t see any evidence that this scheme will reduce any emissions at all. The government have recently halted a scheme in which involved planting a large number of trees (capture CO2) This was John Key response: We don’t need this anymore because we have ETS.

  5. Ari 5
    20 July 2010 at 2:31 pm

    Gosh, and some people wondered why a bad ETS would be worse than no ETS at all. *headdesk*

  6. Jevon 6
    21 July 2010 at 12:31 pm

    If I understand this correctly, you are claiming the loophole exists from landfills simply increasing their normal greenwaste intake, reducing their overall fee. Right?

    Well, I don’t live in a world where there is an infinite amount of green waste and space to dump landfill, and neither do they. If they increase greenwaste, they have to decrease actual waste, or buy more space. An increased proportion of greenwaste will also improve land reclamation once the landfill is filled. These are good things. Actual (dangerous) waste will become more expensive to dispose.

    Unless you advocate reducing carbon emissions at the cost of actually polluting more?

    • James Henderson 6.1
      21 July 2010 at 4:50 pm

      In a sense: more greenwaste that assumed by the DEF = less obligation under the ETS (regardless of the fact that more emissions are generated)

      At the moment a lot of greenwaste is diverted (refer to NZ waste strategy, waste minimisation act, etc). This current practice impacts the ‘average’ proportion of greenwaste used for the DEF. So while there is not an infinite amount of greenwaste, it will be very easy to significantly increase greenwaste input by stopping current diversion practices.

      As for increased greenwaste improving land reclamation, I don’t understanding what you mean? Care to explain?

      • Jevon 6.1.1
        28 July 2010 at 10:08 pm

        It might be easy to get free greenwaste, but it takes up space. If you have space for 100 m^3 of waste, you could either have 100 m^3 of waste, or 50 m^3 of waste + 50 m^3 of greenwaste. Thus, it becomes more expensive to dump real waste.

        AFAIK greenwaste decreases the time it take for the land to revert back to a usable form. Greenwaste is often used to cover existing landfills to reclaim the land.

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