[Federal Register Volume 67, Number 87 (Monday, May 6, 2002)]
[Notices]
[Pages 30370-30373]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-11180]


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DEPARTMENT OF ENERGY


Voluntary Reporting of Greenhouse Gas Emissions, Reductions, and 
Carbon Sequestration

AGENCY: Department of Energy.

ACTION: Notice of inquiry and request for comment.

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SUMMARY: The Department of Energy (DOE) is seeking comments on possible 
modifications to the guidelines governing the Voluntary Reporting of 
Greenhouse Gases Program (VRGGP) that allows for the voluntary 
reporting of greenhouse gas emissions and reductions, and carbon 
sequestration under section 1605(b) of the Energy Policy Act of 1992. 
On February 14, 2002, the President directed the Secretary of Energy to 
propose improvements to the current registry to ``enhance measurement 
accuracy, reliability and verifiability, working with and taking into 
account emerging domestic and international approaches.'' This notice 
of inquiry is an initial step in a process to propose improvements to 
the current VRGGP Greenhouse Gas Registry (GHG Registry), for which 
guidelines were published in 1994. DOE is seeking comment on the issues 
posed below, and welcomes any other comments pertinent to future 
changes in the GHG Registry.
    Because of the broad public interest in the issues involved, DOE 
believes that the public should have an opportunity to provide input on 
the issues raised in advance of the Secretary's recommendations to the 
President. DOE is requesting written comments as one means to bring a 
broad range of views into the process of developing recommendations for 
proposed improvement to the GHG Registry. After analyzing submissions 
made in response to this notice, DOE contemplates scheduling at least 
one public workshop for obtaining additional public input prior to 
finalizing the recommendations for proposed improvements to the GHG 
Registry. Notice of workshop(s) and other opportunities for input 
during development of proposed improvements to the GHG Registry will be 
published in the Federal Register.

DATES: Commenters should submit a signed original, a computer diskette 
(WordPerfect or Microsoft Word) and three copies of the written 
comments. Written comments are to be filed at the address listed below 
no later than 4:30 p.m., eastern time June 5, 2002. Alternately, 
comments can be filed electronically by e-mail to: 
[email protected], noting ``Voluntary Reporting 
Comments'' in the subject line.

ADDRESSES: Written comments should be submitted to: Office of Policy 
and International Affairs, Office of Electricity and Natural Gas 
Analysis, PI-23, Attention: Voluntary Reporting Comments, U.S. 
Department of Energy, Forrestal Building, Room 7H-034, 1000 
Independence Ave., SW., Washington, DC 20585. Alternately, comments can 
be filed electronically by e-mail to: [email protected], 
noting ``Voluntary Reporting Comments'' in the subject line.

FOR FURTHER INFORMATION CONTACT: Ms. Jean Vernet, U.S. Department of 
Energy, Office of Policy and International Affairs, Office of 
Electricity and Natural Gas Analysis, Forrestal Building, PI-23, Room 
7H-034, 1000 Independence Ave., SW., Washington, DC 20585, (202) 586-
4755, e-mail: [email protected]; or Mr. Peter Karpoff, PI-23, 
(202) 586-5639, e-mail: [email protected].

SUPPLEMENTARY INFORMATION:   

I. Background

A. Section 1605(b) of EPAct and the Current Guidelines

    Section 1605(b) of the Energy Policy Act of 1992 (EPAct), Public 
Law 102-486, required the Secretary of Energy, with the Energy 
Information Administration (EIA), to establish a voluntary reporting 
program and database on emissions of greenhouse gases, reductions of 
these gases, and carbon sequestration (42 U.S.C. 13385(b)). More 
specifically, section 1605(b) required that DOE's guidelines provide 
for the ``accurate'' and ``voluntary'' reporting of information on: (1) 
Greenhouse gas emission levels for a baseline period (1987-1990) and, 
thereafter, annually; (2) annual reductions of greenhouse gas emissions 
and carbon sequestration regardless of the specific method used to 
achieve them; (3) greenhouse gas emission reductions achieved because 
of voluntary efforts, plant closings, or mandatory state or federal 
requirements; and (4) the aggregate calculation of greenhouse gas 
emissions by each reporting entity (42 U.S.C. 13385(b)(1)(A)-(D)). 
Section 1605(b) contemplates a program whereby voluntary efforts to 
reduce greenhouse gas emissions could be recorded, with the specific 
purpose that this record could be used ``by the reporting entity to 
demonstrate achieved reductions of greenhouse gases'' (42 U.S.C. 
13385(b)(4)).
    To carry out this statutory mandate, DOE established the GHG 
Registry, a program for the voluntary reporting of greenhouse gas 
emissions, emission reductions and carbon sequestration that has been 
in operation since 1995. The GHG Registry currently is governed by the 
General Guidelines for the Voluntary Reporting of Greenhouse Gases 
under Section 1605(b) of the Energy Policy Act of 1992 (``General 
Guidelines''), which were issued in 1994 after notice and public 
comment (59 FR 52769). The current General Guidelines are supported by 
two additional documents: Sector-Specific Issues and Reporting 
Methodologies, volumes one and two, which include supporting Appendices 
A-E. Volume one of the Sector-Specific Issues and Reporting 
Methodologies addresses the Electricity Supply Sector, Residential and 
Commercial Buildings Sector, and Industrial Sector. Volume two covers 
the Transportation Sector, Forestry Sector, and Agricultural Sector. 
Together, the General Guidelines and supporting documents establish a 
broad-based program for the reporting of greenhouse gas reductions and 
carbon sequestration that result from voluntary and other activities. 
The General Guidelines and supporting documents may be accessed at 
http://www.eia.doe.gov/oiaf/1605/guidelns.html.
    The current General Guidelines encourage participants to report all 
types of greenhouse gas emission reduction and carbon sequestration 
activities, and participants are given flexibility in determining 
whether and how actual reductions are accomplished and reported. Any 
person or entity (``reporter'') who wishes to participate in the 
current GHG Registry must, however, comply with the following minimum 
information requirements:

    (1) Reporters must clearly identify the facilities involved, the 
greenhouse gases reduced, the amount of reduction, and the year of 
the emissions;
    (2) Reporters must describe the emissions reduction or carbon 
sequestration project and

[[Page 30371]]

provide sufficient data to permit database users to have ``a clear 
understanding of the nature and scope'' of the project, ``including 
the cause of the change in emissions or carbon sequestration'';
    (3) Reporters must be able to identify the source of the data 
presented, the level of change in emissions or sequestration per 
year, and the year in which the change took place; and
    (4) Reporters who submit a project report of their own design 
must identify the techniques used to gather the data and to make 
estimates.

    As required by section 1605(b)(2), EIA developed forms for 
reporting to the GHG Registry. As long as participants use EIA forms 
and meet the minimum reporting requirements, they are allowed to define 
the activities they report and to determine how to estimate the effects 
of those activities on greenhouse gas emissions and carbon 
sequestration. The General Guidelines require reporters to self-certify 
the accuracy of their reports, but does not specify verification 
measures. As part of the report review process, EIA evaluates each 
report received for consistency with the General Guidelines, 
comprehensiveness, and arithmetic accuracy, and makes suggestions for 
improving the accuracy and clarity of reports. EIA also provides 
reporters with suggested and default greenhouse gas emissions factors 
for optional use.
    Additional information, including the program's annual reports and 
reporting forms, can be accessed at http://www.eia.doe.gov/oiaf/1605/frntvrgg.html.

B. The President's Directive To Improve the GHG Registry

    On February 14, 2002, President Bush, in announcing a new approach 
for meeting the long-term challenge of climate change, directed the 
Secretary of Energy, in consultation with the Secretaries of Commerce 
and Agriculture, the Administrator of the Environmental Protection 
Agency (EPA), and other Departments and agencies, to propose 
improvements to the current program to ``enhance measurement accuracy, 
reliability and verifiability, working with and taking into account 
emerging domestic and international approaches.'' \1\ The President 
directed that DOE recommend proposed improvements to the GHG Registry 
within 120 days. Also on February 14, 2002, the President directed the 
Secretary of Energy to recommend reforms ``to ensure that businesses 
and individuals that register reductions are not penalized under a 
future climate policy, and to give transferable credits to companies 
that can show real emissions reductions.'' \2\ The President also 
directed the Secretary of Agriculture, in consultation with EPA and 
DOE, to develop accounting rules and guidelines for crediting carbon 
sequestration projects.
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    \1\ Global Climate Change Policy Book 2 (White House, February 
14, 2002).
    \2\ Id.
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    Pursuit of the related Presidential directives poses significant 
policy, technical, and legal questions. In light of the short time 
available, DOE began consultations with the Departments of Commerce and 
Agriculture, and the EPA immediately after the President's 
announcement. This notice is directed to obtaining information from 
interested parties that will be useful in developing proposed 
improvements to the GHG Registry consistent with the President's 
announcement. If, as a result, modifications to the guidelines for 
reporting are pursued, the public will be given an opportunity to 
comment on the proposed revised guidelines, as provided in section 
1605(b)(1) (42 U.S.C. 13385(b)(1)).

II. Request for Public Comment

    DOE requests written comments from interested persons on all 
aspects of possible revisions to the guidelines governing the GHG 
Registry. DOE is especially interested in receiving written comments 
from persons with particular knowledge of the institutional, legal, and 
technical issues related to measuring and reporting GHG emissions, 
emissions reductions, and carbon sequestration. All information 
provided by commenters will be available for public inspection at the 
Department of Energy, Freedom of Information Reading Room, room 1E-190, 
1000 Independence Ave., SW, Washington, DC 20585, between the hours of 
9 a.m. and 4 p.m., Monday though Friday, except Federal holidays.
    DOE also intends to enter all written comments on a website 
specially established for this proceeding. The Internet website is 
http://www.pi.energy.gov/enhancingGHGregistry. To assist DOE in making 
public comments available on a website, interested persons are 
encouraged to submit an electronic version of their written comments in 
accordance with the instructions in the DATES section of this notice.
    Because DOE intends to make all submissions publicly available on a 
website, it requests that commenters not submit information believed to 
be confidential and exempt from public disclosure. However, if any 
person chooses to submit information that he or she considers to be 
privileged or confidential and exempt from public disclosure, that 
person must clearly identify the information that is considered to be 
privileged or confidential and explain why the submitter thinks the 
information is exempt from disclosure, addressing as appropriate the 
criteria for nondisclosure in DOE's Freedom of Information Act 
regulations at 10 CFR 1004.11(f). DOE also requests such submitters to 
provide one copy of their comments from which the information believed 
to be exempt from disclosure has been redacted, with the areas where 
information has been redacted clearly marked. DOE will determine if the 
information or data sought to be protected from disclosure is exempt 
from disclosure in accordance with the procedures set forth in its 
Freedom of Information Act regulations at 10 CFR 1004.11.
    Commenters may find it helpful to review the notices that preceded 
the issuance of the current guidelines in 1994. These notices provide 
additional detail on issues considered during the development of the 
current guidelines: Notice of Inquiry (58 FR 40116; July 27, 1993); 
Notice of Availability requesting comment on the draft guidelines (59 
FR 28345; June 1, 1994); and the Notice of Availability of the 
Guidelines (59 FR 52769; October 19, 1994). DOE has included these 
notices on the website established for this proceeding for the 
convenience of interested persons.

III. Issues for Comment

    This section of the notice identifies specific areas for comment; 
however, these areas are not intended to limit the content of 
submissions.

A. Issues Related to Comment Scope

     Identify and discuss whether and how any improvement you 
suggest is necessary and appropriate in light of the President's 
directives and the purposes of the reporting program, including 
reporting of emission reductions and carbon sequestration activities 
for transferable credits or protection against penalty under future 
climate policy.

B. Issues in the Relationship of the GHG Registry to Other Approaches 
in GHG Reporting

     Identify and discuss whether and how your suggested 
improvements are consistent with existing and emerging domestic and 
international approaches to reporting GHG emissions, emission 
reductions and carbon sequestration. DOE is aware that efforts in the 
public and private sectors, domestic and international, have been 
undertaken to

[[Page 30372]]

develop GHG reporting approaches. Included in these are efforts by U.S. 
state governments, foreign governments, and multinational stakeholder 
groups. Reporting protocols have also been developed under voluntary 
emissions reduction programs initiated by the federal government and 
others.

C. Institutional Issues

     Time frame of data reported. Identify and discuss how any 
suggested improvements to the GHG Registry could accommodate the time 
period of reported emissions and emissions reductions, and carbon 
sequestration. The current GHG Registry accepts information on 
emissions and reductions back to 1991 and on emissions back to 1987, 
and provides for revision and supplementation of submitted reports. If 
your suggested improvements to the GHG Registry entail submission of 
additional accompanying information or new protocols for some types of 
reports, discuss how the guidelines could address the time frame of 
past and future reported data, and whether and how previously submitted 
data may be resubmitted under the revised purposes of the Registry.
     Reporting entity definition. Discuss whether the GHG 
Registry's broad definition of ``reporting entity'' continues to be 
appropriate in any improved reporting program. The current guidelines 
define a reporting entity as ``a legal U.S. entity,'' meaning ``any 
U.S. citizen or resident alien; any company, organization, or group 
incorporated under or recognized by U.S. law; or any U.S. Federal, 
state, or local government entity.''
     Level of reporting. Discuss whether it is appropriate for 
reports to cover: (1) All emitting activities of the entire reporting 
entity; (2) emissions by facility/site, affiliate, or subsidiary; or 
(3) an emissions reduction, emissions avoidance or carbon sequestration 
project. Identify how different levels of reporting may be appropriate 
for various reporting purposes, including for transferable credits and 
protection against penalty under future climate policy.
     Reportable GHGs. Discuss whether and how it may be 
appropriate, in light of your suggested improvements to the GHG 
Registry, to modify the current GHG Registry approach which allows 
reports on various greenhouse gases and other pollutants, and their 
reduction. These gases include carbon dioxide, methane, nitrous oxides, 
perfluorocarbons (PFCs), hydrofluorocarbons (HFCs) and sulfur 
hexafluoride (SF6).
     Indirect emissions. Identify and discuss how a reporter 
could treat indirect emissions, such as those resulting from 
electricity use, and indirect emissions reductions, such as those from 
decreased electricity use, in the context of an improved reporting 
program. Discuss whether and how life cycle and fuel cycle emissions, 
and wholesale electric or natural gas transactions should be treated. 
Indirect emissions are emissions from sources outside the reporting 
entity that are affected by the reporter's activities, for example, 
emissions of an electric utility resulting from the reporter's 
consumption of electricity.
     Avoided emissions. Identify and discuss how a reporter 
could treat actions that avoid, at least in part, the production of GHG 
emissions. The GHG Registry currently includes these as reported 
reductions. Examples of activities that avoid emissions include, but 
are not limited to, electricity generation from renewable energy 
sources or nuclear power, the use of natural gas-fueled motor vehicles, 
and energy efficiency improvements in industrial or other applications.
     Baselines (or reference case) definition. Identify and 
discuss appropriate changes to the GHG Registry's approaches to 
determining an emissions baseline(s) or reference case. Identify how 
different baseline determinations may be appropriate for reporting 
purposes, transferable credits, or protection against penalty under 
future climate policy. Discuss how the reporting program could be used 
by reporters who may wish to report their GHG emissions measured as 
emissions per unit of output or emissions intensity. Discuss how 
``units of output'' or emissions intensity could be calculated for 
varying industries. The current guidelines permit the reporter several 
options for identifying the baseline (referred to as the reference 
case) for emissions reductions or carbon sequestration, including use 
of historical emissions or sequestration (historical reference case), 
or an estimate of what emissions or sequestration would have been in 
the absence of a project or a group of projects (modified reference 
case).
     Thresholds for reporting emissions and for reporting 
emissions reductions.
    The current guidelines do not set a minimum size for a reporting 
entity, or for reported emissions, emissions reductions, avoided 
emissions, or sequestered carbon. Identify and discuss whether and how 
an improved program might appropriately set minimum thresholds for 
these categories of data.
     Reduction activity reports on domestic and international 
projects. The current GHG Registry accepts reports of project-level 
data for both domestic and international projects, without regard to 
entity-level emissions data. Discuss the need for, and appropriateness 
of, entity-level emissions data accompanying information on projects 
either within or outside the U.S.
     Transferable credits and transferring ownership of 
reductions. Discuss any attributes of GHG emissions reductions or 
carbon sequestration that may be appropriate or necessary for 
transferable emissions reduction or carbon sequestration credits. 
Provide information on reporting parameters you believe are necessary 
to establish and transfer ownership of real emissions reductions or 
carbon sequestration credits.
     Reporting joint activities, addressing duplication of 
reported emissions and reductions, and ownership. The current 
guidelines permit reporters, or third parties on the behalf of others, 
to report individual and joint activities, and to modify reporter-
identification as needed. Discuss whether and what changes are 
appropriate or necessary to minimize duplicative reporting, and assure 
correct identification of the owner of emissions, emission reductions 
or avoidance, and carbon sequestration.
     Verification and third-party audit standards. As required 
by 1605(b)(2), the current guidelines and EIA forms require that the 
reporter self-certify the accuracy of the reported information (42 
U.S.C. 13385(b)(2)). No independent certification or verification is 
required. While the Federal government does not certify reported data, 
EIA currently reviews each report for consistency with the program 
guidelines, comprehensiveness, and arithmetic accuracy. Identify and 
discuss any forms of verification that may be appropriate in a program 
that contemplates the use of the GHG Registry for transferable credits. 
If you suggest third party verification or certification, discuss 
possible standards for certifying bodies.
     Confidentiality of reported data; public availability of 
information. The current guidelines provide that information determined 
under DOE regulations to be confidential under the Freedom of 
Information Act (5 U.S.C. 552(b)(4)) does not appear in EIA's public 
database and is not made available to the public. This is consistent 
with the provision in section 1605(b) requiring the protection of trade 
secret and commercial or financial information that is privileged or

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confidential (42 U.S.C. 13385(b)(3)). Discuss whether revised 
guidelines should include a provision requiring reporters to waive the 
protection provided by section 1605(b)(3) if they wish to obtain a 
certificate of emission reductions for potential use in connection with 
transferable credits, or for protection against penalty under future 
climate policy.

D. Technical Issues

     Measurement and estimation techniques. Although the 
current guidelines and reporting forms provide a number of default and 
other estimation techniques, they do not prescribe measurement and 
estimation techniques. Identify and discuss the need for prescribed 
techniques for measurement and estimation under an improved GHG 
Registry that could provide the basis for transferable credits or 
protection against penalty under future climate policy. Provide 
specific examples and citations to techniques you identify.

    Issued in Washington, DC, on April 15, 2002.
Robert Card,
Undersecretary.
[FR Doc. 02-11180 Filed 5-3-02; 8:45 am]
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