Accounting of Emissions and
Assigned Amount under the Kyoto
Protocol
Clare Breidenich
UNFCCC Consultant
Overview

Introduction to Kyoto Compliance Architecture

Role of reporting, review and compliance
procedures in accounting of emissions and
assigned amount
 Eligibility to participate in the Kyoto Mechanisms
 Accounting prior to, during and at end of commitment
period

LULUCF Accounting
Compliance with Article 3.1 commitments
Projected
emissions
Mechanisms
acquisitions
LULUCF activities
<
=
>
Total Annex A
emissions
Emissions side
Annex B
assigned
amount
Assigned amount side
Kyoto Compliance Architecture
Joint
Implementation
National
Registries
Reporting of
quantitative
information
International
Transaction Log
CDM
Compilation and Accounting Database
(emissions, assigned amount information,
mechanisms eligibility)
GHG National
Systems
Reporting of
qualitative
information
Review
process
Compliance
Committee
COP/MOP
Role of reporting, review and
compliance procedures in
accounting for emissions and
assigned amount
Reporting, review and compliance procedures
 Enable establishment, suspension and reinstatement
of mechanisms eligibility
 Verify that Party is accounting for emissions and
assigned amount correctly
 Result in official data for compliance purposes
 Enable determination of Parties’ compliance with
Article 3.1 commitment at end of commitment period
Kyoto Protocol accounting
Annex I Party
systems
National
systems
National
registries
Eligibility
requirements
Reporting
process
Kyoto
Protocol units
Emissions
inventories
Review and
compliance processes
Secretariat
compilation
and accounting
database
Emissions
2008 - 2012
>
=
<
Assigned
amount
2008 - 2012
Article 3.1
compliance
assessment
Review Tasks related to accounting

Review inventories, and where appropriate,
recommend application of adjustments

Review transactions of Kyoto Protocol units and,
where appropriate, recommend corrections

Review implementation of requirements related to
mechanisms eligibility

Raise questions of implementation for consideration
by the Compliance Committee
 All QUIs related to accounting considered by
Enforcement Branch
Inventory Adjustments

Intended to correct problems for purpose of accounting for
emissions and assigned amount

Recommended by ERT when inventory incomplete or
inconsistent with IPCC good practice guidance
 Party provided opportunity to correct problem
 Applied with consent of Party or by Compliance Committee

Always result in conservative estimate
 BY emissions reduced
 CP emissions increase

Adjustments to CP inventories may have consequences for
mechanisms eligibility
Eligibility to Participate in the Kyoto
Mechanisms
Kyoto Mechanisms eligibility requirements

Participation in Kyoto mechanisms dependent on
compliance with specific methodological and
reporting requirements:






Party to the Kyoto Protocol
Initial assigned amount established
National System in place
National Registry in place
Annual Inventory
Annual information on assigned amount, and
accounted correctly
Eligibility Requirements by mechanism

Same six criteria apply, but consequences differ by
mechanism:
 Emissions trading:
Must
be in compliance with all requirements to transfer
or acquire units
 Joint Implementation:
Track
one: Must meet all requirements
Track two: Must have national registry in order to
issue and transfer ERUs
 CDM:

Must meet all requirements in order to use CERs,
tCERs and lCERs
Inventory eligibility requirement

Decision 15/CMP.1 specifies that a Party will fail to meet the
annual inventory requirement if and only if:
 Inventory not submitted w/in 6 weeks of due date
 Omission of Annex A key source that accounts for 7% or more
of annual emissions
 Total adjustments to Annex A sources in a year of the
commitment period exceeds 7% of submitted emissions
 At any point in time, sum of adjustments across years of the
commitment period exceeds 20% compared to submitted
 An adjustments is applied in three consecutive years to key
source that accounts for 2% or more of Annex A emissions
Reporting requirements for eligibility

National Inventory
 Initial report, Annual reports beginning in 2007
 All
years from BY to most recent within 6 weeks of due date
 All sectors (Annex A and Convention LULUCF Tables)
 No omissions of Annex A sources of 7% or more
 Beginning in 2010
 Submission
of KP LULUCF
 Magnitude of adjustments for Annex A emissions apply

Annual AA information starting year after first transfer or
acquisition of Kyoto Protocol units
 If
transfer in 2008, report in 2009
Process for establishing eligibility

Normal outcome of reporting, review & compliance
procedures

Automatically eligible 16 months after submission of initial
report, unless Enforcement Branch determines at an earlier
date that Party fails to meet one or more of the requirements

Party remains eligible until and unless Enforcement Branch
suspends eligibility

If suspended, Party can request reinstatement
 Directly to Compliance Committee
 Through the Review Process (expedited review procedures)
Accounting before, during and after
commitment period
Initial Accounting

Submission and review of initial report leads to
 Establishment of initial assigned amount in tonnes of CO2 eq
 Determination of Party’s eligibility to participate in each of the
Kyoto mechanisms
 Recording of parameters for LULUCF accounting

Possible adjustments to BY emissions, and consequent
reduction in initial assigned amount

Following review & resolution of any QUIs by compliance
committee, data recorded in CAD and provided to ITL
 Registry can now issue AAUs
 If eligible, can begin transferring and acquiring Kyoto Protocol
units
Annual Accounting
2007 – 2009

Submission of annual report voluntary under Kyoto, but…
required for full eligibility to participate in the Kyoto
Mechanisms
 Convention inventory
 AA information, when applicable

Inventories not subject to adjustment during this period

Party’s holdings of Kyoto Protocol units recorded annually in
CAD, after review & resolution of QUIs
 Compliance with mechanisms eligibility requirements updated
as necessary and provided to ITL

Eligible Parties continue to transfer and acquire units
Reporting of assigned amount info

Decision 15/CMP.1 requires information on its
aggregate holdings and transactions of Kyoto
Protocol units in its annual report.
 begin submitting this information the year after it first
transfers or acquires units (probably in 2009)

Decision 14/CMP.1 adopted Standard Electronic
Format (SEF) for reporting Kyoto Protocol units
 Information from national registry
 Summary of holdings and transactions of Kyoto
Protocol units for previous calendar year
SEF Tables

Aggregate holdings of Kyoto Protocol units at the
beginning and end of the previous calendar year by
unit type and account type.

Summary of transactions
 Internal transactions (issuance, cancellation,
retirement, etc.)
 Transfer to and acquisitions from other registries

Expiration and replacement of tCERs and lCERs

Cumulative additions to and subtractions from
assigned amount to date
Example SEF Table
Party
Submission year
Reported year
Commitment Period
Table 2 (a). Annual internal transactions
Additions
Subtractions
Unit type
Transaction type
AAUs
ERUs
RMUs
CERs
Unit type
tCERs
lCERs
tCERs
lCERs
Article 6 issuance and conversion
Party-verified projects
Independently verifed projects
Article 3.3 and 3.4 issuance or cancellation
3.3 Afforestation and reforestation
3.3 Deforestation
3.4 Forest management
3.4 Cropland management
3.4 Grazing land management
3.4 Revegetation
Article 12 afforestation and reforestation
Replacement of expired tCERs
Replacement of expired lCERs
Replacement for reversal of storage
Replacement for non-submission of certification report
Other cancellation
Sub-total
Retirement
Unit type
Transaction type
Retirement
AAUs
ERUs
RMUs
CERs
AAUs
ERUs
RMUs
CERs
tCERs
lCERs
Annual Accounting 2010 – 2013

Annual reports mandatory:






Convention inventory + KP LULUCF
Accounting for annually elected LULUCF activities
SEF information
Changes in national systems and registries
(3.14 info required, but not relevant for accounting)
Adjustments
 May be applied for Annex A emissions
 May be applied for annually accounted LULUCF
activities
Annual Accounting 2010 – 2013

Information recorded annually in CAD:
 Annex A emissions & any adjustments applied
 For annually accounted LULUCF activities,


Net emissions/removals and any adjustments applied
Accounting quantity
 Holdings and transactions of Kyoto Protocol units
 Compliance with mechanisms eligibility requirements updated
as necessary

Registry must issue or cancel units for annually accounted
LULUCF activities each year

Eligible Parties continue to transfer and acquire units
Annual Accounting 2014

Annual Report
 Final inventory data for commitment period (Last
chance to recalculate emissions & removals)
 Accounting for CP-accounted LULUCF activities

Information recorded in CAD
 Total Annex A emissions for commitment period
Indicates
total quantity of units to be retired
 Final accounting quantity for all 3.3 and 3.4 activities
(annual and CP accounting)
Annual Accounting 2014

After review and compliance procedures complete
for all Parties, ‘true-up period’ begins
 Exact date to be determined by COP/MOP decision

Registry must undertake final transactions of Kyoto
Protocol units
Transfers
& acquisitions of KP Units
All issuance/cancellation for CP-elected LULUCF
activities
Retirement of sufficient units to cover total Annex A
emissions
2015 Accounting

True-up period report
 AA information for 2014 calendar year + true-up period in 2015
 All units retired for commitment period
 All units that Party wishes to ‘carry-over’ to next commitment
period

Review tasks
 Total Annex A emissions ≤ retired units?
 Check units available for carry-over

Compliance determination:
 Deduction of units at 1.3:1 for excess emissions
 Suspension of transfer rights for non-compliance

Following review and compliance procedures
 Registry can initiate carry-over of valid units
 Any Party found in non-compliance must cancel units from 2nd
commitment period accounts
Summary of Information required
in Annual Reports
Reporting Element
2007
2008
2009
2010
2011
2012
2013
2014
Convention Inventory
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
KP LULUCF
Inventory
SEF & AA
information
Calculation of AQ for
Annual LULUCF
activities
○
●
●
●
Calculation of AQ for
CP LULUCF
activities
3.14 Information
(not relevant for
accounting)
2015
(True-up
report)
●
●
●
●
●
Units Retired
●
Units for carry-over
●
Accounting for LULUCF Activities
under Articles 3.3 and 3.4
General approach to LULUCF Accounting

Accounting frequency for each 3.3 activity and each elected
3.4 activity indicated in Party’s initial report
 For annually elected activities, Party must issue or cancel units
corresponding to net removals or net emissions from that
activity following review and compliance procedures in each of
years 2010 – 2014
 For commitment period elected activities, Party must issue or
cancel units corresponding to net removals or net emissions
over the entire commitment period following review and
compliance procedures in 2014 only

Parties report
 Emissions
and removals (in KP CRF tables) reported annually,
regardless of accounting frequency for the activity
 Calculation of the ‘accounting quantity’ only when activity is
accounted
The Accounting Quantity for LULUCF activities

Represents the cumulative obligation to issue or cancel units
to date for a given CP year
 A negative AQ indicates cumulative net removals
 issuance of RMUs
 A positive AQ indicates cumulative net emissions
 cancellation of units

For CP-elected activities, AQ will be calculated and reported
only once in 2014

For annually-elected activities, AQ will be calculated and
reported annually and will capture all emissions and
removals to date (E.g. 2011 AQ will be based on net
emissions and removals in 2008 and 2009)
 Will capture any recalculations of estimates for previous CP
years
Issuance and Cancellation

AQ to be calculated by Party, in accordance with
sinks accounting rules and checked by ERT
 Any adjustments applied to emissions and removals
for an activity will be result in modification of
accounting quantity

AQ will be recorded in CAD and provided to ITL

Party’s national registry can then issue or cancel
units
 Quantity of units to be issued or cancelled at any
point in time depends on AQ, and quantity of units
previously issued or cancelled
Relationship of AQ to issuance & cancellation
Submission
Year
2010
2011
2012
2013
2014
Inventory
Year
2008
2008
2009
2008
2009
2010
2008
2009
2010
2011
2008
2009
2010
2011
2012
Net
Emissions &
Removals
-15
-15
-15
-15
-15
-15
-15
-15
-15
-15
-10
-10
-10
-10
-10
Accounting
Quantity
Action
-15
Issue 15 RMUS
-30
Issue 15 RMUs
-45
Issue 15 RMUs
-60
Issue 15 RMUs
-50
Cancel 10 units
Example Calculation of LULUCF AQs
Net emissions/removals (1)
GREENHOUSE GAS SOURCE AND SINK
ACTIVITIES
2008
BY
2009
2010
2011
2012
Accounting
Quantity (2)
Accounting
limits
Total
(Mt CO2 equivalent)
A. Article 3.3 activities
A.1. Afforestation & Reforestation
A.1.1. Units of land not harvested since the beginning
of the commitment period
A.1.2. Units of land harvested since the beginning of
the commitment period
Unit A
Unit B
Unit C
Unit D
Unit E
A.2. Deforestation
B. Article 3.4 activities
B.1. Forest Management (if elected)
FM cap
3.3 offaset
B.2. Cropland Management (if elected)
B.3. Grazing Land Management (if elected)
B.4. Revegetation (if elected)
-75
-2
-10
-10
-10
-10
-40
-40
-2
-4
-4
-3
-5
-30
-2
10
-3
10
-5
200
-5
-3
-2
0
-5
0
-3
-6
15
-4
-5
-10
-12
-3
6
3
-20
160
-35
-12
-3
0
0
-20
160
-60
-80
-60
-40
-240
-10
-10
-10
-150
65
-65
85
-85
-28
-16
-6
-36
-8
20
0
5
-2
-3
-3
-4
-12
0
-3
-3
-5
-5
-16
-32
Reference Manual on accounting
of emissions & assigned amount

Why Reference Manual?
 Rules for implementation of the Protocol are
scattered across numerous decisions
 Many questions from Annex I Parties regarding
requirements for implementation of the Protocol
 Need to facilitate a common, consistent approach by
experts and institutions involved in supporting and
assessing implementation – Parties, ERTs,
Compliance Committee, Secretariat

Available November, 2007?
Reference Manual Contents

Overview of Kyoto Protocol and Principal Commitments
 Particular focus on requirements and systems that relate to
accounting of emissions and assigned amounts

Process for accounting for emissions and assigned amount
prior to, during and after commitment period

Requirements for participation in the Kyoto Protocol
mechanisms
 Eligibility criteria
 procedures for establishment, maintenance, suspension and
reinstatement of eligibility

Detailed chapters on requirements related to accounting of
emissions and assigned amount