1. Domestic offsetting:
A local Option
Liam Kinsella
Environment & Engineering Services Division

2. Outline
• Basic Information
• Domestic offsetting in agriculture and land use
– Options
– Opportunities
– Approaches
– Consideratons
• Summary
• Concluding remarks

3. Domestic offsetting
• Creation of tradable units of GHG emissions
reduction representing measured or estimated
results of mitigation projects.
• Article 24a(1) Dir 2009/29/EC “measures for issuing
allowances…in respect of projects administered by MS that reduce GHG
emissions not covered by the community scheme may be adopted”
• Similar to international mechanisms: CDM or JI
• Offsets achieved by financial support of projects to
• Reduce emissions of GHG - efficiency
• Increase sequestration

4. Sectors
• Land Based
– Land use Land Use Change and Forestry (ESD)
• Future afforestation
• Reduced losses of soil carbon, Soil C sequestration
• Energy production
• Agriculture
– Direct technical interventions
– By improving efficiency
• Waste
• Domestic
– Community heating scheme
• Transport

5. Potential Customers
• Government
– Avoid purchase of International Credits
– Retain funds in Ireland
– Promote preferred activities –
• Afforestation
• Technological innovation
• ETS
• Voluntary market
– Improve C foot print of products or services
– Individuals?
– Other farmers?

6. Issues for Consideration in DO schemes
• Additional Reductions or sequestration
– Compared to what would occur with existing measures
– Baseline is very important
– Need to avoid unearned credits
• Verification
– Can the emissions reductions be verified
– Inclusion in national Inventory
• Double counting
• Permenance
• Cost effectiveness
– Costs incurred in mitigation or sequestration action
– Administrative costs – overhead
• Scale of emissions reductions – cost per tonne

7. Offsets in agriculture/ land use sector
• Agricultural projection - baseline
– 12.5% decline compared to 1990 by 2020
– 10.7% decline compared to 2005 by 2020
• Agricultural mitigation
– Improved efficiency
– Technological interventions (~4% of projected emissions)
• Carbon sequestration
– Agricultural soils
• ~ 3.9 m ha of grassland, ~0.4 m ha of tillage crops
• But ag soils activities not reported
– Forestry: requires new planting
• Energy production
– Reduce fossil fuel use mainly outside sector

8. Opportunity for the sector
• Driver of Improved efficiency
• Income opportunity for farmers
• Driver for research and identification of:
- New technologies for:
• Mitigation
• Emissions measurement
- Development of methodologies
• Wider economic impact
- Domestic offsetting could represent a new market
- Providing opportunities for entrepreneurs

9. Options for Domestic offsetting
• Sequestration
– Forestry
• Good information available on sequestration capacity
• Additional bio-energy benefits,
• Long term storage of C in HWP
– Agricultural soils
• Flux measurements indicate sequestration
• Calculation rules are important
• Monitoring, Reporting and Verification
• Research requirement to develop
– Measurement technologies and methodologies
– Management interventions
• Agricultural mitigation
– Most current strategies benificial to the farmer or low cost
– Identification of additional strategies?
• Research ongoing but more required

10. MRV issues
• MRV is challenging
– Large variability in emissions
• Between systems – e.g. beef v dairy
• Within systems –depending on:
– Level of output, feed intake, diet, etc
– Natural variability between animals and breeds
– Soil type and climate and their interactions: management
– Agricultural systems are natural systems
• Uncertainty in emissions both methane and nitrous oxide
• Impact of mitigation strategy uncertain
• Internationally recognised issue
– How can emissions changes be monitored and verified?
– New Zealand experience
– Ag Work Programme in UNFCCC.
– Global Research Alliance on Agric GHG Emissions

11. Approaches in sector
• Farm level domestic offset project
– Could be mitigation or sequestration
– Requires identification of baseline at farm level
– Projects likely to be small
• ~130,000 farmers, Average farm emissions: ~140 tonnes
– MRV issues
• Sectoral approach
– Requires monitoring and verification
• Therefore need farm level information
• Uncertainty of impact
– Reduces administrative costs
– Actions required at farm level
– Transfer incentive to farm level?

12. Environmental integrity
• Can MRV be organised?
– Soil C may be particularly difficult
– More information required: both LULUCF and agricultural sector
• How to prevent perverse actions?
– To access payment in the future
– Trade off within project?
• Tools available
• Carbon leakage
– Increased emissions outside boundary
• Project
• Sector
• National

13. Commercial issues
• Irish Agric production is efficient
• But continuous improvement required
• C- footprint is a competitiveness indicator
– Assume credits sold to different sector.
– Impact on c-footprint of food produced?
• Demand for credits from agric sector
– Internal offsetting scheme?
– Impact on individual expansion – sectoral rationlisation?
– Impact on sector profitability
– Competition with other buyers?
– Capacity to meet growing food demand worldwide?

14. Summary
• Opportunites exist to establish DO schemes
– With particpation by Agricultural and Land use sectors
– Maybe other sectors also
• MRV might be difficult and expensive
– Natural systems
– Measurement technologies
– In particular verification is difficult
• Aim is to achieve cost effective emissions
reductions
– Of benefit to ag sector
– Assist in meeting national targets?
– Environmental integrity

15. Concluding remarks
• DAFF analysis to date
– Focused on mitigation
• Options
• Implications
– Leadership role in this area
• Future analysis
– Climate change adaptation
– Domestic offsetting
• Domestic offsetting
– Engagement with EPA project
– Implications for sector
– Can DO further improve contribution to mitigation
Sector, national, international