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CSR Charter ⅡHarmonizing with the Environment and Contributing to Realizing a Sustainable Society

Actions for Climate Change: Method to Evaluate Effects of CO2 Emissions Reduction

Adequate Method to Evaluate Effects of CO2 Emissions Reduction

Effects on reducing CO2 emissions through the reduction of electricity consumption

As CO2 is not emitted where electricity is used, the CO2 emitted at the power plant is considered as being emitted by the customer. This also applies when customers strive to conserve energy, and it is necessary to consider this as the CO2 reductions at the power plant. To do this, it is necessary to identify the power sources whose annual power generated are impacted by demand fluctuations. These are known as marginal power sources. Using the CO2 emission factors of these sources is appropriate to calculate reduced CO2 emission by energy saving efforts by customers.

Method for evaluating the impact of reduced CO2 emission

What is the Marginal Power Source in Japan?

The power sources of Japan include thermal, nuclear and hydro power generation. Nuclear power plants continually generate power except when they are undergoing periodical inspections. Due to their low operational costs, hydro power plants are operated at full capacity and the amount of power generated annually is determined by the amount of precipitation (rain and snow). On the other hand, the amount of power generated by thermal power is adjusted to meet demand and so thermal power is considered the marginal power source in Japan.

Electricity Production by Type of Power Source (Before the Great East Japan Earthquake)

Electricity Production by Type of Power Source (Before the Great East Japan Earthquake)

Formula for calculating CO2 emissions reductions

The following formula is the proper method for calculating CO2 emissions reductions due to reduced electricity consumption using the average CO2 emission factor of the thermal power sources as the marginal power source.

Formula for calculating CO2 emissions reductions
* Source
The emission factors of thermal power sources applied in “The Plan for Global Warming Countermeasures” adopted by the Cabinet meeting in May 2016.
FY2014: 0.65 kg-CO2 / kWh
FY2031: 0.66 kg-CO2 / kWh

Average Emission Factor (AEF) for all power sources and the Marginal Emission Factor

Generally, CO2 emissions are estimated using the average factor for CO2 emissions for all types of power sources including nuclear, hydro and thermal (Average Emission Factor (AEF)). However, if the AEF is used to estimate CO2 emissions reductions, nuclear and hydro power, which do not change with fluctuations in demand, are considered also to have been reduced. As a result, proper evaluations of CO2 emissions reductions should use the marginal emission factor, which in Japan is the average CO2 emission factor of the thermal power sources.

As an example, calculated using the emission factors of FY2031, suggests that it is possible that CO2 emissions reduction evaluations based on AEF will underestimate the effect of introducing solar, wind, biomass, and other alternative energy sources on global warming.

Emission Factors Used in the Example Calculation

Average Emission Factor (AEF) for all power sources Marginal Emission Factor
(emission factor for all thermal power sources)
0.37 kg-CO2 / kWh 0.66 kg-CO2 / kWh

Example of Underestimation of CO2 Emissions Reductions when Using AEF

Example of Underestimation of CO2 Emissions Reductions when Using AEF

International / domestic standards for CO2 reduction assessment

International standards dictate that CO2 reductions as a result of reduced electricity purchased should be calculated using the marginal emission factor (in Japan, the average emission factor of the thermal power sources). This practice is employed in the Clean Development Mechanism (CDM) process, one of the mechanisms of the United Nation's Kyoto Protocol, as well as international standards such as the Guidelines for Quantifying GHG Reductions from Grid-Connected Electricity Projects, part of the GHG (Greenhouse Gas) Protocol Initiative.

In Japan, the government guidelines for energy conservation include information regarding this method.

Government guidelines employing the Marginal Emission Factor (the average factor of thermal power sources)

The Plan for Global Warming Countermeasures adopted at the Cabinet meeting in May 2016

Average emission factor for all power sources in FY2014: 0.57 kg-CO2 / kWh; average emission factor for thermal power sources: 0.65 kg-CO2 / kWh

Average emission factor for all power sources in FY2031: 0.37 kg-CO2 / kWh; average emission factor for thermal power sources: 0.66 kg-CO2 / kWh

[Reference]
“Interim Summary Report by Target Attainment Scenario Subcommittee” compiled by the Global Environmental Committee, Central Environmental Council (2001)

Average emission factor for all power sources: 0.36 kg-CO2 / kWh; average emission factor for thermal power sources: 0.69 kg-CO2 / kWh

Environmental Reporting Guidelines (FY2013) published by the Ministry of the Environment (April 2012)

Average emission factor for all power sources: 0.36 kg-CO2 / kWh; average emission factor for thermal power sources: 0.69 kg-CO2 / kWh

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