TCNC's process for selecting and verifying projects

The first step is to assess how the project is helping to reduce emissions and to produce a 'Project Design Document' >> more 
                 

The project design is independently validated to ensure the project meets all the relevant criteria and standards >> more

Each year, the actual volume of emission reductions generated by the project is verified by an independent third party >>  more
                                                                                         

Project Design

The first step in the project cycle is to assess the project and prepare documentation that will be used to evaluate whether it qualifies as an emissions reduction activity.

The Project Design Document (PDD) is written by a consulting firm with experience both in the carbon business and the specific project technology.  In working with the project developer, they will address a number of areas:

Project Description:  Where is the project, what technology is being used, who is the project developer and how does the project contribute to sustainable development?

Project Additionality:  Is the project activity helping to bring about emission reductions that otherwise would not have happened?  The project cannot be the ‘business as usual’ scenario, otherwise it cannot be said that the project is giving rise to additional emission reductions.

Calculation of Emission Reductions:  How many tonnes of emissions is the project saving from being emitted into the atmosphere?  To calculate this, the project baseline is identified.   For example, in the case of a renewable energy project that delivers electricity to a grid, the baseline is the average emissions per kilowatt hour of electricity delivered to the grid (there will be fossil fuel power stations delivering to the grid).  The emission reductions generated by the project are the difference between the baseline emissions and the direct emissions associated with the project activity.

Impact Assessment:  Does the project have any adverse effects on the local community and environment?  The PDD must demonstrate that these impacts have been considered and assessed.

Monitoring Plan:  How will the emission reductions generated by the project be monitored, what data is required and how will it be collected?   The monitoring plan is put forward to show that the project developer will be able to demonstrate credible and transparently the volume of emission reductions delivered by the project.

Project Validation

Project validation is a combination of desk review and site visit, and it is critical in ensuring that the project will be able to deliver as described in the project design document (PDD).  Is the project description accurate, is the project truly ‘additional’, have the emission reductions been calculated accurately and does the project developer have legal title to them, does the project have the approval of local stakeholders, are the environmental impacts as stated in the PDD and is the monitoring plan workable?

Assuring all of this is part of meeting the requirements of the CarbonNeutral Protocol, which is the independently reviewed standard to which we work.  Our technical advisor, the Edinburgh Centre for Carbon Management (ECCM), assesses the project against the protocol and produces a validation report.

Clean Development Mechanism (CDM) projects and projects certified to the Voluntary Carbon Standard and the Gold Standard will also be validated by a Designated Operational Entity (DOE), as stipulated by those standards.  A DOE is an entity, normally a consulting company, accredited by the UNFCCC to perform project validation and/or verification of emission reductions.  

Project Verification

Once the project is operational, it is starting to reduce emissions.  However, the emission reductions only acquire value with their verification.  Verification is the ex-post determination of the reductions in emissions, as determined by an entity independent of both the project developer and the purchaser of the emission reductions.

The project developer monitors the project as specified in the project design document.  On an annual basis, a monitoring report is prepared, which estimates the emission reductions generated by the project during the year.  This report is submitted for detailed review by the independent entity, which then certify the amount of emission reductions.

For Clean Development Mechanism (CDM) projects and those certified to the Voluntary Carbon Standard (VCS) and the Gold Standard, verification will always be performed by a Designated Operational Entity (DOE).  We will also use a DOE for verification of VER projects when the project is of sufficient scale to support the cost.  For smaller projects, and particularly where there is no DOE locally available, we choose instead to commission with local consulting companies to conduct verification.

The verification report is critical to the issuance of the emission reductions.  The CDM Executive Board can issue Certified Emission Reductions (CERs) only on receipt of the verification report.  Likewise, the owner of the VCS registry can only create Voluntary Carbon Units having reviewed the verification report.  Gold Standard emission reductions are also kept in a registry.  In addition, all emission reductions we purchase will be tracked via our soon to be launched on-line registry.