Carbon Neutral Challenge

1
Carbon Neutral Challenge
January 7, 2008
2
Agenda

• Introductions
• Review the status of the initiative
• GHG inventory results
• Our approach to mitigation
• Phase 1 mitigation plan
• Looking forward
• Conclusion
• QA

3
Carbon Neutral Challenge (CNC) Update

• Began with a bold commitment by 30 wineries
• Data collection has been completed by 13 CNC
  participants
• Average data collection time was 10 hours
• 13 Greenhouse Gas (GHG) Inventories have been
  completed as of December 2008
• Phase 1 Mitigation Plan presented to all CNC
  participants in October 2008

4
CNC Successes

• This is the first time that government agencies,
  non-profits and industry trade groups have
  collaborated to assess and reduce their carbon
  footprint, with the ultimate goal of becoming
  carbon neutral
• 13 CNC participants now know their annual GHG
  emissions baseline, or their operational carbon
  footprint
• This calculation is a first-step toward reducing
  your organizations impact on the climate, and
  taking your part to reduce the effects of climate
  change
• When implemented, the recommendations in the
  Phase 1 Mitigation Plan will create opportunities
  for immediate savings, and create the foundation
  for long-term success

5
GHG Inventory Results
GHG Emissions Summary
6
GHG Inventory Results
Comparison of Scope 1 and Scope 2 GHG Emissions
Scope 1 and Scope 2 GHG Emissions Sources
GHG Emissions by Sector
7
Average Scope 1 and Scope 2 GHG Emissions Sources
8
Our Approach to Mitigation

• Best practice for organizations and individuals
  seeking carbon neutral status entails reducing
  and/or avoiding carbon emissions first so that
  only unavoidable emissions are offset

9
Value of Direct Emission Reductions

• Today, capital investments are made irrespective
  of the cost of carbon
• While Oregon wineries are not likely to be
  regulated by anticipated federal legislation, the
  cost of purchasing offsets will increase with an
  economy-wide cap
• This will incentivize strategically investing in
  direct emissions reductions

10
Phase 1 Mitigation Plan

• Designed to balance two objectives
• Realize opportunities for immediate savings
• Create the foundation for long-term success
• Long-Term Foundation
• Organizational Development Strategies
• Systems Monitoring and Controls
• Savings Opportunities
• Lighting Retrofit
• Tank Insulation
• Space Partitioning
• Maintenance Programs

11
Cost of Purchasing Offsets

• CNC participants annual GHG emissions ranged
  from 5 to 1,800 MtCO2e
• This example uses the average annual emissions
  baseline from CNC participants, 370 MtCO2e, and
  assumes 2 annual growth
• Cumulative cost of achieving carbon neutrality by
  2030 is 246,921

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Future Cost of Carbon
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Example with Direct Emissions Reductions

• Lets use the same example as before, a winery
  emitting 370 MtCO2e annually, but instead of
  assuming 2 growth, well assume a 2 reduction
  in annual emissions
• By investing in direct emissions reductions, this
  winery will achieve carbon neutrality for
  106,407 less than if it had purchased offsets
  annually

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Direct Emissions Reductions - Lemelson
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Lighting Opportunities

• Recommendation Replace all 1000W 400W metal
  halides with T-5 fixtures and install motion
  sensors
• Total Initial Investment 12,600
• Includes fixtures, sensors, and labor
• Simple process to switch out fixtures
• Total Rebates 11,400
• Energy Trust of Oregon 4,700
• Oregon Business Energy Tax Credit 4,400
• Federal Tax Deduction 2,300
• Annual Lighting and Maintenance Savings 880
• Pay Back 1.4 years
• Lemelson has a low burn time savings will
  increase if burn time is higher

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Pump Opportunities

• Recommendation Install Variable Frequency
  Drives (VFDs) to Pump Systems
• Allow only needed water flow (20-30 reduction)
• Affects flow, pressure, and power throughout the
  system (50-80 energy savings)
• Few piping or electrical system changed required
• Can be completed by facility maintenance staff
• For the new purchase of a 2 HP pump with VFD
• Investment 1,500
• Pay Back 1.36 years
• Energy Trust of Oregon Rebate 3 HP 700, 5 HP
  900
• Pay back even greater if
• Take advantage of rebates
• Purchasing a VFD for an existing system

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Direct Emissions Reductions Kendall-Jackson
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CNC Lessons Learned

• Being carbon neutral, or achieving net zero
  carbon emissions by balancing a measured amount
  of carbon released with an equivalent amount
  sequestered or offset, is incredibly difficult.
• Scientific uncertainty regarding the short-term
  carbon cycle
• Lack of singular definition of carbon neutrality
• Lack of regulation and scrutiny of the new carbon
  offset market
• The importance (and cost) of verifying carbon
  accounting
• Uncertainty regarding model protocols and
  industry best practices
• The time and energy to collect necessary data and
  implement recommendations
• Timely and effective communication to diverse
  stakeholders

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Looking Forward

• Originally, the goal was for all CNC participants
  to achieve carbon neutrality by February 2009
• This goal no longer seems reasonable for several
  reasons
• Only 13 of 30 wineries currently have documented
  emissions baselines
• We would like all wineries and vineyards with a
  vested interest in reducing their GHG emissions
  to participate in the process
• We want to give each CNC participant adequate
  time to invest first in direct emissions
  reductions
• We recommend extending the timeline for achieving
  carbon neutrality to 2011

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Long-Term Strategy of the CNC

• We would like all wineries who havent yet done
  so to collect data necessary to evaluate their
  2008 emissions baseline
• In the next 10 months all CNC participants should
  implement relevant Phase 1 Mitigation Plan
  recommendations
• The Phase 2 Mitigation Plan will be developed and
  distributed to CNC participants in October 2009
• All CNC participants should implement relevant
  Phase 2 recommendations in 2009 and 2010
• All CNC participants will again report their 2010
  emissions in 2011
• In early 2011, CNC participants will receive
  final recommendations for purchasing offsets
• During this time, progress will be made toward
  development of a regional offset project

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Conclusions

• Achieving carbon neutrality is a very difficult
  thing to do
• It is in all CNC participants best interests to
  make capital investment decisions based on our
  anticipated transition to a carbon-constrained
  economy
• Doing so will create a lasting competitive
  advantage, and protect you from green washing
  claims
• Were learning as we go and leading the way

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Contact Information

• Brad Ouderkirk
• bouderkirk_at_ecosconsulting.com
• 503.525.2700, x 164
• Ann Radil
• aradil_at_ecosconsulting.com
• 503.525.2700, x 133
• Andrea Durbin
• andread_at_oec.org
• 503 -222-1963,  x 104
• Hannelore Buckenmeyer 
• hannelore_at_oregonwine.org
• 503.228.8336 , x 23 

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• Thank You