Government of Canada’s direct greenhouse gas emissions: Methodology

Methodology used to account for greenhouse gas emissions

The methodology selected for quantifying GHG emissions from federal operations is meant to:

• reasonably minimize uncertainty
• yield accurate and consistent results
• be technically feasible and cost-effective

Federal organizations follow the Federal GHG Accounting and Reporting Guidance, which provides direction on calculating and reporting GHG emissions in accordance with the Greening Government Strategy. The methodology is based on the GHG Protocol: A Corporate Accounting and Reporting Standard, developed by the World Resources Institute and the World Business Council for Sustainable Development. The GHG Protocol is an internationally accepted standard for GHG accounting at the organizational level.

Over time, additional sources of GHG may be added and adjustments to methodologies may be made in order to improve the federal government’s accounting for and reporting of GHG emissions from federal operations.

Emission factors

• GHG emissions are determined using activity data (for example, energy data) in conjunction with an appropriate emission factor
• Emission factors are calculated ratios that relate GHG emissions to a measure of activity at a specific emissions source
• Emission factors are usually expressed in terms of GHG emissions per unit of fuel or energy
• Emission factors used to calculate GHG emissions from federal operations are sourced from the national inventory report: greenhouse gas sources and sinks in Canada, published by Environment and Climate Change Canada

Global warming potentials

• GHGs are converted into units of carbon dioxide equivalent (CO2 eq) by multiplying the emissions of each gas by its global warming potential
• Global warming potential is a factor that describes the degree of warming that results from one unit of a given GHG relative to one unit of CO2
• The global warming potential of methane (CH4) and nitrous oxide (N2O) are 28 and 265 respectively, based on the Intergovernmental Panel on Climate Change, Fifth Assessment Report, 2014

Market-based Instruments

When energy is delivered through shared distribution systems such as electricity grids or pipelines, energy comes from mixed sources. As a result, energy used at a specific location cannot be physically traced back to a specific generation source or its emissions profile. Market-based instruments address this by separating the environmental benefits of clean energy from the physical delivery. The benefits are assigned to an equivalent amount of consumption through contractual arrangements. These instruments are tracked and verified to ensure claims are unique and avoid double counting. The price premium for the emissions reduction benefit provides a financial incentive for providers to increase the supply of clean energy.

1. Electricity (Scope 2 emissions)
   • A kilowatt hour of electricity used from the local grid may have a high emissions factor. To compensate for the emissions, the emissions reduction from a kilowatt-hour of electricity from a non-emitting renewable source can be purchased and claimed against the actual emissions.
   • This can be established with a contractual arrangement for the procurement of clean electricity from specific sources via Power Purchase Agreements (PPAs) or Renewable Energy Certificates (RECs). In either case, the electricity purchased is supplied to the grid but may not necessarily be directly consumed by the purchaser. Nonetheless, an emissions reduction occurs regardless of who consumes the electricity.
   • A REC is a mechanism that certifies ownership of one megawatt hour (MWh) of electricity generated from renewable sources, in addition to the associated reduction in emissions. RECs provide a financial incentive to generators to add more renewable electricity supply (such as wind and solar) to the grid, which may displace sources that emit GHGs. The Government of Canada (GC) prefers to buy RECs or clean electricity in the province where the electricity is consumed.
   • The GC requires that REC purchases be additional, meaning that emission reductions must come from new, clean energy supply to the grid that would otherwise not exist without the financial incentive.
   • For reporting purposes, emissions for the actual electricity consumption from the grid is reported using the grid emission factor. These are the location-based emissions. Then, emissions are reported taking into account reductions from market mechanisms (such as RECs). These are the market-based emissions. The difference between the location and market-based emissions is the reduction achieved by the RECs.
2. Low carbon fuels (Scope 1 emissions)
   • Departments are purchasing low-carbon intensity fuels (LCF) such as sustainable aviation fuel, renewable diesel and biodiesel to reduce emissions from their air and marine fleet operations.
   • LCFs release fewer GHG emissions over their life cycle than the conventional fossil-based fuel that they replace or are blended with. The LCFs purchased to date are biofuels. In accordance with the Federal Accounting and Reporting Guidance, and the GHG Protocol, the combustion emissions from these LCFs are considered to be net-neutral biogenic emissions and their use leads to approximately 99% Scope 1 emissions reductions.
   • Departments use chain-of-custody market-based instruments such as book and claim and mass balance where there are significant logistical or supply challenges with blending, transporting and/or delivering LCFs for federal operations (e.g., when refueling from shared infrastructure at marine and air ports).
   • These market-based instruments allow organizations to purchase and certify ownership of the emissions reductions associated with LCFs that they do not directly consume.
   • Emissions reductions associated with the use of these instruments are tracked and reported separately from direct Scope 1 emissions for the purpose of demonstrating progress towards the Greening Government Strategy targets.

Additional notes

• Some year-to-year changes in GHG emissions may be due to data collection gaps, methodology or error correction refinements, while others may be the result of one-time or specific events or actions (such as natural disasters or operational disruptions)
• Variations in seasonal weather conditions (for example, the effect of heating or cooling days on building energy use) also influence annual GHG emissions