using the unfc-2009 to classify renewable energy resources ablc 2014 washington, d.c. raffaella...

Using the UNFC-2009 to classify

Renewable Energy Resources

ABLC 2014Washington, D.C.

Raffaella CristanettiDuPont Industrial Biosciences

Presentation Objectives

• Review an ongoing initiative to develop a framework for estimating and classifying Renewable Energy resources

• Highlight key elements of the proposed draft Renewable Energy Specifications document (Phase 1)

• Stimulate interest for additional stakeholder participation in the commodity sub-specifications workstreams (Phase 2)

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What is the UNFC?

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• United Nations Framework Classification for Fossil Energy and Mineral Reserves and Resources

• Global, generic, principles-based “umbrella” system– Solid minerals and fluids– Numerical coding system– Facilitates global communications

• Compatible, integral, and collaborative – CRIRSCO Template for minerals and PRMS for oil & gas

A consistent methodology across all Energy & Mineral resources, creates transparency and comparability

UNFC-2009 is and remains a voluntary system, intended as set of common rules that can be used by different stakeholders

Why consider renewables in terms of resources and reserves?

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• Enhanced overview of asset values• Provide a measure of comparability with traditional energy systems• Offer a basis to estimate the scale of each renewable resource• Provide reliable estimates based on best practices and common standards

Renewable asset

owners

External stakeholder

s

• Investment community– Better assess and contrast investment opportunities– Enhance portfolio valuation

• Governments– Better understand total resource base– Facilitate achievement of integrated energy strategy and policies

• Global organisations– Assess and contrast global energy systems and different energy

sources• Other external users (Interested public, accounting profession, technical

consultants, etc.)

UNFC – How it works

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• Socio-economic viability (E-axis): The social and economic conditions used to establish the commercial viability of the Project, including consideration of market prices and relevant legal, regulatory, environmental and contractual conditions.

• Project status and feasibility (F-axis): The maturity of studies and commitments necessary to implement the Project.

• Geological knowledge / uncertainties (G-axis): The level of confidence in the available data and potential recoverability of the quantities.

Resources are estimated and classified based on a “project”

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The project generally represents represent the level at which a decision is made whether or not to proceed (i.e., spend more money)

Renewable energy projects are very similar to fossil energy or mineral projects

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• A conventional resource represents an expectation of energy in place that can be economically produced / extracted and brought to market.

• A renewable energy resource represents an expectation of the renewable energy production potential that can be economically produced / converted and brought to market.

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A Renewable Fuel Example

Liquid Fuel

Solid Fuel

Source Processing Losses Marketable Energy Products

Storage

UNFC Common project characteristics:

• A defined level of investment, with an expected production profile

• Prerequisites such as gaining access to the resource and market, receiving authorization, and validation of the economic case

• As the project develops, risk declines and certainty of returns improves

April 2014 – ABLC Washington, D.C.Copyright © 2014 DuPont. All rights reserved.

Renewables vs. Non-Renewables

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Common Characteristics Key Differences

Projects have a defined level of investment, with an expected production profile

The renewable energy source does not deplete (SE4ALL definition: “… is replenished at a higher rate than consumed”)

Common prerequisites for project feasibility, such as gaining access to the resource and market, receiving authorization, and validation of the economic case

Geological risks do not apply to most Renewable energy projects, but similar uncertainties exist (e.g. meteorological variations, seasonal variations, etc.)

As the project develops, risk declines and certainty of returns improves

Structure and Contents of the Draft Specifications

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Key definitions

UNFC-2009: E,F,G tables

Generic specifications

Glossary of key terms

Next Steps: Important Work Remains

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Question Comments

Point of Reference / Measurement

• “Marketable Energy Products” Definition – Is wood an energy product ? • Treatment of non-energy co-products – Particularly where there is an option

to swing production between energy and non-energy products (e.g., sugar)• Energy used in conversion process

Access and Entitlement • Treatment of volumes produced using feedstock sourced from the market, rather than grown or sourced from land owned or leased?

• Treatment of lease extension / renewal?

Market Connectivity • How do we define/limit plant lifetime ?

Unit Conversion • Mbbl to Mboe ? • Twh to xxx ?

• The ECRG will review and consider for approval the draft Renewable Energy Specifications at their 5th Session April 29 – May 2, 2014 in Geneva

• Phase 2: (a) Subject to EGRC approval, public consultations on draft Specifications; (b) Development of commodity-specific specifications

Key Bioenergy Considerations

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Thank you!

Questions? Feedback?

All documents at:

http://www.unece.org/energy/se/unfc_re.html