For gas distribution businesses this means that any corporations whose emissions are expected to be above 125 kilotonnes or who control a facility emitting more than 25kilotonnes for the period 2008 – 09 will have to register by 31 August 2009 and report by 31 October 2009. The data will have to be lodged with the Greenhouse and Energy Data Officer (GEDO), within the Department of Climate Change (DCC).
The NGER Regulations – both the NGER (Regulation) 2008 and the NGER (Measurement) Determination 2008 – have been listed on the Federal Register of Legislative Instruments. Associated NGER Reporting Guidelines are also available on the DCC website at
www.climatechange.gov.au/reporting
For gas distributors that meet the reporting threshold requirement, the above means that they must commence the collection of greenhouse gas emissions data from now on. As part of the reporting process, corporations will have to carefully consider how they will estimate their fugitive gas emissions. While one option is for a distributor to collect data from their network as a basis for reporting, this is likely to be costly and will only be accepted if it can be shown to be superior to the default methods in the Regulations. There are two default methods available in the NGER (Measurement) Determination 2008 (Division 3.3.8)
Method 1 (Section 3.80)
This approach estimates gas leakage from pipelines though the apportionment of unaccounted for gas (UAG). The formula applied in the regulations is:
Eij = Sp x %UAGp x 0.55 x Ci,p,j
where:
Eij is the fugitive emissions of gas type (j) that result from natural gas distribution through a system of pipelines with sales of gas (Sp) during the year, measured in CO2 e tonnes.
Sp is the total gas sales during the year from the pipeline system measured in terajoules.
%UAGp is the percentage of unaccounted for gas in the pipeline system in a state or territory, relative to the amount of gas issued annually by gas utilities in that state or territory.
Note: The value 0.55 following the variable %UAGp in Method 1 represents the proportion of gas that is unaccounted for and released as emissions.
Ci,p,j is the natural gas composition factor for gas type (j) for the natural gas supplied from the pipeline system in a State or Territory measured in CO2 e tonnes per terajoule.
Method 2 (Section 3.81)
The approach relies on the American Petroleum Institute’s (API) Compendium of Emissions Estimation methodology which allows for the derivation of fugitive emissions by distribution component type. The formula applied in the regulations is:
Ej = ∑k (Qk x EFjk)
where:
Ej is the fugitive emissions of gas type (j) that result from the natural gas distribution during the year measured in CO2 e tonnes.
Σk is the total of emissions of gas type (j) measured in CO2 e tonnes and estimated by summing up the emissions from each equipment type (k) listed in sections 5 and 6.1.2 of the API Compendium, if the equipment is used in the natural gas distribution.
Qk is the total of the quantities of natural gas measured in tonnes that pass through each equipment type (k) or the number of equipment units of type (k) listed in sections 5 and 6.1.2 of the API Compendium, if the equipment is used in the natural gas distribution.
EFjk is the emission factor for gas type (j) measured in CO2 e tonnes for each equipment type (k) listed in sections 5 and 6.1.2 of the API Compendium, if the equipment is used in the natural gas distribution
The Energy Network Association (ENA) has raised its concerns with Method 1, questioning the validity of applying the UAG as the basis of deriving the portion of unaccounted for gas that can be attributed to greenhouse emissions. ENA argues that UAG is primarily used in financial reconciliation. It represents a residual number being the difference between gas received or purchased for a specified period and the estimated amount of gas measured or billed leaving the network for the same period. It has been demonstrated on numerous occasions over the past ten years that significant movements in the reporting of UAG for gas networks relate primarily to metering malfunctions of systemic calculation errors rather than gas leakage. Therefore Method 2 is the preferred option where it can be applied.
Looking forward, ENA expects that the increased use of higher quality piping materials will lead to a reduction in gas leakage rates. To reflect this trend the gas distribution sector will need to establish standardised leakage rates that better reflect the situation on the ground than the present default methods.