The document discusses carbon monitoring, reporting, and verification (MRV) in the EU Emissions Trading System (EU ETS) from the perspective of verifiers. It describes the roles of verifiers and operators in the MRV process. For verifiers, it outlines requirements for independence, accreditation, and maintaining quality systems. For operators, it discusses monitoring emissions according to regulations, submitting reports, and providing information to verifiers. It also identifies lessons learned, including the importance of accurate MRV for a credible emissions trading scheme and of guidance, preparation, and addressing issues identified during verification.

1. Improving performance,
reducing risk
Carbon Monitoring, Reporting & Verification (MRV)
The Verifier’s Perspective

2. Content
– MRV In the EU ETS, the role of
the verifier
– MRV in the EU ETS, the role of
operators
– Lessons Learnt

3. LRQA’s experience with MRV – Our credentials
Assessment, Validation, Verification and Training against:
– Cap-and-trade schemes and offset
mechanisms:
– UK ETS
– EU ETS (incl Aviation)
– California ARB
– Tokyo Metropolitan Government
ETS
– Japanese Voluntary ETS
– Korean GHG & Energy Target
Management System
– Clean Development Mechanism
– Gold Standard
– VCS
– Climate Action Reserve
– Inventories & product footprints:
– 14064
– GHG Protocol
– California Climate Action Registry
– The Climate Registry
– PAS 2050
– Japanese Carbon Footprint of
Products Scheme

4. LRQA’s experience with MRV – Our credentials
– Technical committees that improve and develop standards including ISO, IETA, WRI,
WBCSD and the ETG
– Provided the verifiers perspective for the EU ETS Commission Decision on Monitoring and
Reporting
– Part of the European Co-operation for Accreditation drafting accreditation requirements
for verifiers
– Represented UK on development of ISO 14064 standards for GHG validation, verification
and monitoring
– Member of Japan Operational Entities Association (JOEA)
– One of only five strategic verification partners of the CDP (formerly the Carbon Disclosure
Project)
– Vice President of the Association of DOE’s under the CDM – DIA
– On the Board of the International Emissions Trading Association (IETA)

5. Improving performance,
reducing risk
MRV in the EU ETS
The Role of the Verifier

6. What is MRV?
– MRV is the process by which the GHG data is
– Monitored,
– Reported and
– Verified.
– Data Monitoring includes: data acquisition, analysis, processing, recording
and calculation – completed by the operator
– Reporting involves the final facts and figures as reported to the regulator
by the operator
– Verification is the independent and accredited process of checking that
the data and information reported has been monitored and reported in
accordance with the requirements and is materially correct

7. Verification
– An independent and accredited methodology to address the
reliability, credibility and accuracy of monitoring systems and the
reported data and information relating to emissions
– To provide trust that the report is a faithful representation and is
reliable for all users
– An effective and reliable tool upon which an operator can work to
improve performance in M&R emissions

8. Independence
– Independent and impartial in carrying out the verification activities
– Verifiers can not also:
– Be operators
– Own operators
– Have any relations with operators that may affect their independence
and impartiality
– Trade allowances
– Conduct verification where this creates a conflict of interest, e.g.
where:
– Consultancy services or technical assistance for monitoring and
reporting have been provided

9. Requirements to Safeguard Independence
– Verifiers are required to
establish, document, implement
and maintain systems to ensure
continuous impartiality and
independence of:
– the verifier (the
organisation),
– other parts of the same legal
entity, and
– all personnel and contractors
involved in the verification
process.

10. Accreditation
– An attestation by a national accreditation body that a verifier meets the
requirements set to carry out the verification of an operator’s report in
accordance with the Regulation.
– Accredited by industrial sector
– Accredited against:
– EU Regulation 600/2012, on the verification and accreditation of
verifiers;
– ISO 14065; and
– The European Cooperation for Accreditation document - EA 6/03.

11. EA 6/03 – General Requirements
– Stipulates:
– Scope, role and depth of verification
– Organisational requirements (systems required) of the verification
body
– Stages of the verification process
– Reporting requirements
– Competence of verifiers, technical reviewers and management

12. EA 6/03 - Competence of Verifiers
– Technical Sector Competence
– Technical ability to manage the EU ETS verification work for the
accredited sectors.
– Including: unique industry process parameters, testing techniques,
measuring/monitoring arrangements, calculation methodologies
and relevant legislative requirements etc.
– Generic Competence
– EUETS Regulations for M&R, V&A
– National Legislation
– Data and Information Auditing
– Verification Process

13. Verification Body Systems
– To ensure our accreditations and
the quality assurance of our
services, we maintain:
– Our quality management
system (forms, procedures,
processes, records)
– Technical reviews
– Internal audits (offices)
– Witnessed visits (verifiers in
the field)
– Update briefings and
refresher training of staff
(verifiers, technical
reviewers, managers,
administrators)

14. Improving performance,
reducing risk
MRV in the EU ETS
The Role of the Operator

15. MRV - Operator requirements
– Apply for a permit & monitoring plan
– Monitor their emissions data in accordance with the Regulations and
their monitoring plan
– Submit a verified annual emission report to the Regulator by 31 March
each year
– Using the standard template
– Provide the verifier with access to all required information
– Retain their relevant records for a minimum of 10 years

16. EU ETS MRV Process

17. Importance of operations
Operations is the centre of
gravity for monitoring and
reporting
&
the platform for successful
verification

18. Operational Challenges
– Focussing on the data gathering
and compilation process, in
addition to the report
– Ensuring their management
systems are up-to-date to keep
up with changes to reporting
requirements & staff turnover
– Ensuring their management
systems cover their software and
understand the calculations and
formula contained within
– Ensuring records are retained to
facilitate verification

19. The Verifier : Operator Relationship
Myth
– The verifier works alone
– The verifier reports all issues
identified at the end of the
process
– Errors found will lead to a ‘not
verified’ opinion
Fact
– The verifier will work with the
operator to verify the data and
reports
– Issues identified are reported as
soon as they are identified
– The verifier will identify errors &
the operator must correct them
where possible

20. Improving performance,
reducing risk
MRV in the EU ETS
Lessons Learnt

21. Lessons Learnt
Overview Observations
– Emissions trading:
– Is an effective mechanism to reduce GHG emissions
– Enables industry and operators to decide on the most cost
effective means of emissions reduction for them
– Provides a financial incentive to do better
– Is dependent on accurate monitoring and reporting, and
data quality
– Credibility and confidence in the integrity and fairness of
the scheme is enhanced by the independent verification
process

22. Lessons Learnt
Scheme Design & Implementation
– Started off small and grew to incorporate more sectors and gases,
based on experience
– Importance of accurately setting an overall emissions cap and
allocating emission allowances
– Importance of effective approval of permits and monitoring plans
– The benefits of electronic, standard application, permitting and
reporting systems
– Importance of effective, competent and independent verification
and accreditation

23. Lessons Learnt
Consultation & Communication
– Strong coordination/communications
between Government, Regulators,
Verifiers, Accreditors and Industry:
– Emissions Trading Group
– European Co-operation for
Accreditation
– Public consultations on guidance
documents
– Workshops to introduce new
requirements/documents
– Regulator road-shows
– Helpdesks / websites for queries and
guidance.

24. Lessons Learnt
Good Guidance Documents
– Good guidance enables good
MRV and resulting data that can
be trusted
– Guidance is needed to address
the following areas:
– Sectoral scope for inclusion
– Monitoring requirements
– Reporting requirements
– Verification requirements
– Accreditation requirements
for verifiers

25. Lessons Learnt
Operator Preparation
– Smooth MRV processes require:
– Preparedness
– Familiarisation and understanding of the requirements and
guidance documents
– The identification of responsible people/teams
– Attendance at training events, workshops, road shows
– Liaison with others in the industry, to share experiences and
knowledge
– Establishment of MRV as part of your business management
systems
– Engagement with a verifier early – in order to identify and remedy
any gaps/issues prior to deadlines
– Consideration of split verification over the year (quarterly or 6
monthly)

26. Lessons Learnt
Typical Issues Identified at Verification
– Missing sources & fuels (e.g.
back-up power generation,
back-up fuels)
– Inconsistent/incorrect calculation
methods
– Greater metering uncertainty
than required
– Calculation mistakes (e.g.
conversion errors, incorrect
emission factors)
– Typing errors (e.g. during
manual transposition)

27. Improving performance,
reducing risk
Refreshments and Q&A

28. Lloyd’s Register and variants of it are trading names of Lloyd’s Register Group Limited, its subsidiaries and affiliates.
Copyright © Lloyd’s Register Quality Assurance Limited 2013. A member of the Lloyd’s Register group.
Improving performance,
reducing risk
Madlen King
Global Head of Climate Change & Sustainability
E madlen.king@lrqa.com
@madlenking