THE EMISSIONS TRADING SCHEME: CHALLENGES AND FUTURE IMPACTS FOR GEOTHERMAL POWER PLANTS

Abstract

The Emissions Trading Scheme (ETS) in New Zealand came into effect in 2008, and was subsequently extended to include geothermal power plants in 2010. For geothermal plants the gases applicable to the ETS are carbon dioxide and methane. Carbon dioxide and methane emissions vary considerably between different geothermal fields, with factors such as reservoir characteristics and plant operation affecting the true level of carbon emissions made by a plant. For several Mighty River Power operated plants, the Default Emission Factors (DEFs) originally published in legislations are considerably higher than the actual rates of emission by a plant.
This has led to Mighty River Power applying for lower Unique Emission Factors (UEFs) for plants where there is significant difference between DEF and UEF to manage the carbon emission fees payable to the ETS.
Mighty River Power has successfully complied with ETS legislative requirements since 2010 and currently holds UEFs for three of the five plants it operates.
The purpose of this paper is to examine the process of measuring and reporting carbon emissions in a geothermal power plant, the advantages and disadvantages of DEFs versus UEFs, and how recent changes to the ETS requirements impact the obligations geothermal power plants have under the legislation.