Appendix E Calculation Methods Appendix

Appendix E
Calculation Methods Appendix $-$ Part II.C.3.c and II.C.3.d

II.C.3.c Scope 2 Emissions for Facilities with Direct-Line Connections

A small number of facilities reported purchasing electricity through a direct-line connection. As discussed in chapter 3 (“Scope 2 Emissions”), this is a rare sourcing arrangement where electricity can flow directly from the electricity generation unit to the facility without first flowing through the transmission and distribution grid.537F[534] Electricity sourced through a direct-line connection is the only time that the primary scope 2 calculations do not use eGRID subregional emissions factors for purchased electricity. These two pieces of the scope 2 electricity emissions calculations are shown in figure E.2 and described in more detail below.

Figure E.2 Mapping of scope 2 electricity emissions to subprocess-specific estimates

Figure E.2 is a process map that shows the two steps to calculating scope 2 electricity emissions. First, data on electricity purchased through direct line connections are multiplied by emissions factors specific to the plant they were purchased from. Second, all other electricity purchases are multiplied by a subregional emissions factor. Combined, these two pieces result in the total scope 2 electricity emissions. Data from question 3.9 are then applied to the total to break out the facility’s subprocess-specific estimates for scope 2 electricity emissions.

Source: Compiled by the USITC.

Note: The “Q” labels in the diagram above indicate the question number in the Commission’s facility-level questionnaire gathering this information. USITC, Greenhouse Gas (GHG) Emissions Intensities Questionnaire: Facility-Level, 2024, sections 3-4.

The questionnaire requested data on direct-line connections across two questions. Question 4.4b covered the quantity of energy attribute certificates (e.g., renewable energy certificates) associated with a zero-emission source of energy that were bundled with electricity supplied via a direct-line connection ( $c e r t i f i c a t e s_{d l c}$ ).538F[535] Question 4.5 covered plant-specific contractual arrangements with plants that did not receive energy attribute certificates and included data on the quantity of electricity that was supplied via a direct-line connection ( $n o n c e r t p l a n t_{d l c}$ ). Using the non-certificate electricity data from question 4.5 and an emissions factor specific to the plant in eGRID ( $e G R I D_{p l a n t}$ ), equation E.31 estimates emissions associated with purchases made through direct-line connections ( $S 2_{e l e c d l c}$ ).539F[536]

$\begin{matrix} S 2_{e l e c d l c} = n o n c e r t p l a n t_{d l c} * e G R I D_{p l a n t} (E .31) \end{matrix}$

To separate direct-line connection purchases from all other electricity purchases ( $p u r c h_{e l e c n o n d l c}$ ), equation E.32 removes electricity purchases $c e r t i f i c a t e s_{d l c}$ and $n o n c e r t p l a n t_{d l c}$ from total electricity purchases reported in question 4.1.540F[537]

$\begin{matrix} \begin{matrix} p u r c h_{e l e c n o n d l c} = p u r c h_{e l e c} - c e r t i f i c a t e s_{d l c} - n o n c e r t p l a n t_{d l c} (E .32) \end{matrix} \end{matrix}$

Equation E.33 accounts for emissions from all other electricity purchases (applying the same subregional emissions factor covered in the simple version of the calculations).541F[538] Finally, equation E.34 combines the direct-line connection emissions with non-direct line (grid) purchase emissions and allocates them to associated subprocesses using electricity use quantities provided in question 3.9.

$\begin{matrix} S 2_{e l e c n o n d l c} = p u r c h_{e l e c n o n d l c} * e G R I D_{s r l} (E .33) \end{matrix}$

$\begin{matrix} S 2_{e l e c, s u b p r o c} = (S 2_{e l e c d l c} + S 2_{e l e c n o n d l c}) * \frac{u s e_{e l e c, s u b p r o c}}{Σ_{s u b p r o c} (u s e_{e l e c, s u b p r o c})} (E .34) \end{matrix}$

II.C.3.d Scope 2 Emissions for Facilities with Purchases of Useful Thermal Outputs

For this investigation’s survey population, purchases of steam, heat, or hot water (useful thermal outputs or UTO) from a third party were rare but sometimes associated with significant quantities of emissions.542F[539] The Commission collected data on these purchases of useful thermal outputs in question 4.7 and used eGRID data on cogeneration plants to determine how much of the supplying cogeneration plant’s emissions to assign to the purchased useful thermal output. The key aspects of this calculation are shown in figure E.3, below. When useful thermal output was purchased from a boiler or a source that was otherwise unavailable in eGRID, facility contacts were requested to provide the emissions factor that their company used for the purchased useful thermal output in company-level emissions accounting.543F[540]

Figure E.3 Mapping of scope 2 useful thermal output emissions from cogeneration plants to subprocess-specific estimates

Figure E.3 is a process map that shows how the emissions for each type of useful thermal output that was purchased was calculated. The numerator of the calculation uses questionnaire data on how much of the output was purchased from a specific plant. This is divided by the total amount of total useful thermal outputs the plant generated, the plant’s emissions, and the complement of the plant’s electric allocation factor (these three data points are from eGRID). This results in scope 2, useful thermal output-specific emissions that are then combined with questionnaire data to break out subprocess-specific estimates.

Source: Compiled by the USITC.

The questionnaire allowed respondents to report purchases of useful thermal outputs in three different units: megawatt-hours (MWh) used to generate the output, in gigajoules of output, or in MMBtu of output. When these thermal outputs were purchased from a cogeneration plant in the eGRID database, the calculations converted the purchased quantities to MMBtu.544F[541] Equation E.35 uses the ratio of the purchased MMBtu of useful thermal output reported in question 4.7 ( $p u r c h_{p l a n t, u t o}$ ) to total useful thermal output from the plant in eGRID ( $g e n_{p l a n t, u t o}$ ) to estimate the share of the plant’s useful thermal outputs purchased by the facility ( $p u r c h s h a r e_{p l a n t, u t o}$ ).545F[542] Equation E.36 separately estimates the scope 2 emissions associated with the facility’s purchased steam, heat, and hot water $(S 2_{u t o})$ . To do this, the equation multiplies the share of useful thermal output purchased from the plant by the ratio of non-electric outputs to electric outputs(measured by dividing the complement of the plant’s electric allocation factor by the electric allocation factor) and by the plant’s total CO₂e emissions allocated to electricity generation in eGRID ( $p l a n t G H G$ ).546F[543] These calculations were run separately for each pairing of useful thermal output and source plant reported in question 4.7 and then totaled for each useful thermal output.

$\begin{matrix} p u r c h s h a r e_{p l a n t, u t o} = \frac{p u r c h_{p l a n t, u t o}}{g e n_{p l a n t, u t o}} (E .35) \end{matrix}$

$\begin{matrix} S 2_{u t o} = \sum_{p l a n t} [(1 - e l e c f a c t o r_{p l a n t}) * p u r c h s h a r e_{p l a n t, u t o} * p l a n t G H G] (E .36) \end{matrix}$

Next, equations E.37.a and E.37.b determined what share of each thermal output was used on-site rather than sold. As denoted in equation E.37.a, if the facility sold more of a useful thermal output than it purchased, the scope 2 share was set to zero, and the scope 1 emissions associated with generating the useful thermal output were reduced by the share of net sales. Most facilities did not both purchase and sell useful thermal output, so the scope 2 share ( $n e t p u r c h s h a r e_{u t o}$ ) often has a value of 1.

$\begin{matrix} I f s o l d_{u t o} > p u r c h_{u t o} : n e t p u r c h s h a r e_{u t o} = 0 (E .37. a) \end{matrix}$

$\begin{matrix} E l s e : n e t p u r c h s h a r e_{u t o} = \frac{p u r c h_{u t o} - s o l d_{u t o}}{p u r c h_{u t o}} (E .37. b) \end{matrix}$

Equations E.38-E.40 applied this share and the thermal output-specific scope 2 emissions to subprocesses using the percent shares reported in questions 3.10, 3.11, and 3.12, respectively. Finally, equation E.41 combined these scope 2 emissions with the scope 2 emissions from purchased electricity to estimate scope 2 emissions for each subprocess $(S 2_{s u b p r o c}$ ).

$\begin{matrix} S 2_{s t e a m, s u b p r o c} = S 2_{s t e a m} * u s e s h a r e_{s t e a m, s u b p r o c} * n e t p u r c h s h a r e_{s t e a m} (E .38) \end{matrix}$

$\begin{matrix} S 2_{h e a t, s u b p r o c} = S 2_{h e a t} * u s e s h a r e_{h e a t, s u b p r o c} * n e t p u r c h s h a r e_{h e a t} (E .39) \end{matrix}$

$\begin{matrix} S 2_{h w a t e r, s u b p r o c} = S 2_{h w a t e r} * u s e s h a r e_{h w a t e r, s u b p r o c} * n e t p u r c h s h a r e_{h w a t e r} (E .40) \end{matrix}$

$\begin{matrix} S 2_{s u b p r o c} = S 2_{e l e c, s u b p r o c} + S 2_{s t e a m, s u b p r o c} + S 2_{h e a t, s u b p r o c} + S 2_{h w a t e r, s u b p r o c} (E .41) \end{matrix}$

From this point in the calculations, the allocation of any emissions from ambient heating and the aggregation of subprocesses to unit process emissions for scope 2 energy follow the same steps as with simpler facilities (equations E.11 $-$ E.13). These final steps yield scope 2 energy unit process emissions ( $S 2 U G H G_{p r o d u c t})$ for the product-level emissions inventories.

[534] One example of this is facilities that have an on-site power or cogeneration unit that is operated by a third party. WRI, GHG Protocol Scope 2 Guidance, 2015, 36.

[535] Question 4.4f covered the possibility of a facility purchasing additional electricity through a direct-line connection to a plant that issued certificates (more than the quantity of certificates reported in question 4.4b), but no facilities reported this. USITC, Greenhouse Gas (GHG) Emissions Intensities Questionnaire: Facility-Level, 2024, responses to questions 4.4f and 4.4b.

[536] The supplying plant’s DOE identification number, as reported in the questionnaire, is used to retrieve the plant-specific emissions factor in eGRID. For the eGRID data, this step used variables ORISPL and PLC2ERTA. EPA, “PLNT22,” January 30, 2024.

[537] No further calculations for the direct-line connection purchases were bundled with zero-emission certificates, because their direct-line emissions factor is zero.

[538] See “Calculating Facility-Wide Scope 2 Emissions”.

[539] USITC, Greenhouse Gas (GHG) Emissions Intensities Questionnaire: Facility-Level, 2024, responses to question 4.7; USITC estimates based on its calculation methodology.

[540] A boiler can only produce a type of useful thermal output, and therefore, no electricity is produced from these units, and the use of an electrical allocation factor is not necessary to determine the amount of emissions allocated to the use of the resulting useful thermal output. For more information on the cogeneration plant data in eGRID, see EPA, OAR, eGRID2022 Technical Guide, January 2024, 15.

[541] The Commission used an assumed 75 percent efficiency for generating useful thermal output and a 3.412 conversion rate for MWh to MMBtu, or a 0.947817 conversion rate for gigajoules to MMBtu.

[542] The calculations use variable USETHERMO, described as “CHP plant useful thermal output (MMBtu),” for the plant’s total useful thermal output. EPA, “PLNT22,” January 30, 2024; EPA, OAR, eGRID2022 Technical Guide, January 2024, 47.

[543] eGRID adjusts variables such as $p l a n t G H G$ (PLCO2EQA in the eGRID database) by the electric allocation factor, to solely measure the emissions associated with the plant’s electricity generation. Dividing $p l a n t G H G$ by $e l e c f a c t o r_{p l a n t}$ removes this adjustment; multiplying by $1 - e l e c f a c t o r_{p l a n t}$ then reduces the plant emissions to the quantity associated with non-electric outputs, i.e., useful thermal outputs. Variables ELCALLOC and PLCO2EQA. EPA, “PLNT22,” January 30, 2024; EPA, OAR, eGRID2022 Technical Guide, January 2024, 47, 49.