January 9, 2004 FE# 6298

Electronic submission to: 1605bgeneralguidelines.comments@hq.doe.gov

Re: GM's Response to the Department of Energy (DOE) Federal Register
Notice (68203), 10 CFR Part 300, General Guidelines for Voluntary
Greenhouse Gas Reporting; Proposed Rule.

GM is pleased to offer the following comments regarding the proposed
revisions to the General Guidelines for governing voluntary reporting of
greenhouse gases (GHG) under the Energy Policy Act of 1992. However, GM
plans to submit additional comments after the January 12^th^, 2004
workshop and after the Technical Guidelines have been released.

GM has reported its GHG emissions and reductions across its U.S.
Operations (96 facilities) to the DOE 1605(b) since the program's
inception in 1995 and plans to continue reporting in the future under
the updated Reporting Guidelines.

GM believes that the DOE 1605(b) GHG Guidelines are an important
strategic tool to accomplish a number of key public policy objectives
and it is critical that changes enhance the ability to achieve these
objectives. From GM\'s perspective, these objectives are:

1\) Encourage the broadest range of entity participation, including
companies (large, medium and small), entities in the broader public
sector, not for profit organizations and individuals;

2\) Focus entities on how to measure and take concrete steps to reduce
GHG emissions within each entity\'s direct ambit of command and control
in the most cost-effective manner;

3\) Aggregate, with the greatest degree of accuracy possible, the
combined reductions in GHG emissions achieved by reporting entities
within the U.S.;

4\) Demonstrate that voluntary measures are highly effective in
achieving GHG reductions;

5\) Ensure the continued competitiveness of America and stimulate
innovation;

6\) Inventory initiatives by American entities to reduce GHG emissions
beyond America\'s borders and ensure proper recognition for these
reductions;

7\) Continue to build a common sense framework for GHG emissions
reductions reporting which enables market-based mechanisms such as
emissions trading without creating undue cost or bureaucratic burdens;
and

8\) Establish a first priority for resource allocation in the area of
*achieving GHG emission reductions*

GM would like to acknowledge the extensive process (i.e. public
workshops across the US and many meetings with various stakeholders)
undertaken by the DOE to enhance and update the existing 1605(b)
Guidelines for GHG Reporting. The basics of the two-tiered approach that
has been developed under the updated Guidelines for reporting and
registering GHG emissions, reductions and offsets is very appropriate
for allowing the right level of flexibility for those entities just
starting the reporting process and for those entities ready to pursue
eligibility for registration in the 1605(b) GHG Registry.

GM believes that the fundamental premise for reporting should be that
entities have responsibility for reporting that which is under the
entity's direct ownership and/or management/operational control. Certain
companies may choose to report on issues beyond this scope, for example
to share best practices or other voluntary initiatives, but there should
be no obligation in this regard. Simply put, "Whoever buys the energy,
owns the ensuing GHG emissions and reductions."

Specific to the proposed updates in the Guidelines, GM has identified
six issues that are very important to establish a strong program for GHG
reporting for America and to ensure that current participation is
maintained and more entities are encouraged to begin participating in
order to grow total engagement in reporting to the 1605(b). Additional
details per the six issues can be found in Section I.

1\. Credit for Early Action: GM submits that if a company was proactive
in taking voluntary actions to reduce and sequester GHG emissions and
reporting emissions, removals, and reductions to the 1605(b) from a
base-year of 1990, and it recasts its earlier reports into the updated
1605(b) Guidelines, then it should not be penalized by having its
reported and verifiable CO2 reductions ineligible for
[registration]{.underline} into the 1605(b) Registry. The 1605(b) should
provide a GHG Registry open and available for all who want to both
register and 'bank' their CO2 reduction credits, as long as the
reductions are real and verifiable under the updated 1605(b) Guidelines.

2\. Absolute Emissions vs. Intensity Indicators: GM would like to
qualify the use of Absolute Emissions vs. Intensity Indicators in both
representing the actual performance of an entity in achieving GHG
reductions, and in its use across sectors. The DOE needs to collect the
[absolute]{.underline} measure of GHG emissions, reductions and offsets
across the nation in order to measure its progress toward the
Administration's 18%/GDP reduction target. Intensity metrics can be
helpful in understanding trends, and should continue to be a tool, which
reporters can choose to use as an optional part of reporting.

However, it is important that a clear picture be available of total
reductions (or increases) in absolute GHG emissions from each entity.
Accordingly, GM believes that the use of Intensity Indicators should
only be submitted by the entity if the entity ALSO submits absolute
totals.

3\. Large Emitter Status: The concept of ownership and/or
management/operational control provides a reasonable approach to
establishing corporate boundaries that are appropriate for reporting GHG
emissions, reductions and offsets. Therefore, an entity should be
allowed, but NOT REQUIRED, to report on any and all aspects of their
owned and/or management/operationally controlled Corporate Boundary
[regardless of emitter status]{.underline}.

GM also believes that the DOE should NOT develop a "more prescriptive"
approach to the definition of entities, such that they correspond to
those used for "Federal Tax Purposes," as a requirement for
participation in reporting to the 1605(b).

4\. CEO Certification: GM believes that entities should be allowed to
submit annual GHG emission and reduction reports to the DOE 1605(b) with
sign-off certification by a registered Professional Engineer (P.E.), a
Ph.D. Engineer, or an officer of the company. CEO certification should
not be required or recommended.

5\. Issues of 3^rd^ party Verification Requirements for Reporting vs.
Registration: For Reporting and Registration, GM believes that 3^rd^
party certification/verification should not be required at the time of
reporting or registration. 3^rd^ party certification/verification should
occur at the discretion of the entity, [as it may be necessary to
facilitate a trade.]{.underline}

6\. Single U.S. Registry: GM believes that the DOE 1605(b) should be the
single, national GHG REGISTRY used to show progress across all voluntary
energy and GHG reduction programs (including those programs operated by
states and NGOs) within the U.S., and should allow for the reporting and
registration of non-U.S. GHG emissions and reductions.

The following pages cite specific responses to each of the DOE's request
per section within the proposed revised General Guidelines for reporting
to the DOE 1605(b).

GM plans to participate in the DOE's public workshop in Washington, DC
on January 12, 2004 to discuss the proposed revisions.

![](media/image1.png)Respectfully Submitted,

Kristin B. Zimmerman, Ph.D.

General Motors Public Policy Center

Environment & Energy Strategy

313-665-9164

[kristin.b.zimmerman@gm.com](../kristin.b.zimmerman@gm.com)

cc: E.A. Lowery

T.A. Wakefield

[Margot.Anderson@hq.doe.gov](../Margot.Anderson@hq.doe.gov)
[larisa.dobriansky@hq.doe.gov](mailto:Lerisa.dobrianski@hq.doe.gov)

<Arthur.Rypinski@hq.doe.gov> [Al.cobb@hq.doe.gov](../Al.cobb@hq.doe.gov)

Greenhouse Gas Reporting Under the Department of Energy 1605(b)

[Section 1: Position Statements]{.underline}

-   GM believes that the Department of Energy (DOE) via the voluntary
    1605(b) should own the national GHG Reporting Program and Registry.
    Annual totals reported within the 1605(b) will provide a mechanism
    to show measurable progress toward the Administration's 18%
    intensity goal.

-   GM supports credit for early action and submits that if a company
    was proactive in taking voluntary actions to reduce and sequester
    GHG emissions and in reporting emissions, removals, and reductions
    to the 1605(b) from a base-year of 1990, then it should not be
    penalized by having its reported and verifiable CO2 reductions
    ineligible for 'credit' and trading in a future emissions trading
    scheme. The companies that have reported as a charter member of the
    1605(b) should be allowed at any time to submit all data in their
    1605(b) filings to a 3^rd^ party for verification to ensure
    eligibility for trading.

-   Many industries are cyclical, with significant fluctuations in
    demand and therefore, output over time. If a company is successful,
    demand for its products may grow over time. Companies with less
    energy-intensive processes can have their GHG emissions in any given
    year impacted by external factors such as weather (the requirement
    for greater heating and/or cooling of facilities/machinery).
    Companies may decide to consolidate operations to reduce cost,
    including energy per unit produced. Companies may decide or be
    required to install abatement equipment to reduce some emissions
    with this equipment requiring greater energy consumption. In
    industries with relatively long capital investment cycles, some
    companies may be ahead of others in installing new, more efficient
    processes - or have made the decision earlier than their competitors
    to focus on achieving GHG reductions (which is why credit for early
    action is so critical). Many companies do not have control over the
    energy sources for power generation - they are net takers of
    indirect emission factors, which may vary considerably regionally
    and internationally. All of these factors, along with many others
    can impact emissions per unit produced.

It is important that reporting parameters provide a fair picture of the
conditions and management actions shaping an entity\'s GHG emissions. It
is also critical that GHG reporting requirements do not cap or
discourage an entity\'s ability to grow, invest and provide jobs in
America. Accordingly, we believe that in many cases, companies will want
to provide both measures of energy intensity as well as absolute
emissions in their reports.

> However, it is important that a clear picture be available of total
> absolute reductions (or increases) in GHG emissions for each reporting
> entity. Accordingly, GM believes that the use of intensity indicators
> should only be submitted by the entity if the entity also submits
> absolute totals.

-   The definition of \'Large Emitters\' requires further thought.
    Ownership and/or management/operational control should be the
    general principle for determining the scope of activities that
    should be reported. Simply put, the guiding principle should be
    \"Whoever pays for the energy, prima facie owns the emissions - and
    any reductions or offsets\".

Other countries (such as Canada) have established criteria for \'Large
Emitters\'. We encourage the U.S. to work with its major trading
partners to establish common definitions wherever possible, so that we
do not inadvertently (e.g. by our reporting definitions) create
advantages for certain businesses in one jurisdiction over another.

> Another measure for consideration is the energy intensity of a
> particular industry per dollar value of output. The auto industry
> produces very high levels of economic value per unit of energy used.
> For example, Industry Canada estimates that the auto industry emits 14
> kilograms of CO2 per \$1000 of economic output, as opposed to the oil
> / resource sector in Canada which emits 3700 kilograms of CO2 per
> \$1000 (oil sands) of economic output or 264 times more per dollar of
> output or coal generated electricity at 15,400kg per \$1000 (\>1200x).
> Plastics at 70 kg of CO2 per \$1000 GDP output or brewers at 640
> kilograms of CO2 per \$1000 were not sectors classified as large
> emitters for the Canadian program. Similarly, the auto industry has
> been excluded. In addition, some industries are primary determiners of
> GHG emissions, in terms of establishing the mix of fuels.
> Manufacturing generally is a \'taker\' of indirect GHG emissions and
> has extremely limited opportunities to influence this mix (although
> credit should be available for green power, as noted elsewhere).
> Obviously, the more energy intensive an industry is, and the greater
> degree of influence on the level of GHG emissions per unit of power,
> the higher the reporting obligations should be.
>
> Finally, it is important not to penalize companies with many sites
> (and larger employee bases) versus companies with only single sites.
> Accordingly, the definition of large emitter should be on a per-site
> basis, not on aggregate emissions for that company in the U.S.

-   GM also supports the eligibility of offsets within the 1605(b) as a
    mechanism for representing an entity's GHG footprint rather than
    simply its direct and indirect GHG emissions and reductions within
    its "owned" boundaries. The inclusion of offsets can be a key
    component of the GHG management lifecycle and offers a means to
    convey the proactive management actions taken by an entity to avoid
    emissions. Refer to Part 1: Item 6 for a detailed example.

-   GM believes that the 1605(b) reporting and registering must remain
    flexible and enable, not require, those entities that report and
    register their emissions, reductions, and offsets for U.S.
    Operations to [also]{.underline} submit non-U.S. emissions,
    reductions, and offsets. Entities should also be allowed to submit
    reports per business unit and/or operating structure but should
    designate which countries the business unit/operating structure
    operates in.

-   GM supports full disclosure, as practicably possible, in the
    reporting of GHG emissions that are under an entity's
    management/operational control. If this includes international
    activities, then the reporting entity should be allowed to report on
    these activities as an option. The DOE may want to pursue
    interoperability with other national reporting programs in order to
    allow entities that are based in other countries to file their
    reports to the 1605(b), as well as to other national registries in a
    consistent manner.

-   GM does not support the requirement that emissions reductions should
    be certified in order to be registered. The validation of a
    company\'s report by a Professional Engineer or PhD. Engineer should
    be sufficient for registration purposes - for many other business
    purposes, i.e. mandated air permit requirements, this suffices. The
    process of third party certification can be expensive and require
    considerable internal resources. As the market for GHG trades is yet
    very thin, a requirement of third party certification simply for
    registration would put an undue burden on those companies that are
    making reductions without any reasonable prospect for a return on
    these expenditures in most circumstances. In certain circumstances,
    it may be possible for entities to make trades without third party
    certification (for example, under private contract law subject to
    whatever due diligence the parties deem appropriate). In the absence
    of mandated GHG reductions and/or any legal obligations (beyond
    common law) governing GHG trades, companies should not be expected
    to have third party certification. Such a requirement would only
    discourage participation - and at this time, the focus should be on
    maximizing participation. Third party certification should only be
    expected where it is necessary to facilitate a trade.

> Note: Federal law prohibits any person or entity from knowingly and
> willfully making any false or fraudulent statement of any material
> fact to any department or agency of the U.S. Government (18 U.S.C.
> 1001). This prohibition, with its substantial penalties, should deter
> anyone from making false or fraudulent submissions to 1605b.

-   GM does not support a requirement for certification that the direct
    or indirect GHG emissions in its entity report are not included in
    the 1605(b) report of another entity in the same calendar year. This
    requirement would add another layer of burden and complexity to the
    1605(b), hence removing the flexibility from the reporting entity
    that would like to continue to support the 1605(b) as a voluntary,
    non-prescriptive, national GHG reporting program. Therefore, the
    Energy Information Administration (EIA) may need to add a step
    within their eligibility protocol for identifying and avoiding this
    potential double counting. The use of a serial numbering scheme for
    tracking the upstream elements of an entity's report may be helpful.
    The workshop may want to set aside time to help define this
    particular issue.

GM would also like to state the following observations:

The following organizations provide Guidelines for GHG
[Reporting]{.underline}: DOE 1605(b), the EPA, the WRI, ISO-14064 (by
2005).

The DOE 1605(b) is the only National Registry available in the U.S. for
entities to report their GHG emissions, reductions and offsets.

Reporting entities should be allowed to transfer/exchange credits from
any GHG registry based on their own negotiations with other interested
parties without the requirement for government intervention or the use
of an Exchange.

In summary -- GM believes that the DOE 1605(b) should be the single,
national GHG REGISTRY used to show progress across all voluntary energy
and GHG reduction programs (including those programs operated by states
and NGOs) within the U.S., at a minimum, and should allow for the
reporting and registration of non-U.S. GHG emissions and reductions.

The DOE holds a leadership position on issues of energy. Therefore,
ownership of a single GHG Registry by the DOE will: (1) reduce the
effects of proliferation of various other GHG reporting Guidelines and
Standards, and (2) ensure a democratic process across all interested
stakeholders in the development of GHG Reporting Guidelines and
Standards.

Section 2: GM Position Statements Specific to the DOE's Request for
Comment within the Proposed Revised Guidelines

Comments Specific to Figure 1: Elements and Approach of the Proposed
Revised Guidelines

1.  [Publicly Reported Reductions and Removals]{.underline}: If there is
    no intention by the reporting company to use their reported
    reductions and removals for crediting under a transferable credit
    scheme, then the General Guidelines for "All Reports" should allow
    for the reporting of projects only, as well as entity reporting with
    projects optional. The reported reductions and removals should still
    go to the EIA for review.

**GM's Position on Project Level vs. Entity Reporting:**

-   GM supports the reporting of projects (both inside and outside of
    organizational and geographic boundaries) as a valuable category to
    represent action taken by industry to manage GHG reductions, as well
    as to generate public awareness of 'best practices,' which could be
    adapted by other entities.

-   GM supports GHG reporting of projects alone, projects plus entity,
    or entity alone. However, companies that report projects without
    entity reporting are unable to develop an entity 'baseline.'

-   GM supports reporting of emission reductions and carbon
    sequestration from projects and suggests that the guidelines
    comprehend all national and, at the company's discretion,
    international projects achieving emission reductions and carbon
    sequestration. This will allow flexibility in reporting and
    emissions trading for both national and multi-national corporations.

2.  The qualifying date for registering reductions of "after December
    2002" does not appear to give credit for early action. GM supports
    credit for early action as stated previously.

The definition of \'Large Emitters\' requires further thought. Ownership
and/or management/operational control should be the general principle
for determining the scope of activities that should be reported. Simply
put, the guiding principle should be \"Whoever pays for the energy,
prima facie owns the emissions - and any reductions or offsets\".

Other countries (such as Canada) have established criteria for \'Large
Emitters\'. We encourage the U.S. to work with its major trading
partners to establish common definitions wherever possible, so that we
do not inadvertently (by our reporting definitions) create advantages
for certain businesses in one jurisdiction over another.

Another measure for consideration is the energy intensity of a
particular industry per dollar value of output. The auto industry
produces very high levels of economic value per unit of energy used. For
example, Industry Canada estimates that the auto industry emits 14
kilograms of CO2 per \$1000 of economic output, as opposed to the oil /
resource sector in Canada which emits 3700 kilograms of CO2 per \$1000
(oil sands) of economic output or 264 times more per dollar of output or
coal generated electricity at 15,400kg per \$1000 (\>1200x). Plastics at
70 kg of CO2 per \$1000 GDP output or brewers at 640 kilograms of CO2
per \$1000 were not sectors classified as large emitters for the
Canadian program. In addition, some industries are primary determiners
of GHG emissions, in terms of establishing the mix of fuels.
Manufacturing generally is a \'taker\' of indirect GHG emissions and has
extremely limited opportunities to influence this mix (although credit
should be available for green power, as noted elsewhere). Obviously, the
more energy intensive an industry is, and the greater degree of
influence on the level of GHG emissions per unit of power, the higher
the reporting obligations should be.

Finally, it is important not to penalize companies with many sites (and
larger employee bases) versus companies with only single sites.
Accordingly, the definition of large emitter should be on a per-site
basis, not on aggregate emissions for that company in the U.S.

3.  GM also believes that the DOE should NOT develop a more prescriptive
    approach to the definition of entities, such as the requirements
    that entity definitions correspond to those used for Federal Tax
    Purposes, as a requirement for participation in reporting to the
    1605(b).

4.  GM does not support the separate reporting of GHG emissions to
    cities, states, etc., for the reasons stated below.

GM's Position on National vs. State Level Reporting:

-   GM supports voluntary reporting of greenhouse gas emissions (GHGs)
    according to the DOE 1605(b) GHG Reporting Guidelines and Registry
    as a single coordinated National Reporting System rather than
    individual state reporting guidelines and registry systems to avoid
    the following:

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-   Multiple state-level reports

-   Potential proliferation of non-uniform reporting approaches

-   Potential for double counting

-   Revealing competitive information, especially in those states where
    the reporting company has only one facility (see Data
    Confidentiality Section)

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-   GM [opposes mandatory]{.underline} reporting as being unnecessarily
    burdensome at the State or Federal level. (GM would be
    [required]{.underline} to annually submit [30]{.underline}
    state-level reports.)

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-   GM believes that [States]{.underline} should encourage industry to
    participate in voluntary programs sponsored by the DOE, EPA and
    others, which share \'best practices\' that translate into energy
    and CO2 reductions backed by a strong business case. States should
    also support joint research programs between industry and the
    federal government on technologies to reduce GHG emissions.

-   GM has proven, by example, that the voluntary reporting mechanism
    provided under the [Federa]{.underline}l DOE 1605(b) enables the
    monitoring and reporting of 'real' reductions over time.

Part 1: (refer to sections 300.1- 10 of the rulemaking)

Sections B and C-Defining Reporting Entities and Entity Boundaries
(specific to sections 300.3-5)

GM's Position Statement: (supporting section 300.4)

-   GM believes that 100% of GHG Emissions should be reported for those
    facilities owned and/or under management/operational control rather
    than reporting a portion of emissions based on equity share.
    *Management/Operational Control means at least a 50% equity
    position, at least 50% Representation on the Board and/or management
    of the operation:*

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-   Full Ownership Implies Management/Operational Control: Report all
    Emissions

-   Joint Ownership: Report if under Management/Operational Control.
    Partners should determine, up-front, who will be reporting to avoid
    double counting.

-   Leased Facility: Report if under Management/Operational Control.

Direct vs. Indirect and "Other" Emissions: \[adding definition to
section 300.5(6), 300.6(b-c)\]

GM does not support a requirement for certification that the direct or
indirect GHG emissions in its entity report are not included in the
1605(b) report of another entity in the same calendar year. Purchased
electricity, by its nature, will be reported by the generator and the
user. The EIA may need to add a step within their eligibility protocol
for identifying potential double counting. The use of a serial numbering
scheme for tracking the upstream elements of an entity's report may be
helpful.

GM supports reporting Direct and Indirect Emissions from facility
operations in the following categories:

-   Direct Emissions include the combustion of fossil fuels to include:
    coal, coke, natural gas, LPG, distillate oil, solid waste, liquid
    waste

-   Indirect Emissions: Purchased Electricity, Steam and (chilled/hot)
    Water

-   Renewable Energy Sources: including landfill gas (use an emissions
    factor of zero to reflect the [effect of offsetting emissions from
    conventional energy sources)]{.underline}

-   

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-   GM suggests that indirect emissions should be explicitly defined as
    "emissions from purchased electricity." The term "Other" emissions
    should be used for those emissions other than Direct Fuels and
    Indirect Electricity.

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-   GM supports the reporting of aggregate Indirect Emissions from
    facilities in multiple states and suggests the following: Develop a
    base year weighted emissions factor based on a weighted average of
    state electricity usage and state electricity emissions factors for
    a designated base year. The base year weighted average emissions
    factor for electricity can be held constant in all of the reporting
    years to eliminate a year-to-year variable outside of the control of
    the reporting entity unless a 'recordable' shift in electricity mix
    has occurred by the reporting entity.

-   GM does not support the reporting or the registration of the
    following "Other" emissions (1) Employee Business Travel, (2)
    Transportation of Materials, Products, and Employees, (3) Employee
    Commuting. Identification and calculation of GHG emissions in
    categories 1 and 2 can be "highly inaccurate." Reporting of
    categories 1-2 could proliferate systematic inaccuracies in
    determining a CO2e total per each respective category. GM does not
    support the use of inaccurate or misleading data in establishing its
    baseline or in its annual reporting. Category 3 is a choice of the
    employee. Therefore, any reporting of GHG emissions from category 3
    is the responsibility of the employee. (See Attachment A) (Refer to
    section 300.6(c)-2)

*Example:* Employee Commute and Employee Business Travel.

GM does not support the use of Vehicle Miles Traveled (VMT) as an
accurate and/or representative emissions indicator for travel purposes
due to the following:

> VMT misrepresents the calculation of total GHG emissions: For
> Example...
>
> A duty cycle of 10 miles may take 10 minutes on an expressway going 65
> mph without traffic. It may also take 1 hour to travel 10 miles. The
> GHG emissions from each of the two scenarios are completely different.

Rather than using VMT, GM believes a more accurate calculation would be
based on the total gallons of fuel consumed over a period of time
(annually). The federal government tracks annual fuel usage per type of
fuel.

In response to the DOE\'s Request for comment on specific questions, GM
provides the following answers:

1.  The proposed revised guidelines appear to encompass GM's position
    statements above and cause entities to establish boundaries that
    reflect a high level of corporate aggregation.

2.  The use of Ownership and/or Management/Operational control should
    provide a 'reasonable' approach to establishing boundaries that are
    appropriate for reporting.

3.  The DOE should NOT develop a "more prescriptive approach to the
    definition of entities, such as the requirements that entity
    definitions correspond to those used for Federal Tax Purposes," as a
    requirement for participation in reporting to the 1605(b).

4.  Trade associations should NOT be required to report to the 1605(b).
    However, trade associations should support their membership's filing
    of reports to the 1605(b) as well as registering their emission
    reductions. Trade associations should be allowed maximum
    flexibility, without obligations and restrictions for reporting
    their member's progress in reducing GHG emissions to the DOE
    1605(b).

GM's Position on Verification and Certification:

GM does not support the requirement that emissions reductions should be
certified in order to be registered. The validation of a company\'s
report by a Professional Engineer or PhD. Engineer should be sufficient
for registration purposes - for many other business purposes, i.e.
mandated air permit requirements, this suffices. The process of third
party certification can be expensive and require considerable internal
resources. As the market for GHG trades is as yet very thin, a
requirement of third party certification simply for registration would
put an undue burden on those companies, which are making reductions
without any reasonable prospect for a return on these expenditures in
most circumstances. In certain circumstances, it may be possible for
entities to make trades without third party certification (for example,
under private contract law subject to whatever due diligence the parties
deem appropriate). In the absence of mandated GHG reductions and/or any
legal obligations (beyond common law) governing GHG trades, companies
should not be expected to have third party certification. Such a
requirement would only discourage participation - and at this time, the
focus should be on maximizing participation. Third party certification
should only be expected where it is necessary to facilitate a trade.

Note: Federal law prohibits any person or entity from knowingly and
willfully making any false or fraudulent statement of any material fact
to any department or agency of the U.S. Government (18 U.S.C. 1001).
This prohibition, with its substantial penalties, should deter anyone
from making false or fraudulent submissions to 1605b.

And;

-   Internal verification and certification of data reported by a
    registered Professional Engineer (P.E.), a Ph.D. Engineer, or an
    officer of the company [should continue to be
    permitted]{.underline}.

-   3^rd^ party certification/verification should not be required at the
    time of reporting.

-   GHG reporting under the updated DOE 1605(b) Guidelines should
    [remain]{.underline} 'verifiable.' (Verifiable means that each
    company is responsible for maintaining all underlying documentation
    to support their CO2 emissions and reductions)

GM's Position on Fungible Credits/Emissions Trading:

-   3^rd^ party certification/verification should occur [if necessary to
    facilitate a trade.]{.underline}

-   Baseline protection for credits achieved by early action should be
    ensured

-   General laws governing commercial transactions should apply to any
    trades in GHG credits - no special rules are required. In other
    words, it is up to the parties to ensure that the veracity of the
    credits being traded is assured to their satisfaction.

Section D-Emission Sources and Sinks Covered

GM's response to the DOE's Request for Comment:

The Technical Guidelines and procedures for quantifying the effects of
the category of "other gases," which would include those gases under the
Montreal Protocol (i.e. CFC's HFC's, HCFC's) should use the latest
estimates of Global Warming Potentials (GWPs) established by the IPCC.
If the reporting year begins in 2003, then the IPCC Third Assessment
Report's estimation of GWP's should be used. As the GWP's are updated,
so should the reports, including the historical record per the entity.

Section G- Guidelines for Small Emitters

GM's response to the DOE's Request for Comment:

1.  GM does not support a threshold requirement defining emitter status
    in order to allow for reporting to the 1605(b). Refer to previous
    statements to Figure 1.

2.  The use of multi-year averaging to establish an entity baseline is
    an acceptable and appropriate approach that will tend to normalize
    any anomalous spikes in data that may occur. Multi-year averaging of
    an entity's baseline should be optional, not required.

3.  The Guidelines should establish the expectation that shifts should
    be declared and the baseline adjusted accordingly by entities
    requesting registration of their reductions. This should be an
    element that the EIA checks when an entity applies for registration.

Section H- Emission Reduction Calculations

GM's response to the DOE's Request for Comment:

GM would like to qualify the use of Absolute Emissions vs. Intensity
Indicators in representing the actual performance of an entity.

GM believes that absolute emissions and reductions are the only metric
that can be added and compared as a "progress" metric across industry
sectors.

GM believes that the use of Intensity Indicators should only be
submitted publicly by the entity if the entity ALSO submits absolute
totals.

The intensity metric can and should ONLY be used within the boundaries
of entity to determine the entity's performance, against itself, over
time.

The Intensity metric should NEVER be used to compare the performance of
Corporate Entity "A" against Corporate Entity "B" ... the argument is
apples to oranges...see the example below.

> For 2002, GM's U. S. Operations intensity indicator was 2.35 million
> metric tons of CO2 per vehicle produced, while its global intensity
> indicator was 1.73 million metric tons CO2 per vehicle produced. The
> variance is predominantly dependent and defined by the upstream
> generation of electricity that is being purchased by the vehicle
> manufacturer. A typical vehicle manufacturer's annual energy usage is
> approximately 60% indirect (purchased electricity). The US upstream
> generation is predominantly coal-based, whereas globally it is a
> predominant mix of nuclear and hydro (i.e. Canada), with coal and
> natural gas.
>
> If you were to compare the US CO2 intensity indicator against Canada,
> Japan, or Europe then the comparison would reveal very little about
> performance between the countries...it would, however, reveal the
> variance in upstream electricity generation.

Section I- Recordkeeping, Report Certification, and Verification

(section 300.11)

GM's response to the DOE's Request for Comment:

1.  GM supports the DOE's role in establishing criteria for identifying
    and certifying 'appropriate' independent verification firms. In
    order to encourage competition, the reporting entity should be
    allowed to choose their own independent verifier, based on the
    specific needs of the reporting entity.

2.  In response to the statement, "...the Guidelines would encourage,
    but not require, independent verification of all reports," GM
    provides the following position statement:

GM's position on Registering vs. the Reporting of GHG Data

> GM does not believe that the [reports]{.underline} would necessarily
> gain 'accuracy' through independent verification. However, in terms of
> [registering]{.underline} emissions and reductions, GM recognized that
> in some cases independent verification may be necessary to facilitate
> a trade.
>
> GM also believes that confidentiality must be maintained between the
> reporting entity and all reviewers of the emissions and/or reductions
> data.

GM Comments Regarding Data Confidentiality

-   The 1605(b) Registry is a voluntary program that should not require
    the reporting of the emissions and reductions of each facility level
    or source level data in order to evaluate progress in the reduction
    of GHG emissions. Each entity would need to collect emissions and
    reduction data from each of its facilities, but it should be allowed
    to report ONLY the aggregated totals for its US operations.
    Therefore,

-   The 1605(b) Registry should protect the confidentiality/trade secret
    concerns of the reporting company by only requiring the reporting of
    corporate-level (or aggregated) GHG totals.

    -   Data confidentiality should be preserved between the reporting
        entity and the voluntary government program. A 3^rd^ party
        certification/verification should not be required at the point
        of [reporting]{.underline} GHG emissions. However, a 3^rd^ party
        certifier/verifier may be required to facilitate a trade.

Section J - Starting to Report

GM's response to the DOE's Request for Comment:

GM supports the use of multi-year averaging to establish an entity
baseline as an acceptable and appropriate approach that will tend to
normalize any anomalous spikes in data that may occur. Multi-year
averaging of an entity's base year to establish the entity's baseline
should be optional, not required.

Section L - Registration of Emission Reductions (section 300.12)

GM's response to the DOE's Request for Comment:

GM supports 'Credit for Early Action' and would therefore submit that
the DOE should allow those entities who have recast their earlier
1605(b) reports to conform with the Revised Guidelines, to submit their
reports to the Registry for evaluation by the EIA for eligibility as
accumulated reductions before the 2002 base year indicated.

GM believes that their previously registered reductions (since 1991)
should be held in the DOE 1605(b) Registry, in order to protect credit
for early action. However, the reductions obtained by GM after 2002
should be the only reductions that "count toward the President's goal
for reducing U.S. emissions intensity by 18% between 2002 and 2012."

Section M - Sustaining Entity Reports of Emissions and Emission
Reductions

GM's response to the DOE's Request for Comment:

GM supports the statement that "only additions to cumulative emission
reductions (relative to the chosen base year or base period) would be
recognized in future years," in terms of [registration]{.underline}
only. However, the [reporting]{.underline} of emission reductions
[should not be required]{.underline} to demonstrate additionality.

Section O - Cross-Cutting and Other Important Issues

GM's response to the DOE's Request for Comment:

1\. Entity-Wide vs. Sub-Entity or Project Only Reporting

GM supports the Guidelines continuing to "provide a mechanism for
'entities' to report, but not register, the reductions resulting from
individual actions or projects affecting a part of the entity's
emissions, even if they could not demonstrate that they had achieved a
net reduction in their total emissions, relative to their physical or
economic output."

2\. Treatment of Certain Small Emissions (refer to section 300.2:
Definitions-De Minimis)

GM supports the alternative to permit entities to exclude up to 3% or
10,000 tons CO2e whichever is greater. However, from the previous
statement, the use of Ownership and/or Management/Operational control
should provide a 'reasonable' approach to establishing Boundaries that
are appropriate for reporting GHG emissions reductions, and offsets.
Therefore, an entity should be allowed, but NOT REQUIRED, to report on
any and all aspects of their owned and/or management/operationally
controlled entity regardless of emitter status.

3\. Excluding the Effects of Changes in Output on Emissions

In response to the DOE's Request for Comment: (excerpt from Part 1
Section H-Emission Reductions Calculation)

Many industries are cyclical, with significant fluctuations in demand
and therefore, output over time. If a company is successful, demand for
its products may grow over time. Companies with less energy-intensive
processes can have their GHG emissions in any given year impacted by
external factors such as weather (the requirement for greater heating
and/or cooling of facilities/machinery). Companies may decide to
consolidate operations to reduce cost, including energy per unit
produced. Companies may decide or be required to install abatement
equipment to reduce some emissions while requiring greater energy
consumption. In industries with relatively long capital investment
cycles, some companies may be ahead of others in installing new, more
efficient processes - or have made the decision earlier than their
competitors to focus on achieving GHG reductions (which is why credit
for early action is so critical). Many companies do not have control
over the energy sources for power generation - they are net takers of
indirect emission factors, which may vary considerably regionally and
internationally. All of these factors, along with many others can impact
emissions per unit produced.

It is important that reporting parameters provide a fair picture of the
conditions and management actions shaping an entity\'s GHG emissions. It
is also critical that GHG reporting requirements do not cap or
discourage an entity\'s ability to grow, invest and provide jobs in
America. Accordingly, we believe that in many cases, companies will want
to provide both measures of energy intensity as well as absolute
emissions in their reports.

However, it is important that a clear picture be available of total
absolute reductions (or increases) in GHG emissions for each reporting
entity. Accordingly, GM believes that the use of intensity indicators
should only be submitted by the entity if the entity also submits
absolute totals.

4\. Emissions and Reductions Associated with Electricity Generation and
Use

In response to the DOE's Request for Comment:

GM supports the reporting of both Direct Emissions from the burning of
Fuels (i.e. Coal, etc) and Indirect Emissions from the purchase of
Electricity, and Steam. GM also understands the requirement to
determine, up front, who "owns" the emissions and reductions associated
with both direct and indirect energy usage in order to avoid the double
counting conundrum.

*GM believes that whomever pays for the energy,*

*owns both the emissions and the reductions.*

In terms of reporting, it may be important to include in each entity's
annual report, the primary indirect electricity provider, by name, such
that the DOE can cull the information from the collective entity reports
(i.e. GM and DtE Energy) and select out those categories of reporting
that appear to be double counted. Follow-up with both entities, by the
DOE or EIA, would be required before 'eligibility' could be granted to
the categories of reductions.

5\. Reporting and Registering Changes in Terrestrial Carbon Stocks

In response to the DOE's Request for Comment:

GM supports the use of the existing spreadsheets within the DOE 1605(b)
guidelines for reporting Carbon Sequestration. However, the spreadsheets
need to be able to comprehend a far broader categorization of sinks
(trees, soils, etc) in order to allow for the reporting of international
sequestration projects.

GM also thinks that the Guidelines should allow for the reporting of
year-to-year increases in carbon stocks as "registered GHG reductions"
as well as a comparison over time from a selected base year or base
period.

6\. Recognizing Emission Offsets

In response to the DOE's Request for Comment:

GM also supports the eligibility of offsets within the 1605(b) as a
mechanism for representing an entity's GHG footprint as well as a method
for creating new 'fungible commodities.'

The inclusion of offsets is a key element of the GHG management
lifecycle and offers a means to convey the proactive actions taken by an
entity to avoid emissions through its management practices.

> An example of how GM supports the eligibility of offsets is
> illustrated in our leadership and accomplishments in the EPA WasteWise
> Program.
>
> In 2003, GM was recognized as the EPA WasteWise "Climate Partner of
> the Year" for demonstrating leadership in the management of the
> prevention, recycling, and reuse of our waste stream across US
> operations. In 2002 GM avoided emitting 4.7 million metric tons of CO2
> equivalent into the atmosphere \[based on the EPA's
> [WA]{.underline}ste [R]{.underline}eduction [M]{.underline}odel (WARM)
> Analysis\].
>
> The EPA WARM analysis assigns CO2 factors per specific categories of
> prevented, reused, and recycled non-hazardous waste (i.e. metals,
> paper, plastics, etc.) and calculates the avoided CO2 equivalent
> emissions for an entity that no longer sends that waste to the
> landfill.

The premise: *You own what you buy...* translates into: *Whoever buys
the offsets, owns the credits.*

Therefore, as mentioned in the guidelines, GM would need to communicate
with its non-owned partners (the landfills that they are using) to
determine if the landfills are already reporting the emissions and/or
reductions due to the joint activity. GM would also need to communicate
with its landfill partners to gain information on their qualifications
(regulated vs. non-regulated) as well as their practices (flaring vs.
non-flaring, methane production potential, purchase of the methane
produced from GM's waste...a closed loop cycle, etc.)

100% ownership and management control may play a lesser role in the
Offset Emissions Category for reporting, but communication of who is
reporting what and when becomes critical...Either way, the inclusion of
offset emissions in the guidelines for reporting to the 1605(b) creates
an enabler of new categories of fungible commodities.

The category of Offset Emissions should be set aside for an in-depth
discussion during the January 12, 2004 workshop.

7\. International Emission Reductions

In response to the DOE's Request for Comment:

In terms of Reporting -

GM believes that the DOE 1605(b) should allow for the reporting of
International Emission Reductions if the reporting entity chooses to
report for its international operations. This would allow for the
comprehensive reporting of a global entity's GHG Footprint.

GM also believes that the emission reductions achieved from
international activities should be allowed to count against the
Administration's 18% target, if the entity expressly allocates them as
such. However, care must be taken to ensure that entities do not double
count credits in more than one jurisdiction.

In terms of Registration-

GM believes that a 'qualified' third party should be required to verify
the international emission reductions if the entity wishes to register
them for the purpose of a trade. The DOE should consider developing the
'qualification standards' for selecting third party verifiers.

Section III: Opportunity for Public Comment:

In response to the DOE's Specific Questions

\(a\) How would the concept of entity-wide reporting be extended to
include

non- U.S. activities?

GM believes that the reporting entity should be allowed to report their
global [Inventory Management Plan (IMP)]{.underline}, (at the discretion
of the reporting company), which would include the entity's entire
global GHG footprint. The IMP would include all direct and indirect
emissions and reductions, all projects within and outside the entity
boundary, and all categories of offsets that the reporting entity wishes
to include.

\(b\) Should an entity wishing to report non-U.S. emission reductions
achieved in its own non-U.S. operations be required to inventory and
report all non-U.S. emissions and to assess changes in its emissions
worldwide? Or should such entity only be required to report on its
non-U.S. operations in specific countries?

GM believes that an entity should be allowed, but not required, to
inventory and report all non-U.S. emissions. However, in terms of
registration, if an entity wishes to submit for eligibility of credit
for its non-U.S. emission reductions, then it must inventory and report
all non-U.S. emissions in order to comprehend changes in its emissions
worldwide (Its GHG Footprint).

\(c\) What requirements should third party non-U.S. offsets be required
to meet?

GM believes that third party non-U.S. offsets should be required to
undergo independent verification from a 'DOE-qualified' third party
verifier if necessary to facilitate a trade.

\(d\) To be eligible for registration, should reports of non-U.S.
emissions reductions require independent verification?

Yes -- But only to facilitate a trade.

\(e\) What would be the implications, including for participating in the
1605(b) program, if non-U.S. activities were excluded from reporting
and/or registration?

GM believes that the 1605(b) must remain flexible and allow for those
entities that choose to report and register U.S. only, or U.S. plus
non-U.S. Note the inclusion of U.S. reporting in both options.

GM supports the reporting of non-U.S. activities if and only if the
reporting entity also includes U.S. activities.

8\. Relationship of Proposed Guidelines to Climate VISION, Climate
Leaders and other Voluntary Programs to Reduce GHG Emissions - See the
table below.

Specific to the Table in item 8:

GM has taken a leadership role in each of the voluntary energy and CO2
reduction activities listed in the previous table. Therefore, since GM
has been reporting its progress in the aforementioned programs to the
DOE 1605(b), [GM suggests that the DOE 1605(b) be the single standard
(both national and international) for GHG reporting guidelines and GHG
registration.]{.underline}

The interoperability of the all other GHG reporting standards to the
DOE1605(b) is critical to eliminating redundant resources, and
cumbersome reporting requirements across various programs.

GM is very aware of the potential cumbersome requirements of reporting
across its numerous voluntary energy and CO2 reduction programs.
Consequently, GM, and a small team of other industries (auto, utility,
aluminum, pharmaceutical, etc) helped to form an independent trade
organization called the U.S. Climate Partnership Association (USCPA)
with the primary objective to: (1) Work with the DOE to develop
"appropriate" guidelines and standards for reporting GHG emissions,
reductions, and offsets, (2) Engage and accelerate industry involvement
in voluntary GHG Management Programs (i.e. Climate VISION, Climate
Leaders, ISO) and act as the learning platform to teach and advise
industry on how to measure and report GHG emissions, reductions, and
offsets to the DOE 1605(b), (3) Demonstrate leadership in voluntary
energy and GHG reduction programs, and (4) Guide the thinking of the DOE
toward a "lifecycle" approach (including suppliers and consumers) to GHG
management practices that directly effect the business bottom line.

In summary -- GM believes that the DOE 1605(b) should be the single
national GHG REGISTRY indicating progress across all voluntary energy
and CO2 reduction programs (including those programs operated by states
and NGOs) within the U.S., at a minimum, and should allow for the
reporting and registration of non-U.S. emissions and reductions.

[ATTACHMENT A]{.underline}

[Analysis of GHG Emissions Reporting]{.underline}

*GM - U.S. Example*

A GHG Analysis was Conducted to Evaluate the Contribution of CO2
Emissions from the Following Categories of Mobile Source Emissions for
U.S. Operations:

I.  **Employee Business Travel:**

> **(GM does not own and NO accurate data are available)**

1.  Rental Vehicle Mileage

2.  Airline Travel Mileage

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II. **Company Owned Vehicles:**

> **(Calculations based on annual fuel usage. Annual totals are de
> minimis, or**
>
> **less than 1% of GM total Facility Emissions)**
>
> **III. Freight Transport: Delivery of Parts to Assembly Facilities**
>
> **(GM does not own and NO accurate data are available)**

1.  Rail Mileage

2.  Transport Mileage

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IV. **Freight Transport: Delivery of Vehicles to Dealerships**

> **(GM does not own and NO accurate data are available)**

1.  Rail Mileage

2.  Vehicle Carrier Mileage

[***Limitations*** of Reporting the Information Above:]{.underline}

-   The use of mileage in items I, III, and IV is a highly inaccurate
    means for calculating GHG emissions

-   Limited Availability of U.S. Data \[global data will be even more
    difficult to acquire\]

-   Low level of Accuracy of U.S. Data \[global data will be even less
    accurate\]

-   Time and Costs Associated with Collection and Reporting of this Type
    of Data

-   Lack of Ownership of Multi-Modal Transportation in Items I, III, IV