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November 13, 2023

Office of Policy and International Affairs

Office of Electricity and Natural Gas Analysis, PI-23

U.S. Department of Energy

Forrestal Building, Room 7H-034

1000 Independence Ave., SW

Washington, DC 20585

**[Interim Comments on Voluntary Reporting Under 1605(b)]{.underline}**

The American Forest & Paper Association (AF&PA) appreciates the
opportunity to submit additional comments on the Department of Energy's
(DOE's) Voluntary Greenhouse Gas Reporting Program known as 1605(b).
AF&PA was represented at all of DOE's 1605(b) workshops and at the USDA
forestry workshop. Changes that DOE may make to the 1605(b) program are
important to our industry, and we hope our comments will be helpful as
the agency considers needed changes.

AF&PA is the trade association and leading voice of the forest, pulp,
paper, paperboard, and wood products industry in the United States. We
represent over 200 companies and related associations engaged in
growing, harvesting and processing wood and wood fiber, and
manufacturing pulp, paper and paperboard products from both virgin and
recycled fiber. AF&PA members include manufacturers of over 80 percent
of the paper, wood and forest products produced in the United States,
and our members include non-industrial private landowners, large
multi-product producers, and family-run mills. AF&PA members own a
significant portion of the nation's commercial forests and annually
plant nearly half of all tree seedlings in the U.S.

AF&PA supplied comments in response to DOE's May 6, 2002 Notice of
Inquiry, and we want to supplement and underscore those comments in the
following areas.

1.  **Definition of Reporting Entity.** Currently, the 1605(b)
    guidelines define a reporting entity as a "legal U.S. entity,"
    meaning "any U.S. citizen or resident alien; any company,
    organization, or group incorporated under or recognized by U.S. law;
    or any U.S. Federal, state, or local government entity." It is
    important that the guidelines also recognize that trade associations
    may report industry sector emissions and reductions. AF&PA members
    recently elected to participate in the Administration's voluntary
    climate initiative for industrial sectors, and this commitment is
    based on a *collective* effort to try to meet the President's
    climate goals. AF&PA members will be evaluating themselves as an
    entity that is representative of the forest products industry, and
    the 1605(b) guidelines should be structured to accommodate reporting
    by such entities.

2.  **Emissions and Emissions Baseline.** At DOE's 1605(b) workshops,
    the Agency questioned whether emissions should be reported as actual
    emissions (tons of CO~2~ equivalent) or as an emissions intensity
    (tons of CO~2~ equivalent per unit of production). Both forms of
    reporting are valuable, as both can be used to measure progress.
    Thus we recommend that the revised registry accept both actual
    emissions and emissions intensity reports.

> Depending on operating and economic circumstances, some entities may
> choose to measure actual emissions and look at improvements on that
> basis. However, some operating circumstances may favor measuring
> progress on an intensity basis. Increases in production or expanding
> operations may cause actual emissions to increase, but when viewed on
> an intensity basis, emissions per unit of production may be
> decreasing. Using an intensity measure reflects improvements in energy
> efficiency and corresponding reductions in greenhouse gases as
> productivity and economic output improve.
>
> Reporting entities should adopt a fixed baseline or baseline year, but
> flexibility needs to be maintained in establishing such a baseline.
> Entities need to be given an opportunity to evaluate the optimum
> timeframe or appropriate emissions level. For example, over the past
> decade, the forest products industry's energy use and thus greenhouse
> gas emissions have fluctuated with changes in the economic cycle,
> increasing use of biomass fuel, increasing combined heat and power
> output, and switching from coal to natural gas. Because of changes
> that occurred in the past and continue to be developed and
> implemented, entities need an opportunity to determine the most
> accurate baseline year or emissions level. Once established, this
> baseline can be used to measure future progress.

3.  **Emissions Accounting Tools**. Development of an appropriate
    calculation tool that recognizes each industry's unique attributes
    is crucial when accounting for emissions. AF&PA, working with forest
    and paper associations from around the world, developed an
    international methodology for estimating greenhouse gas emissions.
    The resulting industry-specific calculation tool is based on
    protocols developed by the World Resources Institute/World Business
    Council for Sustainable Development (WRI/WBCSD) and the United
    Nations\' Intergovernmental Panel on Climate Change (IPCC). The tool
    was peer reviewed and endorsed by the GHG Protocol Initiative -- an
    international collaboration led by WRI and WBCSD -- and has been
    adopted as the pulp and paper mill module under the GHG Protocol
    Initiative. AF&PA and WRI recommend that the calculation tool be
    recognized by governments, as well as by domestic and international
    organizations, establishing protocols and developing calculation
    techniques as the appropriate tool for calculating greenhouse gas
    emissions for pulp and paper mills. Thus we recommend that the
    1605(b) registry recognize AF&PA's pulp and paper mill tool as the
    appropriate methodology for determining emissions from such
    facilities.

> AF&PA members are also developing an accounting method for use by wood
> products facilities, and this tool will be complete by the end of
> 2003.

4.  **Avoided Emissions**. It is important that the registry continue to
    recognize those activities and changes in energy use that avoid
    greenhouse gas emissions. In the forest products industry, emissions
    are avoided through several fundamental industry practices.

The industry leads all other manufacturing sectors in onsite electricity
generation, meeting more than half of its own energy needs through
highly efficient co-generation processes using biomass fuels derived
from wood waste products. Where this electricity is not used on site, it
is exported, and the export of excess power or steam should be
recognized as avoiding emissions in other locations. This is especially
important when the power is produced from biomass -- or emissions
neutral fuels. Such recognition and credit creates added incentives for
generating power for export. Additionally, increased co-generation of
power from fossil fuels should be recognized.

> The forest products industry also has a strong commitment to
> recycling, which by keeping products in service, avoids greenhouse gas
> emissions from landfills. AF&PA estimates that the emissions avoided
> by this practice are significant. Since the early 1990s, U.S.
> companies have invested billions of dollars in new recycling capacity
> to meet the demand for increased use of recycled paper. The industry
> has reached 48 percent recovery rates with the demand for recovered
> fiber continuing to rise. A recovery rate objective of at least 50
> percent will soon be met and lead to corresponding reductions in
> greenhouse gas emissions by facilitating sequestration and avoiding
> methane emissions from landfills. Recovered paper now accounts for
> approximately 37 percent of the domestic paper industry fiber supply,
> and AF&PA members continue to support aggressive recycling goals.

5.  **Transferable Credits and Verification of Credits.** To encourage
    participation in a voluntary system, it is important to establish a
    system that allows maximum flexibility and minimizes restraints.
    Under a voluntary system, trading between companies likely will
    focus on acquiring credits from emissions reduction or sequestration
    projects that can be "banked" for future use in a trading system or
    international markets.

> The current guidelines and EIA forms require that the reporter
> self-certify the accuracy of reported information, and independent
> certification or verification is not required. However, DOE and others
> have asked if more stringent verification should be required.
> Independent verification of reported information is not necessary in
> all cases, as companies reporting the information maintain in-house
> professional engineers and certified public accountants to verify the
> data. These are professionals who adhere to the same standards as
> their third-party peers.
>
> Situations requiring independent verification -- such as certification
> of transferable credits -- should be left to the appropriate market
> regulator. The registry should be used to register but not to certify
> reductions.

6.  **Confidentiality**. At the DOE workshops, questions about
    confidentiality of the data arose. The statute establishing the
    voluntary reporting program requires that "trade secret and
    commercial or financial information that is privileged or
    confidential shall be protected..." \[42USC3385(b)(3)\]. This is an
    important provision to maintain, as it encourages participation in
    the program.

> In May 2002, DOE requested comments on whether or not they should
> require reporters to waive this statutory protection in order to
> obtain transferable credits or protection against penalty under future
> climate policy. Credits and policy-change-protection were proposed by
> President Bush in his February Climate Initiative, and the President
> did not condition his proposal on waiving the underlying statutory
> protections. Information involving trade secrets and commercial and
> financial data should be maintained as confidential. Such information
> is vital to a company's competitive advantage in the market place. To
> require that confidential, business data be made public would dissuade
> many companies from reporting. Additionally, a fact sheet accompanying
> the President's announcement stated that improvements in the
> greenhouse gas registry will give businesses incentives to invest in
> new, cleaner technology and voluntarily reduce emissions. Maintaining
> the confidentiality provision of the registry will encourage
> investments in new technologies by protecting proprietary information.

7.  **Recognition of Sequestration**. Finally, we want to point out the
    contribution that forest and product sequestration plays in
    offsetting emissions. The forest products industry contributes to
    carbon sequestration in several important ways by:

-   Practicing sustainable forestry -- which preserves and enhances
    stored (or sequestered) carbon -- on industrial woodlands and
    encouraging the practice of sustainable forestry on non-industrial
    woodlands. These practices include afforestation and reforestation
    activities as well as maintaining forest conservation areas such as
    stream side management zones and wildlife corridors.

-   Manufacturing and recycling forest products that store significant
    amounts of carbon.

> It is well understood that forests sequester carbon; however, when
> trees are harvested, they are converted to products that continue to
> store carbon for many decades or, in many cases, centuries. In fact,
> the amount of carbon stored in forest products may be increasing at a
> higher rate than the amount of carbon stored in forests. Additionally,
> residuals from these operations and wastes derived from creating
> products are a source of renewable energy. Thus, it is important that
> the 1605(b) registry recognize the value of sequestration and carbon
> storage in balancing and offsetting greenhouse gas emissions.
>
> We hope these comments are helpful in preparing the revised
> guidelines. If we can answer any additional questions, please do not
> hesitate to contact me at 202-463-2709.
>
> Sincerely,
>
> ![](media/image2.png){width="2.2916666666666665in"
> height="1.0729166666666667in"}
>
> F. Dee Gavora
>
> Director, Environmental Policy