A 30-day public consultation is starting on the criteria that will determine if a geothermal energy project is eligible for Climate Bonds Certification, the Climate Bonds Initiative (CBI) announced today.
One of the purposes of these criteria is to distinguish low-emitting from high-emitting projects, because in certain cases geothermal power plants can actually result in higher direct greenhouse gas (GHG) emissions than fossil fuel equivalents. This happens, for example, when drilling through rock types leads to fugitive GHG emissions.
The criteria also aim to avoid certifying geothermal projects which displace other renewables; exclude projects where emissions are poorly understood; and exclude projects which do not meet acceptable standards in terms of environmental impact,
health,safety and induced seismicity.
Under the rules, subject to the current consultation, the geothermal projects that should be allowed to issue climate and green bonds include:
-- New or existing geothermal projects where estimated emissions performances are negligible. The estimation must use a GHG accounting methodology.
-- Technology upgrades to a binary cycle power plant to address fugitive GHG emissions by implementing a closed loop system that returns GHG gases to the existing reservoir.
-- Clean Development Mechanism (CDM) approved project with negligible emissions.
In addition to these, the eligible geothermal projects must be compliant with the environmental regulations at the national and local level, and with one of the international guidelines and standards on environment, health and safety for geothermal power generation. More details on the consultation are available here.
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