CSCS. CARBIO Sustainability Certification Scheme. EUROCLIMA Project - Expert Consultation EC-JRC / INTA

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1 CSCS CARBIO Sustainability Certification Scheme EUROCLIMA Project - Expert Consultation EC-JRC / INTA Buenos Aires, March 2011

2 About CARBIO The Argentine Biofuels Chamber gathers the largest producers and exporters of biofuels in Argentina Sustainability issues are one of the major areas of focus of CARBIO Mission: to generate and add sustainable value to biofuels production in Argentina

3 Members CARBIO members produce and export in excess of 95% of all Argentine Biodiesel

4 Who we are Total Biodiesel Plants: 12 Installed Capacity: >2,400,000 Mton/year of biodiesel CapEx Investment: > US$700 Mill (+ working capital). Most plant technology is EU origin Employment generated: more than de jobs, direct and indirect Value added to the National Economy: US$1.400 Mill (by export revenues and import substitutions)

5 Plants Location

6 Feedstock Supply: Efficient and competitive location Santa Fe Corrientes Entre Rios San Lorenzo Rosario 15km Uruguay 330km Argentina Buenos Aires Source: MAGPyA

7 Argentina is leader in the export of vegetable oils and meals Participation on the global market (%) Position Leader 2005/ / /08 Soybean - Meal 46.6% 1 st Argentina Soybean - Oil 55.5% 1 st Argentina Sunflower - Oil 29.7% 1 st Argentina Peanut - Oil 27.8% 1 st Argentina Peanut - Beans 22.1% 1 st Argentina Sunflower Meal 27.4% 2 nd Ukraine Maize 14.6% 2 nd USA Sorghum 10.1% 2 nd USA Soybean - Beans 14.5% 3 rd USA

8 Crushing plants in Argentina are the most efficient in the world Installed Capacity Plants Installed Capacity 5 largest plants COUNTRY Per day Mton Annual MM Mton Number Average per plant (Mton/day) Average per plant (Mton/day) ARGENTINA USA , BRAZIL CHINA 42.00

9 CARBIO Sustainability Certification Scheme

10 Objective The EU is the main market for Argentine biodiesel We must therefore demonstrate full compliance with European legislation CARBIO took the decision to develop our own Certification Scheme, for biodiesel from soybeans produced in Argentina We seek recognition from the EC as a full Voluntary Certification Scheme under RED requirements Biodiesel from Argentina is sustainable. We are ready to demonstrate compliance with all sustainability criteria

11 Key features Land use change: No conversion of land from non-agricultural to produce soybeans, after Jan 1 st, 2008 GHG savings: Calculated by the sum of default values (for cultivation and transport) and ACTUAL value for processing Chain of Custody: Track and trace by a Mass Balance Method- from the farm to the port

12 Land use change Each consignment either by truck or rail- already comes with a waybill (carta de porte), which states the origin of the load First Gathering Point checks the origin and verifies if the origin is a Go-Area, as per the approved maps and lists INTA National Institute of Agricultural Technology- provides the maps and lists of Go-Areas, and keeps them updated

13 Land use change: Maps and satellite pictures LANDSAT satellite image. Resolution = 30 m Pergamino, Buenos Aires, January 2007

14 Approved Go Areas INTA elaborated maps at national level, with as many political divisions as possible (cuartel, distrito, etc), equivalent to a NUT 3 level These maps identify land with agricultural use previously to January 2008 A layer with soil use capacity was added These maps are assembled over high definition images, adjusted and georeferenced (GIS), in a system that allows auditing by visiting the zone guided with GPS Based on the information from these maps, INTA generated a list with all the political divisions that are proposed as Approved Go Areas This list is used at first gathering point to determine the Mass Balance between RED-compliant and non-red-complaint soybean on Land Related Criteria

15 Greenhouse Gases Calculation From EU- RED Annex V; GHG emissions formula is: E = e ec + e l + e p + e td + e u e sca e ccs e ccr e ee Where: E = total emissions from the use of the fuel (soybean based biodiesel e ec = emissions from the cultivation raw material (soybean) e l = annualised emissions from carbon stock changes caused by land-use change e p = emissions from processing e td = emissions from transport and distribution e u = emissions from the fuel in use e sca = emission savings from soil carbon accumulation via improved agricultural management e ccs = emission saving from carbon capture and geological storage e ccr = emission saving from carbon capture and replacement; and e ee = emission saving from excess electricity from cogeneration

16 Greenhouse Gases Calculation For CSCS, the formula resolves: E = e ec + e l + e p + e td + e u e sca e ccs e ccr e ee e ec = 19 gco 2eq /MJ (Default value for cultivation) e l = 0 gco 2eq /MJ (Since there are not land use change) e p = to be calculated by each processing plant (Actual value, including effluents, waste and chemicals used) e td = 13 gco 2eq /MJ (Default value for transport & logistics) e u = 0 gco 2eq /MJ (Emissions from the fuel in use is 0, as per RED) e sca = 0 gco 2eq /MJ (Savings from improved Agricultural Management is 0, as more data is gathered, ) e ccs = 0 gco 2eq /MJ (Savings from C capture and geological storage is 0) e ccr = 0 gco 2eq /MJ (Savings from carbon capture and replacement is 0) e ee = 0 gco 2eq /MJ (Savings from excess electricity from cogeneration is 0)

17 Greenhouse Gases Calculation Estimated GHG emissions from Argentine soybased biodiesel: E(gCO 2eq /MJ) = e ec (default)+e p (actual)+e td (default) E(gCO 2eq /MJ) = * From 44.5 (gco 2eq /MJ) 18* + 13 = to 50 (gco 2eq /MJ)» 44.5 gco 2eq /MJ means 47% savings of GHG emissions»50gco 2eq /MJ means 40% savings of GHG emissions * This figure needs to be measured by each plant (E4tech estimation is 12,5; ICSC 13,2; JRC 18 gco 2eq /MJ)

18 Chain of Custody = Documents Proof of Compliance Certificate of Compliance

19 Internal and External Auditing of the Scheme Two level of auditing: INTERNAL: CARBIO requires the Members to be audited. Third party verification bodies will audit the correct application of the scheme by Members (processors; crushers; warehouses; etc.) EXTERNAL: CARBIO system will be audited by an external, independent auditor. INTA s application of methodology will also be audited

20 CARBIO Sustainability Certification Scheme - Reporting CARBIO scheme will report on the following aspects at national level: Labor Forced or compulsory labor Child labor Freedom of association Equal Remuneration of men and women workers GAP (Good Agricultural Practices) Water, soil and air quality is protected or improved Waste is minimized

21 Thank you for your attention!