Dear Ladies and Gentlemen,
We herewith inform you about updates and clarifications in the ISCC System. Please share this information with all relevant members of staff.
1. Double Accounting of GHG Savings
We herewith point out that the sustainability characteristics of a specific amount of (sustainable) product can generally be used for one application only (e.g. as biofuel under the EU Renewable Energy Directive – RED). Please be aware that “double accounting” is not allowed under ISCC. ISCC document 203 (page 33) specifies the following:
“If a company is simultaneously certified under more than one certification scheme so-called double accounting must not take place. An example of double accounting is: A company certified under ISCC and another certification scheme X delivers a certain amount of material once classified as sustainable under ISCC and delivers the same amount once again classified as sustainable under the scheme X.”
This requirement applies not only if a company uses other biofuel certification schemes (e.g. those recognised under the RED). This requirement also applies if a company participates in other systems or regimes that cover the same sustainability characteristics, such as greenhouse gas (GHG) savings or renewability. Furthermore, this requirement covers individual agreements between companies which intend to claim the respective sustainability characteristics (e.g. the GHG savings) in bilateral agreements.
This means it is prohibited to “double account” amounts of sustainable products, and it is also prohibited to double account individual sustainability characteristics, such as the GHG savings.
Example: If a company has implemented methane capture devices which result in higher GHG savings of their output (e.g. crude or refined oil, biofuel or bioliquid), these GHG savings may be accounted for under the framework of ISCC EU (i.e. issuing an ISCC Sustainability Declaration or Proof of Sustainability). However, in this scenario the company would not be allowed to use the GHG savings additionally in the framework of other systems or regimes such as the clean development mechanism (CDM). Accounting of GHG savings related to one batch of material under ISCC and under the CDM regime (or others) at the same time would be considered as double accounting and must not take place.
2.1 Palm Oil Mill Effluent
Palm Oil Mill Effluent (POME) is a waste water/sludge arising at a palm oil millduring the palm oil production process. This waste water is released to a system of ponds (POME ponds) to remove solids, oil and grease before discharging the water into waterways. The oil contained in the waste water (POME oil) settles on top of the POME pond and can be extracted (skimmed off) and used as feedstock for biofuel production.
We herewith point out that the term POME oil exclusively refers to oil that is skimmed off a so-called POME pond. It is not allowed to classify other types of oils (e.g. crude palm oil, palm fatty acid distillate, spent bleaching earth oil, free fatty acids, etc.)as POME oil.
Please also be aware that the declaration of POME oil under ISCC (on sustainability declarations or Proofs of Sustainability) shall always explicitly refer to the term POME. Material that is labelled e.g. as “palm sludge oil”, “sludge palm oil” or “palm acid oil” cannot be considered as POME oil under ISCC.
2.2 Disaggregated Default Values for Transport
Please be aware that disaggregated default values (DDVs) for transport and distribution can only be applied if a respective value for the specific raw material and pathway is provided within the Renewable Energy Directive (RED).
Example: For bioethanol there are DDVs provided for the transport and distribution of ethanol made from sugar beet, wheat, corn and sugar cane. In case bioethanol is produced from other raw materials for which no DDV is provided in the RED (e.g. grape marc, wine lees or bagasse), actual GHG emissions for transport and distribution must be calculated.
2.3 Downstream Emissions for Transport and Distribution
Due to inquiries from market participants we herewith clarify the procedure how to deal with actual GHG emissions for transport and distribution of final biofuels or bioliquids. A biofuel or bioliquid is considered to be final, if no further processing of the material takes place. ISCC document 205 (chapter 4.3.9) specifies the following:
“The producers of final biofuels and bioliquids (herein afterwards called final processing unit) must additionally include emissions from the downstream transport and distribution according to the formula provided in chapter 4.3.4 “Emissions from transport and distribution (etd)”. (…) Additionally, the final processing unit must calculate the GHG emissions of all elements of the calculation formula in g CO2eq/MJ biofuel and the GHG saving potential of the final biofuel.”
This means that the final processing unit (e.g. a biodiesel plant, bioethanol plant or HVO plant) has to determine the downstream transport and distribution up to the final market (the filling station). Should the exact distance for transport and distribution not be known to the final processing unit, conservative assumptions must be made (e.g. transport to Europe and throughout Europe). The final processing unit then calculates the emissions for downstream transport and distribution and subsequently the final GHG value and the GHG savings of the biofuel or bioliquid.
The final GHG value includes all emissions for downstream transport and distribution (up to and including the filling station) and will/must not be amended by any downstream operators (e.g. by traders).