Economic Activity-based Emission Factors Motor Vehicle Loans Emission Factors Database methodology Database methodology April 2020 April 2020 Motor Vehicle Loans Emission Factors – Database Methodology Table of Contents 1. Overview ................................................................................................................... 4 1.1. Definitions ................................................................................................................................... 5 1.1.1 Emission factor of a vehicle...................................................................................................................... 5 1.1.2 Emission rate of a vehicle ......................................................................................................................... 5 1.1.3 Propulsion types ....................................................................................................................................... 5 1.1.4 Scopes 1 and 2 emissions ......................................................................................................................... 5 1.2. Methodology tree ....................................................................................................................... 6 2. Detailed methodology ............................................................................................... 7 2.1. Primary method: make-and-model data ..................................................................................... 7 2.1.1. Equation .................................................................................................................................................... 7 2.1.1. Country-source matrix.............................................................................................................................. 8 2.2. Secondary method: average vehicle type data ......................................................................... 10 2.2.1. Equations................................................................................................................................................ 10 2.2.2. Countries matrix .................................................................................................................................... 11 3. Sources and assumptions ......................................................................................... 12 3.1. Make-and-model data ............................................................................................................... 12 3.1.1. U.S. EPA’s FTP ........................................................................................................................................ 12 3.1.2. EU EEA’s WLTP ....................................................................................................................................... 12 3.1.3. Other regions ......................................................................................................................................... 13 3.2. National and regional data ........................................................................................................ 13 3.2.1. ICCT Transportation Roadmap .............................................................................................................. 13 3.2.2. ITF-OECD Transportation performance indicators .............................................................................. 14 3.2.3. Electricity emission rates ....................................................................................................................... 14 3.2.4. State- and province-level data (USA & CAN) ........................................................................................ 14 2 Motor Vehicle Loans Emission Factors – Database Methodology List of acronyms BTU British Thermal Units CO2 (gCO2, tCO2) Carbon dioxide (gram of carbon dioxide, ton of carbon dioxide) EEA European Environment Agency EF Emission factor ER Emission rate U.S. EPA U.S. Environmental Protection Agency EU European Union FTP EPA Federal Test Procedure GHG Greenhouse gas ICCT International Council on Clean Transportation ICE Internal combustion engine IEA International Energy Agency ITF International Transport Forum km kilometer mi mile mpg mile per gallon NEDC New European Driving Cycle OECD Organization for Economic Co-operation and Development CAN OEE Canadian Office of Energy Efficiency PCAF Partnership for Carbon Accounting Financials TTW tank-to-wheel TP vehicle testing procedure UF utility factor Wh (kWh) watt-hour (kilowatt-hour) WLTP Worldwide harmonized Light vehicles Test Procedure WTT well-to-tank 3 Motor Vehicle Loans Emission Factors – Database Methodology 1. Overview In order to enable banks and other financial institutions to calculate the greenhouse gas (GHG) emissions associated with their portfolios of motor vehicle loans, the Partnership for Carbon Accounting Financials (PCAF) has built a database of motor vehicle emission factors for 193 different countries1, and for all the individual states and provinces of the United States and Canada. If a bank gave respectively {푛1, 푛2, … , 푛푘} loans of vehicles {푉1, 푉2, … , 푉푘} in countries { } ( ) 퐶1, 퐶2, … , 퐶푘 , it can use the PCAF database to find the annual emission factors 퐸퐹퐶푖 푉푖 associated with each one of the loan and calculate E, the total quantity of GHG emissions per year that are emitted by all vehicles being financed through these loans: 푘 ( ) 퐸 = ∑[ 퐸퐹퐶푖 푉푖 × 푛푖] 푖=1 For example, if a bank has given loans for two Toyota Yaris in Japan, one Toyota Yaris in China, three Audi TT in Korea, five heavy-duty trucks in China, and one motorcycle in Singapore, then {푛1, 푛2, … , 푛푘} = {2,1,3,5,1}, {푉1, 푉2, … , 푉푘} = {Toyota Yaris, Toyota Yaris, Audit TT, Heavy-duty truck, Motorcycle}, {퐶1, 퐶2, … , 퐶푘} = {Japan, China, Korea, China, Singapore}. The PCAF motor vehicle loans emission factors database plays the role of the function 퐸퐹 which returns 퐸퐹: (푉, 퐶) → 퐸퐹퐶(푉). The following pages explain the methodology used to develop this database. The next paragraph defines the technical terms used throughout this document and in the database itself. §1.2 provides an overview of the two types of emission factors found in the database and their associated methods: • The Primary method calculates emission factors at the make-and-model level. They are only available for passenger cars but should be used by carbon accounting financials whenever possible. • The Secondary method calculates average emission factors for broad vehicle types – passenger cars, buses, motorcycles, light commercial trucks and medium/heavy commercial trucks. Part 2 dives into the details of these two methods. Part 3 lists the sources used to develop the database and explains the important assumptions made regarding each of them. 1 The 193 United Nations member states. 4 Motor Vehicle Loans Emission Factors – Database Methodology 1.1. Definitions This paragraph defines the important technical terms used throughout this document as well as in the PCAF database. The definition of these notions is adapted to the PCAF motor vehicle loans context – they might have different meaning elsewhere. 1.1.1 Emission factor of a vehicle The emission factor (EF) of a vehicle in the PCAF database is the average mass of carbon dioxide, in metric tons of CO2, emitted by this vehicle in one year (tCO2/vehicle-year). 1.1.2 Emission rate of a vehicle The emission rate (ER) of a vehicle in the PCAF database is the average mass of carbon dioxide, in grams of CO2, emitted by this vehicle when it drives one mile (gCO2/mi). 1.1.3 Propulsion types Thermal propulsion A vehicle’s propulsion is thermal when it uses an internal combustion engine (ICE) only, burning fuel (gasoline, diesel, petroleum gas, etc.) on the road. • Fuel efficiency (FE): for a thermal vehicle, efficiency is measured as the volume of fuel combusted to cover a certain distance (e.g. liters/100 km) or equivalently the distance covered using a certain fuel quantity (e.g. mpg). Electric propulsion A vehicle’s propulsion is electric when it uses an electric motor only, with no fuel combustion. • Electric efficiency (EE): for an electric vehicle, efficiency is measured as the electric energy used to cover a certain distance (e.g. kWh/100 mi). Hybrid propulsion A hybrid vehicle uses both an ICE and an electric motor. The utility factor (UF, in %) of a hybrid vehicle is the average percentage of its total miles that it covers using its electric motor, the rest being covered by burning fuel (UF = 0% for thermal vehicles, 100% for electric vehicles). • Hybrid efficiency: a hybrid vehicle has both a fuel efficiency (e.g. mpg) and an electric efficiency (e.g. Wh/km). Using the vehicle’s utility factor and the heat content of the burnt fuel, one can calculate the average energy efficiency of the vehicle (e.g. in BTU/km). 1.1.4 Scopes 1 and 2 emissions In standard carbon accounting (as defined by the Greenhouse Gas Protocol), the GHG emissions of any entity can be broken down into “scopes”, depending on how close these emissions are related to the entity: Scope 1 include all emissions directly produced by the entity (direct emissions) and Scope 2 emissions include all emissions produced by the generation of the secondary energy consumed by the entity (indirect emissions). When the entity is a vehicle, these two Scopes can be defined as follows: Scope 1 emissions of a thermal or hybrid vehicle: Direct GHG emissions (mainly CO2) released through the tailpipe of the vehicle following