CARGILL HIGH RIVER METHANE CAPTURE OFFSET PROJECT THIRD -PARTY VERIFICATION REPORT REPORTING PERIOD : JANUARY 1, 2015– DECEMBER 31, 2015 Submitted to: Blue Source Canada ULC Suite 700, 717 th Avenue SW Calgary, AB T2P 3R5 Submitted by: ClearSky Engineering Inc. 221 Drake Landing Lane, Suite 1 Okotoks, AB T1S 2M4 April 5, 2016 TABLE OF CONTENTS 1. PROJECT SUMMARY INFORMATION .................................................................... 1 2. VERIFICATION SUMMARY INFORMATION ........................................................ 2 3. INTRODUCTION............................................................................................................ 2 4. OBJECTIVE .................................................................................................................... 3 5. SCOPE .............................................................................................................................. 4 6. PROGRAM CRITERIA ................................................................................................. 4 7. VERIFICATION STRATEGY ...................................................................................... 4 8. VERIFICATION PLAN .................................................................................................. 5 8.1. VERIFICATION PREPARATION & PLANNING ............................................................................ 5 8.2. SITE VISIT ................................................................................................................................ 5 8.3. EMISSION REDUCTION QUANTIFICATION ASSESSMENT ......................................................... 8 8.4. PROJECT DATA MANAGEMENT SYSTEM ................................................................................. 9 8.5. ISSUES IDENTIFIED DURING VERIFICATION .......................................................................... 10 9. SAMPLING PLAN ........................................................................................................ 12 10. VERIFICATION SCHEDULE ................................................................................. 12 11. VERIFICATION FINDINGS ................................................................................... 13 12. CONFIRMATIONS ................................................................................................... 14 13. STATEMENT OF VERIFICATION ....................................................................... 15 REFERENCES ...................................................................................................................... 17 APPENDIX A: STATEMENT OF QUALIFICATIONS ................................................. 18 APPENDIX B: CONFLICT OF INTEREST CHECKLIST ........................................... 21 APPENDIX C: PEER REVIEW ........................................................................................ 24 APPENDIX D: VERIFICATION PLAN ........................................................................... 26 CARGILL HIGH RIVER METHANE CAPTURE PROJECT VERIFICATION REPORT FOR 2015 VINTAGE YEAR i LIST OF TABLES Table 1-1 Project Summary Information.............................................................................. 1 Table 2-1 Verification Summary Information ...................................................................... 2 Table 8-1 Site Visit Attendees.............................................................................................. 5 Table 8-2 Automated vs Manual Data Collection .............................................................. 10 Table 8-3 Verification Issue Log........................................................................................ 11 Table 11-1 Final Summary of Unadjusted Differences (SUD) Table ................................. 13 LIST OF FIGURES Figure 3-1 Arial View of Cargill High River Methane Capture Project................................ 3 Figure 8-1 Anaerobic Lagoon Covers ................................................................................... 6 Figure 8-2 Protocol Quantification Approach ....................................................................... 8 LIST OF ACRONYMS Acronym Definition AEP Alberta Environment and Parks BOD Biological oxygen demand CH 4 Methane CO 2e Carbon dioxide equivalent GHG Greenhouse Gas GWP Global Warming Potential HHV Higher Heating Value PPE Personal Protective Equipment QA/QC Quality Assurance / Quality Control SCADA Supervisory Control and Data Acquisition SGER Specified Gas Emitters Regulation SS Sources/Sinks SUD Summary of Unadjusted Difference CARGILL HIGH RIVER METHANE CAPTURE PROJECT VERIFICATION REPORT FOR 2015 VINTAGE YEAR ii 1. PROJECT SUMMARY INFORMATION Table 1-1 Project Summary Information Project Title: Cargill High River Methane Capture Project Project Description: The Project captures biogas containing methane for fuel use that would have been released to the atmosphere from the anaerobic treatment of wastewater. Project Location: 472 Avenue & Hwy 2A North P.O. Bag 3850 High River, Alberta T1V 1P4 Latitude: 50.626979, Longitude: - 113.879085 Project Start Date: October, 2003 Credit Start Date: January 1, 2004 Credit Duration Period: January 1, 2004 - December 31, 2016 (extension granted to initial 8 year crediting period) Expected Lifetime of the Lifetime of the equipment, expected to be far in excess of the credit Project: duration period. Actual Emission Reductions / From January 1, 2015, to December 31, 2015, the project emission Removals Achieved: reductions are asserted to be 70,284 tonnes CO 2e. Applicable Quantification Alberta Environment, Quantification Protocol for Anaerobic Protocol: Treatment of Wastewater Projects, Version 1, March 2009 Other Environmental No other environmental attributes, credits, or benefits are being Attributes: sought or created by this Project. Project Registration: The project offset credits will be registered with the Alberta Emissions Offset Registry (AEOR) which tracks the creation, sale and retirement of credits. Ownership: Cargill Meat Solutions, A Division of Cargill Limited Project Activity: This activity meets all the eligibility criteria for the Alberta offset system as described in Section 1 of the Offset Project Report. Project Contacts: Authorized Project Contact Project Proponent Kelly Parker, B.Sc. Michael Bernardo Carbon Services Project Analyst Environmental Supervisor Blue Source Canada ULC Cargill Meat Solutions Suite 700 472 Avenue & Hwy 2A North 717-7th Avenue SW P.O. Bag 3850 Calgary, AB T2P 0Z3 High River, AB T1V 1P4 p: (403) 262-3026 p: (403) 652-4688 ext.482 e: [email protected] e: [email protected] CARGILL HIGH RIVER METHANE CAPTURE PROJECT VERIFICATION REPORT FOR 2015 VINTAGE YEAR 1 2. VERIFICATION SUMMARY INFORMATION Table 2-1 Verification Summary Information Objective: Develop a conclusion with a reasonable level of assurance as to whether the greenhouse gas emission reduction assertion is free from material misstatement, and is presented fairly in accordance with the Specified Gas Emitters Regulation (SGER) and the Alberta offset system program criteria. Summary: We have found the Offset Project Report for the Cargill High River Methane Capture Project, version 1.0, dated April 2016 and the 2015 GHG Emission Reduction Assertion to be reliable, complete, and in compliance with the requirements of the SGER and the Alberta offset system program criteria. Lead Verifier: Klym Bolechowsky, P.Eng. ClearSky Engineering Inc. p: (403) 982-5596 e: [email protected] w: www.ClearSkyEng.com Peer Reviewer: Kurt J. Hansen, M.Sc., P.Eng. Green Inc. p: (403) 398-3981 e: [email protected] Designated Signing Authority: Klym Bolechowsky, P.Eng. Verification Dates: The verification was carried out from November 20, 2015 – March 31, 2016, inclusive. Site Visit Date: December 3, 2015 Report Date: April 5, 2016 3. INTRODUCTION ClearSky Engineering Inc. was engaged by Blue Source Canada ULC (Blue Source) to verify 2014 vintage year offset credits generated by the Cargill High River Methane Capture Project. The offset project was verified at a reasonable level assurance against the Quantification Protocol for Anaerobic Treatment of Wastewater Projects, Version 1.0, March 2009, the Offset Project Plan, v3.0, April, 2016, and the program requirements of the Specified Gas Emitters Regulation (SGER). Blue Source (the authorized project contact) prepared the offset project documentation and GHG Emission Reduction Assertion on behalf of the project proponent, Cargill Meat Solutions, A Division of Cargill Limited (Cargill). The Project was implemented in October 2003 when the wastewater treatment lagoons were covered with a geo-membrane and a biogas capture system was installed to enable capture of the methane-rich biogas. After conditioning (water vapour removal & gas compression), the biogas is combusted in a facility boiler to produce steam for the meat processing plant. A flaring system was also installed to burn any unused biogas. CARGILL HIGH RIVER METHANE CAPTURE PROJECT VERIFICATION REPORT FOR 2015 VINTAGE YEAR 2 The captured biogas displaces approximately 30% of the natural gas required by the meat processing plant. The generated carbon offsets are from the avoidance of methane emissions created through the combustion of fossil fuel in a boiler and the avoided fugitive release of methane from the anaerobic wastewater lagoons. In the baseline condition, the facility was emitting 100% of the biogas from the treatment lagoons to the atmosphere. The Project was