Greenhouse Gases: Who's Cheating?

As the world gets serious about fighting climate change, a huge question looms: Are countries and companies really reducing their greenhouse gas emissions as much as they claim? The answer is crucial not just for the planet, but for business. The tighter the limits on emissions, the higher the price companies have to pay to pollute—and, conversely, the more profits some companies will reap by releasing less gas and monetizing the reductions under the umbrella of cap and trade. Considering the billions of dollars at stake, "can we really trust what's reported?" asks Pieter P. Tans, senior scientist at the National Oceanic & Atmospheric Administration's Earth System Research Laboratory in Boulder, Colo.

Tans and many other researchers worry that the answer is no. Typically, the emissions of a company or nation are calculated from the bottom up—sort of like figuring out what you weigh by looking at what you eat. Start with data on, say, the amount of coal shoveled into a power plant or the millions of barrels of crude oil going into refineries. Then estimate out how much carbon dioxide is produced when the coal is burned, or when the oil is turned into gasoline to power cars.

Such calculations may appear precise; so did the numbers from Enron and its accountants at Arthur Andersen, notes Ray Weiss, distinguished professor of geochemistry at the Scripps Institution of Oceanography. The original data may be wrong, or the assumptions flawed. Relying on self-reported emissions and paper audits "seems to be asking for misdeclaration or even fraud, at all levels from local emitter to great nation," says geologist Euan Nisbet at the University of London, who heads the European Union's methane monitoring program.

Consider sulfur hexafluoride (SF6), a man-made gas used to insulate transformers and other electrical equipment. It's a potent greenhouse gas, 23,900 times more powerful than CO2. That means under cap and trade, the price you pay for the right to emit one ton of SF6 is also 23,900 higher than the price of CO2—which is now $18 per metric ton in Europe. Under the U.N. Framework Convention on Climate Change, industrialized countries report how much of the stuff they're pumping into the atmosphere. They calculate emissions using information on how much SF6 manufacturers sell to customers and estimates of how much escapes to the atmosphere from devices or production facilities. If you believe the reports, emissions of SF6 are declining.

The reports are wrong. When researchers actually measure the chemical in the air, they find it in quantities more than three times greater than what the reported amounts would indicate—and levels are increasing, not declining. The findings were a surprise, says NOAA's Tans: "It wasn't on anyone's radar screen."

Why the discrepancy? No one knows for sure. Some of the blame goes to China, which hasn't been required to report emissions and which has balked at submitting to international verification. But the gap is too large to be explained just by emissions from developing countries. Another probable cause is under-reported emissions in the U.S. While utilities and other companies recycle the gas by sucking it out of aging equipment, more of it may escape than workers realize or report. "We have a very big issue, not just internationally but also domestically," says Lukas Rothlisberger, CEO of DILO, a leader in SF6 maintenance and recycling equipment: "Some of the numbers used, in my humble opinion, are very flawed."

It's a cautionary tale. "If we can cheat on something like sulfur hexafluoride, what happens when carbon dioxide is worth $50 or $100 per ton?" asks Michael R. Woelk, CEO of Picarro, a measuring instruments company in Sunnyvale, Calif. SF6 is not unique. Scripps' Weiss has found more than three times as much nitrogen trifluoride (NF3) in the atmosphere as he expected. NF3 is a chemical used in flat panel manufacturing—and is a powerful greenhouse gas. Methane measurements reveal that some reported emissions are low compared with atmospheric levels, and that purported reductions from capturing methane at landfills are vastly overstated. The track record for estimating carbon dioxide emissions is better, says Tans, "but if emissions cost a large amount of money, I'm not sure that will be the case."

There may be a solution, researchers say: Step up efforts to measure greenhouse gases in the atmosphere, both globally and locally. In the past few years, companies such as Picarro, Los Gatos Research, and LI-COR have developed instruments capable of continuously monitoring concentrations of trace gases in the air. That saves scientists the chore of collecting samples in flasks and bringing them back to the lab for analysis. "The new instruments have been revolutionary, from a science perspective," says biologist Joe von Fischer of Colorado State University.

Von Fischer, who has no financial stake in any of the measuring equipment companies, has used such instruments to find hotspots of methane wafting from the Alaskan tundra. This is helping to address the question of whether Arctic warming will speed up such emissions. Others are monitoring methane from cows and termite mounds, spotting CO2 plumes from rush hour traffic, or watching to see if CO2 pumped into the ground will stay there or leak out. "There's only one way to validate what's really happening, and that's to measure it," says Doug Baer, president of Los Gatos Research in Mountain View, Calif.

Scientists' current efforts only scratch the surface of what's needed, however. NOAA's Tans figures a system of instruments capable of keeping emissions reporting honest would be more than 10 times larger than today's monitoring networks and would cost $100 million or more. Right now, that's a tough sell. "Monitoring is science's Cinderella, unloved and poorly paid," laments Nisbet.

That could change as emissions become more valuable, upping the pressure to report them more accurately. Another hopeful development occurred at the Copenhagen climate talks in December, where developing countries agreed to some international verification of their emissions cuts. Such oversight is essential to prevent greenhouse gas emissions from becoming a house of mirrors. Says Doug Rotman, program director at Lawrence Livermore National Laboratory, "To get top-down monitoring will be a struggle, but it is really what we have to do."

With Mark Scott in London

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