Federal offset protocol: Landfill methane recovery and destruction

Introduction

The Landfill Methane Recovery and Destruction federal offset protocol (Protocol) was published under the Canadian Greenhouse Gas Offset Credit Regulations (Regulations) that establish Canada's Greenhouse Gas (GHG) Offset Credit System. The Protocol incentivizes projects that actively recover and destroy landfill gas (LFG) to generate GHG emission reductions for which federal offset credits may be issued, provided that requirements under the Regulations and the Protocol are met.

This guidance is intended for proponents undertaking projects under the Protocol as well as related stakeholders, such as landfill site owners, consultants, and verification bodies. The guidance provides clarification, explanation, and/or justification regarding some of the provisions in the Protocol in order to help proponents understand requirements and facilitate undertaking projects. The guidance is not an overview of the Protocol nor a free-standing document; it is meant to be used along with the Protocol and the Regulations.

The information contained in this guidance does not in any way supersede or modify the Regulations or the Protocol, or offer any legal advice or interpretation of the Regulations or the Protocol. Where there are any inconsistencies between this guidance and the Regulations or the Protocol, the Regulations or the Protocol take precedence.

Protocol scope and use

Destruction of landfill methane

Methane (CH₄) emissions from landfill sites are generated by the anaerobic decomposition of organic material in the buried waste. Landfill CH₄ destruction can be achieved by the combustion of LFG in various devices, which converts the landfill CH₄ into biogenic carbon dioxide (CO₂). Since CO₂ has a lower global warming potential than CH₄, this results in a decrease in GHG emissions and a reduced impact on the climate.

Protocol applicability

A project may be registered in Canada's GHG Offset Credit System if it is located in a province or territory where the Protocol applies. The Protocol does not apply in a province or territory with a compliance-based offset system that has an active offset protocol covering the same activities as those set out in the Protocol. A list of the provinces and territories where the Protocol applies can be found in Canada’s GHG Offset Credit System: Protocols, in the Published Federal Offset Protocols table.

Proponents

A proponent undertaking a project under the Protocol may be the landfill site owner, such as a municipality, an Indigenous community, or a private entity, or an offset project developer acting on behalf of and in partnership with the landfill site owner.

Authorizations and exclusive entitlement

If the proponent is not the owner of the landfill site where the project takes place, they must have the necessary authorizations to carry out the project activities and have documents that demonstrate those authorizations, such as a contract or a municipal council's resolution.

In such situations, or if the LFG from the project site is sent to be destroyed at an adjacent facility (e.g. a commercial or industrial facility), or to a station for injection into a natural gas network, the proponent must ensure they retain exclusive entitlement to claim the credits issued for the GHG emission reductions generated by the project and have documents that demonstrate that exclusive entitlement, such as a contract or written agreement between the proponent and the other entity.

For cases where the proponent is not the landfill site owner, or the LFG from the project site is sent to be destroyed at an adjacent facility, information regarding the financial arrangements between the proponent and the other entity does not need to be disclosed within the project registration application or project reports.

Further information on the requirements related to having exclusive entitlement to claim federal offset credits, the necessary authorizations to carry out project activities and direct financial incentives is available in the Overview: Canadian Greenhouse Gas Offset Credit System Regulations under the Greenhouse Gas Pollution Pricing Act.

Aggregation

Projects undertaken under the Protocol can be aggregated to pool GHG emission reduction potential and reduce costs related to project implementation and verification. Aggregation may be beneficial for small landfill sites, including landfill sites located in rural areas or serving Indigenous communities.

The Protocol does not contain project type specific requirements for aggregation; all relevant requirements for aggregation are set out in the Regulations.

Eligibility

Eligible landfill sites

A project undertaken under the Protocol can be located at a public or private landfill site in Canada in a province or territory where the Protocol applies. The landfill site can be open (active and accepting waste) or closed (no longer accepting waste).

If a landfill site is located at a facility that is covered by a federal or provincial carbon pollution pricing mechanism, including the federal Output-Based Pricing System, and the GHG emissions from the landfill site are included in the facility’s total emissions, a project located at this landfill site is not eligible under the Protocol.

Legal additionality

The proponent of a project is responsible for identifying all legal requirements (e.g. from federal, provincial, or territorial regulations; municipal by-laws; permits; etc.) that are applicable to the landfill site in the province or territory where the project is taking place and ensuring GHG emission reductions generated by the project are legally additional as defined in the Protocol.

In most cases, any modifications to a landfill site must be reflected in the landfill site’s operating permit. If, as a result of the voluntary implementation of an offset project, the landfill site’s operating permit is updated to include the modifications related to the project, the GHG emission reductions generated by the project are still considered to be legally additional (i.e. have not occurred as a result of the operating permit). For this to be verified, the proponent must be able to show that the operating permit was updated as a result of the installation and operation of the active LFG recovery system.

Eligible recovery systems

In order for a project to be eligible, the wellfield of an active LFG recovery system must be installed in one or more landfill cells or clearly delineated discrete sections of the landfill site within the project site after January 1, 2017, the earliest start date of a project allowed by the Regulations. A wellfield for active LFG recovery that was installed within the landfill site prior to January 1, 2017, is not eligible for use in generating federal offset credits under the Regulations.

A project can still be undertaken at a landfill site that has a wellfield for active LFG recovery installed prior to January 1, 2017, so long as:

• the project site as defined under the Protocol does not include the wellfield for active LFG recovery installed prior to January 1, 2017.
• the LFG recovered from the project site is measured separately from any LFG recovered from outside the project site.
• the LFG recovered from outside the project site is not destroyed for the purposes of generating federal offset credits.

Other components of an active LFG recovery system installed prior to January 1, 2017, such as blowers, can be used to support the active recovery of LFG for the purposes of the project.

System expansions and upgrades

An active LFG recovery system installed after January 1, 2017, can be expanded or upgraded after project registration and throughout the crediting period, as long as this occurs within the boundaries of the project site.

Expansions or upgrades after January 1, 2017, to a wellfield for active LFG recovery that was installed prior to January 1, 2017, do not make the wellfield eligible for use in a project.

Project start date and crediting period

Establishing the project start date

The start date of a project corresponds to the first day that LFG actively recovered from within the project site is destroyed in an eligible destruction device. Once active recovery and destruction of LFG have started, the project start date cannot be changed due to a pause or break in operation of the active LFG recovery system or destruction device(s); system expansions, upgrades, or efficiency improvements; or registration of a project in Canada’s GHG Offset Credit System that was previously registered in another GHG offset credit system or GHG reduction mechanism.

Crediting period length and renewal

A project undertaken under the Protocol has a crediting period of 10 years which can be renewed two times if the project continues to meet all requirements, for a maximum total crediting period of 30 years.

Project site

Project site area

The project site does not have to be a continuous area. It may correspond to one or more eligible landfill cells or clearly delineated discrete sections of the landfill site; areas of a landfill site where eligible destruction devices are located; and areas of an adjacent facility where eligible destruction devices are located.

Project site boundaries

The proponent must document and report the location and the geographic boundaries of the project site and submit a site plan. The geographic boundary of the project site cannot change after the first reporting period; however, the wellfield for active LFG recovery and eligible destruction devices can be installed or expanded within the project site throughout the crediting period. It may be useful to consider this in establishing the boundaries of the project site for project registration.

Responsibility for LFG

The proponent is responsible for obtaining all data and information from the project site necessary to comply with all requirements, including determining the quantity of GHG emission reductions and ensuring destruction devices meet applicable requirements.

The proponent is responsible for the LFG until the point of destruction, which is considered to be the eligible destruction device. In cases where the LFG is sent to be destroyed at an adjacent facility, the proponent must have access to data and information regarding the destruction of the LFG and the eligible destruction device(s) at the adjacent facility. In cases where the upgraded LFG is injected into a natural gas network, the point of destruction is considered to be the point where the LFG is delivered to the station for injection or the station for compression or liquefaction. The natural gas network itself, beyond these stations, is not considered part of the project site; the proponent is not responsible for the LFG or any data or information past this point.

Uniqueness

To ensure GHG emission reductions from a project undertaken under the Protocol are unique and to avoid double crediting, the GHG emission reductions for which federal offset credits have been issued must not be credited under another offset credit system or another GHG reduction mechanism. In project reports, the proponent must provide a statement that no credits were attributed under another offset credit system or GHG reduction mechanism for the GHG emission reductions generated by the project.

That said, there can be various crediting opportunities for landfill CH₄ emission reductions; find more information on the crediting opportunities under both the Protocol and the Clean Fuel Regulations in a separate guidance available on this current page. 

Quantification methodology

Sources, sinks and reservoirs (SSRs)

The Protocol sets out the quantification methodology for all SSRs that are included in the project GHG boundary for the baseline and project scenarios. Only the identified GHGs for the included SSRs relevant to the specific project activities taking place must be quantified (e.g. SSR 8 to 12 do not need to be quantified if only a flare, SSR 7, is being used in the project).

Oxidation factor

The oxidation of landfill CH₄ occurs when LFG passes through soil or other materials covering the waste which contain methanotrophic organisms that convert the CH₄ to CO₂. Excluding the oxidation of landfill CH₄ from the quantification of baseline scenario GHG emissions results in higher baseline scenario GHG emissions and, subsequently, more GHG emission reductions that can be credited. Claiming a 0% oxidation factor must, therefore, be acceptably and conservatively justified to avoid over-crediting. A 0% oxidation factor can only be used if a geomembrane is covering the entire landfill site area and no CH₄ oxidation technology in place. A geomembrane is a synthetic/polymeric material that is impermeable to liquids and/or gases, preventing the transfer of these substances. Geomembrane covers do not support the establishment of the methanotrophic organisms that oxidize landfill CH₄ in other cover systems.

Quantifying supplemental fuel

Federal offset credits cannot be issued for GHG emission reductions that are already subject to provincial or federal carbon pollution pricing mechanisms; however, although supplemental fossil fuels are covered by carbon pollution pricing, GHG emissions from the use of fossil fuels for the operation of the active LFG recovery system, treatment equipment, and destruction devices in the project scenario (SSR P5 and SSR P6) must be quantified in order to accurately and conservatively quantify the GHG emission reductions generated by the project.

Destruction efficiency values

No destruction device can destroy 100% of the landfill CH₄ delivered to it; some landfill CH₄ will pass through the device undestroyed and be released to the atmosphere in the project scenario. To quantify GHG emission reductions generated by a project, the Protocol’s quantification methodology requires the use of a CH₄ destruction efficiency for each eligible destruction device to calculate the quantity of undestroyed landfill CH₄. The Protocol sets out a default CH₄ destruction efficiency for each type of eligible destruction device that can be used by the proponent. The proponent also has the option to determine a device-specific destruction efficiency if they want to demonstrate their device can achieve a more efficient destruction, resulting in less undestroyed landfill CH₄.

Leakage

While waste could be diverted away from a landfill site due to increased costs or tipping fees resulting from the undertaking of a project, which would cause the landfill CH₄ emissions to be passively released to the atmosphere elsewhere, the high costs associated with collecting and transporting this waste to a farther location are presumed to render this leakage scenario improbable. Leakage was, therefore, determined to not be applicable to this project type and there are no conditions related to leakage in the Protocol.

As a result, and in reference to the variable Ci in the formula in subsection 20(2) of the Regulations (which corresponds to the leakage discount factor), there is no value to be applied for this variable for the quantification of GHG emission reductions generated by a project undertaken under the Protocol.

Reversals and environmental integrity account

Reversals

Since the GHG emission reductions generated by a project undertaken under the Protocol are achieved through an irreversible process of combustion, they are considered permanent with no risk of reversal. Reversal risk management plans and permanence monitoring are, therefore, not applicable for projects undertaken under the Protocol.

Contribution to the environmental integrity account

The environmental integrity account (EIA) consists of a pool of credits acting as a form of insurance for the environmental integrity of Canada’s GHG Offset Credit System. All projects must contribute federal offset credits to the EIA.

The EIA contribution rate for projects undertaken under the Protocol is 3% of the GHG emission reductions generated (after deducting any GHG emission reductions for which the proponent agrees to forego offset credits pertaining to direct financial incentives received for the project, as per subsection 29(2) of the Regulations, as applicable). As a result, the number of federal offset credits issued to the proponent for a reporting period will usually represent approximately 97% of the GHG emission reductions, depending on the result of the rounding.

Guidance: Understanding the interactions between the crediting opportunities under the Landfill Methane Recovery and Destruction federal offset protocol and the Clean Fuel Regulations

In some cases, it may be possible for projects at landfill sites in Canada that recover and destroy landfill gas (LFG) to benefit from crediting opportunities under both the Canadian Greenhouse Gas Offset Credit Regulations (Offset Regulations) through the Landfill Methane Recovery and Destruction federal offset protocol (Protocol), and the Clean Fuel Regulations (CFR).

This guidance provides clarifications on such crediting opportunities under both regulations.

The information contained in this guidance does not in any way supersede or modify the Offset Regulations, the Protocol, or the CFR, or offer any legal advice or interpretation of those regulations or the Protocol. Where there are any inconsistencies between this guidance and the regulations or the Protocol, the regulations or the Protocol take precedence.

The regulations

Canadian Greenhouse Gas Offset Credit Regulations (Offset Regulations)

Under the Offset Regulations, proponents can be issued federal offset credits for undertaking projects that generate greenhouse gas (GHG) emission reductions and removals compared to business-as-usual practices.

The Protocol specifically incentivizes projects that actively recover and destroy LFG, reducing landfill methane (CH₄) emissions instead of allowing them to be passively released to the atmosphere. Federal offset credits can be issued for GHG emission reductions generated from the destruction of landfill CH₄ only, provided that all applicable requirements are met. In particular, the GHG emission reductions generated by an offset project must be unique and only credited under the Offset Regulations. Federal offset credits cannot be issued for GHG emission reductions from fossil fuel displacement with LFG, as such reductions are not eligible under the Offset Regulations.

Clean Fuel Regulations (CFR)

The CFR require gasoline and diesel suppliers to gradually reduce the carbon intensity (CI) of the fuels they produce and import into Canada, for use in Canada. The CFR establish a market of CFR compliance credits, where each CFR compliance credit, created by a registered creator, represents a life cycle emission reduction of one tonne of carbon dioxide equivalent (CO₂e). CFR compliance credits can be created or acquired and then used to comply with the CI reduction requirements under the CFR. Biogas and renewable natural gas (RNG) that are used as fuel have multiple opportunities to create CFR compliance credits, including when they are derived from LFG^{Footnote 1} . For example, this includes biogas used as a fuel to generate heat or electricity, or RNG injected into a natural gas pipeline or used in vehicles. CFR compliance credits are based on the volume of biogas or RNG and the difference between the life cycle CI of the biogas or RNG and the reference CI set out in the CFR, assuming the displacement of natural gas or grid electricity. The Specifications for Fuel LCA Model CI Calculations (the Specifications) include instructions for calculating life cycle CIs of biogas and RNG.

The recovery and use of LFG for biogas or RNG production can also prevent landfill CH₄ emissions that would have occurred if the LFG was instead released to the atmosphere. As a result, landfill CH₄ emission reductions (called avoided emissions from landfill gas management in the Specifications) may be accounted for in the CI of biogas and RNG derived from LFG, if eligibility criteria are met.

Eligibility criteria to account for landfill CH₄ emission reductions in the CI are based on a national baseline scenario established by the CFR. The national baseline scenario is set at the most stringent landfill regulations in Canada, and applies to all landfill sites, regardless of their location. The Specifications outline the associated eligibility criteria to account for landfill CH₄ emission reductions in the CI. For the purpose of the CI calculation, landfill sites that do not meet the eligibility criteria are “considered regulated”; landfill sites that meet the eligibility criteria are “considered not regulated”.

For landfill sites “considered regulated”, the landfill CH₄ emission reductions cannot be accounted for in the CI of the biogas or RNG; CFR compliance credits may be created, but based on a CI that does not account for the landfill CH₄ emission reductions. For landfill sites “considered not regulated”, the landfill CH₄ emission reductions may be accounted for in the CI of the biogas or RNG if eligibility criteria are met. Accounting for landfill CH₄ emission reductions in the CI is optional.

Crediting opportunities

Project activities with opportunity under only one regulation

The CFR provide opportunities to create CFR compliance credits for biogas and RNG imported from landfill sites located outside Canada, provided that all applicable requirements are met. Federal offset credits cannot be generated under the Offset Regulations for projects at landfill sites located outside Canada.

The Offset Regulations provide an opportunity to generate federal offset credits for the destruction of LFG in a flare. CFR compliance credits cannot be created for this activity as the LFG is not being used as a fuel.

Landfill sites “considered regulated” under the CFR

For landfill sites “considered regulated” under the CFR, CFR compliance credits may be created based on a CI that does not account for landfill CH₄ emission reductions (see scenarios 1 and 2 in Table 1 below). Since landfill CH₄ emission reductions cannot be accounted for in the CI of biogas or RNG for these landfill sites, there is no risk of double crediting the same GHG emission reductions under both the CFR and the Offset Regulations.

At landfill sites “considered regulated” under the CFR and with a legal requirement to recover and destroy LFG, landfill CH₄ emission reductions are not eligible to be credited under the Offset Regulations in addition to not being accounted for in the CI of biogas or RNG under the CFR (see scenario 1 in Table 1 below). For these landfill sites, only CFR compliance credits based on a CI that does not account for landfill CH₄ emission reductions can be created.

At landfill sites “considered regulated” under the CFR with no legal requirement to recover and destroy LFG, landfill CH₄ emission reductions may be eligible to be credited under the Offset Regulations (see scenario 2 in Table 1 below). For these landfill sites, CFR compliance credits may also be created based on a CI that does not account for landfill CH₄ emission reductions. The registered creator under the CFR and the proponent under the Offset Regulations may or may not be the same entity.

Landfill sites “considered not regulated” under the CFR

For landfill sites “considered not regulated” under the CFR, there is a direct overlap with the crediting opportunities provided under the Offset Regulations and the CFR in cases where the landfill CH₄ is being destroyed in an eligible destruction device that uses the LFG as fuel (i.e. boilers, turbines, internal combustion engines, natural gas networks). This overlap exists due to the fact that the landfill CH₄ emission reductions may be accounted for in the CI of biogas or RNG from these landfill sites under the CFR.

The GHG emission reductions generated by an offset project must be unique and only be credited under the Offset Regulations. A decision must, therefore, be made on whether to claim the landfill CH₄ emission reductions from such a landfill site under the Offset Regulations (see scenario 3a in Table 1 below) or to account for the landfill CH₄ emission reductions in the CI of biogas or RNG under the CFR (see scenario 3b in Table 1 below) for each offset project reporting period throughout the offset project crediting period. In scenario 3a, CFR compliance credits for biogas or RNG from the landfill site can still be created during a given offset project reporting period provided that the CI of the biogas or RNG does not account for the landfill CH₄ emission reductions being credited under the Offset Regulations.

The regulation under which the landfill CH₄ emission reductions are being claimed can change for each offset project reporting period. To facilitate this toggling between scenarios 3a and 3b and optimize crediting opportunities, the proponent should consider aligning the offset project reporting period with the start/end of a calendar year which would align with typical compliance periods under the CFR. If the landfill CH₄ emission reductions are accounted for in the CI of biogas or RNG under the CFR for a particular offset reporting period, the proponent must still report under the Offset Regulations as offset project reporting periods must be consecutive. In this case, the offset project report would indicate a quantity of zero GHG emission reductions.

For these landfill sites, the registered creator under the CFR and the proponent under the Offset Regulations may or may not be the same entity. In the case they are different entities, the proponent of the offset project must have all agreements with the registered creator to ensure the same landfill CH₄ emission reductions being credited under the Offset Regulations are not being accounted for the in the CI of the biogas or RNG.

If at any time the proponent is found to have claimed the same landfill CH₄ emission reductions under the Offset Regulations that were accounted for (by them or another registered creator) in the CI of biogas or RNG to create CFR compliance credits, actions would be taken under the Offset Regulations depending on the circumstances, including requiring the proponent to submit a corrected project report, requiring the proponent to replace the federal offset credits that were issued and later found to be invalid, or the cancellation of the project.

Table 1: Summary of interactions between crediting opportunities under the Offset Regulations and the CFR

Scenario	Regulatory status of landfill site*	Federal offset credits (landfill CH4 emission reductions)	CFR compliance credits (CI accounts for landfill CH4 emission reductions)	CFR compliance credits (CI does not account for landfill CH4 emission reductions)
1	“Considered regulated” under CFR, and with a legal requirement to recover and destroy LFG	No	No	Yes
2	“Considered regulated” under CFR, and with no legal requirement to recover and destroy LFG	Yes	No	Yes
3a	“Considered not regulated” under CFR, and with no legal requirement to recover and destroy LFG	Yes	No	Yes
3b	“Considered not regulated” under CFR, and with no legal requirement to recover and destroy LFG	No	Yes	No

^* For the purpose of accounting for landfill CH₄ emission reductions in the CI, landfill sites that do not meet the eligibility criteria are “considered regulated”; landfill sites that meet the eligibility criteria are “considered not regulated”.