Legal aspects

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Legal aspects for CMM projects

General aspects

For the implementation of CMM project the local situation of

- the implementation of Kyoto Protocol and

- energy law

has to be explained. These two legal aspects are important for the basic condition of the financial feasibility of projects. The conditions for grid connection and power distribution has to be applicable to CMM projects.


Implementation status of Kyoto Protocol

Although all countries have signed and ratified the Kyoto Protocol, the implementation speed has not been the same everywhere. Priorities vary from country to country and the allocation of resources thus varies as well. A good indicator will be the amount of CMM projects that have actually been realized successfully. However, more important than these official data is the way how Joint Implementation projects are actually handled by the local governments.

 How many JI – projects received a final approval in the specific country

 Are there CMM related projects, that have a letter of approval (LoA)

 Which types of CMM projects have received a LoA

 Are there special types of CMM projects being excluded by local governments

 Are there other reasons for the country to be (temporarily) excluded from UNFCCC procedures

 Are there other rules or regulations in place or in the pipeline that could hinder a JI-approval especially regarding “Additionalty” like guarantieed tariffs for power supply, mandatory methane destruction or penalties, taxes to release CMM into the atmosphere?


Energy politics (preferences for sources of primary energy) and energy laws: Overview on the country´s primary energy mix, present situation and future outlook


 Are there general preferences for future primary energy sources

 What is the actual amount of renewable energy and the target for the future

 Is the power/ fuel production from CMM handled similarly to renewable energy

 Is the access to the public grid regulated, really possible for third parties

 Under which conditions the grid can be assessed, power prices

 How is the power production for the own consumption regulated

As already mentioned above, methane can be a valuable source for energy generation. But when used for this purpose it will have to compete with other energy sources. If energy is widely available and cheap, the margin and the probability of success decrease. The volume of coal mine determines the volume of CMM produced. CMM can be independent of mining but in many cases it will not be, hence the long-term energy politics have a major impact on CMM projects.


Mining and mine safety laws

The local mining and safety laws will have to be observed to evaluate the feasibility of each project.


Capturing and extracting methane can be either hampered or supported depending on legislation; concessions and royalties will have a strong influence on cost and profitability. Licensing is required in all cases and can be either costly, time-consuming or relatively easy to obtain. If the local mining law, for instance, does not permit the use of methane in low concentrations for energy and power generation, some options simply disappear.


Who is the owner of the CMM? In most cases it is the mining company holding the lisence to dig the coal, but for abandoned mines or abandoned parts of mines it could be different.


Mine safety laws and regulations: Description of the regulations, which are important for any kind of CMM-utilisation What are the safety regulations for CMM-utilisation for methane concentrations close to or in the explosive range? Are there prohibited concentration ranges for utilisation? If so, are there possibilities to avoid these restrictions by installing specific additional safety measurements and equipments?


Environmental legislation

This subject is closely related to the implementation of the Kyoto Protocol. Which type of project gets support varies widely. Some countries favour wind, others water or solar energy projects. In theory the environmental laws in all countries should also promote CMM projects as well as all other environmentally beneficial projects, but these projects continuously compete with each other for feasibility, financing and other resources.


 Which environmental laws and regulations have to be considered regarding any kind of CMM-utilisation

 Which kind of CMM-utilisation project requires an environmental impact assessment

 Which authorities other than mine authorities are involved in a CMM project

 What is the expected time to receive all approvals needed

 Are there any specific regulations to protect groundwater, soil and air against CMM activities

 Requirements for transport and distribution of fuels (compressed gas/LNG)


Energy Laws

Actual laws and regulations for energy production, especially injection into the public grid


- Tariffs for power generated through CMM


- Tax deduction for fuels produced from CMM


Tax situation

The local tax situation has to be explained, especially the percentage of corporate profit tax, percentage of VAT, and the issue whether VAT can be recovered by law and in reality, other taxes and customs duties, particularly tax exemptions applicable to CMM projects.

Country aspects

In the following the legal situation of each country is looked at. The structure of this documents is listed below. The whole report comprising information on all countries you can find here: [|Country report].

Versions for specific countries are found below. These reports (status Feb. 2010) include information about:


- Implementation status of Kyoto Protocol

- Energy politics (preferences for sources of primary energy) and energy laws

- Mining and mine safety legislation

- Environmental legislation

- Energy legislation

Under the country name, some important details are listed.

Czech Republic


In the Czech Republic CMM, projects are not accepted as JI-projects by the national focal point. OKD is the only producer of hard coal (bituminous coal) in the Czech Republic. Its coal is mined in the southern part of the Upper-Silesian coal basin – in the Ostrava-Karviná district.

A case studie about CMM projects in the Czech Republic was made by Mader in 2007. Mader coal CCM Utilisation.pdf

In Czech.pdf a summery of important facts for CMM projects is given.


Legal aspects


Mine and mining safety legislation

The necessary laws on safety for underground coal mines are compiled at:  Czech mining laws.pdf

Environmental legislation

Regulations that should be considered in developing CMM projects and other rules and regulations referring to the environment, are presented here  Czech environmental laws.pdf


Energy legislation

Documents that are needed to make a connection to the distribution grid, are presented here  Czech energy laws.pdf

Kazakhstan


Coal mining in Kazakhstan is mainly executed by the company AreclorMittal. In Kazakhstan CDM or JI projects with CMM utilisation are not possible. Kazakhstan is registered in the UNFCCC, but not integrated in the group annex I countries (JI-Countries) neither in the CDM group. So it is not possible to set up an emisson reduction project, that can be approved by UNFCCC. Thus no project is planed or will berealised until March 2012. One pilot project for power production by an IC-engine is in preparation.

The utilisation of CMM is very rare. The price for power is still low and therefore incentives for this project type are still missing. The potential for CMM utilisation exists. Many mines operate a degassing system. The captured methane is vented to the air.

More information you find in Kasakhstan legal aspects. The information in the document was not updated after 2009. For your planning check the current status.

For special details on environmental legislation see Kasakhstan enviroment laws

For special information on energy lagislation see Energy laws

For special information on mining safety legislation see mining safety

Poland


Energy politicy

To increase the share of renewable energy is an important target of Polish politicy. Poland legal aspects


In Poland the structure of energy sources is dominated by coal. So coal is the dominant fuel, accounting for 60.5% of primary energy demand, followed by oil and gas. Unfortunately a trend is emerging towards local production being reduced and the amount of imported coal being increased. Locally produced coal will not be able to compete with imported coal from Australia and South Africa. More information about the energy politics in Poland, especially the strategic goals to reduce power consumption are described in  Poland energy politics.pdf

In the following more information is found on this topic: Poland energy law and Poland environmental laws.


General information about Poland may be retrievedin the chapter: country information Poland

Romania


Legal aspects An overview on the legal aspects in Romania are found in  Romania legal aspects.pdf

Legislation

To create a new electricity producing facility in Romania, interested firms must fulfill certain requirements and obtain a number of documents and authorizations from the institutions and the local authorities authorized to provide them. The necessary legal basis for electricity production with the related conditions and some facts about Romgaz is described here Romania laws.pdf

Environmental legislation

In the following pdf document, you are provided with information about which environmental laws and regulations have to be considered regarding any kind of CMM-Utilisation Romania environmental laws.pdf

Energy legislation

Information on energy laws you will find in  Romania energy laws.pdf

Russia


Legal aspects

Mining and mine safety laws

Basic laws on mining and mine safety are presented here  Russia mining and safety laws.pdf

Environmental laws

Laws concerning the environment, like the ‘On protection of environment’, that regulates the relationship in the field of interaction of society and nature arising from industrial and other activities that have an influence on the natural environment within the limits of Russian territory, and on the continental shelf and other regulation concerning the environment and economic regulation in the sphere of environment protection are presented here  Russia environmental laws.pdf

Legislation related to the environment such as the law on environmental protection, governing the relationship between society and nature in the field of industrial and other activities that effect the natural environment on Russian territory and on the continental shelf, and other rules as well as other regulations on the environment as well as economic regulations in the field of environmental protection are presented here:

Energy laws

Information on tariffs for heat and electric power supply and the legislative regulation for energy production is found here Russia energy laws.pdf

Ukraine


Energy politicy

Ukraine is important to the global energy markets as a central transit centre for exports of Russian oil and natural gas to Europe, as well as a significant energy consumer. Ukraine is a big emitter, especially of methane, which is a result of coal mining. For more information on energy politics, including the production and consumption of fossil fuels, energy consumption and production, the development of alternative and renewable energy sources, experiences and opportunities in methane projects, see  Ukraine energy politics.pdf

Legal aspects

Additional information about

- Enviromental legislation  Ukraine environmental laws.pdf

- energy law  Ukraine energy laws.pdf

- mining law  Ukraine mining laws.pdf

- implementation of Kyoto Protocol  Ukraine implementation kyoto protocol.pdf

- other legal aspects  Ukraine legal aspects.pdf

United Kingdom


Legal aspects

Information on mining and mine safety laws in the UK, aiming at CMM, like the CMM exploration and production licensing and also petroleum legislation relevant to CMM operations and also environmental laws are presented here  UK legal aspects.pdf

CMM mining in the UK

Coal mine methane or mine gas has been used in the UK for more than 100 years as fuel for lighting or to heat pithead baths and offices. In the 19th and early 20th century it was known as firedamp, an explosive mixture of air and methane, which caused many mine accidents with accompanying loss of many miners’ lives up until the mid 20th century. Mine safety became very important. The result was a significant reduction in firedamp and other mine accidents and fatalities. More information about the development of CMM utilization in the UK and the barriers to development you will find here UK CMM mining and barriers.pdf

Germany



Information about mining laws are available at Mining authority in North-Rhine-Westfalia only German language.