13 April 2011 | Luca Del Buono
Carbon, Climate Change, Energy

 

Deciding to cut your company’s carbon emissions does not have to be a decision made only on a moral basis because cutting carbon also slashes your energy bills and saves money whilst enhancing your business’ reputation.

This guide will show you how you can measure your business’ environmental impact through “carbon footprinting”. The business sector has been innovating techniques for keeping track of incomings and outgoings for centuries. Now businesses are also using carbon footprinting to keep track of their direct and indirect greenhouse gas emissions. This information can then be used to reduce costs and grow sustainably.



What is a carbon footprint?

A carbon footprint is a measurement of total greenhouse gas emissions caused directly or indirectly by individuals, organisations, events or products. The Kyoto Protocol defines the greenhouse gases (GHG) as Carbon Dioxide (CO2), Methane (CH4), Nitrous Oxide (N2O), Hydrofluorocarbons (HFCs), Perfluorocarbons (PFCs) and Sulphur hexafluoride (SF6). They are measured in a unit called tonnes of carbon dioxide equivalent (tCO2e), which allows the different gases to be compared like-for-like relative to CO2.


Calculating your carbon footprint

There are competing methodologies for calculating carbon footprints. Large businesses tend to hire consultants or companies to do their carbon footprinting but small and medium sized enterprises (SME’s), with a little time and effort, can calculate their own. One non-profit organisation, The Carbon Trust, offers this service through an online calculator.

The Carbon Trust separates a business’ greenhouse gas emissions into three scopes based on the Greenhouse Gas Protocol:

• Scope 1 - Direct emissions resulting from activities within the organisation's control. Includes on-site fuel combustion, manufacturing and process emissions, refrigerant losses and company vehicles.

• Scope 2 - Indirect emissions from electricity, heat or steam purchased and used by the organisation.

• Scope 3 - Any other indirect emissions from sources not directly controlled by the organisation. Examples include: employee business travel, outsourced transportation, waste disposal, water usage and employee commuting.

The more extensive the footprinting scope, the greater the potential for reductions in fuel costs. For example, monitoring the supply chain and manufacturing as specified in Scope 1 might lead to selecting lightweight or low-carbon packaging which may have the benefit of reducing packaging costs and the amount required, as well as cutting distribution and fulfilment costs. A further reduction could be made, using Scope 2, by calculating electricity use for facilities then decreasing electricity use or wastage. The GHG Protocol requires all organisation footprints to include scopes 1 and 2 but 3 is more flexible and you may wish to include certain elements but not others depending on your environmental and commercial goals. By broadening into the third scope, you can prioritise reduce emissions in even more areas that might result in other cost savings.


The Process

The Carbon Trust uses a six-step process for calculating an organisation’s basic carbon footprint including the main emissions sources. For complete accuracy, the process can be very complex and as a result require outside consultants or specialist environmental managers.

Step 1

Decide on a method for measurement and be consistent to ensure accuracy. If a team of you are collecting data, it is essential that every member of the team is using the same standards.
The GHG Protocol previously mentioned is one method you could use but not the only one. There is also ISO 14064 for example.

Step 2

Define the organisational and operational boundaries so it is explicitly clear what will be included in your footprint. Things to bear in mind are whether you will include subsidiaries, joint ventures or leased assets.

You should include all emissions from activities under your control. All scope 1 and 2 emissions should be included but scope 3 emissions are more flexible.

It is important to consider any relevant legislative requirements such as those required through the UK Carbon Reduction Commitment (CRC) or EU Emissions Trading Scheme (ETS). You must include all emissions that fall under these regulations to ensure compliance, as well as considering what is required if you wish to be third party certified.

Examples of companies, institutions and organisations that have had their carbon footprints verified: • Aviva • University of Manchester • Corus UK • Lancashire Fire and Rescue Service • Branston • Hilton International Hotels • North Wales NHS Trust • Merseyside Police • Pavestone UK • The National Gallery • Tesco • British Airways • Big Yellow Group • GlaxoSmithKline

 

 

 

 

 

 

 

 

 

 

 

Step 3

Collect the data. In order to ensure an accurate footprint, it is vital you take into account all the possible emissions sources in the boundaries you defined in step 2.
 
Collate data on gas and electricity use in kilowatt hours (kWh), just as it is displayed on your meters and bills. For other fuel data, the units can also be kWh but perhaps fuel oil, for example might be litres and some measurements in megajoules (MJ). Details like location are also important because in some areas more carbon heavy power sources are used than in others.

For transportation you need to not only take note of amounts used but the type of fuel because different liquid fuels have different levels of GHG emissions. Don’t worry if you have not been collecting this information accurately, mileage and the fuel economy of vehicles is an acceptable substitute. Wherever such assumptions are made or gaps have been left, make sure to keep a record of these so they can be taken into account.
 
Step 4

Convert the data into tCO2e by multiplying the data you have collected by standard emissions factors (these can be found here) but there are calculators available online, such as The Carbon Trust’s, that can handle this task for you.

Some of these calculators will help you get a perspective of your footprint by comparing it to the national and global averages.



This is the end of the compulsory steps you need to take when calculating your organisation’s carbon footprint – you can start making reductions based on what you have learnt but it does not have to be the end. The next two steps are optional but in some ways the most important if you want your efforts to be recognised by your staff, customers and regulators.



Step 5

Verify the results by getting a third party to examine your efforts and certify that your carbon footprint is accurate. Certification gives you peace of mind that your data is correct but most importantly it provides credibility and confidence when you communicate your carbon footprint to the public.

Step 6

Verify the emissions reductions that you have implemented. As with step 5, this is done through a third party and adds credibility and confidence to any claims of reductions you may now make to the public.



Once you have significantly reduced your CO2 emissions, businesses can employ marketing strategies to communicate a message of corporate social responsibility to consumers and investors looking to buy and invest 'green'. Businesses improve relations with all stakeholders by demonstrating the increased transparency of their environmental data. By comparing their footprint with prior footprint calculations or competitor data, an organisation can demonstrate a competitive advantage.

Businesses may choose to offset the remaining unavoidable emissions by investing in sequestration projects for the equivalent offset amount in tonnes of emissions, but this should only happen once significant efforts to reduce emissions have taken place, not in the first instance. Ensure that carbon-offset credits are from reputable organisations or projects – contributing to carbon sequestration projects such as renewable energy projects, renewable agriculture and afforestation.

 

For further information:

The Carbon Trust

 

Images

Front page: A_of_DooM | Flickr

Carbon: p.Gordon | Flickr

Electricity meter: Kai Hendry | Flickr

Tree planting: treesftf | Flickr

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