Meeting the challenge of climate change - managing carbon in the corporate and public sectors
Businesses can no longer afford to delay meeting the challenge of climate change. The last few years have seen a shift in perception to one where climate change is now seen as a key challenge facing private and public sector organisations. This is partly due to more informed communications on the scientific consensus of climate change and the economic analysis of its impacts such as those set out in the UK government?s Stern report. Consumer perception about climate change and the ethical responsibility of business has also evolved. For corporations that meet this challenge early there are many opportunities for commercial advantage, through either product or service differentiation and a reduction in risk exposure.
For those organisations that still haven?t moved on the issue, governments are now starting to take the initiative. Over the next few years, the EU ETS (Emission Trading Scheme) will be expanded to include aviation. Cap and trade schemes involving over 4,000 organisations will be introduced in the UK through the Carbon Reduction Commitment (CRC). California has proposed a Californian cap and trade programme in the US and Australia has set up the Carbon Pollution Reduction Scheme. These initiatives will impact the way organisations across the private and public sectors operate and deliver their services.
It has now become imperative for organisations to have a robust strategic approach to carbon management. For energy intensive organisations with a large carbon exposure, emissions management is a core part of their business and should be managed as such. However, legislative changes mean that for any company operating in today?s environment, emissions management is becoming an essential component of conducting day-to-day business. Companies formulating a carbon strategy should approach this task with the rigour and criticality of any other core business review. The process must be carefully planned, with senior management engagement to provide the necessary support and decisionmaking capability across the business. Knowledge of carbon accounting and reporting requirements is a key input to developing the carbon strategy.
The first step in developing a carbon strategy is to baseline the current carbon position. This is essential for setting realistic company targets and goals and highlighting potential risks and exposures. There are many possible complications and pitfalls for companies attempting to determine their carbon footprint for the first time. These problems can be defined in three key areas: defining the scope of the organisation and emission types to include collecting relevant data and using that data to calculate an accurate carbon footprint.
There is also a great deal of variation on what companies choose to include within the scope of their carbon footprint. Organisations are often unsure about the level of detail required and the organisational boundaries of their footprint. For example, should every location be included? What about business travel? Should the organisation?s supply chain be captured? What needs to be included to meet basic legislative requirements? How will data be stored to enable annual comparisons to be made? These types of questions are crucial to calculating an accurate and meaningful carbon footprint based on the strategic objectives of an organisation.
Once the scope has been determined, the next step is data collection. This stage will identify what data is required, whether it is being collected currently within the organisation, where it is stored and how to transform it into a useable form. The very nature of carbon footprinting means that this will typically involve all parts of the organisation. Getting the basic data collection process right for the baseline calculation will help establish a good foundation for future calculations and ensure the required internal and external stakeholder relationships exist to help data flow through the organisation. When the data is collected, carbon calculations should be made based on recognised methodologies.
There is still considerable flexibility surrounding the methodologies used to calculate a corporate carbon footprint. The most common methodology used is the GHG (Greenhouse Gas) Protocol developed by the World Resources Institute and the World Business Council for Sustainable Development but there are others, such as DEFRA in the UK, which are more country specific. The key thing to note is that a consistent methodology should be used to calculate the carbon footprint to enable effective annual comparisons to be made.
Calculating a carbon footprint based on the collected data can be very time consuming, especially if large sets of data try to be processed using simple spreadsheet tools. By using a specific carbon management tool, time can be saved and the likelihood of an accurate carbon calculation is significantly increased. An effective and meaningful carbon strategy will require more than simply a one-off audit of an organisation?s carbon footprint. To see progress, identify trends, set goals and identify future risks and exposure, organisations need to be able to view their emissions over time. This can prove to be difficult if an appropriate tool is not used to calculate the emissions and store the data in a single source.
To participate in the newly emerging cap and trade markets, organisations will need even more information at their fingerprints ? similar to that used in financial records. This will include the ability to:
Greenstone is a specialist carbon solutions company accredited by the Carbon Trust to provide carbon management strategies and solutions. Greenstone works in partnership with major commercial and public sector organisations to measure, manage and reduce their carbon emissions. Greenstone?s solutions comprise both consulting advice and access to a suite of carbon management tools. They help their clients through the challenges described above by following a simple three-step process:
Central to Greenstone?s proposition is their unique Acco2unt software which provides organisations with a robust carbon management and accounting solution. It enables organisations to measure, manage, plan, store and report emission data and track performance on their carbon footprint at multiple organisational levels. An extensive list of emission sources are included in the calculation covering energy, travel and transport, together with waste and water consumption.
Greenstone?s extensive CO2 knowledge database applies the latest climate change impact factors to the carbon calculation according to national and international protocols, eg Defra and GHG Greenstone?s Carbon Consultants work with clients to develop strategies to help organisations manage their climate change risks and opportunities, balancing these in a commercial context. They provide expertise in sustainable carbon reduction solutions and objective independent advice on credible carbon offset projects.
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Added the 10 September 2008 in category Innovation UK Vol4-1