At the moment in Australia and the US there is currently little real incentive for any organization to manage or understand its overall carbon footprint, except if it is physically emitting global warming gases and comes under Scope 1 emissions or is a large energy user and falls under Scope 2 emissions.
Scope 1 Emissions are direct emissions from within the organization and needs to be reported if it exceeds the threshold, in the US the EPA has set this threshold at 25,000 T CO2 equivalents per year. Examples of scope 1 include electricity generation, industrial processes, fuel usage for transporting good, fugitive emissions, on-site waste.
Scope 2 Emissions are indirect emissions from purchased electricity and again is only reported if over the threshold.
Scope 3 are emissions embedded in inputs and includes waste disposal, purchased materials, business travel, fuel usage for transporting of outputs and outsourced activities. At the moment reporting of Scope 3 is voluntary only.
Managers of organizations outside of those parameters (and some large emitters can sit just outside these parameters) can quite rightly say that they will wait for further clarification from Governments.
However, those that take practical steps now will be the organizations that will have developed long term, sustainable strategies to survive a more intense and accountable version of the various Emission Trading Schemes (ETS) / Carbon Taxes about to be introduced, or being introduced by, Governments around the world. The ETS will ultimately develop a requirement to manage lower levels of emissions under Scope 2 emissions and the incorporation of Scope 3 emissions into the emission management structure. Currently Scope 1 and 2 emissions have been clearly defined while Scope 3 emissions have not.
Why Undertake an Emission Accounting Exercise?
Just as organizations account for their expenses, so too should they account for their carbon emissions and hence the eventual additional emission costs (i.e. carbon taxes) they pay. Also there is a direct link between energy use and expense, so a reduction in energy use will result in a reduction in emissions and a reduction in costs. But there are other reasons as well. For organizations a sound emission calculation model allows them to:
- Comply with EPA requirements if organizations fall into the >25,000 T CO2e category.
- Monitor and understand energy consumption and emissions.
- Define the boundaries of corporate responsibility. That is, an emissions model “ropes-off” those areas of the organization whose emissions are not its responsibility – thereby minimizing the cost.
- Open new paths for staff buy-in of cost cutting measures through targeted energy reduction steps.
- Prepare staff for the time when Scope 1 and other large emitters start to look at passing their carbon emissions to others via increased costs.
- Help identify the carbon footprint of courses and individual subjects. Course or Subjects with a high concentration of carbon inputs may become less viable. Research and Development needs direction to find the best carbon outcome as well as the best return.
- Set an example and expectation for suppliers to do the same.
- Enhance the organizations public profile.
- Build a valuable knowledge-base to help measure and justify future corporate environmental and financial decisions.
How to Proceed
Now that we understand why there is a need to determine an auditable carbon footprint and emissions profile, we need to go through a systematic approach to implementing the model.
Undertaking an emissions calculation/reduction program requires a number of strategic steps.
- Development of a company-wide policy and commitment to manage emissions and reduce energy consumption agreed at the Senior Management levels.
- Development of a behavior change program in parallel with the gathering of data on a pilot program.
- Engagement of an experienced environmental consultant to provide access to the appropriate emissions data sets.
- Development of baseline data such that it is easy to track changes to the baseline into the future.
- Identification of corporate datasets, such as financial and asset records that would form the cornerstone of data to which all emission calculations must reconcile.
With the strategic goals in place, as well as a clear commitment from senior management, the first steps in establishing a model to measure the emissions profile can begin.