Carbon Accounting – Everything You Need to Know
July 2021 was the hottest month ever recorded for our planet, according to new global data released on August 13th, 2021 by the NOAA’s National Centers for Environmental Information. Clearly, climate change is making itself known, and scientists are warning that without drastic reduction in greenhouse gas emissions, conditions will only worsen. Whether you are a company, organization, facility, school, city, or state, you can lend a vital helping hand by reducing your greenhouse gas emissions. Carbon accounting is one way to do this.
In this article, we’ll cover what carbon accounting is, the different scopes, and how to get started. We’re also including some helpful resources to aid you on your carbon accounting journey.
What is Carbon Accounting?
Carbon accounting is the process by which organizations measure how much greenhouse gasses they are emitting. This is necessary to understand their climate impact and meet any emissions goals, whether voluntary or government-required.
Carbon Accounting Scopes
Many companies measure and set their emissions reduction goals via a framework of three “scopes.” They are as follows:
This encompasses emissions resulting from the direct activities of your company, e.g., fuel used by facilities and vehicles that your company owns or operates.
These are emissions resulting from the generation of procured electricity you’re your company consumes, e.g., electricity and steam.
This includes the emissions from indirect sources in your company’s supply chain, e.g., purchased raw goods, distribution and transportation, employee commuting, use of sold products and end of life treatment.
If you’re new to carbon accounting, the easiest emissions to measure (and reduce!) are those under scopes one and two. You can reduce scope one emissions via efficiency projects like installing more efficient lighting and HVAC systems or switching to electric or hybrid vehicles. Scope two emissions can be reduced by switching to procuring green energy rather than energy generated using fossil fuels. The last thing to tackle is scope three emissions. These emissions are usually much greater than scope one and two emissions – in most sectors, they make up over 70% of a company’s total emissions. So, in order to meet your emissions reduction target, it’s essential to account for scope three emissions. Scope three emissions are usually more difficult to influence, but some steps you can take include procuring raw goods from sustainable sources, offering employees public transportation vouchers to discourage car use, reducing packaging used on products, making packaging recyclable, and making it easy for consumers to reuse or recycle packaging.
This initiative provides requirements and guidance to countries, cities and companies who want to manage their greenhouse emissions. The GHG Protocol’s emissions accounting standards are the world’s most widely used; in 2016, 92 percent of Fortune 500 companies responding to the CDP (see below) used GHG Protocol directly or indirectly.
- The Corporate Accounting and Reporting Standard provides the framework for companies preparing GHG emissions inventories. It provides the accounting platform for just about every corporate GHG reporting program in the world.
- The Corporate Value Chain (Scope Three) Accounting and Reporting Standard provides the framework for companies also accounting for scope three emissions. This allows companies to identify where in their supply chains to focus reduction activities.
The Consumer Data Platform is an international non-profit organization which provides a disclosure platform to cities and companies wanting to report and manage their environmental impacts. CDP’s corporate climate disclosure platform collects emissions data on all three scopes.
SBTi is a collaboration between the CDP, the United Nations Global Compact, WRI and WWF. It defines and promotes best practices in science-based target setting. If your company is serious about sustainability, you may look to have your scope one, two, and three emissions targets approved by the SBTi.
ACR publishes standards, methodologies, protocols and tools for greenhouse gas (GHG) accounting, which are all based on International Standards Organization (ISO) 14064 and sound scientific practice. ACR only registers project-based carbon offset tons that are real, additional, permanent and independently verified.
The WatchWire platform gives you the knowledge to thoroughly visualize and analyze your emissions data in a cloud-based, centralized platform. WatchWire offers real-time data monitoring so you can see how much energy is being used (i.e., emissions being released) by your buildings/facilities at any given time. In addition, WatchWire can help you measure and verify the effectiveness of your efficiency projects, procure renewable energy, and benchmark all your efforts against national efficiency standards. To learn more about WatchWire’s capabilities, download the WatchWire Fact Sheet.