Demystifying Your Carbon Inventory

In the lead up to the UN Climate Change Convention (COP26), which aims to accelerate action towards the goals of the Paris Agreement and the UN Framework Convention on Climate Change, our Senior Environmental Consultant, Michelle Bales blogs here about how companies can start to get to grips with measuring their carbon footprint.

Michelle Bales
Written by:

Michelle Bales

The Climate Change Act (2008), as amended in 2019, commits the UK to ‘net zero’ carbon dioxide emissions by 2050. Most industries will need to aim towards net zero by balancing emissions of carbon dioxide with its removal (often through carbon offsetting).

In 2019, the UK became the first major economy to pass a net zero law to end its contribution to climate change by 2050. Net zero will require all sectors of the UK economy to deliver substantial emissions reductions. In alignment with this and the government’s plan to build back greener, in June 2021, the UK government stated that in order to bid for major government contracts, suppliers will have to publish plans to reduce carbon emissions. This will inevitably trigger more companies to think about their own carbon footprint and their own supply chain.

However, at the moment, only one in ten of over a thousand firms surveyed by the British Chambers of Commerce are currently measuring their carbon footprint, and only 26% of larger firms (with more than 50 employees) are measuring theirs.  Lack of in-house knowledge, resources, and lack of funding are the main obstacles faced by firms when tackling their carbon inventory.

What do I need to do to create a carbon reduction plan?

When creating a carbon reduction plan, the main steps to take include:

  • Determine your scope and boundaries;
  • Measure your carbon footprint and create a monitoring plan- this needs to be done using a recognised methodology;
  • Create a carbon reduction plan; and,
  • Declare/validate- this can be a self-declaration or external verification through schemes such as PAS 2060 (carbon neutrality standard), ISO14064-1 (carbon inventory standard) or Science Based Targets. It is important to ensure that the verifying body is accredited.

Many organisations do not know where to start when looking at their carbon footprint, or what they need to include. Here is a summary of how to tackle the task.

Calculating Your Carbon Footprint

First, what is meant by the term ‘carbon footprint’? This doesn’t just include carbon dioxide but also includes the varying global warming potentials (GWP) of other greenhouse gases. GWP is a measure of how much energy the emission of 1 ton of gas will absorb over a period of time relative to 1 ton of carbon dioxide. This provides a common unit of measurement, generally CO2e.

A useful place to start is an inventory of your greenhouse gas emissions. The Greenhouse Gas Protocol has established a comprehensive global standardised framework to measure and manage greenhouse gas (GHG) emissions. You have probably heard the term ‘scopes’ when reading up about this. Scope 1 refers to direct emissions from owned or controlled sources. Scope 2 accounts for indirect GHG emissions consumed by the reporting company from the generation of purchased electricity, steam, heating and cooling. Scope 3 refers to all other indirect GHG emissions that occur in a company’s value chain, including the generation of purchased energy, emissions from waste, travel, and purchased goods or services.

Once you have your measurements from your products and services you can then calculate your footprint. This is done using a simple calculation:

GHG emissions = activity data x emission conversion factor

We are very lucky in the UK as DEFRA produce a comprehensive list of conversion factors and guidance annually. It even breaks down scope 1, 2 and 3 into different coloured tabs to help you divide this up.

Where many companies struggle on this journey, is the quality of their data. But this is always something can be improved, so do not let it put you off!

Tackling carbon reporting can be a daunting task. Our Carbon Advisory Team can help you to create a comprehensive carbon inventory and talk you through methodologies that will enable you to monitor and report on this. We can also help you set objectives and targets to manage and reduce your impact.

Useful links

UK Emissions Trading Scheme (UKETS)

Energy Savings Opportunity Scheme (ESOS)

Greenhouse Gas Protocol

Comprehensive government conversion factors for company reporting of greenhouse gases.