Get on a path to low carbon!

High carbon emissions equate to high risk and lead to a competitive disadvantage in the marketplace and low profits.

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Greenhouse gas reductions of at least 80% are needed globally to have a chance of keeping the increase in average global temperatures to less than 2°C from pre-industrial levels and so avoiding the most dangerous impacts of climate change.

Blockquote-right Intergovernmental Panel on Climate Change
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If emissions are not cut adequately, climate change could reduce annual world GDP by 5% to 20% in the long term.

Blockquote-right Stern Review on the Economics of Climate Change

Successful mitigation of carbon risk comes from avoiding carbon risk where you can; reducing your footprint by innovating, fairly sharing risk with others, and better understanding any residual risk you retain.

What reduction level should I target? How do I mitigate my carbon risk? How quickly should I act? What can I hope to achieve in the short-term?

Reduce 10% Now Plan on 30% Think 80%

Experience has shown that most organizations achieve a 10% reduction in their carbon emissions relatively quickly after they start measuring and monitoring.

The key is to start measuring your carbon emissions. It is true what they say: measuring is managing. Developing an overall carbon footprint for your organization will help you understand where your big contributors, your “hot spots” are. In practice many organizations find that it is helpful to focus early on electricity consumption, on-site fossil fuel use, transportation fuel use, air travel, and primary materials (for products). These five sources are likely to be significant contributors to your organization's overall carbon footprint.

  1. ELECTRICITY. This includes all electricity sourced from the national grid. Your electricity bills should provide sufficient consumption detail. If not, your electricity supplier should be able to provide accurate records. In some cases, electricity costs may be bundled into your building lease and you may need to work with your landlord to develop an estimate based on square footage.
  2. ON-SITE FOSSIL FUEL USE. Many businesses will use fossil fuel energy to run specific processes involved in making a product. Restaurants typically use natural gas in their kitchens, for example. Your fuel supplier energy bills should provide sufficient consumption detail.
  3. TRANSPORTATION FUEL USE. This applies to transportation services, either owned or provided, that your organization uses in its business. You will probably have good records of your fuel expense and can use average cost/litre or cost/gallon figures to estimate your consumption.
  4. AIR TRAVEL. For air travel, it is best to total the miles of all trips. If you don't know the individual trip distances, total the number of flights in three categories: short, medium length and long haul, and multiply by a typical distance for each category.
  5. PRIMARY MATERIALS (PRODUCTS). The carbon emissions embodied in materials used to make products can be a very significant contributor to your footprint. Even if materials are sourced from other suppliers, it is important to break your product down into its chief components and understand the carbon emissions from each piece. You may need to work with your suppliers and you can also use the emissions factors available in footprinter for a wide variety of materials.

We recommend getting on a reduction path. Working backwards from the 2050 target of 80% global reductions, implies a reduction of 30% by 2020 (chart).

80-20-chart

Carbon policy in developed countries is guided by the scientific consensus that we must reduce greenhouse gas emissions by 80% by 2050 to stabilize the global climate. While different governments respond with different speeds in developing and implementing policy, the timetable does not change. Slower reductions will drive the eventual market cost of carbon well above current price predictions.

Carbon Regulation in the UK:
  • Under the Kyoto/Burden Sharing Agreement, the UK is required to cut greenhouse gas emissions by 12.5% by 2012 versus 1990 base year.
  • The Climate Change Act 2008 goes beyond this to set a legally binding target of an 80% reduction in greenhouse gas emissions from 1990-2050.
  • An interim target has been set of a 34% reduction from 1990-2020 and this will be increased to 42% if significant international agreement is secured.
  • The Government published a Low Carbon Transition Plan in July 2009 with over 40 major policies to help achieve reductions.
  • The Carbon Reduction Commitment (CRC) announced in May 2007, aims to reduce carbon emissions in large non-energy-intensive organizations by 1.2 million tonnes per year by 2020. This is estimated to affect up to 5,000 large organizations.
Carbon Regulation in the US:
  • The U.S. Congress passed a historic climate and energy bill in June 2009. The bill creates a renewable electricity standard for electric utilities and puts a cap on emissions of greenhouse gases covering 85% of the overall U.S. economy.
  • Emissions cuts are to start in 2012 and the cap-and-trade program would be completely phased in by 2016.
  • The goals for U.S. emissions reductions against 2005 levels are:
    • 3% cut by 2012
    • 17% cut by 2020
    • 42% cut by 2030
    • more than 80% cut by 2050.

Not all carbon emissions can be dealt with the same way. A lot will depend on the magnitude of the emissions, how much control you effectively have over them, how cost effective solutions are, and what other alternatives you have.

In general you can mitigate your carbon risk in 5 ways:

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  1. AVOID. Avoid greenhouse gas emissions where you can. This usually occurs when you have a very high degree of control.
    • Products company - Eliminate a paper book manual that is normally shipped with the product (use a website instead).
    • Landscaping company - Eliminate the use of leaf blowers in favor of rakes and brooms.
  2. REDUCE. You can reduce emissions by light-weighting, recycling and re-using materials and downsizing services.
    • Grocery store - Limit the size of the cold beer aisle. Stock "warm beer" for customers that aren't going to consume immediately.
    • Only use couriers for documents that can't be sent over the internet.
  3. REPLACE. Many materials or services can be directly or easily substituted with low-carbon alternatives.
    • Building project - Change the spec on concrete to low-carbon.
    • Winery - shift to light weight glass bottles.
  4. SHARE. If you do not directly own the emissions you may be able to share improvements with the owner. This occurs with landlords and in situations of sole sourcing where you have a considerable degree of influence.
    • Office building - share the investment in zone-based HVAC controls with landlord.
    • Products company - share the cost of fuel efficiency upgrades with truck transportation provider.
  5. RETAIN and OFFSET. In cases where you have little influence over a supplier, or you own the emissions but it is not cost effective to upgrade equipment or otherwise reduce the emissions, you should offset these emissions in the carbon market.
    • Offset emissions from a plant process that is not very cost effective to upgrade.
    • Offset the emissions from necessary business air travel.