A Comprehensive Guide to Carbon Reporting
It sounds too simple to be true, and that’s because it sort of is.
Reporting upon your carbon emissions is a complex task and it can be difficult to find all the information you need.
That’s why we’ve collated all the info you need to know about carbon reporting, giving you a comprehensive guide to handling your emissions.
And once you've got the hang of those, learn how to:
Greenhouse Gas Accounting
Greenhouse gas or GHG accounting is the way to audit and inventory greenhouse gas emissions. This can be used to measure individual, or most commonly, organisational GHG emissions.
You may have heard the term Carbon Footprint, referring to an organization’s greenhouse inventory. The name can be misleading, as a carbon footprint is not, in fact, limited to carbon emissions. Instead, it can encompass a variety of greenhouse gases (GHGs), evaluating their collective warming impact.
These GHGs can be expressed in terms of CO2 by using CO2-equivalents (CO2e), based on their relative global warming potential (GWP).
A full organisational GHG emissions assessment takes into account the greenhouse gases produced directly and indirectly from the organisation’s activities.
This forms the carbon footprint of the organisation and includes scope one, two and three emissions. More on those later…
For now, let’s get you started on the basic frameworks you need to know to handle your emissions.
GHG Protocol - The Most Widely Used Standard
GHG Protocol supplies the world’s most widely used greenhouse gas (GHG) accounting standards. These are globally standardized frameworks for measuring and managing GHG emissions for private and public organisations.
The Corporate Standard’s first edition was published in 2001 and has been updated since with additional guidance.
The standard covers the reporting of seven types of greenhouse gases covered by the Kyoto Protocol including:
- Carbon Dioxide (CO2)
- Methane (CH4)
- Nitrous Oxide (N2O)
- Hydrofluorocarbons (includes HCFCs and HFCs)
- Perfluorocarbons (PFCs)
- Sulphur Hexafluoride (SF6), and
- Nitrogen Trifluoride (NF3)
You’re probably thinking, another acronym to remember… and this one has numbers?!
Let’s break it down:
ISO = International Organization for Standardization
ISO 14064 is one of the standards in a series of International Standards for environmental management. It specifies principles and requirements that provide a framework for GHG accounting and verification for organisations.
ISO 14064 has 3 parts, and according to their website, each serves a “unique intent”. You can find out more about these parts here, but for your convenience we’ve briefly covered each below.
This deals with the quantification and reporting of GHG emissions of an organisation. It covers the development, maintenance and reporting of an organisation’s GHG inventory.
This deals with quantification, monitoring and reporting of GHG emissions and reduction efforts of projects intending to reduce GHG emissions. It covers project planning, monitoring, quantifying and documenting project performance and managing the quality of data.
This deals with the validation and verification of GHG claims, guiding those managing these processes. This covers both organisational and project emission quantification, monitoring and reporting
ISO 14064 does not compete with the GHG protocol but is intended to support and build upon the standard’s existing work. It is shorter and more direct.
Think of it this way, ISO 14064 identifies WHAT to do. GHG Protocol explains HOW to do it.
Different Types of Emissions
The two frameworks place different types of emissions into different scopes or categories. GHG Protocol uses scopes 1, 2 and 3, while ISO14064 uses Categories 1 through 6.
This image shows examples of emissions that fall under the different scopes and categories.
Ministry for the Environment – Measuring Emissions: A Guide for Organisations (2020)
Here we’ll focus on Scope 1, 2 and 3. Until you get down into specifics, these are the easiest to wrap your head around when it comes to categorizing (and understanding) your GHG emissions.
Scope One and Two Emissions:
Scope one and two cover the operations and energy usage for an organisation’s owned operations. This is what you likely consider when you think of your carbon footprint and includes industrial processes, heating, travel and other direct activities.
This is a great place to start, as the responsibility for change falls upon your organisation and your organisation only.
These emissions derive from the supply chain, including any purchase of products and services that your organisation might use.
Reducing these emissions requires action from other organisations in the supply chain, which makes it more difficult to reduce than scope one or two. It requires a good understanding of your supply chain as well as needing action from those within it.
So... What exactly SHOULD I do? How should I do it?
Preparing Your Inventory
Selecting a Base Year and Measurement Period
Things change over time, and so will your organisation’s emissions profile.
Having consistent and insightful comparisons requires the selection of a base year.
This involves choosing a year from which your emissions data is available and specifying why that year was chosen. Make sure that this year is consistent with your measurement period, for example, the calendar or financial year.
If this is your first-year reporting, you can use it as your base year for measuring change in years to come.
Determining Your Organisation’s Boundaries
What will you be including in your GHG profile?
Organisations vary so much in structure that it’s hard to answer that question for you. But here are two distinct approaches used to establish GHG emissions for corporate reporting.
Equity Share Approach
Under this approach, an organisation is accountable for GHG emissions of operations according to its share of equity in the operation (often by ownership %). This represents the rights to economic risk and rewards from an operation.
Under this approach, an organisation is accountable for 100% of the GHG emissions from operations it controls. However, it does not include emissions from operations it owns an interest in but has no control over.
NOTE: If your organisation wholly owns all its operations, the organisation’s boundary will be the same regardless of the approach taken. You can use either approach under the GHG Protocol, so long as you remain consistent.
Identifying Your GHG Emissions
The first step is to identify your emission sources within your organisation’s boundaries. The different scopes can prove useful as an initial guide to identify significant GHG emission sources.
Scope three emission reporting is an optional step, but we highly recommend it, as it helps you know the impact of the products and services you are sourcing and asserts your organisation as a climate leader.
Select Your Calculation Approach and Collect Activity Data
There are a variety of ways to calculate your GHG emissions. In fact, the IPCC guidelines (IPCC, 1996) have a whole hierarchy of different approaches and techniques.
One of these ways is through usage data, although this can be cost-prohibitive and time-intensive. While simple data can be obtained through usage data it takes a little more to understand your organisation’s whole impact.
Using a carbon management software like e-Bench® helps you curate accurate, valuable data to make your reporting processes easy.
Reporting on Your Inventory
A full, insightful GHG report should give context to the organisation’s GHG inventory. This includes information about the organisation, annual comparisons, discussion of significant changes and statements of exclusions, methods and references for the calculation.<