Accounting for carbon emissions

Kevin MisselbrookCustomer Services Director,

Access Accounting Ltd

Why is the Green Agenda important to my business ?

• Cost-saving efficiencies• CSR• Compliance• Business sustainability

Cost-Saving

• Higher cost of carbon usage• Tax burden• You can’t manage what you can’t measure • Good measurement highlights awareness

throughout the organisation

CSR

• Corporate and Social Responsibility• CSR reporting requirements• Customer attraction• Suppliers• Investor awareness • and ….

• Will day slide ?

Moral duty ? Moral duty ?

Stern Review•Overwhelming evidence of climate change•Impact : loss of between 5% - 20% of GDP each year !•Cost of controlling – as little as 1% of GDP

“The costs of stabilising the climate are significant but manageable; delay would be dangerous and much more costly”

Supply Chain Pressure

Compliance• Climate Change Bill

– “Cascade” effect on supply chain

• Climate Change Levy• Carbon Trading Schemes (expanding)• ISO 14001

– Environmental standard for businesses– ISO140064 – Carbon Reporting

Compliance• More legislation ? • Dept of Energy & Climate Change – (Oct 08)• Audit standards – Carbon Trust, IAASB• Government standard to be provided by Oct

2009• Companies Act changing by 2012 – mandatory

reporting

Sustainability

• Need to have a business model that operates in a carbon-efficient world

• Establish strategies for the future• Build a sustainable energy-efficient business

Measurement

Improvement Cycle

Carbon Measurement

• Expensive• Difficult• Process-intensive• Availability of results limited• Difficult to get Actual vs Budget

Methodologies• LCA

–LifeCycle Assessment• Modelling tool• Good for counting product CO2 cost• BSI PAS 2050 launched 29th October 2008

– Defines the method and approach to LCA calculations

36 pages of guidance !

LCA Assessment

Methodologies• LCA

• On line calculators

Methodologies• LCA• On line calculators• Carbon Audit (3rd party)• Company Modelling tools• Integrated within the Accounts function

Solution from Access

Solution from Access • Embodied within the finance system• Minimal additional keystrokes to collate

carbon data• Real time reporting

– By Division, Cost Centre, Individual

• Actual vs Budget• Short learning curve for staff

• Driven by DEFRA tables• Follows GreenHouse Gas protocol• The only solution integrated within the

accounts system• Affordable to SMEs

Accounting for Carbon Emissions

Key Standards Used• GreenHouse Gas Protocol• Scope 1

– Direct production of CO2 emissions• Burning fuel in transport, Chemical process release, creating

electricity

• Scope 2– Indirect use of power

• Scope 3– Other indirect carbon

• 3rd parties, supply chain etc etc

Key Standards Used• Defra Tables

– Sets out UK standards for CO2 calculations

Key Standards Used

Development Strategies

• LCA , Corporate Footprint, or both ?

Any Questions ?