The Carbon Audit

In this session we will attempt to answer the following questions:

1. What is a Carbon Audit?2. Why should we do a Carbon Audit?3. How do you do a Carbon Audit?4. How does Carbon Footprinting impact

on the marketing process?5. What are the organisation’s options?6. Where to look for further information

1: What is a Carbon Audit?• A means of measuring and recording the CO2

(Carbon Dioxide) emissions of an organisation• Sometimes called a ‘Carbon Footprint’• Includes:

– direct power usage (from fuel-powered sources)– fuel-powered transport (haulage & travel)

• The ‘wider footprint’ may include:– waste and recycling policy– carbon saving arrangements with supply chain partners– carbon saving arrangements with employees

• Carbon Audit is the first step in developing a Carbon Strategy

• Carbon Strategy: A long term action plan to manage and reduce the carbon emissions of the organisation and its clients

• Carbon Strategy is compulsory in certain designated industries (eg steel and car manufacturers)

1: Carbon Audit and Carbon Strategy

2: Why should we do a Carbon Audit?

• Global Warming is being caused by Green House Gasses (GHGs)

• Carbon Dioxide (CO2) accounts for 85% of all GHGs

• 1997 Kyoto Protocol (ratified by UN membership 2005) establishes targets for industrialised nations to cut carbon emissions

• UK target: to cut emissions to 12.5% below 1990 level by 2012 (failure likely)

• World average target is 5.7% below 1990 levels

• Corporate social responsibility policies• Employee & customer expectations• Brand value• Further legislation likely• Potential 20% saving in energy

consumption (The Carbon Consultancy)• Carbon reporting provides superior

management data

2: Why should we do a Carbon Audit?

2: The Climate Change Levy

• A new business tax on the use of all energy - introduced in 2001

• Applies to electricity, gas, coal and lpg (liquid petroleum gas)

• Oil, diesel and petrol taxed under the Hydrocarbon Fuels Act

3: How do you do a Carbon Audit?

3: How do you do a Carbon Audit?

• A carbon analyst calculates the carbon footprint in accordance with ISO Standard 14064

• International organisations apply GHG Protocol standards

• Carbon Reporting is split: – a) Power b) Travel

Core Footprint:• Power:

– electricity grid, natural gas, oil-fired• Transport:

– road mileage (vehicle type), rail mileage, air mileage (origin-destination)

– Road haulage (mileage & weight) air freight (weight) courier mileages

3: How do you do a Carbon Audit?

Wider Carbon Footprint:• Materials (waste and recycling)

– Paper used (quantity & type)– Materials sent to recycling (quantity & type)– Waste not recycled (mixed, by weight)

• Detailed Footprint Analysis– Detailed energy usage by supplier– Detailed air & road travel (vehicle class and mileages)– Commuting: distance and type for all employees– Other savings e.g. video conferencing

3: How do you do a Carbon Audit?

Reporting:• Total emissions, core and non-core• Power used per square foot (offices)• Carbon value per employee (per job /

project / department)• Benchmark results inter- and intra-

industry

3: How do you do a Carbon Audit?

4: How does Carbon Footprinting impact on the marketing process?

There are two theoretical frameworks which can provide a basis for an environmental audit of the marketing process:

a) The ‘Green’ 7 Psb) The ‘Value Chain’

4: a) The ‘Green’ 7 Ps• Product

– Finite or renewable sourced materials?

– Manufacturing processes – Environmental impact in

use and disposal• Price

– Additional costs incurred– Marketplace price

sensitivity• Place

– Distribution and Retail operations

• Promotion– Communicate customer

value– ‘Green’ means of

communication• People

– Training and support• Physical Evidence

– Branding, Packaging, other?

• Processes– Procedures & policies eg

green travel arrangements

4: b) The Value Chain (Porter)

Primary Activities:• Inbound Logistics

– Arrangements for sourcing and receiving outsourced materials and services

• Operations– Internal manufacturing and processing

• Outbound Logistics– Packaging and distribution

• Sales– Efficiency of sales processes

• Service– Added value service procedures

4: b) The Value Chain (Porter)

4: b) The Value Chain (Porter)

• Human Resources• Training, motivations,

values

• Technology• Alternative & energy

efficient

• Marketing• Materials and messages

• Procurement• Carbon-audited inputs

• Strategies• Corporate environmental

positioning

• Procedures• ISO 14000?

• Infrastructure• Energy-efficient facilities• Financial policies

• IT Systems• Alternative energy-saving

processes

Support Activities:

5: What are the organisation’s options?

• Carbon offsets:– Calculate emissions from specific activity

(e.g.per journey) and pay third party to reduce CO2 by similar amount (e.g. plant trees)

• Carbon funding:– Buy emission reductions being created by

another project (as capital start-up and / or as income)

• Certified Emissions Reductions (CERs)– Verified emission savings can be sold

through the EU Emissions Trading Scheme (EUETS)

• UK Emissions Trading Scheme– Companies with Climate Change Levy

Agreements can buy and sell credits with other UK companies

5: What are the organisation’s options?

Generic solutions:• Cut energy usage• Cut waste• Increase re-cycling• Cut down travel & haulage mileage• Reduce commuting

5: What are the organisation’s options?

• Create carbon-conscious corporate culture• Balance short term ‘PR opportunities’ with long term

carbon strategy objectives• Integrated carbon strategies (not just one carbon

reduction strategy)• Improve carbon / energy / travel reporting procedures• Devolve responsibility for energy efficiency to

departmental level• Engage employees in work-based and domestic

carbon reduction initiatives

5: What are the organisation’s options?

6: Further information

Government:• http://www.direct.gov.uk• http://actonco2.direct.gov.uk• http://www.defra.gov.uk

Other:• http://www.carbontrust.co.uk• http://www.carbonbalanced.org• http://www.carbonmanagers.com• http://www.thecarbonconsultancy.co.uk• http://www.iso.org• http://www.iso-14001.org.uk