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This guide was compiled and produced by The CarbonNeutral Company. The CarbonNeutral Company works with hundreds of companies around the world to deliver business value from their carbon management strategies. For information on how The CarbonNeutral Company can help your business, email enquiries@carbonneutral.com, telephone +44 (0)20 7833 6000 or visit www.carbonneutral.com.

Carbon Measurement Guide

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A guide to measuring your business greenhouse gas emissions helping you to save energy, reduce costs and improve the profile of your company

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Why measure your carbon footprint?
Many businesses realise the environmental and commercial benefits of developing programmes to measure and reduce their carbon emissions. Recent research from organisations including DEFRA and The Carbon Trust shows*:
An effective carbon measurement programme enables you to identify areas within your business where you can easily increase efficiency to reduce costs. A recent DEFRA study found SMEs who had a certified environment management system saved 4,875 and acquired an additional 15,000 per million pounds of turnover. Customers are increasingly loyal to brands seen as actively taking steps to measure and reduce their carbon footprint. 56% of people would be more loyal to a brand if they could see at a glance that it was taking steps to reduce its carbon footprint. Demand is increasing for low carbon products and services. 45% of customers would be prepared to stop buying their favourite brands if they refused to commit to measuring their products carbon footprint, a rate that has doubled in a year from 22%. The Centre for Retail Research has predicted that sales of products with carbon labels will surge to 15.2 billion by 2015. A strong environmental strategy will motivate your staff to take action on climate change and consider their own resource use within the workplace.

Contents

3 Why measure your carbon footprint? 5 An overview of carbon footprint measurement 5 Establishing measurement boundaries 7 Finding your emissions data 11 Hints and tips for carrying out a measurement 13 Measuring your emissions in house or using a third party assessment company 14 Choosing online or offline tools to measure your carbon footprint 15 Using your carbon footprint to define baseline results 17 The role of carbon offsetting 18 Using CarbonNeutral certification 19 About The CarbonNeutral Company

Measuring a business carbon footprint to reduce costs The CarbonNeutral Company worked with Simmons & Simmons law firm to conduct a greenhouse gas assessment across its offices, including emissions from energy, business travel, staff commuting, third party deliveries and waste. The results enabled Simmons & Simmons to substantially lower its carbon footprint by reducing energy consumption 27% over four years, reducing international air travel and increasing the flexibility for home-working.

*New research shows reporting greenhouse gas emissions benefits business www.defra.gov.uk/news/2010/11/30/emissions/ EMS can improve SME profitability randd.defra.gov.uk/Document.aspx?Document=FINALEV0440report.pdf Low carbon products in demand despite challenging economic climate www.guardian.co.uk/environment/2011/jul/01/carbon-trust-research-footprint-consumer-demand

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An overview of carbon footprint measurement
Your carbon footprint (also known as your greenhouse gas assessment) includes the total sum of greenhouse gas (GHG) emissions. To reflect varying business requirements, The CarbonNeutral Protocol identifies the different boundaries for calculating a carbon footprint for entities (such as your business/ company), products, and activities. For more information regarding recommended carbon footprint assessment boundaries see The CarbonNeutral Protocol at carbonneutral.com/our-services/ carbon-neutral. To ensure your carbon footprint assessment is an accurate account of your impact on the environment, it should include the six greenhouse gases that contribute to climate change: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydro fluorocarbons, perfluorocarbons and sulphur-hexafluoride. For purposes of consistency when calculating a carbon footprint, all GHGs are measured in tCO2e (tonnes of carbon dioxide equivalent).
The GHG Protocol is The World Business Council for Sustainable Development (WBCSD) and World Resources Institutes (WRI) Corporate Accounting and Reporting Standards methodology, and is the most commonly used organisational GHG accounting standard. To ensure consistency and transparency The CarbonNeutral Company recommends organisations adhere to the GHG Protocol, which classifies all emissions in to scopes 1, 2 and 3 emissions (see Figure 1).

This guide provides practical advice on measuring your carbon footprint, the second in a series of five steps to build a successful carbon management strategy.

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Scope 2
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Scope 1
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Scope 3
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Employee commuting Business travel Waste generated in operations

Franchises

Use of sold products

Leased assets End-of-life treatment of sold products

Upstream activites

Reporting company

Downstream activites

Figure 1: WRI/WBCSD reporting scopes

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Finding your emissions data
Whatever scope of emissions you are measuring, a key step is to understand where to find the relevant data. Below are sources of information, listed in the preferred order of our GHG assessment partners Emissions source
Scope 1 emissions Natural gas Meter readings where possible. Bills you will have consumption figures on your utility bills. This can be found as a kWh or MWh figure. Expenditure data. Floor area it is possible to estimate emissions based on available data for average emissions. Contact The CarbonNeutral Company forinformation. Company records may state the quantity of refrigerant gases purchased through the contractor. System refrigeration and air conditioning systems often have the system details listed on the units themselves. Supplier may hold information on the volumes of fuel purchased during the set period. Expenditure data. Fuel consumption. Cost of fuel purchased can be calculated using company expenses. Distance travelled collect mileage data from staff. Extrapolation for staff that fail to disclose data or for periods of incomplete data may benecessary.

Establishing measurement boundaries for your greenhouse gas assessment

To calculate your carbon footprint you can measure emissions from your entire company, a specific area such as the operations, and/or all emissions related to a product or service
There are many boundaries to consider when calculating your carbon footprint, depending on the nature of your business. At The CarbonNeutral Company we encourage all businesses to measure emissions for the entire organisation, and if your company produces products then to measure all related emissions associated with these. By following this advice you will have a better understanding of the impact of your business on the environment and where you can find cost savings, as well as the potential for a stronger message to promote your sustainability efforts. The process of calculating your carbon footprint may appear overwhelming, but the benefits of having a strong carbon management programme justifies the effort involved. Breaking the project down in to manageable chunks and assigning tasks to staff members can help ease the burden and make staff feel included in your environmental strategy. Alternatively many of our clients choose to work with assessment companies who manage the process for you. We regularly review the market and have a number of approved assessment partners. To view our recommended assessment companies visit carbonneutral.com/about-us/ who-we-work-with/greenhousegas-assessment-partners. To make your assessment meaningful, allowing you to set targets and track changes over time, we recommend you calculate your emissions over a clearly defined time period. For most companies they choose a 12 month time period. Within The CarbonNeutral Protocol we recommend a complete assessment annually for company certifications, and every two years for product certifications. These recommendations are based on the relative likelihood for carbon emissions to change, and the potential complexity of acquiring emissions data. Which emissions should be measured? Many of our clients ask us which emissions they should measure, scopes 1, 2 and/or 3? Best practice is to include scopes 1, 2 and 3, and the GHG Protocol was amended to incorporate scope 3 emissions at the end of 2011. Their Corporate Standard for GHG accounting recommends the inclusion of scopes 1 and 2, as well as any scope 3 emissions that are material to your business and that you have control over. Within The CarbonNeutral Protocol we stipulate that organisations who want a CarbonNeutral company certification should include all scopes 1 and 2 emissions, as well as the scope 3 emissions of business travel, third party deliveries, and waste, and also recommend that clients include scope 3 emissions from employee commuting.

Data required

Refrigerant gas

Fuel oil / other fuel

Diesel / petrol company owned or leased vehicles

Scope 2 emissions Electricity use grid electricity and grid electricity from a renewable tariff Meter readings where possible. Bills you will have consumption figures on your utility bills. This can be found as a kWh or MWh figure. Expenditure data. Floor area it is possible to estimate emissions based on available data for average emissions. Contact The CarbonNeutral company forinformation.

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Scope 3 emissions

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Hints and tips to carry out a measurement
We have helped hundreds of companies prepare for their GHG assessments. Its important that a GHG assessment is thorough and accurate if it is to be of use to your business, and particularly if you wish to achieve CarbonNeutral certification

Emissions source
Business travel diesel / petrol vehicles, air travel, taxi, rail

Data required
Expenditure figures on a per litre basis or a per mile/kilometre basis. Distance travelled. Various online resources exist to help you calculate distance travelled including: maps.google.com maps.google.co.uk www.viamichelin.com www.maritimechain.com www.distances.com As air travel is often a large source of emissions for a company it is especially important to record all flights to calculate the carbon footprint. Emission sources for flights differ by class, so ensure that you include the class flown in your calculations. Flying economy class counts as fewer carbon emissions per passenger due to more efficient use of space in carrying more people. If you have records of flights but no emissions data then visit www.airrouting.com to help with your calculations. If you know the number of domestic, short-haul and long-haul flights that have been taken, but not the distances or locations, then as a last resort you can assume that the distances are equivalent to typical distances calculated by DEFRA of: Short haul less than 785km Medium haul between 785km and 6,842km Long haul distances of 3,700km or greater These are likely to vary heavily from actual flight distance travelled and should only be used when you are unable to obtain actual data.

Prior to the data collection phase: Establish ownership The first item on any greenhouse gas assessment to-do list should be to select a project owner/leader. This person will be responsible for coordinating the data collection process internally or liaising with your assessment company if you have one. The CarbonNeutral Company can recommend approved assessment companies. If you are conducting a GHG assessment across multiple offices/sites/ regions, it is useful to nominate a point person in each location who is responsible for the data collection from their site. At the beginning of the project, a global launch call or webinar presentation can help to outline the scope of the project and ensure that everyone understands their individual roles and responsibilities.

Business travel hotel stays Third party deliveries

Number of nights stayed. Contractor if you contract deliveries from a third party they are likely to hold data on fuel consumed, distance and/or weight of goods. Company records your records may include weight of deliveries and number of vehicle journeys. Contractor if you employ a private waste contractor they may keep records of volume or weight. Survey if no number is available it is recommended you conduct a survey of the weekly or monthly disposal. You can calculate an estimate by multiplying the size of your bins by the number of collections. Please ensure you make adequate allowances for periods of high waste such as office refurbishments. To ensure consistency and best practice emissions associated with recycled waste must be calculated using national emission factors. When these are not available it is possible to use regional or international emission factors. The method of travel (e.g. petrol car, bicycle, train). The annual distance travelled may be estimated based on a daily distance and extrapolated. We recommend carrying out a staff survey of commuting methods and distances. It may be necessary to calculate averages and extrapolate data for staff who do not supply information. Ensure staff with unusual or high-carbon transport modes are accounted for e.g.astaff member who commutes by air from another city on aregular basis.

Recycled waste, waste to landfill

Employee commuting

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Promote the business value Its important that the project leader understands and is able to communicate the drivers behind the company undertaking a greenhouse gas assessment and the value it will deliver to the business. If people are aware of the larger purpose behind why they are being asked for information and exactly how it will be used, they will be more willing to cooperate with the process in a timely and efficient way. Many assessment managers in larger organisations find it helpful to get someone senior within the business to visibly commit to the project and communicate this widely, to ensure those involved understand that it is abusiness priority.

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say carbon reduction contributes to brand loyalty

of consumers

However, that doesnt mean that an assessment has to be complicated. Below is some of the advice that we share with our customers for ensuring that an assessment runs smoothly.

To assist you in calculating and managing emissions, break down your organisational emissions by division/department to allocate ownership. This will also help you reduce emissions by identifying problem areas. For example, if your supply chain is a large source of emissions, choosing a company that has been awarded CarbonNeutral certification can significantly reduce your overall carbon footprint.

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who will approach them and how it will be positioned. Often suppliers can be reluctant to pass on information that they feel may disadvantage them commercially, so caution needs to be exercised when requesting data. Extrapolate data where necessary When collecting certain emissions data, particularly for employee commuting, it can be difficult to engage employees to be pro-active around uploading the required data within a specific time-frame. Many companies find it useful to use interactive online tools, such as Survey Monkey, to make this a quick and simple activity for employees. Prize draws or charity donations can be used as an incentive to engage employees and encourage them to provide the required data. It is unlikely that all staff will provide the required data to calculate travel emissions for all employees. Use the data you capture to calculate the average emissions per employee, and then extrapolate that data to fill the blanks as accurately as is possible. When required to make assumptions to calculate your carbon footprint it is recommended you use the principle of worst-case-scenario to ensure your footprint is not under counted.

Write a clear plan Finding out where to get the information you need is often the most time-consuming part of the assessment process. This guide includes a list of potential sources of emissions data that you can use as a framework. We recommend that you develop a clear plan which outlines where, when and how you are going to get the information required. Investigating the emissions source information available to you before you officially begin the process will allow you to manage the project more effectively and ensure that deadlines are realistic and achievable. Greenhouse gas assessments usually cover a 12 month period, allowing you to set targets and monitor for changes over time. You may find it beneficial to align the assessment with your companys accounting period, especially if you budget for savings from internal efficiencies or allocate budget to support offset activities that neutralise the business emissions. Maintaining a spreadsheet all year round enables you to keep track of business travel, commuting, deliveries and vehicle mileage. Alternatively, track emissions on a monthly/ quarterly basis using online assessment tools to monitor trends, assist in reducing emissions, and ease the burden of data capture before the annual assessment is due. If this is your first greenhouse gas assessment and data is not

available for the full 12 month period, it is possible to extrapolate data based upon a sample. After the data collection phase is complete, we recommend: Set realistic deadlines In theory, a greenhouse gas assessment can be completed almost immediately (depending on complexity) if treated as a full-time project. However, those responsible for collecting data rarely have the capacity to do this outside of their day-to-day responsibilities. Therefore it is important to set yourself and others realistic deadlines which allow for enough time to collect the data in addition to normal business activity. As with all good project management, breaking things down into smaller tasks and setting deadlines for specific people and activities is preferable to setting one single deadline for everyone which can often lead to delays and unexpected problems. Communicate effectively Communication is a critical part of procuring the right information from a variety of sources. Holding regular meetings/calls with those responsible will help to keep the project front of mind and it is worth investing the time to brief people properly at the beginning to save time chasing further into the project. If it is necessary to go outside of the business to get emissions data, i.e. from third party suppliers, it is important to think carefully about

Measuring your emissions in house or using a third party assessment company

Whether you choose to measure your emissions in house or appoint a third party assessment company, it is essential your reports are accurate and credible for setting targets and communicating achievements
The time required and financial costs of greenhouse gas assessments vary dependent on the size of your company, your industry, what you decide to measure, and how you measure it. The benefits of conducting your greenhouse gas assessment in house Costs of assessment are reduced. Costs of self assessment are continuing to drop with the growing availability of GHG accounting software. You can involve numerous staff members to gain buy in to your environmental efforts and encourage staff and departments to take responsibility for their emissions. The benefits of appointing a third party organisation to conduct your greenhouse gas assessment As experts they can simplify what can be a complicated and time consuming process. When assumptions are necessary to compensate for missing data, experts have access to reliable data to make accurate assumptions. They have technical expertise for using more sophisticated GHG reporting software. If you are reporting your carbon footprint results for external purposes e.g. a CSR report, using a third party provider adds an extra level of quality control. Their expertise can be utilised to set reduction targets and identify opportunities for reducing emissions and saving money. To achieve CarbonNeutral certification as defined by The CarbonNeutral Protocol your emissions data has to be verified by a third party independent assessment company to ensure validity of claims. To find out more about The CarbonNeutral Companys recommended assessment partners visit carbonneutral.com/ about-us/who-we-work-with/ greenhouse-gas-assessmentpartners.

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Using your carbon footprint to define baseline results and set reduction targets
Once you have measured the carbon footprint of your organisation you are ready to set reduction targets against your baseline figures. There are two broad types of GHG reduction target a company can set an absolute target and an intensity target
Absolute GHG reduction targets compare total GHG emissions in the target year to those in a base year. For example, a target to reduce CO2 emissions from electricity usage by 5% each year from the 2012 figure. By comparison, an intensity target is expressed as a ratio of emissions relative to a particular business metric. Business metrics are typically measured in physical units (e.g. number of employees) or monetary units (e.g. of revenue). A target to reduce GHG emissions by 25% per full time employee is an example of an intensity target. Both absolute and intensity targets have pros and cons that should be carefully considered before choosing one type of target over another. In our experience the majority of our clients choose an absolute target, but note that some clients choose to adopt both an absolute and intensity-based target for different parts of the business. For more information and assistance in setting your carbon reduction target, visit carbonneutral.com/ our-services/target/ or call +44 (0)20 7833 6000.

Choosing online or offline tools to measure your carbon footprint

There are a range of online and offline assessment tools that can help you measure your emissions. Both have different advantages, and it is best to look at which will meet your specific requirements for measuring your carbon emissions
The benefits of online greenhouse gas assessment All your data, calculations and reports in one location. Allows multiple users to review and update data. Automated emission and conversion factor databases. Choice of annual, quarterly or monthly data collection. Often KPIs are built in, with the ability to create user defined KPIs See results build and interrogate them at any time. Generate reports, graphs and Excel outputs. Monitor trends in emissions overtime. Monitor the performance of reduction efforts. The benefits of offline greenhouse gas assessment Can be a bespoke assessment rather than a standard online solution. Can includes recommendations for reducing your footprint. Tailored forms for streamlined data collection. Phone support from experienced analysts if you choose to use a third party assessment company. You may wish to appoint an assessment partner to ease the process of measuring your emissions. Costs of greenhouse gas assessments vary dependent on the size of your company, your industry, what you decide to measure and how you measure it. To find out more about The CarbonNeutral Companys recommended assessment partners visit carbonneutral.com/ about-us/who-we-work-with/ greenhouse-gas-assessmentpartners.

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680kg
Fly economy rather than premium economy and save

of CO2
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Using CarbonNeutral certification to differentiate and establish your business as a market leader
CarbonNeutral certification can be used to prove your commitment to the environment, establishing you above your competitors as a leader in reducing climate change, to help you win new business, retain existing customers, and motivate your staff
Entities: defined by legal status and spatial boundaries, covering all types of organisations, including companies and public sector bodies, households, individuals and sub-divisions of these. Products: physical goods produced for sale. Products include standard consumer goods such as milk, paper or computers, or single use or custom built products such as buildings or urban developments. Products can be considered for carbon neutrality on either a cradle-to-customer or cradleto-grave basis. Activity: defined by the delivery of utility through a combination of mobile and stationary activities, including traditional transportation services (flights, car journeys, logistics etc), information provision such as hosting of data, or professional services, and one-off events that involve a combination of mobile and stationary activities. To discuss how CarbonNeutral certification can help your organisation increase revenue, manage costs and engage stakeholders call +44 (0)20 7833 6000 or email enquiries@ carbonneutral.com. About The CarbonNeutral Company Since 1997 The CarbonNeutral Company has helped businesses reduce their carbon footprint in order to increase revenue, manage costs and engage stakeholders. We are a world-leading provider of carbon reduction solutions and were named the Best Offset Retailer by Environmental Finance. To find out more about how reducing your carbon emissions can help you meet your business objectives please telephone +44 (0)20 7833 6000, email enquiries@carbonneutral.com, or visit carbonneutral.com. You can also register for our email at carbonneutral.com/carbon-copy, and download our free whitepapers to learn more about how carbon management works and the beneficial role it can play for your organisation at carbonneutral.com/ knowledge-centre/white-papers.

The role of carbon offsetting alongside internal reductions to reduce your carbon footprint
Due to the high cost of some internal changes, many organisations decide to support carbon offset projects alongside their internal efficiency strategy to reduce and remove CO2 from the global atmosphere

Carbon offsets are credits for reductions in greenhouse gas emissions made at another location, such as wind farms which create renewable energy and reduce the need for fossil-fuel powered energy, and are quantified and sold in metric tonnes of carbon dioxide equivalent (COe). Buying one tonne of carbon offsets means there will be one less tonne of carbon dioxide in the atmosphere than there would otherwise have been. This could be, for example, a project to swap coalfired power stations with wind farms or hydro power. Carbon offsetting is often the fastest way to achieve the deepest carbon reductions for your business, and many projects deliver added benefits at the project site, such as employment opportunities, community development programmes, training and education. For a carbon offset to be credible it must meet essential quality criteria, including proof that it is additional (the reduction in emissions would

The CarbonNeutral Companys publication Carbon Reduction A Guide to Reducing Your Business Greenhouse Gas Emissions offers numerous hints and tips to reduce your carbon footprint. To receive your copy visit www.carbonneutral.com/ knowledge-centre/white-papers, email enquiries@carbonneutral.com or telephone +44 (0)20 7833 6000. For more information on carbon offsets, including verification standards and examples of verified carbon offset projects, visit carbonneutral.com/carbon-offsets. If you are interested in using carbon offsets alongside your internal reduction efforts to reduce the carbon footprint of your business please email enquiries@carbonneutral.com or telephone +44 (0)20 7833 6000.

0 2050
To keep climate change below 2 degrees carbon emissions must be reduced by

According to the worlds leading scientists of the Intergovernmental Panel on Climate Change (IPCC), carbon emissions must be reduced by 80% by 2050 to keep climate change below 2 degrees and avoid catastrophic changes to weather conditions and sea levels.

not have occurred without), that it will be retired from the carbon market so it cannot be double counted, and that it addresses issues such as permanence (it delivers the reductions it stated) and leakage (the emission reduction in one area doesnt cause an increase in emissions somewhere else).

The CarbonNeutral Protocol is the global standard for carbon neutrality, guaranteeing the integrity and credibility of carbon neutral claims. The CarbonNeutral Protocol is developed in consultation with The CarbonNeutral Companys Advisory Forum (AF), a team of independent experts who ensure quality and integrity. The CarbonNeutral Protocol describes the requirements for achieving CarbonNeutral certification and controls employed by The CarbonNeutral Company to ensure the correct use of CarbonNeutral logos. To provide consistency across a wide range of possible situations, The CarbonNeutral Protocol provides for a number of different CarbonNeutral certifications corresponding to different entities, products and activities. These certifications are grouped into three classes:

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