Companies involved in offsetting their carbon footprint have access to over twenty tools to calculate their emissions, most of which have been launched in the last year. So far, the voluntary carbon offsetting market is dominated by European players. Reviews of their efforts have not been all too positive, so US companies following in their footsteps do best to avoid the pitfalls.
The main criticism centers on what’s left out of the equation. Companies embarking on greening up their business practices are faced with a daunting task and most go about it the “easy way” at first. There’s the option to simply offset carbons on the Chicago Climate Exchange, the European Climate Exchange or on the newly established NYMEX venture, the Green Exchange. Businesses have access to these exchanges if they wish to reduce their overall greenhouse gas emissions by as little as 1%.
Another easy start is to go green at corporate level. Carbon calculator designers themselves say that they’ve calibrated the tools to deliberately not include the most thorny issues. That is so that they do not scare off company bosses. “Instead it’s to raise awareness about the scale of the impact or quickly produce figures for a carbon offset,” according to a report on ClimateChangeCorp.com.
That is not to say that the real deal for people wanting to progress on from that level doesn’t exist. Once companies have developed the right mindset, having learned that relatively simple energy reduction tricks can create cost savings of 20% which in many cases equals increased sales of around 5%, they’re likely to want more. And the good news is that there’s a plethora of very detailed guidelines on offset standards. Companies seriously wanting to make a real difference only have to find them.
Last year alone, some 20 tools were released, most free of charge. To create order in this chaos, the WWF has published a 105-page guide to and comparison of the ten standards most widely in use by companies voluntarily offsetting carbons. The document is entitled “Making Sense of the Voluntary Carbon Market: A Comparison of Carbon Offset Standards” Ecosystemmarketplace.com recommends the guide wholeheartedly, saying it’s “a good primer for beginners and an adequate refresher for veterans.” EcoSystemMarketplace’s own beginners’guide is aimed at getting a quick insight into the core issues.
The better calculators are based on the publicly available guidelines such as the definitions in the Greenhouse Gas Protocol (drawn up by the World Resources Institute). The UK´s Carbon Trust calculator is based on these guidelines and also takes into account the UK’s environmental regulator Defra’s new Environmental Reporting Guidelines, the UK Emissions Trading Scheme and Climate Change Levy agreements. The Carbon Trust offers four in depth calculators: an accurate co2 measuring tool, an “environmental reporting” tool, a tool to account for weather factors and a highly detailed energy calculator. ClimateChange.corp criticizes the effort saying that the Carbon Trust’s tools leave out emissions generated by a company’s supply chain.
The Carbon Trust targets large and small companies. The small companies have free access to a carbon baseline tool for businesses without process emissions. Carbon Trust also offers cheap loans for small companies investing in eco-friendly operation procedures.
Companies can also devise programs with outside help. The effort will pay off because once you’ve got a program installed, the thing will virtually run itself. Companies that include “environmental reporting” in their daily operations that set new benchmarks in the industry include Air France KLM. The airline sought assistance from Enablon, a Netherlands based carbon software design company which works with large companies. Another example of an outside consultancy is the Edinburgh Centre for Carbon Management which has carried out assignments for companies ranging from General Electric, BP and TetraPak UK, which offsets carbons by investing in Ugandan tree projects.
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Meet Beatrice Ahimbisibwe. She’s a widowed single mother and a school-teacher in Uganda. Plus she creates 5.7 tons worth of carbon offsetting credits annually for TetraPak UK, a company intent on reducing its carbon footprint.
Ahimbisibwe owns a little plot of land on which she grows some of the trees involved in TetraPak’s contract to produce fresh air for all the pollution caused by its production processes. A case study of the carbon sequestration project on EcoSystemMarketplace.com reveals interesting insights into the practices of an emissions offsetting program.
The study reveals that when TetraPak UK started to scour around for options to trade carbons in 2003, the company didn’t get far all by itself. It found outside help at the Edinburgh Centre for Carbon Management (ECCM). The first elemental step in the carbon footprint reduction effort which ECCM consulted TetraPak on was the devision of a computer program calculating the actual damage done. TetraPak’s annual carbon footprint is now monitored, based on real data.
In 2004, TetraPak UK began to actively reduce carbon emissions, which had been determined at 11,780 tons for 2001. This is where Uganda comes in sight. A total of 80%, of TetraPak UK’s carbon program “materializes” from Ugandan projects. The remaining 20% comes from bio-mass and solar energy projects in India and Sri Lanka.
The program was successful. In 2004, a 13% reduction was achieved from the company’s 2001 footprint. There are no legal requirements guiding companies here, so TetraPak’s regime is more or less self-imposed. TetraPak said it would try for a 15% reduction target in 2005.
Ahimbisibwe was approached by ECOTRUST, a Ugandan NGO, to sign a carbon sequestration contract. She was not using one hectare of land that she owns and was interested in planting native species of trees on it for the benefit of the environment. The contract she signed provides her with an amount of $8 per ton of sequestered carbon. She’s expected to generate 57 tons over ten years. Ahimbisibwe is quite happy with this, also because she hasn’t signed away too lenghy a time span. She’s allowed to prune and sell the wood after 15 years.
