Calculating the costs

Oct 01 2012 07:00
*Tim James

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The Carbon Disclosure Project (and why businesses should start taking note)

FOR the last few weeks, the media has said a great deal about the carbon disclosure project (CDP), a global initiative encouraging big businesses to report their carbon footprint and water usage and the steps that they are taking to reduce it.

It was introduced to South Africa in 2007 and has recently also been extended to cities.

This year, CDP has requested climate change information from the 100 largest South African companies by market capitalisation, based on the JSE All Share Index [JSE:J203].

Leading technology companies like Apple, Google, Facebook, Amazon, and Microsoft use massive amounts of energy, electricity and power.

Greenpeace estimates that some individual data centres consume as much electricity as 180 000 households per annum. In terms of emissions, the IT industry is estimated to contribute 2% to 3% to global emissions, which continues to increase as more mobile devices get online.

Facebook recently disclosed its carbon footprint, and many other companies have been working to become more efficient and reduce emissions, which not only cuts down on environmental costs but also reduces overheads.

Despite the benefits, there is no obligation yet for businesses to report their emissions – a pity, since there can be no doubt that in geographies where legislation has been passed to support emissions reduction, business uptake is far more significant.

However, internationally and locally the government has indicated that it will introduce carbon taxation in the 2013/14 budget. The exact meaning of this is unknown - but it is clear that at least some businesses will be required by law to report and disclose their footprints in the short term.

Regardless of whether this will be obligatory or not, there there are a number of business benefits to calculating your carbon emissions. The main benefits would include identifying emissions sources – which can then reveal reduction opportunities. 

Reducing emissions often lead to reduced costs, which is important in the tough economic times we find ourselves in. It is also important to understand your carbon profile and hence your risk exposure when emissions taxation and/or emissions caps are introduced.

Improved staff morale and marketing and public relations benefits are of course another advantage.

How to calculate your firm's carbon footprint

It is relatively easy to determine your carbon emissions. First and foremost, companies should measure their emissions by using a recognised standard, such as the Greenhouse Gas Protocol.

This can be achieved by using tools such as The Carbon Report or through a consulting approach.

The process involves identifying emissions sources, gathering non-financial data that supports these sources, and then quantifying the emissions. This is in fact not an onerous task, and it is an important step in embracing a sustainable future.

Once companies have gained further insight into the state of their carbon emissions, they can examine the possibilities of emissions reduction or offsetting.

Business should always target emissions reduction opportunities prior to offsetting any emissions. This not only lowers costs but demonstrates the sustainable journey and a commitment to emissions reduction. 

However, you will never be able to eliminate all emissions - at least with current technologies - and these can be offset through a reputable offset provider.

Offsets should be certified or verified through one of the globally recognised standards like the Voluntary Carbon Standard, Plan Vivo or the CDM Gold Standard.

For sustainableIT's offset, we chose a reforestation project in Mozambique called the Sofala Community Carbon Project which was chosen as the source of the offset purchased. 

This project achieves a CCBA triple Gold status, which effectively means it demonstrates exceptional benefits in areas of climate, community and biodiversity.

It's important to note that even a small company can make a positive change. Encourage teleworking among staff and employ technology to power manage office equipment, desktops and server infrastructure. Energy consumption can be kept to a minimum through natural lighting. 

Although reducing the carbon footprint may not be high on the priority list for many companies at present, it may soon be. It's best to start investigating ways to cut down on carbon emissions before legislation forces companies to do so.

 - Fin24

*Tim James is the owner of sustainableIT and the distributor of 1E.

* Follow Fin24 on TwitterFacebookGoogle+ and Pinterest

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