Wednesday, December 10, 2008

What can a single company do? or, "A whole lotta carbon"

I've been spending much of the past few days reviewing the CDP6 responses that include Scope 3 "indirect" emissions. As a brief backgrounder, the Scope 1, 2, and 3 terminology was adopted by the Greenhouse Gas Protocol's Corporate Standard, and revised as "direct" and "indirect" emissions in the ISO 14064 documents. The emissions caused by facilities owned and operated by a company are classified as Scope 1, purchased electricity and steam as Scope 2, and emissions related to a company's activities but not taking place at owned or operated facilities are Scope 3. You could therefore refer to the Scope 3 inventory as the emissions due to a company's supply chain, both upstream and downstream.

So since the GHG Protocol designated Scope 3 inventorization as optional, not all companies that report to the Carbon Disclosure Project provide those numbers - hence the reason for developing new Scope 3 guidelines. However, some companies have taken these matters into their own hands and ventured into the scary wilderness of value chain accounting. So while more than 1,700 companies worldwide are currently reporting to CDP, only about 200 are disclosing Scope 3 emissions other than the conventionals (i.e., business travel, employee commuting).

You'd expect oil & gas companies as well as vehicle manufacturers to post heavy Scope 3 figures since their products' downstream impacts fall within the Scope 3 zone. If you produce oil, and it is refined into gasoline and then combusted, all the emissions released by those processes would be included in your Scope 3. Now tell me what you think the magnitude of a single company's reach is?

How about 3.1% of total global fossil CO2 emissions? Don't overlook the word 'fossil,' because land use, land use change and forestry (LULUCF) emissions may amount to about 1/3 of non-LULUCF emissions, meaning 3.1 would drop with that inclusion. Since the absolute number they provide is 743 mega-tonnes of CO2, which is far under 3.1% of 28 GtCO2 (not CO2e), as per 2005, it seems as if they're doing themselves a disservice. To help put this in context, CAIT shows that South America's 2005 CO2 emissions were only about 3% of the global total - but this is all wrapped up in one company's supply chain.

So what comes next? Well, GHG management, reduction targets, and supply chain cooperation hopefully. The beauty of the Scope 3 inventory framework is in emphasizing a company's sphere of influence over its supply chain partners. While you'll have more sway with your immediate neighbors, those who directly supply to you or who directly distribute your goods, if you're large enough to make waves then all neighbors will follow. Such has been the strategy of Wal-Mart who's launched an aggressive supply chain examination to determine where the greatest GHG reduction opportunities exist. This is no simple task - imagine having to go through 65,000+ suppliers. Well, all in a day's work to "rollback the prices." I hope that their program is successful in "rolling back" the emissions as well.

Tuesday, December 09, 2008

Sacramento Bee Op-Ed by Phil Angelides

Count a victory for the Apollo Alliance. For several years now, this coalition of organizations advocating for "green growth" to spur job creation and the expansion of renewables has been hitting the pavement with insufficient media exposure. A recent edition of the Sacramento Bee features an op-ed piece from AA Chairman Phil Angelides on why the time is right for a green economic revival.


My View: New strategy to rally nation under green flag
By Phil Angelides
Special to The Bee
Published: Thursday, Nov. 20, 2008 | Page 11A

When it comes to America's financial crisis, there's plenty of blame to go around. You don't have to dig far into the toxic sludge of bad credit, soaring deficits, fiscal mismanagement and deregulation to see that all of it blends together to form a really big mess. And you don't need a Ph.D. in economics to know that the financial market meltdown is a warning sign that America's economy is in desperate need of an overhaul.

Leaders of nations, just like executives of financial institutions, are responsible for understanding and responding to new market signals. And when they don't, the economies of great nations – just like the creditworthiness of corporate giants – can crumble with frightening speed.

Which brings me to the biggest emerging market opportunity of our lifetime. That is the opportunity to galvanize American technology, workers, ingenuity and courage to do something truly great – building a clean-energy, good-jobs, made-in-America economy that will power our nation in the 21st century. [...]

Sunday, December 07, 2008

Climate Change Photography

I came across GHG Photos tonight, a site launched at the end of October that showcases the work of six photographers who are traveling the globe to visually document the effects of climate change. While many of these shots represent 'end results,' take a look at the winners of the UNFCCC CDM Photo Contest here where users submitted photos of Clean Development Mechanism (CDM) projects. It's not clear to me how or why the First Place finish beat out the 2nd and 3rd. Maybe it had to do with failing to deliver CERs (snare drum please).