Scope 2 emissions are changing - are you ready to adapt?
SCOPE 2 GUIDANCE
In the world of corporate social responsibility, effectively managing your carbon emissions and data reporting can be difficult and stressful, and at a first sight could give you the temptation to just giving it up.
Staying on track with your carbon and energy reporting is one thing, but if you’re just reporting the numbers, you might be missing an opportunity to help your customers and your stakeholders understand just how your scope 2 emissions are changing and how your business is reducing its environmental impact.
Our series of webinar on Scope 2 Guidance is designed to help you and walk you through what the WRI’s changes in guidance mean and highlight just how painless it can be to switch to a new reporting framework that will provide you with more accurate data and a more representative picture of your actual carbon footprint.
So: let`s see!
First of all, what is actually Scope 2 emissions?
Scope 2 emissions include:
- Electricity (which represents the biggest part of carbon emissions that fall under the Scope 2 Guidance)
- District heating
And, in particular, refer to all the energy that you use but don`t generate on site (because for example you`re purchasing it from an energy provider).
Around a third of total carbon emissions are categorised as Scope 2, so you can understand that being able to talk about and report about them in the proper way is vital for an appropriate reporting.
One of the main aims of the new Scope 2 Guidance is to get businesses to set up a suitable strategy in order to reduce their overall carbon footprint – and consequently produce a more sustainable reporting.
The immediate way to do it is reduce the energy consumption.
How can you reduce your business` energy consumption?
- Energy conservation (which means: simply switch the light off when you leave the office or you`re not actively using one of your premises)
- Efficiency Upgrades
- Better energy sourcing
Especially within the energy sourcing field you can actually be able to make a big difference for the environment and for you company as well. Choosing between traditional energy providers or greener and more ecological sources plays a huge role in your sustainability report and enables you to significantly decrease your carbon emissions. Simply shifting to a different vendor with a less carbon impacting energy producing method can have a significant impact on your overall carbon footprint.
All this said: was a new Guidance really necessary? Is it going to be an actual opportunity for your business to improve your CSR strategy or it`s just a new requirement – another one! – you need to understand and adapt to possibly diverting you from your main duties and business management interests?
The new Guidance
The new Guidance was published in January 2015 and sets out new outlines in order to enable you to report more efficiently on the true emissions of your operations, introducing a further category after the Scope 1 and 3.
Furthermore, the CDP 2016 questionnaire has been updated to align with this new guidance, so as you can now use the new location and market based framework to report. The adaptation of the CDP questionnaire itself underlines how important this change is.
What`s changing in practice? And why is it important?
First of all, you will have to report two numbers in order to align to both two different methods:
- market based method
- location based method
Don`t let this little extra commitment put you off: the value of it is really impressive as you will have the opportunity to talk about the choices and the changes you are making in sourcing and deciding where form and how to source your energy.
In this way you will have the possibility to show your sustainable and more ecological choices highlighting your commitment to sustainability and your positive energy choices.
So what`s the difference between location and market based methods?
Location based method
Basically the location based is the old criteria. With this method you would choose – if you can - regional or sub-national emission factor, which sometimes don`t actually represent your energy choices.
Market based method
- Energy attribute certificate
- Contracts from specified sources
- Supplier/utility emission rate
- Residual mix or grid average
The market based method is more complicated but gives a more detailed representation of your carbon emissions as it takes in count the fact that:
- Suppliers own emissions can be different depending on how they source their energy (i.e. renewables) and their emissions constitute a big part of your actual carbon footprint
- Contractual instruments and direct contracts can also mean your emissions don`t align with a national emission factor.
The national and local emissions factors do not always represent your emissions, that`s why choosing to report aligning to the market based method can highlighted your greener and more ecological choices. These choices – the choice to purchase your energy from less carbon impact.
What do you have to consider and be very careful about?
- Make sure your contractual instruments and agreements are up to date
- Double check your baseline for reporting to see how better choices and more sustainable strategies have had a good impact on your business
- Choose which approach to use for target and/or benchmarking projects.
The market based method will enable to show a greater commitment to sustainability and to better energy sources and will give you more granularity to data.
Need further help?
Send us an email or give us a call on +44 (0)117 325 4168.