Opinion: Why Businesses should report carbon emissions

Why Businesses should report carbon emissions.

By Polly Green

The reporting of carbon emissions is not a new operation implemented in the battle to reduce the greenhouse gasses in our atmosphere. There are already institutions and agreements in place such as the Emissions Trading Scheme in the European Union, and the UK’s Companies Act which require various companies to report their greenhouse gas emissions. Along with these implements, comes the gradual yet necessary transition to a low carbon future, this transformation of the economy is becoming more widespread and necessary than ever before. At this point it is not a matter of if, but of when, as we have no choice but to improve our efficiency, and sustainability. In order to minimise the risk of a completely chaotic future in business, where companies miss the opportunity to transform, and therefore cannot compete with those that have carbon reporting, businesses will need to report emissions. A worldwide transparency of greenhouse gas production would allow societies to adapt together and encourage the individual and corporation to make the vital changes needed.

The economic benefits of reporting emissions are not solely advantageous to the environment. One may believe that reporting company emissions will increase its transparency, exploiting the institution’s poor sustainable business model therefore loosing customer loyalty and investment. This in fact is not the case, as emerging research from the European Centre For Corporate Engagement shows a significant and negative relation between disclosing CO2 emission levels and the cost of bank loans, and more favourable lending conditions for those who voluntarily disclose. As well as this, the disclosure of information and the research towards it is beneficial in portraying carbon emissions as a serious metric and performance indicator, and those businesses that pioneer this movement, will be favoured by both individuals and stakeholders.

Businesses have the moral duty to report their carbon emissions, as this improves transparency for investors and individuals to make certain choices in the future regarding their loyalty and safe investment. With society becoming more aware of the detrimental effects deriving from global warming, customers will favour businesses which aim to reduce their emissions and can publicly prove a track record of constant improvement. Investors, with the use of standard measurements provided by organisations such as the Greenhouse Gas (GHG) Protocol, can safely comprehend and compare companies using the emissions reports. When the transition to a low carbon future becomes more evident, those which haven’t published their emission figures will be seen in a different light. This transparency therefore reflects an impressive business model built on trust, improvement and future orientated thinking.

The improvement in transparency provides a starting point for businesses to transform, and adapt to a low carbon future. Sustainability consultancy firms (such as Carbon Smart) assist in spotting inefficiencies, saving money and convert the idea of reducing emissions from a compliance, into a successful business strategy. With hundreds of case studies already proving advantageous business impacts, there is no doubt that reporting and reducing emissions is beneficial.

Criticism of carbon reporting comes from stakeholders complaining of methodological weakness, as well as the risk of double counting from reports. It is all well and good encouraging carbon reporting, but in order for it to be worthwhile and impact investor decisions there must be a credible way of reporting carbon emissions, providing transparent and standardised reporting to bring about change. More recently, there has been pressure for firms to also report their carbon reserves, due to new theories of unburnable carbon and stranded assets proving how these fossil fuels cannot be extracted in a below two degree scenario. In summary, a credible, transparent carbon reporting structure is required to bring about a sustained change from businesses, which they have a moral obligation to comply with.


Opinion: Negative Emissions and the Potential for Forests

Opinion: Negative Emissions and the Potential for Forests

By Chris Friedler

Environmental problems are nothing new, but the policy on many of the historical environmental problems has focused on diverting pollution first and reducing the pollution later. In industrial Britain, smoke from chimneys caused air pollution, so companies built taller chimney, only later focusing on techniques to make the fuel (coal in this case) cleaner. When London was subject to the ‘Great Stink’ in the Victorian era, sewage flowed through the Thames, and better sewage networks were built to divert it – it was only later and in more modern times that technology was developed to treat sewage, so rivers and oceans didn’t become dumping grounds.

Putting aside that unpleasant imagery, climate change seems to have taken a different tack to these old school environmental problems. Reducing greenhouse gas emissions from power, transport and so on is predominantly focusing on changing technologies, so that pollution is reduced or neutralised. The main way of actually diverting greenhouse gas emissions seem much more future based and exotic, with carbon capture and storage projects, as well as more ambitious unproven technologies about capturing greenhouse gases being discussed in hushed tones, like an unspoken saviour, there to sort out the problem if climate change gets out of hand. While there are many in the climate community who are wary about relying on future unproven technologies about capturing emissions, and I am one of them, the most basic of all is a very current ‘technology’ – afforestation.

The main and apparent problem in the UK with treating afforestation as a way to Screen Shot 2017-11-28 at 17.07.32capture greenhouse gas emissions and reduce emissions is that we are a small country, with a lot of people, and a lot of infrastructure. It would be a lovely idea if we could cover the UK in forests and not have to rely quite so much on electric cars and offshore wind farms – unfortunately, being a small country we don’t have a lot of room to do that. The Committee on Climate Change foresees that the UK could be carbon neutral (that is, anything we emit becomes absorbed within the UK) by 2050 if we reduce emissions by 90% below 1990 levels. To crunch the numbers, that would be a reduction of 720Mt of greenhouse gas emissions, with 80Mt left over. So, in theory, the UK would still be emitting from some hard to treat sectors of the economy, like industry and agriculture, but it would be instantly absorbed by the new growth in trees. It’s a great idea, but there is one big problem.

Currently, about 9Mt of the UK’s emissions is absorbed by trees, a little over 1% of 1990 emissions and absorbing almost 2% of emissions today. So between now and 2050, we’d need to increase this by ten times, just to absorb what emissions would be left over. Never mind the exotic idea of net negative emissions, where the UK would absorb emissions from outside its borders. The CCC does project a lot of this extra growth coming from new negative emissions technologies and not forests, so the idea we could increase the carbon absorbing properties of forest tenfold already sounds a little unrealistic. But if we can’t increase forests by this much, then how much can forests contribute in this country in the fight against climate change in the future?

Of the 9Mt our current forests absorb, that comes from forest cover across about 12.6% of the UK. A disproportionate amount of this unsurprisingly comes from less populated places – Scotland and Wales have a much higher proportion, acre for acre, of forest cover than England does. So of this forest cover, how much higher could we go to? 15%? 20%? 30%? 50% or higher? Then there’s also the much more complicated issue of how much of the greenhouse gases each tree absorbs. Different trees absorb different amounts, and trees absorb more gases whilst growing than mature. So if we had forests absorbing the same amount as the current 12.6% and we need a tenfold increase that would mean we need to increase forest cover to 126% of UK land cover – which is not so practical. In reality, the new trees we would be planting would absorb more on average than the current stock, and if we were planting these with the sole purpose of absorbing greenhouse gases it’s likely we could improve on that figure at least slightly. Even so, making forests a substantial contributor to reducing the UK’s emissions seems unrealistic.

If that’s the case, why are we even advocating afforestation as a realistic climate policy in the first place? Substantial our future forests may be, not but insignificant, and only by today’s reckoning. If we increased the 9Mt of capture to 18Mt, which may not seem like much today, as in 2016 UK total greenhouse gas emissions were 466Mt. However, if we reach our 2050 target of an 80% reduction on 1990 levels, or 160Mt, then the contribution from forests rises substantially. So while it may not be a be all and end all solution, it buys time to reduce emissions and slows the harm caused. You could say the more forest cover we have, the better.

In short, it seems that the simple act of planting trees, while not being our ultimate climate salvation, is an important, and dare I say comparatively easy approach to tackling climate change in the UK. The UK will never be Brazil or Canada, with vast forests sucking carbon out of the atmosphere well beyond its own levels of emissions. But without increasing forestry, we are shooting ourselves in the foot, ignoring a simple and environmentally friendly, proven solution.