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  • Writer's pictureCatherine Bottrill

Why should I do a carbon audit?

Updated: Jul 3

Carbon auditing is the process of counting the carbon emissions associated with your company’s operations. It is these carbon emissions (CO2) that are contributing to climate change. Knowing your emissions allows you to see the areas of our greatest impact, to set targets and to reduce and possibly offset your residual emissions. Carbon audits allow you to focus your reduction efforts in the appropriate places.

Pilio can help you navigate this minefield with our carbon accounting software and our consultancy services.

What about other gases?

Other gases contribute to climate change such as refrigerant gases (CFCs and HFCs), Ammonia, SF6 and methane.

The effect of some of these gases molecule-for-molecule can be far higher that CO2 but their emissions are far smaller and their overall effect is smaller then CO2.

Many emissions factors for various activities (such as driving lorries) take account of these other emissions through the supply chain and include them in the final intensity factors. If you see CO2e (CO2 equivalent) then they have been taken account of.

Most companies would not worry about these other gas emissions. Unless a company was in manufacturing, farming or relied heavily on refrigeration, they are small and can be ignored.

What are the Scopes?

Carbon emissions are broken down into 3 Scopes:

  • Scope 1 – directly burned fuel (usually gas and heating oil plus any transport directly owned and operated)

  • Scope 2 – electricity

  • Scope 3 – everything else. Upstream (supply chains), downstream (product use, disposal, water, waste), business travel, staff commute.

Scopes 1 and 2 are usually simple to calculate as the company has the bills or metering data from the energy suppliers.

Many companies only report Scope 1 and 2 emissions — and this is all that is mandatory in the UK government’s Streamlined Energy and Carbon Reporting (SECR).

Scope 3 emissions

Scope 3 emissions include:

  • business travel

  • visitors travel

  • staff commute

  • purchased goods and services

  • freight transport

  • water and waste

  • use of any goods and services created

  • final disposal of products

Reporting on Scope 3 emissions is patchy. Some companies only consider business travel as their Scope 3 emissions. Most analysis misses out ‘purchased goods and services’ completely — even though this usually accounts for 90% of emissions. Better guidelines are constantly being formulated.

How do I measure?

Measurements of gas, other fuels and electricity is usually through billing data. Where this is unavailable (due to landlord tenant issues and service charges) they can be estimated.

Business travel usually comes from the finance department — invoices for fuel for company cars or payments for air travel. Air travel spreadsheets must include type of ticket (business class, premium, economy, etc.) and be explicit about whether they are 1 way or return (often unclear from company data). Staff commute can be estimated of come from staff surveys.

Purchased goods and services is the most tricky (and largest) area of emissions:

  • purchased goods can come from specific tonnage of goods purchased combined with available databases of the carbon emissions per unit weight — this is usually appropriate for companies with very large purchases of a small number of specific goods (aw materials for manufacturing for example)

  • services are usually handled by looking at databases of emissions per £ spent in various sectors of the economy (there is little other way to do it) — the sectoral method

  • goods are usually handled in the same way

The sectoral method can use data from the government SECR guidance (Annex E, link below) —inflation weighted. This is the easiest and quickest method without getting involved in Life Cycle Analysis and particularly appropriate when companies may have thousands of line items on their purchasing spreadsheets.

Many emissions factors come from the government's spreadsheets.

What do I need it for?

Emissions reporting on Scope 1 and 2 is needed for SECR. Mainly it is used to indicate a willingness for a company to engage in environmental issues. If a company wants to go further than report – make reductions or go carbon neutral — the carbon auditing is the first task.

Where can I find detailed guidelines?

SECR guidelines cover many of the issues — except how to do the calculations.

The ISO 14064 standard tells a company what they have to report but not how to do it, and it costs £100 or so.

The GHG Protocol is the most detailed — literally thousand of pages of how to guides

This is the standard one for companies.

And a Scope 3 specific document. Pilio can help you navigate this minefield with our carbon accounting software and our consultancy services.


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