What are The Different Paths for Carbon Accounting?

carbon accounting

Carbon accounting, which is also sometimes referred to as “greenhouse gas accounting,” is the term that is used to refer to the methods that are used to estimate the amount of carbon dioxide equivalents that are emitted by an organization. It is typically utilized in the production of the commodity known as carbon credit(s), which is exchanged on carbon markets by various provinces, states, organizations, carbon offset companies and individuals (or to establish the demand for carbon credit prices). Carbon accounting is the foundation for a variety of goods, such as national inventories, environmental reports for businesses, and carbon footprint calculators that measure carbon footprints among other things. Therefore, carbon accounting is the process that businesses go through in order to evaluate their GHG (greenhouse gas) emissions in an effort to comprehend the climatic impacts that are associated with those emissions and to set goals for the reduction of those emissions. The World Business Council for Sustainable Development and the World Resources Institute are two organizations which offer directives and guidance with regard to the evaluation of efforts to reduce emissions as well as the accounting for greenhouse gas emissions produced by businesses (WRI). On the basis of IPCC’s published methodology reports, the regulation and the process of providing guidelines to national GHG inventories are carried out (Intergovernmental Panel on Climate Change). The following general guidelines for GHG emissions were also released by the ISO:

  • Greenhouse gas emissions from businesses: ISO 14064 – 1
  • Greenhouse gas emissions at  project level: ISO 14064 – 2
  • The specifications for checking and confirming relevant accountings are stated in: ISO 14064 – 3.

Getting to Know Carbon Accounting

A GHG emissions assessment calculates a company’s or organization’s total annual greenhouse gas emissions, including those that are not directly related to operations. Information can be used as a commercial resource and as a basis for comprehending and restraining climate change’s effects. The purpose of a comprehensive greenhouse gas (GHG) emissions assessment for a corporation is to estimate the total amount of GHGs produced internally and externally by the business within a given framework.  This data not only serves as a useful technique for firms but also as a point which better describes and defines the changes in climate and developing strategies to mitigate their impact. An evaluation of a company’s overall greenhouse gas (GHG) emissions, sometimes known as “carbon,” aims to determine how many GHGs are generated both internally and externally by its operations. It is a corporate tool used to create data that could (or might not) be useful for understanding and limiting the effects of climate change. One of the driving forces behind corporate GHG accounting is the requirement for GHG reporting in directors’ reports. Other driving forces include investment due diligence, employee participation, shareholder and stakeholder engagement, green messaging, and bid criteria for business and government contracts. It is becoming more and more commonplace for businesses to be required to account for their greenhouse gas emissions. Read More:- Easiest Ways To Reduce Your Carbon Footprint

Business Carbon Accounting (ECA)

A key element of enterprise sustainability accounting, enterprise carbon accounting (ECA) or corporate carbon footprint aims to be a quick and inexpensive method for gathering, synthesizing, and disclosing organization and supply chain GHG emissions. ECA uses a combination of input-output LCA (Life Cycle Analysis) and process approaches, where necessary, together with financial accounting requirements. The move to ECA is necessary to address the urgent need for a more complete and sustainable method of carbon accounting.

Traits of an ECA system that are successful

To be and remain effective, enterprise carbon accounting programs must satisfy the following requirements:

  • Wide Coverage: Consists of emissions from Scopes 1, 2, and 3
  • Periodic: Enables frequent updates and comparisons between reports.
  • Auditable: Records transactions and enables impartial compliance
  • Versatile: Combines data from several sources for life cycle analysis.
  • Standards-based: Supports both current, generally accepted standards and new ones.
  • Scalable: Enables a company to grow in both volume and complexity.
  • Provides information quickly enough for decision-making.

Recognizing Scope Emissions

An efficient ECA system must have a number of key components in order to function well. One of these components is a detailed report of the various emissions, which must be categorized as Scope 1, 2, and 3. Scope 1: Emissions from a firm’s direct operations, such as combustion processes in buildings and vehicles that the company owns or controls, are included in this scope. Scope 1 also has the broadest definition of all three scopes. Scope 2: Those emissions that are produced as a result of purchased energy used by an organization comes under this criteria. Examples of purchased energy include steam and electricity purchases, as well as heating and cooling systems. Scope 3: Emissions coming from any other extra indirect sources of emissions in a company’s supply chain are included in this scope. For example, purchased raw materials, logistics and distribution, travel expenses for employees, consumption of sold items, and end-of-life cleanup are all examples of emissions that fall under this scope.

Climate Carbon: A New Beginning

When you make a purchase of carbon offsets from “Climate Carbon,” you may have peace of mind knowing that the carbon offset projects you are supporting are of the highest possible standard. Your carbon footprint can be reduced by participating in programmes like reforestation, landfill gas capture, and farm power, all of which have the goal of removing carbon from the environment. This will help to lower the impact of the carbon emissions that we all produce on a daily basis. Carbon credit value is high when considered for environmental protection. Each carbon offset price contributes a portion of its value to the funding of research and development of new technologies that reduce emissions and store carbon. Climate Carbon has developed its very own carbon footprint calculator in an effort to cut down on carbon emissions. This tool gives you the ability to estimate and evaluate your personal carbon footprint based on your lifestyle choices.