In the quest for a sustainable future, understanding and mitigating carbon emissions is paramount. Carbon accounting, a vital aspect of this journey, involves calculating the total greenhouse gas (GHG) emissions attributed to an organisation, product or process.
To perform accurate carbon accounting, identifying data points – and the sources from which the data originates – is essential.
Let’s take a closer look at how to decide which data points are needed for specific carbon accounting requirements and the best ways in which to collect it.
How do you know which carbon accounting data sources are relevant?
Determining relevant carbon accounting data sources for an organisation involves a structured approach, considering factors like industry, business operations and sustainability goals.
Here are some steps to take to get started:
Understand your value chain: Begin by comprehensively mapping out the organisation's structure, operations, products/services and supply chain. Consider the entire value chain – both upstream and downstream activities – and note factors such as the sector, geographic locations, types of energy used, transportation methods and waste that could be generated. To start with, focus on tier 1 suppliers, for example businesses that directly provide products or services.
Create reporting boundaries: Once you have identified all possible sources of emissions, categorise them into one of the three Scopes outlined by the Greenhouse Gas Protocol. Understanding which Scopes, and categories within, are relevant to your operations helps identify the types of data needed.
Choose a framework: Refer to established sustainability reporting frameworks, such as the Greenhouse Gas Protocol or specific industry standards, as they usually provide guidelines on the type of data that will be required for each category of emissions.
Review regulatory requirements: Understand applicable laws and regulations related to carbon reporting and emissions disclosure in the regions where the organisation operates. These regulations often outline mandatory reporting requirements and relevant data sources.
Analyse available historical data: Review historical data, if available, to identify trends and patterns in emissions. If you do not yet have any emissions data, consider metrics like energy consumption or spend on materials. Identifying the most significant emission sources and activities through a materiality assessment helps prioritise data collection efforts for areas that have the most substantial impact.
Assess data accessibility: Evaluate the availability of data from various internal and external sources, such as utility bills, transportation logs, waste records and industry databases. Prioritise sources that are feasible to obtain now and plan how to collect data in the future where there are gaps.
Investigate emerging technologies: Explore emerging technologies, such as Internet of Things devices and carbon accounting software solutions, that can automate data collection and provide real-time insights into emissions. These technologies can enhance the accuracy and efficiency of data gathering.
Engage with stakeholders: Consult internal stakeholders, sustainability teams and relevant departments (e.g., finance, operations, procurement) to understand their data needs and perspectives. Stakeholder engagement ensures a more comprehensive approach.
Continuous improvement: Keep the data collection process under review and always strive to improve it based on experience, changing organisational needs and advancements in data collection methodologies.
What type of data can be used for carbon accounting?
There are different types of emissions calculations — average-based, spend-based, and activity-based — which differ in how they approach and calculate GHGs within an organisation.
Average-based carbon accounting method
The average-based method calculates emissions by using industry or sector averages for emissions associated with a specific activity, product or service. Instead of using organisation-specific data, standard emission factors or averages are applied.
For example, modelling the emissions from an organisation’s vehicles simply from the number of vehicles owned.
This method is generally less accurate than others due to its generic nature, but it can provide a rough estimate when detailed information is unavailable or difficult to obtain.
Spend-based carbon accounting method
The spend-based method calculates emissions based on the financial expenditure or spending of an organisation. It correlates the amount of money spent with the emissions generated. This method often uses economic input-output models that link spending in various sectors to associated emissions.
For example, modelling the emissions from an organisation’s vehicles from the amount spent on petrol to power them.
This method uses financial data, which is often readily available making it useful for quick calculations. However, while it's more accurate than the average-based method, it still relies on generalised models and may not capture organisational specifics accurately. Often it is a low-quality indicator of where emissions actually are and lacks enough detail for decision making.
Activity-based carbon accounting method
The activity-based method calculates emissions by directly measuring the activities that contribute to emissions. This approach involves a detailed examination of various activities within the organisation, such as energy usage, transportation or waste production. Emission factors specific to the organisation's activities are then used for precise calculations.
For example, modelling the emissions from an organisation’s vehicles using the distance each vehicle travelled in kilometres, along with information like fuel burned and vehicle weight.
This method is the most accurate and comprehensive, considering an organisation's unique activities and utilising specific emission factors. It helps to drive better decision making when it comes to cutting carbon as it opens up a whole host of possible actions to take. However, it requires detailed data collection and can be more time-consuming and resource intensive.
Depending on the calculation method, the data sources for carbon accounting vary. Organisations typically aim for a balance between accuracy and resource investment when choosing the appropriate emissions calculation method.
Carbon accounting data source examples
Let’s dig a bit deeper into what data you may collect, broken down by Scope, and from which sources.
Scope 1 emissions data sources
Scope 1 carbon accounting involves measuring direct GHG emissions from sources owned or controlled by an organisation.
Here are some examples of sources for Scope 1 calculations:
Fuel consumption records: Records of fuel consumption for on-site equipment, vehicles, and machinery powered by fossil fuels (e.g., gasoline, diesel, natural gas).
Energy bills and usage: Utility bills and usage data related to on-site energy production and consumption, including data on the use of fuel or natural gas for heating purposes.
Heating and cooling systems data: Information about heating systems that use fossil fuels, such as boilers and furnaces, or cooling systems that use refrigerants.
Equipment and machinery data: Data related to the type and number of equipment and machinery emitting GHGs as a result of their operations.
Fugitive emissions data: Data on unintentional GHG emissions, such as leaks from systems handling fossil fuels or coolants.
Maintenance and repair records: Data related to maintenance activities that might influence the efficiency of equipment and, consequently, emissions.
Biomass combustion data: Data concerning the combustion of biomass, if applicable, as it can also be a source of direct emissions.
Chemical reactions data: Data related to chemical processes that release GHGs as byproducts, often associated with industrial operations.
Scope 2 emissions data sources
Scope 2 carbon accounting involves measuring indirect GHG emissions associated with the generation of purchased or acquired electricity, heat, steam or cooling.
Here are some examples of sources for Scope 2 calculations:
Utility bills and invoices: Records of energy consumption and costs associated with purchased electricity, heat, steam or cooling from external suppliers.
Renewable Energy Certificates (RECs): Documentation proving the purchase and use of renewable energy.
Power Purchase Agreements (PPAs): Contracts detailing the terms of purchasing electricity, particularly relevant for organisations procuring energy from specific renewable sources.
Data from on-site renewable energy sources: Information about energy generation from on-site renewable sources like solar panels or wind turbines, if applicable.
It’s worth noting that the carbon intensity of electricity can vary based on its source. Utilising region-specific data on the carbon intensity of electricity aids in accurate assessments of emissions associated with energy consumption.
Scope 3 emissions data sources
Scope 3 carbon accounting involves measuring indirect GHG emissions that occur in a company's value chain, outside of its direct operations (Scope 1) and purchased energy (Scope 2). It encompasses a wide range of activities, often making data collection complex.
Here are some examples of sources for Scope 3 calculations:
Business travel data: Records of employee travel, including flights, trains, cars and other modes of transport, specifying distances, durations and fuel consumption if possible.
Employee commuting data: Data related to employee commuting habits, such as distances travelled, modes of transportation used and frequency of commuting.
Waste management data: Information about waste generated by the organisation, including type of waste, disposal methods and treatment processes.
Water and wastewater data: Data from water use and wastewater treatment processes, including consumption and energy used for water treatment.
Supplier data: Footprint data from suppliers, including their GHG emissions associated with the production and transportation of goods or services provided to your organisation.
Leased assets data: Emissions resulting from the use and maintenance of leased assets, such as vehicles, equipment or buildings.
Franchisee or value chain partner data: Emission data from franchisees, joint ventures or other entities within the organisational value chain.
Investments and financing data: Emission data associated with investments made by the organisation, including indirect emissions from financed projects.
What data is needed to calculate a product carbon footprint?
A product carbon footprint involves measuring the total GHG emissions associated with a product throughout its entire life cycle from raw material extraction to manufacturing, distribution, use and disposal.
To calculate a product's carbon footprint accurately, various types of data are needed. Here are some of the key data categories:
Raw material extraction: Information on the type and amount of raw materials used in the production process, as well as the energy consumed during extraction and processing.
Capital goods data: Emissions related to the production and disposal of capital goods, such as machinery and infrastructure.
Manufacturing and production data: Details about the manufacturing process, including energy consumption, weight and type of materials used and the chemical processes involved.
Transportation and distribution: Data on transportation of raw materials, components, and the final product, including type of vehicles used, distances travelled and fuel consumed.
Product use phase: Data related to energy consumption or other emissions released during the use of the product, considering factors such as energy efficiency and user behaviour. These are often estimated through surveys or industry averages.
End-of-life management: Information on disposal methods, recycling rates, typical waste treatment, and the potential for reusing or recycling product components.
Product packaging: Details about the materials used for packaging, considering the complete life cycle.
Once a product footprint has been modelled, based on the above data categories, the more challenging task is allocating these emissions back to the manufacturing organisation. This is something that the xtonnes carbon accounting software enables users to do, providing product led businesses with a completer and more accurate footprint.
Reach out to our team for more information how we can help you decarbonise with confidence.
Who should be responsible for what carbon accounting data?
The responsibility for collecting, managing and reporting carbon accounting data should be clearly defined within an organisation. Assigning roles early on ensures that the process is efficient, accurate, and aligned with the organisation's sustainability goals.
Ultimately, the teams responsible for identifying and collecting various carbon accounting data points depends entirely on the organisation – a small business with less than 10 employees is likely to have a completely different approach to a company with thousands of workers.
However, here's a very generalised breakdown to give an idea of who could be responsible for what:
Sustainability or ESG (environmental, social and governance): Companies large enough to have these teams usually assign overall responsibility for carbon accounting and sustainability initiatives to them. But this team typically acts like a gatekeeper to carbon management, and often collect the data from elsewhere in the business on a regular basis.
Finance: Provide financial data that may be crucial for spend-based carbon accounting. They may also collaborate with sustainability teams to allocate budgets for emissions reduction activities.
Operations and Facility management: Often given responsibility for collecting data on energy consumption, water usage, waste generation and other operational activities contributing to emissions.
Procurement and Supply Chain management: Collaborate with suppliers to gather data on the supply chain and procurement activities. They may also help to encourage suppliers to measure and reduce their own carbon footprints.
Product management or engineers: Provide data required to calculate the footprint of a product, such as raw materials used, manufacturing processes and expected user behaviour.
Human Resources (HR): Provide data on employee travel, commuting habits and business trips, alongside educating and engaging employees in sustainability efforts.
IT and Data management: Implementing data collection systems and software for accurate tracking and reporting of carbon accounting data.
Executive Leadership: Providing support and resources for effective implementation of carbon accounting initiatives, as well as approving and endorsing public reporting of the organisation's carbon footprint and sustainability efforts.
Regardless of typical department or team roles, assigning clear responsibilities is a crucial part of successful carbon accounting. Not only does this ensure that data collection tasks are completed to a high standard, but it also ensures a collaborative effort across an organisation and leads to well-informed decision making.
How to improve carbon accounting data quality over time
Improving data quality over time is an important step for effective carbon accounting. By continuously enhancing data quality, organisations can ensure that their carbon accounting processes are reliable, transparent and aligned with their commitment to environmental responsibility and sustainable practices. Here are some tips for improving carbon accounting data quality:
Provide employee training: Educate employees involved in data collection and reporting on the importance of accurate and timely data. Raise awareness about how their actions contribute to the overall data quality and, consequently, to the organisation's sustainability goals.
Standardise data collection processes: Establish standardised procedures for collecting data across the organisation. Clearly define data collection methodologies, sources and responsibilities – through written policies and processes - to ensure consistency and comparability. Transparency facilitates understanding and scrutiny of reported data.
Carry out regular data audits: Conduct periodic audits to validate the accuracy and completeness of data. Compare data between time periods other reliable sources to identify discrepancies and rectify them.
Incorporate feedback loops: Establish mechanisms for feedback and continuous improvement based on data accuracy and reliability. Encourage employees to report discrepancies and suggest improvements in data collection processes.
Invest in carbon accounting software: Utilise specialised carbon software that facilitates data management, tracks changes, and checks data accuracy and quality. Automation minimises manual errors, improves efficiency and leads to cost savings. In addition, using tools like this ensures calculations are based on the latest emission factors and methodologies.
For more information carbon accounting data and how our software can help your business stay ahead of the curve, reach out to our team.