As the urgency to address the climate emergency heightens, businesses are coming under increasing pressure to monitor, report and reduce their energy use and carbon emissions to meet net zero targets.
As a result, there is an increase in regulations to ensure that companies are taking the climate emergency seriously and not pay lip service to climate action.
During September, we’ll be taking a look at a few of the latest regulations that may affect your organisation, including:
In this episode, Mel Blackmore breaks down what Streamlined Energy and Carbon Reporting (SECR) is, its reporting requirements, it’s qualifiers and how it can work in tandem with other carbon management initiatives.
You’ll learn
- How do these regulations relate to ESG reporting?
- What is Streamlined Energy and Carbon Reporting?
- What are the SECR Emissions Reporting Requirements?
- Who qualifies for SECR?
- How can SECR work with other carbon management initiatives?
Resources
In this episode, we talk about:
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[02:10] Episode summary: Over the course of September, Mel will be exploring the latest climate change regulations that may affect your organisation. In this episode she dives into Streamlined Energy and Carbon Reporting (SECR).
[03:20] How do these regulations relate to ESG reporting? – ESG requirements include a commitment to sustainability, and reducing your overall impact. All of these regulations contribute towards an organisations ESG reporting requirements, as they require tangible proof to back up your ESG claims.
They will require you to provide comprehensive emissions reporting, the level of detail of which will depend on the specific applicable regulation.
[04:05] Future content to look forward to: During September Mel will look at involuntary emissions reporting schemes, but in October she will be looking into the voluntary schemes that many are already adopting as part of their Stakeholder requirements.
This will include:
[05:50] What are the SECR Emissions Reporting Requirements?: SECR has been around since April 2019, and was originally introduced to replace the Carbon Reduction Commitment Scheme.
This is a mandatory scheme, so it is a legal requirement for those that meet it’s criteria. For those that are familiar with ESOS (The Energy Savings Opportunity Scheme), it functions in a very similar way.
This scheme isn’t solely focused on reporting energy usage and carbon emissions, it’s also looking for organisations to report on efficiency measures that are undertaken on an annual basis. Which is reflected in the financial reporting that you will also have to submit.
It’s important to note that SECR has specific requirements for the disclosure of greenhouse gas (GHG) emissions and energy consumption. Emission reporting requirements vary slightly between quoted companies and large unquoted companies and LLPs.
For quoted Companies:
- Global Scope 1 and 2 GHG emissions must be reported. Scope 3 emissions reporting is strongly recommended but voluntary.
For large unquoted companies and LLPs:
- UK based Scope 1 and Scope 2 emissions and associated energy consumption. Scope 3 emissions from the combustion of fuel in vehicles or equipment not owned by the company.
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[12:05] Who qualifies for SECR?: All UK Quoted Companies: Any company that has shares listed on the UK Stock Exchange is required to comply with SECR.
Large Unquoted Companies and Large LLPs: These are companies and Limited Liability Partnerships (LLPs) that are not listed on the UK Stock Exchange but meet two or more of the following criteria:
- Turnover: More than £36 million per annum.
- Balance Sheet Total: More than £18 million.
- Number of Employees: 250 or more employees.
These criteria ensure that SECR framework targets large organisations that have a significant impact on the UK’s energy consumption and carbon emissions. By complying with SECR, these organisations can contribute significantly to the UK’s sustainability goals.
[14:10] When is the SECR disclosure made? SECR reporting must occur alongside financial reporting, being included within annual reports and Directors’ Reports, which are then filed with Companies House.
[14:30] The importance of Accurate SECR Reporting and Carbon Reduction – The reporting process can unlock valuable insights and opportunities for operational improvements, leading to enhanced energy efficiency and reduced carbon emissions over time.
Demonstrating your organisation’s commitment to energy efficiency and carbon reduction can enhance brand perception and foster positive relationships with stakeholders, including investors, clients, and regulators.
[16:05] Integrating SECR Reporting with Other Carbon Management Initiatives – You are missing a trick if you’re keeping your SECR reporting separate from the rest of your business activities. It should be included as a part of your sustainability umbrella, and can be invaluable if you’re going for other reporting requirements such as EcoVardis and CSRD.
There’s no need to reinvent the wheel if you already have something like an Environmental Management System in place, simply weave the additional requirements in with your usual annual maintenance. Established systems will already be adhered to across the business, meaning any new requirements will soon become business as usual.
You could incorporate this as part of your Net Zero strategy, or Carbon Reduction Plan if PPN 06/21 is one of your reporting requirements. You could also incorporate this into your supply chain emissions reporting.
If you would like some help with SECR, please get in touch with Carbonology.
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Sustainability has become a top topic to address in the last few years, both for businesses and individuals. In fact, 90% of business leaders think sustainability is important, but only 60% actually have a sustainability Strategy.
The demand for tangible action is becoming more pressing as we inch close to the 2030 milestone of the Paris Agreement.
To encourage action from businesses, we’re seeing more public and private sector contracts include a tendering requirement to show your commitment to sustainability. One such example is the need for a PPN 06/21 Carbon Reduction Plan.
In this weeks’ episode David Algar, Principal Carbonologist® at Carbonology, joins Mel to explain how to create a Carbon Reduction Plan, shares some top tips on presentation and how Carbonology® can support you.
You’ll learn
- How to create a Carbon Reduction Plan
- How Carbonology® can help you align that plan with ISO 14064 and PAS 2060
- Addressing difficult tendering questions
- How to best present your Carbon Reduction Plan
Resources
- Carbonology
- Book a call with David Algar
- A quick Guide to creating your PPN 06/21 Carbon Reduction Plan
In this episode, we talk about:
[00:24] What are PPN 06/21 Carbon Reduction Plans? – Go back and listen to our previous episode to learn more.
[00:42] Episode Summary – Today we’ll be talking about how to create a Carbon Reduction Plan (CRP), how to deal with difficult tendering questions and the best ways in which to present your CRP.
[02:46] How do you actually calculate the emissions? We have gone into this in a lot more detail on a previous episode, but to summarise:-
Emissions are calculated by taking your activity data, such as kWh of electricity, or miles driven in a vehicle, and multiplying it by an emission conversion factor.
Specific emission conversion factors are available from DEFRA for specific activity data, they are also year-specific.
The hard part is sourcing your activity data, accounting for missing information, performing estimates, and ensuring the overall methodology is accurate.
This is all done in alignment with ISO1464-1, as well as the PPN guidelines, so one of the very first things we’ll do with you is define your organisational and reporting boundaries,
[05:27] How can a business set carbon reduction targets and forecast emissions? This is tricky as it involves trying to predict the future, not just in the short term, but potentially several decades ahead depending on your goal.
The good thing is you know the end destination of your carbon pathway: little to no emissions by 2050.
Using this and some simple maths you can at least map out where you should be each year when moving forward from the base year, the base year being the period you use to compare future results against.
Usually the base year is the first year you complete calculations, but this can change over time. We’re finding some clients are opting to change their base year to account for the disruption of COVID-19 on operations
[06:40] How do you actually set the targets?: When we look at target setting and emission forecasts we generally take 2 approaches:
Milestones:
- The first, and our most common approach, is about setting milestones based on specific carbon reduction initiatives the business can implement, at specific dates.
- For instance, all company vehicles being hybrid by 2025 and fully EV by 2035? Or what if we phased out gas by a certain date? Or cut out all single use plastics?
- Using this milestone method for the forecasting can be tricky, but you can end up with a carbon pathway that is more representative of real life.
Straight line method:
- The second is what we refer to as the ‘straight line’ method. This is a simpler approach that involves doing some simple maths to plan out your carbon targets for each year, without factoring in specific milestones or events.
- We refer to this unofficially as the ‘straight line’ method as the graph showing your carbon pathway is pretty much a straight line from your base year towards net zero, using the milestones method gives a ’bumpy’ line due to the influence of specific milestones at specific years.
[08:35] A tip for setting targets for the first time is by thinking ‘what if? This is essentially looking at the thing you’re doing now and replacing it with a more sustainable alternative. For instance, calculating what your business travel emissions would be last year if they were all completed in hybrids, or if domestic flights were replaced by train journeys.
Doing these ‘what if?’ calculations is a bit hypothetical as operations are likely to change over the years, but it still helps give you a specific target to aim for a specific GHG sources.
[10:40] How can you influence carbon reduction in areas where you have no direct control? Some areas will be out of your control, for instance if you ship goods in from around the world you can’t necessarily decide how they get to you, or if they are transported via more sustainable transport.
- One thing you can do is aim to set a good example yourself as a business
- You could also adopt the PPN framework yourself and request it from anyone that is aiming to win your business
- Another quick win is actually speaking to your suppliers. If you use a local delivery firm you could speak to them about their plans for an electric fleet, or more sustainable packaging. Or if you use a data centre, you could enquire about if is run on renewable energy sources
[13:15] But what if we are planning to grow as a business? Results are expected to fluctuate over time, so if they go up after the base year this shouldn’t impact your success or failure in your tender submission. The aim is obviously to decrease on average over time
If you know for certain that they will increase in the next few years, for instance through opening new sites, making acquisitions, or just natural growth, that’s ok.
You could pick a new base year if operations significantly change as this will give a more realistic figure to work down from. You can also use this as an opportunity to evidence efficiency improvements through intensity metrics, such as your tonnes of carbon per employee, or relative to your revenue.
[15:15] In what other ways can Carbonology help to support you? – Once everyone is happy with the CRP, you’ll then have to actually use it in tenders. The fun thing about tenders is that they can all ask different questions, despite PPN having technical requirements, so you can’t always have the information to hand before submitting one.
We can’t write your tender submissions for you, but we can provide guidance and pull out the necessary figures if requested, for instance if you need certain numbers to support with your Social Value Model reporting.
[16:20] How can this help on your journey to Carbon Neutrality? – If you’ve gone through all the hard work to create a PPN 06/21 Carbon Reduction Plan, you’ll be in the ideal position to achieve carbon neutrality of your operations via PAS 2060.
The next step would be creating a PAS 2060 Qualifying Explanatory Statement, or QES, which details how you have achieved carbon neutrality through offsetting, and your commitment to maintain this for future reporting periods.
[17:25] Where does the verification come into play? If you’ve already calculated your emissions you may be asked to have them independently verified by an independent third party.
We’ve recently developed a process so we can check over you GHG calculations, policies, procedure and overall alignment with the standard.
As part of this, Carbonology can provide a verification report with all findings and opportunities for improvement, as a well as a verification statement to show you have had emission independently verified in alignment with ISO 14064.
For further information, David has prepared a quick guide for creating your PPN 06/21 Carbon Reduction Plan. Download it from the resources area above.
Lastly, if you have an questions or would like to learn more about how Carbonology can help you, feel free to book a call in via David’s Calendly.
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This episode is Part 4 of our 7-part mini-series explaining our Carbonology service, a 7 step methodology to help companies become Carbon Neutral.
This time, our resident Carbonologist David Algar is talking through the fourth step of the Carbonology process, ‘Reduce’.
David explains how we can put our Carbon Reduction Plan into action so we can see clear tangible results in our reductions, and the benefits this brings to organisations and their employees.
You’ll learn
- How the ‘Reduce’ phase in the Carbonology process works.
- How to monitor how successful your initiatives are.
- The importance of communicating your reduction plan to your staff.
- How to get your staff excited about your carbon reduction plan.
- The value of externally communicating your commitment to carbon reduction.
- How having a sustainability group can help your business.
Resources
In this episode, we talk about:
[03:05] The ‘reduce’ phase of the Carbonology process.
[04:36] The need to make your staff aware of your carbon reduction plan.
[05:13] How to best manage communications with staff around carbon reductions.
[06:36] How a carbon reduction plan can be beneficial for an organisation and their staff.
[07:26] How to best monitor the success of your initiatives and the benefits this has.
[11:11] The benefits of reducing your carbon footprint rather than offsetting it.
If you need assistance with implementing ISO 14064, PAS 2060, or another standard – Contact us!
We’d love to hear your views and comments about the ISO Show, here’s how:
- Share the ISO Show on Twitter or Linkedin
- Leave an honest review on iTunes or Soundcloud. Your ratings and reviews really help and we read each one.
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This episode is Part 3 of our 7-part mini-series explaining our Carbonology service, a 7 step methodology to help companies become Carbon Neutral.
Our resident Carbonologist David Algar is back to talk through the third step of the Carbonology process, Commitment.
David explains how organisations can identify the type of targets to put in place, the importance of having a launch and communications plan, and shares some popular ways organisations can reduce their carbon emissions.
You’ll learn
- How organisations can set targets for their Carbon Neutrality.
- Why it’s important to make a formal commitment.
- Popular ways organisations reduce their carbon emissions.
- The benefits of changing your vehicles from diesel to electric.
- Some of the incentives to achieve emission reductions.
- The importance of having your staff involved with your plan.
Resources
In this episode, we talk about:
[02:19] How to begin the commitment stage of Carbonology.
[04:00] Why organisations need a plan to achieve PAS 2060.
[05:27] Popular ways organisations can reduce their carbon emissions.
[06:40] The approach you need to take when setting targets.
[09:30] Typical targets organisations can put in place.
[11:31] The importance of having a launch and communications plan.
[12:06] The typical outcomes and deliverables organisations will be provided.
[13:31] The expectation of businesses to have a carbon footprint management plan.
[14:19] The importance of having your staff involved with your plan.
If you need assistance with implementing ISO 14064, PAS 2060, or another standard – Contact us!
We’d love to hear your views and comments about the ISO Show, here’s how:
- Share the ISO Show on Twitter or Linkedin
- Leave an honest review on iTunes or Soundcloud. Your ratings and reviews really help and we read each one.
Subscribe to keep up-to-date with our latest episodes:
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