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In this, the second article of a four-part series, the process for calculating an organization’s carbon footprint is provided. For more information on this topic, see these related articles:

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• How to Calculate a Carbon Footprint - Part 1
• Glossary of Common Climate Change Terms
• Climate Change Emission Factor Resources

Phase I: Defining the Carbon Footprint

According to the primary resource for carbon footprinting, the GHG Protocol, there are specific boundaries that need to be drawn around each inventory. Decisions include

• What locations will be surveyed.
• When the company will begin capturing and recording its emissions.
• Which emissions sources are associated with each aspect of the business.

The activities listed below should be conducted.

1. Define GHG Inventory Parameters

• Identify your project team - include representatives from facilities management, accounting, corporate relations, and environmental management, as appropriate.
• Determine which of your organization’s locations will be included in or excluded from the inventory. There are two primary approaches used to select the organizational boundary: equity share or control (financial or operational criteria). Most companies choose to follow the operational control approach, which means that the GHG inventory will include any facility over which it has the authority to manage and implement operating policies.
• Select the most appropriate base year for the inventory, based on data availability. This does not have to be the current year and can be retroactive, but it must include complete data for a full calendar or fiscal year.

2. Identify Scope 1, Scope 2 and Scope 3 Emissions Sources

• Each location and operational unit will have emissions sources associated with it, including electricity (kWh), fuel (gal, ccf, BTU), and refrigerants (kg, lb). It is important to carefully evaluate all emissions sources and categorize emissions sources them as Scope 1 (direct), Scope 2 (indirect), or Scope 3 (other indirect). See examples below.

• Identify how data are kept for each emissions source and who is the primary owner of each data type; possible sources of emissions usage data include invoiced utility bills, travel logs, expense reports, and contracted service or maintenance records.
• Create a flow chart of data owners:

If your company’s operations extend beyond typical office space or simple manufacturing, be aware of hidden or unusual emissions sources, such as SF₆ at power transformers, CH₄ at anaerobic wastewater treatment facilities, or other process emissions from chemical or material manufacturing.

Phase II: Quantifying

Now that the basic inventory parameters have been defined, it is time to collect data and calculate your corporate footprint.

3. Collect Source Data and Determine Data Gaps

• Collect emissions source data from identified data owners by distributing data reporting templates, through automated database downloads, or via one-on-one communication. This is frequently the most time-consuming part of a GHG inventory, so be sure to schedule accordingly.
• Assemble the data for each emissions source by month or invoice period, facility type, and location type to determine whether there are areas where key information is missing. Missing information is an expected outcome, especially when undergoing the inventory exercise for the first time.

4. Estimate and Model Missing Data

• If there are information gaps after uploading a database, try to fill in data by going back to source documents (e.g., invoices), making a second request of data holders, and checking for additional data sources.
• Develop a modeling approach for missing data that is based upon existing corporate or industry data sets. For example, the Commercial Buildings Energy Consumption Survey provides average utility usage estimates by square foot for office space. Company-specific models can also be developed using samples of data from similar emissions sources.
• Produce a complete set of usage data for each emissions source.

5. Conduct Quality Assurance Procedures

• Review each emissions source for accuracy by spot checking manually entered data against original records, plotting categories of data to locate outliers, identifying duplicate values, and assessing unexpected seasonal data trends.
• Usage data should also be benchmarked against internal or external data norms as appropriate (e.g., average kWh consumption per square foot of office space).
• Combine all collected and modeled information into a centralized database sorted by emissions source.
• Standardize data for dates, facility identifiers, location information, North American Electric Reliability Corporation (NERC) regions, and other key characteristics. Following integration, conduct an additional quality assurance review to ensure that information was properly migrated from source files and that no inaccuracies were introduced. See the example of an electricity data spreadsheet below.

6. Calculate GHG Emissions

• Collect all relevant unit conversion factors and emissions factors for storage in the emissions inventory database. A list of resources for emissions factors and calculating tools, including the U.S. EPA (Climate Leaders, eGrid, etc.), Intergovernmental Panel on Climate Change (IPCC), and World Resources Institute (WRI), is available in the companion article “Climate Change Emission Factor Resources.”
• As a general rule of thumb, a quantity of consumption (fuel, electricity, etc.) is multiplied by source-specific factors in order to obtain the emissions of each greenhouse gas. For example, stationary and mobile combustion emissions factors for diesel fuel vary depending on the use of that fuel.
• Convert the consumption quantities for each source to a common unit that is compatible with the emissions factors available (e.g., kg CO₂ per BTU of natural gas).
• Following conversion, multiply the identified emissions factors by the quantity of consumption to calculate total emissions for each of the six GHGs.
• Apply global warming potentials to the non–carbon dioxide gases to convert them to carbon dioxide equivalents (CO₂e). The result of this process is a full set of GHG emissions by emissions type, fuel type, and emissions source. The figure below shows how initial usage data are manipulated to arrive at the final corporate inventory.

• Sample Calculation:
  • Facility A used 100,000 kWh in 2008
  • Facility A is located in Richmond, VA

7. Create an Inventory Management Plan and Summarize Results

• Determine reporting needs: internal, external, voluntary registries, retailer questionnaire, etc.
• Create an Inventory Management Plan (IMP) to document and institutionalize the GHG inventory process. Use available resources to ensure your IMP includes all relevant information. The U.S. EPA Climate Leaders and The Climate Registry both provide guidance:
  • U.S. EPA Climate Leaders: Inventory Management Plan Checklist
  • The Climate Registry: Inventory Management Plan
• Use your database to report emissions data at varying levels of granularity and in various formats.
• The completed inventory database will serve as a benchmark tool and may need to be updated if your company downsizes or acquires new facilities. It is an extremely effective way to understand how your company is spending money on energy, fuel, and resources, and it will provide transparency into your carbon risks.

The final product is a complete carbon footprint of your corporate emissions that can be shared with customers, supports voluntary reporting, shows where you stand in the emerging carbon market, and serves as a benchmark for current and future carbon management efforts. A well-constructed GHG inventory will not only provide insight into the sources and magnitudes of emissions, but will also clearly associate emissions, energy use and financial information. You can use these findings to see where your organization is overspending on energy and look for reduction opportunities. Going forward, an annual carbon footprint will help you measure the progress of your climate change strategy against your baseline emissions.

About the Author

Kyle Tanger is the founder of ClearCarbon, experts at measuring, managing and monetizing carbon. He has more than 14 years of carbon and energy expertise, having managed the complex greenhouse gas (GHG) inventory efforts of several multi-million dollar companies with combined GHG emissions totaling well over 150 million tons. In 2007, Kyle led supply chain carbon footprint analyses for Wal-Mart’s supply chain initiative pilot in conjunction with the Carbon Disclosure Project (CDP), and he continues to work closely with Wal-Mart on its Sustainability Index. Kyle has performed dozens of carbon lifecycle assessments for individual consumer products as well as larger supply chain analyses.

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