Even just a few decades ago, it would have been almost unheard-of for investors and shareholders to pressure firms into going greener, but in recent years, the phenomenon has become more common.
Yet with ever more dire warnings coming from the scientific community and more pressure from shareholders, investors, and the public for individual companies to take green initiatives seriously, many are accepting the challenge. Despite even the best of intentions, looking into the carbon impact of your business can be overwhelming. Often, the more you look, the more you find.
So where should you even begin? You will need to consider your timeline. With most consultants, you will want to start your discussions and collaborations six to twelve months before your target date for a completed review. Beginning early and discussing the data you will need to compile with your selected consultant can speed up the overall process and ensure you and the consultant work at maximum efficiency.
As you begin the process, you must evaluate your business by answering a few questions:
- How much energy are you using?
- Where does that energy come from?
- What is the indirect carbon impact of operating your business?
STEP 1: Evaluate your on-site carbon impact
So where do you start? Begin with something straightforward: your energy bills. Compile and review at least the last twelve months of energy bills, including electric, gas, heating oil—if applicable—and any other utility, such as hot or chilled water, or steam. Reach out to your providers to request your past bills, and ensure you discuss with your consultant which data points are important to extract from these bills.
Not all these bills are so straightforward, however. For instance, you may have an on-site generator that kicked in over the summer when the power went out. Have you included in your review what kind of fuel the generator uses, how much has been consumed, and whether you purchased reserves to store on-site?
At this time, you should also start to compile additional information relating to company expenditure. You can start to request and compile bills or data related to:
- Company-owned vehicles
- Food service providers
- Business travel
- Leased assets
- Employee commuting
- Office supplies and components (e.g. desks, computers, monitors, etc.)
As you continue to review your company’s carbon impact, more details from these bills will become important. While in Step 1 the crucial components are how much energy, fuel, or water your company used, in Step 2 the source of each will become important, and in Step 3 you will examine more of the indirect carbon impact of running your business. This process takes time and resources, however. You should build in time for both external and internal reporting to be completed. In addition, early communication with your consultant can help ensure you compile all the necessary data points from the beginning.
This is where a thoughtful review of your record-keeping can be most valuable. As you start to compile information, do you have the data you need to inform a review of your carbon emissions? This type of data is often not what most companies track. For instance, bills from food service providers are usually reviewed for total cost, but do you know the total weight of food delivered or its source? While accounting usually only needs total cost, for the purposes of evaluating carbon impact, you will need additional data points for accurate calculations. With good internal communication between teams, you can begin to build carbon data tracking into your record-keeping processes.
Two additional components of your on-site carbon impact: fugitive emissions and company-owned vehicles. Fugitive emissions are most often given off by refrigerants, but you may find other equipment used on-site may be producing these greenhouse gasses. Your consultant can help you review your on-site equipment inventory to identify potential emitters and inspect them.
The impact from any company-owned vehicles should also be considered as part of Step 1. Review the vehicle types and fuel consumption. Does your company own only electric vehicles? How much electricity has been consumed as a result? If you use hybrids or traditional combustion engine vehicles, how much fuel has been consumed? Do your vehicles run off of diesel fuel? Are traditional vehicles regularly inspected to ensure they meet federal emissions standards? Review any submitted requests for fuel reimbursement, and ensure you identify the types of vehicles owned.
Data-gathering is the most crucial step in the process, as it sets up the information for all the ensuing steps. Good data may be hard to find, but it is a veritable gold mine as you navigate this process. This is the first crucial step you must take on your journey to carbon neutrality.
Step 2: Review your energy usage and sources
This second step has three key components:
- Understanding where your energy comes from
- Understanding how you use that energy
- Identifying how you can use energy more efficiently
As you move through the process of going carbon neutral, this step will help you identify the problems your company faces in this arena, and allow you to begin some initial steps to reduce energy usage.
Where does my energy come from?
Energy providers are more aware than ever that many consumers care about where their electricity comes from. In addition, there is an ever-increasing supply of green electricity, whether it be from wind, solar, or water, among others. While many consumers simply passively receive energy from their provider, some now allow consumers to call and request that their electricity come from green sources.
Identifying the source of your electricity is usually straightforward: contact your energy provider. However, there can be complications, particularly for property owners or lessees in older metro areas. In New York City, Boston, Philadelphia, and even Denver, to name a few, some buildings run off of city steam. While this is an antiquated way of getting your energy, it may be something you will need to address with your energy provider.
How do I use energy?
While you work with your energy provider to identify the source of your electricity, you should also work with your consultant on an energy audit. If you plug it in, this is where you evaluate its energy consumption. This review of your energy usage is building-specific, and identifies areas of high usage. These could be HVAC systems, refrigeration, or other major appliances, or it could be as simple as identifying high energy consumption due to computer usage.
The key here is not to jump to solutions just yet. At this stage, you are still identifying any potential problem areas—areas where you currently use more energy than needed. Until the problem areas are identified, you could actually waste time and money solving non-problems. Many consultants like EBI see clients assuming they know their problem areas, but until an evaluation of your energy consumption is complete, that HVAC system you blame for your large bill may or may not be to blame.
How can I more efficiently use energy?
There are certainly quick steps you can take to minimize energy usage—such as replacing older appliances with Energy Star certified models or verifying your equipment is high efficiency rated—but you want to avoid throwing money at a problem when it could be more efficiently spent. The main goal of an energy audit is to identify problem areas and suggest appropriate measures to mitigate energy usage.
While you want to avoid starting with solutions before an audit reveals the true problems, once the audit is complete, you can begin to take the first steps in your carbon neutral journey. With the information from your energy audit, you should now know where your primary problem areas are, and have an initial game plan worked out with your consultant on how to begin addressing these issues. Collaboration and good communication with your consultant are crucial throughout this process, but here in particular. To create a plan that addresses your firm’s concerns and fits your goals, both you and your consultant will need a clear view of your exact concerns and goals.
With your initial plan in place, you are ready to proceed to Step 3.
Step 3: Identifying your business’ overall carbon impact
In this third step, you will start to evaluate the indirect emissions created in your value chain, including both upstream and downstream emissions. These are often the largest source of emissions, require a deep dive into how your business operates, and can be overwhelming, but this is also the point at which companies identify the most significant opportunities to reduce greenhouse gas emissions and minimize their carbon impact.
The big question you need to ask in this step is, “What goes into operating this business?” However, this is comprised of two general groups: employee travel and/or commuting, and business operations. The richer the understanding of these two components, the more accurate—and therefore the more valuable—your consultant’s evaluation of your existing carbon footprint.
Key to the success of this third step is a deep understanding of your business and how you operate. With 15 possible categories to review, your consultant must understand which apply to your business and how they apply. Step 3 is the most highly customized, as your consultant works with you to understand every aspect of your day-to-day operations.
Travel and Commuting
While evaluating this portion can be intensive from a data-gathering perspective, it is also the most straightforward aspect of this third step. To get an accurate picture of the carbon impact of employee travel, you must ask:
- Where are our employees commuting from?
- What vehicles are they using to get to work?
- How often do employees travel for business purposes?
- What mode of transportation is used for business travel?
- Are there predictable patterns to employee business travel?
Employee commutes can certainly be varied, so for many firms and consultants, your best efforts here produce a highly educated best guess. However, start to consider how many employees travel to your site(s). Do they all work out of your offices? Do some work remotely? Do they work remotely for a certain percentage of their time, but still commute to the office? How often do remote employees commute? The more you interact with your employees to determine their commute patterns, the better your data for this segment.
Review reimbursement requests to evaluate business travel. You may discover that you can identify patterns of travel, and use that to predict not only your current carbon footprint, but anticipate future carbon impact, as well. As an example, your CEO may travel out of state regularly for a specific, recurring meeting. Other employees may be tapped every year to attend specific conferences. As you look back, you may identify any number of predictable patterns to help you understand the annual carbon impact from your employees’ travel.
As you look at your day-to-day business operations, there are a few questions you should ask as you begin.
- Do you produce something?
- What goes into creating your product?
- What raw materials do you use?
- How are materials transported to/from your facility?
- What goes into daily operations?
- How do you source office supplies?
- Do you create mass orders of anything regularly?
- Do you serve food on-site? How much? Where is it sourced?
These questions form just the beginning as you start to think through each component of the day, from the time an employee arrives to the time they leave, and from the time service providers arrive to the time they leave. Leverage your internal systems, such as inventory management systems, to begin compiling the data around your operations. Try to consider every aspect of the day, from staplers to computers and monitors to lunch time and the coffee bar. Each facet will bring to life a new consideration for your overall carbon footprint.
The Big Picture
There are 15 total categories to evaluate within this third step, including:
- Employee commuting
- Business travel
- Purchased goods and services
- Capital goods
- Fuel and energy-related activities
- Upstream transportation and distribution
- Downstream transportation and distribution
- Waste generated in operations
- Upstream leased assets
- Downstream leased assets
- Processing of sold products
- Use of sold products
- End-of-life treatment of sold products
You and your consultant will work collaboratively to evaluate each and determine which apply most directly to your business. Consultants must highly customize Step 3 to fit the business and goals of your firm, and therefore to get the most accurate assessment possible of your firm’s greenhouse gas emissions.
So where do you start? What is most important as you look to begin a journey towards carbon neutrality?
1. Start by thinking ahead
This process can be time-intensive. You will need to gather a large amount of data from a wide range of sources, both internal and external. While wrangling internal sources can be difficult, sometimes external sources can be even more so, especially if they are unused to these types of requests. Budget out a realistic timeline, beginning by speaking with your consultant. An experienced consultant can help you develop a reasonable timeline for your initial evaluation of your firm’s carbon impact.
2. Data is key
As you partner with your consultant and work with your internal and external sources to gather the data needed, you will need to both review your current record-keeping processes for their ability to track carbon-related data, and ensure the accuracy of that data to the best of your ability. Speak with your consultant early on about exactly what data points you will need and from which sources. Experienced consultants will be able to help you parse through your sources and the data points each will be likely to provide.
Unfortunately, understanding exactly how much greenhouse gas emissions your firm contributes is difficult to determine with a high level of accuracy. So many variables come into play, and there are many aspects in which, no matter how much data you compile, at the end of the day, you and your consultant must deliver your best, most educated guess. This data helps you determine the hotspots—the areas of largest emissions—and therefore the most effective places to begin taking steps to minimize carbon impact.
3. Start by identifying the problem
Each of these three initial steps clarifies the picture of your current carbon footprint. By the end of the process, you should understand where the problems lie, and have an initial plan in place to begin minimizing carbon emissions. Until the problem areas are clear, no matter how well-intentioned, you may very well be throwing money at areas with little impact on your carbon footprint, or you may be treating only a symptom, not the root cause.
Collaborate with an experienced consultant to ensure you get the clearest picture of your business’ carbon footprint.
EBI Consulting’s team of energy and sustainability professionals works with a wide-ranging field of clients, helping them as they evaluate their options and undertake projects to help their firms go greener. Our experts work collaboratively with clients, allowing their concerns and goals to drive the process while providing valuable, experience-based insights.
EBI is on a mission to redefine consulting services by delivering forward-looking, high quality, and actionable intelligence that provides the insights you need to be successful in your journey to carbon neutrality. Let our nationwide team of engineers and consultants provide the insights you need to meet your goals.
About the Author
Mike Eardley, Director of Energy and Sustainability. Mike Eardley joined EBI Consulting in 2018 as the Director of Energy and Sustainability and has more than 20 years’ experience in energy consulting, commissioning, and mechanical engineering. Mike’s professional industry experience spans higher education, healthcare, laboratory, K-12, and government facilities. He is a professional engineer in Massachusetts and Maine, LEED accredited in building design and construction, and a certified commissioning professional.
Mike has a Bachelor of Science in Mechanical Engineering from the University of California at Berkeley and a Master of Science in Architectural Engineering from the University of Colorado. He is affiliated with the Building Commissioning Association, the Building Commissioning Certification Board, US Green Building Council, ASHRAE, and the Association of Energy Engineers. He works out of EBI’s Burlington, MA headquarters.