Developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), the two new GHG Protocol standards – the Product Life Cycle Accounting and Reporting Standard and the Scope 3 (Corporate Value Chain) Accounting and Reporting Standard – provide methods to account for emissions associated with individual products across their life-cycles and of corporations across their value chains.
Jonathan Lash, president of WRI, said, “We are encouraged by the overwhelming response from the private sector seeking to road test the new standards. There were more than 120 applications across a broad array of sectors and regions worldwide. The road testing will provide critical input in ensuring that the standards generate credible and meaningful data for business and government decision makers, while considering the practical challenges that businesses and programs will face during implementation.”
“Increasingly, companies are looking beyond their own boundaries and developing strategies to reduce GHG emissions in their supply chains and in the products they make and sell,” added Bjorn Stigson, president of WBCSD. “By taking a comprehensive approach to GHG measurement and management, businesses and policymakers can focus attention on the greatest opportunities to reduce emissions within the full value chain, leading to more sustainable decisions about the products companies buy, sell, and produce.”
While many companies have been measuring the emissions from their own operations and electricity use, the Scope 3 Standard will, for the first time, allow companies to look comprehensively at the impact of their corporate value chains, including outsourced activities, supplier manufacturing, and the use of the products they sell. Road testers of the Product Standard will measure the climate change impact of products ranging from magazines, food and jeans to computers, wind turbines and steel.
Ashley Crepiat, environmental footprint and economics manager for road-testing company Airbus, said, “Managing the transition towards a low-carbon economy is now a true concern for corporations. Airbus understands that beyond reducing its direct GHG emissions from its operations, evaluating emissions throughout the whole value chain is also a major challenge. By road testing GHG Protocol’s Scope 3 Accounting and Reporting Standard, we believe this will help establish harmonized international guidelines enabling a common and robust framework for Scope 3 accounting.”
Michael Kobori, Levi Strauss & Co.’s vice president of Social and Environmental Sustainability, said: “Levi Strauss & Co. is thrilled to be road-testing the GHG Protocol Product Life Cycle Accounting and Reporting Standard. If this method becomes widely accepted, it will enable us to better calculate and share the climate change impact of our products. Being able to credibly measure and communicate that product impact to consumers can unleash the power of the market to address climate change on a global scale.”
The draft standards were developed over the last year through a global, collaborative multi-stakeholder process, with participation from over 1,000 volunteer representatives from industry, government, academia and non-governmental organizations. The road testing process will provide real-world feedback to ensure the standards can be practically implemented by companies and organizations from a variety of sectors, sizes, and geographic areas around the world. The final standards are scheduled to be published in December 2010.
Companies participating in the road testing represent 17 countries from every continent and more than 20 industry sectors. The companies include: 3M Company; Acer Inc.; Airbus S.A.S.; AkzoNobel; Alcan Packaging; Alcoa; Autodesk, Inc.; Baoshan Iron & Steel Co. Ltd.; BASF SE; Belkin International; Bloomberg LP; BT Plc; CA, Inc.; Coca-Cola Erfrishungsgetränke AG; Colors Fruit SA (Pty) Ltd.; Deutsche Post AG; DuPont; Eclipse Networks (Pty) Ltd.; Ecolab; The Estee Lauder Company; Ford Motor Company; General Electric; U.S. General Services Administration; Gold’n Plump Poultry LLC; Highways Agency (UK); Hydro Tasmania; IBM; IKEA; Italcementi Group; JohnsonDiversey, Inc.; Kraft Foods; Lenovo Corporation; Levi Strauss & Co.; Mitsubishi Chemical Corporation; National Grid; Natura Cosméticos; New Belgium Brewing Co.; Otarian; Pinchin Environmental Ltd.; PricewaterhouseCoopers (Hong Kong); Procter & Gamble Eurocor; Public Service Enterprise Group, Inc.; Rogers Communications, Inc.; SC Johnson; Shanghai Zidan Food Packaging & Printing Co., Ltd.; Shell International Petroleum Company Ltd; Swire Beverages (Coca-Cola Bottling Partner); TAL Apparel Limited; Tech-Front (Shanghai) Computer Co., Ltd./Quanta Shanghai Manufacturing City; Tennant Company; Veolia Water; VT Group Plc; Webcor Builders; Weyerhaeuser Company and WorldAutoSteel.
Friday, January 22, 2010
Greenhouse Gas Protocol - Product Life and Scope 3Standards
Tuesday, January 19, 2010
McDonald's Studies U.K. Cow Emissions
Tags: Reduce Emissions, Supply Chain
McDonald's U.K. is starting a three-year investigation into its cows' methane emissions and the best methods for lowering their impacts.
The Guardian reports that the E-CO2 Project, a consultancy that provides energy and carbon assessments for farmers and growers, will study the methane emissions from cows at 350 British farms.
The E-CO2 Project will use a greenhouse gas calculator accredited by the Carbon Trust to monitor emissions and provide suggestions on ways to reduce emissions.
If the study in the U.K., where McDonald's sources beef from some 350,000 cows, is successful, the company will roll it out in Europe.
Taiwan to promote carbon footprint labeling system
| Central News Agency 2010-01-18 05:26 PM | ||
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Monday, January 18, 2010
Reducing Carbon Along The Supply Chain
Reducing Carbon Along The Supply Chain
A case study of Catalyst's Cooled paper analyzed carbon emissions in the supply chain -- from forest to printer.
In 2007, Catalyst Paper Corporation approached Wenner Media Group, publisher of Rolling Stone, with a proposal to print the magazine on paper that adds no carbon dioxide to the atmosphere through the manufacturing process.
After conducting its own research and working with WWF Canada and other parties to examine the benefits of the new product, Wenner agreed.
As researchers interested in the link between forest products and climate change, we were intrigued by the story of Catalyst Cooled paper. We decided to measure carbon emissions along its supply chain -- from harvesting the fibre to printing the magazine.
But once we started, we soon realized quantitative data was only part of the picture. There was much more to be gained from a broader look at how the companies along this particular supply chain were addressing the issue of carbon, and the potential this has to reshape business today.
The data showed basically what we had expected -- 41% of the total carbon emissions came from the actual paper manufacturing process. The rest is associated with harvesting the fibre on northern Vancouver Island and moving it to the sawmill (12%); sawmilling (10%); trucking the chips to the paper mill in Port Alberni (2%); transporting the paper to the print facility in California (28%); and printing the magazine (8%).
We then interviewed senior managers in the six companies along this supply chain and found agreement that carbon is a cost, a potential risk, and an opportunity.
Carbon is a convergence point
That's not a surprise when you consider that carbon has emerged as a convergence point in sustainability, in business operations, and in supply chain collaboration. Unlike any other measure, carbon exists in all three realms of sustainability. It is synonymous with the cost of energy so it can be economically sustainable. It has a direct impact on climate change so it can be environmentally sustainable. Its increasing value gives forest users another choice in land-use decisions so it can be socially sustainable.
There are two ways carbon efficiency may manifest along supply chains: companies that are energy efficient may become preferred suppliers, and supply chains themselves may reorient around minimizing carbon emissions. We saw both with the Catalyst case study.
Wenner chose Catalyst Cooled paper because of its environmental attributes. Catalyst was able to offer a manufactured carbon neutral paper because it has done a lot to lighten its environmental footprint; since 1990, it has reduced its greenhouse gas emissions by 70%.
The other companies along the supply chain clearly saw opportunities for their own businesses. Washington Marine Group began carbon management planning when it learned Catalyst -- its largest customer -- was exploring carbon-light products. It recognizes the potential strength of sea-based shipping, and is looking for ways to reduce its emissions, such as lowering vessel speeds to burn less fuel.
The same is true for Burlington Northern Santa Fe. This rail company has close to 50,000 kilometres of track in the United States, and sees a low-carbon economy as a prime opportunity to enhance its share of the shipping business. One tonne of freight shipped by rail uses one tenth as much fuel as a truck.
Adapting to carbon markets
As companies start to consider the carbon implications along their entire supply chain, we may start to see a change in practices. Emphasis may shift from delivery time and delivery costs to carbon-efficient delivery.
Also, location considerations differ. Here's an example: A client who wants to reduce the carbon footprint associated with printing a book can choose between a facility powered by hydroelectric power that is far from key markets or one powered by coal that is near key markets. Since the printing uses less energy than the transportation, the coal-powered facility's total carbon footprint is lighter and it represents the preferred choice.
As carbon management along the supply chain grows, third-party auditing and verification may become widespread. This additional layer of measurement and monitoring may be costly at first but it will add value both in building stronger relationships between supply chain collaborators and in identifying areas where further improvements can be made.
Carbon, given its current prevalence, could emerge as criteria in market access and consumer choice. A jurisdiction could introduce a trade policy that places a levy on products requiring carbon-intensive energy, such as coal, or requires disclosure of the carbon footprint. Consumers may show a preference for goods that have lower environmental and social impacts, as well as being cost competitive.
Finding common ground on carbon
The common cause of carbon is apparent. Less clear is how this will induce change -- in purchasing decisions, in the design of supply chains, and in the definition of sustainability. Our interviews helped to show how the sustainability agenda -- which often has conflicting environmental, economic, and social goals -- has found common ground in carbon.
Current trends in carbon management, such as reducing employee travel, offer limited returns. More sophisticated policies are needed that look at suppliers, logistics, and operations -- in other words, the supply chain. Businesses have identified carbon as a means for progress in balancing short-term costs, long-term profitability, and the maintenance of a corporate brand. Supply chains have aligned corporate strategies around it. Some prioritize operational excellence, others anticipate the need for regulatory compliance, others respond to consumer demand. All are able to use efforts to manage and reduce their carbon emissions to further these goals.
Carbon may change the structure of businesses in fundamental ways. Even today, when carbon is without a price, companies are finding that reducing their carbon footprint reduces their fuel costs, offering significant savings. As carbon gains a price, these companies will derive multiple benefits from their advances -- both fuel and emissions will cost less.
Businesses already market their products on the basis of the carbon footprint; this trend is expected to continue. New opportunities, new markets and new collaborators may emerge.
Evolving businesses inexorably lead to evolving supply chains.
To be slow on carbon is risky business these days. Its role in climate change is having a direct impact on performance, profitability, regulatory compliance, and market access. It has the potential to transform the supply chain, making it stronger and more resilient.
Dr. Gary Bull, associate professor, Forest Resources Management Department, University of British Columbia, and Dr. Chris Elliot, director of WWF's Global Forest Programme, worked with Graham Kissack, R.A. Kozak and Justin Bull. The full report, Toward a Common Cause: the Embrace of Carbon Along a Supply Chain is posted atwww.naturallywood.com.
Why it is important to put a price on nature
Price fixing
Jan 18th 2010
From Economist.com
Why it is important to put a price on nature
THE insight that nature provides services to mankind is not a new one. In 360BC Plato remarked on the helpful role that forests play in preserving fertile soil; in their absence, he noted, the land was turned into desert, like the bones of a wasted body. The idea that the value provided by such “ecosystem services” can be represented by ecologists in a way that economists can get to grips with, though, is rather newer. A number of the thinkers who have made it a hot topic in the past decade gathered at a meeting on biodiversity and ecosystem services held by theRoyal Society, in London, on January 13th and 14th. They looked at the progress and prospects of their attempts to argue for the preservation of nature by better capturing the value of the things – such as pollination, air quality and carbon storage – that it seemingly does for free.
Environmental valuations aim to solve a problem that troubles both economists and ecologists: the misallocation of resources. Take mangrove swamps. Over the past two decades around a third of the world’s mangrove swamps have been converted for human use, with many turned into valuable shrimp farms. In 2007 an economic study of such shrimp farms in Thailand showed that the commercial profits per hectare were $9,632. If that were the only factor, conversion would seem an excellent idea.
However, proper accounting shows that for each hectare government subsidies formed $8,412 of this figure and there were costs, too: $1,000 for pollution and $12,392 for losses to ecosystem services. These comprised damage to the supply of foods and medicines that people had taken from the forest, the loss of habitats for fish, and less buffering against storms. And because a given shrimp farm only stays productive for three or four years, there was the additional cost of restoring them afterwards: if you do so with mangroves themselves, add another $9,318 per hectare. The overall lesson is that what looks beneficial only does so because the profits are retained by the private sector, while the problems are spread out across society at large, appearing on no specific balance sheet.
Ecosystem-services researchers are now providing such balance sheets in more and more of the world. Poor countries such as South Africa and Tanzania have realised that if they study the provision of such services sensibly, they can make more rational decisions and avoid some of the costly mistakes made by those places that have already developed. To this end, the Natural Capital Project, a group based at Stanford University, California, has developed a suite of computer programs called InVEST, which will analyse and map ecosystem services. InVEST allows farmers, landowners and government officials to make better-informed decisions about the current and future costs of an activity.
In the Eastern Arc mountains in Tanzania, for example, deforestation is reducing river flows, which leaves the people and industries of Dar es Salaam, the country’s largest city, short of both water and hydroelectricity. InVEST is being used to find the least bad places for further upstream development, and to pinpoint those areas where paying the locals to maintain the environment will yield the greatest dividends downstream. Meanwhile, in Colombia, funds have been created by water users, particularly the thirsty sugarcane industry, to pay for investment in watershed conservation and restoration. Again, the priority areas for such funds are being discovered by mapping the ecosystem services.
The move to put a price on nature has its critics. Some think the notion is an affront to those who place cultural, spiritual or aesthetic value on biodiversity for its own sake. It would be a mistake to look at things this way. In valuing a particular service – such as the cost of erosion to Greek hillsides – which can be quantified with a reasonable degree of certainty, you do not exhaust the reasons for preserving the groves where the dryads play.
The other concern, among nature lovers, is that valuations may not always give the answers that they want. Humans are fond of pandas and elephants: yet the species that provide the greatest utility may turn out to be dung beetles, bacteria and trees. To others, though, including many who come from economics, this is a feature, not a bug (or a beetle). It means that the service approach really is trying to measure something useful, rather than confirming prejudices about what needs saving.
Partha Dasgupta, an economist at Cambridge University who gave the Royal Society meeting’s opening address, stressed that the ecosystem approach has still more to offer: it can go beyond being a decision tool to becoming a key part of macroeconomic thinking. Dr Dasgupta wants a new measure of national wealth that captures the state of a country’s environment in ways that GDP cannot, a measure he calls “Inclusive Wealth”. Pavan Sukhdev, an economist at the United Nations Environment Programme, agreed. By way of example, he offered the observation that although GDP incorporates increases in medical spending on respiratory diseases, it does not incorporate the value of reducing air pollution. GDP, he concludes, is an imperfect measure of progress.
Ecologists, then, need to remember that the ultimate prize in ecological economics is not just an increase in the extent to which the environment is a factor in decision-making, but to find ways of weaving it into the fabric of economic thinking. If that results in a better and fuller approximation of the truth, economists should be pleased, too
Exporters warned of carbon standards
Published: 14/01/2010 at 12:00 AM
- Newspaper section: Business
Thai exporters must act to be ready to comply with upcoming stringent carbon standards to be imposed by the United States and Japan, a United Nations agency warns.The politicised concept of Border Carbon Adjustments (BCA) was proposed as a tool for policymakers in Thailand's major export markets to regulate carbon emissions between countries of unequal environmental standards.
BCA allows countries to apply a penalty in the form of a tariff or an obligation to purchase carbon credits on imports from countries which practice less stringent emission standards, according to the United Nations Industrial Development Organisation (Unido).
BCA could be quite expensive for Thai companies, especially SMEs (small and medium-sized enterprises), said Ayumi Fujino, head of the Unido regional office in Bangkok.
Technical capacity is another critical issue that needs to be taken into account for exporters to comply with such measures.
While the legality of BCA under the World Trade Organisation remains doubtful, the measure has been endorsed in Japan while it awaits legislative approval in the US. The European Union is also working on it, she added.
By increasing costs in imported materials for developing nations, the measure would force these nations lose a measure of their competitiveness in overseas markets.
The Thailand Greenhouse Gas Management Organisation (TGO) has called on Thai manufacturers to be aware of more intensified measures regarding carbon emissions following the UN's climate change summit in Copenhagen last December.
So far, 25 products have been approved to carry carbon footprint labels that detail carbon emissions for the life cycle of the items, including Thai Namthip soft drinks, Charoen Pokphand frozen foods, and Thai Airways International's in-flight menus, according to the TGO executive director, Sirithan Pairoj-Boriboon.
The agency has also granted 56 products a carbon reduction label, covering a wide range of goods such as cement, cans, vegetable oil, rice and condoms, he added.
The TGO and Unido have joined with the Federation of Thai Industries (FTI) to arrange a one-day seminar on Jan 20 to provide critical input for the Thai private sector and government agencies on policy responses to BCA.
The forum aims to raise awareness among the Thai export community and increase understanding of preparatory measures that must be taken to remain competitive in the changing global market.
Thursday, January 14, 2010
Graft threatens Indonesia's carbon offset billions: report
By Sunanda Creagh
JAKARTA (Reuters) - Billions of dollars set to flood into Indonesia under a U.N.-backed forest protection scheme are at risk because of graft unless the country puts strong oversight mechanisms in place, a report released on Tuesday warned.
Indonesia has the world's third largest area of tropical forest and stands to gain billions of dollars every year from a proposed greenhouse gas offset scheme called reduced emissions from deforestation and degradation (REDD) that was formalized at recent global climate talks in Copenhagen.
REDD allows polluters to earn tradeable carbon credits by paying developing nations not to chop down their trees.
However, a two-year study by the West Java-based Center for International Forestry Research (CIFOR) warned that past and recent cases of corruption and financial mismanagement in Indonesia's forestry sector revealed systemic weaknesses that could scuttle REDD.
"Investors should be looking very carefully at the financial governance conditions in the countries where they will be investing their funds. Like Indonesia, many tropical forest countries have long track records of mismanaging public financial resources, particularly in the forestry sector," said the report's co-author, Christopher Barr.
A spokesman from the Forestry Department said the government was committed to transparency.
"Everything is now transparent, measured and monitored. Not just in the REDD sector but in all our financial management, it's now very tight," said spokesman Masyhud.
"It's not possible to play around. Every institution has an inspector general and we also now have the Supreme Audit Agency and the Corruption Eradication Commission," two agencies which are involved in the fight against corruption.
PAST PROBLEMS COULD RETURN
Indonesia last year set up a legal framework for REDD. Several pilot projects are under way and the governments of Norway, Australia, Germany and the U.S. have promised millions of dollars in funding for REDD demonstration activities.
The CIFOR report recommended Indonesia set up new mechanisms to monitor the money flowing into the country for REDD projects and to strengthen existing oversight bodies such as the Corruption Eradication Commission, known as the KPK.
The report exposed details of mismanagement of the Reforestation Fund, which was established in 1989 under former president Suharto and which collected billions of dollars in levies from timber concessionaires to pay for reforestation.
The CIFOR study was partly based on a previously unpublished 1999 audit by Ernst and Young, seen by Reuters, which found $5.252 billion was lost from the fund through systemic financial mismanagement and fraud between 1993/94 and 1997/98.
Control of the Reforestation Fund has now been transferred to the Ministry of Finance and institutions such as the KPK and Supreme Audit Agency have helped improve the situation since the fall of Suharto in 1998, said Barr.
"But significant problems have continued through the post-Suharto period, many of which raise fundamental questions about how future REDD payment schemes will be managed," he said.
KPK spokesman Johan Budi said the agency is now investigating senior forestry ministry officials and lawmakers suspected of taking bribes for a radio communications system contract.
"The problems that have plagued the Reforestation Fund over the last 20 years are likely to reoccur" without further strengthening of oversight systems, Barr said.
Indonesia last week revealed an ambitious plan to create an extra 21.15 million hectares (52.26 acres) of forest by 2020.
(Editing by Sara Webb and Sanjeev Miglani)