Introduction to carbon Accounting

Carbon Accounting is the process of measuring and tracking greenhouse gas (GHG) emissions produced by an organization, project, or activity.

While, there are seven greenhouse gases (CO2, CH4, N2O, HFCs, PFCs, SF6 and NF3) that are recognized in GHG protocol, reporting of emission is done in CO2e; wherein the emissions are converted into equivalent CO2 emissions based on the GWP of the gas.

Importance of carbon accounting: Carbon accounting is critical to assessing the environmental impact of the organization and helps provide a clear picture of the impact while facilitating decision making in identifying strategies to mitigate emissions. Furthermore, carbon emissions are the key component of any sustainability report.

Carbon accounting should be relevant, complete, consistent over a period of time, transparent and accurate. These are the basic principles of carbon accounting.

In order to start carbon accounting for an organization, they should first set the organizational boundary i.e. understand which entities, sites, assets are to be included while accounting for the organization’s carbon emissions. While defining the organizational boundary, one also has to look at the consolidation approach which defines how emissions data is aggregated at the organizational level for different entities associates with the organization. Here entities mean a group company, a subsidiary, an affiliate company, a joint venture/operation or a franchise.

Once the organizational boundary and consolidation approach are set, one needs to identify the scope emissions categories applicable to the organization, based on its activities. Thereafter the respective fuel/ electricity/ material/ service/ waste data is collected to calculate the respective emissions. Finally, these are consolidated in a specific format to be assured and reported.

The above process can be done via an SaaS based platform like Sustainium, which guides the user to set their organizational boundary, enter respective emissions data and visualize the progress towards the emissions reduction goals.