Happy Birthday, Carbon Clear!

 
Six years ago today, Carbon Clear was incorporated in the UK.  Back in 2005, the global carbon market was a very different place:

• The Kyoto Protocol had just entered into force
• The EU-ETS had just started operation
• Al Gore’s “An InconvenientTruth” had not yet been released
• ISO 14064-1 had not been released
• The Gold Standard did not exist
• The Voluntary (now Verified) Carbon Standard had not been released
• The UK Dept for Energy andClimate Change did not exist
•  The International Carbon Reduction and Offset Alliance (ICROA) did not exist

A lot has changed since 2005.  We've been priviliged to witness - and contribute to - the growth and evolution of a thriving ecosystem of companies, institutions and individuals committed to the transition to a low-carbon future.

It's been a successful and busy six years at Carbon Clear, but there is still much more to do.  We look forward to helping our customers and partners transform their relationship with carbon.


(Back to the Carbon Clear Website)

Carbon Clear Report: Britain’s biggest companies get to grips with carbon reporting

A report published by Carbon Clear shows that most companies in the FTSE 100 are now regularly reporting on their greenhouse gas emissions and showing evidence of carbon footprint  reductions.

The research shows that 93 of the 100 companies had issued a 2010 carbon footprint report by June 2011, and that 44 companies publish carbon data for at least the past 5 years. An impressive 77 companies report carbon reductions in relative or absolute terms over the previous 12 months.

The researchers scored publically available information from each company against 33 reporting criteria. There was a significant range in scores, from the highest score of 97% to the lowest score of just 12%.

The top 10 performers were British Sky Broadcasting, Marks & Spencer Group, Aviva, Pearson, RSA Insurance Group, GSK, Hammerson, Kingfisher, Sainsbury and Tesco. The Supermarket and Publishing sectors in the FTSE100 are best performers, with the Manufacturing, Mining & Metals and Building Materials sectors coming bottom of the league table.

While most companies seem to be making significant progress reporting their carbon impacts, there
were some noticeable exceptions. 16 companies were unable to report any historical emission reductions
and are yet to publish any plans or targets for achieving future reductions.

The research showed that of the 20 companies that offset their emissioons, 85% also report internal carbon reductions. A total of 6 companies are carbon neutral, but none yet to the new PAS 2060 standard for carbon neutrality.

Mark Chadwick, CEO of Carbon Clear, said “Our analysis identified obvious areas of best practice, and others that fell short. To those companies not yet providing accurate carbon data and reduction plans, I’d urge
them reflect on how they can improve their carbon reporting. Frankly, poor carbon reporting not only
presents a clear commercial risk, but misses an opportunity to capture real business benefits through
reduced resource consumption and better interaction with stakeholders.”

The full report can be accessed here.

(Back to the Carbon Clear website)

Ex-Accenture Chief James Hall Appointed as Carbon Clear Chairman

Following another year of excellent growth and the expansion of our carbon management services, Carbon Clear is pleased to announce the appointment of our first Chairman.

James Hall, who previously held the posts of Managing Partner at Accenture UK and Chief Executive of the UK Identity and Passport Service, will take on the role of Chairman of Carbon Clear from 1st August 2011.

James’ extensive experience of corporate strategy and delivery will help to develop Carbon Clear’s services and guide its fast-growing team of carbon management experts.

Mark Chadwick, CEO of Carbon Clear, said “Carbon Clear has gone from strength to strength this year despite a challenging economy. We’re thrilled to have James Hall on board and believe his broad experience will help us to achieve even better results for our clients.”

James Hall said “Carbon Clear is an ambitious company in a very interesting market – one that is topical given the pressures on companies to demonstrate a responsible approach to their business. I am delighted to have the opportunity to join them as they plan their next stage of growth." 

(Carbon Clear Website)

Airlines, the EU-ETS and Biofuels

The ever-informative news aggregators at Climate Connect have done an interesting wrap up of European airlines' efforts to prepare for inclusion in the EU Emissions Trading Scheme (EU-ETS).  From 2012, airlines that operate from the EU will have to keep their greenhouse gas emissions within a cap set by regulators, or else buy carbon credits for their excesses.

Airlines are pursuing various measures to escape the cost of buying allowances or offsets.  Some, like those in China and the U.S., are suing.  Most European based airlines, however, are looking at ways to reduce their emissions without necessarily reducing the number of flights.  Key in these efforts is a switch to biofuels.  As Climate Connect reports, KLM has begun operating commercial flights between Paris and Amsterdam using a biokerosene blend derived from used cooking oil.  Lufthansa will use a 50% biofuel blend in one engine on flights between Hamburg and Frankfurt (planes are designed to fly and land safely on one engine). And British Airways is planning to procure modest amounts of biofuel from municipal waste by 2014.

All of this is superficially encouraging, until you consider the routes on which they are using these more "environmentally friendly" fuels.  Paris to Amsterdam is 500 km (300 miles).  That's 3 hours 18 minutes from city centre to city centre by rail.  By air it's a 1 hour 15 minutes flightr, plus 2 hours check-in and travel out to the airport for a total journey time that's the same or even longer than taking the train. The time savings are more in the airlines' favour on the Frankfurt-Hamburg route, but not by much.

Who exactly is making all those flights, and why?
 
I understand that the airlines want to test the use of biofuels on routes where there's somewhere safe to land if things go wrong - the mid-Atlantic is not the place to discover there's a problem.  However, I worry that making too much noise about their pioneering use of biofuels on extremely short-haul flights raises reputational risks for the airlines.  Greenhouse gas emissions from short-haul airplane flights are about 10X those of rail travel. Using biofuels to cut those emissions by 20% or so does not make short-haul flights an environmentally benign option, especially when more sustainable alternatives already exist.

Another English Speaking Country Puts a Price on Carbon

First the UK, and now Australia.

On Sunday, the Australian Government launched its "Clean Energy Future", which aims to decouple economic growth from greenhouse gas emissions.

The initiative combines a number of measures to drive emission reductions throughout the economy while minimising the pain felt by ordinary citizens:

• a carbon tax of AUS$23 (US$24.50/ £15/ €17.40) on the largest polluters, which will convert to a cap and trade system by 2015;
• income tax reductions and rebates for individuals and families to balance out the trickle-down effects of the carbon tax;
• incentives to promote renewable energy;
• policies to encourage lower-emissions land use measures.

The Australian scheme aims to reduce emissions by 159 million tonnes CO2e by 2020 - equivalent to taking 45 million cars off the road.  It throws down the gauntlet for U.S. policy makers who are concerned that bold measures will harm the economy.

Let's hope they're paying attention, and are brave enough to raise the ante.

Drought Threatens Southern U.S.

A crescent of states stretching from Deleware to Arizona are in the grip of a deepening drought that the New York Times says may rival the Dust Bowl.

The drought is breaking records across the southern states, with Oklahoma's rainfall only 28% of normal.  Wells are running dry. Crops are withering in the field, where they had a chance to grow at all.  Farmers are sending cattle to slaughter because they cannot afford to feed them. As the Times reports, the economic damage from the drought could surpass $3 billion in Texas alone.

Interestingly, the Times does not mention climate change as a possible cause of the drought - a La Niña weather system in the Pacific gets the blame.  Indeed, it is difficult to blame any single incident on a long term global phenomenon.  However, this drought - and ther earlier Midwestern floods, Russian heatwaves and a host of other recent weather disasters - are precisely the types of impacts that we can expect from global climate change.


What lessons can we learn?  One is that adaptation to climate stress is costly and manifests itself in unpredictable ways - even in wealthy economies with good infrastructure.  Higher grain prices in the U.S. will cause ripples in global commodity markets, squeezing pocketbooks and potentially threatening food security in developing nations. The drought is likely to cause a short term collapse in the price of beef as ranchers bring cattle to market early.  This means less money in farmers' pockets and less tax revenue for Southern states - even as the U.S. economy continues to struggle. And shrinking aquifers threaten the continued growth of towns and cities across the American South.

Wealthy nations are struggling to restart their economies and reduce budget deficits. Few will relish taking on the costs associated with worsening climate change.  Developing countries are even less prepared.  Compared to these costs, measures to limit global warming - energy efficiency, renewables, and others - can seem like a bargain.

(Back to the Carbon Clear website)

High Carbon Emitters Have Lower Market Value

Research has suggested a link between financial success and sustainability success for years. And, last month another study punctuated this fact once more; the market cares if your company is actively measuring and reducing carbon emissions.

A study undertaken by researchers at the University of Wisconsin, University of Notre Dame and Georgetown found a negative correlation between emissions and the values of companies in the S&P 500. In fact, they estimated that for every additional ton emitted by a company, company value declines by approximately $200,000 USD.

The research is derived from a review of S&P 500 companies that reported to the CDP between 2006 and 2008.

That the market attaches an implicit cost to carbon (despite that an explicit cost does not exist) is not new.

Over the past few years a strong link has been made in studies between companies who have transparent CSR (Corporate Social Responsibility) practices and positive stock ratings. For example, a collaborative study by scholars at Harvard and the London Business School found that after surveying 4,100 publicly traded companies over the course of 13 years (1997 to 2009) a clear trend emerged. That trend was that equity analysts increasingly view a company’s CSR strategies as value creation strategies that reduce uncertainty about future profitability. As a consequence, analysts have more favorable ratings to companies that have sustainability strategies in place.

Beyond meeting investor expectations, managing and reducing your emissions internally can result in operational cost savings, new revenue opportunities, and enhanced brand reputation.

All this begs the question, is your company actively curbing carbon emissions, and thus generating stronger market value? If no, why not? You’re missing out on valuable business opportunities and soon your investors will take notice.