Rebecca Chedd sets out some of the key activities every business needs to consider on their carbon reduction journey, including useful resources SMEs can use at each step.
Every organisation’s road to net zero is different, because every organisation is unique. Some use lots of energy, others use lots of water; some create a lot of waste, others do a lot of travel. The way you approach net zero and the speed at which you can reduce your emissions will also depend on the resources at your disposal.
In other words, there is no single, defined route that applies to everyone, which is why our Journey to Net Zero programme helps businesses to understand what net zero specifically means for them.
Nevertheless, the end destination is the same for everyone. Here are ten general steps that play an important role in all net zero strategies.
1. Identify your emissions inventory
Understanding where your greenhouse gas emissions come from is a crucial prerequisite for setting your net zero goals. Energy consumption, refrigerant gases and transport fuel are often the first things people think about (often referred to as Scope 1 and 2 emissions), but your sources of indirect emissions (Scope 3) may be just (or in some cases even more) important.
Your Scope 3 includes activities such as third-party transport; energy ‘embodied’ in your raw materials, components and packaging; staff commuting and homeworking emissions; and emissions associated with waste management.
2. Quantify your CO2e emissions
To quote an old adage – if you don’t measure it, you can’t manage it. Once you’ve identified your Scope 1, 2 and 3 sources of emissions, you will need to calculate the annual tonnage of CO2e (carbon dioxide equivalent) emitted – this is your organisational carbon footprint.
This involves gathering data on, for example, the quantity of electricity consumed each year, the number of distribution miles travelled, then converting this into CO2e using government and other conversion factors.
3. Identify carbon reduction opportunities
Having identified and quantified your CO2e emissions, use this information to determine where your 'hot spots' are.
An absolute reduction in your emissions should be the priority action for all businesses. Anything else – for example, jumping straight to carbon offsetting – could be unproductive and may be seen as ‘greenwashing’ (making unsubstantiated environmental claims).
4. Set targets for improvement
Any journey to net zero requires short, medium, and longer-term goals and targets. A single statement of “We Will Be Net Zero by 2050” is not enough to help you manage the challenge on an ongoing basis, or keep your stakeholders happy.
Think about how you are going to monitor and report on your progress and which stakeholders you will share your progress with.
5. Prioritise and implement reduction opportunities
Initially, you should focus on actions within your direct control that will have the greatest impact. This could include improving your building, upgrading old equipment, or reducing waste and over-consumption.
Longer-term investments such as electrification of your fleet could help to future-proof against future fuel price rises, market changes and government policy developments.
Scope 3 emissions, such as carbon ‘embodied’ in your raw materials, packaging and components, may require bolder action and more innovative thinking – engaging with your suppliers early is important (see step 8).
6. Switch to a (true) renewable energy tariff
One of the easiest ways to reduce your impact is to switch to an energy contract that specifies a supply from renewable sources. This will help to support the growing renewable energy generation network in the UK and reduce our reliance on traditional power stations that use fossil fuels.
However, watch out for greenwashing – not all renewable tariffs are what they seem.
7. Invest in on-site renewable energy generation
Many companies are looking to their rooftops and other areas of their site to generate their own energy. Solar PV arrays, for instance, allow you to generate your own electricity – offering low-cost or free power for your site and the opportunity to sell excess generation back to the grid (although systems should always be designed to maximise on-site consumption).
Other renewable energy options available include heating technologies such as heat pumps and, in some cases, biomass boilers.
8. Engage with your supply chain
SMEs are responsible for nearly half of the UK’s business-related emissions. Large buyers are increasingly asking their suppliers to demonstrate lower carbon footprints. Your Scope 3 (upstream and downstream) emissions could far exceed those within your direct control, so it’s important to engage with your supply chain.
Examples could include:
Explore opportunities with your suppliers to source alternative materials, such as products with a higher recycled content
Work with third-party hauliers investing in a more fuel-efficient fleet
Support alternative business models that embrace a circular economy rather than a linear one.
9. Explore good quality carbon offsetting
Many companies jump too quickly into carbon offsetting and making claims of ‘carbon neutrality'. Carbon offsetting is not the answer to your journey to net zero but, arguably, it does have its place in the conversation.
Once emissions have been minimised as far as possible, there will always be residual emissions that cannot (yet) be avoided. Approach carbon offsetting with caution though – do your research:
- Are the carbon credits robust and third-party certified?
- Is the project making a positive impact on emissions globally? (i.e., not merely limiting damage or moving the damage elsewhere)
10. Keep up to date with government policy and technology developments
No-one has all the answers to net zero today. In order to achieve net zero globally by 2050 (or sooner), we will have to work together across sectors and supply chains to change the way we live and work and the technologies we develop and adopt.
You can keep up to date with the latest developments and local news in the North West through our monthly Green Intelligence e-newsletter.
If you’re new to the concept of net zero and need support, sign up for our next cohort of Journey to Net Zero – a fully-funded online course of group workshops and guidance that will help you to understand your carbon footprint and build your own strategic plan.
More advice on net zero for Greater Manchester businesses is also available at www.beenetzero.co.uk.
Rebecca Chedd, Environmental Business Advisor
Rebecca has eight years' experience of working in the environmental sector and has been supporting SMEs as part of the Hub's Resource Efficiency team since 2015. Rebecca has previously delivered carbon reduction workshops for organisations including Transport for Greater Manchester and Great Places Housing Group. Rebecca holds an MSc in Energy and the Environment and is an Associate Member of IEMA.