Accounting for carbon emissions

1. Accounting for carbon emissions Kevin Misselbrook Customer Services Director, Access Accounting Ltd

2. Why is the Green Agenda important to my business ? • Cost-saving efficiencies • CSR • Compliance • Business sustainability

3. Cost-Saving • Higher cost of carbon usage • Tax burden • You can’t manage what you can’t measure • Good measurement highlights awareness throughout the organisation

4. CSR • Corporate and Social Responsibility • CSR reporting requirements • Customer attraction • Suppliers • Investor awareness • and ….

5. Moral duty ? • Will day slide ?

6. Stern Review • Overwhelming evidence of climate change • Impact : loss of between 5% - 20% of GDP each year ! • Cost of controlling – as little as 1% of GDP “The costs of stabilising the climate are significant but manageable; delay would be dangerous and much more costly”

7. Supply Chain Pressure

8. Compliance • Climate Change Bill • “Cascade” effect on supply chain • Climate Change Levy • Carbon Trading Schemes (expanding) • ISO 14001 • Environmental standard for businesses • ISO140064 – Carbon Reporting

9. Compliance • More legislation ? • Dept of Energy & Climate Change – (Oct 08) • Audit standards – Carbon Trust, IAASB • Government standard to be provided by Oct 2009 • Companies Act changing by 2012 – mandatory reporting

10. Sustainability • Need to have a business model that operates in a carbon-efficient world • Establish strategies for the future • Build a sustainable energy-efficient business

11. Measurement

12. Improvement Cycle

13. Carbon Measurement • Expensive • Difficult • Process-intensive • Availability of results limited • Difficult to get Actual vs Budget

14. Methodologies • LCA • LifeCycle Assessment • Modelling tool • Good for counting product CO2 cost • BSI PAS 2050 launched 29th October 2008 • Defines the method and approach to LCA calculations

15. 36 pages of guidance !

16. LCA Assessment

18. Methodologies • LCA • On line calculators

20. Methodologies • LCA • On line calculators • Carbon Audit (3rd party) • Company Modelling tools • Integrated within the Accounts function

21. Solution from Access

23. Solution from Access • Embodied within the finance system • Minimal additional keystrokes to collate carbon data • Real time reporting • By Division, Cost Centre, Individual • Actual vs Budget • Short learning curve for staff

24. Accounting for Carbon Emissions • Driven by DEFRA tables • Follows GreenHouse Gas protocol • The only solution integrated within the accounts system • Affordable to SMEs

25. Key Standards Used • GreenHouse Gas Protocol • Scope 1 • Direct production of CO2 emissions • Burning fuel in transport, Chemical process release, creating electricity • Scope 2 • Indirect use of power • Scope 3 • Other indirect carbon • 3rd parties, supply chain etc etc

26. Key Standards Used • Defra Tables • Sets out UK standards for CO2 calculations

27. Key Standards Used

28. Development Strategies • LCA , Corporate Footprint, or both ?

29. Any Questions ?