3-Step Strategy For Setting GHG Reduction Targets

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How can your company send a message to your customers and investors about your commitment to sustainability? One common way is to establish GHG reduction goals relative to a GHG baseline inventory. KERAMIDA is constantly engaged with a wide variety of clients for this exact task. Our clients range from small family-owned businesses to international Fortune 500 tech companies, all with the same goal in mind, to do their part to be socially responsible and reduce the stress of their operations on climate change. Below we’ll discuss the best 3-step strategy for setting your GHG reduction targets.

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Step 1: Establish Baseline GHG Emissions Inventory

First, a company needs to establish a baseline GHG emissions inventory. This is the benchmark of comparison for future GHG reductions. If you have a suspect GHG baseline, it will be very difficult to identify realistic and achievable GHG reduction goals. The benchmark of comparison for years to come needs to be as accurate as possible. GHG emissions can be categorized by three main scopes:

  • Scope 1 GHG Emissions

    • These are direct emissions occurring from sources owned or controlled by the company. This includes common activities such as natural gas combustion, mobile sources, process emissions, and fugitive emissions.

  • Scope 2 GHG Emissions

    • These are indirect emissions from the generation of purchased electricity. This is typically the indirect emissions related to the generation of electricity that is purchased by the company.

  • Scope 3 GHG Emissions

    • These are emissions due to the company operations, both upstream and downstream processes. The GHG Protocol, a widely accepted calculation standard, identifies 13 types of Scope 3 emission sources:

      • purchased goods and services

      • capital goods

      • fuel and energy related activities

      • upstream transportation and distribution

      • waste generation

      • business travel

      • employee commuting

      • upstream leased assets

      • downstream transportation and distribution

      • processing of sold products

      • use of sold products

      • end of life treatment of sold products

      • downstream leased assets

    • This is quite a list and surely contains emission sources that a company may not have thought of as being a GHG emission source.

Step 2: Find the Right Data

The biggest challenge in quantifying Scope 1, 2, and 3 GHG emissions is the availability of data that are used to calculate the emissions. For a company doing this for the first time, this is a huge hurdle to overcome. You want to rely as much as possible on real data and not assumptions, since these are the basis of comparison for GHG reductions going forward. Some data are low hanging fruit such as electricity and natural gas bills, but has your company ever quantified how much refrigerant leakage occurs or your end of life emissions from product that gets e-recycled? The data are somewhere in your company, it is just up to us to help guide you in finding the owner of that data.

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Tip: It’s ok to start with just Scope 1 and 2.

Oftentimes, when a company is first starting down their journey of sustainability, a decision is made to only focus on Scope 1 and 2 GHG emission sources. This is still an excellent starting point and can serve as a great foundation for GHG reductions moving forward. As your company becomes more comfortable with your GHG footprint you can make the move to quantify your Scope 3 GHG emissions.

Step 3: Identify GHG Emission Reduction Technologies

Once a baseline GHG inventory has been developed, the next step is to identify quantifiable GHG emission reduction technologies to establish a reduction commitment. An outcome of the baseline GHG emissions should be the ability to see what emission sources contribute to the majority of the GHG emissions. These emissions sources are the ones you want to target for reduction opportunities. If an emission source, say your mobile fleet, contributes only a small fraction of your overall GHG footprint, it does not make financial sense to phase out the fleet for EV units since it won’t reduce your overall footprint significantly.

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Tip: Consider on-site distributed energy systems.

A popular GHG mitigation solution, that has the potential to provide significant GHG reductions, is the use of on-site distributed energy systems such as solar or wind power generation. Although coming at a high initial capital cost, and depending on the availability of space and resources, this can be a potential solution for your reduction goals. KERAMIDA is currently helping a number of clients determine the feasibility of installing solar panels on their campus to provide on-site electricity.

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Tip: Start by creating a baseline before setting reduction goals.

By creating the baseline and understanding how the calculations are conducted, you have a better understanding on how to get your best “bang for your buck” when committing to technologies that can reduce GHG emissions. It is much easier to start with a baseline, identifying solutions you are willing to commit to, and then determine the emission reductions for your commitment. This way it can be an interactive and iterative exercise in communication between the technical team and the executives who make the final decision. It is much harder to go the other way around by having your executive committee establish a reduction goal as the first step before understanding your baseline. 

Combatting climate change takes a collective effort by every individual or company to act socially responsible to preserve our planet for future generations. The current pandemic only furthers the importance of combating global issues in a timely manner. It will require a foundation of individual efforts by companies to strengthen their global response against climate change. Creating a baseline GHG emissions inventory and subsequent mitigation plan can serve as the beginning of your journey in alleviating the stress of climate change.

Let KERAMIDA be your guide in developing these sustainability baselines and goals. Contact us or call (800) 508-8034 today for immediate assistance.

Blog Author

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Albert Chung, Ph.D., P.E.
Senior Project Manager,
Air, Climate Change & GHG
KERAMIDA Inc.

Contact Albert at achung@keramida.com.