ClimeCo Continues Carbonfund.org Mission Toward a Net-Zero Carbon World
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ClimeCo Continues Carbonfund.org Mission Toward a Net-Zero Carbon World
Boyertown, Pennsylvania (November 2, 2022) – Carbonfund.org Foundation, Inc. (“the Foundation”), now named Environment Next, Inc., has decided to rebrand its foundation and divest certain carbon offsetting and its Carbonfree certification operations. ClimeCo is excited to announce that it has chosen to continue the Carbonfund name and mission to make it easy and affordable for individuals, businesses, and organizations to reduce and offset their climate impact. ClimeCo and the Foundation, both pioneers in the voluntary carbon market space, have always been aligned in their values and have been trusted counterparties to each other over the years. Environment Next, Inc., will continue as a non-profit organization providing climate change leadership grants to individuals and non-profits globally.
“We have had the pleasure of working with the Foundation for about 15 years,” says Derek Six, Chief Operating Officer at ClimeCo. “The Foundation was one of the first groups to emphasize the potential of voluntary markets to address the climate change problem, and we have admired their mission and impact. We believe the Foundation’s customers will find in ClimeCo an equally dedicated and passionate team. We look forward to continuing to serve the needs of the Foundation’s customers and offer them an expanded suite of solutions, a diverse portfolio of projects, and new and innovative programs like our ocean-bound plastics collection projects. We are also very excited to welcome several members of the Foundation’s team to the ClimeCo family so that previous customers can expect a familiar experience.”
Together, these two organizations can provide substantial support to those who want to positively impact their environmental footprint. Anyone, from an individual who wants to offset their plastic footprint to a business needing renewable energy credits, will be able to create the best solutions to fit their budget and goals.
“On behalf of the Foundation team transitioning to ClimeCo, I am thrilled that we’re joining a highly qualified company with the same enthusiasm and focus for climate change mitigation,” says Linda Kelly, who served as the Foundation’s SVP of Programs and Partnerships and will be joining ClimeCo as SVP of GHG Markets. “The Foundation’s business partners will greatly benefit from ClimeCo ESG solutions, carbon emissions reduction strategy, and Product Life Cycle Assessments. During my twelve years at the Foundation, I’ve worked with the majority of our business partners. My colleague Anna O’Brien and I look forward to continuing and expanding these relationships.”
Along the eCommerce website and current project inventory, ClimeCo will also be expanding the Carbonfund Carbonfree Partner Program, which provides an innovative and flexible way to help businesses calculate, reduce, and offset their carbon footprint. ClimeCo’s ESG Advisory team has extensive experience in assisting new Carbonfree Partners to go beyond what they thought was possible for their sustainability efforts.
ClimeCo is a respected global advisor, transaction facilitator, trader, and developer of environmental commodity market products and related solutions. We specialize in voluntary carbon, regulated carbon, renewable energy credits, plastics credits, and regional criteria pollutant trading programs. Complimenting these programs is a team of professionals skilled in providing sustainability program management solutions and developing and financing of GHG abatement and mitigation systems.
For more information or to discuss how ClimeCo can drive value for your organization, contact us at +1 484.415.0501, email@example.com, or through our website climeco.com. Be sure to follow us on LinkedIn, Facebook, Instagram, and Twitter using our handle, @ClimeCo.
What Is The Role Of Renewable Electricity In Corporate Sustainability?
What Is The Role Of Renewable Electricity In Corporate Sustainability?
In 2022, it seems that we’ve reached a crescendo of pressure from regulators, investors, customers, peers, and other stakeholders pushing companies along a sustainable path. Things that were once considered exceptional – such as pledging to reach net-zero carbon emissions or using 100% renewable electricity – have quickly become necessities for many companies to keep up with their peers. When we look back at the sustainability landscape over the last few years, it’s easy to see how this sudden boom of ESG has led to some confusion.
As companies enhance their ESG strategy and commit to public-facing initiatives, it becomes crucial to understand how different interventions factor into their corporate carbon accounting. How can carbon offsets be used? Where can companies account for renewable energy? What projects can be undertaken to decarbonize? And ultimately, which of these efforts should be prioritized in an ESG strategy? Companies need to be able to answer these questions and communicate their strategy effectively to stakeholders. In this blog, we explain the role renewable electricity has in corporate sustainability.
How does renewable electricity factor into corporate carbon accounting?
Renewable electricity is often one of the first levers considered when creating a corporate ESG strategy, and the global transition to clean energy is accelerating every year. Bloomberg reported that global renewable energy investment grew by 6.5% in 2021 to a new record of $366 billion. For companies, switching to renewable electricity can be just part of a decarbonization strategy, or specific goals around renewable electricity consumption can be set, such as those set through RE100. When companies plan out renewable electricity adoption, there’s a lot to decipher.
First, companies need to understand how to account for renewable electricity in their carbon footprint. For this, as with all carbon accounting questions, companies will want to reference the Greenhouse Gas (GHG) Protocol, and here specifically – the Scope 2 Guidance. Scope 2 covers indirect emissions from purchased electricity and other purchased energy – basically, the emissions created by the generator of that electricity when the generator is not operated by the company conducting the carbon inventory. For most companies, this refers primarily to electricity from the grid.
Location-based Accounting: Within Scope 2, one option is to account for electricity emissions with a location-based emission factor, where reporting entities use an emission factor based on local grid mix to determine their emissions. This doesn’t allow for contractual instruments, such as Renewable Energy Credits (RECs), to be used to switch generation attributes and lower emissions.
Market-based Accounting: However, the other option – market-based accounting – allows for consumer choices in energy generation and contractual instruments to be reflected in the emission factor. In other words, continuous contracts with a supplier to use a renewable generation, or one-time REC purchases, can be accounted for in the market-based approach. Companies that are considering building renewable electricity into their ESG strategy should utilize a market-based carbon accounting approach for Scope 2.
What renewable electricity options are available to companies?
Option 1: RECs are a common entry point for companies starting to use renewable electricity. RECs represent a certified unit of electricity production from a generator. RECs must be retired on behalf of a specific entity, and once retired, that electricity generation cannot be accounted for elsewhere. RECs are often third-party-certified by entities such as Green-e® Energy. As more RECs are retired, the remaining grid mix, called the “residual mix” gets dirtier, further incentivizing companies to adopt renewable electricity. RECs can be simply purchased in bulk and used to switch a company’s entire electricity consumption to renewable sources each year. Similarly, companies can work with utilities to opt into low-carbon energy contracts, which often work by providing RECs to the purchaser. However, some critics argue that purchasing renewable electricity through RECs stunts companies’ impact on increasing the total amount of renewable electricity on the grid. Companies will also often seek to move beyond RECs to avoid the annual expenditure and price uncertainty in their renewable electricity supply.
Option 2: Onsite generation is another choice for companies, especially those that own property and/or their facilities. Rooftop solar is one popular example. Onsite generation can also occur in leased or rented spaces through collaboration with landlords. This strategy is most often employed in facilities or properties where a company has a long-term lease and plans to stay in a particular location for the foreseeable future. Companies should note that they can only take credit for renewable electricity that is generated onsite if they use power directly from their system or retire RECs generated by their systems on their own behalf. If RECs are sold, that company cannot take credit for the renewable electricity it produced on its site.
Option 3: Many companies who don’t have the assets to invest in onsite renewables opt instead to pursue a Power Purchase Agreement (PPA). In a low-carbon PPA, companies will pay a third-party to develop and maintain a renewable electricity system and sell that energy physically or in the form of credits back to the company. When credits are sold back to the company, but the electricity itself is consumed elsewhere or sold to the grid, these agreements are called Virtual Power Purchase Agreements (VPPAs). Typically, companies will size a PPA based on their energy consumption and will often develop a project along with other interested companies.
In all of these cases, renewable electricity can be accounted for in a company’s carbon footprint, as long as the company uses the market-based approach for Scope 2 accounting and retires the renewable generation credits on their behalf or directly consumes renewable electricity.
“Additionality” in renewable electricity – is it an effective or appropriate metric?
In the world of carbon offsets and project development, “additionality” is a strict qualifier that assesses whether a project was caused by intervention above and beyond regulation. To be additional, it must be determined that a project would not have happened without the intervention of the entity supporting the project. When evaluating what type of renewable electricity strategy to pursue, companies tend to ask themselves about additionality and whether they are supporting a new project – through a PPA, for example. But is this term really applicable to renewable electricity?
Ultimately, additionality isn’t a term that should be used to discuss renewable electricity. The GHG Protocol Scope 2 Guidance advises that “Offset additionality criteria are not fundamental to, or largely compatible with, the underlying rules for market-based scope 2 accounting and allocation.” Additionality is used to qualify projects that are an improvement over a baseline. For example, in carbon offset projects, what is being measured is a change in avoided GHG emissions from a theoretical baseline without intervention. In renewable electricity, direct energy use attributes are being claimed rather than separation from a baseline. It’s also a challenge to determine what is really “in addition” to regulation in the world of renewable electricity. On top of that, there are more aspects of additionality as used in project development, like proving that technology isn’t commonplace, which aren’t useful to apply to renewable electricity.
That said, companies may still face criticism if it’s perceived that they aren’t doing enough to support the development of new renewable electricity sources. Voluntary programs can be developed to address this concern, but for now, companies should stray away from the term “additionality” to avoid making a false claim. In the words of the GHG Protocol Scope 2 Guidance “Maximizing the speed and efficacy of voluntary initiatives in driving new low-carbon development is an important, complex, dynamic, and evolving process for program implementers, regulators, and participants.”. Supporting development of new renewable assets is an ongoing challenge that companies can help accelerate as they increase demand for renewable electricity.
Creating a corporate renewable electricity strategy
As companies face the challenge of adopting renewable electricity and developing a robust plan to meet stakeholder demands, ClimeCo is here to develop a strategy that is right for you. For more information or to discuss how ClimeCo can drive value for your organization, contact us at firstname.lastname@example.org.
About the Author
Garrett Keraga is a Manager on ClimeCo’s Sustainability, Policy, and Advisory team based in Burlington, Vermont. His sustainability work has included greenhouse gas accounting, carbon abatement planning, ESG strategy development, and disclosure advisory. He has worked with a large variety of industries, both across consumer-facing and industrial clients. Garrett holds a Bachelor of Science in Mechanical Engineering from the University of Vermont.
Solutions considered essential to decarbonization reduce greenhouse gas (GHG) emissions, yet rarely come without other environmental impacts. For example, while vehicle electrification will increase battery production, the mining of lithium has a substantial environmental impact. So how do we evaluate whether each trade-off on our path to net-zero is worth it? A Life Cycle Assessment (LCA), which offers a framework for quantifying the potential environmental impacts of a product from cradle–to–grave (i.e., from growth/extraction of raw material inputs all the way through a product’s disposal), allows us to make that determination.
Benefits of LCAs?
Unlike GHG footprints or other Environmental, Social, & Governances (ESG) metrics that typically quantify enterprise-level impacts and show year-to-year progress, LCAs often focus on the potential environmental impact at a specific product or a facility level. Such information can be important to customers, suppliers, employees, investors, and regulatory entities.
ClimeCo has performed a variety of LCA projects across multiple industries and scopes. The goals of an LCA can vary; the following two projects provide examples of two different approaches to LCAs that ClimeCo has recently completed for our clients.
LCA Example #1
Confidential Industrial Manufacturer: Benefits of Practice Change vs. Historical Performance at a Facility
ClimeCo carried out a cradle-to-grave carbon intensity (CI) LCA for four products made at an industrial facility.
The Objective: Communicate Carbon Capture Benefit One of the many applications of an LCA is its ability to demonstrate the environmental benefits achieved by adopting different operational practices. A detailed analysis of GHG emitted through the product lifecycles showed the reduction in CIs achieved by capturing previously vented process CO2 for sequestration. These CIs, and their recent reductions, will be used in customer communications and marketing efforts, differentiating the environmental “value” of the products from those offered by competitors.
Another Use: Evaluate Decarbonization Options LCAs can be a reliable methodology for demonstrating GHG benefits achieved through existing decarbonization actions – as was the case for the scenario above – and for evaluating various potential reduction measures prior to their implementation. When used in combination with tools like Marginal Abatement Cost Curves (MACC), LCAs can help assess reduction pathways along with their associated monetary cost.
ClimeCo collaborated with Asphalt Materials, Inc. (AMI) to complete an LCA-based sustainability assessment of J-Band®, AMI’s void reducing asphalt membrane (VRAM) product.
The Product AMI designed J-Band to reduce road maintenance and extend the lifetime of asphalt pavement roads by strengthening the longitudinal (centerline) joint, traditionally a problematic site for road deterioration. The deterioration results from the intrusion of air and water due to inherently lower asphalt mixture density at the joint. Over time, the joint naturally becomes the weak link in the entire road surface, requiring periodic repairs before complete road replacement. To combat this, J-Band® is a polymer-modified asphalt product applied to the prepared surface prior to applying the new hot-mix asphalt (HMA). When the HMA pavement lifts are applied, heat from the hot-mix drives J-Band® into the available voids, sealing the joint area from below. Due to established jurisdictional practices and specification requirements, J-Band® is used in a smaller percentage of asphalt paving projects in the U.S., with traditional solutions, such as joint adhesive, pave wide trim back (PWTB), and infrared (IR) heaters, being more common.
The Product’s Competitive Edge: Performance and Cost AMI has demonstrated that J-Band® creates a better joint compared to the alternatives, eliminating the need for frequent, significant joint repair, and prolonging the life of the road by at least three additional years. Based on this performance, AMI has shown that J-Band® has a lower lifetime cost, with its upfront costs surpassed by reduced asphalt materials, fuel, and labor costs.
A Sustainability Edge, too? Is the same true for J-Band’s lifetime environmental and social impacts? The product requires energy and material inputs to manufacture and apply – are these impacts surpassed by the benefits of reduced maintenance and extended road lifetime? ClimeCo completed a curtailed-boundary comparative LCA, evaluating J-Band against three traditional longitudinal joint solution alternatives to answer this question. The comparative LCA approach meant impacts common to all alternatives could be excluded from quantification, such as including the production of HMA, transporting the asphalt to the job site, and energy use of the paving equipment. However, for all the life cycle phases where differences between the alternatives were established, the impacts were calculated. The following table shows the life cycle stages included in the analysis.
The Analysis ClimeCo quantified GHGs and criteria air pollutants (AQ) impacts across raw materials extraction, materials manufacturing, product transport, joint solution application, and road maintenance. The developed calculator tool clearly documents assumptions and data sources. It is customizable for key project details, such as project length, distance to the project site, and distance to perform maintenance.
The Results Under the assumed baseline conditions, J-Band demonstrated better sustainability performance and reduced emissions during construction and maintenance phases compared to the longitudinal joint solution alternatives. For more information on this project scope and results, please see the following PowerPoint presentation.
Using LCAs for a More Sustainable Future
As these two project examples show, LCAs can be targeted to answer specific questions and meet specific needs. However, because each LCA is context-specific and fine-tuned to its application, one LCA cannot be compared to another. To manage this limitation, ClimeCo’s standard practice is to use conservative assumptions and to be transparent with methodologies, ensuring trustworthy, well-documented LCA results that align with reality.
Whether you are looking to enhance a product or process, develop sustainability marketing claims, or meet regulatory or reporting requirements, ClimeCo has the expertise in applying LCAs to support informed decision-making across these areas.
About the Authors
Gary Yoder is a Vice President at ClimeCo, providing environmental compliance services to many clients. He specializes in the complexities of air quality compliance but also supports ClimeCo’s sustainability projects and initiatives. Gary holds a Bachelor of Science degree in Geography/Pre-Meteorology from Ohio University and a Master of Science degree in Meteorology from North Carolina State University.
Jaskaran Sidhu is an Analyst on ClimeCo’s Sustainability, Policy, and Advisory team based in Toronto. Jaskaran’s work focuses on life cycle analysis and carbon impact quantification for ClimeCo’s corporate clients. Jaskaran holds a Master of Engineering in Mechanical and Industrial Engineering from the University of Toronto and a Bachelor of Engineering in Mechanical Engineering from Panjab University.