Activity
1: Methods of Determining Scope 1 Emissions
Method I
This method is known as the National Greenhouse Accounts default method
and it outlines the methodologies used for the preparation of National
Greenhouse Accounts by the Department of Climate Change and Energy Efficiency (Department of Climate Change and Energy Efficiency, 2011). Designated emission factors are designated
in this method which is mainly used where the energy source is homogenous.
Method 2
This method is facility based and it focuses on analysis of fuels and
raw materials used at specific facilities with an aim to provide accurate
emission estimates at respective facilities (Defra, 2009). Of particular
interest in this method is the quality of fuels used with focus being on fuels
whose quality varies from point to point such as coal. This method uses
technical guidelines from the Generator Efficiency Standards program. The method
is considered to be of a higher order than Method 1.
Method 3
This method is also facility based. It is similar method 2 with the only
exception being that it requires compliance with the documentary standards for
the analysis of fuels. In addition to this, it requires compliance with the
Australian/ international documentary standards for sampling (Department of Climate Change and Energy Efficiency, 2011).
Method 4
Method 4 is dubbed: direct monitoring of emission systems. It can either
be done continuously or periodically. Unlike the other methods which analyse
the chemical component of fuels, this method directly monitors emissions of
greenhouse gases coming from various activities (Department
of Climate Change and Energy Efficiency, 2011). This method is known to be data intensive and very accurate when well
implemented.
Reasons why method is best for
QEH
Method 1 is most appropriate for use at QEH due to the fact that the
fuels used at the organisation are homogenous. The level of emission at different
facilities is likely to be similar depending on the amount of fuel consumed.
The method is also easy to use and monitoring can easily be commenced without
having to invest in any special equipment. The formula for the determination of
the carbon emissions under this method is:
Eij= Qi x ECi x EFijoxec/
1000
Where Eij is the carbon emission in tonnes, Qi is
the quantity of fuel in tonnes, ECi energy content factor and Fijoxec
is emission factor for each gas type (Pout, Mackenzie and Bettle, 2002). In accordance
with this formula, the carbon emission under scope 1/ Direct emissions =
4000,000/1000 x 34.4 x 69.22/ 1000= 952
Activity
2
Scope 2 emissions come from activities that are primarily aimed at
generating electricity. For electricity to qualify for consideration under
scope 2, the electricity consumption should not form part of the facility. This
scope is applicable in determining the carbon emission contribution by buyers
of electric power. The determination is made using the following formula:
Y=Q x EF/ 1000 where Y is carbon emissions in tonnes, Q is quantity
purchased from the electricity grid and EF is the emission factor per kilowatt
hour for the state from which the electricity is bought (Department of Climate Change and Energy Efficiency, 2011a).
In accordance with this method, the scope 2 carbon emission for QEH is
as tabulated below:
GHG Source
|
Quantities
used
|
Calculation
|
Emissions.
Tonnes CO2-e
|
Scope 2-
Indirect energy
|
|||
Purchased
electricity NSW
|
2,000,000kWh
|
2,000,000 x
0.89/1000
|
1780
|
Purchased
electricity
|
1,000,000kWh
|
1,000,000 x
1.21/1000
|
1210
|
Purchased
electricity
|
250,000kWh
|
250,000 x
0.88/1000
|
220
|
Activity
3
Scope 3 emissions are generated in two ways. The first mode of
generations relates to those burning fossil fuels with an aim to determine
their contribution to the production, extraction and transport of the fuels.
The second mode relates to consumers of electricity with the emissions being
what is attributable to the production, generation, and delivery processes of
the electricity (Holland
The calculation for the carbon emissions under scope three are similar
to scopes 1 and 2 save for the difference in the emission factors. The factors and
subsequent calculations are as follows:
Scope 3-
Indirect energy
|
||||
GHG Source
|
Quantities
used
|
Emmission
factor
|
Calculation
|
Emissions.
Tonnes CO2-e
|
Own transport
fleet- indirect fuel extraction
|
400,000 litres
|
5.3
|
400,000/1000 x
34.4 x 5.3/1000
|
72.928
|
Purchased
electricity (indirect fuel extraction and line loss)- NSW
|
2,000,000kWh
|
0.17
|
2,000,000 x
0.17/1000
|
340
|
Purchased
electricity (indirect fuel extraction and line loss)-
|
1,000,000kWh
|
0.15
|
1,000,000 x
0.15/1000
|
150
|
Purchased
electricity (indirect fuel extraction and line loss)-
|
250,000kWh
|
0.12
|
250,000 x
0.12/1000
|
30
|
Customer use
of vehicles
|
1,100,000,000litres
|
5.3
|
1,100,000,000/1000
x 34.4 x 5.3/1000
|
200552
|
Activity 4
1. In order to effectively monitor the company’s GHG performance there
will be need to monitor a number of factors. To begin with, the amount of fuel
used in the company should be known. This would help in determining the amount
of direct emissions produced. Alongside the amount of fuel should be knowledge
of the preset energy content and emission factors. The determination of scope 2
emissions would require that there be accurate records detailing the amount of
electricity procured from various sources. It would also be necessary to be
constantly informed of the emission factors for electricity from different
locations. The same factors apply for the factors needed to determine the
requirements for scope three emissions. Among the difficult records to obtain
may be the amount of fuel used by customers. This information would also be
needed in calculating the company’s GHG performance.
The accounting system would not be
significantly impacted as the information needed for determining the GHG
performance is what a normal accounting system would normally contain. This is
especially the case in fuel consumed by the organisation and its top
executives. The same would apply to the amount of electricity procured from
various sources.
The information on the
GHG performance cannot be included in the company’s accounting systems. This is
due to the fact that accounting systems mainly deal with monetary figures. The
GHG performance as it is currently is in form of carbon emissions and therefore
not quantifiable in a manner compatible with accounting systems. Secondly,
accounting systems only recognise expenses once they have been incurred. In
this case, no actual expenses have been incurred and they can therefore not be
factored into the accounting systems. The prices of carbon emissions are yet to
be effected with the coming into effect of the recommendations expected to be
in July 2012 (Australian Government, 2012). This means that it is impossible to
incur the expenses as it is. Moreover, the GHG performance estimation would
require a high measure of estimation especially when it comes to collection of
data on the consumption by customers. The use of estimations is not regarded as
part of best practice in accounting systems. The process of collecting accurate
data on customer consumption of fossil fuels may be more costly than the value
of the information itself and that would make such a system untenable.
2. Additional information needed for future calculations of GHG
performance would need to include fuel consumed by employees whose fuel costs
are covered by the organisation. The organisation would also need to use the
GHG performance measurements to determine which of its 18 sites was most or
least efficient in the consumption of energy. The possession of such
information would be useful in determining the efficiency level of their
equipment and help in triggering a self corrective mechanism aimed at improving
the energy efficiency of the organisation.
Activity
5
Investors are mostly interested in the welfare of the organisations and
are therefore mostly interested in the financial impact of their organisations.
Their interest also stretches to future endeavours where possible opportunities
generated by the legislations are put into effect. To an investor, the most
relevant information would be the establishment of the total amount of carbon
emissions generated by the organisation and the amount of money it would cost
the company. The sum totals of the carbon emission totals is as follows:
Scope 1: 952 tonnes
Scope 2: 1780 + 1210 + 220 = 3,210 tonnes
Scope 3: 73 + 340 + 150 + 30 + 200,552 = 201,145 tonnes
The total amount would therefore be 205, 307 tonnes.
The carbon pricing system aims at imposing taxes on the main
contributors of greenhouse emissions with an aim to channel the amounts
collected towards initiatives such as forestation which would help in absorbing
such gases from the atmosphere. The prices applicable in Australia
A sum of 4 million is one that would raise eyebrows among investors and
they would want to know how the organisation would work to reduce the
obligation to acceptable levels.
Details such as embracing new operation models, replacement of old and
archaic machines, initiatives to help reduce the amount of fuel consumed by key
clients and participation in selected CRS activities aimed at mitigating the
impact of greenhouse emissions would work well to reassure investors that the
organisation is on the right course.
Activity
6
One of the main ways of reducing the GHG figure in the company would be
to focus on operation procedures and equipment. The procurement of fuel and electricity
is done to meet the demand of equipment with the organisation. Focus on office
and factory design to reduce the need for lighting would be one good approach.
The replacement of heat bulbs with more efficient bulbs would significantly
reduce the electric energy required. Another initiative would focus on the
efficiency of the machines used. This focus should determine whether there are
machines in need of service or where there are any machines in need of
replacement. Consistent servicing of machines helps in maintaining their
efficiency where they tend to require less energy to execute the same amount of
tasks (Allen, 2009). Old machines should also be replaced by new and more
energy efficient ones. There should also be focus on the supply chain systems
where possible. Where a given equipment can execute several tasks at a time,
then the work should be organised in a manner that ensure that all tasks that
need to be worked in with a machine are run at the same time (Friedlingstein,
2010). This would help in reducing the amount of time over which such machines
are active hence greatly reducing the amount of power needed.
Of importance would also the focus on
procurement procedures. Focus should be made to ensure that minimal costs are
incurred in the storage of inventory or in the transporting system. Where
orders are made in small quantities, a lot of fuel is incurred while
transporting them from the suppliers’ premises. Similarly, where too much
inventory is in place, there may be implications in terms of the energy needed
to keep them in the desired condition and temperature. The organisation should
focus on these aspects and choose a model that minimises costs. As can be seen
from the calculations above, fuel consumption by customers contribute the most
to the GHG figures. This calls for a drive to sensitise customers to embrace
more efficient vehicles and reorganise their operations in a manner that
minimises the need for movement. Awareness campaigns as well as direct
engagements could bear fruits. The organisation could even go the extra mile to
provide such customers with gadgets and equipment that could greatly reduce
their energy consumption levels as part of their CSR initiatives.
The carbon pricing system which allows for
individuals to get paid over their initiatives to conserve the environment
could also be exploited by the company. The company could choose to invest in
establishing large forests in diverse locations and participate in the
conservation agenda in a scale that would not only clear its carbon emission
obligations, but also get it earning from the government. Carbon credit systems
allow for earning based on the amount of greenhouse emissions absorbed from the
atmosphere and a good investment in this area could see the company raise
additional sources of income (Australian Government, 2012).
References
Allen, M.R., et al., 2009. Warming caused by carbon emissions
towards the trillionth tonne. Mature, 458,
pp. 1163-1166
Australian Government, 2012. Carbon
Pricing Mechanism. (Online) Available at:
http://www.cleanenergyfuture.gov.au/clean-energy-future/securing-a-clean-energy-future/appendices/
(Accessed 7 May 2012)
Defra, 2009. Guidance on how
to measure and report your greenhouse gas emissions. (Online) Available at:
http://www.defra.gov.uk/publications/files/pb13309-ghg-guidance-0909011.pdf
(Accessed 7 May 2012)
Department of Climate Change and Energy Efficiency, 2011. National
Greenhouse and Energy Reporting System Measurement: Technical guidelines for
the estimation of greenhouse gas emissions by facilities in Australia Australia
Department of Climate Change and Energy Efficiency, 2011a. National
Greenhouse Accounts Factors. Department
of Climate Change and Energy Efficiency, Commonwealth of Australia
Friedlingstein, P., et al., 2010. Update on CO2 emissions. Nature Geoscience, 3, pp. 811-812
Pout, C.H., MacKenzie, F., Bettle, R., 2002. Carbon dioxide emissions from non domestic buildings: 2000 and beyond. (Online)
Available at: http://www-embp.eng.cam.ac.uk/resources/br442t.pdf (Accessed 7
May 2012)
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