How to carry out carbon accounting for your clients

Carbon accounting helps businesses measure and reduce their greenhouse gas emissions, meet regulations, and improve sustainability. This process follows the GHG Protocol, covering three key areas: Scope 1 (direct emissions), Scope 2 (indirect emissions from energy), and Scope 3 (indirect emissions from supply chains).

Here’s how to get started:

• Use tools like Emerald Power, Persefoni, or Watershed to automate data collection and ensure compliance.

• Follow the GHG Protocol framework for accurate, consistent, and transparent reporting.

• Break down emissions by scope (e.g., fuel usage for Scope 1, electricity for Scope 2, supplier data for Scope 3).

• Set science-based targets to align with global climate goals and track progress regularly.

Quick Tip: Choose software that fits your business size and needs - Emerald Power is a great option for mid-sized companies with features like automated data collection and real-time tracking. Start with accurate data, calculate emissions using verified formulas, and create detailed reports to meet regulatory requirements and improve operations.

Corporate Carbon Footprint - Understanding Scope 1, 2 and 3 Greenhouse Gas (GHG) Emissions

Tools and Standards for Carbon Accounting

What is the GHG Protocol?

The GHG Protocol provides a framework for reporting emissions in a way that's consistent, accurate, and transparent. It's aligned with ISO 14064 and PCAF, and its principles - accuracy, completeness, consistency, transparency, and relevance - are designed to guide reliable carbon accounting practices ^[3]. Once you understand the framework, the next step is finding tools that fit these standards.

How to Select Carbon Accounting Software

Carbon accounting software comes in a range of prices and features:

When choosing a platform, focus on features like data integration, automation, GHG-compliant reporting, and reliable emissions factors ^[1][2]. These capabilities simplify data management while ensuring compliance with the GHG Protocol. A standout option for mid-sized businesses is Emerald Power, which offers tailored solutions.

Emerald Power: Features and Benefits

Emerald Power provides three subscription tiers designed for different needs. The Starter plan (€249/month) covers essential Scope 1-3 calculations and GHG reporting, while the Pro and Enterprise plans include advanced tools like AI automation, real-time data tracking, and custom APIs. All plans meet CSRD and GHG Protocol standards, making compliance straightforward for mid-sized companies.

"Carbon accounting is no longer a voluntary exercise but a critical component of regulatory compliance and investor confidence." - Forrester ^[7]

With its automation and real-time monitoring, Emerald Power simplifies the process of accurate carbon accounting, making it a strong option for businesses committed to managing their emissions effectively.

Step-by-Step Process for Carbon Accounting

Step 1: Collecting Data

Primary data sources play a crucial role in accurate carbon accounting. These sources include on-site monitoring systems, utility bills, and supplier surveys. Here's a breakdown:

Emerald Power's Pro plan simplifies this process by automating data collection. This reduces manual errors and saves time.

Step 2: Calculating Emissions

After gathering the data, emissions are calculated using formulas aligned with the GHG Protocol. The method depends on the emission scope:

• Scope 1 emissions: Multiply activity data (e.g., fuel usage) by the appropriate emission factor. For instance, if a client uses 10,000 therms of natural gas, multiply this by the EPA's emission factor to calculate CO2 equivalent emissions.

• Scope 2 emissions: Use grid factors for location-based calculations or refer to energy contracts for market-based methods.

• Scope 3 emissions: These are often the most challenging and can make up as much as 90% of total emissions ^[4]. Start with spend-based methods for a broad estimate, then refine results with hybrid methods for better precision.

Step 3: Creating Reports and Analyzing Data

Once calculations are complete, the next step is to create detailed reports. These should highlight emissions by scope, track trends, and identify areas for improvement. Emerald Power's tools make it easy to customize reports to meet CSRD or SEC climate disclosure requirements.

Key elements of these reports include:

• A breakdown of emissions by scope and source

• Progress tracking against reduction goals

• Identification of major emission sources or "hotspots"

Emerald Power also allows you to compare your data with industry benchmarks. The platform provides alerts to monitor progress and flag areas needing attention, helping you improve emissions management over time.

With reports and insights in hand, you're well-equipped to maintain compliance and refine your carbon accounting practices.

Tips for Effective Carbon Accounting

Meeting Regulatory Requirements

Regulatory compliance is a major driver for carbon accounting, with 71% of companies citing it as the main reason for tracking emissions ^[5]. To meet these requirements, focus on the following strategies:

After ensuring compliance, the next step is setting realistic goals that align with global climate objectives.

Setting Goals Based on Science

Science-based targets are a proven method for reducing emissions - companies adopting these targets see 21% greater reductions compared to those without them ^[6]. The Science-Based Targets initiative (SBTi) offers a framework for aligning goals with the Paris Agreement’s 1.5°C pathway.

To get started, conduct a baseline emissions assessment. Then, align your reduction targets with sector-specific pathways and create a roadmap with clear interim milestones. Regular monitoring and adjustments are essential to stay on track and meet these goals.

Tracking Progress Over Time

Tracking progress effectively requires robust systems and consistent reviews. Tools like Emerald Power’s Pro plan help streamline this process with features such as:

• Automated real-time data collection

• Smart alerts for deviations from targets

• Benchmarking against industry standards

• Custom APIs for deeper performance analysis

A structured monitoring framework can help ensure success:

Quarterly reviews are particularly useful for spotting challenges early and making timely corrections. Use interactive tools to create visual reports that highlight trends and pinpoint areas needing attention.

Summary and Next Steps

Key Takeaways

Effective carbon accounting hinges on using frameworks like the GHG Protocol, dependable tools for automation and analysis, and consistent methods for gathering, calculating, and reporting data. As regulated reporting becomes more common, the need for accurate and verifiable carbon accounting services has grown significantly.

When choosing carbon accounting software, prioritize solutions that integrate seamlessly with your client's existing systems and match their specific size and complexity. This approach ensures smooth data management and compliance with reporting standards.

How to Begin

Implementing carbon accounting can be straightforward with the right tools and strategies. Start by selecting software tailored to your client's needs, develop a standardized process aligned with the GHG Protocol, and stay updated by pursuing certifications and keeping up with industry developments.

To keep carbon accounting precise and compliant, ongoing monitoring and refinement are essential. Use a structured approach that includes monthly validations, quarterly reviews, and annual audits. This helps:

• Ensure data is accurate and dependable

• Monitor progress toward established goals

• Stay aligned with changing regulations

• Provide insights for strategic decisions

Stay up-to-date through certifications, professional networks, and regulatory changes to offer your clients the most relevant advice. Following these steps allows consultants to deliver accurate, actionable insights, helping clients meet compliance requirements and achieve their sustainability objectives.

FAQs

How do you calculate carbon accounting?

For consultants, calculating carbon emissions accurately is crucial for managing emissions and meeting compliance standards. The basic formula is:

Activity Data × Emission Factor = Carbon Emissions

The method you use depends on the type of data available:

• Spend-based Method: Relies on financial data. For example, if $100,000 is spent on air travel, you multiply that by the emission factor for the aviation sector.

• Activity-based Method: Uses specific activity data, like miles flown or fuel usage, to provide more precise results.

To ensure accuracy, you’ll need to focus on three main areas:

• Data Quality: Use reliable sources like utility bills, transport logs, or supplier invoices.

• Comprehensive Coverage: Include all emission sources across your operations.

• Standardization: Apply verified emission factors from trusted frameworks like the GHG Protocol.

Platforms like Persefoni and Watershed help automate these calculations for large organizations, maintaining consistency and precision in tracking emissions.