Public Sector carbon management - shifting effort from reporting to reduction

Posted Tuesday 23rd February, 2010

Ram Ramachander, Chief Operating Officer at Greenstone Carbon Management.

Carbon emissions represent an increasing and potentially significant cost for private and public organisations. The case that carbon reduction and reporting systems can help organisations make significant reductions in their emissions and costs has been well made but there is a general expectation that UK public sector should be forging ahead and setting an example in meeting mandatory requirements. Yet according to Ram Ramachander, Chief Operating Officer at Greenstone Carbon Management, the public sector risks not meeting its carbon targets as it gets overloaded with bureaucracy and inadequate reporting systems.

Public sector organisations currently has a broad range of reporting requirements from the CRC Energy Efficiency Scheme (formerly known as the Carbon Reduction Commitment) due to start in April 2010 , the Sustainable Operations on the Government Estate (SOGE) targets , and the Government's own estate carbon neutrality 2012 targets to name but a few and each scheme will require a specific report for each stake holder.

Take the CRC Energy Efficiency Scheme for example. The granularity of data required to report against this legislation will mean that public sector bodies will have to capture data at an individual site level on a regular basis, whereas today they may be capturing data at a high level, once a year. The data must also be accurate to ensure that they do not fall foul of the fines associated with inaccurate reporting, or the costs associated with inaccurate forecasting of future allowance requirements. Estimates show that the administrative costs of reporting against legislation could double if not treble over time.

With very little probability of funding for additional administrative resource over the next few years, public sector bodies face having to absorb the reporting burden within the existing teams. This has created a real threat of not meeting their targets. It is becoming clear that the public sector now needs to transition towards a more automated approach to carbon management.

Carbon reporting with the right tools

In the private sector, large global organisations that face growing legislative burdens are migrating from manual and spreadsheet based measurement and data gathering tools and processes to fully integrated Enterprise Carbon Management (ECM) tools. These tools remove a large portion of the data gathering and reporting burden, as well as giving sustainability practitioners the ability to model and manage reduction programmes. It is anticipated that the use of these solutions will increase five fold by 2011.

The larger public sector bodies such as the central Government departments and County Councils have already started examining the possibility of transitioning to such systems. The business case for the implementation of ECM software is very strong. Cost savings can be gained in reduced administration (including future staffing costs for meeting the CRC burden) and improved capabilities and capacity in carbon reduction programmes. In modelling the impact of such a deployment in one large department we were able to demonstrate FTE savings and increased carbon reductions - with a consequent ROI of less than 12 months.

Examples of current carbon emissions targets and associated reporting requirements:

Sustainable Operations on the Government Estate (SOGE) targets, which require the entire central government estate to reduce its carbon emissions by 30% by 2020. This information is reported to the OGC on a quarterly basis.

CRC Energy Efficiency Scheme, which requires all eligible public sector bodies to report their energy consumption and associated carbon emissions to the Environment Agency and, in future years, will require the purchase of carbon allowances on an annual basis.

Carbon Budgets to be issued by Department for Energy and Climate Change (DECC)

Government estate carbon neutrality target by 2012

National Indicators 185 and 186 include a wide range of key performance indicators for carbon emissions covering both internal emissions and community wide emissions in local government.

A variety of department specific targets and requirements, for example: the Higher Education Funding Council requires Universities to commit to carbon reductions in their funding applications and the NHS Sustainability Unit drive to encourage Health Authorities to engage in carbon reduction programmes.

Readdressing the balance

In addition to these targets, sustainability teams regularly respond to ministerial and senior civil servant needs on an ad hoc basis. In our experience of working with the sustainability teams, they are highly committed and motivated individuals, focussed on meeting these targets and doing more to become exemplars in sustainability. Instead of spending their valuable time and experience on executing successful reduction programmes the sustainability teams are collecting data, managing complex spreadsheets and generating a broad range of reports to suit the needs of very different stakeholders.

Adopting a Shared Service approach to Enterprise Carbon Accounting

As public sector organisations start to migrate towards automation in this area, they need to consider the opportunity to procure these systems collaboratively as a possible shared service. This will also enable UK public sector to have a consistent way of measuring carbon across its various entities which will allow it to perform meaningful analysis at a macro level and benchmark performance of different organisations. This will give individual organisations the ability to manage and report their carbon as separate entities whilst allowing centralised organisations to receive reports, analyse and benchmark automatically. A shared service approach will meet the complex multiple stakeholders' requirements and avoid a proliferation of incompatible solutions while at the same time allowing sustainability managers to get on with the business of reducing carbon rather than being held back by the burden of reporting.

Ram Ramachander is Chief Operating Officer at Greenstone Carbon Management. Ram has over 15 years experience in management consulting and business development within the IT and public sectors. Carbon Management Limited is a specialist carbon solutions company - based in London, United Kingdom. For further information please visit: www.greenstonecarbon.com

This article was posted on Tuesday 23rd February, 2010.

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