Enterprise Carbon Accounting (ECA)/ Corporate Carbon Footprint aims to be a rapid and cost effective process for businesses to collect, summarise, and report enterprise and supply chain GHG inventories. ECA leverages financial accounting principles, whilst utilising a hybrid of input-output LCA (Life Cycle Analysis)and process methodologies as appropriate. The evolution to ECA is necessary to address the urgent need for a more comprehensive and scalable approach to carbon accounting. While an emerging area, a number of new companies offer ECA solutions. ECA is a critical part of broader Enterprise Sustainability Accounting.
Contents
Characteristics of ECA
To be successful, an Enterprise Carbon Accounting system should have the following characteristics:
Comprehensive: Incorporates Scope 1,2 and 3 emissions
Periodic: Enables updates at regular intervals and comparisons across reporting periods
Auditable: Traces transactions and enables independent reviews for compliance
Flexible: Incorporates data from multiple approaches to life cycle analysis
Standards-Based: Accommodates existing generally accepted standards and emerging standards
Scalable: Accommodates growing volume and complexity of business operations
Efficient: Delivers data in the timeframe required for decision making
Enterprises that realize reduced emissions and energy consumption utilize systems with the following capabilities:
* Real-time historical energy data that is easily accessible
* Role-based visibility into plant emissions data
* Provides executives with real-time visibility into emissions data
* Ability to benchmark emissions levels with goals and industry standards
Process LCA
Process LCA is the most popular method, currently, for conducting life-cycle assessment, and is often referred to as the SETAC-EPA method because of the role played by SETAC and EPA in this method’s development. The inputs and outputs of multiple stages of a product’s life are investigated in turn, and the results are aggregated into single metrics of impact such as eutrophication, toxicity, and greenhouse gas emissions. Three tools exist on the market to assist researchers in conducting process LCA (such as GaBi, Ecoinvent, and Umberto). These tools contain data from previous researchers on the environmental impact of materials and processes that are then strung together by the user to form a system.
Economic Input-Output LCA
Input-Output LCA utilizes economic input-output tables and industry-level environmental data to construct a database of environmental impacts per dollar sold by an industry. The boundary problem of process LCA is solved in this method because the economic input-output table captures the interrelations of all economic sectors; however, aggregated industrial categories limit the specificity of the results. Input–output analysis is a very powerful tool for the upfront screening of corporate carbon footprints, for informing streamlined supply-chain GHG accounting and for setting priorities for more detailed analyses.
Hybrid LCA
Many methods for hybrid life-cycle assessments have been discussed, which aim to combine the infinite boundary of EIO-LCA with the specificity of Process LCA.
Enterprise Carbon Accounting (ECA)
At its core, ECA is essentially a hybrid life-cycle assessment; however, rather than the traditional bottom-up approach of life-cycle assessment, ECA links financial data directly to LCA data to produce a snapshot of the companies’ operations. Rather than probing at areas thought to be problematic, ECA quickly identifies problem areas in the supply chain so that rapid action can be taken. This fundamental shift in thinking enables decision makers to rapidly address critical areas within the enterprise and supply chain.
Socialised Supply Chain
Socialised supply chain accounting is the term generally applied to Enterprise Carbon Accounting Solutions that provide a collaborative mechanism for supply chain participants to engage, expose and determine supply chain emissions through the process of shared knowledge. The term "Socialised Supply Chain" was coined by the CEO of Nootrol, Mark Kearns to describe a platform where supply chain participants exposed Process LCA and embedded emissions.
Other Languages
German: Carbon Accounting