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Business Insider

Why your business carbon footprint matters

 

No matter your industry, understanding your business carbon footprint can help with your bottom line. Facility maintenance professionals could be looking for ways to save on resources, while construction companies may want to appeal to buyers with greener methods or more sustainable buildings.

In a lot of cases, going green can save your business money. Discover what your carbon footprint is and why it matters to your business.

What is a carbon footprint?

An overview of important terms and facts around emissions is helpful to understand why your footprint matters. Discover how to define carbon footprint for your company as well as the major causes of certain emissions.

Carbon footprint

This term refers to the total amount of greenhouse gases a person, business, household or group emits, both directly and indirectly.

Greenhouse gases, or GHG

Greenhouse gases trap heat in the atmosphere, making the planet warmer in what’s called the “greenhouse effect.” Most GHG occur when fossil fuels are burned, which creates carbon dioxide, or CO2.

Landfills, agriculture and livestock produce methane, or CH4, as well as transporting and producing certain fossil fuels.

Farming, wastewater treatment and refrigerants emit nitrous oxide, or N2O, which is about 300 times more potent than CO2, although it is released in much smaller quantities than carbon dioxide is.

Fluorinated gases include hydrofluorocarbons, or HFCs, which are used in air conditioning and refrigeration. The impact of these powerful GHG is expected to increase in the coming years.

What is a business carbon footprint?

Because emissions are measured both directly and indirectly, it can be difficult to capture a corporation’s total emissions impact. The Greenhouse Gas Protocol divides different types of emissions into three scopes:

Scope 1 emissions

These are everything that a company directly uses and controls to operate. This could include fuel for your fleet, heating and cooling your facility, running equipment and more.

Scope 2 emissions

These measure what your company uses indirectly, such as the energy you buy to run your facility or create your products. While your business is using resources that create emissions, you’re not directly generating those emissions by producing that energy.

Scope 3 emissions

These emissions relate to the entire value chain of your business and can be harder to accurately measure. Among many others, scope 3 emissions activities could include purchasing other materials and services for your business, fuel transportation and waste disposal, travel arranged through a third party (such as conferences), as well as the use of the products you manufacture and sell.

What’s the average company carbon footprint?

The Environmental Protection Agency, or EPA, reports that in 2020, transportation was the biggest portion of human-caused GHG emissions in the U.S., at 27%. Electricity production follows at 25%, with industry closely behind at 24%.

Your company’s carbon footprint can vary not only by industry, but also within your industry, depending on what steps you take to reduce emissions. The construction sector typically has a big footprint, and the buildings erected help lead to commercial and residential creating 13% of GHG emissions.

So the average company carbon footprint will be very different for a construction vs. a small plumbing company, and for a facilities warehouse with different modes of delivery. Even a hotel, with multiple streams of indirect scope 3 emissions, will have a different average than residential care homes.

A simpler way to understand your environmental impact is to plug historical data for your business into a calculator.

Calculating business carbon footprint

Because a couple great tools already exist for you to calculate your emissions, you don’t have to start from scratch.

First, gather your utility bills or end-of-year reports for your energy usage, including natural gas, electricity, oil and propane. An overview of your company’s typical consumption habits will also be useful.

You can enter your data to find a simple footprint of your space with the business carbon footprint calculator from Carbonfund.org. If you’re not sure of an answer or a question doesn’t apply to you, skip the question and go to the next one.

When you have this number, you can put it into terms that are useful for you. The EPA’s Greenhouse Gas Equivalencies Calculator converts the data into helpful comparisons to illustrate the impact of the greenhouse gas emissions you’re producing—or avoiding.

If you switch one vehicle to hybrid, for example, the emissions are translated to tons of waste recycled, incandescent lamps switched to LEDs, tree seedlings grown, preserved acres of forest and more.

But why does any of this matter to you? After all, you already have a lot to worry about: rising costs of supplies, keeping your crew productive and safe, tracking shortages and more. See how your business could benefit from reducing emissions.

Benefits of reducing business carbon footprint

While reducing emissions is great for the planet, boosting your bottom line is a more immediate advantage. Explore the benefits of shrinking your footprint, starting with the ability to trim the fat from your operating budget.

Reducing carbon footprint saves money.

Facilities managers and business owners understand there’s a total cost of ownership associated with their business. Switching to environmentally friendly products typically helps lower those costs.

As with any goal, we can’t move forward until we know where we’re starting from. With a benchmark of your current consumption, you can put plans in place to reduce and save your business money.

Tracking emissions helps identify inefficiencies.

If you’re including emissions in monthly or yearly reports, you'll be able to see at a glance if consumption spiked at some point and didn’t return to the baseline. You can investigate to solve the problem—whether that’s shrinkage, leaks, failing equipment or something else—and your operations can return to peak performance.

Customers may prefer businesses with lower emissions.

For both B2B and B2C companies, increasingly customers are asking to see carbon footprint information before they do work with businesses. This can help them calculate their own emissions or simply reduce their individual impact in a more abstract way.

If you market your company as green or publish a Corporate Social Responsibility (CSR) report, your greenhouse gas details—and efforts to reduce consumption—can inform your reports and show your efforts to customers.

Find ways to reduce your business emissions

Once you’ve calculated your footprint and you’re ready to find opportunities to save your business money, explore simple, cost-effective methods with our Green Ideas. You can choose to smart small, by making water heaters more efficient or switching to LED lighting, or go bigger by exploring electric trucks and LEED certification.