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5 Steps To Create Your Carbon Reduction Strategy

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Thoughtful business. Efficient energy use. Foresight in a fast-changing landscape. It may be a little daunting, yet it’s also very empowering to know that we can do more. In light of the recent IPCC Climate Assessment Report, we’ll have to do more if we’re to uphold the Paris Climate Agreement commitment of limiting global temperature to well below 2°C Celsius. Wanting to answer the call and cement their legacies, governments, corporations, and organisations have been releasing commitments to reduce carbon emissions and be net-zero by 2050.

Setting and reaching carbon targets can seem complicated, but there is no need to go at it alone. To help with implementation and successful follow-through of carbon reduction strategies, Northmore Gordon is working with businesses to reduce their dependency on fossil fuels and shorten the distance to net-zero carbon emissions. In doing so, Northmore Gordon helps Australian businesses develop and execute carbon reduction strategies that will help them improve energy performance and stay competitive in a decarbonizing global economy.

In this article, we’ve outlined a roadmap to reduce carbon emissions. If while reading you have any questions or find yourself ready to make forward strides, don’t hesitate to reach out for a courtesy consultation.

Step 1 — Determine business preparedness and state of carbon emissions

Understanding your business’s current situation is critical to developing an effective plan. With regard to industrial energy users, you’ll want to determine:

A great place to start is by taking the Carbon Health Check quiz on our website. With questions pertaining to your business, its current available systems, and its goals, the quiz will help your business realise whether or not it has sufficient resources to guide itself through a carbon reduction plan or whether outside consultation would be greatly beneficial.

After determining the extent of your business’s resources and ability to effectively implement an emissions reduction plan, now it is time to determine how much carbon the business emits. If you are a large energy user, it’s likely you already report greenhouse gas emissions to National Greenhouse and Energy Reporting (NGERNational Greenhouse and Energy Reporting Scheme. Large energy users and greenhouse gas emitters that exceed the thresholds must report their detailed energy and emissions data each year to the Australian Clean Energy Regulator. More) — a database that contains reported carbon emissions for each fiscal year — and can find your emissions there.

If you don’t report to NGER, then begin by examining the energy sources your business consumes. Most business operations are powered by electricity, which contributes to Scope 2 emissions. If some business processes require thermal energy, then they’re likely powered by burning natural gas.

Finally, if your business relies on forklifts and trucks to move goods within its facility or transport them elsewhere, then LPG and diesel consumption will constitute a portion of the carbon emissions. Natural gas, LPG, and diesel fuel consumption contribute to Scope 1 emissions. For more insight into your emissions and to take a deeper look at Scope 1, 2, & 3 emissions, check out our Carbon Footprint Analysis Form.

Step 2 — Establish your baseline year

Serving as a benchmark to measure progress, your baseline year is an important element to successfully carry out a carbon reduction strategy. It’s best to select a year that is representative of your most stable production or operations. Therefore, do not choose a baseline year in which the business:

To establish an effective baseline emissions year, choose a year within a 3-5 year span when carbon emissions remained relatively steady (+/- 5%).

Step 3 — Create a carbon reduction project list

After establishing a baseline year, generate a list of potential projects that will contribute to net carbon emissions reductions. It can be effective to brainstorm this list with the whole operations team in order to brainstorm a range of ideas, from optimizing current systems, to transitioning to alternative energy sources, to adjusting procurement strategies, to offsetting emissions through other contributions.

Optimizing current systems — it’s often effective to start with energy efficiency measures using existing infrastructure because that will reduce energy intensity — therefore reducing emissions and saving on energy costs — without changing operations. For processes requiring thermal energy, there may be opportunity to recover waste heat and transfer it to another process in order to reduce energy consumption. Improving HVACHeating, ventilation, and air conditioning is the technology of indoor and vehicular environmental comfort. Its goal is to provide thermal comfort and acceptable indoor air quality. insulation or implementing LED lighting are potential ways to optimize current systems.

Transitioning to other energy sources — fuel source has a huge impact on how much carbon your business emits. Clean renewable energy sources, such as wind and solar, are significantly less carbon-intensive than burning natural gas. The most common renewable energy project is installing behind-the-meter PVSolar Photovoltaic solar. While not suitable at all locations, other alternative fuel sources to consider include bioenergyBiomass is plant or animal material used to produce electricity or heat. Examples include forestry by-products, crop waste, animal waste and food processing waste. Biomass is considered a renewable energy fuel if it comes from a sustainably managed source., hydropower, and geothermal energy.

Adjusting procurement strategies — there are a variety of options and sources to purchase electricity, some of which are less carbon-intensive than others. Purchasing Greenpower from your energy retailer is a common way to reduce Scope 2 emissions.

Offsetting emissions through other contributions — while it doesn’t impact local air quality and work environment as much as making on-site improvements, your business can purchase carbon offsets (such as planting trees) in order to work closer to net-zero emissions.

For each project on the list, estimate energy, cost, and carbon emissions savings. In addition, calculate other financial metrics such as simple payback and net present value (NPV). These parameters will be used for your target setting and roadmap analysis.

Step 4 — Set your targets

At this stage, you are setting the target goal for the carbon reduction strategy. A number of governments and other companies have set targets, allowing you to align with their ambition. For example, the NSW State Government has set carbon reduction targets for its state-owned assets to reduce carbon emissions by 50% come 2030 and 100% by 2050.

The Science Based Targets Initiative (SBTiScience Based Targets initiative) is a collaboration that provides science-driven tools and guidelines to establish an emissions reduction plan. To contribute to a healthier and more prolific future, consider using SBTi to serve as a model and leader for other businesses in your area and sector.

Step 5 — Create your roadmap

With a list of potential projects and a commitment to an emissions reduction target, it’s time to create a framework and timeline for your carbon reduction strategy.

Referring to your carbon reduction project list (Step 3), it’s important to differentiate between simpler, less expensive measures and harder improvement measures so as to determine the timeline that works best with your business and goals. Starting with energy efficiency measures may be low-hanging fruit, yet it may not cut emissions as significantly as fuel switching.

Creating your carbon reduction strategy is an iterative process. Adjustments will undoubtedly be made as situations change, policy shifts, and new technologies become available.

Once you have completed your roadmap, it’s important to get executive sign-off on the strategy and communicate it to the public. This transparency drives greater incentive to follow through with your plan.

Climate change affects us all. We are all in this together, and it will take all of us to take meaningful action to remedy the situation. That’s why it is so important for your business to establish and adhere to a carbon reduction strategy. Governments alone won’t be able to solve our climate problem — the private sector will need to play an active role if we’re to avoid the most severe consequences of climate change.

Because we’re all in this together, you can feel confident that support is available to help with your carbon reduction strategy. At Northmore Gordon, we will get you started on the right foot and will provide continuous support to make sure that you reach your target goals.

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What are the 5 steps to create a carbon reduction strategy according to Northmore Gordon?

The 5 steps are: 1) Determine business preparedness and state of carbon emissions, 2) Establish your baseline year, 3) Create a carbon reduction project list, 4) Set your targets, and 5) Create your roadmap.

How can a business determine its state of carbon emissions in Step 1?

Large energy users likely already report greenhouse gas emissions to the National Greenhouse and Energy Reporting (NGER) scheme and can find their emissions there. If a business doesn't report to NGER, it should examine its energy sources: electricity contributes to Scope 2 emissions, while natural gas, LPG, and diesel consumption (e.g., from forklifts and trucks) contribute to Scope 1 emissions.

What tool does Northmore Gordon offer to help businesses assess their readiness for a carbon reduction plan?

Northmore Gordon offers a 'Carbon Health Check' quiz on its website, which asks questions about the business, its current available systems, and its goals to help determine whether the business has sufficient resources to guide itself through a carbon reduction plan or needs outside consultation.

How should a business choose its baseline year for measuring carbon reduction progress?

A business should choose a baseline year within a 3-5 year span when carbon emissions remained relatively steady (+/- 5%). It should avoid years in which the business implemented many energy efficiency projects (which would inflate reduction achievements), experienced abnormal increases in production, or suffered decreased production such as during Covid-impacted years.

What categories of projects should be considered when creating a carbon reduction project list (Step 3)?

The article outlines four categories: optimizing current systems (e.g., energy efficiency measures, waste heat recovery, HVAC insulation, LED lighting), transitioning to other energy sources (e.g., behind-the-meter solar PV, bioenergy, hydropower, geothermal), adjusting procurement strategies (e.g., purchasing Greenpower from an energy retailer), and offsetting emissions through other contributions (e.g., purchasing carbon offsets like tree planting).

What financial metrics should be estimated for each carbon reduction project?

For each project on the list, businesses should estimate energy, cost, and carbon emissions savings, as well as calculate other financial metrics such as simple payback and net present value (NPV). These parameters are used for target setting and roadmap analysis.

What example of a government carbon reduction target is mentioned in the article?

The article cites the NSW State Government, which has set carbon reduction targets for its state-owned assets to reduce carbon emissions by 50% by 2030 and 100% by 2050.

What is the Science Based Targets Initiative (SBTi) as described in the article?

The Science Based Targets Initiative (SBTi) is a collaboration that provides science-driven tools and guidelines to help businesses establish an emissions reduction plan, allowing them to serve as a model and leader for other businesses in their area and sector.

What should happen after a business completes its carbon reduction roadmap?

Once the roadmap is completed, it's important to get executive sign-off on the strategy and communicate it to the public, since this transparency drives greater incentive to follow through with the plan.

What is the significance of the IPCC Climate Assessment Report mentioned in the article?

The article references the recent IPCC Climate Assessment Report as a reason businesses will need to do more to uphold the Paris Climate Agreement commitment of limiting global temperature increase to well below 2°C Celsius, prompting governments, corporations, and organisations to commit to reducing carbon emissions and achieving net-zero by 2050.

Who wrote this article and what is their background?

The article is attributed to Northmore Gordon, with input noted from Peter Hoang (tagged as a keyword/tag). The site's schema also describes an author named Craig (Craig Morgan), a mechanical engineer with 30 years' experience, including more than fifteen years assisting organisations manage energy, greenhouse gas emissions, and climate change impacts.

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