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4 September 2019 Article

The Greenhouse Gas Protocol Explained

Klappir’s approach to smart environmental management uses The Greenhouse Gas Protocol as a point of reference. Which, of course, sometimes leads our customers to ask: But what is the Greenhouse Gas Protocol? That’s a very good question. We decided to provide an answer once and for all in a series of articles on the topic. This is the first one. We hope you find it both useful and enjoyable.

By Anton Birkir Sigfússon

Greenhouse Gas Protocol 101

Simply put, The Greenhouse Gas Protocol, also know as GHG Protocol, collects the standards, guidelines and tools for accounting and managing GHG emissions. The objective of the Greenhouse Gas Protocol is to render companies, governments and organisations more efficient, resilient and prosperous by establishing a comprehensive, global standardised framework for measuring and managing GHG emissions. The overarching goal of the GHG Protocol is therefore to reduce emissions and control the six anthropogenic (human-emitted) greenhouse gases outlined in the Kyoto Protocol (Japan, Dec. 1997).

Reduce the world’s greenhouse gas emissions or suffer the consequences of poisoning the Earth’s atmosphere and oceans.

An overly simplistic view of a complicated and controversial topic. The following article is not about climate change per se or opinions regarding. The aim is to thoroughly explain the GHG Protocol, emphasise how the accounting and reporting actually works, and shed light on how we at Klappir assist businesses in achieving their environmental aims.

The Story Behind the GHG Protocol

We need to establish a little bit of context before diving into the GHG Protocol itself. In 1998, the World Resource Institute (WRI), a U.S.-based environmental NGO (non-governmental organization), and the World Business Council for Sustainable Development (WBCSD), a Geneva-based coalition of 170 international companies, convened the Greenhouse Gas Protocol Initiative. The mission of the GHG Initiative was to develop an internationally accepted GHG accounting and reporting standard for businesses based on the international treaty signed in December 1997, the aforementioned Kyoto Protocol.

The history of greenhouse gas research can actually be traced back much further, all the way to the beginning of the Industrial Revolution. In 1852, after investigating numerous environmental issues, a Scottish chemist named Robert Angus Smith exposed the relationship between acid rain and atmospheric pollution in Manchester, England. Smith published his research in a book entitled Air and Rain, the Beginnings of Chemical Climatology (1872), where he coined the term “acid rain”.

Nearly a century later, with pollution rising every year, the Parliament of the United Kingdom enacted the Clean Air Act 1956, primarily in response to the Great Smog of London that killed an estimated 12,000 people and hospitalised 150,000 more with respiratory illnesses. Around the same time, across the Atlantic, the Air Pollution Control Act of 1955 was the first piece of US legislation where air pollution was identified as a national problem. The Clean Air Acts of 1963, 1970, and 1990 further emphasised emissions standards and funded research into solutions in the United States.

The GHG Corporate Standard

The multi-stakeholder partnership that is the GHG Protocol Initiative comprises two separate but linked standards: The GHG Protocol Corporate Accounting and Reporting Standard (PDF) provides a step-by-step guide for companies to use in quantifying and reporting their GHG emissions; and The GHG Protocol for Project Accounting supplies a guide for quantifying reductions from GHG mitigation projects.

We are going to focus on the Corporate Accounting and Reporting Standard (GHG Protocol Corporate Standard) for the purposes of this article. First published in 2001, the GHG Protocol Corporate Standard was accepted and embraced by business, NGOs, and governments around the world. The Corporate Standard soon became the basis for those governments, NGOs, and companies to structure their industry specific accounting and reporting systems, as well as calculation tools.

The GHG Protocol Corporate Standard includes the measurable standards and guidance for companies, governments, and organisations to prepare a GHG emissions inventory. The Corporate Standard focuses on the accounting and reporting of emissions through the development of a verifiable inventory. A standard for the verification process of the inventory is not provided.

The Corporate Standard is made up of five standards plus the guidance for attaining each standard. This article is only meant to introduce the GHG Protocol Corporate Standard; We will further explore each of the five standards in our series of follow-up articles.

GHG Emissions Inventory

From a business perspective, the GHG emissions inventory is the essence of the Corporate Standard. GHG emissions sources identification and mitigation projects are the key elements of the process. The Corporate Standard should not be used to quantify the reductions associated with the mitigation projects for use as offsets or credits. The forthcoming GHG Protocol Project Quantification Standard will provide the standards and guidance for this purpose.

The Klappir Sustainability Platform is the solution for monitoring and tracking GHG Emissions Inventory. The Sustainability Platform smart environmental management system is a web-based solution that streams emissions data sourced directly from service providers in near real time, as well as consistent and transparent GHG accounting and reporting over time. Another excellent feature is the deep diving analytics that are used to focus operational business decisions on what matters most.

The GHG emissions inventory is used to account and report on the six greenhouse gases outlined in the Kyoto Protocol: Annex A. Carbon dioxide is the major contributor, making up more than 80% of the total GHG emissions, while Methane and Nitrous Oxide contribute about 15 – 17 % together depending on the economic sector. The HFCs, PFCs and Sulphur hexafluoride are grouped together and labelled Fluorinated gases that comprise about 3 % of the total. However, these are considered High Global Warming Potential gases (High GWP) with harmfulness up to 23,000 times greater than carbon dioxide.

Wrap up

The GHG Protocol Corporate Standard is a definitive advantage for any company, government, organisation, university or other that wants to set the pace in GHG emissions awareness and carbon footprint reduction. In May of this year, Nasdaq officially launched their new global Environmental, Social, and Governance (ESG) reporting guide for public and private companies. The ESG reporting is considered the non-financial side of business operations (although plenty of financial health can be discovered through this reporting) and many investors worldwide are beginning to appreciate the need for broader consideration of all business practices, not just financial prospects and operational performance. The GHG Protocol is an excellent weapon to use in the strategy to provide as much accuracy and transparency in environmental accounting and reporting.

Klappir Green Solutions

Our carbon accounting tool is the foundation of our web-based Sustainability Platform that is expertly designed for managing the GHG Protocol Corporate Standard. The ESG Statements provided from the data collated in the carbon accounting tool define the Scope 1,2,3 emissions data in convenient graphs and tables for easy distribution to organisational stakeholders and potential investors.

By Anton Birkir Sigfússon4 September 2019

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