Carbon cuts make top of the league

Heavy industries aiming to clean up their green credentials or boast of their emissions record can now test their claims thanks to an innovative new climate change tool.

Atkins Environment has launched its Carbon Benchmark (CarBen) tool so companies can see how they are performing against

corporate rivals.

Although there are already systems available to evaluate a company’s emissions record, CarBen will compile an anonymous ‘league table’ of participating companies so newcomers can see if they are keeping up with competitors.

Participating firms will be evaluated in eight key areas and receive a percentage rating – school report style – in each area. These figures will then be used to produce a final rating for the company’s overall performance, with the aim of reaching the magical 100 per cent.

Atkins Environment’s climate change team has been working on the project for four months and Steve Messner, Atkins’ principal consultant for climate change, says the result was an extremely versatile tool: “There are a number of key industrial sectors where we can use CarBen to do the best evaluation work,” he explains. “It is set up to deal with the biggest emitters and contributors to greenhouse gases in industry.”

The developer of CarBen says the tool can be used in the power industry, food manufacture, process and retail, the automobile industry, banking and financial, chemicals, metals and mining, oil and gas, paper and pulp and transport: “It’s really to try and reach out to corporations who might be struggling with strategies and to provide a hard analytical edge.

“A lot of companies are just talking about emissions in a piecemeal fashion, but without looking at all the elements they cannot see what their overall financial and reputational risks are.”

CarBen will directly aid companies taking part in the EU Emissions Trading Scheme. Emissions trading laws set limits on carbon dioxide emissions from energy intensive sectors of the economy. Companies reducing emissions below their limit will be able to sell their successful margins to under-achieving companies as credits or bank them, depending on the price at which credits are traded. The aim

is to provide companies with a direct financial motivation for cut-

ting emissions.

The European Commission will examine the law in 2004 and 2006 with a view to rolling out trading

to other sections of

the economy.

The eight key areas examined by CarBen include risks associated with emissions, remedial activities and an analysis of companies’ energy efficiency. The head of the climate team gives an example of CarBen’s practical application: “The risk indicator looks at the direct implications of European emissions trading and the future Kyoto agreement,” he says. “We then look at the longer-term implications of climate change.

“In terms of energy efficiency (we ask if the company) has done a standard energy use audit of their facilities and to what degree they have integrated the latest process equipment modifications – something else Atkins can help with.”

Environmental concern

Some may wonder how eager big businesses – especially in the heavily polluting industries – will be to get their house in order and risk coming up short with the CarBen tool. But clients are increasingly concerned by the issue of climate change and businesses claim to share those worries according to a recent survey.

The results of the Carbon Disclosure Project showed 8-out-of-10 FT 500 companies who responded, agreed climate change posed a significant risk. With less than half of those respondents taking externally recognised actions on such risks, the developer of Carben anticipates an encouraging response for its product. This view has been echoed by Jonathan Thomas, manager of the joint DTI/DEFRA Climate Change Projects Office: “There’s more and more pressure on business to manage carbon emissions,” he says. “The European Union carbon emissions trading scheme will start in 2005 and will cost companies unless they can assess their emissions.

“Most of industry doesn’t have controls at the moment, but when the scheme starts there will be binding limits on around 40 per cent of

emissions with severe penalties of about e100/ton over their allowance.

“I think when emissions affect the balance sheet, the importance of the CarBen tool will be realised.”

Nick Marshall, global product manager for greenhouse gas emissions verification products at the British Standards Institute, also welcomes CarBen: “Any tool that is produced to assist organisations in benchmarking their carbon profile is a bonus,” he says.

“It is useful for organisations who are uncertain in terms of their risk.

“If they can benchmark themselves against their peers in their industrial sector, it will provide them with the guidance as to whether they are on the right track or not.

Charles Eyre, of Aon Risk Consulting, cautiously welcomed the new product after it was launched at Atkins’ Euston Towers, London office: “I think there is a need for a tool and it is a question of how accurate and how sensitive it will be.” He adds: “Benchmarking is useful up to a point but obviously how the resulting information is used is what is important.”

Atkins Environment’s climate change team is expecting clients to come forward and take the CarBen ‘challenge’

in the wake of a successful launch.