In our last post, we talked about how a greenhouse gas management program mitigates the risks associated with future regulatory changes. We also talking about its usefulness as a cost mangemnent metric. Today, we will get into the basic steps of the greenhouse gas mangement process.

Greenhouse Gas Management at a Glance

A greenhouse gas inventory will likely include the following steps. 

Step 1: Determine Boundary Conditions: Clearly define the organizational and operational boundaries of emission inventory.

Step 2: Determine Scope of Inventory: Define the level emissions included in the inventory. Emissions are generally placed into 1 of 3 different scopes.

• Scope 1 -Direct emissions from on-site combustion and other on-site sources)
• Scope 2 -Indirect emissions from electricity use via a utility provider where emissions occur remotely.
• Scope 3 -Emissions from business travel, contractor emissions and other supply chain related emissions

Step 3: Identify specific Greenhouse Gases that require inventorying/reporting: At a minimum an inventory should include the following.

• Carbon dioxide (CO2)
• Methane (CH4)
• Nitrous oxide (N2O)
• Hydrofluorocarbons (HFCs)
• Perfluorocarbons (PFCs) and
• Sulfur hexafluoride (SF6).

Step 4: Determine baseline year and reporting period of inventory: Establishes a benchmark to compare to over time

Step 5: Determine source categories to be included in inventory: Identify general sources for emissions

Step 6: Determine GHG inventory protocol and approved methods to quantify GHG emissions: Elect appropriate emissions calculation methodologies and activity factors and identify necessary calculation tools. 

Step 7: Request and collect source data

Step 8: Calculate GHG emissions: Emissions of GHGs are calculated by multiplying an activity rate or underlying material base quantity by a GHG-specific emission factor

Step 9: Quality Assurance and Quality Control: Review collection calculation methods

Step 10: Generate GHG emissions inventory report: Compile into a report 

Once the greenhouse gas inventory is complete an organization can begin to:

• Track and manage emissions to determine cost-effectiveness
• Prepare of emissions inventories
• Create dashboards displaying their real time emissions
• Plan strategy in a cap and trade environment
• Adapt to organizational and regulatory change

While the benefits of implementing a greenhouse gas management program may not be realized for years, the value created from reducing your exposure to the price volatility of fossil fuels and the risks mitigated in preparing for aggressive future regulations is clear.  

Coming Up Next:

Join us next time as we wrap up on energy series.

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Tim Fain is an Associate Partner and Service Area Leader within IBM’s Global Business Services Public Sector. Mr. Fain has more than 30 years of technical, managerial, and consulting experience. Specifically his experience involves developing organizational, economic development and environmental and energy sustainability strategies; improving business models and processes; and helping organizations develop transformation roadmaps. He uses his extensive knowledge of Federal regulatory and budgetary processes, e-Government principles and methodologies, and strategic planning to help public sector clients address policy, service, and transformational challenges.

Prior to joining IBM, Tim spent eight years at the Office of Management and Budget where he worked on a broad range of Federal government information technology and policy issues. A former US Navy Submarine Officer, Tim holds a BS in Metallurgical Engineering, a MA in National Security Studies, and a MPP in International Trade and Finance.

Tim Fain (tfain@us.ibm.com)

Brian Dunne is a Consultant with IBM’s Strategy and Innovation practice. He has been actively involved in S&I’s environmental offerings development since he joined IBM in 2009. Mr. Dunne studied Economics and Political Science at James Madison University. Brian Dunne (Brian.Dunne@us.ibm.com)

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