Calculating Carbon Footprint for Australian Businesses
With climate change becoming an increasingly urgent issue and with Australia’s recent mandatory climate reporting requirements, businesses are stepping up to embrace sustainability. A crucial part of this journey involves understanding and managing their carbon footprint.
This guide breaks down the process, providing practical tips, tools, and insights to help businesses reduce emissions while staying competitive and compliant.
What Is a Carbon Footprint?
A carbon footprint is the total amount of greenhouse gas (GHG) emissions generated by a person, organisation, event, or product. It’s usually expressed in carbon dioxide equivalents (CO2e), combining the impact of various gases like methane and nitrous oxide alongside carbon dioxide.
For businesses, a carbon footprint covers emissions from three key areas:
Scope 1: Direct emissions from things like company vehicles or on-site fuel use.
Scope 2: Indirect emissions from the energy you buy, such as electricity.
Scope 3: Other indirect emissions, including those from your supply chain, employee travel, and waste.
Why Should Your Business Calculate Its Carbon Footprint?
1. Stay on Top of Regulations
The Australian government’s new mandatory climate change reporting requirements mean certain businesses must report their emissions. Knowing your carbon footprint helps you comply and avoid any penalties.
2. Save Money
Tracking your emissions can uncover inefficiencies, like wasted energy or materials. Fixing these not only lowers emissions but can also reduce costs.
3. Build a Stronger Reputation
Customers and clients increasingly prefer environmentally responsible businesses. Addressing your carbon footprint shows leadership and helps you stand out.
4. Prepare for the Future
As climate risks grow, businesses that act now will be better positioned to handle challenges like resource shortages or tighter regulations.
How to Calculate Your Carbon Footprint
Step 1: Define Your Boundaries
Start by deciding what parts of your business you’ll include in your calculation:
Organisational Boundaries: Will you cover all your operations or just specific ones like a subsidiary or facility?
Operational Boundaries: Which scopes (1, 2, and/or 3) will you include? Scopes 1 and 2 are usually mandatory, while Scope 3 offers a more complete picture but can be optional.
Step 2: Gather Your Data
Collect information on all activities that produce emissions. Key areas include:
- Energy Use
Electricity (kWh) and natural gas (m3 or GJ) - Transport
Fuel used by vehicles (litres) and travel details like flights or taxis - Waste
Amount sent to landfill (kilograms or tonnes) and recycling efforts - Supply Chain
Emissions linked to purchased goods and logistics - Water Usage
Volume of water used (kL)
Step 3: Use Emission Factors
Emission factors help convert your activity data into CO2e. In Australia, the Department of Climate Change, Energy, the Environment, and Water (DCCEEW) provides updated factors for different activities, such as electricity use and waste disposal.
For example:
- Electricity: Factors vary by state depending on the energy mix (e.g. coal vs. renewables)
- Transport: Factors depend on fuel type, like petrol or diesel
Step 4: Calculate Your Emissions
Calculate your emissions using the relevant data and formulas.
Step 5: Add It All Up
Combine emissions from all sources to find your total carbon footprint. Break it down by scope and activity to make reporting easier.
Step 6: Verify and Share Your Results
To ensure accuracy, consider having your calculations verified by a third party. Use recognised frameworks for reporting, such as:
- GHG Protocol: A global standard for tracking emissions
- ISO 14064: A certification for GHG inventories and verification
In Australia, businesses that exceed thresholds must report under the NGER scheme.
Tools and Resources for Australian Businesses
1. Online Calculators
Simplify the process with these tools:
- Climate Active Carbon Neutral Certification Tool
- Australian Government’s Energy Made Easy
- WWF Australia’s Carbon Footprint Calculator
2. Software Solutions
Contact QSM Group today to explore how our compliance software portfolio could streamline and enhance your carbon footprint reporting.
3. Consultants
Contact QSM Group for tailored advice around reporting on and optimising your organisations’ carbon footprint and sustainability efforts.
The Benefits of Tracking Your Carbon Footprint
1. Streamlined Operations
Identifying emission hotspots often leads to efficiency gains, saving time and money.
2. Access to Green Funding
Many investors and lenders prefer businesses with strong environmental credentials, opening doors to green loans and funding.
3. Engaged Employees
Sustainability efforts boost team morale and attract like-minded talent.
Overcoming Challenges
- Gathering Accurate Data
Implement strong data management systems and work with suppliers to improve Scope 3 reporting - High Initial Costs
While it takes time and resources to calculate emissions, the long-term benefits far outweigh the upfront investment - Complex Scope 3 Emissions
Focus on major contributors first, then expand gradually to cover more sources
How to Cut Your Carbon Footprint
- Be Energy Smart: Upgrade to efficient lighting and appliances, and audit your energy use regularly
- Switch to Renewables: Install solar panels or purchase GreenPower
- Rethink Transport: Use electric or hybrid vehicles, or promote remote work
- Reduce Waste: Start recycling programs and minimise single-use plastics.
- Offset Emissions: Support verified projects like reforestation or renewable energy
Conclusion
Calculating your carbon footprint isn’t just about ticking boxes for compliance. It’s a chance to make your business more efficient, save money, and be future-proof against climate risks.
By taking the steps outlined here, Australian businesses can reduce their environmental impact, meet regulatory demands, and thrive in a low-carbon economy. Whether you’re starting small or aiming big, the tools and strategies shared in this guide will help you lead the way to a greener future.
Contact QSM Group today to explore how you can leverage our experience and software portfolio to streamline and optimise your carbon footprint reporting.