Estimated reading time: 8-10 minutes.
Imagine a future when your company experiences financial success and sets the standard for environmental responsibility, emerging as a sustainable leader in Singapore's dynamic business scene. The first step towards this future is being aware of and controlling the carbon emissions of your company. Monitoring your carbon footprint may help you gain a competitive edge, win over customers' trust, and fight climate change on a global scale. It's not just about complying with regulations and saving money. As stakeholders and customers place a higher value on environmentally friendly operations, your dedication to cutting greenhouse gas emissions will set your company apart and promote long-term success.
To support SMEs in this journey, Sunollo has launched the GreenStores initiative as part of our Green Movement campaign. This initiative offers tailored solutions for businesses aiming to measure, track, and reduce their emissions. Through Green Stores, we provide comprehensive tools and expertise to help you achieve your sustainability goals. By partnering with us, you can start making meaningful changes that not only benefit the environment but also enhance your operational efficiency and reputation. Contact us to find out how Sunollo’s Green Stores can help your business play a crucial part in the green movement.
This article will cover the fundamentals of calculating your company's carbon footprint, with an emphasis on Scope 1, Scope 2, and Scope 3 emissions.
What is a Carbon Footprint?
An entity's whole emissions of greenhouse gases (GHGs) are measured by its carbon footprint, which is commonly stated in equivalent tons of carbon dioxide (CO2e). Three scopes, each encompassing distinct emission sources, are used to classify these pollutants. A worldwide response is necessary to tackle climate change. Singapore is determined to carry out its share. According to the most recent data available, Singapore's total emissions for 2021 were 53.7 million tonnes. The main industries that contributed to this total were industry (44.4%), power (30.2%), and transportation (14.2%). Identifying the source of our emissions is the first step towards implementing significant change. Singapore hopes to lead the world in sustainability and provide a strong example by focusing on these important industries.
Does your business belong in any of these categories? Continue reading to find out how you can measure, track and and significantly minimise these pollutants.
Scopes of Carbon Emissions
The top-ranking GHG Protocol corporate standard divides a company's greenhouse gas emissions into three categories. Reporting requirements for scopes 1 and 2 are set, whereas scope 3, which is the most difficult to oversee, is optional. Nonetheless, businesses that are successful in disclosing all three scopes will acquire a long-term edge over their competitors.
Scope 1
These emissions are direct greenhouse gas (GHG) emissions from sources owned or controlled by your organisation and associated with your company's operations. These emissions consist of 4 main categories:
- Stationary combustion: Emissions from fuels burned in stationary sources, such as heaters, furnaces, and boilers. Scope 1 must include all fuels that give out greenhouse gases. In Singapore, the refining and petrochemical sectors use fossil fuels, accounting for nearly three-quarters of all industrial emissions. This is the primary source of emissions from the industrial sector.
- Mobile combustion: Emissions from any vehicles owned or operated by a company are included in mobile combustion (e.g. automobiles, vans, trucks). But only automobiles powered by fossil fuels—diesel or gas—are included under Scope 1. A clear benefit lies in using "electric" cars, or EVs, which are not subject to scope 1 emissions since they are powered by electric sources.
- Process emissions (e.g., CO2 production during cement making, factory gases, chemicals) are emitted during industrial operations and on-site manufacturing.
Scope 2
Emissions that involve the purchase of energy, steam, heat, or cooling. They are regarded as an indirect emissions source (along with scope 3) because the emissions originate from the reporting organisation's operations but ultimately happen at sources that are owned or managed by another organisation (in this case, an electricity generator or utility).
Scope 3
Additional Emissions that encompass all other indirect emissions that occur throughout the value chain of a reporting company, both upstream and downstream. These emissions are not directly produced by the company but are a consequence of its activities. Upstream emissions consist of emissions generated in the production and supply chain processes before your company's operational activities. These include purchased goods and services, investment in capital goods like machinery and equipment and carbon emissions from producing products like carbon and steel. On the other hand, downstream emissions consist of those generated after your company’s operational activities, using and disposing of your products and services. For example, if your products are sold and shipped internationally, the emissions from that distribution are part of Scope 3. Scope 3 emissions offer the greatest potential to impact GHG reductions and may be businesses' primary source of emissions.
Which Accounting Standard Should You Use?
By adhering to an environmental standard, you are assured that your method for calculating your carbon emissions is reliable and consistent. Selecting the strategy that will work best for your organisation is crucial. The data you have at your disposal and the intended application of your findings will determine the standard you employ. Numerous globally acknowledged environmental guidelines are accessible to assist your business with the greenhouse gas accounting and reporting procedure. To find out which standard applies to your business, refer to this guide on footprint standards.
Most organisations new to emissions estimates will first focus on establishing their Scope 1 and 2 footprints before addressing value chain (Scope 3) emissions. The process outlined below will focus on Scope 1 and 2 following the GHG Protocol Corporate Standard
Calculating Your Carbon Footprint
The first step is to select and disclose a base year with reliable emissions data. You should select the earliest pertinent period for which you have trustworthy data as their base year. Gathering quantitative emissions data is the next important step in this process, as it will enable you to compute your total footprint precisely.
Establishing your organisational boundary: Before you start calculating your carbon footprint, you must first determine which operations should be included. Establishing an organisational barrier involves a corporation choosing and using a methodical way to combine its GHG emissions. Emissions data can be reported using a control approach or an equity-sharing approach.
- Equity share: Reflects economic interest. Companies report their emissions from operations based on their equity stake in such activities under this method.
- Control Approach: The business is responsible for any emissions resulting from operations that it controls. Control can be characterised as either operational or financial
Choosing wisely in this case requires applying the strategy consistently to guarantee meaningful comparisons of emissions across time.
To compute your company's carbon footprint precisely, you must first translate the gathered data into numbers consistent with an emission factor. The most commonly used method to calculate your GHG emissions follows a simple formula:
Activity data x emission factor = GHG emissions
Activity data is a numerical representation of the actions performed within your company. Common examples are:
- Energy consumption includes the fuels and power that your company uses. Teams responsible for facilities typically have access to this data. Through invoicing, procurement and finance will also have access.
- Vehicle Use: Businesses are required to report emissions from their fleet of vehicles. The differentiation between company-owned and non-owned vehicles is of utmost importance. Emissions from non-owned vehicles must be considered as value-chain emissions falling within Scope 3. This information may come from direct fuel use or mileage claims.
- Fugitive Gases are emissions brought on by greenhouse gas leaks from your machinery or operations. Refrigerants from air conditioners and coolers are typical examples, as they frequently have a significant impact on the environment.
An emission factor reflects the emissions intensity of an operation or activity. The Singapore Emission Factors Registry accessible at the end of 2024, will allow businesses to track and report their emissions more accurately. It will help businesses automate their sustainability reporting process.
Striving for Net Zero Emissions
The goal of net zero emissions is to prevent any net rise in the levels of greenhouse gases in the atmosphere by matching the amount of greenhouse gases emitted with an equal number of removals or offsets. In line with Singapore's Green Plan 2030, which intends to cut emissions from the nation's peak levels by 2050 and achieve net zero as soon as practicable, achieving net zero is essential to reducing the effects of climate change.
Strategies to Achieve Net Zero Emissions
- Invest in Renewable Energy: In Singapore, renewable energy options are limited due to factors such as low average wind speeds, a narrow tidal range and land scarcity. Given these constraints, one of the most viable and rapidly growing renewable energy options in Singapore is solar energy. Making the switch to renewable energy sources can drastically cut the carbon emissions caused by the use of electricity. Examine your options for installing solar panels to provide clean energy on the property, powered by Sunollo. To further encourage the expansion of renewable energy projects, consider acquiring Renewable Energy Certificates (RECs). RECs are a symbol of the environmental benefits of producing energy from renewable sources and can stimulate the market for clean energy.
- Implement Energy Saving Practices: To reduce energy waste, put energy-saving measures into place such as switching to energy-efficient equipment, enhancing insulation, and optimising building designs. Businesses can cut operating expenses in addition to their carbon footprint. With funding from the NEA's Energy Efficiency Fund, Kawarin Enterprise Pte Ltd, a nearby steel manufacturing company, renovated its air compressors, saving over $30,000 in annual costs and reducing over 48 tons of carbon emissions.
- Electrifying Vehicles: Businesses in Singapore are electrifying their fleets of vehicles more often to cut emissions and improve the environment. In Singapore, corporate fleets, taxi services, and delivery firms have begun substituting electric vehicles for their conventional gasoline and diesel vehicles. SingPost, for instance, has become the first postal service in the Asia-Pacific region to commit to a 100% electric delivery fleet. Live pilots with electric three-wheeler scooters and vans have already commenced, marking a significant step towards reducing fuel consumption and greenhouse gas emissions. A thorough EV Roadmap is part of the Singapore Green Plan 2030, which aims to encourage EV adoption.
Singapore has made great progress toward net zero emissions, including enacting a carbon tax in 2019. The carbon tax is applied to all industrial facilities with an annual direct GHG emissions of at least 25,000 tonnes of carbon dioxide equivalent (tCO2e). The tax was recently increased to S$25/tCO2e, and more hikes are anticipated to bring it to S$50–80/tCO2e by 2030. It's time for organisations and people to take action to lessen their carbon impact. The goal of achieving net zero emissions as soon as possible is vital in limiting the effects of climate change, and this effort is in line with Singapore's Green Plan 2030.
Conclusion
Businesses embracing sustainable practices outlined in the Singapore Green Plan 2030 play a crucial role in advancing resilience and eco-friendliness. They mitigate climate change effects by reducing carbon emissions, whether through electric transportation, energy-saving measures, or renewable energy investments. As a part of Sunollo’s Green Movement, Sunollo's GreenStores program can assist businesses in this endeavour by providing tailored solutions and resources to measure, track, and reduce their emissions.
This comprehensive approach not only helps businesses become more environmentally responsible but also enhances their credibility and reputation as leaders in sustainability. Companies that innovate for a cleaner future and align with sustainability objectives can attain a Sunollo Certification which aligns your company with global efforts towards environmental climate action.
