For global organisations, scope 2 dual reporting can be nothing short of a nightmare. The guidance is complicated, the terminology unfamiliar and the global availability of information hugely variable. Organisations risk material misstatement of their market-based emissions if they don’t get their approach right.
With all these challenges at play, it can be tempting for environmental reporting managers to request as much utilities billing / evidence as possible from regional reporting teams and attempt to co-ordinate market-based reporting from the centre. This is a common and costly mistake for a few reasons – the time consumed in trying to process high volumes of evidence, the challenge of translation, and lack of understanding of the local energy landscape.
So here are my top five tips for global organisations trying to source market-based conversion factors:
- Empower each market – your regional reporters can be your local experts; with the right training regarding the conversion factor hierarchy and acceptable quality criteria they can, and should be, responsible for retrieving the required market-based factors
- Provide context – invite regional reporting representatives to a training workshop – help them to understand what market-based reporting is, the benefits of getting it right, and your organisations’ wider strategic energy roadmap
- Start with the basics – some regional reporters may never have seen their utilities bills, or know where to find them. The first questions to ask are whether there is any evidence related to energy purchases available; or if it is even possible to purchase market differentiated energy in that region
- Leverage your procurement team – where reporters need to get in contact with their energy providers to source supplier specific conversion factors, they should go through their procurement team, raising the question with dedicated accounts managers – this will be far quicker than contacting a utility providers’ customer services
- Admit defeat (eventually) – where it’s not possible to source market factors specific to your purchases; remember, residual factors and location based factors can be used as a default- effort need to be proportionate to material gain
Scope 2 reporting is in its infancy – globally, utilities providers aren’t necessarily ready to respond to their customers’ requests for information; particularly where regulation hasn’t forced the issue (the UK has the Fuel Mix Disclosure Regulations that requires utilities companies to disclose information on standard tariffs for example). Over the coming years, the market will mature; but in the meantime, regular communication and engagement with regional teams is the best recipe for success.
“The scope 2 workshop was insightfully presented. The exercises included were particularly good, as they give you the occasion to ‘get your hands dirty’.”
-Neil Quayle, Corporate Responsibility & Sustainability Analyst, Capgemini
Julie Craig regularly delivers Carbon Smarts’ scope 2 masterclass for organisations wishing to engage their global reporting teams. Get in touch to discuss your training needs: email@example.com or 020 7048 0450.