Carbon claims can be load of hot air

03 May 2007Archived News Energetics in the News

PUBLISHED: The Age - By Leon Gettler - Cheryl Bowler, Principal Consultant, Energetics Pty Ltd was asked by The Age to comment on the potential risk of not following robust procedures for going carbon neutral.


COMPANIES going carbon neutral risk a shareholder backlash and accusations of "greenwashing" - the term for window-dressing by governments or businesses aimed to make them look environmentally friendly - if they fail to do it properly.

Sydney energy consultancy, Energetics says there are no mandatory standards for what carbon neutrality actually entails.

As a result, claims by companies that they are going carbon neutral might be meaningless and misleading.

Businesses, for example, can start by calculating their direct operational emissions from electricity, gas and transport use. However, many fail to do an audit calculating emissions from other sources such as paper, waste generated and outsourced activities.

Energetics has also warned that the strategy of buying carbon offsets to alleviate the damage done to the environment by their fossil-fuel-driven cars, air travel and electric appliances is not a sustainable long-term strategy.

Cheryl Bowler, principal consultant on carbon markets at Energetics, said: "There's a lot of flexibility in how you assess standards and I guess people are taking whatever interpretation of their boundary that's most favourable.

"They tend to focus too much on what's happening inside their building and not outside. I don't think any of the organisations have announced how they are calculating their footprints, so it's a bit vague."

Australian companies that have announced they are going, or are have turned, carbon neutral include Fuji Xerox Australia, HSBC, Australian Ethical Investment, VicSuper, NAB, IAG, ANZ, Saab Australia, KPMG and the Australian Football League.

The Australian Conservation Foundation (ACF) yesterday raised questions about ANZ's declaration that its Australian and New Zealand operations would be carbon neutral by 2009.

ACF's acting director of sustainability strategies, Charles Berger, said questions needed to be asked about why ANZ's carbon neutrality extended only to its Australian and New Zealand operations, but excluded other parts of the Asia-Pacific region and Papua New Guinea.

"It's a concern when a financial institution in a wealthy country is adopting environmental protection measures that apply only in the wealthy countries and not to its operations in less affluent areas around the world," Mr Berger said.

An ANZ spokeswoman said the bank's blueprint for carbon neutrality covered the bulk of its operations, which were in Australia and New Zealand, and 97 per cent of its greenhouse gas emissions in Australia came from its premises.

She said the bank planned to extend the carbon neutral strategy globally but had yet to set a date. It was working on getting accurate and meaningful data from overseas to do this.

Ms Bowler said part of the problem was that many companies did not know greenhouse gases apart from carbon dioxide.

While carbon dioxide makes up 74.3 per cent of Australia's greenhouse gas emissions, the rest include methane, from landfill sites and flatulent cattle (accounting for 20.2 per cent of national emissions), nitrous oxide, from vehicle exhaust fumes; perfluorocarbons, produced in the making of semi-conductors; hydrofluorocarbons, used for refrigeration; and sulphur hexafluoride, a by-product of aluminium manufacturing and the electronics industry.

Ms Bowler said waste, which contributed to methane gas emissions, was a key area overlooked. "Not only do they forget about it but it's very difficult to measure," she said.

"Waste tracking is poorly measured in corporate Australia. General rubbish that goes to landfills; such as paper, cardboard, toners etc are very difficult to track."

Other potential greenhouse-gas-emitting areas disregarded could include outsourced activities, functions, hotel rooms and marketing materials. "If you outsource your IT to India, who's accounting for the electricity use in the call centres?" Ms Bowler said.

An Energetics' report, The Reality of Carbon Neutrality, warns that companies could face a backlash if their claims of carbon neutrality were found wanting.

"Companies should be aware when they consider proclaiming their carbon neutrality, based on a less rigorous approach than the one outlined above, that there is a real reputation risk for boards and executives of accusations from civil society of greenwash," the report states.

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