On day two of Cloud Expo in London, a panel of academics and industry execs addressed the need for companies to get serious with Carbon Accounting, exploring the benefits and warning of the risks that plague the issue.
Opening the session, Dan Scarbrough of Stelia highlighted the obvious to the audience: climate change is coming, but followed up by explaining how businesses need to get onboard too.
This is because many countries around the world, in the race to reach net zero, have implementing upcoming legislation and ESG requirements that will compel companies to report their emissions and pay penalties for those not meeting them.
With the electronic industry producing almost 25 kg of carbon for 1kg of electronics – and with other 15 billion IoT devices worldwide – the 4% of global greenhouse gas emissions the industry produces will increasingly become a point of concern. Equally, the companies hosting the Cloud data centres, pivotal to the operations for billions of IoT devices, have significant energy consumption and carbon footprints – placing them at the heart of the sustainability conversation.
But issues remain in not only the accounting, but the business models and indeed the financials of implementing change. “Carbon accounting in the tech sector, particularly for companies operating data centres, is a complex challenge. We need tools and strategies that can help us navigate this space effectively,” explained Scarbrough.
In carbon accounting, emissions are classified into three scopes for comprehensive management. Scope 1 encompasses direct emissions from sources a company owns or controls, like fuel combustion or company vehicles. Scope 2 covers indirect emissions from the generation of purchased electricity, heating, and cooling. Scope 3, the broadest category, includes all other indirect emissions within a company’s value chain, such as the production of purchased materials and waste disposal, capturing upstream and downstream activities. Although classification helps organisations identify their environmental impacts, keeping track of them is part of the difficulty.
“There are 15 categories of Scope 3 and therefore all industries and all sectors haven’t got down into the deep and dirty detail of what it means,” explains Professor Andrews.
Alongside a call for greater legislation and standardisation on what must be met for carbon accounting, Professor Andrews also emphasised how business models of these companies, particularly in terms of recycling electrical products through the use of comprehensive lifecycle assessments, must change in order to reduce environmental impacts.
Although companies have a reason to change to more considerate carbon practices, including a new ruling by the EU that will require carbon credit certification schemes to demonstrate compliance with the EU Carbon Removal Certification Framework, Wynne, however, questioned how deep companies will really go: “Superficially yes, I think that the manufacturers have got a hold of the message of product life extension and a lot of them have circular offerings. But I think the problem is that it’s difficult to turn those juggernauts around. It’s difficult for a manufacturer to become a circular manufacturer at scale.”
Long followed up by saying a change will be needed across the sector in order to make it viable for businesses and their customers, stating: “It is more expensive to purchase recycled raw materials in some cases than primary extraction. That equation has to change. It should be cheaper to get recycled.”
Concluding on a high note, however, many of the audience had put their hands up to the question: ‘Do you know if your company does carbon account?”, highlighting how panel there is a collective drive within the tech industry towards more sustainable operations.
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