The most common carbon hotspots for any business

Reducing emissions across business operations requires an understanding of where the most significant emissions occur, also known as "emission hotspots." These hotspots vary widely depending on the industry. For instance, a logistics firm might have major emissions from its fleet, while a fashion brand might see higher emissions in its supply chain.

Despite these sectoral differences, there are common areas where most businesses can take action to reduce their environmental footprint. Here’s an in-depth look at typical emission sources, broken down by scope, along with effective strategies for reduction.

Scope 1

Heating

Heating is a primary source of emissions for many businesses, especially in regions with colder climates where substantial energy is required for space heating.

One of the most effective ways to reduce heating emissions is to improve energy efficiency. This could involve upgrading to high-efficiency boilers, improving insulation, or installing programmable thermostats that optimize temperature control based on occupancy, ensuring that heating is reduced when spaces are unoccupied.

Additionally, renewable heating technologies such as heat pumps or biomass boilers can provide substantial emissions reductions compared to traditional gas or oil heating systems, though they may require a more significant initial investment.

Fleet Emissions

For businesses that operate a vehicle fleet, such as logistics firms or service providers, transportation is a major contributor to Scope 1 emissions.

Shifting to electric vehicles (EVs) is an increasingly viable solution as EV technology improves and government incentives are introduced. In the UK, for example, there are grants available for businesses that invest in EVs, helping to offset the initial costs.

Besides electrification, optimizing routes and implementing mileage reduction strategies can also reduce emissions. Fleet management software can help businesses plan the most efficient routes, reducing fuel consumption and emissions over time.

Scope 2

For many businesses, especially those in the manufacturing industries, electricity use in workplaces is a major source of emissions.

Implementing energy efficiency measures is a straightforward way to reduce this impact. Simple changes, such as switching to LED lighting, using energy-efficient appliances, and installing motion sensors, can all make a difference.

Beyond efficiency measures, businesses can also consider switching to green energy tariffs. While these tariffs allow companies to claim a portion of their energy from renewable sources, it's worth noting that the impact varies by provider and region. Some green tariffs contribute more meaningfully to renewable energy generation than others, so it’s essential to research and choose a reputable supplier.

Scope 3

Supply Chain

The supply chain often represents the most significant portion of a business's carbon footprint, especially for industries reliant on raw materials or extensive manufacturing.

In cases where immediate changes are possible, businesses can make more sustainable choices that lead to immediate emission reductions, such as opting for recycled materials in manufacturing or purchasing refurbished IT equipment.

Otherwise, reducing emissions in the supply chain can be complex and requires cooperation with suppliers. Engaging with suppliers to understand their sustainability credentials is a critical first step. Establishing sustainability criteria for suppliers and periodically reviewing their environmental practices and progress with emission reduction can also drive gradual improvement across the supply chain.

Business Travel

Business travel is another significant source of Scope 3 emissions, particularly for companies that rely on frequent flights.

One strategy to reduce these emissions is to establish rules around when business-class flights are necessary, as business class has a higher carbon footprint per passenger than economy. This is because of the extra space business class passengers occupy on the flight!

Additionally, adopting virtual meetings as an alternative to in-person gatherings where possible can reduce travel needs.

To further incentivize low-emission travel options, companies might consider offering rewards for employees who choose sustainable transport options or setting up salary sacrifice schemes that support EV purchases, such as those offered by the Electric Car Scheme.

Employee Commuting

Employee commuting emissions can be minimised by selecting office locations that are easily accessible by public transport, encouraging carpooling, and providing salary sacrifice schemes for electric vehicles. Additionally, cycling incentives, such as participation in a cycle-to-work scheme, can encourage more employees to opt for low-emission commuting options.

Homeworking

With the rise of remote work, homeworking has become an increasingly relevant component of Scope 3 emissions.

Developing a sustainable working-from-home policy can help reduce emissions in the home environment. For instance, businesses can encourage employees to use energy-efficient appliances, avoid excessive heating, and make responsible choices in waste management. Offering support or guidance for sustainable home office setups can help align employees' home energy use with company sustainability goals.

Waste Management

Waste disposal contributes to emissions, especially when organic waste decomposes in landfills, releasing methane.

Establishing robust recycling programs for common waste items like paper, food, and electronic waste can help reduce landfill emissions. If local authorities do not provide adequate recycling options, businesses can partner with third-party waste management services to ensure waste is properly handled and recycled. By separating waste streams and promoting responsible waste practices, businesses can significantly lower their Scope 3 emissions from waste.

Third-Party Distribution

For businesses that rely on external partners for distribution, such as retailers and e-commerce companies, choosing sustainable logistics providers is crucial. Vetting suppliers to ensure they use fuel-efficient or electric vehicles for deliveries can help minimize emissions associated with product distribution.

Whenever possible, prioritize ground transportation over air freight, as air transport is approximately 100 times more carbon-intensive per kilogram of goods shipped. Partnering with distribution providers that share your sustainability values is one of the most effective ways to reduce emissions in this area.