1. Product carbon footprinting: Background, development and application Dr Graham Sinden Carbon Footprinting and Agriculture Seminar Australian High Commission, March 2009

2. Agenda Global emissions and emissions assessment PAS2050: Development Consumer understanding and communication Next steps: International

3. Global GHG emissions and emissions assessment Current international discussion centres around a production view of emissions –Global emissions are sum of emissions produced by all countries –The Kyoto Protocol focuses on emissions produced inside national borders –In Europe, the EU Emissions Trading Scheme seeks to cap the production of CO 2 emissions within Europe –similar for JVETs in Japan, and CPRS in Australia By establishing a “cost of carbon” on GHG emissions arising from production within a country: –Consumption of domestic production will have a cost of carbon included –Consumption of foreign production will not be affected by a carbon cost However, a “cost of carbon” may also result in perverse outcomes: –The relocation of emissions intensive industries outside of carbon-valuation zones such as the EU ETS ( “leakage”) –Relocation of industry may have competitive, economic and security impacts –Total global emissions may increase –Poorer regulation in leakage countries; and –Potential overall increase in consumption through lower prices in importing countries –Leakage may result in the appearance of GHG emission reductions

4. Production, consumption and emissions assessment in the UK When measured on a domestic production basis, UK emissions appear to have fallen –However, on a domestic consumption basis, emissions have risen Domestic production emissions (12% drop) Net imported CO 2 emissions Source: Helm, Smale & Phillips (2007) – Too good to be true; the UK’s climate change record Total UK emissions have risen 19% since 1990.

5. Emissions assessment and supply chain carbon footprinting (I) Emissions have the same impact on the atmosphere, irrespective of country of origin –However, a production view of GHG emissions can be very deceptive for both net producer, and net consumer, countries Supply chain carbon footprinting addresses this issue –Whole of life cycle assessment –All emissions, irrespective of –Country of origin –Country of use –Country of end-of-life Supply chains are complex, and the products arising from them are often the result of inputs from many countries. –Supply chain carbon assessment takes a consumption view of emissions, including emissions from the whole life cycle.

6. 6 Emissions assessment and supply chain carbon footprinting (II) Innocent Smoothies Establishing an internationally agreed supply chain carbon footprinting approach will support effective decision-making regarding emissions assessment and reduction.

7. Agenda Global emissions and emissions assessment PAS2050: Development Consumer understanding and communication Next steps: International

8. Standards settingCompany engagement PAS2050 Code of Good Practice Further internationalisation work How we are going about it Product footprinting Certification Reduction planning Communication (including Carbon Reduction Label) Carbon Trust InsightsCarbon Label Company

9. What is PAS 2050? PAS 2050: Specification for the assessment of the life cycle greenhouse gas emissions of goods and services Provides an agreed method of assessing product GHG emissions –Common approach to supply chain carbon assessment –Links to existing (ISO14040-44, 14064 & 14025) standards PAS 2050 is co-sponsored by the Carbon Trust and the UK Department for Environment, Food and Rural Affairs (Defra) –BSI is the project manager –A Steering Group and workgroups have been established –The Carbon Trust is the Technical Author –The Carbon Trust and Defra have joint sign-off The Carbon Trust is supporting additional activities –Code of Good Practice for Product GHG Emissions and Reduction claims –Guidance on implementing PAS 2050

10. PAS2050 consultation activity First draft method launched in March 2007 Relationship with Defra and BSI to develop PAS 2050 established in June 2007 Independent Steering Group established Series of workgroups established (e.g. data, agriculture, serices, etc) Key stakeholder and review panel consultation: –September-October ’07: 1 st Consultation –Around 180 participants (academic, business, government, NGO, etc) –International engagement –February-March ’08: 2 nd Consultation –Around 980 participants (Similar spread of sectors) –Greater international engagement –Includes key experts Additional consultation activity, including: –Workgroups –Pilot partners –Ad-hoc interaction

11. PAS2050 consultation activity: Pilot partner programme Three rounds of pilot partners announced –Currently working with around 25 companies Working with companies that represent a wide range of products –Trialling the implementation of the draft PAS2050 method –Provide feedback on practicality of implementing PAS2050 Some companies will trial a carbon label –Already in the marketplace for selected products

12. 12 Consultation plus pilot project countries

13. Reduction & Communication Guidance Development of Code of Best Practice for Reduction and Communication –Developed to promote further consistency in carbon footprinting –Details reporting requirements and viable claims –Requirements for demonstrating reduction over time, including banking What does a meaningful carbon footprint reduction look like? –Absolute targets: XgCO 2 e or X% –Business systems & management How should the information be communicated? –Where?: On pack, point of sale, website, annual report, other… –What?: Current footprint, historical reduction, intent to reduce, other… –How?: numbers, rounded numbers, traffic lights, A-G, … Guidance for PAS implementation –Aimed at the non-expert; Facilitates implementation of the PAS

14. Standards and supporting information BSI PAS2050: Product carbon footprint measurement standard Carbon Trust Code of Good Practice for Product GHG Emission and Reduction Claims: Guidance for communicating carbon footprint results, and for setting and assessing GHG reductions over time Business Opportunity: Highlights our experience with carbon footprinting, including case studies. PAS Guide: Implementation of PAS 2050, written for non- experts

15. Agenda Global emissions and emissions assessment PAS2050: Development Consumer understanding and communication Next steps: International

16. Demand for better information on companies’ environmental behaviour is high –Over 75% agreed with the statement ‘if I had more information about companies’ social, environmental and ethical behaviour this would influence my decisions about what I buy’ Ipsos Mori, nVision. Base: 1057 people aged 16+ in the UK, 2007 Consumers remain sceptical of green claims currently being made business –Nearly 60% say claims by manufacturers and retailers are either ‘not very’ or ‘not at all’ credible. YouGov “L.E.K. Consulting Carbon Footprint Report 2007”, 2,039 UK consumers 71% of consumers would value an independent assessment of a companies low carbon footprint claims –GfK NOP Oct 2006. Base: all adults aged 16+ 67% say they are more likely to buy a product which has a low carbon footprint –GfK NOP Oct 2006. Base: all adults aged 16+ What are consumers expecting companies to do?

17. The Carbon Reduction Label

18. The label appeared first on three products Who?What?Where? Cheese & Onion Crisps Botanics & Ingredients Shampoo Mango & Passion- fruit Smoothie On pack Point-of-sale Website

19. Evolving communication Following Walkers, Boots & Innocent Drinks… Tesco using the label on 20 own-brand products across: –Orange juice –Potatoes –Washing detergents –Light bulbs Other partners committed to trialling the label in future –Morphy Richards –Mey Selections –Continental Clothing –Halifax –Others to follow in UK and elsewhere …

20. Applied in many different industries

21. Agenda Global emissions and emissions assessment PAS2050: Development Consumer understanding and communication Next steps: International

22. International standard development: Timing Differing time scales create the opportunity to ensure comparability –PAS 2050 published, and its review will co-inside with the completion of the World Resources Institute and World Business Council for Sustainable Development’s (WRI/WBCSD) work ISO process has the opportunity to incorporate the experience of both the PAS 2050 and WRI/WBCSD development processes, and the experience of companies implementing PAS 2050 in practice, in its drafting of a new standard. 2007 2008 2009 2010 2011 2012 PAS 2050 WRI/WBCSD ISO Review Need to ensure that there is consistency between the different initiatives.

23. Further information: Dr Graham Sinden Technical Manager graham.sinden@carbontrust.co.uk www.carbontrust.co.uk