Climate Leaders Formalize Carbon Reduction Efforts

The U.S. EPA’s Climate Leaders program is an industry-government partnership through which organizations develop long-term climate change strategies, set aggressive greenhouse gas (GHG) emission reduction goals, and measure progress. Participating corporations benefit from the program by positioning themselves as corporate environmental leaders, reducing costs through efficiency improvements, and mitigating risks associated with potential regulatory developments. Through the program, corporate partners have access to technical assistance related to GHG emissions inventory preparation and reporting. Participation also enables partners to demonstrate a record of achievement and enjoy the associated positive publicity.

Program Roles and Responsibilities

Success of the Climate Leaders program requires both EPA and corporate partners to make concrete contributions. Partners commit to developing enterprise-wide emissions inventories, setting GHG emissions reduction goals, developing a GHG corporate inventory management plan, reporting annual progress, and publicizing participation, goals and progress. In exchange, EPA provides public recognition to partner organizations through press events, public service announcements, and various speaking engagements. EPA sponsorship of the program provides credibility through transparency and the review process. Finally, EPA provides technical assistance related to inventory preparation and the inventory management plan.

Inventory Protocol

Based on the GHG Protocol developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), the Climate Leaders GHG Inventory Protocol consists of:

  1. Design Principles – overall guidance on defining inventory boundaries, identifying GHG emissions sources, defining and adjusting a base year, defining minimum data requirements and optional reports
  2. Core Modules (required GHG emissions reporting) – direct emissions associated with onsite fuel usage, GHG process-related emissions, and refrigeration and air conditioning, as well as indirect emissions related to electricity and steam purchases
  3. Optional Modules – reporting options related to a partner’s unique emissions and reduction activities such as offset investments, renewable energy, offsite waste disposal, product transport, employee commuting, business travel, and international operations

Reporting requirements consist of the Inventory Management Plan (IMP), the Annual GHG Inventory Summary and Goal Tracking Form, and the review process. The IMP documents the organizations GHG emissions inventory data collection emissions calculations and data storage processes. EPA provides a checklist to assist in the development of the required information and requires completion of the basic components within one year of partnership inception. The Annual Summary must be submitted annually to demonstrate progress toward the emissions reduction goals. It includes CO2e emissions by source type, historical data, and progress toward goals. EPA reviews partners’ IMP and corporate GHG inventory data, including one site visit. Partners that elect to obtain third party certification of their data prior to submittal to EPA can receive an abbreviated review process.

Setting GHG Emission Reduction Goals

Once a partner has completed its base year GHG inventory, EPA works with the company to set appropriate, individualized GHG reduction goals that are corporate-wide (or cover at least all U.S. operations), based on most recent data available, have a 5-10 year timeframe, are expressed as an absolute GHG emissions reduction or reduction in GHG intensity, and are aggressive relative to the appropriate industry sector. EPA individually evaluates each proposed reduction goal against projected benchmark GHG emissions improvement rate for each partner’s sector, looking for goals that markedly exceed the projected benchmark performance for that sector. EPA also considers the partner’s current emissions intensity and those of its sector in order to appropriately account for reductions that the partner has already achieved. The ratio of GHG emissions over an appropriate normalizing factor (typically a physical or economic metric) becomes the partner’s Key Performance Indicator to measure GHG intensity. The Annual inventory data documents progress toward the goal, and once a partner reaches its initial goal, a new goal is set. Of the approximately 160 current corporate partners, EPA reports that 11 have achieved their initial goals. Of the remaining group, about half have set goals and half are in the process of goal development.

PARTNER PROFILES

Broad Commitment to GHG Reductions

We Energies’ Manager of Environmental Policy, Kris McKinney, spoke about his company’s participation as part of a strong overall commitment to a multi-emissions reductions strategy that the electric power utility company has pursued for over a decade. On the same day that We Energies joined Climate Leaders as a charter member, it signed a voluntary agreement with the State of Wisconsin to reduce emissions of NOX, SO2, and mercury. We Energies is also a long-time participant in the DoE’s Climate Challenge Program and launched “Power the Future” in 2000, a broad strategy related to retiring older, less efficient facilities and investing in more efficient new generating facilities including renewable energy sources. Through its efforts, We Energies has documented reductions of more than 44 million tons of GHG emissions, representing about two years worth of emissions. The company continues to explore further emissions reductions opportunities through efforts such as a demonstration project using a chilled ammonia scrubber to capture as much as 90 percent of CO2 emissions.

Cutting Costs and Reducing Emissions

Tenneco, Inc., an auto parts manufacturer with 85 facilities worldwide became involved in the Climate Leaders program in 2004 as an outgrowth of its participation in the Business Roundtable’s Climate Resolve initiative. Executive Director of Environment, Health & Safety, Tim Gordon reported that Tenneco’s primary objectives were to pursue a systematic approach to carbon management and to prepare for future regulatory development. With minimal corporate staff, Tenneco has benefited from EPA’s technical assistance with the development of the baseline inventory and the Inventory Management Plan. To date, Tenneco’s carbon reduction efforts have been largely focused on improving energy efficiency. Each of its 30 North American facilities that are included under the program have been analyzed to identify opportunities for reducing energy consumption, the results of which are expected to reduce the company’s operating costs and its carbon footprint.