The webinar was held by EQ Magazine Pro on 13th June 2022, powered by EnKing. In this webinar, Mr. Arun Victor, Senior General Manager, EnKing International talked about achieving net zero.
Mr. Arun Victor put his views on carbon offsetting and net zero in the webinar. He said, “Corporates are really aspiring to become net-zero companies in the long term because the climate change issue has become a very important issue globally by the countries and the organizations. We felt that this topic would be apt for industries, companies and organizations on how actually to get to this journey of becoming net-zero. We all are aware that we are facing a very key issue of climate change. Climate is changing drastically in our day to day lives and this climate change is happening because of a very important phenomena called the greenhouse effect which is a very key for life to exist on Earth. If it happens naturally then it is good for all of us but because of human induced activities the greenhouse effect is being enhanced which is creating the problem.”
Talking about greenhouse gases, he said, “Atmosphere has certain gases and these gases are called greenhouse gases which are able to retain the heat or absorb some amount of the heat and maintain that warmth required for life to sustain on the earth. It is called the greenhouse effect. Some of the energy we are getting from the sun is getting trapped by our earth’s atmosphere and this is happening because of the presence of greenhouse gases. We all are aware that carbon dioxide is one of the important greenhouse gases and water vapour is another greenhouse gas. A simple analogy to understand, when you park your car under the sun and you go inside the car, you will feel that there is more heat.
The natural greenhouse effect is good and it’s very much essential for life to exist on the Earth. The human race enhanced this effect by burning fossil fuels extensively which took millions and millions of years to form. We are releasing the carbon which is locked in the form of the fossil fuels into the atmosphere, resulting in enhancing the greenhouse effect. Besides carbon dioxide, there are 7 to 8 gases like methane, nitrous oxide which are listed as greenhouse gases which we are emitting into the atmosphere because of human activities. We all use fossil fuel in our industries for our energy requirements, for powering up our industries. Methane is getting emitted from our agricultural activities, so agriculture and land use changes are main sources of methane emissions. Also, from our landfills and waste decomposition, methane is getting emitted. The problem is the concentrations of these greenhouse gases are increasing in the atmosphere.
The average global temperature has almost increased by 1⁰C and this is very alarming. There are many impacts that have happened because of the warming up, the Arctic ice has drastically gone down from 1984 to 2012 which is increasing sea level. We are facing strong hurricanes, forest fires, changes in the precipitation patterns, heat waves and many more. If we want to find a solution for this problem then either we should work on increasing the carbon sinks or we have to cut down the carbon emissions. Today our emissions are ~52 billion metric tonnes of carbon dioxide equivalent to greenhouse gases. In the recent report released by the IPCC, it is indicated that we are in the phase of ‘code red’ for humanity.
If we have to avoid our limit to global warming we have to cut our emissions massively. Climate change is a global issue and the countries cannot handle this issue on their own without the participation of the private sector. The year 2021 was very important because many of the countries and corporations joined the race to cut down the carbon emissions and they all have set a target to achieve net-zero in the long term. There is a lot of pressure on all of us to decarbonize our operations. In the Glasgow conference, India pledged to achieve net-zero by 2070. Carbon neutrality and net-zero are the new gold. “
Furthermore, talking about how a company can achieve carbon neutrality, he said, “First step for any company is just to know how much greenhouse gases they are emitting. Then, establish a baseline with reference on how to reduce their carbon emissions in the future years. Once the baseline is set for carbon emissions, the company should set targets on how to reduce the carbon emission based on these targets. The company should take up concrete action plans so in the near term what are the steps we will take to cut the carbon emissions. Without offsetting the carbon emissions, it is nearly impossible to reach net zero. Therefore offsetting is really a viable approach for any company to become carbon neutral. After taking all the steps there will be some carbon left which is called residual emissions and are not technically and economically feasible. These emissions have to be offset through some other means and there are techniques to do so.”
Mr Victor further told about market based instruments (MBIs) which help in neutralizing residual and hard to abate emissions. He said, “There are several varieties of market based instruments, one one of them is the carbon offset and second is I-RECs. Carbon offset represents environmental attributes associated with 01 tonne carbon dioxide emission reduction and removal in GHG emissions. It is used for commitments like Carbon Neutrality or Net Zero emissions. It can also be used to reduce emissions across all 3 scope of carbon footprint. On the other hand I-RECs represent environmental attributes associated with 1 MWh of renewable energy generation. It is used for commitments like RE100 and can be used only for Scope 2 emissions reduction.”
Talking about the difference between ‘carbon neutrality’ and ‘net zero’, he said, “Carbon neutrality and net zero emissions, both look the same but in fact there are differences between these 2 terminologies. Carbon neutral means any company which is balancing their emissions carbon emissions by offsetting those emissions through avoidance and the purchase of carbon credits and then they make a balance how much they emit how much they avoid or remove. While net zero completely focuses on the cutting of the carbon emissions as soon as possible. Carbon offset is balanced out of the total amount of carbon offset. It allows companies to offset residual CO2 emissions from their operations.
Net Zero is a newer concept, defined by the Science Based Targets initiative (SBTI), Net Zero means reducing CO2 emissions as much as possible. For any residual emissions, an equivalent amount must be removed from the atmosphere by investing in carbon removal projects, for e.g., afforestation or carbon capture and storage. In carbon neutrality, projects may not be much more expensive than simply buying carbon credits. It is good to achieve in the near term and in the interim. While projects are generally much more expensive than simply buying carbon credits and are more difficult to achieve because it involves the permanent removal of residual emissions.”
To reach net zero Mr Victor talked about a few approaches. He said, “Things which will help in approaching net zero are reducing the energy consumption and associated emissions, replacing the energy with renewables, using or investing in carbon offsets, deploying negative emission technologies, practicing circular economy, practicing life cycle thinking, using carbon pricing and participating in programs & disclosures.”
For developing carbon credits a company could look for renewable energy projects like solar, wind, hydro, biomass, geothermal, solar water heaters or biogas plants. These projects can be registered under voluntary market mechanisms and carbon credits can be issued. Similarly, energy efficiency by improving the efficiency of energy use. These are the types of projects which can be eligible for the issuing carbon credits. Then there are nature based solutions such as forestry, agriculture and blue carbon.”
Furthermore, he talked about standards for issuing carbon credits. He said, “CDM (Clean Development Mechanism) is one of the oldest mechanisms driven by UNFCCC, United Nations, and is a compliance program. Next is, CDM POA (Programmes of Activities) driven by UNFCCC, United Nations, is also a compliance program. Next is VCS (Verified Carbon Standard) driven by VCS Board, USA which is a voluntary program. Next is GS CER/VER Gold Standard driven by GS Board, Switzerland which is a voluntary program. Next is GCC (Global Carbon Council)driven by GORD, Qatar which is also a voluntary program.”
Talking about the carbon offsets projects, he said, “There are two types of projects, first is community based and second is absorption or removal based projects. Community based projects include efficient cook stoves, access to safe drinking water, household biogas and EE, etc. Whereas absorption or removal based projects include nature based solutions, soil carbon, CCS, etc. These are the variety of carbon offsets projects but now these are not very highly commercially scalable. In the future it is also looked on to be a very promising area where these projects will start generating carbon offsets. Nature based solutions are actions to protect, sustainably manage and restore our natural and modified ecosystems that address societal challenges effectively and adaptively, simultaneously providing human well-being and biodiversity benefits.”
Mr Victor told about the climate roadmap which every business should follow and EKI is there to help in offsetting carbon. He said, “EKI has the expertise in identifying appropriate partners in various regions for such activities and then entire scoping of how much carbon can be avoided or removed is done through surveys, selecting the appropriate methodology, doing the baseline study and community engagement and then developing the project design document. EKI has the expertise to deliver the project for carbon offsets through monitoring and documentation using 3rd party implementation, till the issuance of the credits. EKI also has expertise in developing nature based solutions for carbon offsets. Nowadays, all the businesses also include climate as a part of the strategy and establishing the management framework on how these things are monitored or implemented, who are the people driving this initiative, who are responsible, what are the rules and what are the systems in place to monitor the gases.
Management framework is the key. Organizations have to identify what are the risks they are going to face in the near term and long term because of the climate change issue, how climate is going to affect the businesses. After implementing all these things a business should have a greenhouse gas inventory to have an estimate of the amount of greenhouse gases emissions. Now comes the baseline and setting targets for the next years and the consecutive years. Short term targets could be for the next one to 3 years and medium term targets can be the next 3 to 5 years and long term targets can be above 5 years. Carbon pricing is another tool used by many corporations worldwide, so having a price for carbon internally for your company is also going to help to come out with implementation plans. Supply chain engagement is key because a lot of emissions is not only limited to one organization but many things come out from one supply chain. Implementation plays a key role. There are multiple ways you can disclose your climate performance through platforms like CDP which is one of the oldest and very popular platforms to which corporations disclose their climate performance. It also helps to strengthen their activity on climate. When an organization discloses its climate performance, it is showcasing its commitment and performance towards the climate to the organization’s stakeholders, investors, communities, employees and the regulatory bodies. Also, an organization could go ahead with some global commitments to showcase leadership.”
Talking about the services which are offered by EKI, he said, “We are the only publicly listed company in the domain of climate change and carbon credit supply and development in India. We have been trading well and have traded more than 170,000,000 offsets last year. We are in this field for more than 13 years, servicing companies not only within India but also across the globe. Our team is growing aggressively. We have a client base of more than 2500 in more than 40 countries. We have offices in more than 14 countries outside India. We are also recognized as a promising brand and are accredited service providers of CDP. We are also committed to Climate Neutral Now as an organization. We have a target to achieve net zero by 2030 and are reporting our carbon emissions and then making ourselves climate neutral every year.”
More services that are offered by EKI are carbon credit and climate services, ESG services and green certifications & environmental sustainability advisory. Carbon credit and climate services are development and supply of carbon offsets, nature based solutions, greenhouse gas emissions inventory, scope 3 services, science based target setting, support to CDP reporting, 3rd party verification of GHG statements as per AA1000AS standards and carbon pricing. ESG services are materiality assessment, sustainability strategy/design of ESG framework, sustainability and ESG reporting as per global standards and 3rd party assurance of sustainability report as per AA1000AS standards. Services which are provided under green certifications & environmental sustainability advisory are green supply chain audits, implementation of sustainable and green supply chain program, consultancy for green company rating, consultancy for green building certifications – LEED/IGBC, consultancy for net zero energy, water and waste certifications by IGBC and water footprint & neutrality services.
