Carbon Accounting Is an Essential Tool in Decarbonization Planning

You can’t manage what you don’t track, which is why greenhouse gas (GHG) accounting, also known as carbon accounting, is an important tool in decarbonization planning. Without knowing your carbon footprint, it’s difficult to know where best to invest in sustainability.

Standards and reporting programs such as the GHG Protocol and ISO 14064 are frameworks for measuring and tracking an organization’s GHG emissions, accounting for both direct and indirect emissions. Direct emissions are those from sources that are owned or controlled by the reporting company; indirect emissions are those that are a consequence of the reporting company but that occur at sources owned or controlled by another entity. Emissions are typically further divided into scope 1, 2 and 3.

Scope 1 emissions are the direct emissions from a site. These are broken down into four subcategories: stationary combustion, mobile combustion, fugitive emissions and process emissions. Scope 2 emissions are indirect emissions from the purchase of energy (e.g., electricity, steam, heat). Scope 3 emissions are all other indirect emissions and are divided into 15 subcategories:

• Purchased goods and services
• Capital goods
• Fuel- and energy-related activities
• Upstream transportation and distribution
• Waste generated in operations
• Business travel
• Employee commuting
• Upstream leased assets
• Downstream transportation and distribution
• Processing of sold products
• Use of sold products
• End-of-life treatment of sold products
• Downstream leased assets
• Franchises
• Investments

After an organization identifies its emissions, it can better plan where and how to reduce them. Organizations have many ways to achieve their goals — they can bolster energy efficiency, pursue on-site or off-site renewable energy, or change who they work with upstream and downstream, for example. All of these can decrease emissions. Purchasing renewable energy certificates (RECs) and carbon offsets represents another option.

Investing in energy efficiency is a vital first step, as it can reduce electricity or gas consumption and thereby lower scope 1 or 2 emissions and save on energy expenses. Many energy efficiency measures can be low- or no-cost, too — for example, turning off lights at the end of the day in an office building if they’re usually left on 24/7. Other energy efficiency measures may require capital investment.

Fuel switching can be an additional way to reduce a site’s carbon footprint and involves switching from a higher-emissions energy source to a lower-emissions one — such as through electrification. However, while it might be great in theory to eliminate all fossil fuel-burning equipment, it can be difficult to achieve, especially if a site needs steam or hot water as part of its process. This is where heat pumps can be critical as a key opportunity for electrification.

Heat pumps are well known in the residential space, but they have many applications. Examples include packaged and split-system units that start at 1 ton (some specialty rooftop options reach over 50 tons), cold-climate heat pumps (which can provide heat down to below-freezing temperatures without using supplemental heat), water-source heat pumps, heat pump water heaters, industrial heat pumps (which include heat recovery/heat pump chillers), and even heat pump dryers for laundry.

Heat pumps frequently reduce scope 1 emissions, improve site air quality by avoiding combustion, have lower operating costs and are more energy efficient, with a typical coefficient of performance (COP) of 2.5 to 7 depending on the application. A standard boiler has a COP of 0.8, and a direct-fired heating coil can have a COP of 0.9. (COP is a unitless value of the ratio of heat output to work input. A COP of 1 would mean every 1 kilowatt-hour [kWh] of electricity in would result in 1 kWh of heat. The higher the value, the more efficient the system.)

Despite their advantages, though, heat pumps have features that require consideration. For example, they need to be operated and maintained differently than traditional gas-fired equipment (proper education and training may be necessary for maintenance personnel), lower-temperature air out of the units can be reported as “drafty,” heat recovery chillers have lower heating hot water temperatures than typical boiler systems, they have higher upfront costs, they increase scope 2 emissions, and they can potentially increase a site’s overall carbon footprint depending on location, though this is unlikely in most areas (see calculation below).

The following is an example calculation of the emissions associated with a heat pump vs. a gas furnace. Assuming 1 million British thermal units (MMBTU) of heat is required to heat a space:

• For the gas furnace, we will assume a COP of 0.9, or that it is 90% efficient. This means that 1 MMBTU of heating will require 1.1 MMBTU of natural gas. From the U.S. Environmental Protection Agency (EPA), there are 53.12 kilograms (kg) of carbon dioxide equivalent (CO2e) per MMBTU of natural gas consumed. So, for 1 MMBTU of heating, we produce approximately 59 kg of CO2e.

• For the heat pump, we will assume a COP on the low end of 2.5. This means to get 1 MMBTU of heat, we need 0.4 MMBTU of electricity, or 0.117 megawatt-hours (MWh). From the EPA, the U.S. national grid in 2022 averaged 827.52 lbs CO2e per MWh, or 375.4 kg of CO2e per MWh. So, for the same 1 MMBTU of heating, a heat pump would result in approximately 44 kg of CO2e.

Want to learn more about carbon accounting or how best to reduce emissions are your site? We can help.