In June 2012 The UK’s Deputy Prime Minister, Nick Clegg announced a new mandatory carbon reporting requirement for all main board companies on the London Stock Exchange (list of 1,370 companies here). This follows a public consultation last year where the majority supported making GHG emissions reporting mandatory.
From 6 April 2013 all impacted companies will have to submit a carbon footprint report, and their carbon footprint information will have to be included in the Directors’ Report, alongside their audited financial statements.
Although DEFRA has started the consultation to finalise the exact details of this legislation, the core requirements have been made very clear and are largely consistent with other international reporting standards such as the Greenhouse Gas Protocol and ISO 14064-1.
- Companies will have to report on their emissions in all countries of operation, not just the UK. It is also expected that the emissions factors for activities at global locations will be required to use the regional/country or state specific emissions factors.
- Companies can define the extent or boundaries of their organisational carbon footprint in one of three ways:
- Operational control
- Financial control
- Equity control
- Companies will be required to include all Scope 1 direct emissions from their premises, plant, machinery, lands and vehicles. (Notably including vehicle fleet)
- Companies must also report emissions from purchased heat and electricity (Scope 2), and emissions from surface transportation (road, rail and water), even if provided by a third party (Scope 3 - Freight, and Business Travel).
- Other emissions covered by this new mandatory report include Waste (Multiple Streams).
- Companies will be required to report all six Kyoto gases carbon dioxide (CO2), methane (MH4), hydrofluorocarbons HFCs, nitrous oxide(N2O), perflurorocarbons(PFCs) and sulphur hexafluoride(SF6) (see section 92 of the Climate Change Act 2008) in terms of CO2 equivalent(CO2e).
- This notably includes refrigerants from air conditioning, chillers, and refrigerants both stationary and truck mounted. This means, for example, that natural gas will be reported in three components CO2, methane and nitrous oxide.