New report details the importance of accurate, actionable data in creating resilient, low-carbon supply-chains and goods

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Rocky Mountain Institute’s (RMI’s) latest report explores what it will take to learn the carbon content of the goods we use each day.

As companies attempt to decarbonize their operations to meet climate goals, they often find that ‘greening’ their supply chains is more complicated than it seems.

Rocky Mountain Institute today released a new report, The Next Frontier of Carbon Accounting: A Unified Approach for Unlocking Systemic Change, focused on the critical need for a universal framework that shows the greenhouse gas emissions embedded in the materials and goods we use each day.

Without insight into the climate impact of our everyday products, it is impossible for consumers to demand lower-carbon goods, and impossible to decarbonize the industrial sectors that are responsible for 40 percent of annual greenhouse gas emissions. This new report provides a pathway to a unified approach for carbon accounting that will create systemic change in how emissions are reported and acted on.

“As companies attempt to decarbonize their operations to meet climate goals, they often find that ‘greening’ their supply chains is more complicated than it seems,” said Paolo Natali, principal at RMI. “One of the central challenges is getting accurate, actionable data on emissions. Currently, there is no universally accepted way to know the emissions intensity of products or the materials that went into building them, making it a challenge to compare greenhouse gas emissions across companies and supply chains.”

RMI’s analysis shows how accurate assessments of greenhouse gas (GHG) emissions along the supply chain (Scope 3 emissions) would greatly help advance new, cleaner technologies and greener products by providing a way for makers of “green steel” and other decarbonized products to charge a premium for their environmental attributes. Additionally, with full visibility of climate attributes such as carbon footprint along supply chains, consumers could demand materials that are built with less CO2, and investors would be better able to fund technologies that align decarbonization pathways.

Key findings from the report include:

Corporations are experiencing increasing pressure from consumers, investors, and policymakers to disclose both their direct GHG and supply chain emissions.

There are currently three main challenges to reporting Scope 3 emissions:

  • Disclosure platforms for materials have white spaces, with no sector-specific framework to align accounting across various materials and end-uses.
  • Scope 3 boundaries are not well defined for individual industries.
  • Disclosure is voluntary and results are often unverified.

Guidance documents for some specific sectors have been developed, but no methods exist that cover entire supply chains of materials.

Myriad reporting platforms are causing reporting fatigue for companies, driving demand for more consistency and comparability of reported data.

Establishing a universal GHG disclosure framework requires a cross-sector effort based on a few key design principles:

  • Leverage and build on existing efforts—do not “pile on” with yet another method.
  • Ensure that the needs of critical use cases are served.
  • Align GHG and financial accounting to ensure reliability and address the problem of distorted regional incentives (similar to capital flowing toward tax havens).
  • Provide supply-chain-specific guidance.

Mining and mineral processing companies are well positioned to take a leading role in driving harmonization in GHG accounting given their position as the backbone of industry, straddling several supply chains.

Although methods like life-cycle analysis and environmental product declarations exist, there is currently no consistency in data collection or reporting across methods, and no framework that spans the entire supply chain. This is why RMI, together with MIT Sustainable Supply Chains, the Columbia Center on Sustainable Investment and the Payne Institute for Public Policy at the Colorado School of Mines are working together as part of the Coalition on Materials Emissions Transparency (COMET). This effort aims to build a standard framework for measuring GHG emissions in materials. Having a universal framework is an important step in driving the decarbonization of mineral and industrial supply chains and would be valuable for corporations and the public alike by providing insight into the carbon content of consumer products like cars, buildings, and phones. It will also help both corporations and consumers purchase materials and products with fewer CO2 emissions.

For more information, contact Paolo Natali (pnatali@rmi.org) or visit http://www.rmi.org/comet

Media Inquiries please contact:

Nick Steel, Media Relations Manager, New York,
Tel: +1 347-574-0887
Email: nsteel@rmi.org

About Rocky Mountain Institute

Rocky Mountain Institute (RMI)—an independent nonprofit founded in 1982—transforms global energy use to create a clean, prosperous, and secure low-carbon future. It engages businesses, communities, institutions, and entrepreneurs to accelerate the adoption of market-based solutions that cost-effectively shift from fossil fuels to efficiency and renewables. RMI has offices in Basalt and Boulder, Colorado; New York City; the San Francisco Bay Area; Washington, D.C.; and Beijing.

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