CO2 neutrality in companies: Capturing and reducing CO2 emissions

Promote CO2 neutrality in companies - learn more about the general levers in the TLK Energy Blog. Reduce CO2 emissions through decarbonization, energy efficiency and offsetting.

Franz Lanzerath

|

August 17, 2021

© nickolay / 123RF.com

How do companies become CO2 neutral?

The concept of carbon neutrality has gained momentum and relevance in recent years. As part of the Green Deal concluded in 2020, the EU's carbon neutrality targets call for becoming climate neutral by 2050. This policy framework has individual constraints - but also opportunities - for commercial enterprises.

Industry is under increasing pressure to reduce CO2 emissions. But it is not only the EU-wide climate targets that are challenging companies and entire sectors of the economy. Industry in particular is already required to account for and reduce its greenhouse gases by means of the EU Emissions Trading Scheme (EU ETS).

The pressure of public debate from various interest groups and the ever-increasing customer demands around sustainability and climate justice, is also driving companies and stakeholders to consider their corporate carbon neutrality.

Within the scope of these measures, there is a wide range of options for achieving CO2 neutrality. On the one hand - and first and foremost - these include the recording and analysis of greenhouse gas emissions as the starting point for a more far-reaching strategy. Secondly, they relate to direct means and processes in practice that companies can implement to become CO2 neutral.

At the same time, these aspects raise the question of how companies can check which measures are the most efficient as well as effective for them - especially in view of the economic approach with which companies evaluate their core processes.

The first step towards CO2 neutrality: Recording CO2 emissions

The basis of any CO2 neutrality measure involves recording the current status and quantifying the amount of CO2 emitted. For companies in particular, initial consideration of the concept of CO2 reduction is usually very vague, as it is not possible to estimate the impact on the climate and environment of their own production processes.

CO2 emissions are differentiated as follows:

  • scope 1 (direct emissions): refers to all emissions emitted directly by the company, e.g. from the company vehicle fleet or from heat generation through combustion processes.
  • scope 2 (indirect emissions from purchased energy): includes all externally purchased energy in the form of electricity, heating and cooling that cause greenhouse gas emissions.
  • scope 3 (indirect emissions from the value chain): are all other emissions that result from both upstream and downstream activities along a company's value chain. Scope 3 includes, for example, emissions from employee business travel and purchased materials and services.

Identify and allocate CO2 emission sources

Larger companies often face the challenge of determining exactly where the sources of their corporate carbon footprint come from. Particularly in complex production processes and supply chains, it is not always immediately apparent where CO2 emissions originate and in which areas the greatest levers for optimization can be found.

For better categorization, emissions can be assigned to individual sub-areas of a company. Energy-intensive production processes, buildings and transportation are often the biggest sources of emissions. In particular, the purchase of energy from carbon-containing and fossil energy sources causes large CO2 emissions. Furthermore, transport routes in commercial supply chains cannot be neglected in view of the globalization of economic and production processes. In any case, it should be clear that the emissions are distributed across different areas and therefore a holistic view of the different scopes is necessary when identifying and allocating them.

Calculating the corporate carbon footprint

The carbon footprint can be calculated not only for private households and individuals, but also on a larger scale for entire companies (corporate carbon footprint). Many companies rely on a verification process using international certifications. This enables them to record their CO2 emissions in a structured manner, and to better understand and reduce company-related environmental impacts in order to ultimately achieve CO2 neutrality.

International standards for calculating the carbon footprint are as follows:

  • ISO 14064: Standard for the calculation of the company-wide carbon footprint
  • PAS 2060: Standard for the Calculation of the Corporate Carbon Footprint

While ISO-14064 defines principles and specifications regarding reporting and monitoring, PAS 2060 defines a set of concrete requirements for demonstrating carbon neutrality for a company's products and services.

The ecocockpit of the Effizienz-Agentur NRW offers a very good introduction to the topic. SMEs in particular can easily record and analyze their CO2 emissions here.

General levers for CO2 neutrality for companies

After recording the ACTUAL state, it is relevant for companies to identify the most important levers and measures in practice. For us, three areas of action stand out as particularly concise for paving the way towards CO2 neutrality.

Decarbonization

Decarbonization - usually referring to industry as a whole - means turning one's back on carbon dioxide emissions and replacing fossil and carbon-rich fuels with renewable energy.

For companies, this means in practice sourcing their energy - be it electricity or heat - using renewable sources such as solar, wind, hydropower, and biomass and geothermal. Instead of relying on gas as an energy source for heating with a gas boiler, in this case the heat could be provided by means of a heat pump and photovoltaic system. By not using a high-carbon form of energy in this way, the company can reduce CO2 emissions and promote its carbon neutrality.

Energy and resource efficiency

The goal of energy and resource efficiency is to reduce energy demand in general, not to make the energy supply CO2 neutral as in the case of decarbonization. A major lever in energy and resource efficiency is heat recovery and heat integration.

Heat recovery describes the reuse of thermal energy within a process. In the case of a ventilation system, the heat contained in the exhaust air can be transferred to the cooler supply air with the aid of a heat exchanger and thus reused.

We speak of heat integration when heat recovery and utilization take place across different processes. By means of heat exchanger networks, process flows that are to be cooled can be linked with process flows that are to be heated, and synergies of measures for CO2 neutrality can be created. Mathematically, pinch analysis serves as a tool for systematically determining the maximum potential of heat integration and minimizing energy consumption in technical processes.

Another way to increase resource efficiency is to consider the production and energy systems in tandem. Usually, these two systems are considered separately without taking possible synergies into account. In a research project with RWTH Aachen University, we have investigated how degrees of freedom can be exploited in a joint approach to reduce energy consumption.

CO2 compensation

A completely climate-neutral balance is virtually impossible for a company, even if it increases its energy and resource efficiency and has no direct emissions. The impact on emissions along the value chain (scope 3) is often small and CO2-neutral upstream products and services are rarely available.

On the way towards CO2 neutrality, remaining CO2 emissions can therefore be compensated, thus reducing the carbon footprint in the balance to zero.

The simplest form of CO2 compensation is the purchase of CO2 certificates, provided the company is not subject to mandatory EU emissions trading. CO2 certificates can be purchased through various service providers, such as atmosfair.

By purchasing the CO2 certificates, the company invests in certified climate protection projects that would not be profitable without funding and would otherwise not take place. Measures include efficient stoves, biogas plants and the use of renewable energies. Since investments are usually made in international climate protection projects, emissions are avoided where it is most economically viable.

To ensure the effectiveness of the measures, attention should be paid to appropriate standards. The most widely used are the "Verified Carbon Standard" and the "Gold Standard", which guarantee that investments are actually made in climate-protecting projects and that CO2 certificates are not sold more than once. In this case, CO2 certificates are a good complement to the CO2-neutral company.

With system simulation to CO2 neutrality in companies

Nevertheless, the first focus should be on the avoidance and reduction of CO2 emissions in the company. When evaluating the actual state of a company and technical measures regarding CO2 neutrality, system simulation can achieve serious advantages. By holistic consideration of decarbonization and efficiency measures, these can be put into relation and evaluated. The simulation of different variants can reveal optimization potentials of individual plants and synergies arising from the linking of processes. By calculating various scenarios, it is also possible to plan your company's path to CO2 neutrality in a robust and future-proof manner.

Got you hooked?

Follow us to stay in touch:

Dr.-Ing.

Franz Lanzerath

Managing Director

TLK Energy

Dr.-Ing. Franz Lanzerath received his doctorate at the Institute of Technical Thermodynamics at RWTH Aachen University. Since 2007 he has been intensively engaged in the model-based development of thermal systems. One of his main interests is the interface between model and experiment, i.e. model calibration and validation. At TLK Energy he is responsible for the transfer of the latest scientific methods and findings into industrial practice.

Keep on reading: