Carbon Reduction Fundamentals

05/19/2010 | By Eric Woodroof, Ph.D., CEM, CRM

Strategies for carbon reduction may seem complex to facility managers, but the fundamentals can be summarized by ERMO – Eliminate, Reduce, Mitigate, and Offset.

Carbon Reduction Fundamentals Carbon Reduction Fundamentals

Strategies for carbon reduction may seem complex to facility managers, but the fundamentals can be summarized by ERMO – Eliminate, Reduce, Mitigate, and Offset. Let’s discuss each of the four elements.

1. Eliminate Processes
As Yoda said, “We must unlearn what we have learned.” Many green solutions involve undoing a solution to a problem that no longer exists. I have observed many successful companies that cut carbon by thinking differently.

For example, a fax machine was a brilliant document-delivery solution in the 1980s. Today, the Web is a much better solution. Although the fax machine is obsolete, many of us still have one (or three) and we pay for their electricity, toner, paper, and replacement costs (not to mention the phone line service costs). Eliminating the fax machine saves all those costs and the associated carbon footprints.

You can take this same approach to business processes. Keep asking, “Do we really need this process?” If the process yields only small benefits, consider eliminating it to simplify your business and save emissions.

2. Reduce/Reuse/Recycle
After eliminating unneeded processes, the next step is to implement the three “Rs.” Applying the reduce principle to energy consumption is one of the most cost-effective ways to cut emissions. There are thousands of highly profitable ways to reduce energy consumption by leveraging new technologies in lighting, HVAC, and other building systems. In addition, maintenance savings or behavior modification savings (getting employees/tenants to use less energy) can be equally as valuable, delivering savings of 15 to 30 percent with a nearly immediate payback.

An example from a client: One of the largest cell phone providers in the United States redesigned their shipping boxes for small mobile phones. The new boxes used a different type of cardboard that was thinner yet stronger. By making the walls of the boxes thinner, the firm reduced the amount of cardboard per box, which cut its consumption of cardboard. (Remember that reducing or recycling decreases upstream emissions, reducing your firm’s footprint.) The new boxes also took less energy to transport and more of them fit within a given shipment from the factory to the distribution center.

Employees were inspired by the project and went on to suggest even more resource conservation ideas. In one instance, they asked management to provide employees with bottled water in 5-gallon bottles located in central locations rather than continue to offer the water in individual bottles. The resulting reduction in plastic waste further reduced the firm’s upstream emissions impact.

3. Mitigate
After reducing your consumption of energy and resources, the next step is to mitigate the source of the energy that you use. If you are using fossil-based fuels, you can begin moving toward energy from cleaner sources. In many regions, you can buy green power from your utility. Alternatively, you can install your own renewable power sources, such as solar and wind. However, in most buildings, it is unlikely that you will be able to generate enough energy to meet your consumption requirements.

You can get solar power on your roof at no upfront cost via a Power Purchase Agreement (PPA). With a PPA, the installation costs are financed by the energy savings (i.e., diminished energy purchases from the utility). Many firms have utilized this method to avoid upfront costs while capturing the green benefits of solar (employee morale, company image, positive cash flow, and reduced risk from price spikes).

4. Offset
If it is impractical to mitigate your fossil fuel consumption or to buy green power from your utility, then you can buy an “offset,” which means that you contribute to the cost of someone else’s mitigation efforts and you receive a credit for your portion of the investment. Although this is a relatively new market, you can buy credible offsets on the Internet and eliminate your carbon footprint. Compared to direct mitigation efforts (e.g., installing solar on your own roof), offsets are relatively inexpensive, but the downside is that you have to buy offsets each year to counterbalance your footprint. In addition, you are dependent on someone else’s actions/credibility to be sure that the offset projects actually occur.

In the United States, there are two primary offset products. One is a carbon credit, which equals 1 metric ton of carbon dioxide avoided/absorbed (as from a forestry or methane re-capture project). The second product sold is a Renewable Energy Credit (REC), which represents one MWh produced from renewable energy (such as a wind or solar farm). Be sure to buy an offset credit from a reputable brand!

Due to increased competitive forces, offsets can be less expensive than buying green power from your local utility. For example, in Texas I can pay an additional 3 cents per kWh to buy green power, or I can buy a wind REC for about .7 cents per kWh. As a result, I can get the same carbon result and save 2.3 cents per kWh.

One more thing on RECs: They have different amounts of carbon savings for each geographic region in the United States, so you could save even more. For example, an REC from California will be worth about 868 pounds of carbon dioxide, while an REC from Michigan is worth about twice as much carbon! If they are selling at the same price, you can get much more offset for your dollar if you know where to look! I call this approach “REC speculation,” and it has great savings potential for U.S. facility managers.

Reduction strategies coupled with proper greenhouse gas accounting (which was discussed in last month’s article) can be a powerful combination and yield many benefits for your organization. And knowing just a few principles can save your organization a lot of money! You can download a free spreadsheet to get a rough estimate of your carbon emissions at

Eric Woodroof, Ph.D., is the Chairman of the Board for the Certified Carbon Reduction Manager (CRM) program and a board member since 1999 of the Certified Energy Manager (CEM) Program. He is a strategic advisor, corporate trainer, keynote speaker, and founder of

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