Climate Change appears to be a top concern for humanity at the moment. This is due to the rise in greenhouse gases (GHG) in the atmosphere, which is mainly due to human activities like burning fossil fuels, deforestation, and industrial processes. Gases such as carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O), trap heat in the atmosphere, leading to global warming.
Terms like “carbon-neutral” and “net zero” are often used when we talk about reducing emissions. While both these terms involve balancing emitted GHGs with avoided or removed emissions, the key difference lies in the compensated emissions, that is offsets.
What is Carbon-Neutral?
The concept of carbon neutrality revolves around balancing out the CO2 emissions we emit in the atmosphere, either by reducing them or offsetting them with an equal amount of reduced emissions. The aim here is to achieve a net-zero carbon footprint. There are various strategies to achieve this, including investing in renewable energy, enhancing energy efficiency, and buying carbon offsets.
These strategies have helped Google to make significant progress in global renewable energy projects. They have signed power purchase agreements (PPAs) with wind and solar farms to secure a steady source of clean energy. They have also invested in carbon offset programs such as methane capture from landfills and improved forest management.
Carbon Neutrality is achieved when the net amount of carbon dioxide emissions produced by an entity (such as a company, organization, or individual) is balanced by an equivalent number of emissions removed or offset. This implies that with every ton of CO2 produced, an equal amount is either reduced or offset, resulting in a carbon footprint of zero.
Achieving carbon neutrality is a two-part plan: cutting down on emissions as much as possible and offsetting any remaining emissions through various methods. The goal is to ensure that entities do not add any additional emissions to atmospheric CO2 levels.
Origin
Carbon neutrality came into the picture as a part of a larger environmental movement in the early 2000s. It arose when businesses and governments recognized the importance of addressing their carbon emissions and reducing their effects on climate change.
Emission Balancing
Equalizing emissions is a process that involves measuring the overall carbon emissions generated and then taking steps to balance out these emissions through equivalent reductions or offsets. This is possible through various methods like investing in renewable energy projects, enhancing energy efficiency, and purchasing carbon credits.
What is Net Zero?
Net Zero raises the bar by aiming to reduce all man-made greenhouse gas emissions in every industry. It helps reduce emissions as much as possible and balance any remaining emissions with removal or offset measures. The focus is to reduce significantly before considering offsets. Key strategies to achieve net zero include transitioning to renewable energy, enhancing energy efficiency, carbon capture and storage (CCS), reforestation, and innovating new technologies.
It was introduced in the Science-Based Target Initiative’s Corporate Net-Zero Standard.
Apple is working on making products using only recycled or renewable materials, using a closed-loop supply chain. Their solar and wind farms globally contribute to their goal of achieving 100% renewable energy across their supply chain.
Net zero involves striking a harmony between the greenhouse gas emissions generated and those removed from the atmosphere. The aim is to reduce emissions as much as possible, and then compensate for the remaining emissions using methods like carbon capture and storage or natural processes such as reforestation. It aims to eliminate all human-caused greenhouse gas emissions. This involves reducing emissions across all sectors, including energy, transportation, industry, and agriculture, until the remaining emissions can be offset.
A key principle of net zero involves reducing significant emissions before opting for offsets. This ensures that the efforts prioritize actual carbon emission reduction through significant practices and technologies, rather than just compensating for high emissions with offsets. The option of offsets should only be used when it’s difficult to eliminate the emissions entirely.
Origin
The idea of net zero is rooted in scientific research and climate policy, especially aimed at reducing global warming. It became widely recognized after the Paris Agreement was adopted in 2015.
Alignment with Global Standards
The concepts of Carbon Neutrality and Net Zero work in accordance with global standards such as the Greenhouse Gas (GHG) Protocol, which provides a detailed framework for measuring and managing GHG emissions. It is a globally adopted accounting tool for understanding, quantifying, and managing GHG emissions.
Both carbon neutrality and net zero also work in favor of the goals of the Paris Agreement. This agreement aims to limit global warming to well below 2°C above pre-industrial levels, with efforts to limit the increase to 1.5°C.
Achieving Carbon Neutrality
Renewable Energy
Companies can minimize their carbon emissions by shifting from fossil fuels to renewable energy sources such as solar, wind, hydro, and geothermal power, contributing to a greener energy grid. To ensure that the power used is sourced from renewable projects, companies also enter into power purchase agreements (PPAs).
Energy Efficiency
Companies can enhance energy efficiency by installing LED lighting, energy-efficient HVAC systems, and smart meters to monitor and manage energy use. Optimizing heating and cooling schedules, improving insulation, and using energy-efficient appliances can help reduce costs.
Carbon Offsets
Companies can purchase carbon credits from projects that reduce or seize emissions elsewhere. These projects can include reforestation, methane capture, renewable energy installations, and more. Each credit represents the reduction of one ton of CO2.
Sustainable Practices
Circular economy practices like reducing waste, recycling materials, and designing products that are durable and can be reused, can help achieve carbon neutrality. Collaboration with suppliers to implement sustainable practices across the entire value chain is crucial.
Carbon Neutrality Examples
Google completed our first carbon removal credit offtake deals through Frontier in 2023, including deals with Charm Industrial, CarbonCapture, and Lithos Carbon. They have maintained seven consecutive years of 100% renewable energy matching on a global and annual basis.
Google’s data centers are 1.8 times more energy-efficient than typical data centers. They have achieved a fleet-wide Power Usage Effectiveness (PUE) of 1.12 or lower since 2012.
Microsoft
In 2021, Microsoft made the world’s largest purchase of carbon removal, totaling 1.4 million metric tons, and aims to exceed this by procuring 1.5 million metric tons in the next fiscal year. They are also committed to eliminating its dependency on diesel fuel for backup power in data centers by 2030.
Microsoft is on track to power its data centers with 100% renewable energy by 2025.
Achieving Net Zero
Carbon Capture, Utilization, and Storage (CCUS)
Carbon Capture can be implemented in ways such as chemical absorption, adsorption, and membrane separation. The captured CO2 can be utilized in different industrial processes such as enhancing oil recovery and producing synthetic fuels. To avoid captured CO2 from going back to the atmosphere, it is important to have long-term storage solutions like geological sequestration.
Electrification of Transportation
As of 2020, the global electric vehicle industry is experiencing rapid growth, boasting over 10 million electric cars on the streets. To support the global adoption of EV vehicles, it is important to set up charging stations.
Nature-Based Solutions
Planting trees on degraded land can seize huge amounts of CO2. For example, the Bonn Challenge aims to restore 350 million hectares by 2030, potentially sequestering up to 1.7 gigatonnes of CO2 annually.
Digital Innovations
IoT and AI can optimize industrial processes, monitor emissions in real time, and improve energy management. Smart grid technology boosts the efficiency and reliability of electricity distribution, allowing for greater integration of renewable energy.
What is the Difference Between Carbon-Neutral and Net Zero?
| Aspect | Carbon Neutral | Net Zero |
| Conceptual Differences | Balancing | Eliminating |
| Emission Approach | Focus on compensating for emissions through offsets after they are produced. | Focus on eliminating emissions with minimal reliance on offsets. |
| Practical Differences | Temporary Solutions | Long-term Transformation |
| Duration of Impact | Often relies on short-term solutions, like annual carbon offset purchases, which need to be renewed regularly. | Aims for permanent solutions that transform operations to be inherently low or zero emissions, requiring fewer offsets over time. |
| Implementation Strategies | Common methods include investing in renewable energy certificates, reforestation projects, and purchasing carbon credits. | Requires detailed changes such as adopting renewable energy, enhancing energy efficiency, implementing carbon capture technologies, and overhauling industrial processes. |
| Policy Implications | ||
| Regulatory Focus | Often led by voluntary commitments or corporate social responsibility initiatives, with some regulatory incentives. | Increasingly becoming a regulatory requirement in many jurisdictions, with stringent targets and penalties for non-compliance. |
| Reporting Standards | May involve self-reported data with less rigorous verification in some cases. | Generally requires detailed reporting and third-party verification to ensure transparency and accountability. |
| Comparative Summary | Main Points of Divergence | |
| Primary Goal | Offset existing emissions to achieve a neutral balance. | Achieve zero emissions through significant reductions and only offset residual emissions. |
| Long-term Viability | Provides a pathway to mitigate climate impact but can be seen as a stopgap measure. | Represents a more sustainable and comprehensive approach to addressing climate change. |
Examples of Companies Achieving Carbon Neutrality
Apple
Apple is a prominent technology company committed to environmental sustainability. The goal is to reach carbon neutrality across their supply chain and product life cycle by 2030.
Reduction and Offsetting Strategies
Apple runs all its global operations with 100% renewable energy. In 2022, Apple achieved over 13.7 gigawatts of renewable electricity across its global supply chain. Through its Supplier Clean Energy Program, Apple got over 250 suppliers to transition to renewable energy, preventing over 17.4 million metric tons of carbon emissions annually.
Apple’s product design has time and again proved to be energy-efficient, using recycled materials. The use of 100% recycled aluminum in MacBook Air enclosures reduces emissions by nearly 50% compared to earlier practices. They have reduced their carbon footprint by 45% as compared to 2015 while growing their revenue by over 68%.
IKEA
IKEA aims to be climate-positive by 2030, focusing on reducing more greenhouse gas emissions than its value chain emits.
Reduction and Offsetting Strategies
IKEA has increased the use of renewable energy in its practices, with 25 markets using 100% renewable electricity in 2023. They are also working toward reducing their greenhouse gas emissions by half by 2030, compared to 2016 levels, and have introduced bio-based glue in board materials.
They are constantly innovating with their product designs like tableware using internal factory waste and improved energy efficiency in its lighting range. In FY23, IKEA reduced its total greenhouse gas emissions by 12% compared to FY22 and by 22% compared to FY16.
Patagonia
Patagonia is committed to being carbon neutral by 2025 through comprehensive strategies addressing its entire value chain.
Reduction and Offsetting Strategies
Patagonia invests in regenerative organic farming practices, which help trap carbon in the soil and reduce emissions from agriculture. They also encourage agricultural practices like cover crops, intercropping, crop rotation, etc.
It sources 100% renewable electricity for its operations and supports renewable energy projects in its supply chain. It also focuses on the durability and repairability of its products to extend their lifecycle, reducing the need for new production and lowering the overall carbon footprint.
Conclusion
To effectively add to global climate goals, businesses must make use of advanced technologies and innovative industrial operations. This detailed approach not only aligns with global standards like the Greenhouse Gas Protocol but also determines the pivotal role of corporate responsibility in leading significant environmental change.
At Carbon Trail, we aid fashion brands in their journey towards carbon neutrality by streamlining the product lifecycle assessment (LCA) process for fashion products, adhering to the upcoming Product Environmental Footprint Category Rules (PEFCR) for Apparel & Footwear and the ISO 14067 standard. Through this structured and comprehensive LCA, brands can recognize and tackle high-impact areas, and help them make quick decisions to reduce their carbon footprints.
By prioritizing high-impact, easy-to-implement initiatives, and using scenario modeling to estimate and prioritize decarbonization efforts, companies can strategically enhance their contributions to a sustainable future.
