Greenhouse gases, such as carbon dioxide, methane, nitrous oxide and other synthetic chemicals, trap some of the planet’s outgoing energy, retaining heat in the atmosphere. This process is known as the greenhouse effect, and it prevents some of the heat from returning directly into space, increasing Earth’s temperature. This is known as global warming, and today, the world is warming faster than it has at any point in recorded history [ref]. According to a landmark assessment from the Intergovernmental Panel for Climate Change 2021, the planet is warmer than it’s been in 125,000 years.
Human activity, primarily fossil fuel combustion and electricity production, has raised the amount of carbon dioxide and related greenhouse gases in our atmosphere leading to changes in our climate that result in rising sea levels, increased droughts, and extreme weather, which can disrupt food supply [ref].
Carbon emissions directly contribute to global warming and climate change, and governments, individuals, businesses, and industry need to work together to make the relevant changes to reduce greenhouse gas emissions, in particular carbon emissions.
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The Impact of Carbon
Carbon is the 4th most abundant element. But when does carbon become a problem, and how does the carbon intensity score assist us in tracking the issue?
Carbon is a problem when it combines with oxygen to form carbon dioxide, an odourless and colourless gas. It is also a greenhouse gas, meaning it traps heat in the Earth’s atmosphere. One way in which carbon dioxide enters the atmosphere is via the burning of fossil fuels such as coal, oil and natural gas.
Climate.gov has stated that the annual rate of increase of carbon dioxide in the atmosphere over the past 60 years is estimated to be around 100 times faster than previous natural increases that occurred at the end of the last ice age.
The term “carbon emission” is relatively well-known and understood; however, not many people have a full understanding of what carbon intensity is and how this could help us reduce our carbon emissions and reduce our carbon footprint.
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What is the difference between carbon emissions and carbon intensity?
A person’s carbon footprint refers to the amount of carbon emissions that they cause, indirectly or directly, through human activities. But each different action has a different carbon cost, and this is helpful when considering the amount of emissions per action – this is known as carbon intensity.
The difference between carbon emissions or a carbon footprint and carbon intensity is the difference between the gasoline we use every week versus the fuel efficiency of our vehicle.
The carbon intensity of electric energy relates to how much carbon dioxide is emitted into our atmosphere to produce an amount of electricity or electrical energy. This measurement can change over time based on the source of electricity. It can also come in two forms: total carbon intensity and marginal carbon intensity.
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Explaining Carbon Intensity
Carbon intensity is defined as carbon dioxide emissions per unit of energy – by the US Energy Information Administration. The score measures greenhouse gas emissions that are associated with the production, distribution and consumption of a fuel. This is measured in grams of carbon dioxide equivalent to megajoule.
The electricity we generate using fossil fuels is more intensive, while renewable energy sources such as solar power and hydro power produce smaller amounts of carbon dioxide emissions – making renewable energy much lower or potentially net zero.
By understanding the carbon intensity of electricity use, people can reduce carbon emissions by actively using electricity with a lower carbon intensity value.
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The Importance of Carbon Intensity
Many organizations, markets and regulators use Carbon Intensity, or CI, as a key metric to determine carbon and climate performance. For oil and gas, CI is a key reporting metric used to assess the carbon performance of producers, helping them make better-informed decisions.
As investors request oil, gas and energy organizations to evaluate and disclose their carbon emission impacts to their portfolios, it is becoming increasingly important for these companies to perform more CI-related portfolio analysis. CI is becoming more mainstream, and no matter the size of the organization, it needs to be considered alongside other Health and Safety Environmental performance metrics.
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Carbon Intensity for Climate Change Mitigation
In 2019, less than 2,000 companies reported their carbon emissions to organisations such as the Carbon Disclosure Project or in annual reports [Ref?]. Today, a range of global organisations have pledged to cut their carbon emissions however, cuts to corporate emissions remain voluntary. This is why it’s vital for governments to mandate reductions to both public and private companies, policies that enable regulators to gain greater insight into the corporate sector’s impact on global warming and climate change.
There are a variety of measures for carbon intensity however, the below mentioned are the most popular. Currently, there are debates regarding which of the two ways is the most effective to measure carbon emissions
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Carbon emissions scaled by a company’s revenue – a measure that is backed by the Task Force for Climate Related Financial Disclosure
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Carbon emissions scaled by Enterprise Value Including Cash (EVIC) – a measure proposed by the EU Technical Expert Group on Sustainable Finance (TEG)
The TEGs rationale for using EVIC is that this measure reflects a company’s standard assets – that is: a company’s assets tied to proven or probable fossil fuel reserves. This rationale has received criticism because opponents are pointing to a significant growth bias associated with it and a higher implementation cost to companies. However, both measures are mostly equivalent and acceptable for investment purposes.
Climate investing is growing in importance as company investors are actively seeking ways to combat global warming and climate change. Reporting carbon intensity rather than carbon emissions gives investors a metric they can use to benchmark companies.
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Technology to measure, mitigate and reduce greenhouse gas emissions across sectors
Technological advancements are playing a vital role in the mitigation and reduction of greenhouse gases in the atmosphere, helping investors, industrial sectors, organizations, and companies reduce their carbon footprint and lower their carbon intensity.
GHGSat is the world leader in high-resolution greenhouse gas emissions monitoring from space, combined with aircraft services and emission analytics to deliver customized and actionable emissions intelligence for operators, governments and financial services worldwide.
The oil and gas sector is able to invest in technology designed to detect, monitor, and measure emissions from oil and gas assets such as gas plants, well pads, and compression stations. By understanding carbon intensity and by measuring GHG emissions, businesses in the oil and gas sector are able to mitigate and reduce intensity, meaning a significant and measurable reduction in the amount of greenhouse gases emitted.
Methane intensity is also an important way to mitigate greenhouse gas emissions across sectors. GHGSat offers a free Methane Emissions Calculator, making it easier to understand methane emission rates and calibrate emissions measurements.
With GHGSat’s cutting-edge data technology, these organizations are able to accurately identify emission sources to individual facilities, from unlit flares to open thief hatches, supporting leak detection and repair (LDAR) activities, production operations and environmental reporting.
When it comes to coal mines, GHGSat’s emissions monitoring fleet of high-resolution satellites detects and measures emissions from individual industrial facilities with accuracy.
Effective emissions reduction strategies and policies to reduce carbon intensity rely on good data. It is vital that organizations take the right action to meet sustainable development goals and reduce emissions with accurate, transparent and timely measurements of greenhouse gas emissions. To ensure the proper regulations and mitigation plans are put in place, consistent and reliable emissions monitoring is critical.
GHGSat has the technology to do this today.
