Author: 3Degrees Staff

At 3Degrees, we make it possible for businesses and their customers to take urgent action on climate change— providing renewable energy and carbon offset solutions to Fortune 500 companies, utilities, universities, green building firms and other organizations that are working to make their operations more sustainable. And as a certified B Corporation and eight-time winner of the EPA Green Power Supplier of the Year award, we’re primed to deliver custom clean power solutions that will help each organization make an environmental impact. Founded in 2007, 3Degrees is headquartered in San Francisco, California, with offices across the United States.

Journey to Zero: Four key action areas to achieve net zero emissions

To address the growing climate crisis, more organizations than ever before are setting climate goals, such as net zero, carbon neutrality, or SBTi goals. But committing to reach net zero emissions and executing on climate goals are two very different things. In this free “Journey to Zero” white paper, we’ll discuss how organizations can embrace this climate opportunity, and outline the four key action areas to help companies get started on their journey to zero, including:

  • Fully integrating decarbonization efforts into an organization’s business strategy — from articulating a business case for action, to taking inventory on GHG emissions.
  • Actions that organizations can take to address their emissions from operational activities. For example: electricity purchased to operate office and manufacturing facilities where fossil fuels are burned to make the electricity
  • Addressing Scope 3 value chain emissions, which constitute the majority of GHG emissions for most organizations
  • Using carbon credits — also known as carbon offsets or verified emissions reductions or removals (VERs) — to compensate for emissions that remain after all other internal reduction measures have been implemented

Download the white paper

Journey to zero: four key action areas to achieve net zero emissions
– part 2

Car driving in Norway

In the first blog in our Journey to Zero series, we discussed how a growing number of organizations are setting climate goals, such as net zero, carbon neutrality, or goals approved by the Science Based Targets initiative (SBTi). We also reviewed the first two of four key action areas to help companies get started on their journey to net zero emissions: Business Strategy Integration and Operational Reductions. There was some important groundwork laid in that article, so I encourage you to go back and give it a quick read if you missed it.

In this second and final blog of the series, we’ll be diving into the next two action areas, Value Chain Reductions and Remaining Emissions, and wrapping up with some thoughts on prioritizing your company’s net zero efforts.

Value chain reductions

Most companies will find that their value chain — or Scope 3 — emissions constitute the majority of their GHG emissions. Value chain emissions are derived from sources upstream or downstream of your organization’s operational boundary but are still within your scope of influence. More specifically, supply chain emissions within the value chain commonly represent the biggest share of a company’s emissions footprint.

For example, a consumer packaged goods company might discover that a significant amount of its emissions are generated by fertilizer used during the manufacturing of its food products, since the fertilizer emits the powerful warming gas nitrous oxide.

Tackling value chain emissions can be complex and requires robust planning — and the carbon reduction impact is typically significant. For this reason, a plan to address Scope 3 value chain emissions is a critical component to any climate strategy. Common steps in a value chain action plan include:

  • Conducting a Scope 3 emissions screen and hotspot analysis or a product-level life cycle analysis (LCA) that maps all sources of emissions from a specific product
  • Engaging suppliers to obtain primary emissions data
  • Developing a strategy to engage suppliers in carbon reduction initiatives, such as converting to renewable energy use
  • Creating a system of recognition and/or rewards for suppliers that are successful in their GHG reduction efforts

Remaining emissions

Last but not least, an organization’s net zero strategy is not complete without a plan to address the emissions that remain after all other internal reduction measures have been implemented.

Even companies that are highly successful in reducing their GHG footprint across all three emissions scopes will have some remaining emissions that need to be addressed in order to reach their climate goal. This is where carbon credits — also known as carbon offsets or verified emissions reductions or removals (VERs) — come in. Incorporating carbon credits into a larger GHG reduction effort enables organizations to compensate for unabated Scope 1 and 3 emissions today, while making progress towards longer-term goals like net zero.

It’s not always easy for companies to determine the best path forward with respect to carbon credits. The carbon market is evolving quickly, and there is not yet a standard for exactly how carbon removals will be used to meet long-term net zero goals (though one is currently being developed). While there are differing opinions on the role of carbon credits in achieving climate goals, there’s common consensus that a corporate-level net zero claim must balance all residual emissions with removals from the atmosphere or ocean.

As a result, many buyers are starting to shift towards carbon removal versus avoided emissions projects, and removals tend to be front and center in the dialogue around the future state of net zero. That said, carbon removal technology is still relatively nascent, and there is a fair bit of uncertainty: What will be considered an appropriate carbon removal credit to meet the still-being-crafted standard? How should organizations think about projects that offer short-term versus long-term durability?

Given this evolving landscape, a company can begin to integrate investments in carbon removal projects today as a small part of its current portfolio, alongside carbon avoidance projects. It’s important to recognize that implementing a carbon credit strategy is not a replacement for doing the hard work of emissions reductions but should be a complement to a longer-term internal reduction strategy. Support for high-quality, third-party verified carbon projects that avoid emissions in the near term is an important tool in guiding an organization’s path towards longer-term climate goals.

Prioritizing net zero efforts

Together, these four action areas form a comprehensive framework of corporate action. Keep in mind that these efforts should overlay with bigger-picture thinking about understanding the climate crisis and the role your company can play in shaping and supporting a net zero economy on a global scale. Which brings us full circle to the original question: What’s your company’s climate opportunity?

If you’re interested in learning more about how you can support your company’s journey to net zero, I encourage you to visit our new Net Zero Resource Center to download an infographic that covers all four action areas, watch a quick video, and view other helpful resources.

Carbon credit project taxonomy – (infographic)

carbon project types infographic

There are several categories of carbon credit projects. To determine how to best address your organizational emissions through the purchase of carbon credits, it is vital to understand the differences between the various project types. 

Download this helpful infographic to understand the unique attributes of avoided emissions and carbon removal projects and their carbon storage potential.

 

Want more information? Take a look at our Carbon Credits page, or Contact us.

Journey to zero: four key action areas to achieve net zero emissions – part 1

net zero emissions

To address the growing climate crisis, more organizations than ever before are setting climate goals, such as net zero, carbon neutrality, or SBTi goals. But committing to reach net zero emissions and executing on climate goals are two very different things. In this first article of a two-part series, we’ll discuss how organizations can embrace this climate opportunity, and outline the first two of four key action areas to help companies get started on their journey to zero.

Regardless of where you are in your journey, the question at the heart of your net zero strategy should be: What is your organization’s climate opportunity?

While short-term, programmatic goals are important (more on that later), it’s critical to determine how you can leverage your company’s superpowers to help create a net zero world and thrive in it. While the climate emergency requires organizations to implement rapid and deep decarbonization initiatives across all three scopes of emissions, it also presents a unique opportunity for them to innovate around products and services that can support and propel faster decarbonization, creating real value for customers, employees, and shareholders. A great example of this is the dramatic shift the transportation sector has undertaken towards electrification. 

Your organization’s climate superpowers may not be immediately apparent. Creating programmatic goals can help illuminate your unique climate opportunity, while also taking immediate action to reduce your greenhouse gas (GHG) emissions. Let’s take a deeper look at each of the following key action areas:

  • Business Strategy Integration
  • Operational Reductions
  • Value Chain Reductions
  • Remaining Emissions

Business Strategy Integration

Like any other important business initiative, an organization’s decarbonization efforts should be fully integrated into its existing business strategy. Getting started will require climate intelligence on topics such as:

  • Benchmarking competitive actions and goals 
  • Reporting and climate disclosures
  • Customer and shareholder expectations
  • Annual greenhouse gas (GHG) inventory

Cumulatively, these pieces of information can help you clearly articulate your business case for action, which needs to be well-articulated, supported by emissions data, and shared in the language of your most important stakeholders.

To develop your business case, a common starting place is benchmarking. What are your peers doing with respect to net zero goals? How do your organization’s climate actions stack up? 

Another starting point is conducting a risk assessment and disclosure of climate risk to investors. The most common climate risk reporting framework is the TCFD framework, which refers to the Taskforce for Climate-Related Financial Disclosures, the organization that put forth recommendations on how and what to report as part of climate risk. 

Underpinning all of these efforts is a need for robust climate understanding and stakeholder education. A “climate boot camp” for stakeholders may include topics such as definitions of common climate commitments, high watermark activities of leaders, a crash course in greenhouse gas accounting, and identification of your climate risks and opportunities.

Finally, any foundational work needs to include an annual GHG emissions inventory. Including important data on key emissions hotspots is required in order to set a meaningful strategy.

The most effective climate strategies take all these actions together and weave them into an organization’s current business strategy to complement and support its mission, vision, and values.

Operational Reductions

Operational reductions refer to actions an organization can take to address their emissions from activities such as:

  • Electricity purchased to operate office and manufacturing facilities where fossil fuels are burned to make the electricity
  • Direct burning of fossil fuels, like gallons of gas purchased to fuel company cars or natural gas used in a co-gen plant

These operational emissions, known as Scope 1 and 2 emissions, are a common starting point for reductions. Many companies also consider some Scope 3 emissions, such as those from employee commuting and company travel, as part of their operational boundaries. 

To accomplish these emissions reductions, companies often find quick wins from energy efficiency projects, installing rooftop solar, and purchasing renewable energy. Renewable technology is available today and can be a valuable source of near-term action since companies have direct control over their electricity procurement.

In part two of this blog series, we’ll cover the remaining action areas: Value Chain Reductions and Addressing Remaining Emissions. In the meantime, feel free to visit our new Net Zero Resource Center to download an infographic that covers all four stages, watch a quick video about beginning your journey to net zero, and view other helpful resources.

Okta is Addressing its North American Electricity Emissions While Supporting California Schools

For Okta, an innovative San Francisco-based identity company, addressing its impact on the climate is a foundational component to one of its three Environmental, Social, and Corporate Governance (ESG) pillars. While the company understood the need to confront its greenhouse gas (GHG) emissions, Okta was at the very beginning of its decarbonization journey and, like many other organizations starting out, wanted to make an impactful first step. In August of 2020, Okta completed its first GHG emissions assessment which allowed it to measure its emissions, establish baselines, and begin to define renewable energy and carbon reduction goals.

With this information, Okta approached 3Degrees to help develop a plan to procure renewable energy to address its energy consumption, while also having a positive effect on the community.

The Opportunity

Over the past 15 years, 3Degrees has supported The California Bright Schools Program with the procurement of more than 173,000 MWhs of solar RECs from school districts throughout California. Taking into account its desire for community impact, purchasing RECs from California schools proved to be a perfect fit for Okta. 

The Bright Schools Program was born out of a vision for school districts to proliferate solar energy adoption and save general fund dollars, while providing clean energy education for students and teachers. This program, implemented through the California Energy Commission, helps identify the most cost-effective energy saving opportunities and supports the installation of photovoltaic solar systems on schools across the state.

The Milpitas Unified School District (MUSD), just southeast of San Francisco, is a great example of how schools are benefiting from solar development. As a participant in the Bright Schools Program, the Milpitas Unified School District is estimated to save $12 million over the portfolio’s lifespan. The district has also created an additional revenue stream through the  sale of renewable energy certificates (RECs) generated by the system, which 3Degrees has been purchasing since 2009.

How we helped

Working closely with Okta, 3Degrees assessed the company’s purchase criteria and developed a portfolio of renewable energy options that would meet its energy requirements and desire for additional co-benefits. Through the purchase of RECs generated from the Bright Schools Program’s solar network, Okta was able to demonstrate its commitment to the environment and the community. The purchase helped Okta meet its renewable energy goal for 2020, while also making a positive impact on California schools.

“Every organization should be taking action on climate change, as it adversely affects our people and planet. At Okta, we’re early in our journey, but we’re committed to doing our part and reducing our Greenhouse Gas (GHG) emissions. We’re implementing energy efficiency efforts to reduce consumption at our offices — and for energy we consume, we’re investing in renewable energy projects with positive environmental and social impacts. We value our partnership with 3Degrees and their expertise in this area.”

— Alison Colwell, Director of ESG and Sustainability, Okta

 

Results

Okta’s initial purchase was large enough to address its entire Scope 2 emissions footprint in the United States. By supporting the Bright Schools Program, Okta was able to create a meaningful connection for its employee stakeholders and highlight the tangible benefits of its efforts. 

 

Okta’s purchase is an example of how organizations can go beyond “checking the box” with their renewable energy purchases and support projects with strong co-benefits, demonstrating that even a first step can also be meaningful to stakeholders and impactful to communities. Acknowledging that this is just the beginning of its journey, Okta is already looking ahead at options to address its international Scope 2 emissions, as well as ways to address its indirect Scope 3 emissions.

ALDI enhances sustainability leadership with multi-year renewable energy purchase

aldi-rooftop-solar

Aldi-logo

Aldi-case-study-graphic

Protecting the environment has been a priority for ALDI for many years. In 2014, the company began implementation of its first international climate strategy, which included the goal of reducing its greenhouse gas (GHG) emissions by 30% per square meter of sales area by 2020.

In 2021, ALDI South, which includes ALDI U.S., went a step further and announced it would join the Science Based Target Initiative (SBTi), committing to reduce its overall operational emissions by more than a quarter by 2025 as part of the company’s 2030 vision for sustainability. Additionally, ALDI has encouraged 75% of its suppliers to commit to science-based targets by 2024.

ALDI U.S. continues to implement initiatives in support of these goals, including integrating solar design for stores and warehouses where feasible, and procuring 100% renewable energy for all of its operations. ALDI achieves this through a portfolio approach using onsite solar generation, competitive retail supply contracts, and independently sourced unbundled renewable energy certificates (RECs). ALDI enlisted 3Degrees to help evaluate its short- and long-term goals, inform the company’s procurement strategy, and execute its first purchase of renewable energy.

Challenges

ALDI outlined several criteria to ensure its renewable energy purchasing strategy was a good fit with its business model. To this end, 3Degrees’ recommended approach needed to:

  • Support the company’s aggressive U.S. growth plan
  • Fit within its existing energy procurement strategy
  • Mitigate potential REC market volatility, while providing flexibility to handle the company’s projected growth and any future changes to how it procures renewable energy
  • Provide meaningful impact

Additionally, since this would be its first large-scale renewable energy purchase in the United States, the ALDI team was looking for support educating national and international stakeholders on renewable energy certificates (RECs), their role in a renewable energy purchasing strategy, and the challenges unique to purchasing renewable energy in the U.S.

How we helped

3Degrees took the company’s needs into careful consideration and created a tailored plan to deliver on the ALDI goals of meeting 100% renewable energy for all of its U.S. operations while mitigating risk and providing some long-term price certainty.

We began by engaging ALDI, educating key stakeholders, and completing a renewable energy options assessment which outlined the various paths that the company could take to achieve its goals. As a result, ALDI elected to move forward with a multi-year REC purchase that would serve as the anchor point for its most immediate renewable energy needs in the U.S. but still provide flexibility to explore options beyond unbundled RECs over time. Our work with the ALDI team also supported the business case for a longer-term renewable energy procurement strategy that balances impact and economics while allowing the company to drive rapid adoption of renewable energy within its operating footprint.

“ALDI has been investing in programs to protect the environment for many years now, and our commitment to our climate strategy is a significant corporate priority. We are thrilled to partner with 3Degrees on this unique, multi-year REC purchase, which will play an important role in helping us achieve our renewable energy goals.”

— Dan Gavin, Senior VP of National Real Estate, ALDI

Results

Aldi-interior

Through its long-term REC procurement, ALDI:

  • Is addressing 100% of its U.S. electricity load with renewable energy at a favorable fixed price in the short term
  • Sets the stage for its renewable energy procurement strategy to play a pivotal role in achieving the company’s ambitious science-based target GHG goal
  • Demonstrates the role RECs can play in enabling a realistic, business-conscious approach to GHG reduction
  • Is able to make a meaningful impact in the national renewable portfolio through its investment

Carbon Credits’ Role in Achieving Net Zero, Carbon Neutrality, and SBTi Targets

The Evolution of Corporate Climate Commitments

Organizations around the world are increasingly focused on setting and achieving ambitious GHG reduction targets including net zero emissions, carbon neutrality, and science-based. However, with evolving methodologies and tools, understanding available options and developing a strategy for achieving these targets can be challenging.

This white paper, “The Evolution of Corporate Climate Commitments: The Role of Carbon Credits in Achieving Net Zero, Carbon Neutrality and SBTi Targets,” discusses:

  • A detailed summary of the most common GHG reduction targets – carbon neutrality, science-based, and net zero emissions
  • How these targets can work in concert to help achieve meaningful and long-term emissions reductions
  • The spectrum of strategies and tools that can map to the various targets
  • The role that carbon credits, including nature-based solutions, carbon removals, and value chain interventions play in meeting these commitments

Explore this white paper to learn how your organization can develop its own strategy for significant and impactful decarbonization.

     

     

    Driving the transition to net zero emissions

    Across the OEM motor vehicle aftersales space, transportation is a significant spend – approximately 7-8%(1) of sales. Further, the transportation sector has now surpassed the power sector as the largest emitter of greenhouse gases (GHGs) in the United States, responsible for over 29%(2) of total emissions within the U.S., and 24%(3) globally. This trend largely is driven by the growth of e-commerce, international and domestic shipping, and other activities related to globalization.

    Many of the OEMs participating in Carlisle’s North American Parts Benchmark have released corporate statements committing themselves to reducing their climate impact, yet many organizations are early in the development of plans to address the greenhouse gas emissions associated with their transportation footprint. Fortunately, meaningful pathways to reduce transportation emissions are taking hold.

    Where to begin?

    We’ve laid out our perspectives on how to pluck lower hanging fruit and to either start or accelerate the journey towards decarbonizing transportation-related emissions.

    1. Calculating an Organization’s Greenhouse Gas Emissions Profile
      Calculating an organization’s greenhouse gas emissions profile or “carbon footprint” circumscribes an organization’s emissions and creates a heat map for understanding where and in what size emissions are occurring. It is like tracking a person’s caloric intake over time for the purpose of designing a diet that gets results while minimizing disruption to their lifestyle. Ice cream every night or just on weekends?

    2. Decarbonizing the Warehouse
      Decarbonizing the warehousecan be a fertile ground for quick wins. Tried and true onsite energy minimization efforts — such as LED lighting, onsite solar installation, high efficiency space heating and cooling, or being paid to reduce energy use during periods of peak grid congestion — can offer attractive financial return profiles while providing greenhouse gas reduction benefits. When paired with backup battery storage systems, these efforts can also increase the energy resiliency of warehouse operations.

      More recently, an increasing number of companies are deploying Material Handling Equipment (MHE) powered by lower carbon fuels, such as electric or hydrogen powered forklifts, and other non-road cargo equipment. Leveraging various sources of public funding for these vehicles, such as the Low Carbon Fuels Standards incentive regimes in California, Oregon, and a growing list of other states, can deliver attractive additional revenue streams. These funds can further enhance total cost of ownership economics and help support more rapid electric vehicle deployment that lowers the GHG emissions of owned or leased mobile sources.

    3. Transitioning to Low Carbon Shipping Fuels
      The global transportation sector has begun integrating low carbon shipping fuels at an accelerated rate, in large part focused on last mile delivery and supported by decision tools that identify economically attractive alternatives to internal combustion engine (ICE) transport. Natural vehicle replacement cycles — both within and outside the warehouse — present good opportunities for organizations to begin to pilot electric, hydrogen, CNG, and other lower carbon fueled vehicles, again, especially for California and Oregon operations.

    4. Targeting the Remaining Unavoidable Greenhouse Gas Emissions
      Many companies mitigate the impact of the remaining unavoidable greenhouse gas emissions through the purchase of high-caliber verified carbon emissions reductions, otherwise known as carbon credits or carbon offsets, as a stepping-stone to complement, rather than replace, existing decarbonization strategies throughout their own operations.

    5. Reducing the Need to Move Materials and People
      Having said this, the best way to reduce greenhouse gas emissions in transportation is by reducing the need to move materials and people. A comprehensive review of your supply chain – including buildings, material flow, transportation modes, inventory deployment strategies, referral patterns, etc. will allow you to understand not only the cost/service trade-offs, but the environmental tradeoffs as well. For example, increasing forward-deployed safety stock may increase inventory costs, but may also reduce parcel/air referrals. Ideally, this should be a positive financial trade-off. But if not, is your organization willing to pay for reduced carbon emissions?

    Takeaways:

    Combined with policy advocacy, vendor negotiation, and peer collaboration, the above strategies can represent a comprehensive approach to reduce the largest source of emissions globally.

    Carlisle and its decarbonization partner, 3Degrees, have helped clients ranging from Rivian to Proterra understand and address the impact of their transportation-related emissions with a range of solutions customized to meet their unique business needs and sustainability goals.

     


    Harry Hollenberg, Managing Director of Carlisle & Company

    Carlisle & Company is the leader in aftersales strategy and insights, partnering with a range of highly engineered clients to solve their most complex business problems, drive growth, and create value.

     

     

    Dan Kalafatas, Chairman of 3Degrees and former Carlisle & Company Manager

    Dan serves as the chairman of 3Degrees’ board of directors, focusing on the company’s long-term corporate strategy and strategic initiatives.

     

     

    Willits Woods – Improved Forest Management

    Willits Woods IFM Project

    Mendocino County is a quiet and secluded community nestled between the rocky coastline of Northwestern California, and the wooded terrain of old-growth redwood groves. In the heart of Mendocino County is the 19,000-acre Willits Woods project area which is home to a wide variety of natural communities, including redwood, Douglas fir, coastal oak, mixed chaparral, montane hardwood, grassland, and coastal sage scrubland.

    Forest management practices of this area have varied over the years as ownership of the land has changed. Heavily forested in the nineteenth and early twentieth centuries, Northern California woods such as this often incur the negative impacts of excessive logging—loss of wildlife habitat, reduced carbon storage potential, and heavy erosion which deposits sediment into waterways. 

    For years, local timber companies had subjected this landscape to unsustainable harvest practices. Since the development of the Willits Woods IFM Project, there have been no commercial timber harvesting activities. Willits Woods’ forest plan provides a full range of improved watershed benefits. Its conservation efforts focus on fostering the health of  migratory birds, riparian forest, streams, springs and wetland ecosystems. The project’s use of sustainable forest management practices increases the amount of carbon that can be absorbed and stored. The Willits Woods forest, like many other improved forest management projects, serves as a critical nature-based solution to climate change by avoiding carbon emissions from over-harvesting as well as removing carbon from the atmosphere through sequestration. Because the project is crediting new growth, the credits being offered from the project are considered carbon removals.

     

    CO-BENEFITS:

    Environmental:

    The implemented forest management plan at Willits Woods protects biodiversity and provides habitat for sensitive species, such as the Yellow-Legged Frog, Marbled Murrelet, Red Tree Vole, and the Pacific Fisher. Sustainable management of Willits Woods improves landscape ecological health, safeguards water purification, and strengthens soil stabilization. Conservation efforts help sustain critical ecosystems for coho, pink and chinook salmon as well as steelhead fish populations.

     

    Social:

    Protected forest within the project area offers the local community a place to enjoy numerous recreational opportunities, such as hiking, camping, swimming, and horseback riding.

    3Degrees + carbon offsets

    View other project profiles or contact us.