All sectors : french regulatory GHG reporting
The Act of 12 July 2010 relating to the "National Commitment to the Environment" (Engagement National pour l’Environnement) laid down the principle of the general application of greenhouse gas emission inventories for a certain number of stakeholders (see extract of article L.229-25). The objective of GHG emission inventories is to produce a diagnostic of the greenhouse gas emissions of public and private stakeholders, with a view to identifying and mobilizing avenues for reducing these emissions.
The Bill on "Energy Transition for Green Growth" (Transition Energétique pour la Croissance Verte) is intended to develop the legislation regarding:
Who is concerned?
- Companies with more than 500 employees (250 in the overseas departments)
- Collectivities with more than 50,000 inhabitants
- Public establishments with more than 250 employees
- State services
Extract from art. L.229-25 (article 75 – section 4).
"Art. L. 229-25. − The following are obliged to establish an inventory of their greenhouse gas emissions:
1/ Legal persons under private law employing more than 500 people
2/ In the overseas regions and departments of France, legal persons under private law employing more than 250 people and exercising the activities defined in 1/;
3/ The State, the regions, the departments, the urban communities, the agglomeration communities and the communes or groupings of communes with more than 50,000 inhabitants, along with other legal persons under public law employing more than 250 people.
The State and the persons mentioned in 1/ to 3/ shall enclose with this inventory a summary of the actions envisaged for reducing their greenhouse gas emissions.
This inventory shall be made public. It shall be updated at least every three years.
It must be drawn up by no later than 31 December 2012. A method for drawing up this inventory shall be made available free of charge to the territorial collectivities and their groupings.
The greenhouse gas emission inventories for the persons mentioned in 3/ shall relate to their patrimony and their competences.
In each Region, the Prefect of the Region and the President of the Conseil Régional (regional council) are responsible for coordinating data collection, implementing a general inventory and checking the coherence of the GHG inventories."
The enforcement decree was published in the Official Journal of 11 July 2011 and stipulates that the Ministry responsible for the environment shall organize the publication of the methodological information required for compliance with the Act (art. R229-49). These methodological elements, validated and published by the Minister for the Environment, meet this regulatory requirement with a view to the drafting of greenhouse gas emission inventories.
The methodological elements have been drawn up in the framework of the work of the national coordination hub for greenhouse gas emission accounting, created by Decree No. 2011-829. Drawing on existing benchmarks, in particular those defined on an international scale, these methodological elements have given rise to a regulatory method broken down into three documents which have been the subject of major technical work in conjunction with representatives of the stakeholders concerned by the implementation of article 75 (companies, local authorities [collectivities] and State services). These documents have also incorporated input from the Emissions Inventories Consultation and Information Group (Groupe de Concertation et d’Information sur les Inventaires d’Émissions).
The regulatory method is divided into three parts:
- general method: applicable to any organization
- specific guide for collectivities (local authorities) : supplements the general method with methodological points specific to collectivities
- submission format
A specific methodological guide for collectivities (local authorities) is intended to specify certain methodological points specific to local authorities. This guide is not self-contained, and so, when carrying out the GHG emissions inventory for a collectivity, the general methodology should also be referred to.
A version 2 of the general method, drawn up in the framework of the work of the national coordination hub for greenhouse gas emission accounting, is now online. It introduces in particular a major modification, by selecting the control approach for determining the emission sources covered by the inventory. The control approach (operational or financial) replaces the principle of only taking into account the greenhouse gas emission sources pertaining to the legal entity carrying out its inventory.
This method change underpins the consistency of the mechanism with respect to the international benchmarks (ISO 14064 standard and the GHG protocol) while offering greater flexibility to entities carrying out their inventories in order to make the inventory more consistent with their activities.
The changes to version 2 of the general methodology have no effect on the basics of the specific guide for collectivities, aside from corrections relating to consistency in the drafting.
Since these methodological changes have been introduced at a time when the legal entities under the obligation to draw up a GHG emissions inventory may already have initiated or finalized this work, inventories made in accordance with either of the two versions of the general method shall be acceptable in order to fulfill the obligation of the first deadline of 31/12/2012. Beyond this deadline, only the latest published version of the method shall be valid.
The FAQs have been updated in compliance with version 2 of the method.
The main points of this method:
- The obligation to take into account direct and indirect emissions linked to the consumption of electricity, heat or steam needed for the activities of the legal person (SCOPES 1 and 2).
- SCOPE 3 (the other indirect emissions) is optional but recommended.
- Exercise covering the patrimony and competences of the collectivity: this means taking into account the emissions generated by the activities and services of the collectivity and by the implementation of its competences via an organizational approach (including for services whose operation has been outsourced, in the same way as for a company). The method nevertheless recommends supplementing the Patrimony and Competences inventory with a territorial inventory in order to best dovetail with the objectives of the PCET. The two scales must however be treated separately in order to meet the obligation.
- This inventory must be updated every 3 years.
- The emission factors to be used by default are those of the Base Carbone® (for electricity, reference to the Base Carbone® is mandatory). The collectivity has the possibility to choose other emission factors if these can be justified.
- An action plan must be drawn up. For collectivities, this action plan is the PCET, whose range will depend on the scale and on the emissions included in the GHG emissions inventory.
- ADEME strongly recommends using this obligation as a first step in GHG emissions accounting, by implementing it from the outset with all the SCOPES and on the scale of the Territory.
Why go beyond the legal requirements?
The regulations propose implementation of a GHG inventory which makes it possible to account for a proportion of emissions. This first step enables many stakeholders to start out on GHG accounting and become aware of its impact on emissions both nationally and internationally. ADEME recommends going beyond the regulatory requirements by taking into account all GHG emissions.
The regulations have limited the obligation for carrying out GHG inventories:
- to direct emissions (SCOPE 1) and indirect emissions linked to electricity, heating networks, steam and cooling (SCOPE 2)
- for collectivities on the scale of their patrimony and their competences (P&C).
The regulations nevertheless recommend that GHG inventories should be carried out:
- taking into account all other indirect emissions (SCOPE 3)
- by collectivities on the Territorial scale.
Whether or not you are eligible for the regulations, it is advisable to carry out your inventory from year one using a global method, i.e.: taking into account all direct and indirect emissions (SCOPES 1, 2 and 3).
It is indeed only by taking into account all emissions that you can obtain a complete overview of your activity. It is on this basis that all the action levers for reducing emissions can be identified. Limiting the inventory to the emissions of scopes 1 and 2 alone means failing to take into account the total activity of your company, your collectivity or your territory, none of which operate in a vacuum. The inventory will therefore only be partial and will only reflect one part of reality.
Taking account of the entire value chain of your activity will make it possible to extend the range of actions to be implemented, bring together the stakeholders involved in the activity (suppliers, clients, visitors), and set the organization on the path toward a long-term strategy.
What is more, for companies, indirect emissions often represent almost 75% of the emissions for an activity. Not taking them into account would amount to identifying only a small proportion of overall emissions. Business tends to be dependent on fossil fuels (processes, fuels, raw materials). Omitting three-quarters of these emissions does not therefore enable the company, collectivity or territory to measure its vulnerability in the face of the future increases in the price of these fossil fuels, which will inevitably affect its activity and competitiveness.
Furthermore, for collectivities, taking into account emissions over the entire territory is vital within the context of a PCET (Plan Climat Energie Territoire - Territorial Climate & Energy Plan). It is indeed only on this scale that the collectivity will be able to establish a complete diagnostic, taking into account all activities on the territory and, in this way, define an action plan covering all parties concerned.