Carbon footprint of London's local authority procurement
04 November 2010
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- Plans to cut carbon can focus on local authority procurement. On average, every £ million of expenditure by local authorities in London resulted in 337 tonnes of GHG emissions, measured in carbon dioxide equivalent (CO2e). Local authorities with smaller carbon footprints than the average are well placed for controls on carbon and could help others identify carbon savings in their supply chains.
- Local authority carbon footprints provide a baseline for targets to reduce emissions from supply chains. A range in the carbon footprints of procurement from 167 tCO2e per £ million of expenditure to 674 tCO2e/£ mn suggests that some local authorities could make big improvements in carbon efficiency.
- Plans to cut carbon can focus on sectors that add most to carbon footprints. The overall supply chain carbon footprint is mainly due to the high carbon intensity of sectors such as Utilities and Construction. Carbon footprints vary widely for local authority expenditure in these sectors. Authorities can target categories of spend with large carbon footprints to reduce emissions from their supply chains.
- Variations in the carbon performance of suppliers in carbon-intensive sectors highlights opportunities to cut carbon. Variations in the carbon intensity of companies providing similar goods and services are greatest in the Catering, Building Construction Materials and Facilities & Management Services sectors. For instance, the carbon intensity of Catering companies ranges from 226 tCO2e/£ mn to 5,762 tCO2e/£ mn.
- Authorities can encourage carbon-intensive suppliers to reduce emissions. Trucost modelled potential carbon savings. If companies in 10 sectors were at least as carbon efficient as the average for their industries, London's local authorities could cut annual emissions by 582,304 tonnes of CO2e. This would shrink their overall carbon footprint by 23% to 260 tCO2e/£ mn.
- Information on where GHG emissions come from can pinpoint carbon ‘hotspots'. Suppliers directly emit 37 per cent of GHGs linked to local authority procurement. The electricity they use causes another 11 per cent of emissions, and the remaining 52 per cent are from their wider supply chains. Carbon hotspots, which could deliver the biggest emission reductions, vary for companies in different sectors.
- Local authorities could encourage suppliers to disclose, manage and cut carbon emissions. Over 200 companies that confirmed carbon data through Trucost's engagement programme emitted over 30 per cent of GHGs analysed in this study. The resulting carbon data showed that suppliers in 11 sectors could cut emissions from their electricity use by over 1 million tonnes of CO2e. Improving their energy efficiency could also cut their electricity bills by over £168 million.
- London's local authorities could co-operate to cut supply chain emissions. Many of the authorities share the same suppliers and co-operating through engagement would increase their influence to encourage emission reductions. They could share information and resources to ask carbon-intensive long-term suppliers to improve their carbon performance. Sharing tools to monitor and manage carbon performance could support cost-effective carbon reduction plans.
Capital Ambition commissioned Trucost to measure the carbon footprints of the supply chains of London local authorities. The study provides insight into the main sources of greenhouse gas (GHG) emissions from their procurement. Trucost engaged with suppliers of goods and services and shared information with local authorities about opportunities to cut carbon, which could also result in cost savings
Why did Capital Ambition commission the research?
A critical gap in information about sources of GHG emissions in supply chains was presenting a barrier to embedding carbon management in procurement decisions. Capital Ambition therefore commissioned Trucost to assess the carbon footprints of London authority supply chains. The project included an engagement programme to share knowledge about the main sources of emissions identified and opportunities to reduce these.
This project also supported an initiative to embed the climate change agenda across all London authorities through activities including engagement, leadership and improving service-level buy in. The study built on a programme by Capital Ambition and London Councils to share best practice on reducing emissions among local authorities as part of the National Climate Change Best Practice Programme.