Since July 2020, Market Lane has been proudly carbon neutral. The journey to becoming carbon neutral was challenging, fascinating and extremly important to us, and we've learnt a lot in the process! Now that we’re a few years in, we’re keen to share as much as we can about what was involved, and how to go about doing it.
We’ve written this guide for our suppliers, industry peers, wholesale partners and curious business owners (from any industry) who may want to become carbon neutral but don’t know where to start. If this is you, please read on (and then do it)!
Why we became carbon neutral
We became carbon neutral so we could reduce our impact on the environment by working out what we were emitting, and then using this information to build a strategy to reduce these emissions and offset what we couldn’t reduce or eliminate.
How we went about it
Initially, we tried to become carbon neutral on our own. We spent about six months deep in spreadsheets and doing a lot of online research. This was challenging! “It was difficult to determine what our organisational boundaries were,” Market Lane Co-founder Jason Scheltus says. “What we should include, what we didn’t need to include, and where to start.” Finally, understanding that we needed to engage some experts to help us, we approached carbon and energy management consultants, Pangolin Associates, who had the expertise and tools we needed to help us through the process.
Here are the steps we took with Pangolin:
Step 1: A carbon assessment
Pangolin first defined two key elements in assessing our carbon emissions: the organisational boundary and our operational control. (Please see our glossary below for term definitions.) Basically, these define what emitting activities our company is responsible for, and where we do and don’t control the direct emissions.
Next, we reviewed every cost in our Profit and Loss statement and tried to quantify our activities – for example, kilograms of waste, litres of water used and kilowatts of electricity.
Pangolin helped us assess all the data; what we had available, what might be difficult to source, and what might not exist. They created a data management plan to help us source the information available now, and devise how to get missing information in future. We inputted all our data and assumptions into a large spreadsheet, with a row for every expense item in our business.
Step 2: Calculating emissions
Pangolin took the data we put into that spreadsheet and calculated how many tonnes of carbon dioxide equivalents (see Glossary) we emitted, using a wide database of calculators and lifecycle assessments to help calculate emissions for each of our activities as accurately as possible.
In some cases, Pangolin used data from what are known as expenditure-based Input-Output databases. These determine dollars spent across an industry and carbon emissions in that industry, to come up with a per-dollar-spent emissions figure.
Pangolin also leveraged a database of life cycle assessments. These assessments involve a systematic analysis of the potential environmental impacts of a product during its entire life, including the production of raw materials, processing or manufacturing, shipping, use, and disposal. Many organisations in different parts of the world have conducted life cycle assessments on green coffee beans, for example, so we used those results in our own accounting.
One thing we recognised as we completed this step is that data is not perfect, and the method for calculating the carbon in some cases was too general. But we also recognised that when it comes to urgent action for the environment, we can’t let perfect get in the way of good. So, we have treated each assessment as an ongoing learning experience, knowing that we can take steps every year to make the data more accurate and easier to access and report on.
Step 3: Offsetting emissions
To reach a net zero output of carbon we had to remove our total emissions from the atmosphere. This is done by buying carbon credits, which are certified instruments representing an emissions reduction of one metric tonne of greenhouse gas.
There are two types of carbon credits. The first represent activities that remove or capture greenhouse gases from the atmosphere and store them in ecosystems on land or in water –for example, planting trees. The second type prevent greenhouse gases from being emitted in areas and contexts they otherwise would.
Once a carbon credit has been purchased, it can be retired, meaning it's no longer possible for this credit to be sold. Retired credits count as deductions in your own emissions, so purchasing credits to cover the total tonnes of carbon your company has emitted brings you to net zero, or carbon neutral status.
At first, we found the process of purchasing credits pretty overwhelming. One thing we hadn't known is that offsets are bought and sold on an open market, so the price of an offset is partly based on the cost of running the project, but also on market demand for those credits. The more demand for an offset, the higher the price. We also learnt that not all offsets are created equal, and there has been a lot of controversy recently about the quality of some projects – especially in Australia, where projects have been criticised for not genuinely removing carbon from the atmosphere or preventing it from being emitted, and rather just giving the appearance of doing so.
When we initially went to purchase credits we found the choice of projects quite limiting. In some cases, the projects we wanted to support had a minimum volume (that as a company we were too small to purchase); others had sold out or were prohibitively expensive. Thankfully, the Pangolin team were on hand to guide us through this process and helped us select credits that had been developed, monitored and verified under robust global standards. For the 2020/21 financial year (our first year of being carbon neutral), we purchased offsets in two renewable energy projects in India, one hydro and the other wind. These projects provide renewable energy to communities that otherwise would have relied on burning fossil fuels.
For FY21/22, we had a bit more time to plan, research and seek out projects that felt aligned with our business values and goals. We invested in four projects - the Savannah Burning project, run by Aboriginal Carbon Foundation; and Native Forest Restoration project run by Australian not-for-profit Greenfleet; an Energy Efficient Stoves project in Ethiopia; and a renewable energy Solar Power project in India.
The retirement credits for all projects purchased so far can be found in links above. We are currently in the midst of finalising our emissions audit for the financial year 2022/2023 and will soon start on our audit for 2023/2024.
Step 4: Avoid, reduce, reuse
This step is related to step 1 (the carbon assessment) and our ongoing work to reduce emissions. While we’ve been working for many years to limit our impact on the environment, the carbon audit and detailed breakdown of our emissions was illuminating. It highlighted the areas where we can make a greater impact, and helped us define and prioritise our goals and our strategy.
We were surprised to discover how much of our total emissions are in Scope 3. “When we considered ways to reduce our emissions, we immediately thought of our electricity usage,” Jason says. “In doing a carbon assessment we learned that electricity is only a small part of our emissions. We still plan to reduce our use of fossil fuel generated electricity, but it won’t impact our total emissions greatly.”
Some initiatives we have taken to reduce our emissions include:
- Installing solar panels at our roastery and head office in Brunswick East
- Diverting coffee grounds and organic waste from landfill to organic recycling
- Switching from foil-lined bags to kerb-side recyclable bags
- Reducing single-use packaging by teaming up with Returnr
- Partnering with carbon neutral suppliers (such as Minor Figures, our oat milk supplier).
- Transferring our electricity to renewable sources where possible
- Purchasing an electric van for deliveries
In addition to cutting our emissions we are also committed to improving the quality of the data we using to calculate our emissions, so that we can build an accurate and informed picture of our footprint.
The real value of a carbon assessment
Our journey to becoming carbon neutral, and our ongoing commitment to carbon neutrality, has been a lot of work, but extremely worthwhile! We have learnt so much in the process, and it has helped inform our decision-making and our environmental strategy. While not every company has the resources to hire consultants or buy carbon credits, just completing a carbon assessment will give you vital information about your business, and where you can reduce emissions and minimise your company’s impact on the environment.
For example, our carbon assessment revealed how many tonnes of carbon we emit through the services and equipment we need to run our business, so we have begun working with our upstream suppliers to reduce emissions in the future.
As Jason notes, “It’s a real privilege to own a business and choose the people we work with and how we work. With that comes a moral responsibility to do it in a way that’s right for our staff, our environment, and our communities.”
If you own or work for a small-to-medium business and you’re thinking about reducing your emissions, feel free to get in touch (you can email Jason directly at jason@marketlane.com.au).
