Carbon Accounting

Carbon emissions accounting has become an activity of international importance, as it is the means by which nations' compliance with the Kyoto Protocol (an international treaty) is documented. The treaty has now catalyzed markets in carbon offsets, which also include buyers and sellers not bound by the Protocol. Hence the importance of energy analysts trained in carbon accounting. This page gives a brief background on the Kyoto Protocol and carbon emissions trading, including links for further study. The actual carbon emissions accounting is described in Steps 1 and 2 of Fossil Fuel Footprinting.

The Kyoto Protocol and beyond

Global recognition of the serious implications of anthropogenic climate change has increased resolve to address the problem. While the United Nations Framework Convention on Climate Change, developed at the 1992 Conference on Environment and Development held in Rio de Janeiro, proposed only voluntary controls of greenhouse gas emissions, its 1997 amendment, the Kyoto Protocol, established mandatory emissions reductions for participating nations. The agreement came into force only in 2005 when Russia ratified. By agreement the treaty did not come into force until there were enough ratifiers to constitute at least 55% of 1990 emissions by Annex 1 countries (those developed countries who signed the protocol in 1997).

A major cause of the long delay in meeting the ratification requirements was due to the United States not ratifying. The US is the largest emitter of CO₂. With only 5% of the world's population the US emits about a quarter of the CO₂, and a considerably larger share of the emissions of Annex 1 countries, given that China and India, the world's next largest emitters are not part of Annex 1. Although the US signed the Kyoto Protocol under the Clinton Administration, the Bush administration refused to submit the Protocol to the Senate for ratification, effectively blocking US participation. Internal frustration and concerns over lack of US participation has, however, lead to actions at the state level, for example California's Global Warming Solutions Act of 2006.

Carbon Emissions Trading

One means to satisfy Kyoto emissions reductions obligations is to acquire emissions offsets through emissions trading (Kyoto Protocol Article 17). The idea is that those who can reduce emissions below their own targets at lower cost can sell their emissions reductions to others for whom emissions reductions are more costly, thereby reducing the overall cost of emissions reductions. Pollution trading was pioneered very successfully in the US for sulfur emissions reductions from power plants and is now widely used for other air pollutants as well. Carbon emissions markets in which carbon offsets are traded, have emerged as a major mechanism to stimulate, acquire, and document reductions in carbon dioxide emissions, which are responsible for about 60% of the total greenhouse effect. These drivers have created a great demand for carbon emissions accounting and carbon mitigation approaches.

Carbon Accounting

Carbon accounting is the process by which CO₂ emissions from fossil fuel combustion are calculated. This two step process is described in the links below. Means to mitigate carbon emissions are discussed in a separate section.

Step 1

Determining the amount of fossil fuel used per year

Step 2

Calculating the associated carbon emissions per year