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Smaller carbon footprints save money and satisfy customers

August 1st, 2008 / By: / Sustainability

Should you measure your carbon footprint and try to reduce it?

Green ink print of a left foot

This isn’t about a sooty trail around the office. It’s about how much carbon dioxide your company pumps into the atmosphere as a result of its electricity consumption, motor vehicle fuel use and other business daily goings-on.

Whatever your opinion about global warming, reducing your firm’s output of carbon dioxide can mean lower costs—reason enough for any business to pay attention. Equally important, some if not all of your customers will see your reduction in carbon output as simply doing the right thing.

“I think there’s a strong dose of both altruism and business sense to becoming involved in this,” says Russell Simon, communications manager with Carbonfund.org of Silver Spring, Md., a nonprofit organization that helps businesses track and reduce output of carbon dioxide.

CO2 and other so-called greenhouse gases trap heat near the surface of the earth, warming the planet and accelerating climate change, according to scientists. Results could be rough for life as we know it: changing weather patterns, higher ocean levels, spreading of disease, reduced agricultural output, shortages of potable water, ever-higher food prices.

Larger U.S.-based companies are already voluntarily signing up to meet target reductions. Doing so may be a good idea for smaller businesses as well. Ideally, reduced carbon output means reduced energy use. You’ll operate more efficiently, you may impress your customers … and you might be better prepared for the limits that Washington is expected (eventually) to impose.

Companies investigate ways to reduce carbon footprints

Basically, measuring your carbon output means analyzing your energy use and finding ways to reduce it. That’s not all, however.

What’s the hard part? “I think the real answer most times goes to the heart of small businesses, and that is they don’t have time,” says Jerry Lawson, national manager of the U.S. Environmental Protection Agency’s Energy Star product certification for energy efficiency (energystar.gov/smallbiz).

Shrinking your carbon output can be as simple as swapping incandescent light bulbs for more energy-efficient fluorescent bulbs, or piggybacking more customer visits so you can take one less flight. Flying one employee from New York to Los Angeles for a business meeting pumps nearly a ton of CO2 into the atmosphere, says Carbonfund.org. You’ve also probably noticed that it costs you a lot of money these days.

So you may already have considered teleconferencing equipment, if you’re in a position to acquire it. “It pays off pretty quickly for businesses that do a fair amount of travel,” says Meredith D. West, assistant administrator for policy and strategic planning at the U.S. Small Business Administration (SBA).

If you’re going to buy new energy-efficient equipment, 2008 may be the year for it. This year only, under the Economic Stimulus Act of 2008, you can write off up to $250,000, twice the earlier limit. Moreover, a special depreciation allowance lets you write off 50 percent of what you paid for it. In addition, you can take a write-off of the normal first-year depreciation on the the other 50 percent of what you paid for the property.

You’ve probably also heard about the prospect of selling carbon credits on the Chicago Climate Exchange or another such bourse. Some organizations, by lowering their own carbon output sufficiently, can generate enough carbon offset to sell “carbon credits” and make a few bucks.

Big companies such as electric utilities have voluntarily pledged to reduce their own output by a targeted amount, and if they miss the target, they are obliged under their agreement with the exchange to buy carbon credits from other outfits that hit their targets.

This trading system may help reduce carbon output globally, but it’s probably not a good option for small business yet; there’s too much work for busy managers and not enough return.

EPA’s Lawson, however, hopes that carbon-credit aggregators will emerge for small businesses—perhaps through trade associations. Such aggregators would help small businesses cut energy costs up front, reducing carbon footprints, realizing immediate savings and perhaps even gaining some revenue from aggregators’ sales of carbon credits.

Don’t hold your breath, though. Maybe eventually you can make a little money off your outlays to cut CO2 emissions, but it could be a while. “I would like to see the small businesses recover that,” says EPA’s Lawson, “but it’s not clear to any of us how they’re going to do that, or whether the market will care.”

Customers care about going green

You want publicity? Going carbon-neutral might put you in the local paper. CarbonFund.org says companies with fewer than 10 employees typically account for 77 tons of carbon-dioxide emissions per year. That’s a lot of gas, and with a little effort you should be able to cut a few tons. Sustainability matters to the public, and newspapers, magazines and even local television stations are more willing to listen these days if you go to them with your story.

Whether or not the media come around, your customers count, and your customers may be expecting you to turn green. So goes the discussion at Eide Industries Inc., a Cerritos, Calif., maker of custom awnings and canopies. Carbon reduction is “definitely on the radar screen” at his company, says vice president Joe Belli. “It’s obviously a very important marketing tool,” he adds. “It is going to matter to our customers.”

Why wait? “It will probably raise prices,” says Belli, “which would make us less competitive right now.”

How so? Less energy use, less cost, less carbon output—that much works. To be good carbon cops, however, industrial-fabric manufacturers may have to take into account the carbon in their products as well. What will they have to pay to recycle all those awnings and canopies rather than merely putting them in the trash? Belli says the cost of separating recyclable from nonrecylable material in such fabrics is unknown at this point.

He anticipates that at some point either customer pressure or government regulation will cause the industry to start tracking carbon. However, “quite frankly,” says Belli, “I don’t know if we’re backed into that corner yet.”

Marc Hequet is a business writer based in St. Paul, Minn.

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