After nearly half a year, every year, collecting and calculating carbon emissions data on spread sheets, Salesforce.com’s climate team was fed up. So in 2017 they built an app to crunch the numbers – and now they sell it for $4,000 (roughly Rs.
As global companies prepare pledges to help stop climate change, the first problem they face is quantifying their emissions. The other is understanding whether their solutions work.
Carbon accounting software needs to be boomed by large companies like Salesforce and startups, along with some skepticism about some parts of the process.
Microsoft Microsoft is previewing a tool for calculating emissions called the Cloud for Sustainability, with the goal of making it available by the middle of 2022.
On Thursday, Arizona-based carbon accounting startup Persephony said it raised more than $100 million (about Rs 750 crore), the largest ever venture capital funding in the sector.
According to a Reuters review of data from Pitchbook and Climate Tech VC, this year saw nearly $300 million in total fundraising (about Rs 2,250 crore), more than six times the total for 2020 and 21 times the money raised in 2019.
Carbon accounting is complicated, especially when emissions beyond a company’s direct control, such as the suppliers and products used, are what many companies are trying to do. For example, how does an automaker account for the steel it buys and the miles driven by its customers? Some in the accounting business call these indirect emissions, often the bulk of a firm’s emissions, the “Pandora’s Box” of carbon accounting.
“You have a big problem in our world of companies creating their own methodologies and then black-boxing them. They are not auditable. In the worst cases, they are helping companies to greenwash,” said Kentaro Kawamori, CEO of Persefony, which uses a system called the Greenhouse Gas Protocol that calculates numbers to be added to total emissions.
Some argue that accounting is not always worth the effort and dilutes the focus.
The Science-Based Targets Initiative, a non-profit that helps companies set emissions targets, does not encourage smaller companies to produce emissions beyond the company’s direct control, for example, even if it is indirect. Builds “net zero” program with a strong focus on emissions
Snowcap, a new climate tech venture capital firm, don’t think Startups should be asked to measure their environmental impact, especially if their technology is designed to fundamentally change an industry, such as making lab-grown meat.
Taylor Francis, co-founder of carbon accounting software startup Watershed, created as fintech firm Stripe tracks its own emissions data, hopes customers will use the tool to make decisions about suppliers and emissions.
“If this whole place is just about revealing and publishing a sustainability report once a year, I think that will fall short of what we need to really beat climate change.”
© Thomson Reuters 2021