Originally outlined in the 2009 Grenelle 2 bill, the GHG reporting law requires companies with more than 500 employees to disclose their carbon footprint and outline emission reduction measures by 31 December 2012. The new piece of legislation will support France’s long-term goal of achieving a 75% reduction in GHG emissions below 1990 levels by 2050.
In the coming months a national coordination centre will be set-up to develop reporting methodologies, calculation tools and outline how the information in the carbon reports is to be presented.
Details of the carbon reporting decree
The legislation stipulates the need for annual carbon reports and these must be accompanied by a 3-year action plan outlining emissions reduction strategies. In addition to the stipulation regarding organisations with over 500 employees, overseas organisations with over 250 employees will also have to give details of their carbon footprint.
In their accounting organisations must take into account both the emissions directly linked to their activities and the indirect emissions linked to electricity use, heating and cooling.
Whilst up until now the development of climate-energy plans (PCT) was voluntary, the new law mandates that the French State and all local authorities with over 50,000 inhabitants must now introduce such a plans. These plans are to be submitted to the appropriate regional authority for approval and once accepted made public.
Those organisations and local authorities that have already reported their carbon emissions in the previous 3 years need not repeat the exercise, and can submit their previous footprint reports instead.
French companies rank poorly in ET Carbon Rankings Report
Although many groups have welcomed mandatory reporting there are nevertheless critics who believe the carbon reporting should have had a broader scope, and does not live-up to the overall ambitions of the Grenelle project. Currently the law requires the provision of figures for Scope 1 and part of Scope 2, but does not stipulate the integration of Scope 3 figures.
A 2011 report by the Environmental Investment Organisation (EIO) indicates that French and Swiss companies rank amongst the worst when it comes to reporting their GHG emissions. According to the report only 62% of French companies provide complete GHG emissions data, compared with 92% of Spanish companies, 83 % of German companies and 78% of British companies. Among those French companies that do not disclose any data are Sodexo, Cap Gemini SA and Bouygues.
The Grenelle Environment Project is a consultative project between the government, local authorities, trade unions, business and voluntary sectors to develop a roadmap for sustainable development and ecosystem protection in France. Launched on 6 July 2007 the aim of the Grenelle is to draw up concrete measures to tackle environmental issues.
To improve transparency and provide adaptability for different types of organisation and different types of climate, direct and indirect emissions for carbon reporting have been categorised into three scopes: Scope 1, Scope 2 and Scope 3. These scopes can be used to track GHG emissions from heating, ventilation, air conditioning and refrigeration (HVAC&R) systems.
Refrigeration and air conditioning system refrigerant gas leaks are classified as direct emissions and come under Scope 1. Emissions from the electricity generated to power refrigeration and air conditioning systems are classified as indirect and fall under Scope 2. Emissions from the use of goods or services manufactured or provided by remote vendors are also considered indirect and fall under Scope 3.
The Environmental Investment Organisation is an independent non-profit body whose mission is to improve the environmental ‘output’ of the financial system.