Britain should create a dedicated carbon reporting office to cut red tape, clean up messy emissions data and help businesses compete in low carbon markets, according to Energy Systems Catapult.
The organisation is calling for a new Carbon Reporting and Innovation Office to be set up inside the Financial Reporting Council, warning the current system is fragmented, costly and holding back investment.
The proposed office would professionalise the carbon accounting and assurance sector, helping improve quality, value for money and trust in the services businesses are paying for.
Carbon accounting is fast becoming part of the plumbing of the modern economy, investors, customers and regulators increasingly want proof that a product, process or service has lower emissions.
But businesses are currently having to navigate a confusing mix of voluntary schemes, sector-specific rules and competing methodologies.
Energy Systems Catapult says that is leaving firms, from SMEs to heavy industry, spending too much time and money building internal data systems or hiring consultants to understand what they need to report.
That is money and resource that could otherwise be used to grow, innovate and develop new low carbon products.
Emily Ford, Senior Energy Policy Advisor at Energy Systems Catapult, said: “We’re calling on government to establish a dedicated Carbon Reporting and Innovation Office to cut through this complexity, unleash innovation and lay the foundations for a world-leading carbon accounting industry.”
The organisation argues that better emissions data would not just help businesses. It would also help government design better policy, support innovation and make schemes such as the incoming Carbon Border Adjustment Mechanism work properly.
That mechanism will depend on accurate carbon accounting if it is to protect UK companies from higher-carbon imports and reduce the risk of carbon leakage.
The organisation would also work towards more comparable emissions data across the economy, making it easier for customers and investors to judge competing products and services.
A key part of the plan is a digitally distributed data exchange, designed to create a single point of disclosure for emissions data.
That could reduce administrative costs for companies preparing data and for those using it, including investors, customers and government.
Energy Systems Catapult estimates the office could be operational within 12 to 18 months, employing 30 to 50 staff. It would require an annual budget of £2m to £5m, eventually funded by a levy on the carbon accounting sector.
Dr Danial Sturge, Carbon Policy Practice Manager at Energy Systems Catapult, said the office would help cut business admin costs while making emissions data “transparent, comparable, and decision-ready”.
He added: “SMEs with high growth potential are increasingly being asked to provide emissions data to access markets.”
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