What UK SME businesses gain by applying to participate in See Through Carbon’s Pilot 1

What’s in it for me?

Before applying to participate in Pilot 1, even the most climate-aware small business owners should ask ​‘What’s in it for me?’ . 

The pithy, formal answer to this question is in the See Through Carbon Licence Agreement (see below for current draft). As this might be the shortest and most transparent in End User Licence Agreement history, this article expands on the Licence’s implications for Pilot participants.

Pros

Free Carbon Footprint 

Pilot participants get free, accurate, comprehensive carbon emissions reports for their business. Many free carbon calculators are available, but a) are insufficiently accurate to comply with stricter regulations, or require businesses to agree they can  monetise your data in future. Even commercial carbon auditing businesses struggle to meet the new regulations, which require accurate, comprehensive Scope 3 reporting. This is currently immune to technological solutions, because there’s no good data on which to train AI. This is one of the rationales for See Through Carbon’s database, created to meet its own Goal of speeding up carbon drawdown.

Free Regulatory Compliance

The UK is rapidly introducing mandatory carbon reporting. Despite Brexit, British regulation is largely modelled on the EU’s Green Deal (2020). The Green Deal’s array of mandatory reporting requirements, such as the Corporate Sustainability Reporting Directive (CSRD) mirrored by the UK government, end the age of voluntary self-regulation.

From the NHS to social services, local governments, schools and universities, many public bodies and the businesses serving them are joining big businesses in the list of entities now required to submit some form of Carbon Reduction Plan (CRP). 

Free Carbon Reduction Advice (Pilot Stage)

A CRP requires not just an accurate baseline carbon footprint, but also a plausible, evidence-based plan for how businesses propose reducing their emissions from that baseline. 

This kind of consultancy is best done by experts, on a bespoke, case-by-case basis, but very few small businesses can afford professional carbon consulting fees. Data submitted by participants in See Through Carbon’s Pilot stage is being 100% checked by human expert consultants, contributing their services pro bono.  

For participants in some Pilots, these experts may also provide some basic advice gratis as well, via a short ‘List of Solutions’, each with an estimated emissions reductions if implemented. This will provide the information they require to complete their CRP.

Please note this ‘List of Solutions’ is a beta service for the Pilot phase only, and will only be available in a limited number to small businesses who can’t otherwise afford professional consultant fees. 

See Through Carbon is testing the value of this bonus service to investigate whether its List of Solutions might usefully be used to train an AI to automatically suggest free, good-enough, better-than-nothing advice in future, or detect carbon-reducing patterns invisible to human experts.

Data Security

Any entity collecting data for any reason must:

• Legally comply with consumer-protection regulation like the EU’s General Data Protection Regulation (2018) (GDPR), or its UK mirror regulation, the Data Protection Act (2018).
• Take reasonable measures to protect their users’ personal and financial data against bad actors/hackers.
• Only use user data in a way that conforms to their End Use Licence Agreement.

Commercial data collectors have additional commercial incentives. Businesses that exchange ‘free’ services for data, like Google or Facebook, need to keep this data secure behind a paywall in order to profit from it. Businesses that charge for their services need their customers to be confident their bank details won’t be hacked. 

Ecosystems like See Through Carbon must all comply with legal provisions like the GDPR, but the burden is greatly reduced because See Through Carbon:

• collects no personal information
• collects no financial information or bank details
• only collects data related to accurate emissions calculation.
• makes carbon-related information publicly accessible by default.

Please note the only information it collects but doesn’t make public by default is commercially sensitive information, i.e. lists of customers and suppliers. 

Such lists are of course only semi-confidential, as they can be easily deduced from public sources, but See Through Carbon needs this information in order to automatically, efficiently and authoritatively calculate Scope 3 emissions for complex supply chains. 

See Through Carbon only reveals this data to regulatory authorities at the request of the user in the event of a regulator requesting evidence during an audit. It does not reveal such information to other users.

Cons

Public Carbon Data

In return for these free services, Pilot participants agree to their carbon-related data being publicly accessible, in the same way that annual financial statements are publicly visible at Companies House. 

See Through Carbon’s licence agreement is short because it is an ecosystem, not a business. Commercial entities need long licence agreements because, as profit-making businesses with a duty to deliver shareholder value, they need to:

• Collect as much data as the user and regulator permits
• Hide data behind database paywalls in order to charge clients to access it
• Conceal their methodologies in ‘black boxes’ in order to protect their Intellectual Property (IP)

As an ecosystem, See Through Carbon has no such constraints, because it:

• Only collects carbon-related data
• Makes the data public by default
• Publishes its methodology transparently by default

NB: making your carbon footprint public is only a ‘con’ if your business currently claims to be ‘carbon neutral’, based on voluntary reporting standards which ignore Scope 3 and use carbon credits to ‘offset’ what Scope 1 and 2 emissions they report.

New mandatory regulation requires accurate and comprehensive reporting of Scope 3 emissions, as a baseline for companies taking direct responsibility for reducing their own emissions. Whether regulators will continue to allow these emissions to be ‘offset’ by paying distant people in poor countries to plant trees’ is unclear.

For businesses that do not currently use commercial voluntary-era self-regulation services to claim to be ‘carbon neutral’, this is a non-issue.   

What if my carbon footprint turns out to be huge?

For carbon reporting purposes, a business’s absolute emissions volume is not significant. UK and EU regulation is focused on relative emissions reduction. 

This is reasonable, as different sizes and types of business make the absolute number meaningless on its own:

• Scale: A business with 249 employees will naturally produce more emissions than a business with 1 employee
• Sector: A business that deals in energy-intensive goods, like construction, will naturally generate more emissions than a similar-size business in a low-carbon sector, like fruit farming.  

The new regulations require businesses to verifiably and accurately demonstrate they have a strategy to reduce their emissions’ relative number year-on-year. 

Specifically, the UK’s ‘Carbon Reduction Plans’ (CRPs) require companies to prove they:

• Are accurately reporting their emissions now (carbon footprint baseline)
• Have credible plans to reduce them in the future (carbon reduction solutions)

This enables Britain to convincingly and verifiably demonstrate adherence to its international carbon reduction commitments, something in which it aspires to be a world leader and role model.

Thus, new reporting regulations reward accurate business reporting in order to establish a reliable baseline to prove future reduction relative to that baseline. 

They do not punish businesses with a ‘carbon tax’ penalty linked to the absolute emissions volume.

Indeed, the bigger a business’s baseline footprint, the greater its potential to demonstrate absolute reduction. 

The rule of thumb is that unless a business is currently publishing its carbon footprint and claiming it’s tiny/non-existent, it has nothing to fear from starting to report it accurately now.

Even more simply put, if you don’t know your carbon footprint, the sooner you start accurately measuring it, the sooner you’ll be able to start proving you’re reducing it.

How long will it take me to provide the data?

This will vary from business to business, depending on such factors as size, nature of business, complexity of supply chain, and administrative efficiency.

In general, completing See Through Carbon’s data collection form is much less onerous than first-time carbon reporters fear. It is nowhere near as time-consuming or onerous as, say, a financial tax return. 

One pioneering Pilot 4 participant, for example, a UK home care chain with 5 branches, around 60 full-time, and 40 part-time staff, completed the initial form (currently an Excel spreadsheet for the Pilot) in ‘around a hour’.

Follow-up questions from our expert accountants, took another hour or so in total, but See Through Carbon expects this to diminish in time, as more of these queries are incorporated into the initial Excel questionnaire. 

Will I qualify for free ‘List of Solutions’ carbon consultancy too?

As Pilot 1 is specifically targeted at SMEs, any Participants accepted are very likely to qualify on the basis that they couldn’t reasonably afford professional consultancy fees.

See Through Carbon:

• Guarantees it will publish a free carbon footprint for any Participant it accepts, to the standards described on its website, as quickly as human resources permit.
• Will endeavour to provide a ‘List of Solutions’ for as many Pilot 1 participants as possible, as we want to test how useful this service is.
• Will endeavour to provide advice with as great a degree of specificity as our pool of human expert pro bono consultants have the capacity to provide gratis.
• May publish Participants’ carbon footprints before adding their List of Solutions, as this takes longer to generate.

How ‘official’ is See Through Carbon’s footprint and consultancy?

Mandatory carbon reporting is at such an early and primitive stage, any claims of being ‘official’, ‘accredited’ or ‘certified’ carry little weight.

See Through Carbon provides Pilot participants with a free service, and may even include packaging the information in a format suitable for particular entities, like the NHS, Ministry of Education, local authorities, CSRD, CBAM etc.

As with submitting returns to HMRC, however, ultimate responsibility for compliance lies with the user.  See Through Carbon publishes its data and methodology in great detail, in order to educate Pilot participants as thoroughly as possible, so they understand as fully as they wish to, the details of their submissions to any regulator.

See Through Carbon does not offer an ‘audited’ service, in the sense it does not demand any documentary evidence to support any values submitted. This would be far too onerous, and unnecessary, for both Pilot participant and See Through Carbon.

Our Licence Agreement requires Pilot participants to agree that the data they submit is ‘honest and accurate’. Our human experts’ queries will only relate to checking for omissions or outliers that might suggest innocent mistakes, such as an incorrect unit or misplaced decimal point.

What See Through Carbon Is, and Isn’t

See Through Carbon recommends Pilot applicants understand its ‘business model’ before applying. 

This website, in particular the Ecosystem solution and Ecosystems vs Species articles, provides detailed explanations of how See Through Carbon differs from commercial carbon standards, consultancies and free-to-use carbon calculators.

In brief, See Through Carbon is similar to commercial carbon accounting services, in the sense that it helps businesses comply with increasingly stringent carbon reporting regulations by calculating their carbon footprint. 

Unlike commercial services or ‘data play’ free services, however, See Through Carbon makes its data public by default, and publishes its methodologies in full, in service of the See Through network’s overall goal of ‘Speeding Up Carbon Drawdown by Helping the Inactive Become Active’.

Commercial carbon reporting services’ business model requires them to keep their data behind paywalls, and protect their methodological IP. That’s how they make their money.

Ecosystems like See Through Carbon facilitate carbon reduction for all stakeholders, including commercial carbon reporting services, regulators, researchers and businesses. By providing a public database of accurate, consistently measured carbon footprint information. 

See Through Carbon’s public database is designed not to compete with commercial services, but to enable anyone who wants to reduce their carbon footprint, from businesses seeking to comply with new regulations to researchers searching for the shortest path to sustainability, to make better, evidence-based decisions to speed up carbon drawdown.

*

Draft See Through Carbon End User Licence Agreement  

This is a licence agreement between:

See Through Carbon, Company No. 15071441 registered in England & Wales (‘The Licensor’)

and 

You, as an individual or the organisation on whose behalf you are acting (‘The Licensee’)

Licensee agrees:

1. FEE: You will not pay the Licensor any fee (though you may donate services in kind to support them).
2. GOOD FAITH: The data you provide in perpetuity to the Licensor will be honest and accurate.
3. LIABILITY: You are responsible for any carbon report you submit to regulatory authorities.

Licensor agrees:

1. SERVICES: We will provide carbon footprint measuring services as specified on our website when delivered.
2. DATA PROTECTION: We will only collect data pertaining to carbon reporting
3. MONETISATION: We will never sell any of your data.
4. CONFIDENTIALITY: We will only disclose information we label ‘commercially sensitive’ to a regulatory auditor if requested.
5. TRANSPARENCY: We will make all your other data available via our public database.