ESG in construction: Improving CO2 emission reporting

By Kristoffer Dubois, Trackunit
Trackunit’s Kristoffer Dubois discusses the urgent need for improved ESG reporting standards in regulating CO2 emissions in the construction industry

Standardising emissions reporting may be difficult, but if we really want construction to be better, live-data tracking is the next big step. It’s the only way to put an end to the guessing game.

It’s probably crossed your mind more than once if it’s really worth the effort. We do it because we care and we want to create that sense of being part of something positive. Moreover, it’s in aid of an overall contribution that can make a mark on the macro environment.

COP27: Record-high CO2 emissions

That’s kind of where we are with construction. Many of us are taking steps in our daily working lives that are making small differences. Tracking this. Streamlining processes there. Utilising human resources better. And connecting up job sites for more effective fleet management.

Yet when it comes to emissions reporting, we’ve also allowed a practice to develop where, because it’s based on inadequate data, companies can publish estimated numbers that, at best, might be considered good marketing and at worst, are misleading. This process undermines the collective effort, harms the industry and can only be put right by implementing live tracking for emissions data.

Last year’s COP27 climate talks included a dispiriting UN report on construction that showed the industry had rebounded from the COVID-19 pandemic to post record highs in energy consumption and CO2 emissions at 34% and 37% respectively. And those figures – approximately 2% above 2019 levels – came despite significant energy efficiency investments and concerted efforts to lower energy intensity.

First, we have to acknowledge that the practice of reporting numbers in favourable terms has developed because emissions tracking and reporting standards in our industry are immature and are, in comparison with gathering on-road data, difficult to do. However progress is being made on the legislative side and, while there are as of yet no rigorous standards for calculating emissions, these legislative steps are critical to the shift in behaviour. 

The United States has, for example, been making significant strides in implementing regulations to reduce CO2 emissions from the transportation sector. The country has implemented fuel economy standards for passenger cars and light-duty trucks and has set targets for reducing emissions from heavy-duty vehicles. The current US administration also announced plans to reduce the country's greenhouse gas emissions (GHG) by 50-52% by 2030 compared to 2005 levels. 

EU to be climate-neutral by 2050

At the federal level, things are happening too. California has set a target of reducing GHG by 40% below 1990 levels by 2030, with a goal of achieving carbon neutrality by 2045. Further, it has in the last month tightened legislation on electric equipment that requires fleets to report on the actual energy usage of machines, rather than estimating usage. Other states, such as New York, Massachusetts, and Illinois, have also introduced their own emissions reduction targets.

The European Union has also been highly active in implementing regulatory requirements. The European Commission's European Green Deal aims to make the EU climate-neutral by 2050, with a 55% reduction in GHG emissions by 2030. As part of this initiative, the EU has introduced the Construction Products Regulation, which requires the construction industry to assess the environmental performance of its products, including their CO2 emissions.

Elsewhere, international organisations like the World Green Building Council are working to promote sustainable construction practices globally. The WGBC's Advancing Net Zero initiative aims for all buildings to halve “emissions of the building and construction sector by 2030 and the total decarbonisation of the sector by 2050,” and it provides resources and guidance for companies looking to reduce their carbon footprint. 

Driving sustainable outcomes

The regulatory environment is becoming more established and is underpinned by a societal sentiment that is more or less in harmony with those goals. When that happens, the criteria to be part of government-, state- or regional-funded projects become ever more stringent in line with macro targets that enjoy broad support through society.

Furthermore, that places a premium on bidders being able to demonstrate they really are compliant when it comes to demonstrating their record on emissions. It is, in effect, the perfect marriage of business sense and an environmentally aware strategy that encourages better behaviour and better outcomes.

Data-driven breakthroughs

We are already living in an incredibly data-rich environment that has taken huge strides in the last few years with the advances in IoT and the deepening connectivity between machines, people and processes.

The next breakthrough in delivering data that really differentiates fleet owners at the micro-level is upon us. There are exciting advances happening that will make emissions reporting more quantifiable, more rigorous and, perhaps most significantly for the bottom line, aligned with the kind of stringent criteria that will enable them to successfully bid for lucrative, environmentally-sustainable contracts.

Every machine on every job site is getting closer to being connected. It will soon be possible to take a data-driven approach to generate highly accurate CO2 emissions reporting based on real data for every asset, even without access to highly detailed utilisation datasets. 

Future-proofing CO2 reporting

Establishing rigorous reporting standards will take collaboration between governments and private organisations, with trailblazers showing the way. 

To get ahead of both the legislation and the competition, it is crucial for construction machine fleet owners to start implementing detailed reporting standards based on real machine utilisation data and local power mix profiles for electrical equipment. This will require some effort and resources, but it is a necessary step in ensuring sustainable development in the construction industry.

Increasingly, major industry players are relying on state-of-the-art telematics providers with the sophistication to handle the highly complex modelling of individual machine profiles to provide a scalable and future-proof CO2 reporting setup. By being proactive and staying ahead of regulations, companies can reduce their emissions, save money, and contribute to a sustainable future.

While progress is being made in regulating CO2 emissions in the construction industry, there is still a long way to go in establishing rigorous reporting standards. However, through collaboration between governments, businesses, and initiatives like the Advancing Net Zero campaign, the shift towards a more sustainable construction industry will continue to gather momentum.

Live tracking of emissions will enable us to get there. And getting there is about pulling together.

About Trackunit

Global IoT services provider Trackunit connects construction through one platform to create a living, evolving ecosystem that delivers data and insights to the off-highway sector. With 1.25 million assets and counting connected, it uses technology to eliminate downtime, improve safety, and help customers improve the bottom line in a sustainable, cost-effective way.

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