What is Return on Carbon?

Companies are widely encouraged to reduce their carbon footprint. To achieve this, they can rely on a valuable indicator: the return on carbon.

Greenhouse gases: everything you need to know about the concept of carbon return

Can we reduce our carbon footprint and save money at the same time? Behind this vast question lies the often misunderstood notion of carbon return. So what is this indicator? Why use it? Who can use it? We take stock.

What is return on carbon?

Carbon payback is the measurement of the effectiveness of actions taken to reduce greenhouse gases (GHGs). To calculate it, two factors need to be taken into account:

• the economic investment made (cost of photovoltaic panel installation, maintenance, bills, etc.);

• changes in direct and indirect greenhouse gas emissions.

Clearly, a positive return on carbon implies a favorable return on investment, as well as a reduction in GHG emissions.

What’s the difference between return and carbon footprint?

The concepts of carbon footprint and carbon return are similar. There are, however, some notable differences.

In fact, the carbon footprint is defined as the measurement of all the GHG emissions for all the physical flows of a structure, without which its proper functioning would be impossible. It is therefore a quantified statement of an entity’s overall environmental impact.

Return on carbon, on the other hand, measures the efficiency and financial profitability of an action carried out in favor of the environment. In this respect, it is a more specific indicator, but also more relevant for a company seeking to accurately assess the impact of an investment.

ROE and ROCE: other indicators close to the notion of return on carbon

ROE (return on environment) is a concept found mainly on the other side of the Atlantic. It is based on a rather simple observation: acting in favor of the environment is synonymous with multiple benefits:

• increasing the attractiveness of companies for recruiting young, qualified staff concerned by environmental issues;
• improved image with consumers by highlighting the eco-responsible actions developed by the company;
• increased profitability thanks to sustainable investment (short circuits, reduced energy bills, etc.).

For its part, ROCE (return on climate and the environment) is a concept in line with its namesake (return on capital employed), widely used by finance professionals. It highlights the fact that, contrary to popular belief, a company whose primary objective is growth is subject to a lower return on investment than one that has invested in resolving societal and environmental issues.

Return on carbon: who uses this indicator?

This indicator is mainly used by structures producing a significant volume of direct and indirect greenhouse gas emissions, and seeking to reduce them. In this respect, supermarkets are perfect examples. They produce large quantities of GHGs on a daily basis (refrigeration, air conditioning, transport of goods, etc.).

To improve their carbon footprint, several solutions can be considered:

• installation of solar panels ;
• green roofs ;
• installation of a new fleet of refrigeration plants;
• installation of a refrigerant leak detection system ;
• lower air-conditioning temperature ;
• closing cold cabinets ;
• etc.

To measure the economic and ecological relevance of an investment of this scale, the notion of return on carbon takes on its full meaning.

Greenhouse gas emissions: why is carbon footprint a relevant indicator?

At a time when companies are being urged to take action to reduce their GHG emissions, it is essential to be able to accurately estimate the financial costs involved. In this respect, the notions of return on carbon and return on investment are intimately linked.

It’s one thing to spend 200,000 euros on eco-responsible equipment. It’s quite another for the operation to pay for itself after 20 years, with little environmental benefit. Simply put, the return on carbon is an indicator designed to dispel any doubts about the viability of such substantial financing.

Refrigeration and return on carbon: what solutions to consider?

Companies running refrigeration plants generate direct and indirect greenhouse gas emissions on a daily basis. Various solutions can be implemented to reduce these emissions.

Minimizing your carbon footprint through eco-efficiency

Eco-efficiency in refrigeration is an approach that aims to reduce the environmental impact of refrigeration installations, while maximizing their economic efficiency.

Broadly speaking, there are four main areas of intervention:

• 1 – Choice of refrigerants: use low global warming potential (GWP) refrigerants, such as 4th generation refrigerants (HFO), rather than synthetic refrigerants like hydrofluorocarbons (HFC).

• 2 – Plant design: use innovative technologies such as variable-speed compressors, high-efficiency heat exchangers or electronic control systems.

• 3 – Awareness-raising and training: support employees in implementing eco-efficient practices, while training them in the proper management of refrigeration facilities.

• 4 – Plant maintenance and management: regular monitoring of refrigeration plants to optimize their energy efficiency and minimize the risk of leaks.

Find out more about the eco-efficiency concept: here

Greenhouse gas reduction and return on investment: the importance of monitoring your refrigeration plant fleet

Refrigeration is the biggest source of greenhouse gas emissions for supermarkets. To reduce these emissions, many are opting for fluids with low GWP (global warming potential). While this is a viable solution, it remains incomplete.

In fact, the majority of GHG emissions come from faulty equipment. It is therefore imperative to ensure continuous monitoring of your refrigeration installations, so as to be alerted as soon as a leak occurs. With this in mind, leveraging IoT tools and data is an effective way to monitor consumption, while optimizing energy performance. What’s more, the data collected can be used to calculate the precise return on carbon generated by your investment.

To help you in this task, Matelex offers a complete, easily deployable solution. It is built around three tools:

• the DNI (intelligent level detector), which uses an indirect detection method to prevent leaks at an early stage;
• the energy module, which measures a plant’s actual consumption in order to provide an alert in the event of energy drift (overconsumption) or risk of compressor failure;
• PolarVisor, an interface for centralized remote monitoring and real-time data collection to optimize plant performance.

For plant owners and refrigeration professionals, the benefits are not only immediate, but also, and above all, measurable. Much more than a simple leak detector, the Matelex solution helps to considerably reduce leaks and energy bills – and by extension – direct and indirect greenhouse gas emissions.

It’s also worth noting that installing the Matelex solution involves no change to the existing fleet of refrigeration systems. It is suitable for all refrigerants, whether for new or existing installations. However, the latter must be equipped with an HP liquid receiver to accommodate the solution.

In this way, we can say that the return on carbon is a reliable, relevant indicator that is becoming increasingly popular, particularly with the mass retail sector. In this sector, which is increasingly concerned by environmental issues, it is a preferred evaluation tool for quantifying and rationalizing the eco-responsible investments to be made.