Carbon accounting is a technique by which States’ compliance or conformity with the Kyoto Protocol is recorded or documented. It is the process of accounting pursued to determine the amount of carbon (IV) oxide equivalents which will not be emitted into the atmosphere due to Flexible Mechanisms schemes or projects within the Kyoto Protocol (Williams, 2010). Carbon emissions trading, is an example of a scheme adopted by many nations for improvements within environment. It allows members to purchase and sell permits or sanctions for carbon dioxide emissions or credits for cutback in emissions of greenhouse gases (Hurteau, Koch & Hungate, 2008, p. 498).
Carbon accounting is of value as it allows assessment of industries’ carbon footprint cutback approaches against other sustainable business approaches for the companies. Carbon accountings by companies help in the identification of opportunities for cost cutback as well as benefits for enhancements in processes and waste reduction (Hurteau, Koch & Hungate, 2008, p. 493). Carbon accountings are the initial steps of companies towards carbon neutrality.
The most gain companies can achieve by implementing carbon accounting is that, they are able to position themselves within regulatory curve (Williams, 2010). The introduction of caps on carbon dioxide output or carbon taxes can help in the determination of industries’ baseline, which is significant in working out measures that should be undertaken to cutback carbon output.
It is necessary to implement laws mandating carbon accounting; because with such laws it is feasible for industries to be assessed fees depending on what discharges are for, their firms or other structures. Moreover, firms that recognize their baseline can easily forecast the fiscal consequences or penalties, consequently, be able to position themselves to become competitive within a carbon controlled marketplace.
References
Hurteau, M. D., Koch, G. W., & Hungate, B. A. (2008). Carbon Protection And Fire Risk Reduction: Toward A Full Accounting Of Forest Carbon Offsets. Frontiers in Ecology and the Environment, 6(9), 493-498.
Williams, R. J. (2010). Carbon accounting, land management, science and policy uncertainty in Australian savanna landscapes. Collingwood, Vic.: CSIRO Publishing.
