The Renewable Energy II Directive (so-called RED II directive) guides the legislation in member states into a more environmentally conscious direction from 2021.
In the past, making profit in the industrial sector has not prioritized ecological thinking. However, times have changed. Environmental consciousness and goals to be more responsible are visible everywhere in society. This year, Earth Overshoot Day happened on August 22 2020 and emphasised how limited this globe’s resources are. This is something that affects all of us.
Long-term environmental work is important for the whole humankind but being environmentally conscious can benefit companies even in the short term. Efficient use of resources contributes to direct savings on costs. In addition, environmental certificates and creating good environmental practices help build a positive image of responsible operations for customers and stakeholders and helps companies stand out in tender competitions.
However, receiving certificates and upkeeping systems require reporting which is a whole topic in itself. In this blog post, I will talk a little about sustainability reporting which can be so much more than filling time-consuming sheets on Excel. Many handy tools are available, such as Once by Pinja, a material flow management and reporting system for energy and circular economy companies. Read how Gasum, the leading Nordic producer of biogas started using the Once system in their material flow management and sustainability reporting.
Not just carrots - EU directives are sticks to help the environment
Environmental consciousness is getting better not only through certificate carrots but also through sticks in the form of EU directives. The Renewable Energy II Directive (so-called RED II directive) guides the legislation in member states into a more environmentally conscious direction from 2021. Its objective is to secure sustainable development and the diversity of the environment.
The directive applies to energy and circular economy operators that now will have to report their environmental load more accurately than before. In the future, more attention will be paid on the origin of the used materials and the environmental impacts of production and transport.
Sustainability reporting is difficult by hand
The material balance system monitors the amount of biomass fuels used in the production of electricity, heat, cooling and biogas.
According to data on the emissions trading registry, the new regulations will apply to about 130 Finnish business operators. This means that they are expected to create a sustainability system that shows that the sustainability criteria for biomass is met as well as create a material balance system. The system monitors the amount of biomass fuels used in the production of electricity, heat, cooling and biogas.
In the future, these operators must collect sustainability reports in three relevant sections in their operations which are:
- The CO2 emissions of the transportation of their fuels and raw materials
- The CO2 balance of production
- Origin of materials. We talk more in depth about the triple challenge in sustainability reporting in our guide: Sustainability reporting in the energy and circular economy sector
Each point of the triple challenge involves several different calculations. For example, emissions caused by transportation depend on things such as the transportation distance, types of vehicles and fuels used as well as selected driving routes. All this data must be collected one way or another unless the company already has a system in place that collects the reports automatically.
This means there is a lot to calculate. Leave Excel out of this – filling in Excel tables is time-consuming, and exposes to errors. In practice, the easiest and most reliable way to automate the reporting related to your supply chain is with an appropriate system.
There are many reasons to collect reports but one thing is for sure: the time and effort used in reporting is out of productive work. A functional system helps companies focus on what is essential in their business.
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