Carbon Q&A

By Mark Nicholson

May 2023

A climate change guide for materials handling professionals

There’s a lot of talk about carbon today – and there will be much more as the climate change crisis deepens. We continually hear terms like carbon footprint, carbon neutral, net-zero, carbon offsetting and carbon credits. But are we clear on what they mean? Mark Nicholson offers a simple explanation, as a starting point for planning the decarbonisation of your business.

What are carbon emissions?

What we really mean is emissions of carbon dioxide (CO2). The excess of CO2 in our atmosphere today is produced largely – but not entirely – by burning fossil fuels. We burn huge amounts to power vehicles and industrial machinery, to heat buildings and to generate electricity, for example.

Why are carbon emissions a problem?

Together with other greenhouse gases (GHGs), including methane, nitrous oxide and fluorinated gases, they accumulate in the upper atmosphere. There they trap much of the heat which would otherwise escape into space – and radiate some of it back down to earth. The result is rising global temperatures and climate change.


The main carbon emission source: burning fossil fuels.

What is a carbon footprint?

This is a measure of something’s climate change impact through carbon and other GHG emissions. The ‘something’ can be a country, a company, a business operation, a person, a product or any other entity. A carbon footprint is the sum – in tonnes – of all GHGs resulting from that entity’s existence and activities.

Although we call it a carbon footprint, it normally takes other GHGs into account as well. For those, we work out how much CO2 it would take to have the same heat-trapping effect. The final carbon footprint figure is then expressed in tonnes of CO2 equivalent (CO2e).

How do you measure your carbon footprint?

If you do a web search for ‘carbon footprint calculator’, you will find many online aids. There are also plenty of organisations who will help you to measure and reduce your carbon footprint. Search ‘carbon reduction services’.

For the best possible measurement, you need to think beyond the most obvious sources of emissions. There are three ‘scopes’ to consider. Let’s look at these in relation to a warehouse or factory business, for instance.

Scope 1 – direct emissions from your business

Includes emissions from any vehicles, lift trucks, manufacturing plant and heating systems which run on petrol, diesel, gas or solid fuel.

Scope 2 – indirect emissions relating to energy bought from a utility provider

In most cases this means electricity. Your forklifts and other equipment may be electric, and non-polluting, but how was the electricity generated? Often, it’s produced by extracting and burning fossil fuels.

Scope 3 – all other indirect emissions

This covers a lot of emissions which result from your company’s activities but which are not under your direct control. For example, GHGs are emitted in the manufacture of the trucks, equipment, pallets and packaging you use. There are activities throughout the supply chain – like production and delivery of raw materials – whose emissions are linked to your operation. Consumers’ use of the products you supply may also generate emissions. In addition, management of your company’s waste requires energy and therefore produces emissions.


What does carbon neutral mean?

Your organisation, activities or products can be described as carbon neutral if their related CO2 emissions are balanced by CO2 absorption. There are natural carbon sinks which absorb and store CO2. This is called carbon sequestration. The main sinks are soils, forests and oceans.

In working out whether something is carbon neutral, nature’s current capacity to absorb CO2 is considered. Sadly, that capacity is being reduced by damage and loss of soil, forest, ocean and other ecosystems. Technologies which can physically remove CO2 from the air have been developed, but their effect is currently small compared to natural sinks.

The term ‘climate neutral’ is sometimes used to reflect the fact that CO2 is not the only GHG. You may also see the terms ‘carbon negative’ and ‘climate positive’. These describe situations where less CO2 (or GHG as a whole) is emitted than is absorbed. This is an even better result.

Is net-zero the same thing as carbon neutral?

They are similar, and the terms are sometimes used interchangeably, but there are subtle differences. Both principles involve balancing CO2 emission with absorption. However, net-zero targets tend to be much wider – covering whole regions, countries, organisations or supply chains, for instance. They also tend to highlight other GHGs as well as CO2. Their focus is very much on reducing emissions, with only a small part (if any) of the balance relying on carbon offsetting. (See next section.)

You might occasionally see the terms ‘carbon zero’ or ‘zero carbon’. These refer to cases where no CO2 is produced by the related activities. This would be very unlikely in any industry.


'Clean' energy - from solar and wind farms, for example - is crucial to decarbonising.

What is carbon offsetting?

Carbon offsetting means compensating for some of your emissions by financially supporting CO2 reduction projects somewhere else. Your priority, of course, should be to reduce your own impacts. However, for many vital activities there are limits to how far this can realistically be achieved – or how quickly. Offsetting enables progress in tackling climate change to be made in other ways.

Examples of projects you can support include conserving, restoring or planting of forests. If carbon is to be permanently locked (sequestered) in the trees, forest fires and large-scale logging must be avoided. Carbon storage can also be increased by improving the condition of agricultural soils and a range of natural habitats.

Other offsetting projects involve investment in renewable energy generation and in deploying more energy-efficient technologies for industry and society. They are often targeted at helping people in developing countries who are especially vulnerable to the effects of climate change. They may range from building wind or solar farms, and electrifying industrial plants and vehicle fleets, to replacing household cooking stoves with more efficient versions. Development and use of artificial carbon sinks which capture CO2 directly from the atmosphere is another area for funding.

Importantly, you should choose carbon offsetting schemes whose projects are backed by recognised standards and certifications. An internet search for ‘carbon offset standards’ will lead to information on those. Search also for ‘carbon offsetting services’ and you will find a variety of companies offering projects.


What are carbon credits?

Some countries and regions run carbon cap-and-trade programmes. The EU’s Emissions Trading System (ETS) is a good example. Each company is given a limit on how many tonnes of CO2 (or other GHGs) it’s allowed to emit. If it emits less, it can sell the unused portion of its allowance to another company. Each tonne of this transferrable allowance is called a carbon credit.

Companies buy carbon credits if they are unable to stay within their given emission limits. It solves a problem for them in the short term. In the longer term, the system gives them an incentive to reduce their emissions and avoid the cost of carbon credits. For companies selling carbon credits, there is an incentive to reduce emissions further and sell more.

For practical advice on reducing your climate change impacts, and your costs, visit our Eureka online library.