Comment by Elle Butterworth – Energy Policy Advisor. 

The ability to exchange, compare, track and trace emissions data through supply chains will be fundamental to the UK’s future low carbon economy. Complete and accurate data will support innovations relating to carbon intensive products and processes. Data will also support Government and consumers to make informed, low carbon, decisions.

Our latest report, Carbon Accounting and Standards in Industry, highlights opportunities for digital technologies to simplify emissions reporting and increase the comparability and interoperability (interoperability refers the ability of digital systems to exchange information) of emissions data. We propose data exchange could be facilitated through the effective coordination of a distributed digital systems architecture (Figure 1).

The requirements on industry to report emissions will evolve over time with emerging stakeholder needs and new Government policies. Existing static reporting tools, such as Microsoft Excel spreadsheets, do not support the incorporation of more data sources and more frequent data updates, nor are they easily adaptable to new reporting requirements.  

It is also unlikely that a single digital platform can be designed and managed to accommodate all future scenarios, and there are already digital platforms in development to support different use cases. A distributed digital systems architecture that standardises emissions MRV at the point of disclosure will allow policymakers to leverage digital tools as they develop, such as using digital twins to inform policy.  

In our report, we propose the following high-level digital infrastructure principles required to facilitate emissions data exchange:

• Distributed hosting – emissions data that relates to the fundamental activities of an organisation should be maintained by the organisation and made available for onward consumption by any authorised parties. This ensures that a single source of truth is maintained and propagated.
• ‘Pull’ not ‘push’ – data consumers (e.g. Government and industry customers) should pull data from all relevant sources at the point of need rather than prescribing routine submissions of bespoke data. This ensures that data consumers are able to implement their own processing techniques and enables a ‘one-to-many’ relationship between data generators and data consumers.
• Coordinated governance – Data requirements need to be streamlined and broken down to the ‘lowest common denominators’ to minimise the burden on data generators. Our previously proposed Carbon Regulator would be well placed to provide the effective coordination needed to ensure the interoperability of emissions data from distributed reporting systems and establish the standards required for the development of digital carbon accounting platforms.

The challenge of sharing data between industry stakeholders is being looked at across the sector. We were recently appointed by the Department for Energy Security and Net Zero (DESNZ) to carry out a feasibility study of a ‘digital spine’ concept for the UK energy system.

Greg Johnston, Senior Digital & Data Consultant at the Catapult said, “The ‘digital spine’ is a concept of technical processes and defined governance roles and responsibilities that would allow the exchange of energy system data in a secure and interoperable manner. Concepts like this could also be a key enabler for sharing carbon accounting data.”

A ‘digital spine’ for carbon accounting could enable different emissions data “generators” (such as energy suppliers and upstream emitters) and data “consumers” (such as industry customers and Government) to securely exchange information in a standardised format. For example:

• Industry could exchange emissions data with their upstream supply chains to complete Life Cycle Assessments (LCAs) and,
• Industry customers could obtain the data they need to support low carbon procurement practices in a streamlined and standardised format.

Our report recommends policymakers embark on the development of a distributed, scalable digital infrastructure to underpin emissions data exchange.

To promote effective coordination of carbon policies and digital systems architecture, mandatory MRV requirements and regulatory oversight will be needed, we talk about how this could be facilitated through an independent Carbon Regulator, with economy-wide oversight, in our report. More work is also needed to ensure industry has the digital skills needed to support the digitalisation of emissions data.

We will continue to explore how to best operationalise a carbon accounting framework for industry and the wider economy, including in our response to Government’s consultation on Addressing Carbon Leakage . We are also keen to hear from SMEs and innovators working in the digital carbon accounting space to help develop our proposals further.