As ever, a new year summons forth the usual host of fresh resolutions and good business intentions.

Scanning the ‘green horizon’ gives an indication of a key environmental area which may be of interest and perhaps should be high up on the list of sustainable business priorities in the year ahead.

Carbon management plays a vital role in reducing business risks associated with policy and regulatory development and energy market price fluctuations. Legislation, regulations and economic drivers provide a corporate focus and influence an organization’s decision making however, the process of reviewing, monitoring and measuring energy input and carbon output and developing a carbon management plan can often seem like a daunting task.

Large public and private sector organizations are already obliged to play a leading role in creating a low-carbon economy through participation in the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme.

The CRC scheme is a mandatory carbon trading scheme for large organizations using more than 6,000MWh per year of electricity. The success of the CRC scheme is monitored and rated by the National Performance Indicators (NI), which measures performance and compliance with the Energy Performance in Buildings directive.

Managing carbon emissions might well be established in the public sector and amongst large private sector organizations but more widespread participation is essential if the UK is to meet binding Climate Change targets set down by the Kyoto protocol - these amount to an average of five per cent reduction against 1990 baseline levels over the five-year period 2008-2012 for 37 industrialized countries and the European community.

All businesses can benefit by adopting a similar approach to larger organizations. Reviewing business practices and developing and implementing a carbon management plan is an essential first stepping stone towards scrutinizing resource use and reducing business costs through early intervention projects, best business practice and an energy efficiency policy.

A well designed carbon management plan acts as a catalyst, helping an organization examine its resource consumption and providing a clear picture of its carbon emission levels. Developing a baseline and monitoring energy consumption throughout an organization often results in the identification of operational inefficiencies. By developing and implementing a carbon management plan and identifying early interventions, organizations can develop relatively low cost / quick win solutions and long-term financial savings. This brings about a host of benefits which include;

• Increased understanding of energy consumption

• Identification of operational inefficiencies and process cost savings

• Reduced environmental / carbon footprint

• Access to grant funding and Loan Guarantee Programs

• Positive company image and marketing opportunities

• Quality assurance and customer confidence

• Improved employee recruitment and retention

• Being prepared for new legislation, policy and regulation

Presently, low carbon prices throughout Europe is stimulating policy action and it is anticipated that the European Parliament will press forward with a plan to push up the carbon price. With Denmark at the EU helm in 2012, it seems likely that it will use its presidency to bring about an early release of new policy.

Looking forward and gaining a basic understanding of carbon management and how EU policy will translate into the UK government’s regulatory framework will help businesses to prepare and take action to mitigate the impact of regulatory intervention.