The True Carbon Impact of Remote Work – Calculations for Ourselves and Our Clients

In the early days of the COVID-19 pandemic, organizations undertook extraordinary measures to quickly secure the health and safety of their workforce. With new measures effectively in place, many companies are now reimagining their future ways of working. Some leading companies like Goldman Sachs and Facebook are declaring remote work the new normal for at least part of their employee base. Others, like JP Morgan, are already shedding office space with the assumption that many employees will continue to work from home (WFH) after the crisis. As companies consider economic and cultural factors in these decisions, they must also take environmental factors into account.

What Is the Environmental Impact of Working from Home?

The environmental impact of working from home is more nuanced than it may appear at first. While carbon emissions from employee commutes may drop precipitously in regions where employees would otherwise drive to the office, these same employees are likely using more energy at home. The carbon impact is more intense when homes are inefficient, are connected to carbon-intensive grids, or rely heavily on non-renewable natural gas. As companies consider relinquishing direct control of the spaces in which employees work, they’ll need a new approach to evaluate this shift in emissions.

Looking at the Carbon Impact of Our Return-to-Office Scenarios

At ENGIE Impact, we’re committed to transparently sharing our own emissions reduction journey in a way that can help others transform as well. Like most organizations, COVID-19 has significantly altered our operations, forcing us to reconsider our new environment within our broader transformation efforts. Currently, 95% of our teams are working from home. Simultaneously, we are planning for what a partial return to office could look like pre-vaccine and for our longer-term ways of working.

To understand the carbon impact of our return-to-office scenarios, we leveraged our own team of carbon accountants and workplace energy experts to assess the true impact of our own WFH transition. While WFH has reduced our carbon footprint from commuting, we found that we needed to consider several additional location-specific factors in order to understand the true overall impact.

Office Carbon Footprint Analysis and Key Findings

Our experts surveyed our entire office footprint and completed an in-depth analysis of two of our larger locations. Here are some key findings, which we hope will prove helpful to other organizations seeking to strike an ideal balance of office-vs-WFH work.

1. Office Design and Efficiency: When calculating emissions, office density and efficiency are critical factors. The combination of commercial building standards and professional facilities staff enabled our offices to operate more efficiently than homes pre-COVID in some cases. When looking at office efficiency post-COVID, real estate teams must consider how the virus may change office operations. HVAC systems are some of the largest carbon contributors in office spaces, so less dense offices mean more carbon per employee. Public health regulations in our locations are likely to require reduced density (50% in Phase 3) until a vaccine is available. In addition, depending on the buildings’ pre-existing systems, more energy may be required post-COVID for any changes to ventilation systems that may be required.
   
2. Residential HVAC: Most homes in the U.S. do not take full advantage of zoning for heating and cooling, as office buildings do. The calculus changes depending on where offices and employees are located. In heating load-dominated climates, where the majority of our U.S. office footprint is, the incremental energy used to heat the home during work hours might be more carbon-intensive than our office baseline. Of the two offices we assessed, in Saint Paul, Minnesota, and Spokane, Washington, St. Paul had a higher work from home footprint as compared to the office, primarily driven by home heating load. In addition, it is more difficult for companies to intervene on home energy use than office energy use. One possible avenue to explore for ongoing remote workers is the adoption of smart thermostats for those with compatible heating systems. This could apply equally well to those who own their homes or rent because landlords typically need not be involved.
   
3. Procurement and Offsetting Strategy: We are also considering our strategy for green energy procurement and offsetting going forward. While it is often easier for larger operations to procure green energy, it may not be impossible for homes. We could envision more companies instituting programs to help employees sign up for local opportunities to purchase residential renewables. Furthermore, companies may consider offsetting residential emissions. At ENGIE Impact, we’re conducting extensive analyses to examine how WFH should be factored into our current offsetting standards. This is a significant shift for many companies, and implementing changes of this kind requires a corresponding shift in mindset and investment.
   
4. Commuting: For offices in dense urban areas where most employees take public transportation, commuting was not a significant emissions factor pre-COVID. (The impact of COVID-19 on the use of public transportation over the long term remains to be seen.) For offices where car commuting is the norm, our study revealed that a reduction in commuting is the most reliable way to reduce carbon – even after factoring in the potential for increased energy use in a WFH environment. This suggests we should look for ways to improve traditional programs that support the reduction of commute emissions: encouraging electric vehicle usage and charging on-site, public transit, and carpooling. In addition, increasing participation in WFH would reduce our carbon footprint in these locations even if we had to maintain oversized offices.

We are currently in the first wave of the pandemic, but leading researchers are predicting subsequent waves that may require future shelter-in-place periods. Investments have already been made to enable a more virtual workplace by companies. As companies plan to return to office in the short-term, they have the opportunity to maximize what we’ve learned about the long-term positive impacts to healthy, low-carbon and resilient workplaces.

Office-Based vs Remote Work Studies for our Clients Reveal Additional Benefits

One client in the financial industry saw a 100% reduction in business travel, saving ~1600 tCO₂e practically overnight. To lock in these benefits post-COVID, they’ve been wisely investing in technology and behavioral change to build a more flexible and resilient workforce. For this client, our analysis did show an increase in emissions associated with working from home, which did not offset the decrease in Scope 1 and Scope 2 emissions from office buildings. We are now helping them strike the ideal balance between office-based and remote work, using the same approach we use internally for ENGIE Impact. Based on the results of our analyses, we made recommendations for operational, environmental and energy-related actions to optimize costs, health and carbon.

Others are finding further benefits for employee retention and talent acquisition. These clients report their employees enjoy working from home, are more productive, and don’t miss the commute. And while managers may need to adapt their styles for monitoring employees’ work, they also can now draw from a much larger talent pool when hiring.

Data is Essential to Inform Your Workforce Decisions

At this early stage, the data suggests that a mindful balance of office-vs-WFH work is something all companies should consider, both for carbon and productivity benefits. But, as our analysis reveals, the trade-offs are not always intuitive, so running the numbers is essential to making the right decisions for the environment, your employees and the bottom line.

To learn more about our studies’ assumptions or initiate an analysis for your own operations, contact us.

ENGIE Impact would like to thank Asma Ghazouani, and Neetu Mysore for their contributions to this article.