As the world faces the urgent need to decarbonize in order to mitigate the effects of climate change, organizations of all types and sizes are turning to digital tools for carbon data management as a data-driven way to adhere to regulatory demands and measure progress against public targets. This trend is supported by the findings in our 2023 Net Zero Report that show that of the organizations that currently lack digital carbon data management tools, 55% will adopt a solution by 2025.
While the market for digital tools to manage carbon data continues to grow to meet this demand, it’s important to remember that not all digital tools are created equal. Before adopting a solution, organizations need to consider the variety of options available, the pain points involved with implementation, and how the digital tool can integrate and scale with an evolving decarbonization strategy.
The initial demand for carbon data management tools was focused on the annual measurement, monitoring, and mitigation of carbon emissions, with the goal of providing data and reporting to internal and external stakeholders. This usually involved gathering first-party carbon data and feeding it into a standardized tool that would aggregate the information. This once-a-year engagement was low complexity, didn’t demand real-time data, and could be done retroactively. But the basic inputs for the solution presented barriers to its usefulness in more complex situations. This type of data collection was incomplete for organizations looking to map the trajectory of their Net Zero progress. As the demand for real-time decarbonization data has grown, the need for more complete carbon data management — including digital tools that could aggregate as well as manage complex decarbonization data — has also increased.
The demand for more complex digital tools to manage carbon data has created a new supply of solutions in the market that allow organizations to take a data-first approach to their Net Zero commitments. These specialized digital tools cater to specific challenges in the decarbonization journey, providing the capability to collect and handle real-time data with ease, thus keeping the organization's decarbonization progress on track. There are many digital tools currently used for complex carbon data management, some of which include:
These tools help organizations track and report their greenhouse gas emissions in order to meet regulatory requirements and set reduction targets.
These tools allow organizations to monitor and control energy consumption in real-time in order to identify opportunities for energy savings and efficiency improvements.
These platforms allow individuals and organizations to offset their carbon footprint by investing in projects that reduce or remove greenhouse gas emissions, such as reforestation or renewable energy projects.
The increased capabilities these tools provide can be attractive to organizations looking for a turnkey solution. But looking for a digital tool to meet a specific need can often cause organizations to become near-sighted with their strategy. The individual nature of these tools can be appealing but having independent tools for every decarbonization need can be a barrier to creating a holistic sustainability strategy that allows for data orchestration across the organization. In addition to its integrative capability, there are other key challenges organizations may encounter with carbon data management tools.
The cost of implementing digital decarbonization tools can be high, especially for small- and medium-sized organizations.
Turn-key digital tool solutions can lack the flexibility needed to grow and change with the evolving demands of decarbonization strategies. In addition, solutions developed by start-ups have a higher risk of failure in comparison to more established players.
Tools require organizational training and maintenance, which can be difficult and time-consuming.
The quality and accuracy of data used in digital decarbonization tools are crucial for the decision-making process. Inaccurate data can result in wrong decisions or even inaction.
As organizations scale, tackling these problems on a case-by-case basis can quickly become an overwhelming task. They often struggle to implement digital tools at the right pace and cost and lack the resources to navigate common challenges as they arise. The good news is there is another option for utilizing digital tools to avoid these common challenges.
Maximizing the effectiveness of digital carbon data management tools requires a comprehensive and integrated approach that combines technical expertise, data analysis, and subject matter knowledge. Partnering with an expert that can provide true carbon data management — a holistic roadmap for your decarbonization strategy — allows you to move beyond addressing isolated issues and gain a clear understanding of how these tools can fit into the broader picture. Additionally, a managed service partner can help navigate the common challenges associated with cost, longevity, maintenance and data management that are inherent in digital decarbonization solutions.
As the decarbonization landscape continues to evolve, piecemeal digital solutions will not meet the needs of the business or the demands of stakeholders for much longer. Building a future where organizations invest in full decarbonization transformation starts with a big-picture strategy and a conscious approach to holistic carbon data management and digital tools that can accelerate their progress.
Get in touch with our sustainability consultants to discuss your decarbonization strategy.