How To Improve Your ESG Score By Recycling Solvents (An Assessment of Scope 1, 2, & 3 Emissions)
In an effort to improve their ESG scores, companies and corporations are increasingly focused on reducing Scope 3 emissions in their value chains. Recycling solvent on-site represents a great opportunity for manufacturers to reduce Scope 1 emissions, and thus, lower Scope 3 emissions in their customers’ value chains. CleanPlanet is the only company in the industry keeping track of this data with our MyCleanPlanet monitoring portal.
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ESG and Emission Tracking
ESG (Environmental, Social, and Governance) mandates are being adopted by major companies around the world as they seek to reduce their carbon footprint and lower GHG emissions tied to their value chains. However, companies cannot simply track their emissions from the perspective of a manufacturer (Scope 1 & 2 emissions), they must also do so from the perspective of a consumer (Scope 3 emissions). Recycling solvents on-site greatly reduces Scope 1 & Scope 2 emissions for the manufacturer using solvents in their process, and thus, also reduces Scope 3 emissions for their customers that use their products in their own process.
CleanPlanet Chemical is the only business in the solvent recycling industry that offers technology sophisticated enough to track this type of data. Our MyCleanPlanet portal is the unique tool that allows you to monitor your solvent recycling efforts accurately so you can provide meaningful solvent recycling data related to GHG emission reductions. Tracking this kind of emissions reduction data will prove essential to obtaining ESG credits and achieving overall carbon neutrality.
What are Scope 1 & Scope 2 Emissions?
Scope 1 Emissions
Scope 1 emissions are GHG emissions from sources owned by a particular facility or company. The emissions that come from firing furnaces, boilers, cleaning processes, and company vehicles are Scope 1. They encompass industrial processes in the manufacturing of products and are essential to running a business. This type of data is easy for companies to track because it falls under the umbrella of the cost of doing business. Companies already track the amount of fuel purchased to run these pieces of equipment, so translating this to quantifiable emissions data is simply a matter of performing mathematical calculations. Ways to reduce one’s Scope 1 emissions are plentiful and obvious: purchase production equipment and company vehicles that are energy efficient and produce as little GHG emissions as possible (i.e., using electric vehicles for company vehicles vs. gasoline fueled)
Scope 2 Emissions
Scope 2 emissions are indirect GHG emissions associated with the purchase of electricity, steam, heat, or cooling for a facility. Although not directly tied to a company’s production efforts, Scope 2 emissions represent a significant GHG emission source that contributes to climate change. Like Scope 1 emissions, Scope 2 emissions are easily quantifiable and in fact, the EPA provides simple mathematical equations for determining these emissions.¹ Ways to reduce one’s Scope 2 emissions are also fairly obvious: heating and cooling your facility with heat pumps that run on electricity vs. natural gas or coal, for example. Unfortunately, reducing one’s Scope 2 emissions is limited by the power sources readily available, which are determined regionally. A company can’t switch to cheap, clean, hydro-electric power if there are no dams around.
Scope 1 and Scope 2 emissions, as we can see, are fairly easily identified and accounted for, granted a company is diligently keeping track of this type of data. However, according to an international non-profit group called the CDP – whose efforts include helping companies and cities disclose their environmental impact – Scope 1 and 2 emissions only account for an estimated 25% of all emissions tied to a company’s GHG emissions on average.² It’s clear that we need to focus more on accounting for our Scope 3 emissions if we want to really make a difference and lower global carbon footprints.
What Are Scope 3 Emissions?
Scope 3 includes all indirect GHG emissions that are tied to a company’s value chain and, depending on the industry, account for 75%+, on average, of their overall GHG emissions. They are “the result of activities from assets not owned or controlled by the reporting organization, but that the organization indirectly impacts in its value chain.”³ Upstream Scope 3 emissions encompass the emissions tied to the products and services a company purchases to carry out their own business. Decreasing one’s upstream Scope 3 GHG emissions involves procuring materials and services from companies whose Scope 1 and 2 emissions have been clearly tracked and reported and kept as low as possible. Downstream Scope 3 emissions account for GHGs related to products or goods after they leave a company’s ownership.
Breakdown of Scope 1, 2, & 3 Emissions⁴
Background of Scope 3 Emissions
Historically, companies have been obliged by regulators – such as the EPA – to disclose emissions tied to their internal practices. Taking this a step further, in March 2022, the SEC (United States Security & Exchange Commission) “proposed a new climate disclosure rule which would require companies registered with the SEC to disclose climate-related information so that investors can consider climate-related financial risks when making investment decisions. This includes physical risks from the impacts of climate change and transition risks from moving to a lower carbon economy, including pressure to reduce greenhouse gas (GHG) emissions.”⁵ If we really want to tackle climate change in a meaningful way, it’s obvious that individuals, companies, and corporations must hold each other accountable for their GHG emissions. Doing so will require making informed decisions based on Scope 3 emissions tied to supply chains and end-user practices.
ESG and Scope 3
With the SEC’s new proposed climate disclosure rule coming into effect, Scope 3 emissions are obviously too significant and important to omit simply because of the challenges of data collection and reporting. More progressive companies with strong ESG initiatives have realized that if they want to reduce GHG emissions in their value chains, they need to target the specification of Scope 3 emissions. By holding their suppliers accountable for Scope 1 & Scope 2 emissions related to their operations – and giving preference to those doing their best to reduce those emissions – companies can make a huge impact. Company X, for example, tenders offers for paint products that they will use to paint components of the automobiles they manufacture. Pricing is obviously important, but if one paint supplier’s pricing is similar and they have done their best to reduce emissions involved in manufacturing their paint, this should certainly factor into the decision-making process.
Many of the largest automobile manufacturers have set sustainability goals and are committed to achieving carbon neutrality. Toyota, for example, has invited their suppliers and consumers to join them in reporting and tracking emissions data on the Manufacture2030 cloud platform. Here, suppliers can upload Scope 1 emissions data related to their own production, waste management, distribution, etc., and sell it as a Scope 3 emissions reduction initiative to their customers, i.e., Toyota. The benefit of using such cloud-based monitoring portals is that there is greater visibility into the data associated with activities that drive climate change. And if we can hold each other accountable for reducing our carbon footprint and still drive business, that’s a win-win situation.
Scope 3 Emissions and Solvent Waste Handling Practices
Many businesses today are focused on helping their customers attain their ESG mandates by making them more environmentally sustainable. For industries that use solvent in their cleaning and manufacturing processes (i.e. flexible packaging companies, paint manufacturers, OEM painting operations, chemical manufacturers, etc.), on-site solvent recycling is the best way to mitigate overall GHG emissions compared to other, more popular handling methods.
Offsite Recycling Methods
For the most part, companies that produce hazardous solvent waste ship it offsite for incineration, fuel blending, or recycling. With incineration, the solvent waste is burned off into the atmosphere, releasing a high amount of GHG emissions. When solvent waste is used in fuel blending, it is being combusted, but is put to good use by firing cement kilns, industrial furnaces etc., so that it’s not simply wasted like with incineration. Waste facilities will also take their customers’ waste and recycle it offsite. This process returns the solvent to a quality threshold so it can be returned to the generator and used again rather than purchasing expensive, virgin solvent. With all three management methods, a certain amount of virgin solvent will also need to be purchased to make up for the solvent shipped out for processing, although in decreasing amounts.
Companies that send their solvent waste for incineration off-site are producing the maximum amount of Scope 1 emissions possible, so their customers’ Scope 3 emissions will be higher. Those that choose to have their solvent waste fuel blended are still maximizing their Scope 1 emissions, however, they themselves will not have to take responsibility for the emissions produced in the burning process, and neither will their customers. The company using the fuel containing waste solvent will be required to report on this data. In this case, the company producing the solvent waste has lowered their customers’ Scope 3 emissions compared to incineration. With off-site recycling, the solvent waste is being returned to a quality so it can be reused by either the original company producing the waste, or another company that has a use for it. This method represents a huge improvement in Scope 3 emissions mitigation for a company’s customer base.
Onsite Solvent Recycling
If you’re serious about reducing your own Scope 1 emissions and your customers’ Scope 3 emissions, you need to be recycling solvent onsite. In fact, a report commissioned by the European Solvent Recycler Group (2013) found that “[r]ecycling of mixed solvents, acetone, THF, MEK, TEA and PERC leads to significant savings of greenhouse gas emissions (ranging from 46-92%) compared to the virgin solvents.” This data factors in the reduction of GHG emissions associated with virgin solvent make-up and solvent waste disposal methods. On-site solvent recycling takes it a step further, though, as emissions related to shipping virgin and waste solvent are almost eliminated from the equation.
CleanPlanet has revolutionized the way companies are recycling their solvents on-site. We are the only company that offers an on-site solvent recycling service that provides instant savings with zero capital expense. Our partnership ensures that our mutual financial success corresponds perfectly with your increased focus on ESG mandates. With our line of AlwaysClean solvent recyclers, we will recycle your solvent back to 99.9% virgin quality, which means less virgin make-up, and less hazardous solvent waste shipments. You’ll have recycled solvent available on-demand for endless re-use, which means you will greatly reduce your Scope 1 emissions and overall carbon footprint.
AlwaysClean Recycler's and MyCleanPlanet Portal - A Winning Combination
It’s all well and good to say that you’ve reduced your customers’ Scope 3 emissions by reducing your Scope 1 emissions, but can you back it up with actual concrete data? With a traditional on-site solvent recycler, this would be impossible. At best you can approximate your solvent recycling efforts and then perform a series of rough calculations to report on. Today, your customers and investors are demanding more, and require precise emissions data.
At CleanPlanet, we’ve identified the importance of this trend, which is why every AlwaysClean solvent recycler comes equipped with our proprietary MyCleanPlanet cloud-based monitoring portal. This web-based tool draws on data transmitted from over 50 sensors installed on our solvent recyclers, and allows you to monitor your solvent recycling efforts in real-time, and run reports on historical data. You’ll have all your Scope 1 emissions data at your fingertips, so you can easily present it to your customers as a Scope 3 reducing selling feature. At the drop of a hat, you’ll be able to accurately score the ESG impact of your solvent recycling efforts.
Go Green Today!
It’s clear that there is a shift occurring in the world of business. We’ve been aware of the impact that GHG emitting practices have on global warming for quite some time, but we’ve lacked the urgency to act on it. With increased regulatory pressure, larger companies and corporations have been forced to change the way they do business and find strategies to reduce their carbon footprints and remain profitable. Targeting Scope 3 emissions and holding each other accountable as both consumers and manufacturers is essential to attaining global net-zero targets, and CleanPlanet’s Service365 is the only solution available that is designed with this in mind. By recycling on-site with CleanPlanet, you’ll greatly lower your Scope 1 emissions and by association, your customers’ Scope 3 emissions. And the beauty of our solvent recycling solution is that we will save you money, keep you profitable, and make you more sustainable all at the same time.
Looking to start tracking your emissions while lowering costs?
Looking to start tracking your emissions while lowering costs?