What is a Carbon Reduction Plan (CRP)? 

Please note: This article is for educational purposes only. It does not replace official UK Government guidance on PPN 006 or carbon reporting requirements.

A Carbon Reduction Plan (CRP) assesses a supplier’s current carbon footprint and outlines their strategy to achieve net zero emissions. Required for UK Government contracts under PPN 006, it provides a high-level summary of an organisation’s emissions and demonstrates compliance with procurement policy.

Contents

1. What are Carbon Emissions?
2. Why Reduce Carbon Emissions?
3. What is a Carbon Reduction Plan (CRP)?
4. How to Set Your Carbon Reduction Plan to Comply with PPN 006
   1. Commitment to Achieving Net Zero
   2. Baseline Emissions Footprint
   3. Current Emissions Reporting
   4. Emissions Reduction Targets
   5. Carbon Reduction Projects
   6. Declaration and Sign Off
5. Benefits of Implementing a Carbon Reduction Plan

What are Carbon Emissions?

Greenhouse gas emissions, commonly referred to as carbon emissions, release gases such as carbon dioxide (CO₂), methane, and nitrous oxide into the atmosphere through human activities like burning fossil fuels for energy, industrial processes, transportation, agriculture, and deforestation. These emissions trap heat in the Earth’s atmosphere, contributing to global warming and climate change.

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Why Reduce Carbon Emissions?

Carbon emissions, primarily from energy production, transportation, industry, agriculture, and deforestation, contribute to rising temperatures, extreme weather events, and sea-level rise. Reducing carbon emissions is essential to combat climate change, protect the environment, improve air quality, and ensure a sustainable future. Lowering these emissions preserves ecosystems and biodiversity, enhances public health by reducing pollutants, and promotes a healthier planet for future generations.

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What is a Carbon Reduction Plan (CRP)?

In 2019, the UK Government became the first major economy to make a legal commitment to net zero carbon emissions, with an ambitious target of reaching net zero by 2050. In order to support this goal, several measures, policies, and interim targets have been established. PPN 006 is one example of this.

PPN 006, a Procurement Policy Notice issued by the UK Government in June 2021, outlines criteria that organisations must adhere to when bidding for contracts valued at £5 million per annum or more. This policy mandates suppliers to commit to achieving net zero carbon emissions by 2050 and requires them to publish a Carbon Reduction Plan (CRP).

The Carbon Reduction Plan details the organisation’s emissions for a specified year and helps both suppliers and customers understand the environmental impact of their procurement decisions. While meeting specific reporting requirements, the CRP does not replace ongoing carbon footprint reporting but provides a high-level summary demonstrating compliance with PPN 006.

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How to Set Your Carbon Reduction Plan to Comply with PPN 006

The content and structure of the CRP is detailed in the Carbon Reduction Plan Template published alongside PPN 006 by the UK Government. A Carbon Reduction Plan consists of six sections:

1. Commitment to Achieving Net Zero

Suppliers must confirm their organisational commitment to achieving Net Zero by 2050 at the latest, aligning with the UK Government’s obligations under the Climate Change Act. This commitment entails reducing emissions as much as possible and subsequently offsetting any unavoidable emissions that remain. Selecting an earlier net zero target date is acceptable, but there is no inherent advantage in choosing a date earlier than 2050 unless previously planned.

2. Baseline Emissions Footprint

To achieve the net zero target, suppliers must determine their carbon emissions for the baseline year. This involves measuring direct and indirect emissions, categorised into three Scopes by the Greenhouse Gas Protocol:

• Scope 1: Direct emissions from owned or controlled sources.
• Scope 2: Indirect emissions from the generation of purchased energy.
• Scope 3: Indirect emissions not included in Scope 2 that occur in the value chain.

All Scope 1 and Scope 2 emissions must be included in the CRP, along with a subset of Scope 3 emissions across five categories: Upstream Transportation and Distribution, Waste Generated in Operations, Business Travel, Employee Commute, and Downstream Transportation and Distribution. If any category does not apply, a brief explanation must be provided.

3. Current Emissions Reporting

After establishing the baseline emissions, businesses should measure the carbon footprint of their operations for the current year. For the first year of reporting, the current emissions will be the same as the baseline emissions. Any changes in company structure and operations since the base year must also be considered.

4. Emissions Reduction Targets

Suppliers are required to provide details of their existing and new emissions reduction targets, including both short-term and long-term goals. Short-term targets typically span between 1–10 years from the base year, while long-term targets extend beyond ten years and may include a net-zero target.

5. Carbon Reduction Projects

Suppliers are required to detail past, current, or intended carbon reduction projects and explain how these initiatives achieve carbon reductions against the base year. Examples include the adoption of LED/PIR lighting controls, policy changes resulting in reduced company travel and flights, or the electrification of the company fleet.

6. Declaration and Sign Off

Once the Carbon Reduction Plan has been created, it must be signed off by a representative of the board of directors or equivalent and published on the organisation’s website.

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Benefits of Implementing a Carbon Reduction Plan

• Enhanced Business Reputation: Demonstrating commitment to sustainability through a carbon reduction plan builds trust with customers, partners, and investors.
• Cost Savings: Reducing energy consumption and emissions can lead to significant savings through lower utility bills and operational expenses.
• Environmental Stewardship: A commitment to carbon emission reduction contributes to environmental sustainability and corporate social responsibility.
• Regulatory Compliance: Compliance with carbon emission regulations and reporting requirements reduces the risk of penalties and reputational damage.
• Competitive Advantage: Organisations that proactively address carbon emissions gain a competitive edge by attracting environmentally conscious customers, investors, and partners.

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