CarbonNeutralCheckout™ is designed by CCC to assist organizations in reducing the carbon footprint of the products and services they sell.
Carbon Neutral Checkout™ aims to adopt low-carbon materials and quantifiably mitigate the greenhouse gas impact of any production process or service provision.
CNC is an innovative carbon offset program that offers organizations the potential to reach carbon neutrality by integrating a carbon price into the individual products and services they sell, without incurring an additional cost to their bottom-lines.
Unlike traditional bulk carbon offsetting approaches, CNC takes a different, micro path to engage the consumer (public), as well as institutional and business sectors to tackle not just the challenge of carbon mitigation itself, but the difficulties associated with making carbon neutrality financially affordable, and logistically feasible.
The program utilizes partial life cycle assessment to quantify GHG emissions from an individual product or service a corporate sells. CNC defines the inventory boundary as cradle-to-gate, which includes all emissions from raw material acquisition, to when the product leaves the corporate’s gate for sale to consumers. The carbon accounting system behind Carbon Neutral Checkout™ follows the Greenhouse Gas Protocol (GHG Protocol) - Product Life Cycle Accounting and Reporting Standard, and the PAS 2050:2011 Standard.
With this information, CCC yields a dollar value that, if added to the sticker price of any product or service, would offset the cradle-to-gate life cycle inventory for a single unit. The monies raised by the added cost to the product itself are used to purchase carbon offset credits that fund emission reduction projects.
Companies of any size can easily obtain a better understanding of which raw materials are the primary source of a product’s carbon footprint, as well as which specific segments of a supply or value chain are carbon hot-spots.
CNC has the potential to mitigate billions of tonnes of CO2e, at an industrial scale and generate interrelated cycles that benefit corporate, societal, and environmental parties.
What actions do you propose?
Massachusetts Institute of Technology (MIT) has enjoyed a well-recognized reputation globally and has abundant alumni that play different roles in society. This alumni diversity is a great way to leverage the Carbon Neutral Checkout™ (CNC) program throughout various industries and sectors. As mentioned above, CNC can be implemented in almost any organization – please find below an outline of the specific actions that can be taken by MIT alumni, and how such actions can feasibly be implemented.
CNC has 5 key steps. Potential MIT alumni action for each step is as follows:
Businesses express a willingness to understand and/or mitigate their products’/services’ carbon footprint (Engagement).
MIT Alumni Engagement Action:
MIT alumni commit to participate in the Carbon Neutral Checkout™ program by understanding their businesses’ carbon footprint and offsetting their individual products and, or services through consumer engagement (the purchase of company products or services by customers) to attain a carbon neutral status for such specified products, as well as to support those in the communities positively affected by the execution of carbon offset projects.
The interactive Carbon Neutral Checkout™ platform calculates the carbon footprint from the life cycle of a product or service through data analysis of relevant corporate information related to a given product or service (Information Sharing).
MIT Alumni Information Sharing Actions:
MIT Materials Systems Laboratory alumni can support the development of the Carbon Neutral Checkout™ carbon emissions factor database by sharing their latest research regarding the carbon footprint of certain materials in order to achieve better accuracy in the calculation of product and service carbon footprints.
Specific action taken by adopting companies: collaborative data reporting. This reporting involves identifying key data points and working either individually or as a team to find reliable current data to be submitted for analysis and carbon footprint estimation.
3. The above analysis results in determining a carbon footprint for a specific product or service from cradle to gate (raw materials – purchase by consumers - Carbon Footprint Calculation).
MIT Alumni Calculation Actions:
No action necessary at this stage for adopting companies - Carbon Credit Capital assumes all carbon calculation responsibilities and tasks. Upon the completion of the carbon footprint calculation exercise, CCC will deliver to an adopting company a carbon footprint per product or service.
4. Integration of carbon pricing into individual units of product or service, making them carbon neutral upon purchase by a consumer (Implementation).
MIT Alumni Implementation Actions:
By engaging, sharing, and implementing, adopting companies and organizations end up financing carbon offset projects through consumer contributions. Specific actions taken by adopting companies: make a decision as to whether to pre-pay (i.e. offset in bulk directly through the company’s budget), to fully implement pricing (pass 100% of costs on to consumers), to make the integration of carbon pricing voluntary, or inclusive to consumers (allow the consumer to decide whether or not to offset). Companies must also decide which offset projects to support, and what time line will be followed for offset retirement intervals (quarterly, bi-annually, annually).
5. Consumers pay for the mitigation carbon emissions upon their purchase through a carbon neutral checkout. At predetermined intervals, CCC will invoice adopting companies, with the invoice matching the funds raised through CNC, and upon the receipt of payment will retire an equivalent amount of carbon offsets on behalf of the adopting company and its products specified under the program (Back-end Reporting & Offsetting).
MIT Alumni Reporting and Offsetting Actions:
At this stage, adopting MIT alumni companies need only to collect the final sales data which seamlessly translates into the carbon emission volumes to be reported to CCC for retirement, while enjoying the added benefits of marketing, outreach, and promotional support of being a carbon-neutral brand or business.
CCC proposes to partner with MIT’s Alumni Club to develop positive actions to mitigate carbon emissions, including but not limited to:
- Having MIT alumni commit the companies they manage to participate in Carbon Neutral Checkout™ through understanding their businesses’ carbon footprint and offsetting their products (either via an internal budget, or the end consumer) to attain carbon neutral status, as well as support environmentally friendly carbon mitigation projects.
According to a newly released report written by Edward B. Roberts, Fiona Murray and J. Daniel Kim, entrepreneurship is a strong marker of MIT’s global impact: 23% of MIT alumni’s new firms are founded outside the U.S. This in part reflects the global nature of the alumni themselves (some 30% of MIT’s current undergraduate and graduate students were born outside the U.S.), as well as the students’ global aspirations. More stunningly, the report estimates that MIT alumni have launched 30,200 active companies, employing roughly 4.6 million people, and generating close to $1.9 trillion in annual revenues.
The companies in a wide range of sectors (from consumer products to manufacturing) do not only control a great amount of social and natural resources, but also generate a significant amount of carbon emissions. The novelty of the Carbon Neutral Checkout™ program lies in the notion that it can be implemented at no direct cost to a company. Doing so allows companies to save the time and money that would have otherwise been put towards purchasing offsets, and to direct that time and money to the development of low impact materials, renewable energy, and the refinement of existing supply chains. The numbers in the chart above suggest that if MIT alumni-managed businesses were to engage in CNC™, a reduction of atmospheric GHG emissions by hundreds of thousands, or even millions of tonnes could be achieved. Below are details of several actions that can be taken by the MIT community, the positive environmental impact of such actions, and implementation scenarios as to how they can actually be executed.
- Businesses with MIT alumni managers can engage with Carbon Credit Capital to share key data points, implement product carbon pricing, support high quality offset projects, report and offset the carbon emissions of their products and/or services.
As briefly described above, MIT alumni-managed businesses account for a potentially substantial carbon footprint globally. By engaging in the actions (1-5) described in the first table above, these businesses can substantially mitigate their footprints via Carbon Neutral Checkout™. Implementations of these actions can be as simple as an adopting company saying “Yes” to fight the challenge of climate change. The actual inclusion of pricing of carbon offsets into products and services is flexible, and can vary according to corporate structure, the company’s supply chain, and the line of products and services themselves. This means that companies can construct an implementation of Carbon Neutral Checkout™ that best fits their business, and need not worry about conforming to the implementation that is common amongst other companies.
- MIT Materials Systems Laboratory members can support the development of Carbon Neutral Checkout’s emissions factor database by sharing their latest research findings for the carbon footprint of certain materials.
MIT Materials Systems Laboratory is a research group at MIT that studies the strategic implications of materials and material processing choices. The Laboratory conducts research that seeks to understand the competitive position of materials in specific applications, such as assessment of different candidate materials, assessment of processing technologies, and evaluation of both the economic and non-economic consequences of each alternative.
Currently, the research findings are generally applied to the automotive industry, the electronics and photonics industries. Carbon Neutral Checkout™ has been working with the transport, retail, hospitality, and food sectors to deliver carbon neutral products and services. The direct action proposed here is a partnership of information sharing between Carbon Credit Capital and the MIT Material Systems Laboratory, in order to expand the spectrum of products and services that CCC can help make carbon neutral through CNC. Implementation of these actions is simply up to the MIT Material Systems Laboratory as to whether they would enter into such a partnership, and to what scale and scope.
Who will take these actions?
Carbon Neutral Checkout™ adopts a bottom-up approach to embrace a wide range of social sectors as followings
The Business Sector
As stated above in the Summary section, business sector entities will join CNC as members and will collaborate with us to provide general data and information to the CNC team for the calculation of a product or services' carbon footprint. The actions taken by businesses are simply involvement, data sharing, implementation of product carbon pricing, supporting high quality offset projects, reporting of production/sales, and payment of invoice (using revenues received through CNC™) to facilitate the retirement of carbon offsets. By taking these actions, companies set the stage for consumers to take actions to influence the market by purchasing and demanding carbon neutral products where the opportunity for such actions was previously close to non-existent.
Research Institutes and NGOs (IP, EDU, AWARE)
CNC can also partner with any organization working on analyses of raw materials life cycles to support the calculations of product carbon footprints. This kind of partnership can fully utilize research findings in a laboratory setting and actually put this research to work while further advancing carbon impact research and its subsequent implementation into the daily life.
Consumers / Public
Individual consumers play a key role in the proliferation of CNC. If a product’s carbon footprint remains unmitigated or is particularly large, consumers will tend to increasingly avoid purchasing products that generate more carbon emissions. The public’s choice can ultimately drive companies to adopt and develop low impact materials for use in their products and to refine or change their supply-chains’ performance. As product materials and production cycles continue to become less carbon intensive and more efficient, the price to offset individual items will decrease, which will make purchasing such products more feasible for a greater percentage of society.
Where will these actions be taken?
The actions described will typically be taken in two locations: at a company’s corporate offices (for the implementation and execution of the Carbon Neutral Checkout™ program), and in corporate retail stores, or in consumer’s own homes in the form of online shopping. The dichotomy can be identified simply by actions taken on the “supply side,” (actions taken by companies, institutions, and supply chain players) or those taken on the “demand side,” (actions taken by consumers of goods and services and constituents of institutions).
Supply Side Action Locations
Actions taken by corporations and institutions anywhere in the world will mostly be confined to offices where decisions are made. However, it is entirely feasible to anticipate that final numbers collected and delivered to CCC will have come from members of a company’s supply chain in the field (at a factory, a distribution center, or even literally from the field of a farm, for example). As such, this chain of reporting will bring awareness to a larger number of employees within a company or institution about carbon impacts within the company.
Demand Side Action Locations
This, too, is a diverse consideration. There are, of course, retail stores with a large share of consumer-facing operations, and, thus, where a large percentage of Carbon Neutral Checkout™ transactions will take place. However, the proliferation of online shopping and the nature of various services available to the general public for consumption indicate that demand side actions can be taken from within one’s own home, in a public park or building, even at a private location for a wedding, or conference, for example.
While the actions associated with Carbon Neutral Checkout™ will generally be limited to decision making, implementation, purchasing, reporting, and offsetting, there is no limit as to where specifically any of these actions will take place, as every business and individual is different, both in preference and physical location.
What are other key benefits?
Projects that CNC supports are implemented in impoverished rural communities to support local communities and protect the environment.
Company brands gain a strong image of corporate social responsibility to their customers by providing products that transparently have no net-negative impact on the environment. Furthermore, any company adopting CNC can expect to capture a larger market share than without these programs.
The more products that are made carbon neutral through CNC, the more these community-transforming and environmentally beneficial projects will be financially feasible and executed, the more opportunities for work will be afforded to community members. The more communities are positively impacted, the more they will be able to exercise purchasing power as consumers, and can potentially influence demand for more carbon neutral products, which further fuels this cycle of environmental preservation and carbon mitigation.
What are the proposal’s costs?
There are a few costs associated with the program, which consist of direct and indirect monetary costs and opportunity costs.
Direct Costs: There is no charge for the services (i.e. carbon accounting & marketing benefits), which makes Carbon Neutral Checkout™ unique. There are, however, direct monetary costs that are passed on to either consumers, or the adopting company or organization through CNC.
Carbon Neutral Checkout™’s flexible implementation options allow adopting companies to take on offsetting costs directly, which vary depending on the size of the organizations’ carbon footprint. This method of implementation is often only preferable if companies have small footprints or enough of a profit margin to absorb such direct costs.
If costs are passed on to consumers via shelf prices of daily products and services, however, cost increase is usually limited to around 1% per unit. Most estimates conducted for CNC clients and potential clients have ranged from under $0.10 to $1.50 per product or service. We have yet to see a product that costs more than $1.75 to fully offset.
Indirect Costs: Indirect costs associated with adopting CNC are opportunity costs, which manifest in both potential loss of customers due to marginally increased price and loss of work productivity due to time spent on implementation of the program. These indirect costs can also be minimized based on the implementation method. These indirect costs also depend on the unique nature of every carbon footprint – or more specifically, the carbon intensity of every product and service’s value/supply chain. Again, generally the price increase of most products and services is no more than 1%, and in most cases, except for particularly inelastic goods, consumers are able to and are happy to contribute to environmental mitigation if the cost to do so is relatively small.
Short Term: Database and Membership Development.
Enrich the database to support accurate calculations of a product or services' carbon emissions by: 1) Partnering with research institutes and other NGOs to update and broaden the database of CNC, and 2) Keeping track of publicly available resources and data to enrich the database. To grow membership CCC must engage more companies, organizations, and institutions to use CNC.
Within 5 years, CNC will develop within small, medium, and large enterprises. Members will be spread across different sectors, including, but not limited to retail, hospitality, distribution service, and manufacturing. Within 15 years, CNC will have been implemented within enough organizations to drive development of not just the program itself but the socio-economic factors described in the Summary and Key Benefits sections as well.
Medium Term: Maintain and advance development of the micro systems of fundraising and carbon mitigation that in turn create a virtuous circle of interactions between businesses, consumers, and the communities in which projects are implemented.
Carbon Neutral Checkout™ will focus on cultivating micro systems of carbon mitigation distributed throughout society.
At this stage, there will be a fully developed, and continuously evolving network of carbon mitigation activities tied directly to carbon financing through corporate and institutional provision of products and services.
Long Term: Find carbon balance between technology, process, and mitigation through offsets
Eventually, technology and supply chain management, as well as materials sourcing and production will provide sources of overall carbon footprint reduction, and carbon offsets will only be necessary to mitigate a small residual carbon footprint – for absolute zero impact.
A globalized low carbon society should be formed at this stage.
1. Edward B. Roberts, Fiona Murray, J. Daniel Kim, Entrepreneurship and Innovation at MIT, Global Entrepreneurship Institute, Jan 6, 2016,http://news.gcase.org/2016/01/06/mit-report-economic-impact-of-mit-alumni-entrepreneurs(last visited April 5, 2016)
2. Edward B. Roberts, Charles Eesley, Entrepreneurship Impact: The Role of MIT, February 2009, available at https://entrepreneurship.mit.edu/sites/default/files/documents/Entrepreneurial_Impact_The_Role_of_MIT.pdf
3. MIT, Materials Systems Laboratory, http://msl.mit.edu/ (last visited April 5, 2016)
4. Carbon Credit Capital, A Survey on Eco-Consumerism Preference, 2016, available athttp://carboncreditcapital.com/dev/wp-content/uploads/2016/02/CCC-Eco-Consumer-Preferences-Report.pdf