Carbon Emission Tracking in Procurement

Introduction

Carbon accounting is the process of measuring, reporting, and verifying an organization's greenhouse gas emissions (GHG) and carbon footprint. Businesses can track their impact on the environment and identify areas where they can reduce their emissions. Purchased Goods and services (PG&S) are the single largest emission contributor when it comes to the Scope 3 indirect GHG gas emissions. Usually this captures the GHG emissions of the purchased goods and services. This includes emissions from all the upstream activities of the supply chain from Cradle to Suppliers gate. Understanding the carbon emissions associated with purchased goods and services is crucial for businesses to make sustainable procurement decisions and minimize their environmental impact.

The components

You need to install IFS components of PURCH, EMIPRO, ECOMAN to have this functionality enabled. PURBB component requires to support B2B functionality.

Prerequisites

1. You need to install IFS components of PURCH, EMIPRO, ECOMAN to have this functionality enabled.
2. If the intention is to integrate with third party CLIMATIQ to fetch the emission data, user need to have the API key shared and Routing Rules and Address setup.
3. B2B setup is needed if the supplier directly pushes the emissions value to your IFS applications. Else if the supplier sends the emissions via mail, the user can still enter the values as manual.

Note: When using Third Party integration used for Emission Data, make sure all the Substances in a Substance Group have the same UoM as kgCO2e. And the used Global Warming Potential (GWP) figures are received the Sixth Assessment Report (AR6) produced by the United Nations Intergovernmental Panel on Climate Change (IPCC). (Factors used from AR6 CO2 = 1, N2O = 273 and CH4 = 27.9)

Limitations

1. You need to install IFS components of PURCH, EMIPRO, ECOMAN to have this functionality enabled.
2. If the intention is to integrate with third party CLIMATIQ to fetch the emission data, user need to have the API key shared and Routing Rules and Address setup
3. B2B setup is needed if the supplier directly pushes the emissions value to your IFS applications. Else if the supplier sends the emissions via mails, user can still enter the values as manual.
4. Emissions value covered here is from Cradle to the Supplier’s Gate. The Transport emissions from Supplier’s gate to the Customers’ premises is not covered in this iteration.
5. Emission values from Third Party (Climatiq) for Activity base is not supported for both Parts and No parts.
6. This functionality has not covered Ad-hoc Purchasing, Ad-hoc Purchase Requests, Ad-hoc Purchase Details and Incoming Ad-hoc Purchase Details.
7. The Supplier for Purchase Part is the basic emission storage point here. It will carry forward the emission values towards PR, PO, POCO, Quotation etc. The user cannot override the emission values entered via the Supplier for Purchase Part page in the Purchase Order, Purchase Order Change Order and Quotation pages etc. But when the Quantity or Price changes, the emission value taken from the Supplier for Purchase Part will be adjusted and shown in above objects.
8.  The currency code in the Supplier for Purchase Part and the Purchase Order, Purchase Order Change Order and Quotation pages should be the same to fetch emission data to those above objects in this iteration.

Carbon Calculation Emission Methods

Spend Based

Spend based emission factors estimate emissions based on the monetary value of goods and services purchased by an organization. These factors are calculated by multiplying the organization's spending by the emissions intensity of the goods or services purchased. e.g. CO2 equivalent tons per 1000$

Activity Based

Activity-based emission factors measure the number of emissions associated with a specific activity, such as the number of miles driven by a vehicle, or the amount of electricity used by a facility. e.g. CO2 equivalent tons per kg, ton

Carbon Calculation Emission Sources

Manual

When emissions data are entered Manually by the user.

Supplier

When emissions data are entered directly by the Supplier, registered in the B2B Portal and via the Portal.

Third Party

When emissions data are retrieved from a Third-Party (Climatiq) database.

API Key Sharing with customers

IFS will create a Project at Climatiq for each customer and add the user at the customer as a project member and his mail address to the Project. The customer will then receive the API key via an email. When a customer copies this API key to the IFS cloud/Routing Rules, they can access the Climatiq database to get emission details.

Routing Rules and Address setup

1. IFS Connect configurations for Climatiq Procurement REST Endpoint, please refer Technical Documentation IFS Connect for Climatiq Integration for Carbon Emissions Tracking in Procurement - Technical Documentation For IFS Cloud for more information.
2. IFS Connect configurations for Climatiq Autopilot REST Endpoint, please refer Technical Documentation IFS Connect for Climatiq Integration for Carbon Emissions Tracking in Procurement - Technical Documentation For IFS Cloud for more information.

 Regions List

Climatiq Co-pilot Integration for the No Part

For No-part, if the user expects to get the Spend based emission values from the Third Party; Climatiq then use IFS integration with the Copilot at Climatiq's end to get results. You will get values with a Confidence Score. To receive values with a higher confidence score, user needs to re-try with more elaborative descriptions for the No-Part Description.

Features

System Defined Substance Group and Substances

System defined Substance Group and Substances have been added to aid the Carbon Emission Tracking process in procurement. The basic Substance Group, GHG - Greenhouse Gases and Substances CO2, CH4 and N2O along with the Cumulative Substance CUMCO2E has been predefined in the basic data setup. The user will be able to use these to start the carbon emissions process swiftly. Before using, the user must ensure the UoM of all substances must have been set to kgCO2e in the Substance page.

Supplier for Purchase Part & Supplier for Purchase Parts

A new tab in Supplier for Purchase Part, Emissions have been added to set up the basic data for each Supplier for Purchase Part. The Supplier for Purchase Part will feature the Total Emission value column to view and compare the emissions values of each Supplier for Purchase Part at a glance.

Supplier for Purchase Parts Emissions Overview

This page acts as the main overview page of the Supplier for Purchase Part, Emissions tab. Users will have the ability to bulk update mulitple substances from sources Third-Party and Supplier here.

B2B Portal; Open Requests, Submitted Requests

The users will have the ability to request emission details from B2B Suppliers. B2B supplier has the ability to Submit data thorugh the B2B portal to their B2B Customers using Open Requests page and view submitted requests on the Submitted Requests page through the Request for Emissions lobby element.

When entering emissions for Activity Basis from sources of Manual or Supplier, please make sure that you enter emission values per purchase unit that is mentioned in the Supplier for Purchase Part.

Purchase Requisition(s), Purchase Part Price Comparison, Purchase Requisition Lines, My Purchase Requisition Line Authorization and Purchase Requisition Line Authorization

In the Purchase Requisitions, Total Emissions is available for the user, and it is not possible to edit this field.

In Purchase Part Price Comparison, the user can only see Emissions Per Unit and Emissions Calculation Method in here and it is not possible to edit.

The emissions parameters of Emissions, Emission Calculation Method, Emissions per Unit, Default Source for Emission, Third-Party Description, Emission Remarks, and Emission Modified Date will be available on the Purchase Requisition Lines, Purchase Requisition Line Authorizations, and My Purchase Requisition Line Authorizations line level where the user will be able to see the Emission related info only and it is not possible to edit the above fields. These facilities are for the authorizer to decide on the authorization whether it meets the business requirement with emissions.

Purchase Order(s), Purchase Order Lines, My Purchase Order Authorization

In the Purchase Orders and My Purchase Order Authorizations, Total Emissions is available for the user, and it is not possible to edit this field.

The emissions parameters of Emissions, Emission Calculation Method, Emissions per Unit, Default Source for Emission, Third-Party Description, Emission Remarks, and Emission Modified Date will be available on the Purchase Order Lines line level where the user will be able to see the Emissions info and it is not possible to edit the above fields. These facilities are for the authorizer to decide on the authorization whether it meets the business requirement with emissions.

Purchase Order Change Order(s), Purchase Order Change Order Lines and Invoiced Purchase Orders

In the Purchase Order Change Orders, Total Emissions is available for the user, and it is not possible to edit this field.

The emissions parameters of Emissions, Emission Calculation Method, Emissions per Unit, Default Source for Emission, Third-Party Description, Emission Remarks, and Emission Modified Date will be available on the Purchase Order Change Order Lines, and Invoiced Purchase Orders level where the user will be able to see the Emissions info and it is not possible to edit the above fields. These facilities are for the authorizer to decide on the authorization whether it meets the business requirement with emissions.

Spend Analysis​

If the user has included emissions for the Analysis ID when generating the spend analysis, the emissions-related parameters of Emissions, Emissions Calculation Method, and Default Source of Emission will be available according to the line-wise of the used source.

Order Quotation, Quotation Lines, Order Quotation Approval(s)

In the Order Quotation, Emissions, Emissions Per Unit, Default Source of Emission, and Emissions Calculation Method are available for the user, and it is not possible to edit these fields.

The emissions parameters of Emissions, Emission Calculation Method, Emissions per Unit, Default Source for Emission, Third-Party Description, Emission Remarks, and Emission Modified Date will be available on the Order Quotation Lines, Order Quotation Approval, and Order Quotation Approvals level where the user will be able to see the Emission related info only and it is not possible to edit the above fields. These facilities are for the authorizer to decide on the authorization whether it meets the business requirement with emissions.

Agreement Quotation, Agreement Quotation Lines, Agreement Quotation Approval(s)

In the Agreement Quotation, Emissions, Default Source of Emission, and Emissions Calculation Method are available for the user, and it is not possible to edit these fields.

The emissions parameters of Emission Calculation Method, Emissions per Unit, and Default Source for Emission will be available on the Agreement Quoation Lines, Agreement Quotation Approval, and Agreement Quotation Approvals level where the user will be able to see the Emission related info only and it is not possible to edit the above fields. These facilities are for the authorizer to decide on the authorization whether it meets the business requirement with emissions.

Create Order Quotation, Quotation Details, Quotation Details Assistant and Quotation Lines pages – B2B

B2B Supplier will be able to view carbon emissions in their ongoing quotations. However they will not be able to add/send new emisisons details to customers through the standard quotation process.

Create Agreement Quotation, Agreement Quotation Details, Agreement Quotation Lines – B2B

Similar to the Order Quotation, the B2B Supplier will not have the ability to add/send emissions details to the customer with the Agreement Quotations.