Welcome to our latest ‘Impact’ blog, where we share our views and provide updates on sustainability at Sirius and in the wider commercial real estate industry. In this latest update, I want to focus on a hugely important aspect of our approach to environmental sustainability: how we calculate greenhouse gas emissions across our platform and portfolio – a really important distinction that I’ll explain more below – and how we’re working to reduce these.
This can be a complicated subject, so I’ll start by explaining some concepts and definitions before addressing our performance and approach.
A note on standards
At Sirius we report in line with the GHG Protocol Corporate Accounting and Reporting Standard, a standard that gives guidance to companies on reporting against the seven greenhouse gases covered by the Kyoto Protocol, with the aim of increasing consistency and transparency in greenhouse gas accounting and reporting.
This standard breaks down emissions into three scopes. Scope 1 emissions are ‘direct emissions’: greenhouse gas emissions directly from operations that are owned or controlled by the reporting company, which in the case of Sirius means the energy we use to heat our offices and fuel our company cars.
Scope 2 emissions are ‘indirect emissions’, and pertain to our energy use as a business – meaning the electricity we purchase to run our offices.
Scope 3 emissions are much more comprehensive and are also ‘indirect emissions’, but cover a wider range of emissions that occur in our value chain, namely utility use by tenants at our properties as well as business travel.
Reporting against Scope 3 in particular is often not mandatory, but we do so to help paint the most complete picture of our greenhouse gas emissions – as I’ll elaborate on below, these account for over 90% of our total emissions.
It’s only with this full picture of emissions across the entirety of Sirius’ business that we can take meaningful actions to work against climate change, and bring all our stakeholders with us to maximise impact – we know we’re part of a wider system and can’t just focus on a narrow interpretation of our environmental impact.
Portfolio versus platform
We look at the emissions of our business and operations as a whole, but there is an important distinction to understand between the emissions of our operating platform, and our portfolio of real estate assets.
Our platform means the Sirius operating company, so that’s our headquarters in Berlin as well as our offices at all our assets, company cars, printing, and our own day to day operations.
Our portfolio means the emissions generated by all our assets, including the utilities that are used by our tenants which we supply.
This is something that separates us from many other vendors in that we supply utilities to the majority of our tenants, so they don’t have separate contracts for utilities from various providers.
With that out of the way, we can get into the detail of our performance. From 1st April 2018 to 31st March 2019, our Scope 1 and 2 emissions, those generated by our platform, came to 399.64 tonnes of CO2 equivalent, while from 1stApril 2019 to 31st March 2020 our Scope 3 emissions, the indirect emissions largely generated by tenants across our properties, came to 37,321.67 tonnes of CO2 equivalent.
Those among you with a strong aptitude for maths will notice that the emissions generated by our portfolio far exceed those generated from our platform – in fact well over 90% of our total greenhouse gas emissions are from the operational use of properties by tenants across our sites.
You can find more details and the full breakdown of how emissions arise across our portfolio here.
What we’re doing to reduce emissions
With accurate data, we know where to target our activities to generate the most benefit in terms of reducing greenhouse gas emissions.
Across our portfolio, we now supply 99.4% of the energy used by our tenants from 100% certified green electricity sources, and we’re also putting in place steps to help tenants reduce their own energy use through installing smart-metering, starting with 10% of our portfolio this year and with a target to have smart-metering in place across all our sites by 2027.
Furthermore, we’re helping tenants reduce their own emissions from travel by installing electric vehicle (EV) charging infrastructure across 50% of Sirius sites during 2021, and we’re continuing to look for opportunities to increase coverage across our portfolio.
We are also taking a number of steps to reduce emissions across our platform. All Sirius offices on-site at our assets are supplied with green electricity, and beyond this we have overhauled our printing infrastructure to lower emissions and offset the impact of our printing through forest protection schemes, make use of a carbon neutral parcel shipping service, monitor the carbon emissions of all our company cars and business travel, are shifting our fleet of company cars to more efficient hybrid models, and more.
I’ve touched before on the importance of biodiversity and what we do to improve environmental impact in this key area, and while we can’t yet quantify the impact of this on emissions, we’re conscious of the benefit planting trees and stewarding green space can have on emissions.
Whether big or small, we know that all these steps add up to a larger impact and we’re committed to doing our part in our platform and across our portfolio.
We’re not stopping here, however, and we know there is a lot more work to do to reduce emissions yet further – we’re looking into all options at the moment which fit with our business strategy. For example, an important future step that we’re working on will be reporting on the emissions from purchased materials during construction and maintenance, which will paint an even more complete picture of our overall greenhouse gas emissions and how we can continue to reduce them.
As always, I’d love to hear your thoughts and suggestions.