Accounting for a product's carbon footprint is a costly endeavor since it requires tracing the ingredients all the way back in the supply chain. According to 3M that makes over 55,000 products, this can cost $30,000 for a single product. Carbon labels have yet to receive a wide-spread recognition by consumers. Based on a survey conducted by Which?, a British consumer group, just a fifth of British shoppers recognized the carbon footprint label, compared with recognition rates of 82% for Fairtrade and 54% for organic labelling. Furthermore, the issue of carbon-footprint labelling has become confusing due to different carbon footprinting and labelling standards that have emerged in different countries.
Although carbon labels are expensive, lack standardization across countries, and are not yet well recognized by consumers, there are some encouraging signs of progress in this direction.In Britain, the sale of carbon labelled products exceeded 2 billion pounds, which was more than the sale of organic products (1.5 billion pounds) and Fairtrade products (800 million pounds). This trend is due to Tesco's initiative of carbon labelling more than 100 of its own brand products, including pasta, milk, orange juice and toilet paper. (In 2007 Tesco had said that it will carbon label all of its 70,000 products. So far they have managed to label 500 products).
Historical evolution of carbon-footprinting:
Among the first products to have carbon labels applied were the cheese-and-onion potato crisps made by Walkers (a brand owned by PepsiCo). Carbon Trust estimated the footprint to be 75 grams per packet. It is important to note that carbon labels are not restricted to carbon dioxide emissions, but also considers other greenhouse gases. These gases are converted into "carbon-dioxide equivalent" (for example, 1g of methane is expected to have the same global-warming potential as 21g of carbon dioxide. The process of quantifying the carbon footprint helped Walkers to identify opportunities for saving money and energy by switching to buying potatoes by dry weight. Walkers was able to reduce frying time by 10% and farmers were able to avoid the cost of humidification.
For many products carbon labels should include not only manufacturing footprint but also "use phase emissions" (e.g. shampoos, flat screen LCD television, jeans). In such situations, consumer behavior can make a big difference to the use phase emissions. For instance, washing Levis Strauss 501 jeans in cold water and drying them on a line can reduce the use phase emissions by 90% (the use phase emissions associated with washing 501 jeans with warm water and maching drying them constitute 57% of its carbon footprint).
Towards comparability between carbon labels on similar products:
There has been a call for standardizing product-category rules between countries to ensure compatibility between carbon-labelling schemes. In Japan the Ministry of Economy, Trade and Industry (METI) launched a program in 2008, which has signed up more than 300 retailers and has established product-category rules for 53 products. South Korea's environment ministry has introduced a "Cool label," for over 220 products. Similar initiatives have been undertaken in other countries. France is leading this effort and the initiatives by French retailers are being backed by government action. In June 2011, France embarked on a year long experiment, involving 168 firms in a range of industries to apply carbon labels to products. This is expected to be the basis for the compulsory carbon labellng rules to be introduced as early as 2012. The rules will apply to both imported as well as for goods made in France. Dependeing on the products, the label is expected to include information about water footprint as wll as impact on biodiversity. The project is an outcome of Grenelle 2 law passed in 2010 which marks the first time a government has tried to make environmental labelling mandatory. Other European countries are closely watching the French project to formalize their own carbon labelling approaches.
The British Standard PAS 2050, which was established in 2008, has also been very influential in harmonizing carbon footprinting and labelling at a global level. The standard has also helped shape ISO 14067 and GHG Protocol (a project backed by two environmental lobby groups, the World Resources Institute and the World Business Council for Sustainable Development. The ISO Standard is expected to be finalized in 2012 and the GHG Protocol standards were released in 2011. Cooperation between the two bodies should ensure that their standards are highly compatible.
One of the key unresolved issue relates to considering the carbon footprint in the entire supply network. For many firms a large portion of carbon footprint resides upstream in the supply chain. For example, Gold'n Plump Poultry, a large American chicken producer, found that its own operations accounted for only 22% of the footprint of each chicken and 50% of the footprint came from the production of corn- and soya-based chicken feed. Tesco, a retailer, reckons that is supply chain produces ten times the emissions of its direct operations (heating and lighting stores and offices) and that consumer emissions may be ten times as big again. Wal-Mart estimates that 90% of its emissions emanate from its supply chain of over 120,000 companies. It would thus be necessary to work closely with suppliers and encourage them to collaborate and pool expertise to streamline the footprinting process.
Source: Following the footprints. The Economist Technology Quarterly, June 4th 2011.