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Carbon Allocation 

MLGW does not generate power; instead, we buy power from the Tennessee Valley Authority (TVA) and distribute it to our local customers.  TVA has reduced CO2 emissions about 47% below 2005 levels and is projected to reduce CO2 emissions nearly 60% below 2005 levels by 2020.  This means that carbon footprints associated with MLGW customer electricity use have declined as well.  Carbon accounting users will still need to quantify their Scope 2 emissions associated with electricity use for CH4 and N2O using their choice of default factors for these gases. 

Understanding Carbon Emissions

Many companies publicly disclose carbon performance every year, much like disclosing financial information.  That’s why the CO2 emissions rate of the energy resources used is increasingly important to companies, many of whom are complying with voluntary corporate carbon accounting standards. 

Generally, there are three categories of CO2 emissions that companies calculate, similar to debits and credits in financial accounting.  

  • Scope 1 covers direct emissions, what most people picture as coming out of a manufacturing plant’s smokestack or vehicle tailpipe into the air. Alternative transportation fuels (including electrification and compressed natural gas) are options for those looking to reduce Scope 1 emissions.
     
  • Scope 2 is one form of indirect emissions, dealing with energy purchased for on-site consumption.   Energy efficiency improvements, as well as renewable power purchases, can reduce indirect Scope 2 emissions.
     
  • Scope 3 is the second form of indirect emissions, representing the supply chain of a particular company.  It addresses the indirect upstream and downstream transportation and materials for all the pieces and parts that go into the product made, including the electricity that businesses use to manufacture products.  Energy efficiency, renewable power purchases and alternative transportation fuels are all options that suppliers can use to reduce indirect Scope 3 emissions.


Carbon Emissions Factor
TVA has provided the following information to assist MLGW customers in understanding the carbon emissions associated with their power consumption.  This data reflects the average for the 154 local power companies that distribute TVA power—including MLGW—and is based on consumption for commercial customers on the “general power rate,” which is shown as “E-2” on the MLGW bill.  CO2 emissions data for larger commercial and industrial customers on other electric rates is excluded from this average.  (Customers not on the “general power rate” should contact MLGW for their carbon emissions data, which will vary from the number shown below.)

MLGW calendar year (CY) 2017 as-delivered CO2 emission rate average for customers on the general power rate is 864.12 CO2 lbs/MWh.  The CO2 rates disclosed reflect TVA's 2017 renewable energy credit adjustment, which resulted in an insignificant impact (0.001%) in the CO2 lbs/MWh rate.  The current EPA eGRID (Year 2016) national CO2 lbs/MWh rate is 998.40 and regional CO2 rate is 1,185.40.


Consistent with generally accepted voluntary carbon accounting standards and in response to customer requests, actual CO2 emissions have been annually allocated to customers in the same manner as costs. MLGW CY17 CO2 lbs/MWh rate includes emissions and generation from TVA-owned and purchased power.

If a customer has purchased and retired Renewable Energy Certificates (also called Renewable Energy Credits, or RECs), the associated MWh volume (1 REC = 1 MWh) should be subtracted from the total MWh consumed, then multiply the emission factor times the remaining MWh to calculate the total electricity Scope 2 CO2 lbs.  The same calculation should be used if a customer participates in TVA’s Green Power Switch program, where TVA retires the RECs on the customer’s behalf.  (6.67 Green Power Switch blocks = 1 MWh)

Additional Resources on Carbon Accounting