Introduction to JD Edwards EnterpriseOne Environmental Accounting and Reporting

Introduction to JD Edwards EnterpriseOne Environmental Accounting and Reporting

JD Edwards EnterpriseOne Environmental Accounting and Reporting enables organizations to track their greenhouse gas (GHG) emissions and other environmental data against reduction targets and facilitates environmental reporting for both voluntary and legislated emissions reporting schemes.

JD Edwards EnterpriseOne Environmental Accounting and Reporting (EAR) enables organizations to record environmental data such as energy consumed or energy generated at facilities or locations within the enterprise. The EAR application automatically calculates corresponding greenhouse gas (GHG) emissions resulting from the use of sources of emissions. Capturing environmental data helps companies monitor emissions against pre-established targets or thresholds to identify opportunities for cost and emission reduction. Recording this data also helps organizations comply with mandatory or voluntary global environmental reporting needs.

As an extension to JD Edwards EnterpriseOne, EAR provides built-in applications to capture environmental data, calculate GHG emissions and pre-built dashboards and reports to:

Key features of EAR that allow you to achieve the above benefits are:

Greenhouse Gas Accounting and Reporting

The following sections provide a brief description of the greenhouse gas effect, regulations for GHG accounting and reporting, and the GHG Protocol.

Greenhouse Gas Effect and Global Warming

The Earth reflects the infrared radiation that it receives from the sun. Certain gases called greenhouse gases, in the higher layers of the Earth’s atmosphere absorb some of the reflected radiation and radiate it back to the Earth’s lower atmospheric layers, which help keep the planet at a temperature that is suitable for life. This process by which some thermal radiation is absorbed and then re-radiated by atmospheric gases back to a planet to keep it warm is called the greenhouse gas effect. Carbon dioxide, water vapor, methane, and ozone represent the major greenhouse gases.

The concentration of the green house gases is increasing because of increased industrialization and burning of fossil fuels. These activities increase the thermal radiation absorption by the greenhouse gases, thereby increasing the Earth’s temperature which results in global warming.

Global Requirement for Greenhouse Gas Accounting and Reporting

Increasing awareness of the environmental dangers of global warming has encouraged both developed and developing nations to agree on standards for accounting and reporting greenhouse gases.

The Kyoto Protocol developed under the United Nations Framework Convention on Climate Change (UNFCCC) aims at fighting global warming caused by increasing atmospheric concentrations of the following greenhouse gases: carbon dioxide, methane, nitrous oxide, sulphur hexa fluoride and two groups of gases, hydrofluorocarbons and perfluorocarbons.

Regulations for GHG Emissions Accounting and Reporting

Many countries now have their own laws that mandate greenhouse gas emissions accounting and reporting. For example, in the United States of America, the U.S. Environmental Protection Agency (EPA) published a rule 40 CFR part 98 that mandates greenhouse gases (GHG) reporting from large GHG emissions sources.

In California, the Assembly Bill 32: Global Warming Solutions Act was introduced by the California State Law that fights climate change by establishing a comprehensive program to reduce greenhouse gas emissions from all sources throughout the state. This bill requires that the California Air Resources Board (CARB) develops regulations and mechanisms to reduce California's greenhouse gas emissions to 1990 levels by 2020.

In Australia, the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) introduced a national framework for the reporting and declaration of information about GHG emissions, GHG projects, and energy use and production of corporations.

The United Kingdom introduced the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme that aims at improving energy efficiency and cutting emissions in large public and private sector organizations. The scheme is designed to reduce CO2 emissions not already covered by Climate Change Agreements (CCAs) and the EU Emissions Trading Scheme.

Voluntary Emissions Reporting

Today, many environmentally and socially aware organizations are voluntarily participating in emissions disclosure projects. For example, many organizations across the globe are participating in the Carbon Disclosure Project (CDP) that was introduced in the United Kingdom. Through CDP, major economies measure and disclose their greenhouse gas emissions, climate change strategies, and water usage.

GHG Protocol – Global Standard for GHG Accounting and Reporting

An increasing number of industries and organizations are now adopting environmental emissions accounting and reporting tools, and applications based on the Greenhouse Gas Protocol to understand their emissions profiles and potential GHG liabilities. The Greenhouse Gas Protocol (GHG Protocol) was convened by the World Resources Institute and the World Business Council for Sustainable Development and is used as an international accounting tool to measure, account, and manage greenhouse gas emissions. The GHG Protocol also serves as an accounting framework for all GHG standards and programs globally.

The JD Edwards EnterpriseOne Environmental Accounting and Reporting (EAR) application is based on the standards prescribed by the GHG Protocol. EAR lets you maintain location specific energy factors to determine the energy content in gigajoules (GJ) and GHG emissions in kilograms (KG) of carbon dioxide equivalents based on the usage of environmental sources that cause GHG emissions. This information is stored in the Environmental Ledger and is used for reporting through pre-built Oracle Business Intelligence Dashboards and Reports.

Note: Although the Environmental Ledger stores GHG emissions in kilograms (KG), EAR enables you to choose a desired Unit of Measure, such as a ton (T), for reporting and viewing GHG emissions in the pre-built Oracle Business Intelligence dashboards. For more information, see: Configuring the Emissions Reporting Unit of Measure Used in Dashboards.

Recording and Reporting Other Environmental Data

You can also configure the JD Edwards EnterpriseOne Environmental Accounting and Reporting (EAR) application to capture and analyze environmental data that is useful to an organization for tracking multiple environmental metrics. Metrics include:

EAR enables you to compete in the global market and facilitates transforming your organization into an environmentally responsible organization.

Technology Overview

JD Edwards EnterpriseOne Environmental Accounting and Reporting uses the following Oracle technologies:

Environmental Accounting and Reporting

The following diagram provides an overview of the JD Edwards EnterpriseOne Environmental Accounting and Reporting application's architecture:

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JD Edwards EnterpriseOne Environmental Accounting and Reporting (EAR) integrates with JD Edwards EnterpriseOne Accounts Payables and JD Edwards EnterpriseOne Inventory Management and enables you to perform environmental accounting for various transactions. EAR integrates with Accounts Payables (AP) and captures source usage data related to Accounts Payables vouchers and suppliers of products that have environmental impact. You can also perform environmental accounting related to AP Vouchers. EAR also integrates with Inventory Management, and captures usage data using the miscellaneous transactions involving issue of items with environmental impact to assets. The usage data is collected by the Emission Calculation business function, which calculates the energy and carbon equivalent emissions by applying energy and emission factors and stores the information in the Environmental Ledger. The Environmental Ledger stores the GHG emissions in kilograms (Kgs) of CO2 equivalents and the energy in gigajoules (GJ) for each source. Depending upon the date range of the transaction, energy and emissions are equally apportioned across all the days that fall in the specified effective data range.

EAR leverages Oracle Data Integrator (ODI) to transfer the data from the Environmental Ledger to the Environmental Data Warehouse. The Oracle Business Intelligence application uses the data for environmental reporting through the pre-built dashboards and reports.

EAR integrates with JD Edwards EnterpriseOne Capital Asset Management and enables you to identify transactions involving the issue of items with environmental impact to an asset. You can also define assets within EAR if you are not using the JD Edwards EnterpriseOne Capital Asset Management application. Refer to the “Defining GHG Assets and Subcontractors” topic of the Setting Up chapter for more information.