Stagecoach Group has undertaken a three-year Carbon Management Programme (CMP), launched in December 2008, to provide a strategic approach to assessing the impact of climate change.

The CMP identifies short, medium and long-term risks and commercial opportunities to the business. It will ensure the Group meets its regulatory obligations, reduces its carbon emissions, cuts energy costs and enhances its corporate reputation.

A key element of the plan involves regular monitoring of performance across our bus and rail operations. We have pledged to report annually through our website on our global carbon footprint, as well as by voluntary disclosure to the Carbon Disclosure Project, the world's largest corporate greenhouse gas emissions database.

We have put in place a robust, consistent system for measuring and monitoring carbon emissions and we will also report on performance against a set of reduction targets across the whole business.

Stagecoach Group baseline global carbon footprint

Detailed analysis has been carried out in each of the Group's divisions - UK Bus, UK Rail, Coach USA and Coach Canada - to establish the Group's baseline global carbon footprint. This data, for financial year 1 May 2007 to 30 April 2008, will be used as the basis for future improvement and specific targets for our individual divisions.

We have used reporting methodology from the World Business Council for Sustainable Development and UK and US Government factors for determining CO₂ emissions. Emissions covered are:

• Scope 1 - Direct Emission on site and from company-operated vehicles
• Scope 2 - Indirect Emissions, including electricity generated and supplied through the national grid and electric current for traction.
• Scope 3 - Other Indirect Emissions. This covers emissions resulting from business travel (road, rail and air) as well as emissions resulting from waste disposal, such as landfill gas emissions. It excludes transport of waste to recycling or landfill and the recycling process or related down-stream emissions. Emissions resulting from staff commuting from home to work are also not included in the Scope 3 data.

Based on the above methodology, the Stagecoach Group Global Carbon Footprint breakdown (tonnes of CO²e) for financial year 1 May 2007 to 30 April 2008 is as follows*:

* Note: the information above has been restated to reflect improved data gathering and updated emissions conversion factors provided by Defra and the Department for Energy and Climate Change in the financial year 2008-09.

To put the above data in context, one tonne of C0₂ is equivalent in energy it takes to:

• boil water for 93,023 cups of tea
• drive 2,874 miles in a medium sized petrol car,
• leave a 60W light bulb on constantly for nearly 4.5years.
• power an average home for 10 weeks.

As expected from a Group delivering public transport services powered largely by fossil fuels, around 90% of the Group's carbon footprint is from its bus and train fleet operations. Approximately 7% is generated from buildings, with the remainder split between waste, business travel and other emissions.

Stagecoach Group carbon footprint, 2008-09

The Stagecoach Group carbon footprint data for the financial year 2008-9 is listed below.

Carbon footprint trends

As can be seen from the data above, there is an absolute increase of 5.7% in the Group's carbon footprint. However, this does not take account of changes within the business, particularly the first full year of carbon emissions data from East Midlands Trains.

A measure called Carbon Intensity (total emissions divided by turnover) is regarded as a more meaningful method of year-on-year comparisons. Consistent with the Carbon Trust Standard, Scope 1 and Scope 2 emissions (building and fleet energy) have been used for this purpose. This reflects the fact that the collation of refrigerant and Scope 3 emissions data is still developing across the Group.

A breakdown of the carbon intensity trends across the Group are provided in the table below.

Carbon Intensity Trends by Division (tonnes CO₂eq/£M)

* includes Group HQ

Key trends identified in the data:

• UK Bus - a significant reduction in total emissions and carbon intensity, assisted by the virtual elimination of solvent cleaner. While road fuel consumption has increased, using more biodiesel has helped in this major category.
• UK Rail - there have been improvements in the reporting of refrigerant, solvents and Scope 3 items. Increased overall emissions reflect the first full year contribution at East Midlands Trains. In addition, while South West Trains site electricity has reduced, emissions from SWT traction electricity have increased.
• United States - Total emissions have reduced as a result of lower diesel consumption and significantly lower heating gas, while electricity has increased. The significant reduction in carbon intensity is largely driven by exchange rate movements.
• Canada - the absolute increase is largely due to increased fuel consumption, offset in part by lower levels of recharging on fleet air conditioning. The significant reduction in carbon intensity is largely driven by exchange rate movements.

Current KPIs and Targets

Stagecoach Group is putting in place a series of key performance indicators to track the impact of our strategy on the ground and help drive improvement across our business. We will set stretching targets for the short-to-medium term as well as continuing to work with other stakeholders on longer-term solutions that will contribute to global action on climate change. Our KPIs and targets will be finalised in autumn 2009 and published here.

Historic data

Stagecoach Group previously tracked a number of environmental measures specific to each of its operating divisions. At the heart of this approach was a commitment to continuous year-on-year improvement, with a focus on moving annual averages.

Details of our performance for 2007-08 are available here.

Details of our performance for 2006-07 are available here.

Details of our performance for 2003-04, 2004-05 and 2005-06 are available here.

Continuous improvement

We believe we have made significant progress and investment in the sustainability of our business in recent years and we are proud of what our people have achieved. However, we are very much aware that the challenge of climate change remains significant.

Stagecoach Group remains committed to building on the progress we have made so far and working with our partners and the local communities we serve to make further improvements. We would welcome your feedback on our strategy and performance. You can email your comments to environment@stagecoachgroup.com.