Tuesday, August 25, 2009

Briefing Note: Planet Metrics – Helping Firms Quantify the Cost of Carbon in The Supply Chain

Based in California, Planet Metrics is a new venture-backed, software company, which enables companies to model, visualize, and manage carbon reduction efforts throughout a supply chain. The company has an experienced management team and an impressive advisory board which includes Adam Lowry, Method Home founder; Monique Oxender, Global Manager for Supply Chain Sustainability at Ford; and Tyler Elm (formerly of Walmart's sustainability team).

Planet Metrics has a large database, including GHG, product LCA, and energy and fuel data—and—a library of publicly available and licensed scientific data including EcoInvent, a popular process LCA platform. They also have extended the EIO-LCA data model developed by Carnegie Mellon University. By combining this extensive data with proprietary data from within a customer’s organization, such as bills of material and cost of goods, Planet Metrics can model extensive carbon footprints across product lines. Importantly, the software tool is designed for ease of use so it can be used may many people through the enterprise, not just highly technical product specialists.

The target customer is very large companies with complex products and extensive supply chains.

The company is in pilot with a number of large companies. One problem addressed is quantifying the embedded cost of carbon in products and supply chain for purchasing, product designers and supply chain managers. A Global 50 manufacturer is using their software to quantify the effect different scenarios of oil prices and carbon tax on their cost structure. This analysis helps engineers and supply chain managers indentify carbon "hotspots" such as which suppliers and part numbers are effective the most in scenarios of increased cost of carbon and energy. Another company aims to quantify the cost of carbon as a % of COGS.

At a high level, Planet Metrics offers similar tools as traditional LCA vendors like PE International (GaBi) and Pre (SimaPro); Other new entrants like Climate Earth, Sustainable Minds, SAP Impact (formerly Clear Standards) Carbon View among others, provide carbon accounting tools as well.

Planet Metrics software is easy to use by all people within the organization as they make their daily decisions to plan carbon limits and save on costs. Where LCA models have really counted on scientists to come up with the magic number for the product line managers

The screen shot below shows the overall carbon picture of a cleaning product.

With the increased importance of sustainability in the supply chain and the product design process, Planet Metrics brings new tools and ideas to the market.

1 comment:

Anonymous said...

Not so fast. One of many companies with no clear vision and no domain expertise in the space (similar to Hara and C3). Most of these guys come from software side thinking of making a quick $$$. There are no drivers for this type of business model at this time as it is witnessed by absence of customers. I beleive many of VC startups will not make it in this space, including Planet Metrics, as sales cycle is long and financing will dry up. Some of established players such as SAP, ESS, Locus or Enviance have already cornered this market.