The publication “Quality Infrastructure and Sustainability Standards” outlines the role of quality infrastructure in translating sustainability standards into practical and verifiable requirements. Public and private sustainability standards define ecological and social benchmarks that help distinguish sustainable from unsustainable products, support responsible business practices, and reduce risks along global value chains.

The report describes how companies — in particular small and medium-sized enterprises in developing and emerging economies — often face a complex landscape of sustainability standards, varying compliance requirements, and limited access to local testing, certification, and accreditation services. It explains how a well-functioning quality infrastructure system, covering metrology, standardization, conformity assessment, and accreditation, can help address these constraints and facilitate the practical application of sustainability standards.

Using examples from countries such as India, Indonesia, Ecuador, and Egypt, the publication illustrates how improved quality infrastructure can support businesses in meeting sustainability standards more efficiently, increase confidence among international buyers, and improve access to global markets. It also points to broader contributions to sustainable economic development, improved labour practices, and environmental protection.

Download the report (PDF):
https://www.ptb.de/cms/fileadmin/internet/fachabteilungen/abteilung_q/q.3_internationale_zusammenarbeit/publikationen/PTB_Compact_QI_Nachhaltigkeit_DE.pdf

However, while the green hydrogen sector features prominently on political and strategic agendas, less than 1% of global hydrogen production in 2021 was based on low-emission technologies. This emergent sector offers great potential therefore in terms of decarbonization and will create fresh economic opportunities for stakeholders along its entire value chain.

Overall, there needs to be a swift, significant increase in renewable energy generation so that the surplus can be used to produce hydrogen. That goes hand-in-hand with the expansion of the hydrogen infrastructure (electrolyzers, storage, transportation and usage) and the development of new applications to drive demand.

A new study by Ferdinand Consultants for Germany’s National Metrology Institute, the Physikalisch-Technische Bundesanstalt (PTB), explains how quality infrastructure creates the basis for the development of the green hydrogen sector by reducing existing risks and supporting the positive sustainability impact of investments.

Quality infrastructure comprises the public bodies, private companies, regulatory and legal frameworks of the value chain. It relies on the components of metrology, standardization, testing, accreditation, conformity assessment, and market surveillance.

Robust, internationally recognized criteria and quality assurance mechanisms must be put in place to prevent technical barriers to trade, green washing and unintended negative sustainability or local economy impacts. This is especially relevant in Africa and Latin America, whose abundant renewable energy sources make them ideal green-hydrogen producers.

There are significant challenges to be addressed across a number of quality infrastructure services. For example, there is a need for clear, internationally recognized criteria for life-cycle assessments to estimate emissions releases and any negative environmental impacts. Another important area is the “guarantee of origin” required to differentiate green hydrogen from other hydrogen types.

The publication examines the existing gaps between the demand, both current and projected, and supply of quality infrastructure services. It also sets out key learnings to help policymakers and sector stakeholders effectively support quality infrastructure and foster the development of the green hydrogen industry.

Contact us for more information on our activities related to green hydrogen and quality infrastructure. 

We are delighted to announce the launch of our new brand.

netpositive develops tailor-made solutions for our clients that go beyond compensation strategies by creating net positive sustainability projects in Spain.

At netpositive, our initial focus is the hands-on development of innovative photovoltaic projects in Spain, where the renewable energy industry is thriving. These projects offer carbon emission compensation to our clients whilst making tangible environmental, economic and social impact for local communities.

Besides photovoltaic solutions, netpositive also creates projects to respond to the growing water scarcity in Spain, protecting biodiversity and removing carbon from the atmosphere.

netpositive is a group of leading experts uniting strategic understanding, innovation and local know-how for real sustainability impact. We draw on over 15 years of experience in corporate sustainability strategies, development of renewable energy projects, financial and legal advisory, biodiversity, local sustainability initiatives and quality assurance.

Contact us for more information on netpositive: info@netpositive.es

In many countries, the reputation of photovoltaic (PV) technology has suffered from negative experiences that occurred when safety, quality and sustainability aspects were not sufficiently addressed. Although PV is often perceived as easily deployable, special expertise is necessary throughout all phases of a PV project to ensure the correct functioning of the system and the long-term success of the project. The required know-how and experience can only be accumulated over time. In countries where PV development is comparatively recent, the sector finds itself at an early stage of the learning curve, and safety, quality and sustainability issues are more common. This is the case for many developing and emerging economies. Nevertheless, many of the challenges are also relevant in industrialized countries and need to be addressed to further develop the PV sector, such as:

• Installation faults, which are common worldwide due to unqualified personnel and lack of training. Such faults can cause serious defects in photovoltaic plants, impacting safety, performance, and financial returns.
• Quality gaps and low-quality imports in emerging and developing economies.
• Lack of reliable solar irradiation data required for successful plant planning.
• Water stress in arid zones due to the use of water to clean PV modules.
• High resource use and waste generation, especially as more systems reach their end-of-life stage.

Quality infrastructure is the system comprising the organizations (public and private) together with the policies, relevant legal and regulatory framework and practices needed to support and enhance the safety, quality and environmental soundness of goods, services and processes. The development of this system helps to overcome existing challenges and facilitate the wider use of PV energy.

Based on the unique experience gained in projects implemented by PTB in emerging and developing economies in Africa, Latin America and Asia, the study describes case studies and recommendations pertaining to the development of the quality infrastructure. It includes general recommendations, describes requirements for specific quality infrastructure services, and highlights aspects to be considered within specific national contexts.

The study shows that it is crucial – especially in developing and emerging economies – to support the national quality infrastructure alongside the development of the PV sector. By following the recommendations for action in this area, sector organisations, policymakers and quality infrastructure institutions can lay the foundations for the sustainable growth of this sector.

Download the pdf:  https://www.ptb.de/cms/fileadmin/internet/fachabteilungen/abteilung_9/9.3_internationale_zusammenarbeit/publikationen/Studies/PTB_study_QI_for_PV_EN.pdf

Niels Ferdinand and Catrina Heider

Bringing sustainability reporting closer to financial reporting

On 28th November 2022, the EU Council gave the final green light on the CSRD, a new landmark legislation that greatly expands the scope of sustainability reporting requirements for companies operating within Europe.

Compared to the 2014 Non-Financial Reporting Directive (NFRD), the CSRD:

• Extends the number of companies that are required to report from 11,000 to nearly 50,000.
• Introduces the concept of double materiality, requiring companies to focus on sustainability matters related to their relevant impacts (inside-out) and relevant financial risks and opportunities (outside-in).
• Defines more detailed reporting requirements specified in the European Sustainability Reporting Standards (ESRS).
• Includes mandatory information on climate change, in line with the EU´s climate goals.
• Requires assurance on a company´s reported sustainability information and of the reporting process.
• Introduces digital accessibility and tagging, in accordance with the European Single Electronic Format (ESEF/XHTML) regulations.

The current version of the CSRD improves important shortcomings of the NFRD. It considers stakeholder feedback on previous draft versions, enhancing reference to existing standards such as the Global Reporting Initiative (GRI) and making the requirements easier to understand.

The introduction of the CSRD is a major step in fostering a more sustainable economy in the EU. Eligible companies are required to systematically measure and manage their social, environmental and economic impacts, identify related financial risks and opportunities, develop corresponding strategies and objectives, and report to stakeholders about their performance based on common requirements. This will lead to a better integration of sustainability into business models and to an increased consideration of sustainability information in stakeholder decisions. B2B customers, banks and shareholders increasingly ask for this kind of information. Through the CSRD, they will have access to more reliable information to evaluate and compare sustainability performance between different companies.

Application and implementation timeline

The application of the CSRD is dependent on the company type and size, and will be rolled out progressively in four stages between 2024 and 2028, as follows:

1. Reporting in 2025 on the financial year 2024: Companies already subject to the NFRD.
2. Reporting in 2026 on the financial year 2025: Large companies (>250 employees, > €40 million turnover and/or €20 million assets) not subject to the NFRD.
3. Reporting in 2027 on the financial year 2026: Listed SMEs (except micro undertakings), small and non-complex credit institutions.
4. Reporting in 2029 on the financial year 2028: International companies with net turnover > €150 million in the EU.

The specific reporting requirements are defined in the first set of the European Sustainability Reporting Standards, published by the European Financial Reporting Advisory Group (EFRAG) in November. They are expected to be adopted by the EU Council on June 30^th, 2023.

Gearing up for the new rules

The timeframe of the introduction of CSRD could imply this is not a concern for today. However, from our experience and understanding of the significant new requirements the CSRD establishes, there are important reasons for companies to begin now.

A timely preparation will allow companies to implement and test their strategies, processes and structures internally before being required to publish the related information. Furthermore, several steps must be taken to prepare for reporting according to CSRD, including the following:

• Apply the materiality approach, including the financial perspective.
• Develop strategies, objectives and plans for the material matters identified.
• Implement controlling systems, gather existing data and generate additional information on disclosures defined by the European Sustainability Reporting Standards.
• Develop appropriate governance structures.

For the first step, the materiality assessment based on the double materiality approach,  sustainability impacts as well as financial risks and opportunities must be considered. Due to that, it is crucial that a cross-functional team involving all relevant departments is engaged. This process should be well documented as it is part of the reporting requirements and can be subject to external assurance.

Ferdinand Consultants was one of the first consultancies to develop tools to help companies apply the double materiality concept. Our approach combines external stakeholder engagement with internal enquiry, scientific and public research, and an analysis of existing reporting standards. These insights serve as input for a materiality workshop with key corporate representatives, where our facilitation methodology ensures an efficient identification of the most relevant sustainability matters. Today, we can draw upon our vast experience in helping companies apply the materiality lens across their businesses, and with it build the foundation for a successful sustainability strategy and reporting.

For more information on our approach to double materiality, development of sustainability strategies and sustainability reporting, please contact us: info@ferdinand.es