Annual Carbon & Sustainability Report

1 YEAR

Annual Carbon & Sustainability Report 01 January 2017 – 31 December 2017

Cargo Road Wines

This report by Instep (a division of Asian Scientific Technologies Limited) has been prepared for Cargo Road Wines and is issued according to Instep standard terms and conditions.

Cargo Road Wines CARBON & SUSTAINABILITY REPORT 01 January 2017 - 31 December 2017

17 November 2018

CARBON & SUSTAINABILITY PROGRAMME 2017-2018

Peter Birkett Author

2

Margaret Birkett Peer Reviewer

EXECUTIVE SUMMARY Cargo Road Wines completed its first annual greenhouse gas emission profile for the 01 January 2017 to 31 December 2017 period with Instep, New Zealand.

During this time activity data was collected from identified emission sources and used to calculate total greenhouse gas (GHG) emissions through independent company Instep.

A total of 37.81 tonnes CO2e was produced from identified emission sources.

As shown in Figure 1, Consumed Electricity with associated emissions at 14.99t CO2e** is the most significant source of emissions contributing 39.67% of all Cargo Road Wines' GHG profile. The other main contributors are Company Vehicles at 30.43%, Third Party Freight at 15.34%, Equipment Fuel at a low 8.56% and Distributed Energy at 5.73%; all other areas, including Landfill Waste, are <1.0%.

Cargo Road Wines use three areas of business activity to standardize the total CO2e emissions against. These are total tonnes of fruit (grapes) harvested, total tonnes of fruit (cherries) harvested and total number of bottles of wine processed.

These base year, standardized CO2e emissions are recorded at 0.396 tCO2e emissions per tonne fruit (grapes) harvested, 12.96 tCO2e emissions per tonne fruit (cherries) harvested, and 0.0075 tCO2e emissions per bottle of wine produced.

Scope 3 includes Fugitive Emissions at 0.03 tCO2e and Wines Processing CO2 at 0.038 tCO2e.

Whilst both contributions are included and reported in the Total tCO2e emissions, the volumes are deemed ‘insignificant’ to warrant a separate commentary within the scope reports.

3

% Total CO2e Emissions Distributed Energy 6% Consumed Electricity 40%

Company Vehicles 30%

Winery Processing 0% Freight Transport 15%

Landfill Waste 0%

Equipment Fuel 9%

Figure 1 : Cargo Road Wines Emissions before Mitigation 2017

Target setting within the existing Cargo Road Wines document for the 2018 period ensures Cargo Road Wines is awarded SILVER Certification within the Instep Carbon and Sustainability Monitoring and Reporting Programme.

CARGO ROAD WINES HAS COMMITTED TO A TARGETED 1.0% REDUCTION IN STANDARDIZED CO2e EMISSIONS AGAINST THE BASE YEAR FOR EACH BUSINESS MATRIX

It is acknowledged, and reported, that an almost identical quantity of electrical energy is captured by use of solar panels. Unfortunately, this energy cannot be currently utilized within the vineyards’ processing operations. While this KWh energy is sold back to the grid under normal protocols it cannot be mitigated as a carbon credit. ** Solar generated Electricity was recorded and was sold back to the grid system and not directly used in the Cargo Road Wines’ operation. For verification the actual Consumed Electricity as per purchased electricity has been included in the calculation and the solar generated electricity sold back to the grid is referenced only.

Table of Contents Executive Summary Introduction Background: Cargo Road Wines Total Carbon Emissions Historical Emissions Scope 1 Equipment Fuel Company Vehicles Scope 2 Consumed Electricity Scope 3 Distributed Energy 3rd Party Freight Waste Water Consumption Paper and Publications Consumed Chemicals Looking Ahead Targets Final Comment A Little Bit About Us The Certification Process Who Are We? Appendices Appendix A: Emissions Inventory Organisational Boundaries Operational Boundaries Inventory Exclusions Appendix B: Carbon Footprint Appendix C: Calculation Methodology

4

3 5 5 6 7 8 10 12 14 16 18 20 21 22 24 25 26 28 30 31 32 32 33

34 34 34 35 36 37

INTRODUCTION

The Cargo Road Wines vineyard is one of the oldest in the region, established in 1983 on Cargo Road, west of Orange, New South Wales.

The varieties grown are Merlot, Cabernet Sauvignon, Barbera, Zinfandel, Nebbiolo, GewĂźrztraminer, Sauvignon Blanc and Riesling. The vineyard is planted on deep red basalt and clay-based loam soils, and is largely unirrigated.

The Cargo Road Wines vineyard has monitored its environmental impact internally for some time, however, in 2017 a formal Third Party Base Year emission analysis and reporting programme was introduced into the environmental management systems.

An increasing number of organisations globally are working to understand and mitigate their greenhouse gas (GHG) emissions as they recognise the climate changes taking place, and the hardship these changes may place on land-based production and processing.

This Carbon & Sustainability Report details activity data from GHG emission sources collected throughout the period 01 January 2017 â&#x20AC;&#x201C; 31 December 2017 and verified by independent company Instep.

THERE ARE 6 GREENHOUSE GASES CO2, CH4, N20, HFCS, PFCS & SF6.

EMISSIONS ARE STANDARDIZED AND REPORTED AS CO2e OR CARBON DIOXIDE EQUIVALENT

5

BACKGROUND: Cargo Road Wines The vineyard was taken over in 1997 by a trio from quite different backgrounds, but all sharing an inspiration and desire to build a future. Charles Lane, James Sweetapple, and Brian Walters purchased the run down Cargo Road Vineyard in 1997. The vineyard was already 14 years old, making it the oldest vineyard in the Orange Region. James has spent subsequent years adding to the vineyard and making it into a viable business. This has been achieved primarily through holistic management principals, nurturing and maintaining the property including weed control, pruning, canopy management, and a bit more weed control. It has also increased the varieties planted on site and the number of vines. The first vines were planted in 1983, which makes them some of the region's oldest vines.

The vineyard is largely unirrigated and planted on deep red basalt and clay based loam soils. Being managed and run holistically delivers 'best practice' management techniques which ensure land and environmental conditions continue to improve in a safe and reputable manner, while maintaining a sustainable business.

Management care as much about growing the grapes as they do making the wines. The vines are nurtured all year round; careful pruning , managing undergrowth and weeds holistically, increasing organic matter in the soil, as well as overall soil health. Continuing to develop the terroir, the grapes are always harvested at optimum level of ripeness.

Focus on the environment is crucial in managing the land holistically. This includes a 7 testing process for decision making, always testing back to the holistic context. No pesticides have been used on the property, sheep are used to cycle minerals, and strategic use of a side throwing slasher to mulch the mid-rows under the vines is carried out.

TOTAL CARBON EMISSIONS 37.81 tCO2e Cargo Road Wines has a total GHG emission profile of 37.81 tonnes tCO2e for the 2017 monitoring period.

The largest single emission source is Consumed Electricity making up 39.67% of all emissions. Other sources of significance include Company Vehicles at 30.43%, Third Party Freight at 15.34%, and Equipment Fuel at 8.56% and Distributed Energy (transmission losses) contributing 5.73%; all other areas, including Landfill Waste contributes less than 1.0% (Figure 2).

Figure 3 details total CO2e emissions generated month by month. Although invoice data for Consumed Electricity was quarterly, this has been extrapolated by days in the month. Total CO2e emissions peak in March at 5.39 tCO2e, some 150% higher than the lowest impact month of October at 2.13 tCO2e. Seasonal impact ‘spikes’ appear in March and June when increased Vehicle Fuel consumption rates influence the pattern.

It is important to standardize the absolute footprint value against a measure of business or operational activity so that the effects of business, operational expansion or contraction in future, can be understood.

Figure 4 shows standardized CO2e emissions against business activity. Again, due to the ‘seasonal’ aspect of the business, a monthly pattern is not precise. As highlighted, the lower volume Fruit Produced (Cherries) returns the highest ratio at 12.59 tCO2e emissions per tonne produced, which compares with the second highest which is Fruit Harvested (grapes) at 0.39 tCO2e and finally Bottles of Wine produced at 0.0075 tCO2e.

A STANDARDIZED FOOTPRINT HELPS TO MONITOR EFFICIENCY FROM YEAR TO YEAR. CARGO ROAD WINES’ STANDARDIZED FOOTPRINT IS 0.0075TCO2E/ PER BOTTLE PRODUCED. 6

% Total CO2e Emissions Distributed Energy 6% Consumed Electricity 40%

Winery Processing 0% Freight Transport 15%

Landfill Waste 0%

Company Vehicles 30%

Equipment Fuel 9%

Figure 2: Cargo Road Wines Australia Emissions Sources 2017

Total CO2e Emissions 2017 6

5 4 3 2 1

0

Figure 3: Cargo Road Wines Total Monthly CO2e Emissions

Standardised CO2e Emissions 2017 14 12 10 8 6 4 2 0 Standardised CO2e Emissions 2017

CO2e Per Fruit CO2e Per Fruit Harvested Produced 0.395971704

12.60509924

CO2e Per Bottle wine 0.007532928

Figure 4: Cargo Road Wines Standardized CO2e Emissions

HISTORICAL EMISSIONS This is Cargo Road Wines' first year undertaking the Instep Carbon & Sustainability Monitoring Programme with this 2017 period used as the base year.

Once the initial annual carbon footprint has been calculated and reported, future years’ results can be used to track emission reductions over time against this base year.

Standardized CO2e emissions are an important measure of efficiency and although impacted by ’seasonal’ activity, Figure 5 delivers an outline of that ’seasonal’ impact by month over the period.

1 0.8 0.6 0.4 0.2 0

Standardised CO2e Emissions Bottle Produced Standardised CO2e Emissions Fruit Harvested Standardised CO2e Emissions Cherries Harvested

Figure 5: Cargo Road Wines Australia Standardized CO2e

Table 1: Cargo Road Wines Emission Sources 2017 Scope

Emission Source

Activity Data

Base Year Main KPI Carbon Emissions (tCO2e)

% of Total CO2e Emissions

L/ m3/ kg

3.23

8.56 %

4066 Litres

11.50

30.43 %

Losses

0.03

<1.0 %

14.99

39.67 %

1

Equipment Fuel– Various

1

Company Vehicles

1

Refrigeration and Cooling

2

Consumed Electricity

18,062 kWh

Solar Energy returned to grid

17,844 kWh

Distributed Energy

18,062 kWh

2.17

5.73 %

Cargo Road Wines Processing CO2

38.0 kg

0.038

<1.0 %

Third Party Freight

39,432.27 tkm

5.80

15.34 % <1.0 %

3

Landfill Waste Sustainability Measures

135.20 kg

0.06

Landfill Diversion Material

1,031.40 kg

_

Water

2,590 Litres

Paper & Publications

3,500 A4 ~ sheets

Chemicals Consumed

Various

Operational TOTAL Standardized footprint tCO2e

7

37.81 Bottles of Wine

5020

Fruit Harvested (Grapes)

95.5 tonne

Cherry Fruit Produced

3.0 tonne

0.0075 0.396 12.59

Scope:

1

"Scope 1 emissions are direct GHG emissions from sources that you own or control"

EQUIPMENT FUEL 3.23 tCO2e

Table 2: Cargo Road Wines Equipment Fuel Emissions 2017 Current Year Activity Data

Current Year Carbon Emissions (tCO2e)

% of Total CO2e Emissions

CO2e% Per Tonne Fruit Produced (Cherry)

CO2e% Per Tonne Fruit Harvested (Grape)

CO2e% Per Bottle Produced

Diesel Fuel

1080 Litres

2.92

7.73

0.97

0.03

0.0006

LPG

189.5 Litres

0.296

0.78

0.099

0.003

0.00006

Wood

600 kg

0.0126

0.03

0.0042

0.00013

2.5x10-6

Waste Paper

4.5 kg

0.0945

0.25

-

-

-

1.078

0.033

0.00064

Category

Total

3.23

Emissions from Equipment Fuel are produced when various fossil fuels are burned in stationary equipment or machinery.

Figure 6 highlights the make up of this important scope with diesel fuel, as detailed in Table 2, dominating the emission profile by contributing 90% of the total 3.23 CO2e emissions generated.

Figure 7 again highlights the seasonal nature of emission generation with the warmer and drier months of January, February and March demanding greater fuel consumption, especially in the water pump area.

While winter is a lower consumption season, the â&#x20AC;&#x2DC;spikeâ&#x20AC;&#x2122; in July is the more regular barrel wash consumption.

The final quarter of the period again records a lift in total consumption and associated CO2e emissions.

LPG is utilized in the restaurant area and household heating. It consumes a low level of 189.5 kg, generating less than 10% of Equipment Fuel emissions and less than 1% of total operational CO2e emissions.

Total Equipment Fuel CO2e Emission Profile 2017 House Heating LPG 4%

Restaurant LPG 5%

BBQ LPG 0% Barrel Washer Diesel 32%

Waste Paper 0% Wood Figure 6:Water Cargo Road Wines Australia Equipment Fuel Year on Fireplace Pump Year Diesel Apple Box 59% 0%

Figure 6: Cargo Road Wines Equipment Fuel CO2e Emissions

Low level emission generating fuels such as wood and recycled paper are a positive contributor.

Equipment Fuel Total CO2e Emissions 2017 0.7 0.6 0.5 0.4

0.3 0.2

0.1 0

Figure 7: Cargo Road Wines Equipment Fuel CO2e Emissions

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Figure 8 details the three main fuel consumption levels throughout the period and again highlights the changing demands for each fuel. July is the only month during winter where diesel consumption takes place outside of the drier months; the July use is for barrel washing operations.

450

200 180 160 140 120 100 80 60 40 20 0

400 350 300

Diesel Consumption Water Pump

250

Diesel Consumption Barrel Washer

Figure 9: Cargo Road Wines Diesel Consumption by Area

200 150 100 50

400

0

350 300

250

Diesel Consumption Litres

LPG Consumption Litres

Wood Consumption Kg

Figure 8: Cargo Road Wines

200 150 100

50 0

Figure 9 highlights this further with the two main uses for diesel. Water pump fuels dominate consumption, especially during the drier months in the first quarter of the year. This requirement naturally eases throughout winter before kicking back in from October onwards.

The barrel wash requirement is somewhat more consistent over the period and, as discussed, accounts for the entire winter consumption consuming 30% in the first quarter of the year.

Figure 10 details standardized fuel consumption per business activity. It is acknowledged this ratio can be somewhat distorted due to low levels of fuel use and in some cases (eg cherries) the relatively low volume level.

However, the ratio is important in establishing a base year profile to allow comparisons and objectives to be set in future years. As highlighted, the annual consumption is 360 litres of diesel per tonne of cherries, 11.30 litres per tonne of grapes and the important 0.215 litres per bottle of wine. LPG ratio records a low 0.037 kg per bottle of wine produced.

Figure 11 details standardized Equipment Fuel CO2e emissions per business activity with the focus on total standardized CO2e emissions; again this follows trends previously discussed.

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Standardised Diesel Litres Standardised KG LPG

Bottle Wine 0.215139442 0.037749004

Tonnes Cherries 360 63.16666667

Tonnes Grapes 11.30890052 1.984293194

Figure 10: Cargo Road Wines Standardized Main Fuels

1.2 1 0.8 0.6 0.4 0.2 0

LPG Standardised CO2e Emissions Diesel Standardised CO2e Emissions Total Standardised CO2e Emissions

Bottle Wine

Tonnes Cherries

Tonnes Grapes

5.88884E-05

0.09854

0.003095497

0.000582813

0.97524

0.030635812

0.00064423

1.0780115

0.033864236

Figure 11: Cargo Road Wines Equipment Fuel Standardized CO2e Emissions

Objectives - Improve energy efficiency of all office buildings, shops and warehouse.

Targets for 2018 - Reduce standardized CO2e emissions per business activity by 1.0% against all business matrix.

Initiatives - Audit closely water pump and barrel washing operations to ensure maximum efficiencies are met.

COMPANY VEHICLES 11.50 tCO2e

Table 3: Cargo Road Wines Company Vehicle Emissions 2017

Category

Current Year Activity Data

Current Year Carbon Emissions (tCO2e)

% of Total Vehicle CO2e Emissions

CO2e% Per Tonne Fruit Produced (Cherry)

CO2e% Per Tonne Fruit Harvested (Grape)

CO2e% Per Bottle Produced

Hilux Ute

1320 L

3.59

31.22 %

1.197

0.037

0.00071

Quad Bike

260 L

0.619

5.38 %

0.20

0.0065

0.00012

KUBOTA 95

2034 L

2.03

48.11

0.676

0.021

0.00040

KUBOTA 59

212 L

0.21

5.01

0.07

0.0022

4.18x10-5

MASSEY

60 L

0.06

1.42

0.02

0.0006

1.19x 10-5

FORKLIFT 1

440 L

1.01

6.43

0.33

0.01

2.0 X10-5

TOTAL

3626 L

11.499

3.83

0.120

0.0023

Emissions from Company Vehicles are produced when fuel (petrol, diesel, LPG) is combusted in a mobile source. This not only includes company owned vehicles, but can also include forklifts, ships or other company owned transport options. Figure 12 highlights the contribution made to the profile from vehicles. Two specific vehicles make up almost 80% of the total CO2e emissions for the operations. These are the Kubota 95 and the Hylux Ute which contribute 48% and 31% respectively.

Figure 13 shows the consumption pattern over the period and clearly March is a busy month, especially with the Kubota 95 which used the greatest quantity of any vehicle over the year at 485 litres of diesel for the month.

Total Company Vehicles CO2e Emissions KUBOTA 59 5%

KUBOTA 95 48%

MASSEY 2% FORKLIFT 9%

QUAD BIKE 5%

HYLUX UTE 31%

Figure 12: Cargo Road Wines Company Vehicle Fuel CO2e Emissions

Total Litres Consumed 2017 900 800 700 600 500 400 300 200 100 0

Figure 13: Cargo Road Wines Company Vehicle Fuel Litres

12

Naturally, Figure 13 tends to follow the pattern of Figure 12, although there will be slight differences due to levels of different fuels being consumed; each fuel having different emission factors.

Having said that, clearly the pattern is similar with most CO2e emissions being generated in the first quarter. It appears this scope of the business activity doesn't impact as much in the final quarter of the year, unlike Equipment Fuel which recorded a definite lift in the last 3 months.

Figure 14 shows actual fuel consumption per identified vehicle. The Kubota 95 consumes the greatest volume over the period with the first quarter pattern naturally following the CO2e emissions pattern .

Figure 15 delivers the important litres per business activity with again reduced volume Cherry production impacted because of volume.

A profile of 0.80 litres per bottle of wine is an important standardized ratio.

Objectives - Minimise fuel consumption whilst meeting production and processing requirements.

Targets for 2018 - Reduce litres per business matrix by 1.5% Initiatives - Focus on â&#x20AC;&#x2DC;spikeâ&#x20AC;&#x2122; periods of January, March and December with the aim of maximising efficiency levels.

Total Company Vehicle CO2e Emissions 2017 2.5 2 1.5

1 0.5 0

Figure 13: Cargo Road Wines Company Vehicle Fuel CO2e Emissions

600 500 400 300 200 100 0

Litres Consumed Hylux Ute Litres Consumed Kubota 95 Litres Consumed Massey Litres Consumed Forklift 2

Litres Consumed Quad Bike Litres Consumed Kubota 59 Litres Consumed Forklift 1

Figure 14: Cargo Road Wines Company Vehicle Litres by Vehicle

Standardised Litres Per Business Activity 1400 1200 1000 800 600 400 200 0

Fruit Produced Cherries

Standardised Litres Per 1295.333333 Business Activity

Fruit Harvested Grapes

Bottle of Wine Produced

40.69109948

0.774103586

Figure 15 Cargo Road Wines Company Vehicle Fuel CO2e Emissions

13

Scope:

2

"Scope 2 emissions are indirect GHG emissions resulting from the generation of electricity, heating and cooling, or steam power purchased by Cargo Road Wines Operations"

CONSUMED ELECTRICITY 14.99 tCO2e

Table 4: Cargo Road Wines Consumed Electricity Emissions 2017 Current Year Activity Data

Current Year Carbon Emissions (tCO2e)

CO2e% Per Tonne Fruit Produced (Cherry)

CO2e% Per Tonne Fruit Harvested (Grape)

CO2e% Per Bottle Produced

Winery Operations

18,062 kWh

14.99

-

-

-

TOTAL

18,062 kWh

14.99

-

-

-

Standardized Kwh

6020

189.13

3.60

Standardized CO2e

5.00

0.157

0.0030

Category

Solar kWh Sold Back to Grid

178944 kWh

14.81

Almost Every Type of Business or organisation will have a GHG profile which features considerable emissions from Consumed Electricity. These are Scope 2, or indirect emissions, as they occur outside your organisational boundary. The emissions occur where the electricity is being produced, however, these are a direct consequence of your actions (e.g. turning on the lights).

Figure 16 details this largest contributor to the total CO2e emission profile for the 2017 period.

Although data presented was on a quarterly basis, to make results more presentable the data was extrapolated to represent the numbers of days per month.

A very even and consistent pattern is delivered with the trough highlighted in February more likely to be connected with the calculation around the 28 days. A very positive reduced trend appears from September onwards before a slight uplift in December.

No significant increase is evident over the winter period which is extremely positive for such an operation.

Figure 17 details the standardized kWh consumption per business activity, again the focus is on the 3.60 kWh per bottle of wine produced.

16

Invoiced Consumed Electricity kWh 2017 1800 1600 1400 1200 1000 800 600 400 200 0

Figure 16 Cargo Road Wines Consumed Electricity kWh

Standardised kWh Consumption 7000 6000 5000 4000 3000 2000 1000 0 Standardised kWh Consumption

Fruit Produced Cherries

Fruit Harvested Grapes

Bottle of Wine Produced

6020.666667

189.1308901

3.598007968

Figure 17 Cargo Road Wines Consumed Electricity kWh

Figure 18 delivers the same standardized CO2e emissions for each business activity.

Figure 19 highlights the previously discussed recording of the Solar generated electricity.

This Solar generated power unfortunately cannot be currently utilized for power production or processing facilities within the winery building(s). 100% of this low-emission, generated power is sold back to the grid system.

Figure 19 illustrates that the spring and summer periods return a positive level of wattage which would be extremely useful if it could be harnessed for the processing operations. This would reduce costs and associated CO2e emissions in future years.

Objectives - To utilize Solar when possible to do so but in the meantime ensure all staff are aware of objectives of minimising consumption, especially during winter months.

Targets for 2018 - Reduce kWh per business matrix by 1.0% Initiatives - Continue to sell Solar power back to the grid.

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Consumed Electricity Standardised CO2e Emission 6 5 4 3 2 1 0

Fruit Produced Fruit Harvested Bottle of Wine Cherries Grapes Produced

Consumed Electricity Standardised CO2e 4.997153333 Emission

0.156978639

0.002986347

Figure 18: Consumed Electricity Standardized CO2e Emissions

Figure 19: Purchased kWh versus Solar kWh Generated and Sold to the Grid.

Scope:

3

"Scope 3 emissions include indirect GHG emissions from sources not owned or directly controlled by Cargo Road Wines, but related to Cargo Road Winesâ&#x20AC;&#x2122; processing activities"

DISTRIBUTED ENERGY 2.127 tCO2e

Table 5: Cargo Road Wines Distributed Energy Emissions 2017

Category

Current Year Activity Data

Current Year Carbon Emissions (tCO2e)

Distributed Energy

18,062 kWh

2.17

Emissions from Distributed Energy occur when electricity and gas is transferred through power lines and gas pipes.

In the case of Cargo Road Wines’ operations these emissions are directly linked to purchased and Consumed Electricity throughout the operations.

Any actions put in place to reduce Consumed Electricity use will also affect Distributed Energy emissions.

The direct link to important KPIs such as Consumed Electricity ensures this Scope 3 area remains an important contributor to any of the Cargo Road Wines’ operations.

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WHILE THERE ARE NO OPPORTUNITIES TO REDUCE THIS SOURCE DIRECTLY, IT IS STANDARD PRACTICE TO INCLUDE DISTRIBUTED ENERGY IN A GHG EMISSION PROFILE

3RD PARTY FREIGHT 5.80 tCO2e

Table 6: 3rd Party Freight

Category 3rd Party Freight

Current Year Activity Data (tkm)

Current Year GHG Emissions(tCO2e)

39,432.27

5.80

Freight Emissions from national and international transport is measured by tonne kilometers (tkm), meaning GHG emissions are influenced both by the distance travelled and the weight of product shipped.

Cargo Road Wines utilize 3rd Party Freight providers to make effective deliveries to the region and regular freight of Fruit and Wine to and from other locations, mainly within NSW. Total emissions from 3rd Party Freight are significant and contribute 5.80 tCO2e, or over 15% of the operation’s total CO2e emissions.

Figure 20 highlights the nature of ‘seasonal’ activity with spikes reported in April and June. Management will be able to link this data with actions and shipments at that time.

An attempt to link business activity by weight to such data was challenging due to the complexities of time after harvest, processing etc.

Any delivery of Cherries, or other fruit or wine which was undertaken by Cargo Wines’ own vehicles (i.e. Ute) has been captured under the Company Vehicle Scope 1 area.

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Total Third Party Freight CO2e Emissions 2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 Jan Feb Mar Apr May Jun

Jul Aug Sep Oct Nov Dec

Figure 20: Third Part Freight CO2e Emissions

WASTE 0.06 tCO2e

Table 7 : Cargo Road Wines Waste Emissions 2017 Current Year Activity Data

Current Year Carbon Emissions (tCO2e)

Kg Per Tonne Fruit Produced (Cherries)

Kg Per Tonne Fruit Harvested (Grapes)

Kg Per Bottle of Wine Produced

135.20 kg

0.06

45.0

1.41

0.026

840 kg

-

-

0.167

Cardboard

0 kg

-

-

-

Light Plastic

12 kg

4.0

0.12

0.0023

Plastic Bins

14.4 kg

4.8

0.15

0.0029

0

-

-

102.5 kg

34.16

1.07

0.020

70.0 Litres

23.3

0.73

0.013

391.36

12.29

0.234

Category Landfill Waste Glass

Plastic Drums Chemical Packaging Waste Oil Total Waste

1174.10

0.06

Landfill Waste Emissions are produced when an organisationâ&#x20AC;&#x2122;s waste is sent to council-owned landfills where organic waste breaks down and produces methane, a powerful greenhouse gas.

Although emissions from waste are often relatively small, the reduction of waste levels can be important for a variety of other environmental factors.

Only waste sent to landfill is included in the GHG calculation, however, all types of waste and recycling are considered.

Table 7 details the comprehensive waste profile of Cargo Road Winery operations.

The focus and attention by management in this important area is rewarded with the delivery of one of the lowest, if not the lowest, CO2e emissions recorded and reported by the Instep Programme.

22

Total Waste Profile by Kg Cardboard 0%

Bottles 72% Landfill 11%

Light Plastic 1%

Plastic Bins 1% Plastic Drums 0% Chemical Packaging 9% Waste Oil 6%

Figure 21: Total Waste Profile by Kg and Waste Stream

Figure 21 shows that Landfill Waste accounts for only 11% by weight of the total waste stream.

This low volume generates a very low 0.06 CO2e emissions over the entire annual period.

Figure 22 highlights the seasonal nature of the business and details the dominance of the Glass Bottle waste stream over all others, including Landfill.

A crucial component of any sustainability report is the amount of waste material that any operation can avoid sending to Landfill.

This Landfill Diversion rate is an important aspect of all business operations and is increasingly important in all commercial and regulatory areas.

Cargo Road Wines reports one of the highest Landfill Diversion rates that we have reported, at 89% by weight; management and staff need to be congratulated for their initiatives and administration in this important area.

However, this high level of diversion should not raise false confidence and efforts should continue to analyze where any packaging can be eliminated from the operation. While this may reduce the Landfill Diversion rate, it can potentially reduce the total volumes of waste across the industry.

Objectives - Minimise volumes of all waste produced.

- Maximise proportion of waste being recycled or repurposed.

- Reduce waste coming onto site.

Targets - Establish clear and precise waste stream analysis.

- Identify and set reduction targets for 2018 and beyond.

Initiatives * - Initiate four ‘spot check’ waste audits per annum.

- Develop and implement waste education sessions/information with staff.

- Review waste management practices at all areas of the business, i.e. restaurant, processing, office etc.

- Ensure no waste bins at desks.

- Become a disposable coffee cup ‘free zone’.

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300 250 200 150 100 50 0

Landfill Waste Kg

Glass Bottles Kg

Light Plastic kg

Plastic Bins Kg

Plastic Drums Kg

Winery Waste Kg

Chemical Packaging Kg

Oil Litres

Figure 22: Total Waste Volumes 2017

WATER CONSUMPTION 2,590 Litres

Table 8: Cargo Road Wines Water Consumption 2017

Category Water Consumption m3/kL Total Litres

Current Year Activity Data

Litres Per Tonne Fruit Produced (Cherries)

Litres Per Tonne Fruit Harvested (Grapes)

Litres Per Bottle of Wine Produced

86,333

27,120

515.94

2590 2,590,000

Water Consumption and conservation is a crucial aspect of any business in rural Australia and Cargo Road Wines appreciates this important area of resource management.

Whilst the data reveals 2,590,000 litres consumed, this area is a complex and delicate aspect of any successful vineyard and the ready availability of a water source is extremely critical.

This base year data is a start for gaining a total picture of not only the quantity of water consumed, but how the water is captured and supplied, viz. dams, springs etc. which will be reported in more detail in the following years.

Table 8 details total water consumption and indicative volumes per tonne of business activity.

This consumption ratio is based on the data available and does not analyze total water required in growing product etc.

24

Water Consumption m3 900 800 700 600 500 400 300 200 100 0

Figure 23: Total Water Consumed 2017

PAPER AND PUBLICATIONS Table 9: Cargo Road Wines Paper & Paper Consumption 2017 Category

Current Year Activity Data A4 Equivalent

Paper & Publication

3,800

Total A4 Equivalent sheets

3,500

Litres Per Tonne Fruit Produced (Cherries)

Litres Per Tonne Fruit Harvested (Grapes)

Litres Per Bottle of Wine Produced

1166

36.64

0.70

Paper Consumption is a core part of most businesses.

Often there are opportunities to reduce environmental impact through altering what is purchased and used within a business.

Investigating sustainable options within your supply chain can reduce your indirect environmental impact.

Figure 24 details a common purchasing pattern set of data with ordering on an as-required basis.

A total of 3,500 sheets of A4 equivalent sheets were consumed over the period.

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Water Consumption m3 900 800 700 600 500 400 300 200 100 0

Figure 24 Total Paper & Publications 2017

REDUCTION RECOMMENDATIONS - As more on-line, real-time, technology becomes available, the opportunities to reduce paper printing increase. Continue to explore ways to use technology to replace printed options.

- Consider conducting a paper trail audit to determine the major sources of paper use to identify any potential areas for consumption reduction.

- Share the annual data on paper and publication with all staff and target a 10% reduction.

CONSUMED CHEMICALS Table 10: Cargo Road Wines Chemical Consumption 2017 Category Chemical Consumption

Purpose

Quantity

Sulphur

Powdery Mildew Control

500 kg

Copper

Downey Mildew Control

160 kg

Folia Nutrition

120 Litres

Foliar

40.Litre

-

40 Litres

Blackberry Control

-

Kelp Boron Potassium Grazon

While delivered in accordance with ISO standards and appropriate GHG protocols, the Instep Programme also delivers a â&#x20AC;&#x2DC;tailoredâ&#x20AC;&#x2122; sustainability report for each client.

Cargo Road Wines operates with a strong conscience when looking after land, plants and products produced.

With this in mind, it is important to monitor and report chemical consumption over the reporting period.

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2018 Looking Ahead

"A reduction goal for the future is an essential component to reducing your emissions.

It allows progress to be tracked over time"

REDUCTION GOALS 2018 A Quantifiable Reduction Goal is a crucial component of any Carbon and Sustainability Programme so that progress can be tracked over time. Goals should commit to a percentage reduction over a specific time period in relation to the emission base year value.

Reduction goals can either be absolute or intensity focused.

Cargo Road Wines has chosen to commit to a 1.0% reduced in each of the standardized business matrix.

The goal is focused around, but not limited to, three specific KPI areas; Energy Emissions, Company Vehicles and Consumed Electricity emissions.

This could be achieved by specific target reductions in Equipment Fuel emissions by 2.0%, a 1.5% reduction in Company Vehicle emissions, and a 1.0% reduction in the largest contribution area of Consumed Electricity.

This target reduction of 1.0% for each business matrix standardized CO2e emissions could be achieved by combining the suggested reduction recommendations and the in-house selected targeted areas.

G Suggested Targets - Major KPIs Equipment Fuel Emissions Objectives - Improve energy efficiency of all office buildings, shops and warehouse.

Targets for 2018 - Reduce standardized CO2e emissions per business activity by 1.0% against all business matrix.

Initiatives - Audit closely water pump and barrel washing operations to ensure maximum efficiencies are met.

Company Vehicle Emissions Objectives - Minimise fuel consumption whilst meeting production and processing requirements.

Targets for 2018 - Reduce Litres per business matrix by 1.5% Initiatives - Focus on â&#x20AC;&#x2DC;spikeâ&#x20AC;&#x2122; periods of January, March and December with the aim of maximising efficiency levels.

Consumed Electricity Emissions Objectives - To utilize Solar when possible to do so but in the meantime ensure all staff are aware of objectives of minimising consumption, especially in the winter months.

Targets for 2018 - Reduce kWh per business matrix by 1.0% Initiatives - Continue to explore installation of equipment to utilize Solar throughout the operation.

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FINAL COMMENT Cargo Road Wines has now completed its first year in the Instep Carbon and Sustainability Monitoring Programme.

This third party verified programme enhances the long standing focus on environmental and holistic delivery of business activity and products produced within the Cargo Road Wines organization.

Dedication, passion, and forward thinking strategic plans are at the heart of the management of Cargo Road Wines, and it is a natural step that management and staff wish to take transparency and environmental reporting to the next level.

Both management and staff have significant challenges in delivering the targeted reductions due to somewhat unique circumstances.

The fact that business operational emissions and environmental impacts are already at an extremely low level, limits the opportunity to deliver significant improvements in the short term.

However, management identifies opportunities to position the operationâ&#x20AC;&#x2122;s eco credentials and environmental management programmes alongside the long-running holistic management techniques, in order to differentiate itself and be recognized as a market leader, not only in the local Australian market, but internationally.

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As a result of the commitment to set reduction targets Cargo Road Wines is awarded SILVER status criteria within the Instep Carbon and Sustainability Programme.

The Cargo Road Wines management and organisation operates a robust, professionally managed operation and records, reports and takes action on appropriate KPIs on a very regular basis.

CARGO ROAD CARGO ROAD WINES HAS COMMITTED TO A REDUCTION GOAL OF 1.0% STANDARDIZED EMISSIONS FROM THE BASE YEAR

A LITTLE BIT ABOUT US

By Joining the Instep Programme you are making a conscience decision to do something positive about a global problem. At instep we believe that without first understanding your own impacts, one cannot take the right action. We strongly believe that your individual awareness and action has a more positive impact on our environment than the purchasing of carbon ‘offsets’. Any effects of climate change cannot be reversed overnight, however you may be surprised how small changes through the Instep programmes can make a big difference to your own situation. At Instep, we like to look at the positive things you can do, and they might be easier than you think. Our experience has shown that if ‘you measure it – you manage it’.

AS THE PROVERB GOES “EVERY JOURNEY OF A THOUSAND MILES STARTS WITH A SINGLE STEP”. THE INSTEP PROGRAMMES WILL ASSIST YOU IN YOUR OWN SUSTAINABILITY

JOURNEY

THE CERTIFICATION PROCESS On joining an Instep programme, members receive a Bronze participation certificate which shows that you have taken the initiative to manage your carbon emissions. On completion of the programme, Instep undertakes a full reassessment of your carbon footprint and certifies your operation depending on the target.

Achieving your goals set in two consecutive gold certified years achieves PLATINUM

Achieving the goal set during your silver year achieves GOLD

Setting a goal at the end of the first year achieves SILVER

Instantly certified as BRONZE

New member sign up

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We then discuss goals for the future and how we can work together to achieve these agreed goals. The core focus of the Instep programme is emission reduction.

By setting a goal for the coming year for emission reduction you will receive Silver certification. Members who then reach their reduction target at the end of that monitoring period are awarded Gold certification. Once you have reached Gold, if you continue to set and achieve your reduction goals for two consecutive Gold certified years, you will be awarded Platinum certification.

WHO ARE WE? Peter Birkett, Director and Founder of Instep.

With over forty yearsâ&#x20AC;&#x2122; experience in the international specialist chemical industries, Director and Founder Peter Birkett knows that environmental monitoring and reporting must be carried out accurately, professionally and with little disturbance to business-as-usual. After viewing first-hand the environmental and sustainability issues industry and business face around the world Peter established Instep aiming to assist with minimising the impact of these processes on the environment and assist businesses of all types to meet the environmental challenges in today's business world.

Alisha Black, Technical Director Instep.

Scientific credibility and compliance with all International Standards are key to the success of the Instep programmes and consulting services. Under the control of Alisha Black and her scientific team we know that this requirement is achieved. Alisha completed her MSc in Biology at the University of Auckland, studying molecular genetics and environmental science. Since then her working experience has involved roles both in the laboratory and the field undertaking air, water and odour testing. Over the last ten years Alisha and her team have created and developed the very successful range of Instep Carbon and Sustainability Programmes.

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Margaret Birkett, Director and Finance Manager

Margaret's background is in education with many years of teaching in the UK, Hong Kong and New Zealand.

She subsequently moved into educational administration with responsibility for budgets, payroll and enrolments.

Most recently she has held the roles of Careers, Gateway and STAR administrator, and International Student Manager-all within the educational system.

Appendix A

EMISSIONS INVENTORY ORGANISATIONAL BOUNDARIES Before identifying emission sources to be included in a footprint analysis, it is essential to set a boundary for the footprint. A boundary defines the business operations in such a way that certain emission sources can be either included or excluded from footprint analysis. This is important so that the organisation does not under or over estimate the GHG emissions for which it is responsible. It helps to avoid double counting of emissions, when two organisations both include emissions from the same sources in their own inventories.

The control approach used to set Cargo Road Wines’ organisational boundary is the operational control approach. This specifies that Cargo Road Wines shall include all GHG emission sources over which it can implement operating policies.

A representation of the organisational boundary can be seen in Figure 1 (Page 34) OPERATIONAL BOUNDARIES Operational boundaries refers to the actual sources of GHG emissions within the organisation’s operations that will be included in the emission profile. They are commonly referred to as either direct emissions; which are those that the organisation has direct control over (e.g. driving the company car), or indirect emissions which are a consequence of the organisation’s activities, yet are controlled by someone else (e.g. taking an international flight in a plane). Operational boundaries are divided into three areas known as Scopes.

A full list of all emission sources within Cargo Road Wines’ operational boundary is included on Page 35.

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Scope 1

Scope 1 emissions are direct emissions that occur in sources directly under your control. They must be included in your carbon profile. The following Scope 1 sources were identified: - Equipment Fuel Company Vehicles Refrigeration and Cooling Scope 2

Scope 2 emissions refer only to those indirect emissions that are produced through the generation of electricity purchased by your organisation. Scope 2 emissions must be included in your carbon profile. The following Scope 2 sources were identified - Consumed Electricity Scope 3

Scope 3 emissions refer to all other indirect emissions that may be outside your footprint boundary. There are a huge number of possible sources that can be included in Scope 3 footprint analysis. The inclusion of Scope 3 sources is optional, but it is important to consider any sources that may have a significant impact on your carbon footprint, or offer potential for reduction measures. The following Scope 3 sources were included in Cargo Road Wines’ profile: - Distributed Energy Fugitive Emissions - Landfill Waste - Third Party Freight Sustainability Measures

There are many other environmental impacts that are not included in GHG emission calculations yet still have environmental impacts that are discussed in this report; - Landfill Diversion Materials and Water

Cargo Road Wines

Cargo Road Wines Vinyard

ORGANISATIONAL BOUNDARY

Equipment Fuel

Consumed Electricity

Distributed Energy

Company Vehicles

Third Party Freight Landfill Waste Fugitive Emissions

Cargo Road Wines Events

Product Grown or Processed

Post sale

Organisational Boundary

INVENTORY EXCLUSIONS In order to maximise the transparency of Cargo Road Wines’ GHG profile, this report includes a full disclosure of emission sources not included in calculations and the reasons for exclusion.

COOLING AND REFRIGERATION

Scope1 Cooling and Refrigeration was included in the ’base year’ but will be deemed insignificant in future.

ALMOST EVERYTHING HAS A CARBON FOOTPRINT, HOWEVER, MANY ENVIRONMENTAL IMPACTS ARE NOT CURRENTLY INCLUDED IN EMISSION CALCULATIONS DUE TO LOW IMPACT, COMPLEX CALCULATIONS, OR INACCURATE DATA

Cargo Road Wine’s Emission Sources Monitored 2017 Scope

Category

Source

ID

Activity Data

Data Units

1

Equipment Fuel (Gas )

Heating/ operational equipment

CRW 011

Fuel receipts

Kg/l

Company Vehicle

Service Vehicles

CRW –012

Company Records

L

2

Consumed Electricity

Office / Operations

CRW 102

Power bills

kWh

3

Distributed Energy

Energy / Electricity as above

CRW133

Fuel / Power bills

kWh

Third Party Freight

Transport

CRW 1032

Company records

tkm

Waste

Landfill Waste

CRW 1036

Company Records

M3/ kg/ litres

Fugitive Emissions

Wines Processing Gas/ Cooling and Refrigeration

Paper and Publications

Paper and Stationery

CRW 1035

Company Records

# sheets

Landfill Diversion

Waste management

CRW 1036

Invoices

m3

Water

Water

CRW 1037

Invoices

Litres

Chemical Consumption

Various

CRW 1038

Company Records

Kg/Litres

SUSTAINABILITY MEASURES

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Appendix B

CARBON FOOTPRINT BACKGROUND: Carbon Footprint A carbon footprint is a way of quantifying the amount of GHG emissions for which an individual, organisation or event is responsible.

It is widely recognised that global emissions of the six greenhouse gases are responsible for increasing the greenhouse effect in the atmosphere and causing potentially dangerous levels of climate change.

Increasingly, organisations have recognised the need to monitor and calculate their carbon footprint, so that they can put in place strategies to manage and reduce it.

To calculate a carbon footprint, all possible sources of GHG emissions must first be identified. Then activity data relating to the source is collected and the amount of greenhouse gas calculated using published emission factors.

Emissions from all sources are then added together to give a total carbon footprint, or carbon emission profile, expressed in carbon dioxide equivalent or CO2e.

36

A GHG PROFILE IS A WAY OF QUANTIFYING THE AMOUNT OF GHG AN ORGANISATION IS RESPONSIBLE FOR, EXPRESSED AS TONNES OF CARBON DIOXIDE EQUIVALENT, OR CO2E. IT IS DIVIDED INTO 3 AREAS KNOWN AS SCOPES, AND MEASURED ACCORDING TO INTERNATIONAL STANDARDS

Appendix C

CALCULATION METHODOLOGY Data was collected for the twelve month period 01 January 2017 â&#x20AC;&#x201C; 31 December 2017, from a range of sources. All data supplied by Cargo Road Wines was subject to Instep Quality Assurance.

Further detail on quality assurance and uncertainty assessment can be found in the separately issued Verification Report.

Instep performed calculations on data supplied by Cargo Road Wines in accordance with the methods detailed in the internationally recognised WBCSD/WRI Greenhouse Gas Protocol1 and ISO 14064-12.

1

World Business Council for Sustainable Development & World Resources Institute (2004) Greenhouse Gas Protocol Corporate

Accounting & Reporting Standard 2

ISO 14064-1 Specification with guidance at the organisation level for quantification and reporting of GHG emissions and removals.

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Emission factors used were the most current available and came from a variety of sources. Details on the calculation methodology and emission factors used for each source are listed in detail in the Verification Report which has been prepared according to ISO 14064-33.

3

ISO 14064-3 Specification with guidance for the validation and verification of greenhouse gas assertions.