Electronic invoicing is also becoming increasingly important from an ecological point of view. The elimination of paper in invoicing can significantly reduce CO2 emissions. Each individual invoice entails a small ecological footprint. But all in all, the mountains of wasted paper are enormous. You can be part of the change!
In the German federal state of Hesse alone, public municipalities and administrations send between 120 million and 270 million invoices per year. Not to mention the other federal states, the European Union and companies worldwide. The invoice volume is enormous. In another article in this series, we have taken a closer look at the loss of time due to manual processing. This text deals with the ecological potential of electronic invoicing.
A study by Goethe University Frankfurt
The two researchers Stanislav Kreuzer and Steffen Bernius have analyzed the CO2 emissions per invoice. For a correct representation, the first step is to find out which resources are required for an invoice. We can roughly distinguish between
- the actual invoice
- accompanying documents (explanations)
- (auxiliary) documents created in the editing process
- resources from processing
Other papers often occur during processing. This can be for example to confirm the invoice receipt, space for more extensive calculations or approval processes within the company. The researchers, therefore, calculate an average of 2.5 pages per invoice. This is an average value that is in line with our experience at io-market. In addition, the long processing time of the employees and the average energy consumption must be taken into account in order to obtain a comprehensive picture of the ecological footprint. The researchers conclude with an average environmental impact of 100g CO2 for a paper-based calculation. The savings potential is enormous: By switching to a fully electronically processed invoice, emissions can be reduced to just 53g CO2. In addition to the extreme efficiency gain, the environmental impact is reduced by almost half!
Five times the CO2 consumption of paper
The Institute for Applied Ecology in Freiburg achieved even more drastic results a few years ago. A study in cooperation with Deutsche Telekom predicts a fivefold increase in CO2 emissions from paper invoices. The institute considered both the preparation of the invoice and its dispatch. Not only paper but also energy consumption and infrastructure costs were taken into account.
The effects can be compared well with the example of the federal state of Hesse. The state processes an average of 200 million invoices a year. If the authorities now consistently switch from manual processing to electronic invoicing, this would save around 9,400 tons of CO2 emissions per year. If the authorities were to reforest an adequate area for their consumption, compensation areas of over 680 ha or almost 7 square kilometres of forest would have to be created. Per year. And to better understand the area, it is easier to express it in football pitches: the authorities of a single federal state would have to reforest almost 1000 football pitches annually. Only one small German state out of 16.
Network effects of electronic invoices
The problem is not one company, but all companies and authorities. Electronic invoices must be processed by the computer. Unlike us humans, this requires a uniform format. This has slowed growth in recent years. However, in order to increase the acceptance of e-bill, its distribution must increase. This is a classic network effect. As more companies are able to use and process digital invoices, more subscribers will use e-bills. In other words, all beginnings are difficult until a critical mass is reached. To speed up this process, the EU recently adopted a directive requiring Member State authorities to make digital invoicing mandatory. That means that in the future, everyone who wants to do business with the authorities in Hesse (or elsewhere), should digitize their invoicing.
We now work with a large number of standards and can connect all customers to each other. Setup is quick and easy. As a company, you do not need to install any additional software to set it up. Instead, you benefit from our modular cloud solutions. Environmental protection can be so simple. As a company, you increase your efficiency, reduce process costs and protect the environment at the same time.
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