Carbon software company claims broad patent

Verisae, a small Minnesota-based company, has received a patent for a system to track and report greenhouse gas emissions with software, a business attracting a growing field of companies.

The company on Wednesday said that the U.S. Patent and Trademark Office issued a patent to Verisae for a method for calculating a corporation's emissions. The patent, filed in May of 2007, describes a business process for gathering corporate emissions data, generating reports, and managing carbon credits.

Verisae is already offering hosted carbon accounting software focused primarily on retail companies, basing its tracking and reporting on the protocols established by the nonprofit Climate Registry, which sets guidelines for emissions reporting.

"This is a shot across the bow to others building this stuff," said Verisae product manager Daniel Stouffer. "This is a big story for those venture capital companies which might be spending money with firms that might be building solutions that might already be covered."

Verisae's hosted software compiles the greenhouse emissions data from a corporation's different assets. For example, a refrigerator in a store has emissions associated with its energy use and the refrigerant which is a powerful greenhouse gas, Stouffer explained.

The company is also working on a way for businesses to monetize incentives to reduce emissions, Stouffer said. Businesses can make money by participating in demand response programs, where the utility reduces the electrical load of the business--such as turning down lights in a supermarket or cooling in a building--during peak times.

Reason for worry?
The patent disclosure comes at a time of heightened interest around carbon emissions-related software. Investors expect that this year will see a lot of activity in software for tracking and reporting greenhouse gases, sometimes called carbon accounting software.

On Monday, start-up Hara Software, backed by venture capital firm Kleiner Perkins Caufield & Byers, announcedits Web-based software. SAP purchased another carbon accounting company, Clear Standards, earlier this year in a sign of consolidation among providers.

The claims of Verisae's patent appear to describe a fairly general method for managing a business' greenhouse gas emissions. But how broadly it can be enforced is unclear, said patent attorney Eric Lane in the clean-tech practice at Luce, Forward, Hamilton & Scripps.

The claims on the patent include a number of different processes, noted Lane, who examined the patent and some related documents. That means that another carbon software company could develop a product that doesn't combine all of Verisae's claims.

Still, Lane said that the patent is worth noting for the growing number of carbon accounting software companies.

"Whether other companies ought to be worried is hard to say. Should they be aware of this? Yes," Lane said. "They have a nice package."

Growing field
Patents around different forms of carbon accounting have seen a surge in the past year, according to a recent study. In programs designed for trading carbon permits, there were six patent familes in 2000, nine in 2002, and 15 in 2006.

A significant case likely to affect carbon software is a decision by the federal appeals court that made it harder to claim business process patents often implemented in software applications, Lane said.

Part of the reason for the uptick in carbon accounting software is the expectation that heavy polluters in the U.S. will be need to comply with looming regulations to cap greenhouse emissions.

The American Clean Energy and Security Act of 2009 bill calls for the creation of a cap-and-trade program to limit emissions. But the earliest a bill would pass is next year and caps on carbon emissions would be phased in over many years.

Even before a national U.S. mandate, companies are investing carbon-tracking software as part of corporate sustainability programs or to administer energy efficiency initiatives.