What are Scope 1, 2 and 3 Carbon Emissions?

Carbon emissions in the atmosphere pose serious risks not just to the health, but the very existence of populations across Earth. These carbon emissions are part of the greenhouse gases that, when released into the atmosphere, cause global warming and climate change effects.

The major contributors of carbon emissions are big organizations, industries and companies. Hence, it is important to regulate and reduce their carbon emissions. Besides, a company must then take steps to record and measure their emissions from all sources.

Finally, they are required to implement strategies to reduce and eliminate carbon emissions. This will be a step towards becoming carbon neutral or achieving net-zero.

To be able to measure carbon emissions, it is important to understand its different categories. In this article we will learn about the different categories or "scopes" of emissions with some examples.

Based on their sources, greenhouse gases are divided into three different scopes.

• Scope 1: Direct emissions from sources owned or controlled by a company
• Scope 2: Indirect emissions from purchased electricity, steam, heat, cooling
• Scope 3: Other emissions associated with a company’s activities

In 2001, the Greenhouse Gas Protocol (GHGP) was established by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) to simplify emissions tracking and assist businesses in finding ways to decrease their emissions.

The GHGP divides all emissions into three scopes. While reporting emissions from scope 1 and 2 is mandatory for many countries and organizations, measuring scope 3 emissions is often optional.

Alyssa Rade, the chief sustainability officer at Sustain.Life simplifies these 3 scopes: "Burn, Buy, Beyond. Scope 1 is what you burn; scope 2 is the energy you buy; and scope 3 is everything beyond that."

Scope 1 Emissions

Let's take a cloth manufacturer for example. The scope 1 emissions include the direct emissions from the factory such as fuel used to power their equipment, emission from company vehicles, etc. Whatever energy is burned directly by the company falls under Scope 1 emissions.

Direct emissions from sources owned or controlled by a reporting company are Scope 1 Emissions. They result from the combustion of fuels on-site.

Scope 1 Emissions include:

• Accidental or fugitive emissions like chemical and refrigerant leaks and spills
• Fuel to heat or power buildings, vehicles and other equipment
• Propane, lubricants, vegetable oil, biomass like wood and any other fuels

Some examples of scope 1 emissions are businesses with a physical footprint:

• Brick-and-mortar stores, factories, office buildings, and company-owned vehicles and equipment.
• Real estate enterprises or manufacturers with several factories have significant scope 1 emissions.
• A brewery for example, uses fuel to power forklifts, brewery equipment, and heat and cool the building. All of these contribute to its scope 1 emissions.

Equipment or assets that support any organizations, but that are not owned or controlled by that organisation, doesn’t fall under scope 1 emissions.

Since organizations have direct control of emissions created on-site, scope 1 emissions are typically the easiest to manage and mitigate.

Scope 2 Emissions

Scope 2 emissions are indirect emissions generated from purchased energy, including:

• Electricity - purchased electricity from a utility or another supplier.
• Heat - district heating systems, not heat generated on-site by using a boiler or furnace.
• Steam - used in industrial processes.
• Cooling - district cooling systems, not cooling a facility with an electricity-powered AC unit.

Some examples of Scope 2 Emissions include energy that is consumed or emitted from rented or leased:

• Office spaces
• Vehicles
• Fuel or electricity necessary to run heavy equipment

Scope 3 Emissions

Finally, the cloth manufacturer measures his scope 3 emissions by considering the energy required to grow the material, process cotton fibres, transit miles taken to deliver the raw materials, energy used by consumers to wash and dry the clothing and the GHG emissions generated as the materials decay in a landfill, etc.

Scope 3 emissions are all the other emissions associated with a company's activities. It is important for companies and organizations to take scope 3 emissions into account as they make up roughly 90% of an emissions footprint.

There are 15 categories of upstream and downstream activities throughout the value chain that make up scope 3 emissions:

Upstream: In Production of a Product

• Purchased goods and services
• Capital goods
• Fuel and energy related activities
• Transportation and distribution
• Operational waste
• Business travel
• Employee commuting
• Leased assets

Downstream: In Consumption of a Product

• Transportation and distribution
• Processing of sold products
• Use of sold products
• End-of-life of sold products
• Leased assets
• Franchises
• Investments.

You can manage only what you can measure. Now that you are aware of the different categories of emissions, you are a step closer to managing and reducing your organizations carbon emissions.

By individually calculating each scope's total emissions, you can accurately report the progress of your company targeting to reduce its GHG emissions.

The World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) developed The Greenhouse Gas Protocol in 1998 as a standard for measuring and reporting emissions.

It is the most widely used international protocol adopted by governments, industry associations, nonprofit agencies and corporations. Brazil, India, Mexico and the Philippines all employ GHG Protocol-based systems to collect valuable emissions data.

Identifying scope emissions can also help you understand which section needs to be focused on to make it more carbon efficient.

Scope 1 and 2 emissions are mandatory to report, while scope 3 emissions are voluntary and the most difficult to monitor. However, scope 3 emissions are what make up most of a company's carbon footprint.

Hence, if an organization wants to truly become carbon neutral or achieve net zero, they will have to pay attention and include scope 3 emissions in their carbon accounting strategy.

While GHG or carbon accounting might seem daunting, it should be the first step in a company's sustainable development journey.

There are many platforms that help organizations in this field. Organizations can focus on efficient opportunities, waste reduction opportunities or ways to streamline procurement or other essential activities.

Measuring scope emissions can help organizations:

• Identify emission hotspots
• Assess their supplier's sustainability performance
• Improve the energy efficiency of their products
• Comply with regulations
• Contribute to a strong environmental, social and governance (ESG) strategy
• They can also increase brand credibility

Controlling scope emissions is no easy feat. Companies need to look at what operations emit most carbon and which take most energy. Efficiency is key in streamlining any business process.

To reduce scope emissions, organizations can:

• Work with stakeholders and look at ways to reduce transportation miles
• Switch to equipment and tools powered by sustainable electricity
• Look into alternative heating sources for buildings
• Prioritize energy efficiency projects
• Switch to renewable energy and energy certificates to account for the portion of electricity load

Accurately scope emissions will only help better organizations and brand in the public favour. Although it might seem like a tedious process, it is an important step towards sustenance and growth.