CLEARPATH INSIGHT

Scope 1, 2 and 3 Emissions: Where Should an Organization Start?

Understand the building blocks of a credible corporate GHG inventory and how Scope 1, 2 and 3 fit together.

Organizations often know they need a GHG inventory but are unsure where to begin. The answer is to establish the inventory boundary first, then systematically identify sources and activity data.

Scope 1: direct emissions

Scope 1 covers direct emissions from sources owned or controlled by the reporting organization. Examples include fuel combustion in owned equipment and certain process emissions.

Scope 2: purchased energy

Scope 2 covers indirect emissions associated with purchased electricity, steam, heat and cooling. The accounting approach needs to match the reporting context and available contractual or grid information.

Scope 3: the value chain

Scope 3 covers other indirect emissions in the organization’s value chain. It can be the most data-intensive part of an inventory, so screening and prioritization are often useful first steps.

A practical starting sequence

  1. Define the organizational boundary.
  2. Map major emissions sources.
  3. Identify available activity data.
  4. Select appropriate emissions factors.
  5. Calculate and quality-check the inventory.
  6. Use the results to identify material reduction opportunities.
Key takeaway: A useful GHG inventory is a management tool, not just a reporting exercise.

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