Scope 1, 2, and 3 Greenhouse Gas Emissions. Businesses are responsible for the largest part of worldwide greenhouse gas (GHG) emissions. To measure and effectively regulate these emissions, governments, research institutes, and industry and non-profit organizations have developed a common concept based on the Greenhouse Gas Protocol. The protocol divides GHG emissions are divided into three categories for businesses and organizations – Scope 1, Scope 2 and Scope 3.
Either voluntarily or mandatorily by following regulations, companies need to cut emissions across all three scopes to meet internationally agreed targets on global warming. Thus, it is important to understand the concept behind the different scopes in order to assess businesses’ carbon footprint and always compare apples to apples when assessing businesses environmental performance, either benchmarked against internal goals or vis-à-vis peers in the industry or country.
Scope 1 emissions are “direct” emissions – that a business causes by its owned and controlled operations through, for example, of running machines, vehicles, or heating and powering its facilities. These emissions can be cut by producing less or using greener production technologies.
Scope 2 emissions are “indirect” emissions – that are created by the production of the energy purchased by the business to run its operations. These emissions can be cut by using company-owned solar panels or sourcing a higher share of renewable energy from energy providers.
Scope 3 emissions are also “indirect” emissions – that are caused by customers using the business’s products (downstream) or by suppliers making products that the business uses as inputs (upstream). These emissions are often the largest of all three categories. They can be cut by producing and selling products that are more energy-efficient and by sourcing inputs from environmental-friendly suppliers. As these emissions are indirect, cutting them requires companies to track the environmental effects of product use (downstream) and the emissions of suppliers’ production process (upstream).
The World Economic Forum writer Simon Read has summarized and illustrated the concept behind Scope 1, 2, and 3 emissions here.
Marcel Olbert 