Scope 1, Scope 2, and Scope 3 are categories used to classify and account for different types of greenhouse gas emissions, including carbon dioxide (CO2), associated with an organisations activities. These categories were developed by the Greenhouse Gas Protocol, a widely used standard for greenhouse gas accounting. They help organisations understand and manage their emissions more comprehensively. Here’s an explanation of each scope:
Scope 1 Emissions: Direct Emissions
Scope 1 emissions are direct greenhouse gas emissions that result from sources that are owned or controlled by the organisation. These emissions are generated from activities that are directly within the organisation’s operational boundaries. They include:
Essentially, Scope 1 emissions cover emissions that are generated from activities directly managed by the organisation.
- Emissions from the combustion of fossil fuels on-site (e.g., in company-owned boilers or vehicles).
- Emissions from industrial processes that occur on-site.
- Emissions from owned or controlled chemical reactions.
Scope 2 Emissions: Indirect Emissions from Energy Consumption
Scope 2 emissions are indirect greenhouse gas emissions that result from the generation of electricity, heating, cooling, or steam purchased by the organisation. These emissions occur outside the organisation’s operational boundaries but are a consequence of the organisation’s energy consumption. They are categorised as indirect because the emissions occur at a different location (e.g., a power plant) than the organisation’s direct activities. Scope 2 emissions are often associated with electricity consumption and are categorised into three “market-based” or “location-based” categories depending on how an organisation procures its electricity:
- Market-Based Emissions: These are emissions associated with the actual sources of electricity and energy consumed by the organization. If an organisation buys renewable energy certificates or generates its own renewable energy, it can reduce its market-based Scope 2 emissions.
- Location-Based Emissions: These are emissions associated with the average emissions factor of the electricity grid in a specific geographic region.
Scope 3 Emissions: Indirect Emissions from Value Chain Activities
Scope 3 emissions are a broader category of indirect greenhouse gas emissions that result from activities in the value chain of the organisation but are outside its operational control. These emissions include a wide range of sources, such as:
Scope 3 emissions can be the most challenging to quantify and manage because they often involve complex relationships with suppliers, customers, and other stakeholders.
- Emissions from purchased goods and services, including the entire lifecycle of products.
- Emissions from transportation and distribution of products.
- Emissions from employee commuting.
- Emissions from waste generated by the organisation.
Understanding and addressing all three scopes of emissions is important for a comprehensive approach to carbon management and sustainability. While Scope 1 and Scope 2 emissions are more directly under an organization’s control, Scope 3 emissions provide insights into the broader environmental impact of an organization’s activities throughout its value chain.