Greenhouse gas (GHG) emissions are categorized into three scopes by the Greenhouse Gas Protocol (GHGP), a widely used international standard. Scope 1 includes direct emissions from owned or controlled sources, Scope 2 covers indirect emissions from the generation of purchased electricity, and Scope 3 encompasses all other indirect emissions that occur in a company’s value chain. Scope 3 emissions are often the largest portion of an organization’s total emissions and the most challenging to measure and manage. This article outlines a structured approach to account for Scope 3 emissions, helping organizations understand their impact and identify opportunities for reduction.
Understanding Scope 3 Emissions
Scope 3 emissions include a broad range of indirect emissions that occur both upstream and downstream in the value chain. They are categorized into 15 distinct types:
- Purchased goods and services
- Capital goods
- Fuel- and energy-related activities not included in Scope 1 or 2Upstream transportation and distribution
- Waste generated in operations
- Business travel
- Employee commuting
- Upstream leased assets
- Downstream transportation and distribution
- Processing of sold products
- Use of sold products
- End-of-life treatment of sold products
- Downstream leased assets
- Franchises
- Investments
