There is a lot of talk around scope 1,2 and 3 emissions. But what are they, why is it important and how does it affect me?
It all starts with the EU regulations on climate change. Under ESRE reporting, the section E1 Climat change, companies are requested to report their Scope 1, Scope 2, and Scope 3 (sections E1-7 to10). But what are scope 1 2 and 3 emissions, and why are there different categories? It might look complex, but at the end it is an elegant and useful distinction. Let’s dive in!
Scope 1 emissions refer to direct emissions from sources that are owned or controlled by the reporting entity. Activities such as on-site combustion of fossil fuels in boilers, furnaces, vehicles, and other equipment. Examples of Scope 1 emissions are the carbon dioxide (CO2) emissions from a company’s own fleet of vehicles or the emissions from an on-site power generation facility. Think about the heating in your office, the natural gas for your bread oven and the fuel for the trucks you use to bring your product to the customers.
Scope 2 emissions are indirect emissions generated from the consumption of purchased energy. These emissions result from the production of electricity, heat, or steam purchased by the reporting entity, but you are the “user” of these emissions, since you use the electricity that generated them. Think about the purchased electricity from the grid for the lights in the office, and for instance city heating. While you do not directly control these sources, they are considered indirect emissions associated with the organization’s activities.
Scope 3 emissions are the interesting ones. They include all other indirect emissions that occur in your value chain both upstream and downstream. Think about emissions associated with producing the raw materials you purchase, the transport of these materials to your plant as examples of upstream emissions. Business travel and employee commuting, the use of your products and the end-of-life disposal of your products would be examples of downstream emissions.
For instance, if you sell mobile phones, laptops and printers, the scope 3 emissions of your company would include all the electricity these devices will use over their lifetime! Scope 3 emissions often represent the largest portion of a company’s total carbon footprint and usually is the most challenging to quantify due to the complexity of the value chain.
By categorizing emissions into these three scopes, organizations gain a comprehensive understanding of their environmental impact, enabling targeted efforts to reduce emissions under their control (scope 1 and 2) and improve overall sustainability by targeting scope 3 emissions. Many companies are increasingly recognizing the importance of addressing the full value chain of their carbon footprint and work with suppliers, customers and partners to achieve meaningful progress in mitigating climate change.
This was a short explaination on scope 1 2 3 emissions. There is a lot more to tell about it, so please do not hesitate to leave a comment if you want to find out more!