Distinguishing scope 1, scope 2, and scope 3 emissions

When you embark on the journey to shrink your organization’s carbon footprint, you’ll encounter an array of carbon initiatives tackling the often-discussed trifecta: scope 1, scope 2, and scope 3 emissions.

Scope 1, 2, and 3 emissions are the three classifications of emissions most commonly used to explain carbon dioxide emissions (and other greenhouse gasses), and understanding the different types is essential to knowing where you’re making strides in reducing them. 

The EPA defines the scopes as follows:

• Scope 1 Emissions: These are direct greenhouse gas emissions that result from sources owned or controlled by an organization. Examples of scope 1 emissions include emissions from on-site combustion processes and mobile sources, such as company-owned vehicles.
• Scope 2 Emissions: These are indirect greenhouse gas emissions that result from the consumption of purchased energy, such as electricity, heat, or steam. Although scope 2 emissions physically occur at the facility where they are generated, they are considered indirect emissions because they result from the organization’s energy consumption.
• Scope 3 Emissions: These are incidental emissions and are a result of activities from assets not owned or controlled by the reporting organization, but that the organization utilizes in its value chain. Product transportation, employee business travel, and employee commuting are examples of scope 3 emissions.

To put it simply, scope 1 emissions are direct emissions from on-site combustion and mobile sources, scope 2 emissions are indirect emissions from purchased energy, and scope 3 emissions are optional emissions that occur outside of an organization’s direct control.

Different approaches to addressing emissions

Comprehensively reducing greenhouse gas emissions requires addressing all three classifications of emissions. Scope 1 and 2 emissions are relatively straightforward to evaluate.

Scope 3 emissions, on the other hand, are much more difficult to quantify – they include a wide range of activities that occur outside of an organization’s direct control, such as transportation and shipping costs, employee commuting, and the use of sold products.

Their nebulous nature and difficulties in accounting have resulted in some uncertainty and debate for reporting organizations and governmental entities, such as the SEC, as the carbon accounting landscape evolves.

Companies use different carbon neutralization strategies to eliminate their varying scopes. The following table highlights how the most popular strategies apply to each type of emissions:

🥇 indicates real-world carbon impact and satisfaction of accounting standards; 🥈 satisfies accounting standards, with uncertain or ill-defined real-world impact. 

🥇 indicates technological preparedness at scale and at cost, 🥈 indicates technological potential, but shortcomings in scale or cost.

Taking a credible approach

Companies committed to reducing their entire carbon footprint must take a comprehensive and holistic approach, which includes accurately measuring all three scopes, including indirectly accrued scope 3 emissions. 

Understanding the different approaches to addressing emissions can help organizations identify the most effective strategies for reducing their environmental impact. If your company’s customers, employees, and stakeholders want the action you take to meaningfully and verifiably contribute to a more sustainable future, you want solutions that accomplish real-world reduction for all three classifications of emissions (scope 1, 2, and 3). 

By utilizing innovative solutions like Climate Vault that address all aspects of everyday operations, companies like yours can reduce their carbon footprint, demonstrate their commitment to taking on climate change, and improve their sustainable business operations.

You can receive a bespoke corporate carbon footprint estimate that includes your scope 1, 2, and 3 emissions. Climate Vault is here to help you comprehensively address your emissions and take charge of your carbon goals.