Scope 1, 2 and 3 emissions: a quick guide

Whether you are reporting under a mandatory scheme such as SECR or setting a voluntary net zero target, your emissions should be categorised into scopes. So what are the three scopes? 

Scope 1

Scope 1 emissions are those that come directly from sources owned or controlled by your organisation. Examples of Scope 1 emission sources include (but aren’t limited to): 

  • An on-site furnace burning gas; 
  • An employee driving a petrol car as part of their work; 
  • Refrigerant gases from air-conditioning or chillers on site; 
  • Methane from livestock. 

Scope 1 emissions are also known as direct emissions.  

Scope 2

Scope 2 emissions are indirect emissions arising from your organisation’s consumption of purchased energy. If a supermarket pays an energy supplier to keep the lights on and the fridges running, the emissions arising from this activity are in Scope 2. The supermarket is responsible for these emissions because they happen as a direct result of the company’s activities, even though the actual emissions might be generated at a power station many miles away from the supermarket itself.  

Scope 2 emissions are also known as indirect emissions, because you don’t own or control the energy source.   

Scope 3

Scope 3 emissions are those arising from sources connected to a business, rather than from the business itself. Examples of Scope 3 emission sources include: 

  • Suppliers providing raw materials to the business; 
  • Transport services used for a company’s logistics; 
  • Waste disposal and recycling services; 
  • Employees commuting to work. 

The GHG Protocol divides Scope 3 emissions into 15 distinct categories, eight of which are “upstream” of the organisation’s operations (such as purchased goods) and seven of which are “downstream” (such as the processing of sold products). Our Scope 3 FAQ page has the full list.  

Scope 3 emissions are also known as value chain emissions or third-party emissions.  

Why have three scopes?

The categorisation of emissions into three scopes is an acknowledgement that the level of control an organisation has over its emissions can vary greatly, depending on how the emissions are created. Having three scopes makes your emissions data much more detailed and useful. It also allows carbon reporting schemes and carbon reporting strategies to have a different approach for each type of emission.  

Having Scope 2 emissions as their own category allows for nuance over the issue of energy sourcing. As our SECR FAQs explain, organisations reporting under SECR could technically declare zero emissions for Scope 2 if they are on a 100% renewable electricity tariff. However, the reality is somewhat more complex because you can’t actually control what mix of energy sources is coming from the grid to power your sites at any one time. This is why the official SECR guidance recommends offering more detail in your reporting.  

Scope 3 and SECR 

Scope 3 emissions are acknowledged to be the most difficult to measure and control, which is why they are often treated differently from Scopes 1 and 2. Many businesses have one deadline for reaching net zero with Scopes 1 and 2, and a more distant deadline for the trickier-to-abate Scope 3 emissions.   

At present, almost all Scope 3 emissions can be ignored for the purposes of SECR, with one exception: petrol or diesel emissions arising from work-related travel if the vehicle is either a rental or belongs to an employee of your organisation (and they buy the fuel). Even this is only compulsory to report for large unquoted companies and large LLPs; quoted companies have absolutely no Scope 3 reporting obligations.  

However, if you are setting an emissions reduction target, this won’t meet the standards of any recognised scheme unless it includes Scope 3. For example, the Science-Based Targets initiative makes it mandatory to include Scope 3 emissions if they make up over 40% of your total emissions – and they almost always do.  

The reality for most organisations is that Scope 3 emissions are likely to make up over 80% of your total, probably over 90%. Your organisation may be one of the very rare exceptions, but in that case you’ll still need to measure your Scope 3 emissions to be sure of this. In other words, getting to grips with Scope 3 is essential for a valid climate strategy.  

There are also significant business benefits to reporting your Scope 3 emissions, which is why many organisations are doing it voluntarily.  

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