Scope 2 emissions are indirect greenhouse gas emissions associated with the purchase of electricity, steam, heat, or cooling. Unlike Scope 1 emissions, which are direct emissions from owned or controlled sources, Scope 2 emissions occur at the facility where the energy is generated, rather than at the point of energy consumption by the reporting company.
Scope 2 covers indirect emissions from the generation of purchased energy, including:
These are produced during the generation of purchased electricity that is consumed by a company. This is the most common source of Scope 2 emissions.
This is used in industrial processes or for heating, emissions from the production of purchased steam.
These are emissions from the generation of purchased heating or cooling that is distributed via district networks.
Scope 2 emissions are calculated by multiplying the amount of purchased energy by the GHG emission factor associated with generating that energy. There are two methods for calculating these emissions:
This uses grid-average emission factors to reflect the average emissions intensity of grids on which energy consumption occurs.
This reflects emissions from electricity that companies have purposefully chosen or contracted, using emission factors that reflect the specific types of energy procured. This method can include specific renewable energy purchases and is useful for showing the effects of renewable energy choices on a company’s emissions footprint.
Managing Scope 2 emissions is crucial for several reasons. It helps organizations understand the broader impact of their energy use, beyond just their direct energy consumption. Reducing energy use and increasing energy efficiency can also lead to significant cost savings, especially in regions with high energy costs or carbon pricing mechanisms. Lastly, demonstrating commitment to reducing indirect carbon emissions can improve relations with stakeholders, including investors, customers, and environmental groups.
By addressing Scope 2 emissions, companies not only reduce their indirect carbon footprint but also contribute to the transformation of the wider energy system towards a lower carbon future.
Reducing Scope 2 emissions often involves the following strategies:
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