What are the GHG Protocol and scope emissions?

Mitigating negative environmental impact has become a business imperative for companies. One of the most significant ways to do this is by reducing their carbon footprint, which starts with monitoring greenhouse gas (GHG) emissions.

What is the GHG Protocol?

Established in 1998, the Greenhouse Gas Protocol (GHGP) provides a globally standardized framework to measure and manage GHG emissions from private and public sector operations, value chains and emission reduction actions. It was formed through a partnership between the World Resources Institute and the World Business Council for Sustainable Development because of the need for a consistent framework for greenhouse gas reporting.

Supplying the world's most widely used greenhouse gas accounting standards, the GHG Protocol was used by 92% of Fortune 500 companies directly or indirectly through a program based on GHG Protocol in 2016.

GHG Protocol Corporate Standard‍

The GHG Protocol Corporate Accounting and Reporting Standard provides guidance for companies on how to quantify and report their GHG emissions. Through standardized approaches to emissions evaluation, the GHG Protocol enables companies to reduce the costs of creating a GHG inventory, and increase transparency and consistency in the reporting process.

Scope emissions

According to the GHG Protocol, a company's greenhouse gas emissions are divided into three scopes. Scope 1 and 2 are mandatory to report, while scope 3 is voluntary and the most difficult to monitor. However, companies that manage to report on all three areas gain a sustainable competitive advantage.

Scope 1

  • Direct GHG emissions that a company produces and controls
  • Emitted through fuel combustion by company-owned facilities and vehicles, etc.
  • Examples: Air conditioning in office buildings, on-site manufacturing

Scope 2

  • Indirect GHG emissions that a company produces by its use of electricity and power
  • Emitted through power plants that supply the company with its electricity, steam, heat and cooling demand
  • Example: Purchased electricity

Scope 3

  • Indirect GHG emissions that occur up and down the company’s value chain and are not included in scope 2
  • Emitted through company’s value chain: suppliers, employees, business travel, use of company products etc.
  • Examples:
    • Upstream: Purchased goods & services, employee commuting
    • Downstream: Investments, franchises

The majority of corporate emissions come from Scope 3 sources, but a reduction in this scope is limited because Scope 3 emissions are the most difficult to measure. There are multiple calculation methods using documented emission factors with varying results. The basic methods have a lower quality scope, while the more specific methodology has higher quality but is more time- and labor-intensive.

Source: About Us | Greenhouse Gas Protocol (ghgprotocol.org)

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