Scope 2 Emissions
Definition
Scope 2 emissions are indirect greenhouse gas emissions from the generation of purchased electricity, steam, heating, and cooling consumed by the reporting organisation. They occur at the facility where the energy is generated, not where it is consumed. Companies can reduce Scope 2 emissions by switching to renewable energy sources.
Why It Matters
Scope 2 emissions often represent a significant portion of a company's carbon footprint, especially for service-sector organisations. Transitioning to renewable energy procurement is one of the most impactful strategies for cutting Scope 2 emissions.
Related Terms
Scope 1 Emissions
Scope 1 emissions are direct greenhouse gas emissions from sources owned or controlled by an organisation. These include emissions from on-site fuel combustion, company vehicles, and industrial processes. They are the most straightforward emissions for a company to measure and reduce.
Scope 3 Emissions
Scope 3 emissions are all indirect greenhouse gas emissions that occur in a company's value chain, both upstream and downstream. They include emissions from purchased goods, business travel, employee commuting, waste disposal, and use of sold products. For most companies, Scope 3 represents the largest share of their total emissions.
Renewable Energy
Renewable energy is energy derived from natural sources that are replenished at a rate faster than they are consumed, such as solar, wind, hydroelectric, geothermal, and biomass. Unlike fossil fuels, renewable sources produce little to no direct greenhouse gas emissions during operation. The transition to renewables is central to global decarbonisation efforts.
Carbon Footprint
A carbon footprint is the total amount of greenhouse gas emissions caused directly and indirectly by an individual, organisation, event, or product. It is usually expressed in tonnes of carbon dioxide equivalent (tCO2e). The measurement encompasses emissions across an entity's entire value chain.