What are scope 1, 2, and 3 emissions?

February 26, 2021

Measuring and tracking emissions are essential to reducing your carbon footprint.

Scope 1, 2, and 3 emissions explainer

According to the EPA, transportation and electricity—two essential functions for most businesses—produce over half of emissions in the U.S.  

For a business to honestly care about sustainability, measuring and tracking emissions are essential to reducing its carbon footprint. But GHG emissions are about more than what comes out of an exhaust pipe or a smokestack.

The GHG Protocol divides emissions into three scopes:

Scope 1 – direct emissions from sources owned or controlled by a company

Scope 2 – indirect from energy that’s purchased  

Scope 3 – all other emissions associated with a company’s activities

While measuring scope 1 and 2 emissions might be the easiest to measure, tracking what is often the largest culprit of a company’s carbon footprint—Scope 3 emissions—tends to be more nebulous. Scope 3 emissions include an array of elusive carbon-emitting activities that, when added up, often account for more significant emissions than Scopes 1 and 2 combined.

If a company truly intends to reduce or even eliminate its carbon footprint, it must address all three scopes and pay special attention to scope 3.

Graphic explaining Scope 1, 2, and 3 emissions

What activities scope emissions include

Scope 1 – Emissions that result from fuel burned in company-owned assets, such as buildings, vehicle fleets, and factories. Scope 1 also includes accidental emissions like refrigerant leaks and evaporated fuel.  

Scope 2 – Emissions from the consumption of purchased energy, including electricity, steam, heating, and cooling. Think of these as the emissions your company indirectly creates by needing to keep the lights on or functioning.  

Scope 3 – This includes all other indirect emissions associated with a company’s upstream and downstream operations. Unless a business has significant real estate holdings and energy consumption, scope 3 typically represents the most significant contributor to a company’s carbon footprint because it includes things like:  
• Business travel (e.g.air travel, daily commutes)
• Waste
• Purchased goods and services
• Transportation and distribution tied to suppliers and customers
• Capital goods, investments, and franchises  
• Leased assets
• Emissions from the use of a product or service sold
• Product’s end of life (when it’s no longer useful)

Why measure scope emissions?

Measuring your emissions is critical to understanding your company’s carbon footprint and impact. It’s also good for business because it requires a deepened understanding of every part of your business, including deliberate engagement with your supply and value chains and strong stakeholder relationships. While carbon accounting might seem daunting, the first step is to identify areas ripe for improvement: efficiency opportunities, waste reduction, or ways to streamline procurement or other essential activities.  

The America’s recommitment to the Paris Climate Agreement has set the stage for a new emission accounting era, likely bringing additional regulatory standards. Quantifying your scope emissions now will not only help you stay ahead of the legislative curve but also help you maintain a competitive advantage for customer and employee retention.

Sustain.Life helps organizations of all sizes calculate understand their emissions-emitting activities. Sign up for a free trial below.

Start your own sustainability plan in 30 minutes

Free trial for our sustainability management software

More from Sustain.Life
Sustain.Life Team
Energy & emissions
Product footprint
Sustainability basics
Key takeaways

• Scope 1 emissions – direct from sources owned or controlled by a company

• Scope 2 emissions – indirect from energy that’s purchased  

• Scope 3 emissions – all other emissions associated with a company’s activities