What are Scope 2 emissions and how are they measured?

Scope 2 emissions refer to indirect greenhouse gas emissions from generated purchased electricity, steam, heating, and cooling that an organisation uses.

While these emissions occur at power plants or other facilities outside the organisation, they are attributed to the organisation because it consumes the energy produced.

Scope 2 emissions are measured through two primary approaches:

Location-Based Method

This method calculates emissions based on the average fuel mix of the electricity grid serving the organization’s location.

How It Works:

• Gather Electricity Consumption Data: Collect data on the amount of electricity consumed at each facility.
• Understand Grid Characteristics: Determine the energy mix of the local grid, which includes the proportions of different energy sources (e.g., coal, natural gas, renewables).
• Calculate Emissions: Apply the average carbon intensity of the local grid to the electricity consumption data to estimate emissions.

Example: If a company operates in an area where the electricity grid is primarily powered by coal, its location-based emissions will reflect the higher carbon intensity associated with coal-fired power.

Market-Based Method

This approach calculates emissions based on the specific electricity purchases made by the organisation, considering contracts and the energy mix of its suppliers.

How It Works:

• Request Electricity Bills: Obtain detailed bills or reports from energy suppliers that include information on the fuel mix of the purchased electricity.
• Collect Consumption Data: Record the total kilowatt hours (kWh) of electricity consumed.
• Analyse Fuel Mix: Review the provided fuel mix data to identify the proportions of various energy sources used by the supplier.
• Calculate Emissions: Use this information to calculate emissions based on the specific energy sources purchased.

Example: If a company buys electricity from a supplier that provides 100% renewable energy, its market-based emissions will be lower compared to if it purchased electricity from a supplier with a higher proportion of fossil fuels.

In summary, Scope 2 emissions measurement helps organizations understand the environmental impact of their electricity use. The location-based method provides a standardized measure based on the regional grid’s average fuel mix, while the market-based method offers a more tailored view based on specific energy procurement choices.