What is the difference between activity data and spend data?

When collecting data for carbon footprinting, you may encounter two primary types of data: activity data and spend data. Each serves a different purpose and has varying levels of accuracy when calculating emissions.

Activity Data refers to direct measurements of the resources your organisation uses. This could include specific quantities of energy consumption, like kilowatt-hours (kWh) of electricity used, or the miles/kilometers travelled by company vehicles. Other examples might include the amount of natural gas consumed, litres of fuel used for heating, or tons of waste generated.

Advantages of Activity Data:

• It provides a highly accurate and detailed picture of your carbon emissions because it is based on real, measured usage.
• Since it reflects actual consumption, it allows for precise emission calculations, reducing the risk of over or underestimating your carbon footprint.
• For organisations seeking to make informed decisions about reducing their emissions, activity data is critical because it helps pinpoint where emissions are highest and where reduction efforts can have the greatest impact.

Challenges of Activity Data:

• Collecting activity data can sometimes be challenging, especially if your organisation lacks centralised systems or needs to coordinate with multiple departments or suppliers.
• You may also need to gather data from a variety of sources, such as utility bills, transportation logs, or waste management reports, which can be time-consuming and require collaboration across the business.

Spend Data, on the other hand, looks at the financial expenditures your organisation makes for particular activities, such as the amount spent on fuel, electricity, or business travel. Instead of tracking exact usage, spend data estimates emissions based on how much money you have spent in different categories. For example, if you know how much you’ve spent on fuel in a month, you can estimate the related emissions using average emission factors.

Advantages of Spend Data:

• Spend data can be useful as a secondary option when activity data isn’t available or is difficult to obtain. It provides a rough estimate of your emissions without requiring detailed tracking of every activity.
• It is often easier to collect because it is based on financial records, which are typically readily available from departments like finance or procurement.

Challenges of Spend Data:

• Spend data is less accurate because it is influenced by variables like market prices, regional price differences, and seasonal fluctuations. The price you pay for a resource doesn’t always correlate directly with the amount of resource consumed.
• It’s also more difficult to break down spend data into specific emission sources, which makes it less useful for identifying where exactly emissions reductions can be made.
• While it provides a broad estimate of emissions, it is not precise enough to inform targeted reduction strategies in the way that activity data can.

Which Should You Use?
For the most accurate carbon footprint calculation, activity data is always preferred. It offers a clear, detailed insight into your actual resource usage and emissions output. However, when activity data isn’t available—perhaps because certain systems or records are incomplete—spend data can be used as a supplementary source to estimate emissions.

In practice, many organisations may use a combination of both. For some activities, you might have precise activity data (e.g., energy usage from utility bills), while for others, spend data may be the only available option (e.g., money spent on flights or fuel if mileage isn’t recorded). 

Whenever possible, prioritise gathering activity data, but spend data can fill gaps and provide useful insights when activity-based measurements are not feasible.