What Are Scope 1, 2, and 3 Emissions and How Can Data Support Your Emissions Reporting?

Today, one quarter of global greenhouse gas (GHG) emissions are from the transportation sector and 95% of the world’s transportation fuel is from fossil fuels. In order to mitigate the effects of climate change, control costs, and build resiliency against fossil fuel dependency, organizations are taking a closer look at their carbon footprint for opportunities to reduce emissions and operate more sustainably.

An organization’s carbon footprint is the amount of total emissions associated with a particular entity, activity, or product as a key indicator of environmental impact. Scope 1, 2, and 3 emissions represent different categories of direct and indirect greenhouse gas emissions associated with physical operations. Organizations with fleets can take immediate action to reduce their emissions, particularly Scope 1 emissions, using innovative technology to track, manage, and report on fuel and energy consumption. Reporting on Scope emissions not only helps inform an organization’s decarbonization strategy but also promotes transparency and accountability.

Climate action begins with emissions reporting.

The Greenhouse Gas Protocol provides standardized methods for measuring GHG emissions—specifically, the GHG Protocol Corporate Standard is the global framework for organizations to measure and manage their emissions. It provides guidelines for conducting a comprehensive greenhouse gas inventory, categorizing emissions into different scopes, and reporting emissions data in a transparent and consistent way. Today, many organizations use this standard to ensure accurate reporting and to align sustainability efforts with global best practices and climate disclosure requirements. In fact, as of 2016, 92% of Fortune 500 companies responding to the CDP used the GHG Protocol. Additionally, the EPA offers a Corporate Climate Leadership hub with resources, including the GHG Protocol, for identifying, measuring, and reporting on Scope 1, 2, and 3 emissions related to business activities. 

In addition to the GHG protocol, many businesses also align with science-based targets, set by the Paris Climate Agreement and the latest climate science, to inform their sustainability goals—one common climate goal among large organizations is to achieve net zero emissions by 2050 or earlier. 

What are Scope 1 emissions?

Scope 1 emissions are direct emissions from sources that a company owns or controls, such as emissions from using vehicle fuel, onsite industrial processes, fugitive emissions (such as from equipment leaks), use of boilers and furnaces, and refrigeration and air conditioning systems. Creating a GHG inventory with efficient carbon accounting helps organizations keep track of their emissions sources—reducing greenhouse gas emissions and maximizing energy use.

Reducing Scope 1 emissions: Telematics can play a useful role in reducing Scope 1 emissions for fleets. Telematics systems use GPS, sensors, and data analytics to monitor and manage vehicle performance in real time to help organizations lower their Scope 1 impact. 

Below are five ways organizations can understand their own operations’ emissions and can take action today to reduce their Scope 1 emissions with telematics:

• Fuel management: Evaluate the fuel and energy efficiency of your vehicles to identify and reduce usage, consumption, and emissions.

• Driver efficiency: Use telematics data to coach drivers on fuel-efficient habits to reduce vehicle emissions caused by speeding and idling.

• Route optimization: Analyze your route history to identify and deploy more efficient routes to reduce fuel consumption and related emissions.

• Fleet electrification: Accelerate EV adoption and retire your high-emission output vehicles using vehicle efficiency data.

• Vehicle maintenance: Inform your preventative maintenance program with over-the-air vehicle diagnostics to not only reduce vehicle downtime but mitigate fuel waste.

What are Scope 2 emissions?

Scope 2 emissions are a category of indirect emissions associated with purchased electricity, heat, or steam that an organization consumes from external sources, such as a utility company. Reducing Scope 2 emissions and optimizing energy-related activities not only contributes to environmental sustainability but also aligns with corporate responsibility and may lead to cost savings as energy efficiency improves.

Reducing Scope 2 emissions: Reducing these emissions involves transitioning to cleaner and more sustainable sources of energy. Here are five strategies to reduce Scope 2 emissions:

• Renewable energy procurement: Organizations can purchase renewable energy certificates or enter into power purchase agreements with renewable energy providers to source a greater portion of their electricity from sources like wind or solar.

• Energy efficiency: Improving energy efficiency can reduce overall energy consumption to decrease Scope 2 emissions. This can include retrofitting buildings, upgrading equipment, streamlining waste disposal, and implementing energy-saving technologies.

• Combined heat and power (CHP) systems: CHP systems, also known as cogeneration, generate electricity and useful heat simultaneously, increasing energy efficiency and reducing emissions.

• Demand response programs: Participating in demand response programs allows organizations to adjust their electricity usage during peak demand times, reducing the need for fossil fuel-based power generation.

• Energy storage: Implement energy storage solutions to store excess renewable energy for later use, improving energy reliability and reducing reliance on fossil-fuel-based backup power.

What are Scope 3 emissions?

Scope 3 emissions, also known as value chain emissions, represent a broad category of indirect GHG emissions that extend beyond an organization's direct operations, such as those related to goods and services of the supply chain, production of capital goods, business travel, employee commuting, and more. 

Within Scope 3 emissions, there are two main categories: 

• Upstream emissions: These occur during the production and transportation of raw materials and components that are used in a company's products. For example, emissions from mining, agriculture, or manufacturing of parts for products fall into this category.

• Downstream emissions: These occur when a company's products or services are used by customers or end users. For example, the energy consumption of appliances or the emissions associated with the disposal of products contribute to downstream emissions.

Reducing Scope 3 emissions: Tracking and reporting on Scope 3 emissions is a complex process for organizations, often requiring high levels of transparency and coordination with third-party suppliers. Here are three tactics to reducing your organization’s Scope 3 emissions:

• The lifecycle approach: Organizations can use the lifecycle approach to assess and improve the environmental impact of a product or service throughout its entire life, from raw material extraction to disposal or recycling.

• Sustainability partnerships: Partner with other organizations, industry groups, and stakeholders to collectively reduce emissions across the value chain by adhering to industry-specific sustainability standards.

• Transportation: Consider alternative transportation modes like rail or sea to reduce emissions associated with shipping goods and implement tracking and monitoring systems throughout the supply chain to gain visibility into emissions at each stage of transportation.

The benefits of tracking scope 1, 2, and 3 emissions.

Organizations today are often expected by investors, customers, and employees to report on carbon emissions. Beyond meeting expectations, organizations experience many benefits from emissions reporting including:

• Proactive action: Taking a proactive approach to tracking, reporting on, and reducing emissions helps your organization be prepared for upcoming climate regulatory mandates.

• Risk reduction: Understanding your organization’s emissions-related risks, such as supply chain disruptions due to climate events, can help boost your overall business resilience.

• Cost savings: Many strategies to reduce your carbon footprint inherently reduce costs. For example, electrifying your fleet results in less purchased fuel or switching to energy-efficient equipment leads to less electricity consumed.

• Customer trust and brand reputation: Sustainable practices don’t just help your bottom line but they also build trust with your buyers and foster a positive brand reputation. As much as 74% of buyers prefer to work with and buy from organizations that align with their environmental values.

• Employee engagement: Connecting over shared sustainability values is important to many employees today and contributing to emissions reduction initiatives can lead to increased engagement at work. 

Supporting your emissions reporting with Samsara data. 

When planning for the future and reporting on your current state, Samsara data is one tool to help you see and understand your organization’s emissions performance. Samsara offers reporting, alerting, and integrations to help you track your vehicles’ fuel and energy costs, support Scope 1 emissions reporting, and reduce emissions via more efficient fuel and energy management and fleet electrification. 

Learn how Samsara supports your sustainability journey and emissions reporting →