Companies can’t pretend that scope 3 is out of their control, says Dr Torill Bigg, Chief Carbon Reduction Engineer at Tunley Engineering.
A company’s scope 3 greenhouse gas emissions are sometimes misunderstood as simply being the scope 1 and 2 emissions from its suppliers.
This would merely be the carbon equivalent of fuel and energy use and could be considered to represent a double counting of carbon emissions. Sometimes, this reasoning is used to justify not measuring or reporting an organisation’s scope 3 emissions.
It has also sometimes been stated that if all companies report their scopes 1 and 2, there would be no need to report the ‘other indirect emissions’ that make up scope 3. However, there are 15 different emission sources included in scope 3, as defined by the greenhouse gas protocol corporate reporting standard. They can be the largest part of an organisation’s carbon footprint by far, and not all of them can justly be laid at the foot of the supply chain.
Let’s take a step back:
Scope 1 emissions are direct emissions from sources such as stationary combustion; for example furnaces, ovens and central heating plus direct mobile combustion such as in company cars or delivery vans.
Scope 2 emissions are indirect emissions from purchased energy sources, most commonly electricity bought in to operate lighting, IT, and machinery.
Although scope 3 will include suppliers’ scope 1 and 2 emissions, it also includes items that are very much emissions from the reporting organisation.
Some scope 3 emission sources can be a little harder to collate data for, but they make a sizeable contribution to a company’s greenhouse gas. Environmental responsibility demands sufficient commitment to their measurement, visibility and opportunities for reduction.
Let’s examine these scope 3 emission sources and consider if there is a legitimate reason for their omission:
Business travel. For example, if an employee travels to a business meeting in their own car and then re-claims that in expenses, these are scope 3 emissions. Organisations could reduce these emissions by incentivising more remote meetings, encouraging greener travel through bicycle purchase schemes, rail travel season ticket loans, and incentives for employees to buy electric cars for private transport.
Transmission and distribution emissions from the purchase of electricity. While the electricity bought in is part of scope 2, the transmission and distribution losses belong in scope 3. Not reporting scope 3 emissions means that this element of electricity used in the running of the business is not reported.
Water use and treatment. There are plenty of options to reduce supplied water use. These include harvesting of rainwater, water re-use in a grey water system, maintenance and prevention of leaks and losses, and fitting water reduction gadgets to wash basins and toilet cisterns. Reducing the quantity of supplied water saves money, conserves an essential resource, reduces wastewater treatment and your greenhouse gas emissions – and belongs in scope 3.
Waste disposal. How a company disposes of its waste materials is included in scope 3. You can choose to dispose of refuse by landfill, or separate out waste for recycling. By playing an active part in reducing waste materials, the amount disposed of is less.
Investments. Money is a powerful enabler. An organisation has the opportunity to select investments that are environmentally responsible. This can be one of the greatest tools in the fight against climate change. Move the money, move the power. Investments are part of your scope 3 emissions.
Freight and transport. When transporting out goods or mail packages, an organisation can select how they are freighted. You can select the type of transport with the lowest carbon emissions for the purpose. For example, larger cargo ships have a smaller carbon footprint per tonne of goods conveyed, and transport by train has a lower carbon footprint than transport by HGV. Changes can ensure optimal use of freighted loads, and packing can consider reusability of the packaging materials or structures themselves.
All in all, organisations have control over, and choices in, a very large element of their scope 3 emissions. It’s not acceptable to plead that scope 3 is out of their control and is effectively in the gift of their supplier chains.
Moreover, a corporation committed to environmental responsibility can work with its wider value chain to facilitate visibility and understanding of the scope 3 emissions that do include supplier emissions.
A larger organisation can empower its supply chain with either a carrot or a stick approach. It can work with the supply chain collaboratively, providing support, information or active technical support to develop greenhouse gas inventories and carbon reduction plans. Or a carbon reduction plan could be required in order to be included as a supplier, or preferred supplier.
Ultimately, we’re all in this together. We only have the one planet and all of us will be adversely affected by climate change. It makes both business and moral sense to be on your suppliers’ side and provide them with a collaborative framework through which everyone can collectively arrive at a low carbon economy.
Dr Bigg, PhD, is a Chartered Member of the Institution of Chemical Engineers.