Understanding a Product Carbon Footprint (PCF)
In this article, we'll explore what a PCF is, its relevance in today's business environment, and the step-by-step process of conducting one.
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You might not have read the Paris Agreement cover to cover, but there's a good chance you've heard about one of its primary goals: keeping the rise in global temperatures below 1.5°C. This figure hasn't been plucked from thin air - it's a crucial benchmark to keep the more extreme effects of climate change at bay.
So, what’s our strategy to achieve this? Well, the key is reducing greenhouse gas emissions (GHGs). And a big part of that comes down to keeping an eye on something called Scope 1, 2, and 3 emissions. These categories aren't just industry jargon, they're key to identifying the sources of emissions and figuring out effective ways to reduce them and prevent global warming. In this article, we'll unravel these terms and explain why they're essential in our collective effort to combat climate change.
In this article, we clarify what Scope 1, 2, and 3 emissions are and their significance in managing a company's carbon footprint.
Why is it important to work out Scope 1, 2, and 3 emissions? Let's start with a quick refresher: the greenhouse effect is a natural process that helps keep the Earth's temperature at a level suitable for human life. But here's the catch – the excessive GHG resulting from human activities is supercharging this effect, leading to a rise in the average global temperature. And the fallout? It's putting the Earth’s ecosystems in a tight spot, threatening the delicate balance that supports life as we know it.
To effectively reduce your carbon emissions, whether as an individual or a company, the first step is understanding how much carbon you're actually emitting. This is where the concept of GHG emissions scopes comes into play. They provide a structured way to categorise and measure these emissions, laying the foundation for targeted strategies to cut down on carbon output.
To learn more about the Earth’s carbon cycle and why it’s out of balance head over to our article on the topic.
To understand Scope 1, 2, and 3 emissions we need to look to the Greenhouse Gas Protocol. This initiative is a comprehensive multi-stakeholder partnership, encompassing businesses, non-governmental organisations (NGOs), governmental bodies, and other entities, all brought together by the World Resources Institute (WRI) in 1998.
Their mission? To develop and establish international standards for accounting and reporting GHG emissions for businesses and to encourage widespread adoption.
To learn more about the GHG protocol head over to our blog.
Developing a full emissions inventory - incorporating Scope 1, Scope 2 and Scope 3 emissions - enables companies to focus their efforts on the greatest reduction opportunities" The Greenhouse Gas Protocol.
The term 'Scope emissions' first made its appearance in the GHG Protocol Corporate Accounting and Reporting Standards. These standards are a go-to resource for companies aiming to measure and report their GHG emissions accurately. They play a crucial role in breaking down a company's emissions into distinct categories, which are more commonly known as 'scopes.' More specifically, Scope 1, Scope 2, and Scope 3 emissions - each category represents a different source of emissions.
Let’s break down these categories:
By understanding and categorising emissions in this way, companies can develop more targeted strategies to reduce their overall carbon footprint.
Let’s explore the different scopes in more detail.
Scope 1 emissions are directly released into the atmosphere as a result of a company's activities. These direct emissions originate from resources that are owned or controlled by the company. To ensure comprehensive tracking and management, Scope 1 emissions are categorised into four distinct groups:
For a more in-depth overview of Scope 1 emissions head over to our dedicated article.
Scope 2 emissions refer to indirect GHG emissions that arise from the consumption of purchased electricity, steam, heat, and cooling in buildings and production processes. These emissions are classified separately because they originate from sources not directly controlled by the company.
The majority of Scope 2 emissions typically stem from electricity consumed by the company. This category encompasses the indirect emissions produced during the generation of the electricity purchased, which is then transmitted and distributed to the company.
For a more detailed exploration of Scope 2 emissions why not check out our article.
Scope 3 emissions represent a significant part of GHG accounting. However, because it involves quantifying carbon emissions associated with a company's supply chain it is often seen as the most challenging to quantify. Unlike Scope 1 and 2 emissions, Scope 3 emissions are not directly linked to the company's own operations, but rather to the entire value chain, incorporating both upstream and downstream emissions. These significant carbon emissions are associated with the company’s operations, yet they occur outside of its direct control.
Scope 3 emissions encompass a wide range of indirect emissions, examples include:
Scope 3 emissions provide a comprehensive view of a company's environmental impact, extending beyond its immediate operations to the broader impacts associated with its value chain emissions.
Unless a company has significant real estate holdings and energy consumption the majority of a company's total emissions, around 70%, typically comes from Scope 3 sources. This statistic underscores the extent to which a company's environmental impact extends beyond its direct activities, into its wider value chain. Addressing these emissions is crucial not only for reducing a company’s carbon footprint but also for identifying cost efficiencies and reinforcing sustainable practices.
Additionally, it's revealing to note that 71% of global emissions can be traced back to just 100 companies. This fact emphasises the enormous responsibility and influence businesses have in tackling global warming. Nowadays, the role of businesses extends beyond mere product and service delivery; they are expected to be at the forefront of environmental responsibility. The growing demand from customers, employees, and investors is for companies to actively incorporate sustainability and environmental considerations into their operations.
Companies that embrace sustainable practices also position themselves for new growth and investment opportunities. Those who ignore this shift risk falling behind, as regulatory environments tighten and consumer expectations lean heavily towards environmental stewardship.
Measuring all emissions, particularly Scope 3, is therefore not just a regulatory formality, it’s a strategic necessity, allowing companies to:
Learn more about Scope 3 emissions.
When we talk about measuring carbon footprints in terms of carbon and carbon dioxide equivalents, we are referring to the quantification of different greenhouse gases (GHGs) in terms of their impact on global warming. This measurement is crucial because different gases have varying levels of effect on the Earth's atmosphere.
The most common unit of measurement is the carbon dioxide equivalent (CO2e), which standardises various GHGs based on their Global Warming Potential (GWP).
Discover more about carbon footprints and their calculation methods.
Would we leave you without offering practical solutions? That's not how we operate at Greenly. We're all about championing sustainable development and backing companies keen on making an environmental difference. Every little bit helps, and no contribution is too small.
Ready to tackle your carbon footprint? Great! But before diving in, it's crucial to assess your GHG emissions rate. Feeling overwhelmed? No need to stress – Greenly has got your back. We offer personalised advice and support, especially with those challenging Scope 3 emissions. Reach out to our team for expert guidance.
Keep readings for tips on how to start your sustainability journey:
At Greenly we can help you to assess your company’s carbon footprint, and then give you the tools you need to cut down on emissions. Why not request a free demo with one of our experts - no obligation or commitment required.
If reading this article has inspired you to consider your company’s own carbon footprint, Greenly can help. Learn more about Greenly’s carbon management platform here.