Scope 4: definition

Scope 4 emissions don’t refer to emissions produced like scope 1, scope 2, and scope 3 emissions do. Scope 4 emissions refer to the “avoided emissions”, or the emissions that a company has not produced. 

Often referred to as avoided emissions, Scope 4 emissions are a departure from Scope 1, Scope 2, and Scope 3 emissions as in they do not measure greenhouse gases produced – but rather the emissions that an organization has avoided by offering products, services, or processes that reduce emissions compared to a baseline scenario.

Although Scope 4 emissions are not a part of the Greenhouse Gas Protocol’s current framework, they are becoming more common in corporate sustainability reporting for organizations to highlight their climate-positive contributions. Overall, Scope 4 emissions focus on how a company’s actions help avoid emissions elsewhere in the world beyond their own value chain.

Examples of Scope 4 emissions (avoided emissions):

• A solar panel manufacturer who avoids emissions by using renewable energy in place of fossil-fuel-generated electricity.
• A company producing energy-efficient appliances is helping to potentially reduce the consumption of electricity in large households, which are often prone to producing high levels of emissions. 
• A teleconferencing software provider which is indirectly eschewing the need for business travel and transportation-related emissions. 
• A building materials company developing a low-carbon cement, which would help to avoid emissions in construction projects compared to when using traditional cement.
  

Scope 4 emissions are important, seeing as it could enable companies to demonstrate a profound commitment to fighting climate change and encourage other organizations to support the transition to a low-carbon economy.

However, because Scope 4 is not yet standardized, companies must ensure that claims of avoided emissions are credible, thoroughly calculated, and based on realistic comparison scenarios – otherwise, it could result in greenwashing. 

FAQ

How is Scope 4 different from carbon offsets?

Scope 4 is different from carbon offsets as they refer to the emissions avoided through the use of a company’s products or services as opposed to the specific purchased credits used to offset emissions.

Is Scope 4 officially recognized in GHG Protocol reporting?

No, Scope 4 emissions are not officially recognized by the GHG Protocol – but they are becoming more prominent in voluntary sustainability reports and frameworks.

How are avoided emissions calculated?

Avoided emissions are calculated by comparing the emissions from a baseline scenario with the emissions from the improved product or service. Think of comparing the calories from a sandwich made with less fatty ingredients to a sandwich loaded with mayonnaise, and calculating the caloric differences between the two meals. 

Can Scope 4 replace Scope 1–3 reporting?

No, companies should always first seek to measure and reduce their own direct and indirect emissions before claiming avoided emissions.

Why is Scope 4 controversial?

Scope 4 emissions are considered controversial since it lacks the same standardized framework as Scope 1, Scope 2, and Scope 3 emissions – meaning Scope 4 emissions could lead to accusations of greenwashing if not supported by transparent data.