Scope 2 Emissions

Scope 2 emissions are defined as indirect greenhouse gas (GHG) emissions from the generation of purchased or acquired electricity, steam, heat, or cooling consumed by the reporting organization. They are one of three "scopes" established by the GHG Protocol to help organizations delineate their sources of emissions and manage their carbon footprint.

While the emissions physically occur at the power plant or facility generating the energy, the reporting company is responsible for them because it is the end-user creating the demand. Accurately measuring Scope 2 emissions is a crucial step in corporate sustainability reporting, risk assessment, and identifying opportunities for energy efficiency. This data often influences decisions regarding capital expenditures (CAPEX) for energy-saving equipment and directly impacts utility costs within operating expenses (OPEX).

The calculation can be done using either a location-based method, which reflects the average emissions intensity of the regional grid, or a market-based method, which reflects emissions from the specific energy suppliers a company has chosen. This information is a key metric used in both internal management reporting and external stakeholder communications.