Why Scope 1, 2 and 3 Carbon Emissions Matter

How EMO Trans Can Make the Customs Process Easier


Scopes 1, 2 and 3 are carbon emission categories that help businesses assess and mitigate their greenhouse gas (GHG) production. Categorizing carbon emissions allows businesses to set actionable sustainability goals.

Impact of Global Greenhouse Gas Emissions

GHGs trap heat in the atmosphere, which is essential to maintaining a stable climate. However, GHGs are harmful when present in excess. Carbon is one example of excess GHGs causing problems.

Global carbon emissions have risen about 90% since the 1970s. The increase in emissions coincides with rising global temperatures. The Earth’s temperature has risen 0.32-0.55 degrees Fahrenheit each decade since 1979.

Consequences of Warming Temperatures

Continued global warming will have drastic consequences for the planet, including:

  • Abrupt changes in weather patterns
  • Increased natural disasters
  • Reduced access to food and water
  • Impact on impoverished people groups
  • Disruption of Earth’s seasonal cycles

What Are Scope 1, 2 and 3 Carbon Emissions?

Global leaders agree that limiting the worldwide temperature increase to 1.5 degrees Celsius or 2.7 degrees Fahrenheit can mitigate the harm of warming trends. Consequently, many nations have united to determine sources of excess GHG emissions and work to reduce them.

About 78% of the global GHG emission increase from 1970 to 2011 resulted from fossil fuel combustion and industrial processes. In 2020, 24% of all gas emissions came from industry.

Key contributors to global GHG emissions must recognize and take responsibility for their carbon production. The Greenhouse Gas Protocol (GHGP) categorizes carbon emissions by a company’s responsibility for them:

  • Scope 1: Emissions from sources a company owns or directly controls
  • Scope 2: Emissions a company causes by purchasing and using energy from another company
  • Scope 3: Emissions a company’s activities cause indirectly up and down the value chain

Who Came up With Scopes for Carbon Emissions?

Recognizing the prevalence of industrial fossil fuel combustion, the World Resources Institute and the World Business Council for Sustainable Development partnered to form the Greenhouse Gas Protocol in 2001. The GHGP maintains that their method of categorizing carbon emissions helps businesses monitor output and determine reduction opportunities.

Examples of Scope 1, 2 and 3 Carbon Emissions

Consider the following examples to understand the distinctions between Scopes 1, 2 and 3:

  • Scope 1: Direct emissions from a company’s vehicles or facility
  • Scope 2: Upstream emissions, including energy, steam and electricity a company purchases
  • Scope 3: Upstream and downstream emissions, including emissions from employee commutes, leased assets, good transportation, the use of products a company sells, goods and services the company buys, waste management and more

Which Scope Should a Company Focus on Reducing First?

Companies should focus on reducing Scope 1 and 2 emissions first, as they are the easiest for a company to monitor and control. The Environmental Protection Agency (EPA) provides numerous resources for companies attempting to measure and report emissions.

Categories of Scope 3 Emissions

The companies most committed to reducing carbon emissions monitor Scope 3 emissions and enact reduction strategies. Scope 3 emissions fall under numerous categories, including:

  • Capital goods
  • Transportation
  • Operational waste
  • End-of-life processes
  • Employee travel
  • Sold products
  • Leased assets
  • Investments
  • Franchises

How Important Are Scope 3 Emissions?

Targeting Scope 3 emissions may be the most effective way for a business to contribute toward global GHG reduction efforts. The Carbon Disclosure Project (CDP) finds that an average of 75% of a company’s emissions fall under the Scope 3 category. The figure is higher for some industries — nearly 100% of financial service emissions are Scope 3.

However, others produce fewer Scope 3 emissions. Scope 3 accounts for about a third of transportation service emissions and 16% of steel industry emissions. Monitoring all three categories helps companies determine which to target.

How to Measure Scope 3 Emissions

Scope 3 emissions come from various sources outside a company’s direct control. However, monitoring a company’s Scope 3 emissions is still feasible by following a few steps.

  1. Identify the Scope 3 categories that apply to the business.
  2. Utilize resources such as the Scope 3 Evaluator ToolScope 3 Calculation Guidance and Scope 3 Investment Category Guidance to develop a strategy.
  3. Continue monitoring and projecting Scope 3 emissions over time. Recording and applying actionable Scope 3 emissions data takes time, so reducing these emissions represents a long-term goal.

Next Steps?

Each company plays a unique role in global GHG reduction efforts, and the ideal strategy varies with each situation. Determining the optimal strategy for any organization starts with thorough research and ends with establishing a protocol for measuring and reporting emissions data.

At EMO Trans, we pledge to reduce Scope 1 and 2 emissions by 40% and Scope 3 emissions by 20% by 2030. We invite you to learn more about our commitment to sustainability today!