Indirect Emissions

August 20, 2024Ashish Rohil

Indirect emissions are those emissions of greenhouse gases which are caused by business activities but are produced by other parties over whom the business has no direct control. These emissions are normally addressed as Scope 2 and Scope 3 in the GHG Protocol and are critical in comprehending an organization’s or product’s life cycle emissions.

Understanding Indirect Emissions

The reason for its importance is that the indirect emissions reflect the overall emissions related to an organization’s activities, they do not include only the direct emissions (Scope 1). These emissions often occur upstream or downstream in the value chain and can include a variety of sources:

Scope 2 Emissions: Indirect greenhouse gas emissions which includes emissions from the purchase of electricity, steam, heating or cooling. These emissions are produced at the place where energy is generated but are reported by the company that purchases the energy.
Scope 3 Emissions: Any other emissions that result from indirect activities included in the value chain such as acquired goods & services, transportation & distribution, business travel, employee commute, waste management, and product disposal.

Examples of Indirect Emissions

Electricity Consumption: Fumes emitted from a power generating plant that supplies electricity to the firm’s offices or facilities where goods are produced.
Supply Chain Activities: Emissions that occur in the extraction of raw materials, production, and transport of goods and services acquired by the organization.
Employee Commuting: Vehicle exhaust from employees’ transport to and from their workplace, who are not directly within the organization’s control but are brought about by the organization’s activities.

Importance of Measuring Indirect Emissions

Mitigating indirect emissions is critical in organizations’ efforts to minimize their overall emissions and bring about sustainable solutions. This full picture of emissions enables organizations to look for ways they can cut emissions as well as work effectively with suppliers to prompt wider change for the environment.

FAQs about Indirect Emissions

1. What is the difference between direct and indirect emissions?

Scope 1 emissions are a result of sources owned or controlled by the company while scope 2 and scope 3 emissions are as a result of the organization’s activities but are produced by sources outside the company.

2. Why are indirect emissions important in carbon accounting?

These emissions are crucial since they may form the largest proportion of the overall emissions of an organization. With these emissions estimated, organizations can have a broader view of the issue and thus look for change.