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The Definition of Scope 2 Emissions

Scope 2 emissions are indirect greenhouse gas emissions from generating the electricity, steam, heat or cooling a company buys and uses.

Plain-English definition
Real-world example
Scope 2 Emissions definition

Definition of Scope 2 Emissions

Scope 2 emissions are indirect greenhouse gas emissions from the generation of purchased electricity, steam, heat or cooling that a company consumes. The emissions physically happen at the power plant, but they are counted by the company because its demand causes them.

Location-Based and Market-Based Methods

The GHG Protocol asks companies to report Scope 2 in two ways:

  • Location-based: uses the average emissions intensity of the grid where the electricity is used.
  • Market-based: reflects the electricity a company has chosen to buy, including green tariffs, power purchase agreements and renewable energy certificates.

The GHG Protocol has been revising its Scope 2 guidance, including proposals for tighter matching of clean energy purchases to the time and place electricity is used. Companies should watch for final changes before planning long-term energy purchases.

Reducing Scope 2 Emissions

  • Improve energy efficiency in lighting, compressed air, HVAC and motors.
  • Install on-site solar or other renewable generation.
  • Buy renewable electricity through contracts or certified tariffs.

Example of Scope 2 Emissions

A manufacturer with three plants collects monthly electricity bills for each site. Its location-based Scope 2 total uses each region's grid factor. Because one plant buys certified renewable electricity, its market-based total is noticeably lower.

Frequently Asked Questions: Scope 2 Emissions

Why report two Scope 2 numbers?

The location-based figure shows the real impact of the grid you draw from, while the market-based figure shows the effect of your purchasing choices.

Does electricity for electric vehicles count as Scope 2?

Yes, if the company buys the electricity to charge vehicles it owns or controls.

Is fuel burned in a backup generator Scope 2?

No. Fuel you burn yourself is Scope 1.

Part of SafetyIQ's EHS glossary: plain-English definitions of workplace health and safety terms.

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