By the end of this century, countries and companies must limit global warming to around 1.5°C (2.7°F) in order to avoid the worst effects of climate change. This finish line may seem distant, but the reality is achieving this goal requires greenhouse gas (GHG) emissions to peak before 2025, and then be reduced by 43% by 2030.
How do we go about reducing GHG emissions? Actively managing our climate starts with actively measuring current emissions and developing a detailed understanding of which activities cause them. To ensure complete and consistent accounting, the GHG Protocol Corporate Standard breaks down emissions into three categories — Scope 1, 2, and 3.
Source: U.S. EPA
Today, we’re focusing on understanding Scope 3 emissions, as well as the reduction strategies available to companies. If you’re looking to explore more about Scope 1 emissions you can do so here and you can dive deeper into Scope 2 emissions here.
What Are Scope 3 Emissions?
For many companies, Scope 3 emissions make up the largest share of overall emissions—typically 80–90%. That makes understanding this category critical to any meaningful climate strategy.
Scope 3 emissions are a business’s indirectly generated emissions: business travel, employees’ daily commutes, waste, purchased goods and materials, end-of-life disposal of products the company makes, transportation, marketing, and more. These emissions occur along the entire value chain, including “upstream” activities and “downstream” activities.
Take, for example, a brand of granola bars. Its Scope 3 emissions come from an array of upstream activities — those that happen before it bakes and packages its granola bar products — including the fertilizer used to grow the grain, the transportation of the grain to its facility, and the polypropylene plastic and aluminum material used to package the granola bars. Downstream activities — those that happen after the granola bars leave the company’s facilities — are also an important part of Scope 3 emissions. These include the transportation needed to get the granola bars from the company’s facility to grocery stores, the energy used by the supermarket, the gasoline used by shoppers on their way to and from the store to make a purchase, and the impact of the wrapper after it is discarded by the customer.
Given all that, you can see why calculating all of a company’s Scope 3 emissions is challenging — many of these activities are out of a company’s immediate control.
Reducing Scope 3 Emissions
Reducing upstream Scope 3 emissions depends in large part on successful partnership engagement. How can a company switch to more sustainable supply partners in order to reduce emissions? Some areas to consider include:
- Finding more sustainable suppliers for purchased goods and raw materials
- Working with current suppliers to reduce the environmental impact of their operations
- Choosing transportation partners with more sustainable and efficient logistics
- Encouraging virtual meetings to cut back on business travel
- Allowing flexible work-from-home or hybrid arrangements to reduce employee commuting
Addressing downstream Scope 3 emissions requires a blend of working with distribution partners, product and packaging changes, and influencing consumer behavior. Opportunities to explore include:
- Selecting distribution partners with more sustainable and efficient transportation options
- Working with distribution locations to encourage a reduction in their energy consumption
- Changing product and packaging design to limit the environmental impact as a customer uses or consumes the product or service
- Educating consumers on the most effective end-of-use disposal and recycling processes
Some of these reduction solutions are more easily implemented than others. When considering how to address emissions from an activity a company has little control over, they have the option to financially support sustainable activities in other industries to offset the impact of their Scope 3 emissions until more environmentally-friendly alternatives are available.
EarnDLT allows companies to do exactly that. Our platform for quantified emissions makes it easy for companies to purchase verified low-emissions data from responsible energy producers. These producers’ processes generate fewer GHG emissions than traditional energy production, creating an opportunity for companies to buy these emissions reductions and count them against their own Scope 3 emissions reductions efforts.
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