If you’re committed to reducing your carbon footprint, understanding and managing emissions is one of the first actions. Scope 1 and 2 emissions are easy to measure and control. Scope 3 is a whole different story. Scope 3 includes all indirect emissions throughout the value chain, from upstream activities like raw material production to downstream activities like product use and disposal. These are the biggest part of your total carbon footprint and the hardest to manage.
What are the Scopes for Emissions and Why is Scope 3 Important ?
The Greenhouse Gas (GHG) Protocol defines emissions into three scopes:
- Scope 1 (Direct Emissions): Emissions from sources owned or controlled by the business, like fuel combustion in company vehicles or boilers.
- Scope 2 (Indirect Emissions from Energy): Emissions from the energy used by the business, like electricity and heating.
- Scope 3 (Other Indirect Emissions): Emissions that result from the company’s activities but occur from sources not owned or controlled by the company. Examples include emissions from suppliers, product transport, business travel, waste disposal, and consumers’ use of the company’s products.
Scope 3 is the most significant part of many businesses’ carbon footprint accounting for more than 70% of their carbon footprint. For example, in the commercial property sector, these can include emissions from construction materials, tenant energy usage and waste management. Tackling Scope 3 is critical because it gives a complete picture of the company’s environmental impact and allows for more effective emissions reduction strategies.
The Complexity of Managing Scope 3 Emissions
Scope 1 and 2 are more straightforward to measure because they directly affect the business’s activities. Scope 3 emissions spread across the whole value chain, which makes them hard for several reasons:
- Collecting data for Scope 3 emissions often requires data from third-party suppliers, contractors, and customers, which can be inconsistent or incomplete.
- The business has limited control since these emissions are from external sources, so reduction is more complex.
- Scope 3 emissions cover a broad range of activities from raw material extraction to end-of-life product disposal, so standardising measurement and reduction practices take a lot of work.
Example: For a commercial landlord Scope 3 emissions might include emissions from the production of construction materials used in building projects, energy used by tenants and waste generated by property operations. Each of these elements requires a different approach to measurement and management.
Why Collaboration is a Must
Given the complexity of Scope 3 emissions, businesses should collaborate to manage them rather than it being a client mandate. Working closely with supplier you can:
- Engage suppliers in conversations about their sustainability practices and encourage them to use energy-efficient production methods.
- Develop a standard methodology for suppliers to report their emissions so you can aggregate the data and identify where to reduce them.
- Foster a better relationship by developing joint initiatives to reduce carbon.
Tenant energy usage is also big part of Scope 3 emissions. Working with tenants to reduce their energy usage can deliver significant reductions. Property owners can encourage tenants to adopt energy-efficient practices such as installing energy-efficient lighting or smart energy management systems. They can also implement ‘green lease’ agreements where tenants agree to specific sustainability measures, creating a partnership that benefits both parties by reducing utility costs and carbon emissions.
Industry-Wide Collaboration is essential too. By joining sustainability initiatives and alliances, businesses can share best practices, set industry standards and drive collective progress. When multiple companies work together to pressure suppliers to reduce emissions or adopt cleaner practices, the impact is greater than one company could achieve alone.
Organisations can also join groups like the UK Green Building Council (UKGBC) or the Green Property Alliance to learn from others and contribute to industry-wide goals.
How to Manage Scope 3 Emissions
Managing Scope 3 emissions requires a strategic and structured approach. Here’s how you can get started:
1. Map the Value Chain
Identify all the potential sources of Scope 3 emissions across your business’s value chain. This may include looking at upstream (suppliers, transport) and downstream (product use, waste disposal) activities. The more comprehensive your map, the easier it is to focus on the high-impact areas.
2. Data Collection Strategy
Since Scope 3 data comes from third parties, having a transparent, standardised process for data collection is critical. Use tools and software that can automate data gathering and analysis.
3. Set Science Based Targets
Set realistic science-based targets for reducing Scope 3 emissions. The Science Based Targets Initiative has a framework for setting such targets so businesses can be sure their targets align with global climate goals.
4. Continuously Measure and Improve
Managing Scope 3 emissions is not a one-off project but an ongoing process. Review and update data regularly, assess the effectiveness of initiatives and adapt as needed. Engage with partners, suppliers and customers to stay on track.
Scope 3 emissions are significant and challenging and managing these emissions requires collaboration across the whole value chain, from suppliers and customers to industry peers. Property holders can make considerable progress in environmental impact by having a structured and transparent approach and setting clear targets.
Ready to tackle your Scope 3 emissions? Contact Lynx Energy and Carbon Assessors today to get started.
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