Scope 2 emissions are greenhouse gas (GHG) emissions indirectly produced by a company’s activities through the generation of purchased electricity, heating, or cooling. These emissions, often referred to as "indirect emissions," result from a third party generating the energy consumed by the company.

The primary types of purchased energy tracked include:

• Electricity

• Steam

• Heat

• Cooling

Companies can identify these energy uses through utility bills or metered energy consumption at their facilities.

Indirect Emissions Associated with Transmission and Distribution (T&D)

Emissions generated from the production of purchased electricity consumed during T&D are reported in Scope 2 by the entity that owns or controls the T&D operation. This approach prevents double counting, ensuring that only the T&D utility company accounts for these indirect emissions in Scope 2.

Scope 2 emissions are a significant component of a company's carbon footprint and can often represent a considerable portion of their overall emissions. Companies can reduce their Scope 2 emissions by purchasing renewable energy or implementing energy efficiency measures. Additionally, they can offset these emissions by investing in projects that generate renewable energy or improve energy efficiency.

Strategies for Reducing Scope 2 Emissions

Reducing Scope 2 emissions is essential for organizations to minimize their overall carbon footprint. Here are several strategies to achieve this goal:

• Energy Efficiency: Implement energy-saving measures within facilities to reduce overall electricity and heating/cooling demand.

• Renewable Energy Procurement: Purchase electricity from renewable sources such as solar, wind, hydro, or biomass, either directly or through renewable energy certificates (RECs).

• On-site Renewable Energy Generation: Install renewable energy systems, such as solar panels or wind turbines, on-site to generate clean energy for the organization's operations.

• Green Building Design: Incorporate sustainable design principles, such as passive heating and cooling, natural lighting, and energy-efficient insulation, in building construction and retrofits.

• Energy Management Systems: Implement energy management systems and software to monitor and optimize energy consumption, identify inefficiencies, and prioritize energy-saving initiatives.

• Equipment Upgrades: Replace energy-intensive equipment, such as lighting, HVAC systems, and appliances, with energy-efficient models.

• Power Factor Correction: Improve the power factor in electrical systems to reduce energy waste and optimize the efficiency of electricity consumption.

• Virtual Power Purchase Agreements (VPPAs): Enter into virtual power purchase agreements with renewable energy projects, enabling organizations to claim the environmental benefits of renewable energy generation without directly sourcing the power.

By adopting these strategies, companies can effectively reduce their Scope 2 emissions and contribute to their overall sustainability goals.

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For more information

To start at the beginning, read the Understanding Carbon Emissions guide, or to move to the general overview of scope 1, 2 and 3.