Exclusion Methods 

This article explains exclusion methods in the Emissions Management Tool (EMT), outlining available options and providing implementation guidance.

Exclusion methods can be found under the ‘Scope 1’ and ‘Scope 2' tabs of the EMT. A material exclusion refers to any emissions sources within your reporting boundary that were not included in your emissions calculations. Companies may exclude certain Scope 1 or 2 GHG emissions to refine organizational boundaries, because the emissions are immaterial or too justify tracking resources, or due to data availability constraints. While exclusion methods enable accurate reporting, all exclusions should be disclosed and justified following best reporting practices.

Scope 1 Options: 

• Fugitive or minor emission sources
  • Fugitive emissions are pollutants that are not released unintentionally, released through leaks from valves, seals, and similar equipment rather than through controlled release points. Companies may exclude fugitive emissions due to measurement difficulties, data quality issues, or comparability concerns with industry peers. However, best practice encourages reporting all material Scope 1 sources, including fugitive emissions. All exclusions must be documented and justified. 
• Emissions from leased assets or mobile sources not under organizational control 
  • Organizations either report from a financial control boundary or operational control boundary. Under operational control, organizations will exclude assets they do not operate. Emissions from leased assets often fall into Scope 3, Category 8. Organizations reporting leased assets within Scope 3 will exclude these emissions from their Scope 1 inventory. Best practice encourages reporting all material emissions, regardless of scope. All exclusions and boundary decisions must be documented and justified. 
• Emissions from facilities or operations excluded based on materiality from reporting boundary
  • Organizations define inventory boundaries, and may choose to exclude from their inventory based on the emissions sources that are not material to them. Common examples include de minimis thresholds such as small offices or remote work locations representing less than 5% of total emissions, or practical boundaries like excluding employee home office locations. While such exclusions are permitted, all exclusions, scope boundaries and materiality assessments must be documented and justified. For growing companies, previously immaterial sources can become material without triggering reassessment, making regular materiality reviews essential for best practice reporting.  
• Greenhouse gas (GHG) species excluded due to immateriality (e.g. SF6, PFCs) 
  • Following an organizational screening, companies may exclude GHG species such as F6 and PFCs if determined to be immaterial. Screenings must confirm absence or presence given the high global warming potentials of these gases. All exclusions and immateriality determinations must be justified and documented.  
• Biogenic CO2 emissions (reported separately) 
  • Per many reporting standards, biogenic CO2 is reported separately from fossil fuel CO2 and excluded from the main Scope 1 total. Sources for biogenic CO2 emissions include biofuel use, renewable natural gas, wood heating, and waste combustion. These are reported separately due to their closed-loop biogenic carbon cycle and the different climate impacts had compared to fossil fuels. While reported separately, biogenic emissions still have climate impacts and must be quantified and disclosed.
• Other (please specify) 
  • Option to enter description (max 30 characters)

Scope 2 Location-Based Options: 

• Electricity use from facilities or sites not yet measured or reported 
  • Organizations may exclude electricity consumption from certain facilities or sites where measurement systems have not yet been implemented or where data collection processes are still being established. This typically applies to newly acquired properties, facilities undergoing integration, or locations where metering infrastructure is still being installed. All exclusions must be documented and justified and organizations are encouraged to include these sites in future reporting cycles. 
• Temporary or remote operations excluded due to data unavailability 
  • Organizations may exclude emissions from temporary facilities, projects sites, or remote operation where obtaining reliable electricity consumption data is not feasible. Examples include shot-term construction sites, pop-up locations, or remote field operations where utility data access may be limited. While such exclusions are permitted when data collection is impractical, organizations should document these exclusions and assess whether the emissions from such operations meet materiality thresholds. 
• Emissions from leased assets not included in organization boundary 
  • Organizations may exclude emissions from leased facilities that fall outside their defined organizational boundary. Under certain consolidation methods, leased assets where the organization lacks operation or financial control may excluded from Scope 2 and reported in Scope 3, Category 8. All boundary decisions and exclusions must be clearly documented and applied consistently. 
• Emissions excluded based on materiality threshold 
  • Organizations may exclude electricity consumption from facilities or operations that fall below established materiality thresholds. While materiality-based exclusions are permitted, organizations must document their materiality assessment, reassess thresholds annually as operations evolve, and ensure excluded sources remain genuinely immaterial. 
• Grid electricity use estimates using proxies or notes reported
  • Organizations may note when grid electricity consumption is estimated using proxy data or assumptions rather than actual metered readings. While estimates are acceptable when actual data is unavailable, organizations should disclose of proxy methods and work towards obtaining actual consumption data to improve their accuracy. 
• Non-electricity energy use (eg steam, chilled water) not included
  • Organizations can choose to exclude purchased steam, heating, cooling, or chilled water from their Scope 2 inventory. Although the GHG Protocol includes these energy sources in Scope 2, some organizations may exclude them due to measurement challenges, data unavailability or minimal materiality.  
• Other (please specify) 
  • Option to enter description (max 30 characters) 

Scope 2 Market-Based Options:

• Sites without contractual instruments (e.g. RECs, GOs, PPAs) reported using market-based method 
  • Organizations using the market-based method may report certain sites using a residual mix emissions factor when contractual instruments are not in place. Under the market-based method, locations without specific contractual instruments default to residual mix factors that reflect the grid's remaining emissions after accounting for contractual claims. Organizations should document which site use residual mix factors.
• Incomplete or missing supplier-specific emission factors 
  • Organizations may face situations where supplier-specific emission factors are incomplete, unavailable, or not provided by electricity suppliers. In such cases, organizations may need to use alternative emission factors such as residual mix or regional averages for the market-based calculation. While supplier-specific factors are preferred for accuracy, their absence may necessitate the use of proxy data. Organizations should document instances where supplier-specific factors are unavailable and efforts to obtain them.
• Leased or third-party operated facilities excluded 
  • Organizations may exclude emissions from leased facilities or third-party operated sites that fall outside their defined organizational boundary under the market-based method. This typically occurs when the organization lacks control over energy procurement decisions or when contractual arrangements place energy purchasing responsibility with landlords or third-party operators. Such exclusions should align with the organization's consolidation approach and be consistently applied. All boundary decisions must be documented and justified.
• Emissions excluded based on materiality threshold 
  • Organizations may exclude electricity consumption from facilities that fall below established materiality thresholds in their market-based accounting. Similar to location-based exclusions, this applies to minor operations representing an insignificant portion of total emissions. Organizations must document their materiality assessment methodology and reassess thresholds regularly to ensure excluded sources remain immaterial as the business evolves.
• Renewable energy procurement not tracked or included 
  • Organizations may not yet have systems in place to track and account for renewable energy procurement instruments in their market-based inventory. This can occur when renewable energy purchases are being made but the necessary documentation, tracking systems, or contractual instrument registries have not been established to support market-based reporting. Organizations should document plans to implement proper tracking mechanisms and include renewable energy claims in future reporting cycles.
• Temporary or newly acquired sites excluded due to data gaps
  • Organizations may exclude emissions from temporary facilities or newly acquired sites where market-based data is not yet available. This typically applies during integration periods for acquisitions, mergers, or new operations where contractual instrument data, supplier relationships, or procurement information has not been fully established. While such exclusions are permitted during transition periods, organizations should document timelines for including these sites in future reporting.
• Other (please specify) 
  • Option to enter description (max 30 characters)