What are scope 2 emissions?

Scope 2 emissions are indirect emissions from the generation of purchased energy consumed by your organization. This primarily includes electricity purchased from the grid, but also includes purchased steam, heat, and cooling. 

Location Based Calculation Method: 

The location-based method calculates emissions based on the average energy generation emission factors for the geographic region where your energy consumption occurs. This approach uses grid average emission factors, typically provided by regional electricity authorities or national databases. 

• How it Works: 
  • You multiply your energy consumption by the average emissions intensity of the local or regional grid. For example, if you have facilities located within the United States, you can use the Environmental Protection Agency's (EPA) eGrid averages for the region your facility operates within. 

Market Based Calculation Method: 

The market-based method reflects emissions from the electricity that your organization has purposefully chosen to purchase through contractual instruments. This approach allows companies to account for renewable energy certificates (RECs), power purchasing agreements (PPAs), green tariffs, and other contractural arrangements. 

• How it Works:
  • You multiply your energy consumption by the emissions factor listed within your contractual instruments. For unbundled energy, that's not covered by specific contractual instruments, you should use residual mix emissions factor of the eGrid subregion location that your energy consumption occurs. 

When using the Emissions Management Tool, users are able to choose between calculating using both methods, or just one. Under the “Usage” tab is where Scope 2 emissions will be calculated if companies have not already done so.