History of Scope 1, 2, and 3 Emissions

Reporting a company’s carbon footprint might seem like a concept from this decade, but carbon accounting dates back to 2001, when the first Corporate Standard for carbon footprint reporting was published by the Greenhouse Gas Protocol. Following this, the US EPA published a rule in 2008 requiring the public reporting of emissions from large sources.

Between 2008 and 2018, the US government tried various clean energy strategies relating to carbon emissions, including the development–and later abandonment–of a cap-and-trade policy to address emissions from the power sector. Over the following years, policies at the national and state levels evolved, but the underlying methodology from the GHG Protocol became the backbone for emissions reporting around the world. 

Scope 1 and 2

Many early emissions reports cover only Scope 1 and 2. This is because the GHG Protocol’s Corporate Standard for Emissions Reporting covers Scope 1 and 2 emissions separately from Scope 3. 

Scope 1 is considered to be all greenhouse gas (GHG) emissions from fuels directly purchased by the company, such as those used for vehicles and on-site power generation. This category also includes fugitive emissions and any greenhouse gases purchased for industrial use, like refrigeration or on-site chemical processing. Since this data is often already tracked for cost and material efficiency, it can also be leveraged for emissions tracking. Similarly, Scope 2 emissions cover indirect GHG emissions from purchased electricity and steam, with data readily available from energy bills or related reports.

Once the correct inputs for a company are identified, Scope 1 and 2 emissions can be calculated by a solution like EcoImpact, which uses up-to-date information approved by the GHG Protocol. Companies often disclose their Scope 1 and 2 emissions because of the relative ease of their calculations and the competitive advantages of transparency. However, Scope 3 emissions are often overlooked due to their complexity. 

Scope 3

A company’s Scope 3 emissions include all indirect emissions beyond Scope 1 and 2, making them the broadest and most complex category. With the introduction of the European Union’s Corporate Sustainability Reporting Directive (CSRD), companies will now be required to track and report Scope 3 emissions with the same level of detail as Scope 1 and 2.

Complexity is but one challenge facing those reporting their Scope 3 emissions; another is interconnectivity. Scope 3 categories like Upstream/Downstream Leased Assets, Employee Commuting, and Emissions from Data Centers require the collection of high quality emissions data from multiple sources, some of them individual citizens. At first glance, it seems borderline impossible to calculate Scope 3 reliably.

With this in mind, it’s important to take a long-term, holistic approach to reporting. While a company’s first report may not capture every detail, it can still be accurate and serve as a starting point for refining data collection over time. By leveraging a structured Scope 3 reporting process with Trayak, businesses can continuously improve their data quality and analysis. A centralized sustainability platform enables companies to collaborate across complex supply chains, enhancing emissions models and reducing carbon footprint industry-wide.

Carbon Accounting

Trayak’s EcoImpact Sustainability Platform provides a structured approach to data ingestion and analysis for Scope 1 and 2 emissions data. Additionally, our Scope 3 consulting service guides accurate data collection and calculation. Partner with us to define your scope reporting process year over year, turning compliance challenges into strategic advantages for your sustainability goals.

Purchase Trayak’s Scope 1 and 2 solution, click here.

Contact us for more information on Scope 3 services.