What are Scope 4 emissions?

What are Scope 4 emissions?
Friday 9 December 2022, 10:47 AM

3 Minute Read

You may be familiar with Scope 1, 2 and 3 emissions, but what about Scope 4? In order to understand its importance, let’s look at the three official scopes classed under the Greenhouse Gas (GHG) protocol.

Scopes 1, 2 & 3

The GHG protocol was introduced by the World Resources Institute in 2001, as an international standard for categorising corporate greenhouse gas emissions based on their source. The GHG protocol provides a framework for companies to identify and measure their carbon impact.

Three scopes are categorised under the protocol:

  • Scope 1 – covers emissions released into the atmosphere as a direct result of an activity, such as gas for heating an office or fuel for operating a vehicle
  • Scope 2 – covers emissions created from producing the energy that a company uses, in other words, the energy that a business purchases
  • Scope 3 – covers indirect emissions such as transportation and distribution, waste generated, leased assets, business travel, employee commuting, purchased goods and services through your supply chain and also water consumption

Scope 4 emissions

In 2013, the GHG protocol was updated to incorporate estimating and reporting of avoided emissions. These were coined ‘Scope 4’ emissions by the World Resources Institute.

Whilst not classed as an official scope under the GHG protocol and based on theoretical calculations, Scope 4 emissions refer to the estimated greenhouse gas emissions that have been avoided, due to the use of more efficient goods and services. The GHG protocol states that these avoided emissions occur outside of a product/service lifecycle or value chain, so they are not captured within Scopes 1, 2 and 3.

There are two main types:

  1. Product/service replaces a more emission-intensive product e.g. a company that provides tele-conferencing services, reducing the emissions that would have been generated by travelling
  2. Product/service enables emissions reductions elsewhere e.g. a manufacturing company that creates a low-temperature detergent

Scope 4 also covers homeworking emissions because they have avoided using transport with fuel and energy use in a much bigger work environment.

Why measure Scope 4 emissions?

It has become standard practice for businesses to measure Scope 1 and 2. Although not mandatory, including Scope 4 in carbon accounting can help businesses become more aware of their environmental impact and the steps required to reduce it.

However, as there is no standardised method of calculating Scope 4 emissions, this could lead to ‘greenwashing,’ where businesses make unsubstantiated claims – intentional or not – about their environmental action.

The GHG protocol suggests that businesses can avoid greenwashing by:

  • Accounting for every stage of the product’s life cycle
  • Considering changes in consumer behaviour
  • Segregating market size with impact

How we can help

If you are interested in measuring the environmental impact of your business, we can provide our clients with access to our client portal, CECIL, which enables you to identify and manage your business energy usage. You can also download our free green energy eBook for more information on green energy.

Feel free to get in touch with us for advice or an opinion on the best options for your business.

Control Energy Costs is a proud member of the FactoryNOW initiative

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