Posted on 07/01/2016
For an organization to accurately report its greenhouse gas emissions, it must first establish its organizational boundary. This boundary refers to the legal composition of the company and if the company has direct control over the sources of the emissions.
An organizational boundary takes into account whether the operation is part of an umbrella company or a subsidiary, and determines whether the operation is in financial control of the assets or operational control as it refers to the gas emissions.
When an organization has determined its organizational boundary, it must then establish an operational boundary which will define the scope of both direct and indirect emissions within that organizational boundary.
There could be numerous operational levels within an organization and it is up to the directors of the operation to establish operational boundaries for the three emissions scopes. Once the operational boundary has been established, it must be applied uniformly within the enterprise.
Within the operational boundary lies the potential for several different types of emissions scope. These scopes are defined as:
Greenhouse Gas Emissions – Scope One
If the enterprise has direct control over electricity generation or uses fossil fuel within its process, it must report these under scope one. In addition, any kind of vehicle transportation that is directly utilized by the organization (e.g., cars, trucks or trains) must also be reported here. Accidental leaks are a scope one reporting burden.
Greenhouse Gas Emissions – Scope Two
When energy is consumed, an enterprise must report the emissions related to that consumption under scope two. The scope emissions are relatively easy to categorize, often by reference to meters.
Greenhouse Gas Emissions – Scope Three
When it comes to the third scope, reporting for this scope is still classified as optional and can relate to emissions spent as a consequence of employee travel, supplier activities, etc. You will likely have to compose a lifecycle analysis and identify the entire supply chain to identify the scope of emissions associated with your operation in this way.
It is not uncommon to find that a considerable amount of emissions is associated with the production of materials that you purchase for your business. Likewise, end-of-use disposal emissions should be identified.
Identification of All Emission Scopes
Identification and categorization of all emission scopes, be they direct, indirect or optional can be quite a complex task and must be the responsibility of the highest levels of management. While reporting requirements may be identified as voluntary, they can become mandatory in short order. In addition, carbon pollution awareness has become mainstream and has attracted the direct interest of consumers.
It is in the best interests of the enterprise to ensure that it is entirely transparent and has exercised extreme care and diligence when identifying its operational boundary and the variety of emission scopes that are part of its responsibility.