Measure your carbon emissions

Knowing how much carbon your business produces is an important step for managing costs and moving towards net zero.

By reducing emissions, you can:

• demonstrate your commitment to sustainability
• identify inefficiencies in your operations
• prepare a Carbon Reduction Plan (CRP) that proves you are taking action
• build a positive reputation that can attract new customers and investors

Use the GHG Protocol to measure emissions: Scopes 1, 2 and 3
Do a basic calculation to measure your emissions
Calculate using conversion factors
Hire a consultant
Set targets to reduce carbon emissions
Get support for your carbon reduction plan
Take action to reduce emissions
Track and share your progress

Use the GHG Protocol to measure emissions: Scopes 1, 2 and 3

The Greenhouse Gas (GHG) Protocol is widely used to report carbon emissions to the government, suppliers, investors and others.

It puts emissions into categories called ‘scopes’ and provides a more complete accounting of the carbon produced by your business.

Scope 1

Emissions produced directly from your business activities, including:

petrol or diesel used by company vehicles
LPG, natural gas or other fuel burned on site
refrigerant losses
land owned by business or under its operation

Scope 2

You are directly responsible for indirect emissions from energy bought and consumed by the company.

These include emissions from purchased electricity, cooling, heat and steam your business buys or acquires.

Scope 3

You are also responsible for emissions produced indirectly from your business activities.

Scope 3 emissions occur upstream (from the supply chain) and downstream (through customer use) and typically account for most of a business’s emissions.

Emissions produced indirectly from your business activities include:

water supply and treatment
shipping and distribution
employee commuting
goods and services you buy
how customers use your goods and services
financial services, including emissions from pension funds and the investments made by banks holding company money

Goals for measuring scopes 1, 2 and 3

Ambitious yet achievable goals will guide your strategies and provide a clear pathway for reducing emissions over time.

You can make a pledge with the internationally recognised SME Climate Commitment.

This pledge states that enterprises will need to do their utmost to cut their greenhouse gas emissions by at least 50% before 2030, using 2019 or later as the base year.

This means that Scope 1 and Scope 2 emissions must be cut in half by 2030 at the latest. Businesses should also aim to halve their most material Scope 3 emissions by 2030.

Do a basic calculation to measure your emissions

The simplest way to get started is to collect yearly amounts of electricity use, fuel consumption and refrigerant top-ups related to your business.

Using 12 months of data allows seasonal variations to average out. It can be helpful to align the measurement period with your financial or calendar year.

To do this you will need yearly totals for:

electricity in kilowatt hours (kWh)
natural gas in kWh or cubic metres
liquefied petroleum gas (LPG) in litres
petrol or diesel in litres from invoices and receipts or mileage from logbooks
water use in cubic metres
refrigerant top-ups in kilograms
business travel requests
tonnes of waste sent for disposal via your waste contractor

Calculate using conversion factors

Scope 1 and 2

Use your data to calculate your carbon emissions.

Choose one of the free carbon calculators to calculate emissions in metric tonnes per year. This will give you an emissions baseline as a reference point against which you can measure your greenhouse gas (GHG) emissions going forward.

The equation you need is:

Emissions = total energy consumption (fuel, electricity) x emission factors (fuel, electricity)

For the same mass of emissions, different greenhouse gases warm the atmosphere different amounts.

Use the government-agreed conversion factors to express non-CO2 emissions in terms of an equivalent CO2 warming effect – a metric known as ‘CO2-equivalent’, or ‘CO2e’.

Check GOV.UK for the latest conversion factor spreadsheets.

Scope 3

Scope 3 emissions are often complex and more difficult to measure. Start with data that you have and gradually improve methodology to increase the accuracy of scope 3 measurements.

To help decide what should be counted in Scope 3 calculations, visit GHG Protocol and download their detailed guide on measuring Scope 3 emissions.

Some strategies that contribute to effective Scope 3 emission assessment include:

Using standardised emission factors and conversion coefficients relevant to your specific industry to estimate scope 3 emissions. You can then compare your performance against industry averages to identify areas for improvement.
Carrying out a life cycle assessment (LCA) strategy to identify and address the carbon emissions at different stages of your product or service’s life. The life cycle stages are:

raw material extraction
production
transportation and storage
product use
end-of-life disposal

Maintaining LCAs is important as your operator customers may ask for these when they assess emissions that come from purchasing your products.

Find out how to get low carbon labels and sustainability certifications to assess the environmental impact of your product or services

3. Using advanced data analytics and technology solutions to process large datasets and enhance the accuracy of emissions measurements.

Hire a consultant

Consider hiring a sustainability consultant if you can’t measure your carbon emissions on your own.

They can create a strategy to measure emissions in line with your business needs.

Set targets to reduce carbon emissions

A detailed inventory of your emissions is the foundation for an accurate baseline. Set targets to reduce costs and your carbon footprint.

Prioritise your emission hotspots where there are:

the highest amounts of emissions
the emissions with the highest value or associated costs
emissions with an associated environmental risk, such as hazardous wastes

Focus on where you can:

save the most money
access practical advice to make changes
make immediate savings on no-cost and low-cost wins

Set clear Key Performance Indicators (KPIs) for measuring and tracking your company’s sustainability progress. These KPIs should be specific, measurable, achievable, relevant, and time-bound (SMART).

Make a simple, public commitment to cut emissions with the SME Climate Commitment.

Get support for your carbon reduction plan

You will need to engage your team in your carbon reduction plan in order to:

embed net zero strategies in your business
ensure adequate resources
monitor targets and follow a timeframe to reduce your scope emissions
share progress

Find out more about how to train and involve your team.

Stakeholder engagement is also essential. It requires you to collaborate with suppliers, customers, and other stakeholders to gather relevant emission information.

Take action to reduce emissions

After you have calculated your emissions, you can take action to reduce costs and your carbon footprint.

Examples of actions include:

Develop a supply chain hot spot analysis so that you know what areas of your supply chain to prioritise engagement with.

Encourage your suppliers to:

find lower carbon alternatives for products
sign up to the SME Climate Commitment

This will help the supply chain as a whole become more transparent and sustainable.

Visit our page to find out how to become a ‘net-zero’ ready supplier.

Track and share your progress

You will need to regularly monitor and report your emissions data against your established baseline. This will ensure accountability and help you progress towards your organisation’s emission reduction goals.

Let your stakeholders (customers, employees, suppliers, board, etc) know about: