Scope 1, 2 and 3 of Fashion Industries' carbon emissions

Sana
Feb 10, 2022
1 min read

Carbon emissions are responsible for 81% of overall GHG emissions, and businesses are responsible for a lot of it. Fashion businesses must monitor and report their CO2 emissions, which is the key first step in reducing them. To do so, companies must classify their carbon footprint in three scopes.

"Companies that persist in treating climate change solely as a corporate social responsibility issue, rather than a business problem, will risk the greatest consequences."

-Michael E. Porter

Explained: Scope 1, 2 & 3 emissions

According to the leading GHG Protocol corporate standard, a company’s greenhouse gas emissions are classified into three scopes. Scope 1 and 2 are mandatory to report, whereas scope 3 is voluntary and the hardest to monitor. However, companies succeeding in reporting all three scopes will gain a sustainable competitive advantage.

Source: Scheme 1,2,3 scope emissions- Plan A based on GHG protocol

Scope 1: direct emissions

Scope 1 emissions are direct emissions from company-owned and controlled resources. It is divided into four categories:

> Stationary combustion (e.g fuels, heating sources). All fuels that produce GHG emissions must be included in scope 1.

> Mobile combustion is all vehicles owned or controlled by a firm, burning fuel (e.g. cars, vans, trucks). The increasing use of “electric” vehicles (EVs), means that some of the organization fleets could fall into Scope 2 emissions.

> Fugitive emissions are leaks from greenhouse gases (e.g. refrigeration, air conditioning units). It is important to note that refrigerant gases are a thousand times more dangerous than CO2 emissions. Companies are encouraged to report these emissions.

>Process emissions are released during industrial processes, and on-site manufacturing (e.g. production of CO2 during manufacturing textile)

Scope 2: indirect emissions – owned

Scope 2 emissions are indirect emissions from the generation of purchased energy, from a utility provider. In other words, all GHG emissions released in the atmosphere, from the consumption of purchased electricity, steam, heat and cooling.

Scope 3: indirect emissions – not owned

This occurs in the value chain of the reporting company, including both upstream and downstream emissions, which according to GHG protocol are separated into 15 categories.

Upstream Emissions:

Upstream activities fall under several categories: business travel, employee commute, waste generated in operations relates to waste sent to landfills and wastewater treatments. Purchased goods and services, includes all the upstream (‘cradle to gate’) emissions from the production of goods and services purchased by the company in the same year. Transportation and distribution occur in upstream (suppliers) and downstream (customers) elements of the value chain. Fuel and energy-related activities include emissions relating to the production of fuels and energy purchased and consumed by the reporting company, in the reporting year that is not included in scope 1 and 2. Capital goods are final products that have an extended life and are used by the company to manufacture a product, provide a service or, store, sell and deliver merchandise.

Downstream Emissions:

Investments made in one accounting year, Franchises should include emissions, from operations under their control. Leased assets correspond to leased assets by the reporting organisation (upstream) and assets to other organisations (downstream). Use of sold products is included, concerning “in-use” products that are sold to the consumers At the same time, “end of life treatment” corresponds to products sold to consumers, and is reported similarly as “waste generated during operations”

Critical to measure Scope 3 emissions:

Scope 3 emissions account for more than 90% of GHG emissions in majority of businesses. Therefore companies must conduct a full GHG emission inventory – scope 1, 2 and 3 – to focus their efforts on reducing carbon emissions, carbon footprint and becoming carbon-neutral.