How to Calculate Your Company's GHG Emissions: A Practical Guide
A step-by-step guide to understanding and calculating Scope 1, 2, and 3 greenhouse gas emissions for your sustainability reporting.
By VSME Reporter Team
Why GHG Emissions Matter
Understanding your company's greenhouse gas (GHG) emissions is fundamental to sustainability reporting and environmental management.
- Meet regulatory requirements (CSRD, VSME)
- Respond to investor and customer demands
- Identify cost-saving opportunities
- Track progress toward climate goals
- Maintain competitive advantage
Scope 1: Direct Emissions
Scope 1 covers all direct GHG emissions from sources owned or controlled by your company.
Common Sources
- Company vehicles (cars, trucks, forklifts)
- On-site heating (gas boilers, furnaces)
- Industrial processes (manufacturing, production)
- Refrigerant leaks (air conditioning, cooling systems)
Practical Calculation Examples
Vehicle Fleet
If your company uses 10,000 liters of diesel per year: 10,000 L × 2.68 kg CO₂/L = 26,800 kg CO₂ = 26.8 tonnes CO₂
Natural Gas Heating
For 50,000 kWh of natural gas: 50,000 kWh × 0.182 kg CO₂/kWh = 9,100 kg CO₂ = 9.1 tonnes CO₂
Scope 2: Indirect Energy Emissions
Scope 2 covers indirect emissions from the generation of purchased energy consumed by your company.
Location-Based Method
Uses average emission factors for the local electricity grid. Simple to calculate but doesn't reflect renewable energy choices.
Market-Based Method
Reflects emissions from electricity you've specifically chosen. Allows credit for renewable energy contracts and certificates.
Practical Calculation Examples
Location-Based (Sweden)
100,000 kWh electricity × 0.045 kg CO₂/kWh (Swedish grid) = 4,500 kg CO₂ = 4.5 tonnes CO₂
Market-Based (Renewable Contract)
With 100% renewable electricity contract: 100,000 kWh × 0 kg CO₂/kWh = 0 tonnes CO₂
Scope 3: Value Chain Emissions
Scope 3 includes all other indirect emissions in your value chain. This is typically 70-90% of total emissions for most companies.
Key Categories
Upstream Activities
- Purchased goods and services
- Capital goods
- Fuel and energy-related activities
- Upstream transportation
- Waste generated in operations
- Business travel
- Employee commuting
Downstream Activities
- Downstream transportation
- Processing of sold products
- Use of sold products
- End-of-life treatment
- Franchises
- Investments
Practical Calculation Examples
Business Travel (Flights)
Stockholm to London return flight: 2 × 1,500 km × 0.255 kg CO₂/km = 765 kg CO₂ per trip
Employee Commuting
50 employees × 30 km/day × 220 days × 0.12 kg CO₂/km (average) = 39,600 kg CO₂ = 39.6 tonnes CO₂/year
Purchased Materials
10 tonnes of steel × 1,850 kg CO₂/tonne = 18,500 kg CO₂ = 18.5 tonnes CO₂
Step-by-Step Calculation Process
Define Boundaries
Determine organizational and operational boundaries for your emissions inventory.
Collect Activity Data
Gather data on fuel consumption, electricity use, travel, purchases, and other relevant activities.
Select Emission Factors
Choose appropriate emission factors from recognized databases (GHG Protocol, IPCC, national databases).
Calculate Emissions
Multiply activity data by emission factors: Activity Data × Emission Factor = Emissions
Verify and Report
Review calculations for accuracy, document methodology, and prepare your report.
Common Challenges and Solutions
Missing data
Use industry averages or estimates initially, then improve data collection over time.
Complex supply chains
Start with major suppliers and expand coverage gradually.
Choosing emission factors
Prefer local/specific factors when available; use global averages as fallback.
Year-over-year consistency
Document methodology carefully and apply consistently across reporting periods.
Next Steps After Calculation
Once you've calculated your emissions, take action:
- Set reduction targets (aligned with Science Based Targets if possible)
- Identify quick wins (often in energy efficiency)
- Engage suppliers on their emissions
- Report transparently to stakeholders
- Monitor progress and iterate
Start Your Journey
Calculating GHG emissions may seem complex, but with the right tools and methodology, any SME can build a comprehensive emissions inventory. The key is to start, even if imperfect, and improve over time.