Scope 1, 2 and 3 emissions

Indian Economy glossary

Topic: Environment and Sustainable Development · NCERT: Beyond NCERT

Meaning

The GHG Protocol sorts a company's greenhouse gas emissions (heat-trapping gases like CO2) into three groups:

  • Scope 1: direct emissions from sources the firm owns, such as its own boilers or vehicles.
  • Scope 2: indirect emissions from the electricity, heat or steam the firm buys.
  • Scope 3: all other emissions in the value chain, which means the whole chain from suppliers to customers.

This split lets firms measure and disclose emissions without counting them twice. It is used in SEBI's Business Responsibility and Sustainability Report (BRSR), which has been mandatory for the top 1,000 listed companies since FY 2022-23.

Example

For a cement company, burning coal in its own kiln is Scope 1. Grid electricity used in its plant is Scope 2. Trucks run by outside transporters and emissions from its suppliers are Scope 3.

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