Carbon jargon

Carbon jargon

A broad range of terminology is used to describe corporate goals and commitments when it comes to climate change. Some of these terms are used interchangeably such as ‘carbon neutral’, ‘net zero’ and ‘climate neutral’.

We created this page to shed light on the net zero terminology to assist organisations in setting meaningful climate targets. If there is anything missing, can you please let us know, and we’ll add it.

Your energy and carbon footprint

Carbon footprint

A carbon footprint is the sum of emissions that are relevant for your organisation, a big part of which is your energy consumption. You can develop a narrow carbon footprint of emissions that happen at your place of business (scope 1) and the emissions associated with electricity consumption (scope 2). Alternatively, you can develop a wide carbon footprint that also includes emissions in your value chain (scope 3).

A carbon footprint is usually broader than your energy footprint. You can see in Figure 1 that an energy footprint is a subset of a carbon footprint. From a carbon accounting perspective, your energy footprint relates to your scope 2 emissions and to some of your Scope 1 emissions.

Energy footprint

Your energy footprint relates to your business’ energy consumption. For most organisations, ‘energy’ encompasses not only electricity but also stationary energy and transport fuels. Examples of stationary fuels are natural gas, diesel for generators, and LPG for forklifts. Examples of transport fuels include diesel, petrol, and LPG that power your fleet.

Emission sources

Scope 1

Scope 1 emissions are emissions directly generated at your operations, such as burning natural gas or driving company cars, or refrigerant gases in your air conditioning equipment.

Scope 2

Scope 2 emissions are caused indirectly by consuming electricity. These emissions are generated outside your organisation (think coal-fired power station), but you are indirectly responsible for them.

Supply chain emissions

This is another term for scope 3 emissions. They are also called value chain emissions.

Scope 3

Scope 3 emissions are also indirect emissions and happen upstream and downstream of your business. Examples are waste, air travel, the consumption of goods and services, contractor emissions, or leased assets.

Categories of scope 3 emissions

According to the GHG Protocol, specifically the Corporate Value Chain Accounting and Reporting Standard, there are 15 categories of value chain, or scope 3 emissions.

Upstream value chain emissions

  1. Purchased goods and services
  2. Capital goods
  3. Fuel- and energy-related activities (not included in scope 1 or scope 2)
  4. Upstream transportation and distribution
  5. Waste generated in your operations
  6. Business travel
  7. Employee commuting
  8. Upstream leased assets

Downstream value chain emissions

  1. Downstream transportation and distribution
  2. Processing of sold products
  3. Use of sold products
  4. End-of-life treatment of sold products
  5. Downstream leased assets
  6. Franchises
  7. Investments