How to calculate a company’s carbon footprint? Methodology, standards and data sources
A carbon footprint is the total amount of greenhouse gas emissions generated by a company’s activities. It includes both direct emissions and indirect emissions across the entire supply chain. The result is usually expressed in tons of carbon dioxide equivalent. Calculating an organization’s carbon footprint is now becoming mandatory under regulations such as the Corporate Sustainability Reporting Directive, but its importance goes far beyond legal requirements.
Why should companies calculate their carbon footprint?
Companies that aim to operate in line with sustainable development can use carbon footprint calculations to better determine their emission levels, identify key sources, optimize the use of fuels and energy, and plan effective reduction strategies.
Regular monitoring of emissions also helps increase energy efficiency, reduce operating costs, and build a positive image in the eyes of financial institutions and customers, who are increasingly expecting transparency in the reporting of non-financial information.
Which greenhouse gases make up the carbon footprint?
The most important greenhouse gases include:
- CO₂ (carbon dioxide) – produced mainly by the combustion of fossil fuels in energy production, industry, transport, and manufacturing processes.
- CH₄ (methane) – emitted during agricultural processes (such as cattle farming), waste management (landfills), as well as gas and coal extraction.
- N₂O (nitrous oxide) – generated mainly through the use of fertilizers in agriculture and certain industrial processes.
It is worth noting that some fluorinated greenhouse gases used in refrigeration and air conditioning, although emitted in smaller amounts, have a very high global warming potential and significantly contribute to global warming. Including these gases in calculations is essential to ensure that a company’s carbon footprint assessment provides a reliable picture of its impact on the natural environment.
What is the GHG Protocol (Greenhouse Gas Protocol) and how does it divide emissions into scopes?
The Greenhouse Gas Protocol is an international standard for calculating an organization’s carbon footprint and reporting emissions. Its application ensures consistency in emission calculations and aligns with global reporting frameworks, such as the Global Reporting Initiative.
What is Scope 3 in the calculation of an organization’s carbon footprint?
The GHG Protocol methodology divides emissions into three main scopes:
- Scope 1 – includes direct emissions resulting from fuel combustion in stationary installations, vehicles belonging to the organization’s fleet, as well as employee commuting and business travel.
- Scope 2 – covers indirect emissions related to purchased electricity, heating, or cooling, and can be calculated using both the market-based method, which relies on actual energy sources, and the location-based method, which reflects the energy mix of the region.
- Scope 3 – encompasses other indirect emissions generated throughout the entire supply chain, including the production of raw materials and products, the provision of services, transportation and distribution, product use by customers, and waste disposal.
A full inclusion of all three scopes makes it possible to accurately assess a company’s environmental impact and identify areas where emissions can be effectively reduced.
Where can companies find the data needed to calculate their carbon footprint?
The accuracy of carbon footprint calculations largely depends on the quality of data collected within the organization. In practice, this requires collaboration between different departments. The accounting and finance departments can provide invoices for electricity, fuels, or purchased products and services. The administration or HR departments hold information on employee commuting and business travel, while the logistics department can supply data on transport and distribution.
The production and maintenance teams can provide information on fuel combustion in stationary installations or raw material consumption. Data on production waste and other indirect emissions throughout the supply chain are also essential.
Bringing all this information together in one place not only enables the calculation of an organization’s carbon footprint but also helps identify which areas require greater energy efficiency and where real reductions in greenhouse gas emissions can be achieved.
How to calculate emissions from electricity – what is the difference between the market-based and location-based methods?
Scope 2 covers emissions resulting from energy consumption, which can be calculated using two methods:
- Market-based – relies on the actual energy sources used by the organization, including renewable energy purchase agreements, guarantees of origin, or in-house renewable installations. It highlights the actions taken to reduce greenhouse gas emissions and improve energy efficiency.
- Location-based – takes into account the average energy mix of the region or country where the company operates, regardless of its individual purchasing decisions. In calculating an organization’s carbon footprint, it is recommended to use both methods simultaneously to gain a more complete picture of the company’s impact on the natural environment and global warming.
Using both methods provides a fuller perspective: the location-based method reflects the regional impact, while the market-based method demonstrates the company’s actual actions in choosing energy sources.
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How to calculate Scope 3 emissions and what data methods are used?
Scope 3 covers all indirect emissions generated across a company’s entire value chain. These include emissions from the production of purchased goods, the transportation of raw materials, the use of sold products, and the disposal of waste.
To calculate Scope 3, three main data methods are used:
- Supplier-specific – this method relies on accurate emissions data obtained directly from the supplier. This means that if an organization works with a particular supplier of products or services, it takes into account the actual emissions data generated by that supplier’s operations. Such data is more precise because it comes directly from suppliers who provide real information about their emissions. However, it requires strong supplier collaboration and overcoming challenges that may arise when attempting to obtain such data.
- Average data – this method is based on industry or product-category averages, which reflect typical emissions for a given sector. Instead of using actual data from a specific supplier, average values for similar types of suppliers or products are applied. These data are more easily accessible and quicker to obtain when supplier-specific data are not available. However, they are less precise, since they are based on general indicators rather than actual emissions.
- Spend-based – this method calculates emissions based on the amount of money spent on products or services. It is quick and simple to apply, especially when detailed emissions data are unavailable. Unfortunately, it is significantly less accurate, as it relies on average emissions factors linked to expenditure, which can result in approximate estimates.
Companies often start with simplified methods (average or spend-based) and gradually move towards the more precise supplier-specific approach as their reporting systems mature and they gain better access to supplier data.
What databases and tools can be used to calculate emissions?
Carbon footprint calculations draw on a wide range of international and national databases that provide emission factors for different sectors of the economy. These are commonly used sources, verifiable, and globally recognized as reliable. They allow organizations to base their calculations on solid methodological foundations aligned with reporting standards.
Specialized tools such as Plan Be Eco automate the process of collecting and converting data. The platform ensures that the right emission factors are assigned to a company’s specific activities, eliminating the risk of errors and removing uncertainties related to choosing the correct values. Users do not need to worry about updating data or tracking methodological changes—the system does it automatically. This makes reporting not only compliant with ESG regulations and EU directives such as CSRD but also practical and transparent across the organization.
What determines the accuracy of carbon footprint calculations?
It is important to note that the accuracy of results largely depends on the quality of the data entered by the company. The more detailed and reliable the information on fuel consumption, electricity use, employee travel and commuting, emissions from stationary installations, and the entire supply chain, the more trustworthy the report will be.
Organizations that invest in obtaining supplier-specific data can more accurately assess remaining indirect emissions, plan reduction strategies, and make informed changes in managing their fleet, energy use, and production waste. As a result, companies can achieve real reductions in greenhouse gas emissions and increase energy efficiency across the entire organization.
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What are the biggest challenges in calculating a carbon footprint?
The biggest challenges in calculating a carbon footprint primarily involve obtaining reliable data from suppliers, comprehensively capturing the entire value chain, and distinguishing between direct and indirect emissions. Companies often struggle to accurately estimate emissions related to employee commuting, business travel, or electricity consumption in stationary installations.
In practice, it is worth starting with simpler calculation methods, such as average data or spend-based, and then gradually moving toward more accurate supplier-specific data, while implementing emission monitoring processes over a defined period and reporting within the ESG strategy framework.
How to start measuring greenhouse gas emissions in a company step by step?
The first step in calculating a carbon footprint is to identify all emission sources, both direct and indirect, across the entire supply chain. Next, the GHG Protocol methodology should be applied, assigning emissions to the appropriate scopes and choosing data methods that best fit your company.
The following stage involves collecting data and systematically analyzing it over a defined period, which allows the company to identify the main sources of greenhouse gas emissions and set reduction targets. Based on the results, the organization can implement actions aimed at reducing fuel combustion, optimizing electricity use, improving energy efficiency in stationary installations, and better managing production waste.
This way, calculating a carbon footprint becomes not only a reporting obligation but also a practical tool for supporting climate neutrality and sustainable development.
