Emission Factors: Location, Market, and Supplier-based

What do I need to know?

Location-based: Reflects the average emission intensities of either national or regional energy grids. Ideal for compliance reporting. However, it does not consider renewable energy consumption or specific supplier emissions.

Market-based: Offsetting credits or renewable energy certificates are considered in the emission factors of the market-based method. Taking into account companies’ purchases of renewable energy and investments in emission reduction projects. This can provide a more accurate picture of companies’ carbon footprint. However, verifying and tracking offsetting projects are complex.

Supplier-based: Offers the most accurate representation! In the real estate sector, emissions from specific utility suppliers of heating, water, gas, cooling, etc., give a complete overview of emissions and enhance the reporting quality. It’s also pivotal for data-driven CO2 reduction strategies in the future.

Why is this relevant?

First of all, regulatory frameworks typically require reporting on location-based emissions.

Leading carbon reporting frameworks such as PCAF, the GHG Protocol, World Resources Institute, and CDP all advocate for reporting on all three emission factors types.

Using all three methods ensures 3 key things.

• Regulatory compliance
• Complete overview of your carbon footprint
• Enhances reporting quality.