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Jargon... but useful jargon.

Danny Ruspandini - Impact Labs Australia
Danny R.

Some useful jargon that might help get your head around measuring your emissions footprint. More importantly, it helps to see what’s in your control and what’s not, and where the challenges lie with reducing your footprint.

The jargon is Scope 1, Scope 2 and Scope 3 emissions - all emissions fall into one of these:

Scope 1: Direct Emissions

Are emissions your organisation directly creates and has control over. If you own a fleet of vehicles for example, the emissions from those vehicles contribute to your Scope 1 emissions. If you manufacture anything like concrete or shoes or toys, or mine oil, or turn fossil fuels into electricity for others to use, you create Scope 1 emissions.

Scope 2: Indirect Emissions (owned by you)

This is almost exclusively where you source your energy, so either it's your power supplier or the power you generate yourself. In other words, even if the power is “created” elsewhere, you have the on/off switch at your workplace and can technically control how much you use.

Scope 3: Indirect Emissions (not owned by you)

This is literally everything else, and there’s a lot of everything else. 15 categories in total, but at a high level it includes:

  • Anything you buy from someone else (ie: your supply chain)
  • The waste you create
  • Your travel (flying for business, and even your teams’ commute to work)

As well as more complicated categories like:

  • The companies you choose to invest in
  • Assets you lease
  • The companies you’re a customer of (eg: banks and super funds) who use your money to invest in other things
  • If your company has franchises, the emissions from those franchises fall under your own Scope 3 emissions

When you hear the term supply chain, think Scope 3.

An easy trap here is that you’re not the end of the chain - you buy from suppliers, but you also sell services, create waste, and generate business for others. You’re a link in the chain. To the person you sell to, you’re part of their supply chain.

...which means every business, from a single freelancer to Amazon, is part of a supply chain. So this one affects us all.

Low hanging fruit

For Scope 1, unless you manufacture things, have fleet vehicles, or operate mines, this probably wont affect you much. As a service-based business or consultancy, you might only really be dealing with vehicles in which case... just switch to electric vehicles - easy right? 😉

For Scope 2, it’s not uncommon to see companies with 0% Scope 2 because, for example, they have solar panels. Not exactly cheap or easy to do but if you can, you can tick off Scope 2 almost entirely. The next best option, and a much easier one, is to switch an energy provider that generates their energy from renewable sources (see a list of providers here by ranking, and do a little due diligence).

Seeing companies with 90% of their emissions sitting in Scope 3 is not outrageous, as it’s all the stuff you have no control over. What you do have control over in most cases though, is who you choose to deal with - who your suppliers are, who you invest in, who you bank with, etc.

The Market Forces website lists banks, super funds and insurance companies divided into the ones that invest in nasty stuff like coal mines and weapons, from those who invest in good stuff like renewable energy and education. Again, research and due diligence is required - but it's a safe bet to switch away from the big 4 banks, and the big few energy suppliers.

It’s a lot to process

Personally, seeing this all separated out into Scopes really helped me see where to get started.

I run a small consultancy of (currently) just myself plus a handful of contractors, so I don't generate Scope 1 emissions.

I live in an apartment and work from home - we’re looking at solar panels as a complex, but for the moment have switched to a renewable energy supplier to address Scope 2.

For Scope 3, I’ve switched our business banking to Bank Australia, and am in the process of switching Super funds and mortgage as well. Plus I’m constantly looking for alternate suppliers throughout our modest supply chain. When I can't find an ideal alternative, I'll often just look for a local one.

It’s a step at a time - but slowly your footprint starts to reduce either by you making changes, or the companies you work with making improvements. It's never really finished, you just keep moving forward.

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