What encompasses Scope 2 emissions?

Scope 2 emissions specifically refer to the indirect greenhouse gas emissions resulting from the generation of purchased electricity, steam, heating, and cooling consumed by the reporting company. This means that while the company does not directly emit these gases, it is responsible for them due to its energy consumption choices.

Understanding Scope 2 is vital in sustainability accounting because it highlights the impact of energy procurement and usage on a company's overall carbon footprint. By focusing on indirect emissions, organizations can identify opportunities to reduce these emissions through strategies like increasing energy efficiency, switching to renewable energy sources, or buying energy from low-carbon suppliers.

In contrast, direct emissions from controlled sources are classified as Scope 1, while emissions from waste disposal relate to Scope 3, which encompasses all other indirect emissions in the value chain. Likewise, transportation-related emissions, if they pertain to company-owned vehicles, would also be Scope 1, while those related to third-party transportation providers fall into Scope 3.