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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Environment

Bharat Textiles Ltd. buys 2,000 MWh of grid electricity in a year. The grid emission factor is 0.8 tCO2e per MWh. It also buys 500 MWh of renewable certificates that are validly claimed under the market-based method. What is its Scope 2 emission under the market-based method, assuming the remaining electricity carries the grid factor?

The Scope 2 emission is 1,200 tCO2e. The 500 MWh covered by valid renewable certificates is counted as zero, leaving 1,500 MWh at 0.8 tCO2e per MWh. Ignoring the certificates would wrongly give 1,600 tCO2e.

  1. A1,200 tCO2eCorrect
  2. B1,600 tCO2e
  3. C400 tCO2e
  4. D2,000 tCO2e

Explanation

Certified renewable electricity of 500 MWh is treated as zero-emission, so the remaining 1,500 MWh is multiplied by 0.8, giving 1,200 tCO2e. Check: 2,000 x 0.8 = 1,600 less 500 x 0.8 = 400 gives 1,200. The 1,600 option ignores the certificates, and 400 counts only the certified portion.

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