CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Environment
Kaveri Steel Ltd. reports emissions from the electricity it buys from the state grid to run its rolling mill. Under the GHG Protocol classification, how are these emissions categorised?
These emissions are Scope 2 under the GHG Protocol, because they are indirect emissions from purchased electricity consumed by the company. Scope 1 covers only direct emissions from sources the company owns or controls, and Scope 3 covers other value-chain emissions.
- AScope 1, as the company consumes the power
- BScope 2, as indirect emissions from purchased electricityCorrect
- CScope 3, as they arise in the value chain upstream
- DNot reportable, as the company does not generate the electricity
Explanation
Scope 2 covers indirect emissions from purchased electricity, steam, heating or cooling. Scope 1 covers direct emissions from owned or controlled sources, such as the company's own boilers. Scope 3 covers other value-chain emissions, so it does not fit here.
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