Scope 2 emissions from electricity and heat: how to calculate them

Scope 2 is the part of a carbon footprint most companies can calculate precisely, because the activity data is on the energy bill. The Corporate Standard defines it as "GHG emissions from the generation of purchased electricity consumed by the company"; the Scope 2 Guidance extends this to purchased heat, steam and cooling.

Step 1: collect consumption

• Electricity: kWh per meter or site for the reporting year, from invoices or half-hourly data. Use consumption, not cost.
• Heat, steam and cooling bought from a network: kWh from the supplier's statements.
• Electric vehicles charged at your sites are already in your site electricity; do not count them again.

If a bill covers a period that straddles your reporting year, split it pro rata by days and note that you did.

Step 2: choose the location-based factor

The location-based method "reflects the average emissions intensity of grids on which energy consumption occurs", so you use the official grid average for the country and year of consumption.

The two are not directly comparable: the DESNZ factor is CO2e for generation and leaves grid losses to Scope 3, while ISPRA's consumption factor is CO2 only and already includes grid losses. The guide to Italian factors explains ISPRA's options in detail.

Step 3: add the market-based figure

If you buy electricity on a contract with its own emission rate, or hold certificates such as guarantees of origin, you also report a market-based total. The Scope 2 Guidance says companies in such markets "shall report scope 2 according to a location-based method and a market-based method". The location-based vs market-based guide covers the quality criteria and the residual mix.

Step 4: heat and steam

For heat or steam from a district network, multiply the kWh delivered by a heat factor. DESNZ 2026 gives 0.17529 kg CO2e per kWh for district heat and steam. Losses in the heat network are reported in Scope 3 category 3, as for electricity.

Step 5: report

A minimal Scope 2 disclosure states:

• total kWh by energy type and country;
• location-based and (if applicable) market-based totals, each labelled with its method;
• the factor sources and years, and for market-based, the instruments used;
• any estimates, such as months filled from a previous year.

Worked example

A company has offices in London (60,000 kWh) and Milan (40,000 kWh). For illustration, this uses the DESNZ 2026 factor and ISPRA's latest final year (2024); in practice, use each source's factor for your reporting year.

State in the report that the Italian figure is CO2 only and includes grid losses, and that the UK grid losses are reported in Scope 3 category 3. Using factors from different sources is normal for multi-country inventories; mixing them without saying so is what causes errors.

Related

• Scope 1, 2 and 3 emissions explained
• Scope 3 category 3: well-to-tank and grid losses