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Corporate and government entities have been developing and reporting greenhouse gas (GHG) emission inventories, some for well over a decade. The basis for developing these inventories has evolved from voluntary mechanisms (e.g., sustainability reports; registries like the DOE 1605(b) or The Climate Registry) to regulatory requirements (e.g., EU Emissions Trading Scheme, US EPA Mandatory Reporting Rule, California AB 32, Canadian Federal and provincial requirements). Additionally, stakeholders continue to influence carbon disclosure through means such as shareholder resolutions and initiatives that target specific companies, industries, or segments of society.

To accommodate these trends, protocols, standards, and guidelines have progressively developed, moving from basic calculation/reporting of corporate or facility inventories to assessing the GHG impact or footprint of a company’s products or entire supply chain.
However, developing a corporate/facility inventory versus estimating a product/process carbon footprint requires different tools, assumptions and considerations. This article briefly examines and compares some of these protocols and standards, and presents several case examples that illustrate the differences and challenges.

GHG Definitions and Objectives

It is important to understand the underpinnings and differences between GHG inventories, carbon footprints, and lifecycle GHG emissions. In fact, some basic terms derived from the ISO 14064-1, -2 and -3 standards and PAS 2050: 2008 protocol developed by the British Standards Institute are shown in Figure 1. The terms are organized into three groups:

  1. Those components specific to a GHG inventory (shown in green) include direct (i.e., Scope 1), energy indirect (i.e., Scope 2) and other indirect (i.e., Scope 3) GHG emissions. Scope 1 and 2 emissions are most frequently reported, while Scope 3 emissions have to date mostly been developed on a voluntary basis. One exception to this is U.S. Federal reporting of GHG emissions under Executive Order (EO) 13514 (Federal Leadership in Environmental, Energy, and Economic Performance), where annual reporting of selected categories of Scope 3 emissions is required.
  2. Those components specific to the use of GHG inventory information (shown in blue), focus on the manner in which GHG emissions information is presented, assured and viewed by the user. The concept of materiality, ‘that individual or an aggregate of errors, omissions and misrepresentations could affect the GHG assertion and could influence the intended users’ decisions’, is central to the validity of reported information. It should also be noted that GHG reporting does not always require independent verification.
  3. Those that go beyond basic Scope 1, 2 and 3 GHG inventories (highlighted in purple) extend the application of GHG accounting to quantifying the carbon attributes of activities, products and processes, and carbon accounting throughout the value chain of an enterprise (i.e., from ‘cradle to grave’). Such accounting also can form the basis for product certifications such as UL’s Sustainable Product Certification and the Green-e GHG Reduction Product Certification. 

    GHG Word Chart
Protocols Comparison

There are numerous protocols, standards and guidelines that can be used to develop and report carbon inventories and footprints. A selection of these is listed below.

  • The GHG Protocol – A Corporate Accounting and Reporting Standard, World Resources Institute (WRI)/World Business Council for Sustainable Development (WBCSD) (2004) and Sector-specific protocols
  • Specification with Guidance at the Organization Level for Quantification and Reporting of Greenhouse Gas Emissions and Removals, ISO 14064-1:2006
  • Specification with Guidance at the Project Level for Quantification, Monitoring and Reporting of Greenhouse Gas Emission Reductions or Removal Enhancements, ISO 14064-2:2006
  • The Climate Registry (TCR), General Reporting Protocol (GRP) (2008) and Sector-specific protocols
  • Federal Greenhouse Gas Accounting and Reporting Guidance & Technical Support Document, Council on Environmental Quality (2010)
  • The GHG Protocol for the U.S. Public Sector, WRI (2010)
  • 10 CFR Part 300, Guidelines for Voluntary Greenhouse Gas Reporting (Section 1605(b) of the Energy Policy Act of 1992)
  • 40 CFR 98, Mandatory Reporting of Greenhouse Gases (MRR)
  • Specification for the Assessment of the Lifecycle Greenhouse Gas Emissions of Goods and Services, PAS 2050:2008, 2011
  • Corporate Value Chain (Scope 3) and Product Life Cycle Accounting and Reporting Standards, WRI/WBCSD (2011)

Carbon offset registries (e.g., Chicago Climate Exchange, Climate Action Registry, Verified Carbon Standard and others) have established protocols for accounting, reporting and verification, as well. And, certain industries have developed tools to standardize GHG emissions reporting within their sector (e.g., American Petroleum Institute SANGEATM Emission Estimating System).

The above listed items have similarities and differences, with selected attributes discussed as follows:

Greenhouse Gases – All protocols address the typical GHGs, including CO2, CH4, N2O, SF6, HFCs and PFCs. Selected protocols may go beyond these basic gases, for instance PAS 2050 includes Montreal Protocol Compounds and additional compounds can be reported optionally under TCR.

Process vs. Inventory Calculation – A number of the protocols address both inventory development process and calculation. In contrast, the ISO standards focus specifically on inventory process. The Federal GHG Accounting and Reporting Guidance is accompanied by a Technical Support Document that addresses detailed Scope 1, 2, and 3 GHG inventory calculation methods. Additionally the WRI/WBCSD and TCR protocols provide over a dozen sector-specific protocols/toolkits.

Consolidation Approach – There are two basic approaches to how entities consolidate
their emissions, equity share, or operational control. Certain protocols/registries simply require that the approach be defined, although reporting on both bases often is encouraged. In contrast, Federal agencies conforming to EO 13514 must report GHG emissions associated with all activities that fall within their organizational boundaries.

Data Quality – This is addressed to varying degrees in all standards, protocols and guidelines (e.g., quality management systems, document retention/recordkeeping, inventory management plans). Data quality tiers are specifically designated in the TCR GRP.

De minimis–De minimis sources are treated differently among protocols. While certain protocols provide guidance and limitations for addressing such sources (e.g., WRI/WBCSD, TCR), others do not address de minimis emission sources. The MRR specifies industries and sources for which reporting is required, and the Federal guidance requires reporting of all GHG emissions.

Verification – Most, but not all, of these documents discuss verification requirements only in general terms. The ISO 14064-3 standard specifically addresses validation and verification of GHG assertions. To accompany the GRP, verification of GHG inventories submitted through TCR is governed by a detailed General Verification Protocol.

Case Examples

It would seem that there is sufficient guidance in the existing protocols to address most any GHG emission or carbon footprint calculation scenario. However, this is not always the case. Because there are underlying assumptions that will affect these calculations, there can be differences between protocols, and certain emission scenarios may not have methods that have been vetted and approved in the international community. Several examples are provided below.

Consolidation Method
Consider a scenario where a consumer chooses to make a purchasing decision based on a comparison between two companies’ carbon footprints, defined as their combined Scope 1 and Scope 2 GHG emissions. This example compares GHG emissions for BP and Royal Dutch- Shell based on publicly reported data from their respective 2010 Securities and Exchange Commission 20-F filings and sustainability reports. A summary of the comparative GHG emissions data is provided in Table 1:

Modeling Downwash_Table 3

On an absolute basis, BP’s GHG emissions are lower. When presented on an intensity basis, Royal Dutch- Shell’s GHG emissions are lower. However, there is not sufficient clarity regarding the basis on which these emission estimates were developed to use this data for decision-making. Specifically, each company reports its GHG emissions on a different consolidation basis; BP on equity share, Royal Dutch- Shell on operational control. Thus, to properly make this comparison, representation on a common basis and further analysis would be required.

Reporting of Sulfur Hexafluoride Emissions
Sulfur hexafluoride (SF6) is used in electrical transmission and distribution equipment as an insulating medium. Two methodologies that can be used to calculate fugitive SF6 emissions are the simplified methodology outlined in TCR EPS FG-03 (based on Energy Information Administration methodology) and a mass balance approach (i.e., by tracking inventory of SF6 over the reporting year) from EPA’s Mandatory Reporting Rule, 40 CFR 98 Subpart DD.

The TCR methodology calculation is based on the distance of transmission lines
multiplied by an emission factor:

  1. (1) SF6 Emissions (kg SF6) = 0.558 x
    Transmission Miles

    The mass balance approach (by tracking inventory of SF6 over the year) is as follows:

  2. User Emissions = (Decrease in SF6 Inventory) + (Acquisitions of SF6) – (Disbursements of SF6) – (Net Increase in Total Nameplate Capacity of Equipment Operated)

In one example, using equation (1), SF6 emissions are 3.5 metric tons (about 84,000 metric tons CO2-e), while using equation (2), SF6 emissions are 200 pounds (about 2,200 metric tons CO2-e). While the mass balance approach is the more accurate method, it requires appreciably more data to utilize. This example illustrates that the simplified TCR approach is overly conservative. Establishing procedures to collect the requisite data to perform a mass balance may be well worthwhile given the resulting magnitude of CO2-e emissions.

Transmission & Distribution Losses
Transmission and distribution (T&D) losses associated with electricity use are typically considered part of a consumer’s Scope 3 GHG emissions. However, an electric power generator or an entity that only transmits and markets electricity (e.g., Independent System Operator, Power Management Administration) would report these as Scope 2 emissions. Furthermore, consider a scenario where these entities only own and operate transmission lines and do not own or operate local power distribution systems.

If T&D loss related emissions are under consideration, only the scope of these emissions will differ. However, the TCR Electric Power Sector Protocol cites loss factors in the range of 0.5 to 3.5% for bulk transmission only. As illustrated in Table 2, GHG emissions from bulk transmission losses can be about 9 to 55% of that for T&D losses. The Federal GHG Accounting and Reporting Guidance does not specifically address this scenario for GHG reporting under EO 13514. This calculation can become more complex, as the TCR protocol provides guidance for instances where the transmission system owner has data for the specific sources of electricity (e.g., fossil or renewable) being carried by the transmission system.

Modeling Downwash_Table 4
Lifecycle GHG Emissions
There can be uncertainties and challenges when one attempts to extend GHG emissions inventories to a product or process lifecycle. Consider a scenario whereby conformance with the Federal Renewable Fuels Standard (RFS2, per the Energy Independence and Security Act of 2007) is required to generate additional quantities of renewable fuels. A project proponent petitions EPA to approve its corn-to-ethanol operation and the associated credits. The facility will be located in the U.S., with the emission reduction comparison being made with gasoline from crude petroleum. How would a project proponent perform a lifecycle assessment (LCA) of GHG emissions and estimate the requisite 20% reduction level as required by the standard?

Table 3 summarizes the results from such an analysis using two different LCA models. While the reductions compared to gasoline from crude petroleum both exceed 20%, the models pro- vide materially different results. And there are several qualifications provided in this particular study that can influence the outcome as follows:

Modeling Downwash_Table 5

  • Completeness of the LCA model data bases and underlying assumptions –
    Databases supporting LCA models are regularly updated, and may contain data that is not directly suitable for use in all applications (e.g., data predominantly from the EU for a US-based scenario).
  • Model variability – Models may have varying input data flexibility, sensitivity analysis capabilities, or limited fuel production pathways, affecting the ability or ease by which project specifics can be accommodated.
  • Farming practices and land use changes – These will influence the results, especially if they are not incorporated into the model. Feedstock production accounts for over 25% of the lifecycle GHG emissions in Table 3.
  • Co-product displacement of animal rations – Assumptions embedded in the models must be confirmed relative to the actual production scenario.
  • Assumptions – Power generation fuel mix, process energy requirements, and others can vary considerably. Consider that power generation fuel mix can be quite different depending on the region in which the proposed facility is located (e.g., whether generated predominantly by fossil fuels, nuclear, or hydro power).

Furthermore, the models used by the project proponent to develop a petition may not be the same as those utilized by EPA to evaluate it. EPA uses several models, including the Forest and Agricultural Sector Optimization Model (FASOM) and the Food and Agricultural Policy Research Institute (FAPRI) modeling system, among others. Thus, such analyses needs to carefully assess underlying assumptions and sensitivity of the model.


Accounting and reporting of GHG emissions is evolving from a voluntary to a statutory basis globally, with the U.S. and Canada most recently establishing requirements on the Federal and state/provincial levels. However, corporate and government sustainability considerations are driving interest in development and use of GHG emissions that extend beyond quantification of Scope 1 and 2 emissions. Quantification of Scope 3 GHG emissions and evaluation of supply chain and product lifecycle GHG emissions is becoming more commonplace, as evidenced by re-issuance of the PAS 2050 standard, issuance of the WRI/WBCSD Corporate Value Chain and Product Lifecycle Accounting and Reporting Standards, and ongoing development of a carbon footprint of products ISO standard.

Development of a GHG inventory is not necessarily a carbon footprint, per se, as they have different objectives and uses. When evaluating or verifying the results of such work, understanding the differences and assumptions is critical to setting and achieving assurance objectives.

For further information, please contact John Fillo, Principal Consultant, at (724) 996-1946 or