# Definitions & Terminology

## What Are Greenhouse Gas (GHG) Emissions?

Greenhouse Gas (GHG) emissions are gases released into the atmosphere that trap heat and contribute to climate change. These emissions are produced when companies carry out everyday activities: such as burning fuel for energy, running industrial processes, or transporting goods. When companies talk about their “GHG emissions,” they are referring to the amount of these gases generated by their operations or value chain.

Tracenable follows the **Greenhouse Gas Protocol (GHG Protocol)**, the global standard for measuring and reporting these emissions. It requires companies to account for seven gases as defined in the Kyoto Protocol:

* Carbon dioxide (CO₂)
* Methane (CH₄)
* Nitrous oxide (N₂O)
* Hydrofluorocarbons (HFCs)
* Perfluorocarbons (PFCs)
* Sulfur hexafluoride (SF₆)
* Nitrogen trifluoride (NF₃)

#### <mark style="color:$info;">What’s Not Included in GHG Emissions</mark>

To stay aligned with the GHG Protocol, Tracenable’s dataset excludes:

* **Biogenic CO₂ emissions** – These are reported separately and not counted in Scope 1 totals. (Biogenic CH₄ and N₂O, however, remain part of Scope 1 process emissions.)
* **Air pollutants** – Gases such as NOₓ, SOₓ, CO, particulate matter (PM), and volatile organic compounds (VOCs). These affect local air quality and health but are not greenhouse gases and are tracked under different reporting frameworks.

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In short: GHG data covers only gases with global warming potential, as defined by international climate agreements and operationalized by the GHG Protocol. Tracenable’s dataset strictly follows this scope for comparability and global alignment.
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## Scopes of Emissions

The GHG Protocol classifies emissions into **three scopes** based on where they occur in relation to company operations. Think of them as three “boundaries” that help identify what a company is responsible for.

### <mark style="color:$success;">Scope 1 – Direct Emissions</mark>

Emissions from **sources that a company owns or directly controls**, including:

#### <mark style="color:$info;">**Stationary Combustion**</mark>&#x20;

* Emissions from burning fuels in on-site equipment, such as boilers, furnaces, or generators.
* *Example: A manufacturing plant burning natural gas in industrial furnaces.*

#### <mark style="color:$info;">**Process Emissions**</mark>&#x20;

* Emissions from chemical or physical processes that are not related to fuel combustion.
* *Example: A cement company reporting CO₂ emissions from clinker production.*

#### <mark style="color:$info;">**Mobile Combustion**</mark>

* Emissions from fuel burned in company-owned vehicles or mobile equipment, such as trucks, ships, or aircraft.
* *Example: A logistics company reporting diesel use from its delivery truck fleet.*

#### <mark style="color:$info;">**Direct Releases**</mark>

Gases released intentionally or unintentionally into the atmosphere. This includes:

* <mark style="color:$info;">**Fugitive emissions**</mark> (e.g., leaks from pipelines, tanks, or wells)
* <mark style="color:$info;">**Refrigerant emissions**</mark> (e.g., leakage from air conditioning and refrigeration units)
* <mark style="color:$info;">**Venting emissions**</mark> (e.g., direct release of natural gas during oil extraction)
* <mark style="color:$info;">**Flaring emissions**</mark> (e.g., burning of natural gas during oil production)

### <mark style="color:$success;">Scope 2 – Indirect Energy Emissions</mark>

Emissions from the generation of **purchased or acquired energy** consumed by the company including electricity, heat, steam, and cooling.

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These occur at the energy provider’s facilities but are attributed to the company because of its energy use.
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#### <mark style="color:$info;">**Electricity**</mark>

* Emissions from purchased electricity used to run buildings, facilities, and equipment.
* *Example: An office sourcing power from a grid that relies on fossil fuels.*

#### <mark style="color:$info;">**Heat**</mark>

* Emissions from purchased heat for industrial processes or building climate control.&#x20;
* *Example: A commercial building using district heating supplied by an external provider.*

#### <mark style="color:$info;">**Steam**</mark>

* Emissions from purchased steam used in production or heating.
* *Example: A paper mill purchasing steam for its manufacturing process.*

#### <mark style="color:$info;">**Cooling**</mark>

* Emissions from purchased chilled water or cooled air supplied by third-party providers.&#x20;
* *Example: A data center relying on external cooling services.*

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#### **The GHG Protocol requires reporting of Scope 2 emissions under two methods:**

* **Location-based method**: Reflects the average emissions intensity of the grid where the energy is consumed. It uses published grid emission factors and does not account for specific energy purchasing decisions. \
  \&#xNAN;*Purpose:* Shows the environmental impact based on the regional energy mix (e.g., fossil-heavy vs. renewable-heavy grids).
* **Market-based method**: Reflects emissions based on specific contractual arrangements or instruments — such as renewable energy certificates (RECs), power purchase agreements (PPAs), or supplier-specific emissions factors. \
  \&#xNAN;*Purpose:* Allows companies to demonstrate their choice to purchase lower-emission electricity or participate in green energy programs.
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Tracenable captures and distinguishes both values (when disclosed), ensuring consistency with GHG Protocol requirements.
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### <mark style="color:$success;">Scope 3 – Other Indirect (Value Chain) Emissions</mark>

All other indirect emissions across the value chain, often the largest part of a company’s footprint. It includes:

#### <mark style="color:$info;">**Upstream Scope 3 Emissions**</mark>

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Emissions generated **before a company’s operations**, linked to the production and delivery of inputs it relies on.
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* <mark style="color:$info;">**Purchased goods and services**</mark> - emissions from producing raw materials or services a company buys.
* <mark style="color:$info;">**Capital goods**</mark> - emissions from manufacturing long-term assets like buildings, vehicles, or machinery.
* <mark style="color:$info;">**Fuel and energy-related activities**</mark> - emissions from fuel supply chains, not already counted in Scope 1 or 2.
* <mark style="color:$info;">**Transportation and distribution (upstream)**</mark> - emissions from moving inputs to the company.
* <mark style="color:$info;">**Waste generated in operations**</mark> - emissions from treatment and disposal of waste from company facilities.
* <mark style="color:$info;">**Business travel**</mark> - emissions from employee flights, trains, and other work-related travel.
* <mark style="color:$info;">**Employee commuting**</mark> - emissions from daily transport between employees’ homes and workplaces.
* <mark style="color:$info;">**Leased assets (upstream)**</mark> - emissions from assets used but not owned by the company.

#### <mark style="color:$info;">**Downstream Scope 3 Emissions**</mark>

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Emissions generated **after a company’s operations**, linked to how its products and services are distributed, used, and disposed of.
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* <mark style="color:$info;">**Transportation and distribution (downstream)**</mark> - emissions from moving products to customers.
* <mark style="color:$info;">**Processing of sold products**</mark> - emissions from customers transforming sold products into other goods.
* <mark style="color:$info;">**Use of sold products**</mark> - emissions from consumers using the company’s products (e.g., fuel use in cars).
* <mark style="color:$info;">**End-of-life treatment of sold products**</mark> - emissions from disposal, recycling, or waste treatment after use.
* <mark style="color:$info;">**Leased assets (downstream)**</mark> - emissions from assets owned by the company but leased to others.
* <mark style="color:$info;">**Franchises**</mark> - emissions from operations of franchisees not directly controlled by the company.
* <mark style="color:$info;">**Investments**</mark> - emissions associated with investments in other businesses.

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