Scope 2 emissions are indirect greenhouse gases that your organisation produces as a result of the electricity, steam, heat and cooling that it purchases. Basically emissions are often released in the generation of electricity, where fossil fuels are used to generate electricity the emissions intensity of that electricity is generally higher. Although Scope 2 emissions are not under the direct control of the organisation, often it will have significant influence over both how much electricity is consumed aswell where that electricity comes from. This means that this is often a key focus for reduction opportunities.

You can learn more about scope 2 emissions in our detailed article here.

Reducing emissions isn't just about saving the planet—it’s also about cutting costs, improving efficiency, and staying ahead of regulations. Start by accurately measuring your current emissions through comprehensive data collection and reporting. With a clear understanding of your emissions profile, you can identify reduction opportunities and implement your strategies. Let’s dive into common methods for reducing Scope 2 emissions and learn how to prioritise these initiatives effectively.

There are two drivers of Scope 2 emissions:

Any reduction opportunity will decrease one or both of these driver and some the the reduction opportunities are outlined below.

The types of Scope 2 reduction opportunities will vary from business to business. By preparing a GHG Inventory you will start to understand where your Scope 2 emissions are coming from which will then inform the possible opportunities that might be available

Not all emission reduction opportunities are created equal. Here’s how to prioritise them:

Look at how much each opportunity can cut your emissions. Focus on the ones with the biggest impact relative to their cost and feasibility.

Evaluate the cost-effectiveness of each initiative, considering the initial investment, operational costs, and potential savings. Go for the options that give you the best bang for your buck.

Consider how practical each opportunity is to implement, including technical, regulatory, and logistical factors. Prioritise solutions that can grow with your organization.

Make sure your emission reduction efforts align with your broader strategic goals, such as sustainability targets, financial performance, and corporate social responsibility commitments.

Engage with stakeholders like employees, customers, investors, and regulators. Projects with strong stakeholder backing are more likely to succeed.

Once you have evaluated the opportunities across each of these dimensions you can then compare them to identify which ones make sense to prioritise. There are many frameworks that can be used to make this decision - your organisation might even have its own guidance.

At Sumday we find the Value vs Effort Matrix as helpful. Basically you want to look at the cost and effort associated with each of the initiatives as well as the potential value in terms of carbon reduction.

To help with further prioritising potential initiatives, tools like Marginal Abatement Cost Curves (MACC) can be useful. The idea with a MACC is to understand the relative cost of reducing greenhouse gas emissions by one tonne across all of the initiatives that a business has available to reduce emissions. From there you can visualise the relative financial impact of each of these reduction opportunities on a continuum.

Projects with a Marginal Abatement Cost of below $0/t of CO2e should deliver a financial saving as a result of implementing the project. Cost is obviously just one consideration and the other factors like those outlined above should also be considered as part of the investment process.

Scope 2 is one of the key areas where businesses can make significant reductions in the short to medium term. Often energy efficiency initiatives generate cost savings meaning they are a great quick win on emissions reduction. In addition transitioning to procuring renewable electricity can have a large impact and be relatively simple to implement.

In developing and executing on a reduction strategy it is important to consider emission reduction potential, cost-effectiveness, feasibility, alignment with organisational goals, and stakeholder support. In considering these factors Scope 2 opportunities will likely play a key role on your businesses decarbonisation journey.