Decarbonisation - A Deep Dive into Scope 3, Category 2 (Capital Goods)
Blog summary
Category 2 includes all upstream emissions associated with the production of purchased or acquired capital goods.
Refresher on Category 2
Category 2 focuses on all upstream (i.e., cradle-to-gate) emissions associated to the entire life cycle of products purchased by the reporting company, including both goods (tangible products) and services (intangible products).
As defined by the GHG Protocol, capital goods are often those treated as fixed assets or as plant, property or equipment (PP&E).
These emissions often make up a significant proportion of an organisations carbon footprint for those in sectors such as Energy, Transportation, and semi-conductors.
Managing and Reducing Category 2 Emissions:
Supplier Engagement and Collaboration:
One of the primary steps toward reducing emissions from capital goods is fostering supplier engagement and collaboration.
Procurement and Policy Choices
Another crucial aspect of emission reduction (regarding capital goods) is the consideration of procurement and policy choices. By opting and prioritising sustainable purchasing decisions and policies, businesses can improve their footprint. For example, opting for materials with lower carbon footprints, selecting energy-efficient machinery, and supporting suppliers who adhere to environmentally responsible practices can help reduce a businesses total carbon emissions profile.
Product Design and Longevity
One final means to manage capital goods emissions lies in opting for goods that are designed with longevity in mind. This reduces the need to buy more goods than necessary due to them having higher durability.