Strategic CSR - Scope 4 emissions

The article in the url below caught my attention due to its focus on scope 4 greenhouse gas emissions – a term that the author saw used recently by PG&E. I was familiar with scope 1, 2, and 3, but had not heard scope 4 before:

"Scope 1 and 2 were rigorously defined back in 2001 under the Greenhouse Gas Protocol, the established resource for emissions accounting developed by the World Resources Institute and the World Business Council for Sustainable Development. Scope 3, the most complicated one, came in 2011. The trio of terms was designed to capture the full sweep of a company's climate footprint, according to WRI climate expert Pankaj Bhatia. This includes the direct emissions tied to a company's activities (Scope 1), as well as the indirect emissions from a company's energy use linked to making its product or delivering its services (Scope 2). It even includes pretty much any other indirect source of emissions associated with a company's value chain (Scope 3)."

So, is scope 4 a real thing or did PG&E make it up?

 

"Bhatia provided a decisive answer to the second question: No, officially they are not an established category under the Greenhouse Gas Protocol. And Bhatia would know because he's the program's director and has been tracking these conversations for decades. The fact that PG&E recently used this terminology was news to Bhatia and others interviewed for this article."

 

It seems that PG&E is using the term in order to convey positive progress, rather than simply cataloging all the negative emissions for which the firm is responsible: 

 

"PG&E doesn't dispute the term's unofficial nature. Spokesperson Lynsey Paulo wrote in an email that in the recent report, 'we acknowledge that 'Scope 4' is 'an emerging term for categorizing emission reductions enabled by a company' and present the term in quotations to distinguish it from Scope 1, 2, and 3 greenhouse gas emissions.' She went on: 'As a utility that provides gas and electric service to millions of Californians, we have dedicated programs and strategies to enable our customers to reduce their carbon footprint and our 'Scope 4' goals quantify our 2030 objectives.' For example, by providing energy efficiency and electrification programs, the company said they can help customers save 48 million metric tons of carbon-dioxide equivalent by 2030. And by promoting and supporting the uptake of electric vehicles in the utility's service area across California, the utility said it can save customers more than 58 million metric tons of CO₂ equivalent by the decade's end."

 

So, in essence:

 

"PG&E seems to be using 'Scope 4' as synonymous with what others more commonly refer to as 'avoided emissions,' said Laura Draucker, Ceres' director of corporate greenhouse gas emissions. This isn't the first time this has happened, but it's not common or widely accepted."

While this may be fine, due to the ambiguous nature of this term (which has not been officially defined) and the temptation firms have to emphasize positive over negative news, the potential is for 'scope 4 emissions' to be used as greenwash:

"To be sure, PG&E is tackling its greenhouse gas footprint. In the report, the company outlined its target to be a net-zero energy system in 2040, five years ahead of California's similar climate goal. The company has also pledged to cut its Scope 1 and 2 goals by 50 percent from 2015 levels by the end of the decade, and to cut Scope 3 emissions by 25 percent from 2015 levels in that same time period. Still, the report didn't offer a formula or detailed data behind PG&E's 'Scope 4' figures, making it hard to understand what's fully counted as avoided emissions or how to compare that to any other companies that may follow its lead. If companies do follow PG&E, Bhatia advises that they don't adopt the 'Scope 4' label and find something else instead."

Take care

David

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (6e)

© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

PG&E Wants to Add 'Scope 4' Emissions to Your Climate Dictionary

By Zahara Hirji

June 19, 2022

Bloomberg Businessweek

https://www.bloomberg.com/news/articles/2022-06-20/what-are-scope-1-2-and-3-emissions-not-enough-for-utility-pg-e