CBAM and Emission Scopes: What is Measured?

Scope 1, 2, 3: Fundamentals of Carbon Accounting and Focal Points of CBAM

When it comes to carbon footprinting, emissions are classified into three main categories: Scope 1, Scope 2 and Scope 3. This classification is set by the GHG (Greenhouse Gas) Protocol and is a fundamental building block for an organization to properly understand its environmental impact. But what exactly do these scopes mean and which of them does the Borderline Carbon Adjustment Mechanism (CBAM) take into account?

What are Scope 1, Scope 2 and Scope 3?

These three scopes determine the source of a company's emissions and the level of control:

Scope 1 (Scope 1): Direct Emissions
These are emissions from sources that a company directly controls in the course of its operations. They can be thought of as the "cardinal sins" of the company. This includes stationary combustion (boilers, furnaces), process emissions (chemical reactions during production) and mobile combustion (company vehicles).
Scope 2: Energy Indirect Emissions
These are indirect emissions that occur during the production of electricity, steam, heating or cooling that the company purchases and consumes.
Scope 3: Other Indirect Emissions
This is the broadest scope and includes all other indirect emissions that are outside the company's control but associated with the value chain. Many different categories fall under this heading, such as logistics (transportation), products purchased from suppliers (embedded emissions), use of products and waste management.

What Scopes Does CBAM Reporting Consider?

It is important to note that CBAM reporting, unlike corporate carbon footprinting, focuses specifically on the imported product. Therefore, CBAM does not consider all of these scopes, but only the specific sections that are directly or indirectly related to the product:

Scope 1 (Direct Emissions)
CBAM explicitly claims Scope 1. In particular, this includes fuel consumption in production, stationary combustion activities and industrial emissions during the process.
Scope 2 (Energy Indirect Emissions)
Emissions from purchased electricity consumed to produce the product are also a key part of CBAM calculations.
Scope 3 (Other Indirect Emissions)
CBAM does not consider all of Scope 3, but takes into account some critical subcategories. In particular, loads from the supplier (embedded emissions) and emissions related to some waste in the manufacturing process (such as Category 4.1 and 4.3) are important for reporting.

What are the Risks of Preparing a Report without Knowing the Scopes?

Trying to prepare a report without knowing what these scopes mean poses serious risks for companies:

Unnecessary Burden: By including sections that do not need to be reported (e.g. Scope 3 categories not covered by CBAM), there is a risk of declaring unnecessary and excess emissions.
Incomplete Reporting: More importantly, you may miss sections that CBAM clearly requires to be reported (such as Scope 1, 2 and some Scope 3 items).

How does CimpactPro solve this complexity?

So, does a user need to know all these technical scope distinctions by heart? If you use smart software like CimpactPro, the answer is no.

The software manages this complexity for you. The user does not need to define Scope 1, 2 or 3. CimpactPro simply asks you to enter your activity data (e.g. fuel consumption, electricity consumption, purchased raw material information, etc.). In the background, it automatically categorizes which Scope this data falls under and makes sure that it covers all mandatory fields required by CBAM.

The software does not allow you to miss, forget or skip any category in this process; it guides you step by step, eliminating the possibility of making mistakes. In this way, it enables you to prepare an accurate and complete report without getting bogged down in technical details.