Oomph Works Wonders for calculating Scope 3 Emissions

One of the biggest barriers for businesses today is calculating scope 3 emissions when considering overall environmental impact. Not to be taken lightly, it’s estimated that scope 3 greenhouse gas (GHG) emissions account for approximately 80-95% of the total value chain of an organisation’s carbon footprint¹. In the food and drink sector alone, NGO WRAP reports that scope 3 emissions are roughly 90% of its carbon footprint², while in other manufacturing sectors it averages 70%³. But the real question is why is scope 3 so difficult to calculate? 

The difference between Scope 1, 2 and 3

The GHG Protocol officially classifies scope 1 as direct emissions from owned or controlled sources, scope 2 as indirect emissions from the generation of purchased energy, and scope 3 as all indirect emissions (excluding scope 2) that occur in the upstream or downstream of the value chain. The challenge with scope 3 is that there is no easy way to capture, calculate or report on all emissions in a company’s supply chain, without significant investment in time, money and software reporting tools. 

While larger organisations are required to report their scope 1 and 2 emissions in line with the SECR (Streamlined Energy and Carbon Reporting) Framework via their annual reports, scope 3 is currently supplied voluntarily only. However, this could change. In May 2023, the UK government launched a ‘Call for Evidence’ to understand organisations’ views on the costs, benefits and practicalities of scope 3 emissions reporting. The second review period only ended in December 2023, with the results due to be published soon. It is believed that at the end of the consultation period, the UK government will launch an endorsed version of the IFRS Sustainability Standards S2, designed to support businesses that want to voluntarily report their scope 3 emissions. 

New obligations for businesses to report on their scope 3 emissions could be enforced as early as 2025. Even now, organisations that bid for a government contract over £5 million are required to report on their scope 3 emissions⁴. 

To scope or not to scope 

Many businesses may feel overwhelmed at the prospect of undertaking such a behemoth task – and that’s only natural. However, the GHG Protocol has released a new companion guide, so that companies can more easily find their way to the needle in the haystack. 

GHG Protocol and the Carbon Trust have together outlined the following scope 3 emissions⁵:

Upstream Emissions 

• Purchased good and services 

• Capital goods 

• Fuel and energy related activities 

• Upstream transportation and distribution 

• Waste generation in operations 

• Business travel 

• Employee commuting 

• Upstream leased assets 

Downstream Emissions 

• Downstream transport and distribution 

• Processing of sold products 

• Use of sold products 

• End-of-life treatment of sold products 

• Downstream leased assets 

• Franchises Investments

The Carbon Trust has also delivered advice for businesses too, including specific pointers like building out the most important areas first, before tackling other areas⁶. Unfortunately, for many businesses, they are still relying on manual calculations of emissions⁷. This is more than likely due to a lack of investment in digitalisation and the know-how to initiate such a project.  

Where Oomph Works can support

Oomph Works, an ACI Group company, has developed a software tool that will enable organisations to evaluate their scope 3 emissions. Powered by Supply Chain Manager (SCM) software, the tool will calculate both upstream and downstream emissions to enable businesses to easily visualise and understand their data. 

The software has been launched as part of ACI Group’s new customer portal located right here on our website. When customers and suppliers input their supply chain information into the portal, they will be able to track all orders from initial production to the final end product – whether that’s at consumer or manufacturer level. The idea is that customers and suppliers obtain full visibility of their commercial operations. 

Currently, the software orchestrates the collection and tracking of materials and supplies. However, in the future, SCM will use Artificial Intelligence (AI) to predict, adapt and respond to challenges facing the supply chain. For instance, should a customer’s goods get stuck in the Suez Canal, in the Red Sea, or even through more recent accidental tragedies like the Baltimore bridge collapse, the software would be able to find alternative routes, calculate the cost of those routes, and determine the environmental impact, so that the customer can make an informed business decision, rather than a potentially risky one.

If you’re a customer or supplier with ACI Group, make sure to log in to your portal and trial the new features. We’re always happy to receive feedback or provide you with more information, so contact our team today for assistance. 

References:
1. New Climate, Corporate Climate Responsibility, 2022. https://newclimate.org/resources/publications/corporate-climate-responsibility-monitor-2022 

2. NGO Wrap via British Baker, ‘Sustainability Matters: How bakeries can deal with scope 3 emissions, February 2024. https://bakeryinfo.co.uk/ingredients-reports/sustainability-matters-how-bakeries-can-deal-with-scope-3-emissions/

3. Scottish Food & Drink Partnership via British Baker, ‘Sustainability Matters: How bakeries can deal with scope 3 emissions, February 2024. https://bakeryinfo.co.uk/ingredients-reports/sustainability-matters-how-bakeries-can-deal-with-scope-3-emissions/

4. Department for Energy Security & Net Zero, Scope 3 Emissions in the UK Reporting Landscape: Call for Evidence, 2023.
5. GHG Protocol, Scope 3 Calculation Guidance, 2023. https://ghgprotocol.org/scope-3-calculation-guidance-2

6. Carbon Trust, Make business sense of scope 3, 2013. https://www.carbontrust.com/news-and-insights/insights/make-business-sense-of-scope-3

7. British Baker, ‘Sustainability Matters: How bakeries can deal with scope 3 emissions, February 2024. https://bakeryinfo.co.uk/ingredients-reports/sustainability-matters-how-bakeries-can-deal-with-scope-3-emissions/