Scope 1, 2 and 3 Emissions: Carbon Footprint Explained

Scope 1, Scope 2 and Scope 3 carbon emissions explained using a hotel example

Imagine managing a hotel in Nigeria. Every month, you review two familiar bills: diesel for the generator and electricity purchased from the grid. They tell you something important about the hotel’s energy use, but do they tell you its entire carbon story?

Not quite. Food has been grown and transported before it reaches the kitchen. Bed linen may be washed by an external laundry. Staff travel to work, and the hotel’s waste must be treated or disposed of. These activities can also generate greenhouse gas emissions, even when they do not come directly from the hotel’s own equipment.

This is where carbon footprint measurement becomes more useful than simply checking fuel and electricity bills. The Greenhouse Gas Protocol (GHG Protocol) groups organisational emissions into three categories: Scope 1, Scope 2 and Scope 3. Understanding the difference helps organisations build a clearer emissions inventory and identify where reductions may be possible.

This Sustainability Monday article builds on our discussion of Nigeria’s Net Zero 2060: How Far Has Nigeria Come? and explains the concepts using a Nigerian hotel as a running example.

What is a carbon footprint?

An organisation’s carbon footprint is an estimate of the greenhouse gases associated with its activities over a defined period, often a year. The process of identifying, calculating and reporting these emissions is known as greenhouse gas accounting.

Different greenhouse gases have different warming effects. To compare and combine them, results are commonly expressed as carbon dioxide equivalent (CO₂e). It converts gases such as methane and nitrous oxide into a common unit based on their warming effect over a specified time horizon.

A reliable baseline helps an organisation identify important sources, set priorities, track changes and assess whether reduction measures are working. Measurement alone does not reduce emissions, but it can help an organisation decide where to act.

The GHG Protocol, developed by the World Resources Institute and the World Business Council for Sustainable Development, provides widely used standards and guidance for organisational greenhouse gas accounting. In simple terms, the three scopes distinguish direct emissions from sources an organisation controls, emissions associated with energy it purchases, and other indirect emissions across its value chain.

Scope 1 emissions: direct emissions

Scope 1 covers direct greenhouse gas emissions from sources owned or controlled by the organisation. For a hotel or similar business, examples may include:

diesel or petrol burned in its own generators;
fuel used by vehicles it owns or controls;
gas burned in their own kitchen equipment or boilers; and
refrigerant leaks from air-conditioning systems or the cold rooms it controls.

Some refrigerants have a high global-warming impact, so leaks from cooling equipment can contribute to an organisation’s footprint. Maintenance and refrigerant top-up records can therefore be useful sources of activity data.

Scope 2 emissions: purchased energy

Scope 2 covers emissions associated with the generation of purchased or acquired electricity, steam, heating and cooling that the organisation consumes. These emissions usually occur where the energy is generated rather than inside the organisation’s building.

Consider a Nigerian hotel that buys electricity from the grid but also operates a diesel generator when grid supply is unavailable:

Fuel burned in the hotel’s own generators: Scope 1, because the hotel’s equipment directly releases the emissions.
Electricity purchased from the grid: Scope 2, because the emissions are associated with generating the electricity the hotel consumes.

Keeping these sources separate helps managers understand the contribution of on-site fuel use compared with purchased electricity. It also helps them consider different responses, such as generator maintenance, energy efficiency, improved load management or cleaner electricity options where feasible.

The GHG Protocol’s published Scope 2 Guidance describes location-based and market-based accounting methods. Their applicability depends on the relevant market and available contractual and energy-supply information. Organisations should consult the official guidance and check for updates before deciding which methods and reporting requirements apply.

Scope 3 emissions: the wider value chain

Scope 3 includes other indirect emissions that occur across an organisation’s upstream and downstream value chain. These emissions arise from activities connected to the organisation but occur at sources it does not own or control. The GHG Protocol’s Scope 3 Standard groups these activities into 15 categories.

Depending on the organisation and its activities, examples of a hotel may include:

Purchased food, drinks and supplies: emissions may arise during production, processing and transport before items reach the hotel.
Outsourced laundry: emissions associated with a third-party laundry service may fall within the hotel’s value-chain inventory.
Business travel: travel undertaken for the organisation can generate indirect emissions.
Waste generated in operations: emissions may arise from treatment or disposal.
Fuel- and energy-related activities: Some upstream emissions associated with producing and transporting fuels and energy are reported outside Scopes 1 and 2.

The correct classification depends on the activity, the organisation’s reporting boundary and the applicable accounting rules. Laundry performed by a third-party provider is different from laundry carried out in equipment the hotel owns or controls. Organisations should document their decisions rather than assume every example belongs in the same category in every circumstance.

Scope 1, Scope 2 and Scope 3 compared

Scope	What it covers	Hotel examples	A useful question
Scope 1	Direct emissions from sources owned or controlled.	Generator fuel, controlled vehicles, kitchen gas, refrigerant leaks.	What do we burn or release directly?
Scope 2	Emissions associated with generating purchased or acquired energy consumed.	Purchased grid electricity and other qualifying purchased energy.	What energy do we purchase and consume?
Scope 3	Other indirect emissions across the value chain.	Purchased food and supplies, outsourced services, business travel and waste treatment.	What emissions occur elsewhere because of our activities?

Putting the three scopes together: a Nigerian hotel

A hotel estimating its annual greenhouse gas emissions could organise available records like this:

Scope 1: fuel used in generators and controlled vehicles, gas burned in equipment, and refrigerant servicing or replacement.
Scope 2: Electricity bills and records of other purchased energy covered by the applicable accounting rules.
Scope 3: information about significant purchases, outsourced laundry, business travel, waste treatment and relevant upstream activities.

If management counts only generator fuel, it has captured part of Scope 1, but not the whole footprint. Adding purchased electricity gives a clearer picture of energy-related emissions, but it still does not account for all relevant value-chain activities. The size and significance of Scope 3 emissions must be established from the hotel’s own activities and data rather than assumed.

A carbon footprint is therefore more than a single fuel total. It is an inventory built from defined boundaries, activity data, suitable emission factors, documented assumptions and consistent calculation methods.

Why does the distinction matter?

Better measurement: separating the scopes helps organisations identify sources systematically and reduce the risk of omissions or double counting.
More targeted actions: Scope 1 reductions may involve fuel efficiency, equipment maintenance or fuel changes. Scope 2 strategies may include energy efficiency and feasible cleaner-energy options. Scope 3 reductions often require collaboration with suppliers and other value-chain partners.
Transparent reporting: clear boundaries and methods help readers understand what was included, excluded and why.
Progress tracking: consistent methods make it easier to assess changes in an organisation’s inventory over time.
Net-zero planning: a baseline gives an organisation a starting point for setting priorities and monitoring progress towards targets.

Reliable activity data is essential. Examples include litres of fuel, kilowatt-hours of electricity, refrigerant records, quantities of purchased goods and waste data. Organisations should document the boundaries and assumptions behind their calculations. A footprint is an estimate, and its quality depends on the information and methods used.

Four common misconceptions about emissions scopes

Misconception 1: “Scope 2 is just Scope 1 under another name.”

No. Scope 1 covers direct emissions from owned or controlled sources. Scope 2 covers emissions associated with generating purchased or acquired energy consumed by the organisation. They describe different sources and may require different reduction measures.

Misconception 2: “Scope 3 does not matter because it happens outside our premises.”

Location alone does not determine importance. Emissions associated with purchased goods, outsourced services and other value-chain activities may be relevant to an organisation’s overall impact and reduction opportunities.

Misconception 3: “Every organisation has the same Scope 3 sources.”

The 15 categories provide a framework, but the activities and their significance differ. A hotel, a bank and a manufacturing company will not necessarily have the same emissions profile.

Misconception 4: “Once we have a carbon footprint figure, we have the complete picture.”

Not necessarily. Results depend on the reporting boundary, data quality, assumptions and calculation methods. A responsible inventory explains these limitations and improves as better data become available.

How Nigerian organisations can get started

Define the reporting boundary. Identify the operations, sites and assets included in the inventory, and document the approach used.
List direct emission sources. Identify generators, vehicles, cooking fuels, boilers and cooling equipment under the organisation’s control.
Gather energy records. Collect fuel records and electricity bills, and retain relevant maintenance and refrigerant records.
Map the value chain. Identify significant purchases, outsourced services, travel and waste-related activities.
Record assumptions and gaps. State where estimates are used and why, rather than presenting uncertain figures as exact measurements.
Improve the inventory over time. Strengthen data collection, use appropriate emission factors and refine calculations as better information becomes available.

For hotels, this can support practical operational questions: where is fuel being consumed, which energy uses could be made more efficient, what information can suppliers provide, and which activities deserve closer investigation? The answers should come from the evidence collected, not from assumptions about which scope must be largest.

Conclusion: measurement is the starting point

Scope 1, Scope 2 and Scope 3 provide different but connected views of an organisation’s greenhouse gas emissions. Scope 1 covers direct emissions from sources it owns or controls. Scope 2 covers emissions associated with purchased or acquired energy it consumes. Scope 3 covers other indirect emissions across its value chain.

For Nigerian organisations, understanding these categories can help turn broad climate commitments into a more systematic process of measurement, planning and reporting. Nigeria’s net-zero ambition for 2060 makes credible progress tracking important, but measuring emissions is only the beginning: organisations must use what they learn to identify and implement meaningful reductions.

In our next Sustainability Monday article, we will explore carbon intensity what it means, how it is measured and why it can help interpret emissions alongside the scale of an organisation’s activities.

Over to you

Which emissions scope do you think would be hardest for a Nigerian business to measure and why? Share your perspective in the comments.

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