What does Scope 3 emissions encompass?

Scope 3 emissions refer to all indirect greenhouse gas emissions that occur in a company’s value chain, which are not directly controlled by the company itself. This includes emissions resulting from activities such as the extraction and production of the materials purchased by the company, transportation of those materials, product use, product disposal, and other upstream and downstream activities.

Understanding Scope 3 emissions is crucial for organizations to comprehensively assess their overall carbon footprint, as it often accounts for the majority of total emissions. Many companies are increasingly focusing on Scope 3 because it reflects their broader environmental impact and is necessary for improving sustainability efforts and implementing effective carbon reduction strategies across their entire value chain.

The other choices provided are specific types of emissions that fall under different scopes. Direct emissions from power plants and manufacturing processes are typically categorized as Scope 1 emissions because they are produced from sources that the company owns or controls. Indirect emissions from purchased electricity are classified as Scope 2 emissions, which are related to the electricity a company's operations require but are generated off-site. By distinguishing these categories, organizations can prioritize their emissions reduction strategies more effectively.