GHG inventory for Scope 1 and Scope 2

Four decisions come before any arithmetic: the reporting period, the organizational boundary, the gases in scope and the factor sources. Once those are written down, each emission source needs a quantity and a document behind it.

Customers that must report Scope 3 emissions will turn to their suppliers for this data, and California's SB 253 starts Scope 3 in 2027 on a schedule CARB is still writing. A supplier with a clean Scope 1 and Scope 2 inventory can answer those requests from one file instead of rebuilding the numbers for each.

The GHG Protocol Corporate Standard lets a company consolidate emissions by equity share or by control, and a company that picks control must choose between financial control and operational control. For a wholly owned company with no joint operations the boundary comes out the same whichever approach is used. It starts to matter with joint ventures, leased sites and partly owned subsidiaries.

Write the choice down and keep it for every year. Two practical rules save rework. First, match the boundary to whoever files: a parent that reports for its subsidiaries under SB 253 needs the same entity list in the inventory as in the consolidated filing, and each reporting entity's revenue and California sales are still tested separately. Second, if a customer questionnaire names a consolidation approach, use that one and say so in the methodology note rather than reworking the inventory later.

The quantities below are illustrative. The factors come from EPA's GHG Emission Factors Hub, 2025 edition (last modified January 15, 2025), which uses IPCC AR5 100-year GWPs of 28 for methane (CH4) and 265 for nitrous oxide (N2O).

Scope 1: natural gas in a boiler. Table 1 gives 53.06 kg CO2, 1.0 g CH4 and 0.10 g N2O per mmBtu.

Scope 2, location-based: grid electricity in California. Table 6 (eGRID2023) gives, for the WECC California subregion, 436.7 lb CO2, 0.025 lb CH4 and 0.003 lb N2O per MWh.

The same 1,000 MWh at the US average rate in that table (771.5 lb CO2, 0.057 lb CH4 and 0.008 lb N2O per MWh) comes to about 351.6 metric tons, so the subregion a site sits in changes the answer by more than a third. A real inventory repeats this for every fuel, site and month.

The GHG Protocol's Scope 2 Guidance (January 2015) says a company with operations in markets that offer product or supplier-specific data, in the form of contractual instruments, reports Scope 2 emissions in two ways and labels each result. This is called dual reporting.

• Location-based uses average emission factors for the grid where the electricity was used. The worked example above is a location-based figure.
• Market-based reflects the electricity the company chose, through supplier-specific rates, renewable energy certificates or power purchase agreements that meet the guidance's eight Scope 2 Quality Criteria, and uses a residual mix, where one exists, for electricity not covered by a contract.

Not having contractual data for every site does not make a company noncompliant with the Corporate Standard or the Scope 2 Guidance, and a company with operations only in markets without such data reports one result.

The rules are being rewritten. The GHG Protocol held public consultations on Scope 2 changes between October 20, 2025 and January 31, 2026. Its October 14, 2025 post describes a draft that would require hourly matching of certificates to consumption, from deliverable grid regions, and says all proposals remain subject to consultation. The post anticipates a revised Scope 2 Standard in late 2027. Until then the 2015 guidance is the published text.

EPA's GHG Emission Factors Hub is the usual starting point for US companies. Its 2025 edition (January 2025) updated purchased-electricity factors from eGRID and the factors for mobile combustion, transportation, business travel and commuting, and EPA's page, updated January 12, 2026, still lists it as the current edition. Two notes in the hub matter in practice. Annual non-baseload output rates should not be used for an inventory, and the grid gross loss percentages should not be applied to Scope 2 for an end user (they help with Scope 3, category 3).

Electricity is where the edition problem sits. The hub's Table 6 is built on eGRID2023. CARB's guidance of September 1, 2026 notes that EPA had not released eGRID 2024 on its usual timeline, and says filers may use eGRID 2023, the eGRID 2024 dataset published by the Cornerstone Sustainability Data Initiative, or another credible source, as long as they identify the one used.

Whatever the choice, the factor register records the dataset, edition, table and GWP vintage for every line. A customer or regulator can then see why a number moved when a new edition arrives, and a later GWP change (the hub uses AR5 today) does not look like an error.

The package is built for management's review and for an assurance provider's testing if one is ever engaged:

• An organizational boundary memo and the entity and site list.
• Activity data schedules by site and month, each line tied to an invoice, fleet report or meter read.
• A Scope 1 total, and a Scope 2 total on both methods where the company holds contractual instruments.
• A factor register with source, edition, table and GWP vintage.
• A methodology note covering estimates, exclusions and anything that changed since the last period.
• A reconciliation of fuel and utility spend in the general ledger to the activity data.

The same schedules feed the SB 253 report package and the ISSB and CSRD data requests that groups send to their US entities. Where the data has to come out of several systems on a schedule, finance data pipelines keep it from being rebuilt by hand each year, and the evidence folder follows the same layout as our working papers.