Scope 3 Purchased Goods Emissions Accounting
The University of Michigan’s GHG emissions can be broken into three categories: Scope 1 (those generated on-site), Scope 2 (those associated with purchased electricity); and Scope 3 (those resulting from ancillary, indirect activities such as commuting, purchasing, travel, waste, etc.). The President’s Commission on Carbon Neutrality (PCCN) has developed baselines and GHG reduction trajectories for Scope 1 and 2 emissions, as well as several Scope 3 emission categories including travel, commuting and purchased food. Purchased goods Scope 3 emissions have not been accurately inventoried and greenhouse gas footprint data from suppliers are very limited. The Procurement Services office at the University of Michigan reports that the university’s yearly purchases of goods amount to approximately $2.5 billion. The emissions embodied in goods and service are expected to contribute a large portion of the university’s total carbon footprint.
Project Objective: Develop an accounting system and methods to evaluate Scope 3 emissions from purchased goods and services.
The accounting system will integrate the university’s purchasing data with an environmentally extended input-output (EEIO) model to estimate Scope 3 emissions by sectoral
spending. Input-output models are used to analyze the proportion of sectoral material, or ‘inputs’, that contribute to the overall production, or ‘output’, of goods among other sectors. EEIOs are made possible through the integration of environmental and economic data to assign burdens to the supply chain of any given product or process on a per-dollar basis.
The results of this model will 1) serve to characterize purchased goods emissions and to support the University in establishing carbon reduction goals; 2) identify high-impact sectors, which procurement services can target for reducing emissions; and 3) separate purchased goods and service emissions from other emissions that have already been inventoried by the PCCN Carbon Accounting subgroup. The inclusion of Scope 3 emissions will provide the university more comprehensive accounting of its carbon footprint on its pathway to achieving carbon neutrality. This study will also guide other institutions and businesses in measuring and reducing their carbon footprints from purchased goods and services.