Understand Scope 3 Category 11 emissions from the use of sold products and discover effective strategies to manage and reduce them. Enhance your ESG approach with this guide.

Explore the challenges of managing Scope 3 Category 11 emissions, which are generated during the use of your products by customers.

This comprehensive guide provides practical insights and strategies to help you minimise product-use emissions and strengthen your sustainability efforts. By addressing Category 11 emissions, you can significantly improve your ESG performance and demonstrate a firm commitment to environmental responsibility. Rely on ESG Pro for expert guidance and tailored solutions to drive impactful change in the environmental impact of your sold products.

end use of a company’s sold products by the final consumer. This category is particularly relevant for companies whose products consume energy or produce emissions during their usage phase, such as automobiles, appliances, electronics, and various types of machinery and equipment. These emissions can often represent a significant portion of the product’s total lifecycle emissions, depending on the nature and lifespan of the product.

2. Importance of Emissions from the Use of Sold Products

• Lifecycle Emissions Impact: For many products, the majority of GHG emissions over their lifecycle occur during the use phase, especially for energy-intensive products. Understanding these emissions is crucial for assessing the full environmental impact of a company’s products.
• Product Design and Innovation: Insights into the emissions from the use phase can drive innovation and improvements in product design, focusing on energy efficiency and reducing the carbon footprint of products.
• Consumer and Stakeholder Expectations: Consumers, investors, and regulators are increasingly interested in the sustainability of products throughout their entire lifecycle. Companies that can demonstrate a commitment to reducing emissions from the use of their products can enhance their reputation and market position.
• Regulatory Compliance and Reporting: Accurate accounting for and efforts to reduce Scope 3 emissions, including those from the use of sold products, are becoming more critical under global sustainability reporting standards and regulatory requirements.

3. Strategies for Reducing Emissions

• Energy-Efficient Design: Focus on designing and developing more energy-efficient products that consume less energy during use.
• Consumer Engagement: Educate consumers on sustainable usage practices and provide information on how to minimise emissions during the use of products.
• Innovation in Materials and Technology: Invest in research and development to find new materials and technologies that reduce the product’s energy consumption and emissions.
• Product Service Systems: Develop service models that encourage product sharing, leasing, or pooling to maximise product utilisation and reduce the need for energy-intensive production.

Addressing emissions from the use of sold products requires a comprehensive approach that encompasses product design, manufacturing processes, and consumer engagement. By focusing on reducing these emissions, companies can significantly contribute to global efforts to mitigate climate change while potentially gaining a competitive advantage in the market.

4. Example: Food Manufacturer

Imagine a company that produces and sells packaged food products, such as breakfast cereals. Here’s how Scope 3 emissions from the “Use of Sold Products” might apply:

1. Cooking and Preparation: When customers purchase breakfast cereals, they typically consume them by adding milk or yogurt, which may require energy for refrigeration or heating. The energy used for cooking or preparing meals contributes to emissions, especially if it comes from fossil fuel-based sources.
2. Food Waste: If consumers do not consume all the cereal they purchase and it goes to waste, it contributes to emissions indirectly. Food waste in landfills produces methane, a potent greenhouse gas, as it decomposes. Additionally, the production and transportation of food that ultimately goes to waste also generate emissions, contributing to the overall environmental impact.
3. Packaging Waste: The packaging of breakfast cereals, such as cardboard boxes and plastic bags, contributes to emissions throughout its lifecycle. If packaging materials are not recyclable or if consumers do not properly dispose of them, it can lead to emissions from landfilling or incineration.
4. Transportation and Distribution: While the transportation of goods typically falls under Scope 1 or Scope 2 emissions, the transportation of customers to and from stores to purchase food products indirectly contributes to emissions. This is because customers use vehicles powered by fossil fuels, resulting in emissions from transportation.

5. Calculating Use of Sold Products Emissions

Calculating Scope 3 emissions from the use of sold products involves estimating the greenhouse gas (GHG) emissions produced during the entire period that these products are used by the end consumer. This task can be particularly challenging due to the need to predict how products are used across diverse settings and over their lifetimes. However, a systematic approach can help in making these estimations. Here’s how to approach it:

Define the Product Scope

• Identify Products: Determine which of your company’s sold products consume energy or resources and emit GHGs during their use phase. This typically includes electronics, appliances, vehicles, and machinery.

Gather Product Usage Data

• Average Usage Patterns: Collect or estimate data on how these products are typically used by consumers, including operational hours per day, energy consumption rates (e.g., watts for electronics, litres per kilometre for vehicles), and expected lifespan.
• Energy or Resource Consumption: Determine the amount of energy or other resources (like fuel) the product consumes during its average use cycle.

Select Emission Factors

• Energy Emission Factors: Use appropriate emission factors for the type of energy or resources consumed by the product. These factors convert the amount of consumed energy or resources into equivalent CO2 emissions. Emission factors can vary based on the energy source (electricity, gasoline, natural gas, etc.) and geographical location, reflecting the local energy mix for electricity.

Calculate Emissions for Average Use

• Emission Estimations: Calculate the GHG emissions for an average unit of the product over its expected lifetime by applying the emission factors to the product’s energy or resource consumption data. This calculation will likely involve multiplying the daily or yearly consumption by the emission factor, then multiplying by the number of years in the product’s expected lifespan.

Aggregate Emissions for Sold Products

• Total Product Emissions: Multiply the average emissions per product unit by the total number of units sold during the reporting period to estimate the total Scope 3 emissions from the use of sold products.

Considerations for Accuracy

• Adjustments for Product Variants: Account for different models or variants of the product that might have different usage patterns or energy consumption rates.
• Geographical Variations: Consider regional differences in energy mix and usage patterns, as these can significantly affect the calculation of GHG emissions.
• Product Life Cycle Management: Keep track of changes in product design, energy efficiency improvements, and consumer usage patterns, as these can impact emissions over time.

Documentation and Continuous Improvement

• Maintain Records: Document your methodology, data sources, assumptions, and calculations. This documentation is essential for transparency, reporting, and identifying opportunities for improvement.
• Engage with Stakeholders: Work with consumers, suppliers, and industry groups to refine your estimates and develop strategies to reduce emissions from the use of sold products.

6. Conclusion

Mitigating Scope 3 emissions from the use of sold products demands a strategic focus on designing products that are energy-efficient and have a reduced environmental impact during their lifecycle. Companies taking this approach not only demonstrate a commitment to sustainability but also influence consumer behaviour towards greener alternatives. This effort contributes significantly to the reduction of global greenhouse gas emissions, aligns with consumer expectations for sustainable products, and strengthens a company’s competitive advantage in the market. By prioritising eco-friendly design and promoting sustainable usage practices, organisations can lead by example, showcasing their dedication to a sustainable future and fostering a culture of environmental responsibility among consumers and within the industry.

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