Greenhouse Gas Emissions Calculation

HPBS calculates the greenhouse gas emissions and carbon footprint of organizations, assets, investment portfolios and products in accordance with international standards.

We regard emissions inventories as the foundation for managing climate risks, decarbonization, ESG reporting, attracting international financing and preparing businesses for climate regulation and carbon-market requirements.

We use GHG Protocol and ISO 14064 methodologies, industry standards and specialized approaches, including PCAF for calculating the financed emissions of financial institutions.

HPBS’s experience includes projects to calculate corporate emissions and develop MRV systems for banks and financial institutions, the oil and gas sector, industry, transport, logistics and state-owned companies, as well as product carbon-footprint calculations and preparation of enterprises for CBAM requirements.

What is included in Scope 1, Scope 2 and Scope 3 calculations

Scope 1 — direct emissions

We calculate emissions from sources owned or operationally controlled by the company. Depending on the industry, we analyze:

stationary fuel combustion;
owned vehicles and special-purpose equipment;
technological and production processes;
flaring;
refrigerant leaks;
methane and other greenhouse gas emissions;
other direct sources specific to the enterprise’s activities.

For large companies, we develop an emission-source register, a source-data structure and a methodology for subsequent annual accounting.

Scope 2 — indirect energy emissions

We calculate emissions associated with the company’s purchased:

electricity;
thermal energy;
steam;
cooling and other purchased energy resources.

Where necessary, we perform location-based and market-based calculations and analyze the structure of energy consumption and the impact of electricity sources on the corporate carbon footprint.

Scope 2 makes it possible to determine where a transition to energy-efficient equipment, renewable energy or low-carbon energy sources can have the greatest impact.

Scope 3 — value-chain emissions

Scope 3 often accounts for the majority of a company’s carbon footprint and requires substantially more in-depth work with data. We identify applicable Scope 3 categories and calculate emissions associated with:

purchased goods and services;
capital goods;
fuel and energy resources not included in Scope 1 and Scope 2;
transportation and logistics;
waste generation;
business travel;
employee commuting;
leased assets;
transportation of sold products;
processing and use of products;
end-of-life treatment of products;
franchises;
investments and financed assets.

For complex supply chains, we can screen Scope 3 categories, identify the most significant sources and gradually improve data quality from calculations based on expenditure and industry factors to calculations based on physical indicators and supplier data.

Financed emissions — Scope 3 Category 15

A separate HPBS service area is the calculation of financed emissions for banks, financial institutions and investment portfolios. In the financial sector, the main climate impact lies not in a bank’s offices and own energy consumption, but in the companies and projects it finances. We therefore calculate Scope 3 Category 15 — Investments / Financed Emissions using the PCAF — Partnership for Carbon Accounting Financials methodology.

The work includes:

defining the boundaries of the loan and investment portfolio;
classifying financial assets;
calculating financed emissions for individual borrowers and assets;
calculating attribution factors;
using borrowers’ actual emissions data or calculation models;
working with financial, industry and physical indicators when primary data are unavailable;
assigning and analyzing the PCAF Data Quality Score;
identifying the most carbon-intensive industries and borrowers;
developing the portfolio emissions structure;
developing a system for subsequently collecting climate data from the bank’s clients;
recommendations for improving data quality and integrating climate indicators into lending processes.

This analysis enables financial institutions to move from assessing their own operational footprint to understanding the climate impact of their entire loan and investment portfolio. At the next stage, the results can be used to develop a climate strategy, identify priority sectors for decarbonization, engage with borrowers and develop sustainable- and climate-finance products.

How can we help?

1. Defining organizational and operational boundaries

We define the company’s structure, assets, subsidiaries, emission sources and the applicable data-consolidation approach.

2. Data collection and source audit

We analyze energy consumption, fuel, production, transport, procurement, logistics, waste, assets and other emission sources. We assess data completeness and identify Data Gaps that must be addressed to improve the quality of subsequent reporting.

3. Project-team training

We provide practical training to the client’s employees on:

GHG Protocol Scope 1, 2 and 3;
calculation methodology;
emission factors;
source-data requirements;
internal quality control;
report preparation and verification.

Our objective is not only to perform the calculation, but also to develop internal organizational competence for subsequent emissions management.

4. Emissions calculation

We develop the calculation methodology and determine emissions for each material source. We use national and international emission factors and industry databases and, where necessary, develop specialized calculation logic for the company’s specific processes.

5. Carbon-profile analysis

We identify:

the main emission sources;
carbon-intensive processes;
the most significant Scope 3 categories;
structural reasons for emissions growth;
potential reduction areas;
decarbonization priorities.

For banks, we additionally analyze the distribution of financed emissions by industry, borrower, asset type and source-data quality.

6. MRV system development

We help transition from a one-time calculation to a permanent Monitoring, Reporting and Verification (MRV) system.

We develop:

a corporate emissions-accounting methodology;
a source register;
a responsibility matrix;
data-collection and verification procedures;
an emission-factor structure;
calculation algorithms;
requirements for storing historical data;
a quality-control system;
rules for adjustments and base-year recalculation;
procedures for preparing data for independent verification.

Digital MRV tools

For companies with many facilities, branches, assets or data sources, HPBS develops the architecture and technical logic of digital MRV systems.

Digitalization replaces annual manual spreadsheet collection with a permanent carbon-data management system.

We develop:

the structure of a digital register of Scope 1, 2 and 3 sources;
calculation algorithms;
emission-factor databases;
directories of fuels, energy, materials and activities;
logic for automatic emissions calculation;
a structure for collecting data across branches and assets;
a quality-control and anomaly-detection system;
user roles and access levels;
interfaces for internal specialists and verifiers;
requirements for APIs and integration with ERP, accounting systems, energy-management systems and other corporate data sources;
emissions-trend and KPI dashboards;
scenario-analysis and decarbonization-measure tracking tools.

For financial institutions, a digital MRV system can additionally include calculation of financed emissions across the loan portfolio, the PCAF Data Quality Score, industry analysis and collection of climate data from borrowers. As a result, the corporate GHG inventory becomes a digital tool for managing climate indicators and making decisions.

Reporting and international requirements

Based on the calculation, we prepare materials for corporate and international climate and ESG reporting and help structure data in accordance with the requirements of:

GHG Protocol;
ISO 14064;
CDP;
GRI;
IFRS S1 / IFRS S2;
international financial institutions;
ESG ratings;
investors and lenders;
national climate and carbon regulation.

Where necessary, inventory results are used to define a base year, prepare climate targets and develop an emissions-reduction pathway.

Our solutions

Corporate Scope 1, Scope 2 and Scope 3 calculation.
Screening and detailed calculation of Scope 3 categories.
Calculation of Scope 3 Category 15 financed emissions under PCAF.
Product carbon-footprint calculation.
Emissions calculation and preparation of data for CBAM.
Development of a corporate GHG methodology.
Development of an emission-factor database.
Development of an MRV system.
Development of technical requirements and calculation logic for digital MRV tools and automation of data collection.
Preparation for and support of independent verification.
Development of a greenhouse gas emissions-reduction strategy.
Development of decarbonization roadmaps.
Preparation of climate projects and support for the issuance of carbon credits.

Why does your business need this?

Attracting international financing.
High-quality climate data are becoming part of the requirements of banks, investors and international financial institutions.
Managing climate risks.
Understanding the emissions structure makes it possible to identify the most vulnerable assets, processes and supply chains.
Preparing for carbon regulation.
An emissions-accounting system provides the foundation for compliance with CBAM and other developing carbon-regulation mechanisms.
Improving the quality of ESG reporting.
Verifiable data improve company transparency for investors, clients and rating agencies.
Reducing costs.
Emissions analysis identifies energy- and resource-intensive processes where reducing the carbon footprint can simultaneously lower operating expenses.
Working with the supply chain.
Scope 3 identifies the climate impact of suppliers, logistics, products and other participants in the value chain.
Developing sustainable finance.
For banks, calculating financed emissions becomes the basis for portfolio assessment, engagement with borrowers and development of green- and climate-finance products.
Entering carbon markets.
An inventory and a high-quality MRV system create the initial foundation for developing climate projects and subsequently issuing carbon credits.

Your result

As a result of the project, the company receives not merely a figure for tonnes of CO₂ equivalent, but a carbon-footprint management system:

a transparent Scope 1, 2 and 3 structure;
a methodology and calculation model;
an understanding of the main sources and the business’s “carbon-intensive points”;
a structured source-data database;
a foundation for annual monitoring;
readiness for verification and ESG reporting;
data for making investment decisions;
a foundation for developing a decarbonization strategy and climate projects.

Emissions calculation is the first level of climate management. The next level is to turn emissions data into decisions on reducing costs, managing risks, attracting financing and decarbonizing the business. HPBS supports this process from the initial inventory through development of an MRV system and climate strategy to implementation of emissions-reduction projects.

Contact us:
info@hpbs.uz
+998 (90) 930-65-66

Additional information