News Article
September 14, 2008

Taking Stock: Using a GHG Inventory to Bring Emissions into View

Establishing a carbon management plan depends first on getting an accurate read on the extent of an organization’s emissions. This is not as simple as reading the meter on energy use, however, as greenhouse gas (GHG) emissions emanate from many different aspects of doing business. Common activities that produce emissions include building heating and cooling, fleet vehicles, electricity use, and employee travel. All these activities and more must be examined in order to get an accurate GHG inventory and provide the organization with the information it needs to effectively reduce emissions.


Getting Started

A GHG inventory will provide the organization with a summary of emission sources associated with the organization’s activities, and the associated emissions quantified using standardized methods. Establishing an inventory involves the following steps:

  • Choose a base year for the GHG emissions inventory, against which future emissions will be tracked.

  • Identify the facilities to include in the inventory (“organizational boundaries”).

  • Identify the sources within the facilities to include in the inventory (“operational boundaries”).

  • Follow a standardized and accepted methodology to calculate the GHG emissions from each identified source.

Calculating Emissions

The GHG Protocol Corporate Accounting and Reporting  Standard (“GHG Protocol”), created by the World Resources Institute and the World Business Council for Sustainable Development, is recognized as the global standard for calculating GHG emissions.  The GHG Protocol is based on five principles:


  1. Relevance: Ensure the GHG inventory appropriately reflects the GHG emissions of the company and serves the decision-making needs of users—both internal and external to the company.

  2. Completeness: Account for and report on all GHG emission sources and activities within the chosen inventory boundary. Disclose and justify any specific exclusions.

  3. Consistency: Use consistent methodologies to allow for meaningful comparisons of emissions over time. Transparently document any changes to the data, inventory boundary, methods, or any other relevant factors in the time series.

  4. Transparency: Address all relevant issues in a factual and coherent manner, based on a clear audit trail. Disclose any relevant assumptions and make appropriate references to the accounting and calculation methodologies and data sources used.

  5. Accuracy: Ensure that the quantification of GHG emissions is systematically neither over nor under actual emissions, as far as can be judged, and that uncertainties are reduced as far as practicable. Achieve sufficient accuracy to enable users to make decisions with reasonable assurance as to the integrity of the reported information.

What to Count

The inventory should include emissions of all six major GHGs: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydroflurocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6).

Scope of Emissions

The GHG Protocol organizes emissions sources into the following three categories, or “scopes,” based on the level of control an organization exercises over them:

  • Scope 1: emissions from sources that the company owns or controls, like natural gas-fired boilers or vehicle fleets. These are also called “direct emissions.”

  • Scope 2: emissions that are a consequence of the operations of the company, but occur at sources owned or controlled by another company, most typically electricity, heat, or steam. These are also called “indirect emissions.”

  • Scope 3: indirect emissions that are not covered in Scope 2, such as employee travel and product transport. These are considered “optional emissions” and may or may not be included in the inventory, depending on how broadly the organization wants to control emissions associated in any way with its activities. 

The U.S. Environmental Protection Agency’s Guide to GHG Management for Small Business & Low Emitters offers a more detailed look at what might be included within these three scopes.


Documenting GHG Inventory Procedures

An Inventory Management Plan (“IMP”) is a useful tool for accurately documenting the processes used to collect the inventory data, so that a high quality GHG inventory can be completed year after year. An IMP documents the answers to questions like, “What facilities did we include in the inventory? Which sources are included? Who in the company collects the utility bill information? How do we account for new facilities or acquisitions?”

Partners develop and maintain an IMP that describes their process for completing a high-quality, corporate-wide inventory. The IMP is a protocol developed by each company which addresses their unique procedures for creating a credible corporate-wide GHG emissions inventory on an annual basis.


Additional Information

Many organizations choose to partner with the EPA via the Agency’s Climate Leaders program.  Organizations can take advantage of the EPA’s Inventory Calculator for Low Emitters, Inventory Management Plan for Low Emitters, and Goal Proposal Template.  These tools are available in the resources section of the EPA’s Climate Leaders website.

To learn more about quantifying and managing greenhouse gas emissions visit:



1 This article is adapted from the U.S. Environmental Protection Agency’s Guide to GHG Management for Small Business & Low Emitters [].