A glossary of carbon terms for sustainability Carbon 101

A quantitative measure of a level of activity that results in GHG emissions. Activity data is multiplied by an emissions factor to derive the GHG emissions associated with a process or an operation. Examples of activity data include kilowatt-hours of electricity used, quantity of fuel used, output of a process, hours equipment is operated, distance traveled, and floor area of a building.

The process of assigning responsibility for GHG emissions from a specific generating unit or other system (e.g., vehicle, business unit, corporation) among its various users of the product or service.

Avoided emissions refer to the greenhouse gases that are not emitted due to sustainable practices or technologies, which would have otherwise been released in a 'business as usual' scenario.

A year against which GHG emissions are tracked over time.

Recalculation of emissions in the base year to reflect a change in the structure of the company or a change in the accounting methodology used, to ensure data consistency over time.

A hypothetical description of what would have most likely occurred in the absence of any considerations about climate change mitigation. For grid-connected project activities, the baseline scenario is presumed to involve generation from the build margin, the operating margin, or a combination of the two.

Fuel made from plant material, such as wood, straw, and ethanol from plant matter.

CO₂ emissions produced by living organisms or combustion/biodegradation of biomass, but not fossilized or from fossil sources.

Any material or fuel produced by biological processes of living organisms, including organic non-fossil material of biological origin (e.g., plant material), biofuels (e.g., liquid fuels produced from biomass feedstocks), biogenic gas (e.g., landfill gas), and biogenic waste (e.g., municipal solid waste from biogenic sources).

The universal unit of measurement to indicate the global warming potential (GWP) of each GHG, expressed in terms of the GWP of one unit of carbon dioxide.

Carbon accounting, also known as greenhouse gas (GHG) accounting, is a systematic process for calculating and tracking an organization's emissions of greenhouse gases. This process utilizes both activity-based and spend-based methodologies to quantify emissions.

A carbon credit represents a metric ton of CO2 equivalent that is avoided or sequestered outside the GHG accounting boundary.

Carbon markets are platforms where carbon credits are traded to offset greenhouse gas emissions. Companies and individuals purchase these credits, representing one metric ton of reduced, sequestered, or avoided carbon dioxide or its equivalent.

Regulated systems where companies must trade carbon credits to meet legal emission limits set by governments or international bodies, such as the European Union Emissions Trading System (EU ETS).

Unregulated markets where businesses and individuals voluntarily buy carbon credits to offset their emissions or support sustainability initiatives, often through certified carbon reduction projects.

A carbon footprint is a measure of the total amount of greenhouse gases, primarily carbon dioxide (CO2), emitted into the atmosphere each year by a person, organization, or activity. It reflects the impact of human activities on the environment in terms of carbon emissions.

A carbon footprint of products (CFP) represents the total amount of GHG emissions and removals associated with a product throughout its life cycle, from raw material acquisition to production, distribution, use, and end-of-life disposal.

The amount of GHG emissions per unit of product or activity. Carbon intensity can be used to compare the environmental impact of different products or processes.

A state where annual GHG emissions are completely canceled out or removed through offsetting or carbon dioxide removal (CDR) or emissions removal measures.

A mechanism by which a company can compensate for its greenhouse gas emissions by funding projects that reduce emissions elsewhere, such as renewable energy or reforestation projects.

An economic system that is based on minimizing waste and maximizing the use of resources by reusing, repairing, and recycling products and materials.

Corporate emissions are greenhouse gases released by company operations, categorized into three scopes by the Greenhouse Gas Protocol: direct, indirect from energy, and other indirect.

Cradle-to-Gate assesses a product’s environmental impact from raw material extraction to when it exits the factory but excludes its use and disposal phases.

Cradle-to-Grave evaluates a product’s full environmental impact from raw material extraction through manufacturing, use, and ultimate disposal.

Emissions from sources that are owned or controlled by the reporting company.

Two or more reporting entities claiming the same emissions or reductions in the same scope, or a single entity reporting the same emissions in multiple scopes.

Version 3.0 of the impact assessment method of the Environmental Footprint (EF), no long-term (LT) Initiative. This method was developed by the European Commission under the Developer Environmental Footprint (EF) and is available as an LCIA method in ecoinvent 3.9.1. It is a PEF-compliant and recommended methodological approach for quantifying environmental performance by the European Commission.

The total amount of carbon emissions associated with the production of a product or service, including emissions from raw material extraction, processing, manufacturing, transportation and disposal.

A factor that converts activity data into GHG emissions data (e.g., kg CO₂e emitted per liter of fuel consumed, kg CO₂e emitted per kilometer traveled, etc.).

The release of Greenhouse Gases (GHGs) such as Carbon dioxide (CO₂) and Methane (CH₄) into the atmosphere.

A lease that transfers substantially all the risks and rewards of ownership to the lessee and is accounted for as an asset on the balance sheet of the lessee. Also known as a capital or financial lease. Leases other than capital/financial/finance leases are operating leases.

Financed emissions are greenhouse gases produced indirectly through an organization's investment activities, such as those resulting from loans, investments, and underwriting.

A consolidation approach whereby a company accounts for 100 percent of the GHG emissions over which it has financial control. It does not account for GHG emissions from operations in which it owns an interest but does not have financial control.

The ability to direct the financial and operating policies of an entity with a view to gaining economic benefits from its activities.

A widely used standard developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) for measuring and reporting greenhouse gas emissions.

Global average carbon calculation uses universal emission benchmarks per activity unit, simplifying carbon footprint estimates at the cost of accuracy and regional detail.

A factor describing the radiative forcing impact (degree of harm to the atmosphere) of one unit of a given GHG relative to one unit of CO2.

Green financing involves allocating funds to projects and businesses that provide environmental benefits, like renewable energy, to support sustainable economic growth.

A quantified list of GHG emissions and sources.

GHGs are the seven gases covered by the UNFCCC: carbon dioxide (CO2); methane (CH4); nitrous oxide (N2O); hydrofluorocarbons (HFCs);perfluorocarbons (PFCs); sulphur hexafluoride (SF6); and nitrogen trifluoride (NF3).

Hybrid carbon calculation combines spend-based and process data for a more precise and comprehensive emissions profile, balancing scalability and data accuracy.

ISO 14001 is the internationally recognized standard for environmental management systems (EMS). It provides a framework for organizations to design and implement an EMS, and continually improve their environmental performance.

ISO 14004 provides guidance for an organization on the establishment, implementation, maintenance and improvement of a robust, credible and reliable environmental management system.

ISO 14005 gives guidelines for a phased approach to establish, implement, maintain and improve an environmental management system (EMS) that organizations, including small and medium-sized enterprises (SMEs), can adopt to enhance their environmental performance.

ISO 14006 gives guidelines for assisting organizations in establishing, documenting, implementing, maintaining and continually improving their management of ecodesign as part of an environmental management system (EMS).

ISO 14015 gives guidance on how to conduct an environmental due diligence (EDD) assessment through a systematic process of identifying environmental aspects, issues and conditions as well as determining, if appropriate, their business consequences.

ISO 14016 gives principles and guidelines for assuring the environmental information an organization includes in its environmental reports.

ISO 14017 specifies principles, requirements and guidelines for the verification and validation of water statements.

ISO 14020 provides guidance for General principles for environmental labels and declarations.

ISO 14021 provides guidance for Self-declared environmental claims (Type II environmental labeling).

ISO 14024 provides guidance for Environmental labels and declarations (Type I environmental labeling).

ISO 14025 provides guidance for Environmental labels and declarations (Type III environmental declarations).

ISO 14026 provides guidance for Environmental labels and declarations — Principles, requirements, and guidelines for communication of footprint information.

ISO 14027 provides guidance for Environmental labels and declarations — Development of product category rules.

This standard outlines the principles and framework for conducting a life cycle assessment (LCA) of products, processes, or services.

ISO 14044 specifies requirements and provides guidelines for life cycle assessment (LCA) including: definition of the goal and scope of the LCA, the life cycle inventory analysis (LCI) phase, the life cycle impact assessment (LCIA) phase, the life cycle interpretation phase, reporting and critical review of the LCA, limitations of the LCA, relationship between the LCA phases, and conditions for use of value choices and optional elements.

ISO 14064 specifies principles and requirements at the organization level for the quantification and reporting of greenhouse gas (GHG) emissions and removals. It includes requirements for the design, development, management, reporting and verification of an organization's GHG inventory.

ISO 14067 provides guidelines for quantifying and reporting the greenhouse gas (GHG) emissions associated with a product throughout its lifecycle. This method takes into account emissions produced during raw material extraction, manufacturing, distribution, use, and end-of-life stages.

Emissions that are a consequence of the operations of the reporting company, but occur at sources owned or controlled by another company. This includes scope 2 and scope 3.

A target defined by reduction in the ratio of emissions and a business metric over time e.g., reduce CO₂ per metric ton of cement by 12 percent between 2000 and 2008.

An international body of climate change scientists. The role of the IPCC is to assess the scientific, technical, and socioeconomic information relevant to the understanding of the risk of human-induced climate change

ISO (International Organization for Standardization) is an independent, non-governmental international organization that develops and publishes standards for various industries and sectors, with the aim of promoting quality, safety, and efficiency. ISO's standards are recognized worldwide and are used by businesses, organizations, and governments to improve products, services, and processes.

The inventory boundary of a GHG inventory identifies the gases, emission sources,geographic area, and time span covered by the GHG inventory. This is an imaginary line that encompasses the direct and indirect emissions included in the inventory. It results from the chosen organizational and operational boundaries.

Consecutive and interlinked stages of a product system, from raw material acquisition or generation of natural resources to end of life.

A method to assess the environmental impact of a product or service over its entire life cycle, from raw material extraction to end-of-life disposal.

The method for converting inventory data from a life cycle assessment into a set of potential impacts. This enables practitioners and decision-makers to better understand the damage caused by resource use and emissions.

A compilation and evaluation of the inputs and outputs of the measured system throughout its life cycle.

A method to quantify scope 2 GHG emissions based on average energy generation emission factors for defined locations, including local, subnational, or national boundaries.

A method to quantify scope 2 GHG emissions based on GHG emissions emitted by the generators from which the reporter contractually purchases electricity bundled with instruments, or unbundled instruments on their own.

The boundaries that determine the direct and indirect emissions associated with operations owned or controlled by the reporting company.

A consolidation approach whereby a company accounts for 100 percent of the GHG emissions over which it has operational control. It does not account for GHG emissions from operations in which it owns an interest but does not have operational control.

The boundaries that determine the operations owned or controlled by the reporting company, depending on the consolidation approach taken (equity or control approach).

A type of contract that allows a consumer, typically large industrial or commercial entities, to form an agreement with a specific energy generating unit. The contract itself specifies the commercial terms including delivery, price, payment, etc. In many markets, these contracts secure a long-term stream of revenue for an energy project. In order for the consumer to say they are buying the electricity of the specific generator, attributes shall be contractually transferred to the consumer with the electricity.

Primary data in carbon measurement is collected directly from a company's specific activities, providing accurate and specific insights for precise carbon footprint assessments.

A set of rules and requirements that define the methodology for conducting an LCA for a specific product category.

A methodology developed by the European Commission to measure the environmental impact of products based on LCA, with a focus on carbon and other environmental indicators.

A methodology used to assess the environmental footprint of a product or service, which defines the rules and requirements for conducting a Life Cycle Assessment (LCA).

A collaboration between CDP, the United Nations Global Compact (UNGC), the World Resources Institute (WRI), and the World Wildlife Fund (WWF) that helps companies set and achieve ambitious greenhouse gas reduction targets based on climate science.

Direct greenhouse gas emissions from sources that are owned or controlled by a company, such as emissions from fuel combustion in company-owned vehicles or boilers.

Indirect greenhouse gas emissions from the consumption of purchased electricity, heat, or steam by a company.

Indirect greenhouse gas emissions that occur in a company's value chain, including emissions from purchased goods and services, employee commuting, and the use and disposal of sold products.

Secondary data in carbon measurement is sourced from external datasets and research, enriching carbon assessments with broader industry context when primary data isn't feasible.

Spend-based carbon calculation estimates emissions by applying emission factors to financial expenditures on goods and services, often lacking in specificity.

An emission rate provided by an electricity supplier to its customers, reflecting the emissions associated with the energy it provides. Suppliers offering differentiated products (e.g. a renewable energy product) should provide specific emission rates for each product and ensure they are not double counted with standard power offers.

TCFD developed globally recognized recommendations for consistent, comparable climate-related financial disclosures to aid investors and stakeholders in assessing risks and opportunities.