Quantifying emissions from energy use is a cornerstone of sustainability reporting and emissions reduction for property companies. To do this, so-called emission factors are used. But what exactly is an emission factor and how do they play a role in a company's sustainability work? In this article, we provide an introduction to what emission factors are and why they are crucial for calculating and reporting greenhouse gas emissions in the property sector.
This is an excerpt from a more comprehensive guide to emissions reporting in the real estate industry according to the GHG Protocol. Feel free to download the entire guide free of charge by clicking here!
Emissions... what?
An emission factor is a numerical standard or coefficient used to estimate the amount of emissions from a particular activity or energy source. It expresses the amount of greenhouse gases emitted per unit of activity, such as per litre of petrol burned or per kilowatt hour (kWh) of energy used. Since it is not always practical to directly measure emissions from all sources, emission factors are used to estimate these values based on average data.
Why are emission factors important in the property industry?
In the property industry, energy consumption is one of the largest sources of emissions, especially for large buildings and property portfolios. By using emission factors, property owners can calculate the amount of carbon dioxide (CO₂) and other greenhouse gases generated by their energy use. These calculations play a central role in sustainability reporting and help companies meet requirements from standards such as the GHG Protocol and European legislation such as CSRD.
Energy and Emission Factors
Emission factors vary depending on the type of energy source used. Renewable energy, such as solar and wind power, often has very low or even non-existent emission factors, while energy from fossil fuels, such as coal and oil, has significantly higher emissions. For example, electricity from a coal-fired power plant can have an emission factor that is many times higher than that from a solar power plant. Understanding and choosing the right energy source is therefore crucial to reducing a company's overall climate impact.
The Swedish Environmental Protection Agency refers to 90 g CO₂ equivalents per kWh for the Nordic electricity mix, which means that for every kilowatt hour (kWh) of electricity consumed in the Nordic electricity system, an average of 90 grams of carbon dioxide equivalents are released into the atmosphere. This value takes into account both the electricity produced within the Nordic countries and the electricity imported and exported to and from other regions.
In other words, the Nordic electricity mix includes electricity from various sources such as hydropower, wind power, nuclear power and fossil fuels. Some energy sources, such as hydropower and wind power, generate very little or no greenhouse gases, while fossil fuels such as coal and natural gas have higher emissions.
Emission factor refers to the amount of greenhouse gases emitted per unit of energy produced (in this case per kWh). It is an important tool when calculating the climate impact of energy use. By multiplying the amount of energy used by this factor, you can determine your total emissions.
Example:
If a property owner uses 10,000 kWh of electricity in a year, we can use the emission factor of 90 g CO₂e/kWh to calculate their greenhouse gas emissions from electricity use:
10,000 kWh × 90 g CO2e/kWh = 900,000 g CO₂e = 900 kg CO2e
This means that their electricity consumption causes emissions equivalent to 900 kg CO₂e in one year.
Emissions factors for energy are therefore based on the amount of greenhouse gases produced per unit of energy over a given period of time. The total amount of emissions is divided by the total amount of energy produced to obtain an emissions factor for each energy source. For example, the emissions of a coal-fired power plant per kWh of electricity produced can be calculated in this way. By using these factors, companies can quickly and efficiently calculate their energy-related emissions.
Standardisation of Emission Factors
Several international organisations, such as the GHG Protocol and the IPCC, offer standardised emission factors that are used worldwide. These standards ensure that companies can report their emissions in a comparable manner and in accordance with global guidelines. For property owners, it is particularly important to use the correct emission factors for energy, as this often accounts for the largest share of their total emissions.
A tool for sustainability work
Emission factors are an essential part of property owners' toolkit for understanding, reporting and reducing their greenhouse gas emissions. By using standardised values, they can effectively quantify their impact on the climate and ensure that their sustainability work is in line with global standards and future legal requirements. With the right understanding and use of emission factors, property companies can not only improve their reporting but also make real progress towards reducing their emissions and contributing to a more sustainable future.
