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Seeing The Full Picture: Firms Must Tackle Sold Product Emissions
For businesses seeking to pursue meaningful sustainability goals, it is no longer enough to deal only with the emissions generated from production and internal processes. If they fail to tackle the emissions produced by people using their products, they are missing a major part of the picture.
Downstream Scope 3 emissions categories have historically been neglected by emissions management functions, because they are difficult to account for and even harder to abate. However, data from the Carbon Disclosure Project (CDP) shows that Category 11: Use of Sold Product emissions can dominate emissions portfolios, especially in capital goods, fossil fuels and construction sectors. In comparison, business travel and employee commuting account for just 0.1% and 0.2% of a firm's total Scope 3 emissions, respectively.
As firms become more aware of their significance, Use of Sold Product emissions are beginning to receive significant attention. In early 2023, Airbus committed to a 46% reduction in its Use of Sold Product emissions by 2035, an SBTi-validated target. Similarly, Apple, Google and Microsoft have all launched initiatives to reduce their Use of Sold Product emissions through "carbon aware" software and clean charging technology. For Apple and Microsoft, Use of Sold Product emissions account for 24% and 28% of their total emissions portfolios, respectively.
As organizations pursue their decarbonization goals and near-term targets approach, they can no longer overlook this major source of emissions. Proactive recognition and engagement will enable firms to gain a market advantage and become industry leaders in decarbonization practices. Firms beware: if you’re not tackling downstream Scope 3 emissions, you’re not tackling emissions at all.
Alastair is an Analyst in the Verdantix Net Zero and Climate Risk practice. His current research agenda focuses on climate risk management software and carbon markets. Prior to joining Verdantix, Alastair worked at Tyler Grange Ltd where he gained experience in consultancy practices and environmental strategy. Alastair holds a First Class BSc in Biological Sciences from Durham University as well as an MSc in Sustainable Development from the University of St Andrews.