What Are “Location-Based” vs. “Market-Based” Emissions?

There are two ways of measuring the emissions from your purchased electricity (scope 2) — the "location-based" method and the "market-based" method.

The location-based method measures emissions from the local power grid wherever you do business. When you're connected to the power grid, you don't get to choose which electrons come down the wire. The location-based method is a reflection of the emissions footprint of your local utilities.

The market-based method, on the other hand, measures the emissions footprint of your energy purchase decisions. Some companies invest in renewable energy, working directly with solar and wind farms, etc. They do this via renewable energy certificates (RECs) or power purchase agreements (PPAs).

At Bend we track both location-based and market-based scope 2 emissions, but we default to the market-based method when adding up a company's total footprint. We prefer the market-based method in almost all cases, because the market-based measurement reflects a company's ability to vote with their dollars and drive towards a de-carbonized grid.

For more details, check out the GHG Protocol Scope 2 Guidance.