The Cozero category Purchased logistics (Scope 3) encompasses third-party transportation and distribution services that are bought by the reporting company. The category includes:
Emissions from the distribution and storage of products purchased between a company’s tier 1 (direct) suppliers and its own operations in vehicles not owned or operated by the reporting entity
Third-party transportation and distribution services purchased by the reporting company.
Emissions may arise from the following transportation and distribution activities throughout the value chain: air, rail, road, sea, inland waterways as well as the storage of purchased products in warehouses, distribution centers, and retail facilities.
1) How this category aligns with carbon accounting standards
The Cozero category, Purchased logistics, is a source of upstream Scope 3 emissions, as defined by the GHG Protocol (see scope 3 subcategory 4). All Cozero emissions calculation methodologies follow the requirements for this Scope of emissions accounting.
The GHG Protocol Corporate Standard
The GHG Protocol Corporate Standard
The GHG Protocol Corporate Standard is an internationally-recognized go-to standard for estimating and reporting corporate GHG emissions. GHG emissions are categorized into three ‘Scopes'. For further information see here.
Scope 1 includes direct GHG emissions that originate from sources that are owned or controlled by the reporting company, e.g. generation of electricity, heat and steam, physical or chemical processing, transportation of materials and fugitive emissions. They are the most important source of emissions because they are the direct result of companies’ activities.
Scope 2 encompasses indirect emissions from the generation of purchased or acquired electricity consumed by the reporting company. These emissions are considered to be indirect because, although they arise as a result of the reporting company’s activities, they originate from sources that are owned and controlled by external entities.
In turn, these emissions are categorized as Scope 1 for the energy producer that generated the electricity, given that they arise from their owned and controlled resources.
Scope 3 emissions are all indirect emissions (not included in Scope 2) which occur in the value chain of the reporting company. In other words, the emissions that are linked to the company’s operations, but are outside of its control. Scope 3 emissions can be categorized into two high-level groups:
Upstream emissions: Indirect emissions related to the procurement of goods and services, starting from the initial sourcing and pre-processing stages. Upstream emissions can be attributed to the materials’ extraction, production and transportation processes before they reach the company.
Downstream emissions: Indirect emissions related to products and services sold by the reporting company, occurring after the products have been sold to the customer or end-user. Downstream emissions relate to activities such as distribution, storage, usage by consumers, and the eventual end-of-life disposal or recycling of the products.
2) Calculation methods
Here are the various calculation methods available in Cozero Log for calculating Scope 3 emissions from Purchased logistics. Users should choose the method that is the most appropriate to the data available to them, to their business goals and the significance of the emissions of the category.
2a. Fuel and electricity consumption methods
Emissions are estimated by collecting data on the quantity of fuel or electricity used for the company’s purchased logistics during the reporting period and multiplying by the relevant emission factor.
Activity data: volume of fuel or electricity (in case of electric means of transport) in kWh. Cozero provides conversion of other units.
Emission factor: Cozero provides a default fuel or electricity emission factor, but users can also enter supplier-specific emission factors.
How to report emissions in Cozero?
Step 1: Select the Log called “Purchased logistics”
Step 2: Select the subcategory (means of transport) you want to report on
Step 3: Select either “Electricity consumption” or “Fuel consumption” as calculation method
Step 4: Select the activity data source
Step 5: Enter the quantity of fuel or electricity used by the means of transport and where the data was procured from
Cozero Log will automatically calculate the emissions for the quantity of fuel or electricity entered.
For more information on market-based vs. location-based (Grid-mix) electricity accounting, please refer to the article on Purchased electricity.
2b. Distance method
Emissions are estimated by collecting data on the total distance traveled by purchased logistics during the reporting period and multiplying by the relevant emission factor. This method allows users to input the distance traveled in kilometers directly, or alternatively, they can set the origin and destination, in which case Cozero will automatically calculate the distance covered.
Activity data: distance traveled in km
Emission factor: Cozero provides a default distance emission factor matching the selected activity data but users can also enter supplier-specific emission factors.
How to report emissions in Cozero?
Step 1: Select the Log called “Purchased logistics”
Step 2: Select the subcategory (means of transport) you want to report on
Step 3: Select either “Vehicle distance traveled” or “Distance traveled (origin/destination)” as calculation method
Step 4: Select the activity data source
Step 5: Enter the distance traveled or origin/destination for the means of transport
Cozero Log will automatically calculate the emissions for the distance or origin/destination entered.
2c. Mass & distance method
Emissions are estimated by collecting data on the total mass and distance of goods transported during the reporting period and multiplying by the relevant emission factor. This method allows users to input the mass and distance in kilometers, or tonne kilometers directly. Alternatively, they can enter the mass and set the origin and destination, in which case Cozero will automatically calculate the distance covered.
Activity data: mass and distance of goods transported
Emission factor: Cozero provides a default mass & distance emission factor matching the selected activity data but users can also enter supplier-specific emission factors.
How to report emissions in Cozero?
Step 1: Select the Log called “Purchased logistics”
Step 2: Select the subcategory (means of transport) you want to report on
Step 3: Select the applicable “Mass and distance of goods transported” calculation method
Step 4: Select the activity data source
Step 5: Enter the mass and distance (alternatively origin/destination) or tonne kilometers for the means of transport
Cozero Log will automatically calculate the emissions for the mass and distance entered.
2d. Logistics site
The subcategory “Logistics site” falls into the Cozero category of purchased logistics, relating not to a means of transport, but rather to the storage of purchased products in warehouses, distribution centers and retail facilities. Emissions can be estimated using a number of methods already covered in this section to e.g. calculate the quantity of electricity or fuel used by the logistics site. Additionally, two methods are available that are unique to accounting for emissions from logistics sites. For these calculations, the data input is either in tonnes of goods shipped that pass through a storage facility or the size of storage taken up.
Activity data: type of storage and/or weight of stored goods in tonnes
Emission factor: Cozero provides a default emission factor matching the selected activity data but users can also enter supplier-specific emission factors.
How to report emissions in Cozero?
Step 1: Select the Log called “Purchased logistics”
Step 2: Select “Logistics site” as a subcategory
Step 3: Select either “Size of storage” or “Tonnes of goods shipped via logistics services” as calculation method
Step 4: Select the activity data source
Step 5: Enter the size of storage occupied or the tonnes of goods passing through the storage facility
Cozero Log will automatically calculate the emissions for the storage size or weight entered.
2e. Spend method
Emissions are estimated by collecting data on the economic value of the company's purchased logistics and multiplying by the relevant emission factor.
Activity data: amount spent on purchased logistics within the reporting period. The user can select one of the available currencies from the dropdown.
Emission factor: Cozero Log provides a default emission factor for purchased logistics per unit of economic value. Entered currencies are converted as needed automatically to match the emission factor.
How to report emissions in Cozero?
Step 1: Select the Log called “Purchased logistics”
Step 2: Select the subcategory (means of transport) you want to report on
Step 3: Select “Spend” as calculation method
Step 4: Select the activity data source
Step 5: Enter the amount spent on the means of transport
Cozero Log will automatically calculate the emissions for the spend entered.
2f. Direct emissions input
Users can enter the amount of emissions in CO2e directly in the Log. Make sure of the accuracy of data used in this estimation.
3) Where can I find the relevant data?
Activity Data:
Reports and data directly from logistics suppliers
Internal tracking of shipments and distances
Purchasing records
To find out more about data collection, you can refer to the article about Data Sourcing.