Decoding Decarbonisation: What Scopes 1, 2, & 3 Mean for Your Drinks Business
With the positive news from the UK’s Climate Change Committee this week that the UK can meet it’s 2050 Net Zero target, I thought it would be worth doing one of our four-part series diving into the subject that’s become such a political football recently.
Around the world, businesses and politicians are making commitments to tackle climate change, and "Net Zero" has become the headline goal. But behind the pledges, headlines, and press releases lies a complex landscape of data, definitions, and strategic decisions. Before we can effectively reduce our climate impact, we must first understand the language of decarbonisation, which I’ll admit, can be confusing at first with talk of scopes, offsets, insets, science based targets, and more.
So, what do terms like "Net Zero," "Scope 1," "Scope 2," and the notoriously tricky "Scope 3" actually mean for a distillery, brewery, winery, or brand?
Consider this first article as your practical guide to decoding the framework.
First, What is "Net Zero"?
In simple terms, achieving Net Zero means reducing greenhouse gas (GHG) emissions as close to zero as possible across the entire value chain, and then removing any residual, unavoidable emissions from the atmosphere through carbon removal projects. It's a holistic goal, guided by climate science, that prioritises deep and rapid emissions cuts above all else, which is the really important part. This is distinct from being "carbon neutral," which can sometimes rely more heavily on simply purchasing increasingly unreliable carbon offsets to balance out existing emissions without a primary focus on reduction.
To create a meaningful reduction plan, we first need to categorise our emissions. The global standard for this is the Greenhouse Gas (GHG) Protocol, which splits emissions into three 'scopes'. Let’s break these down so they’re easy to understand for your business.
Scope 1: Your Direct Emissions
These are the emissions released directly from sources that your company owns or controls. Think of it as the exhaust fumes coming directly from your own operations.
For a drinks business, Scope 1 includes:
On-site Fuel Combustion: Burning gas, oil, or other fuels in boilers to generate heat and steam for brewing, distillation, pasteurisation, and cleaning.
Company-Owned Vehicles: The emissions from your delivery vans, sales fleet, or any on-site farm vehicles (like tractors) that your business owns and operates.
Fugitive Emissions: Leaks of refrigerant gases from cooling systems, air conditioning units, or CO₂ from carbonation systems.
Scope 2: Your Purchased Energy Emissions
These are indirect emissions generated from the production of the electricity, steam, heating, or cooling that you purchase and consume. The emissions don't happen at your facility, but they are a direct result of your energy demand.
For a drinks business, Scope 2 includes:
Purchased Electricity: This is the most common example. It's the emissions footprint of the electricity used to power your lights, offices, bottling lines, pumps, compressors, and all other electrical equipment.
Purchased Heat/Steam: If your facility is on a district heating network and you purchase steam, the emissions from generating that steam fall into Scope 2.
Scope 3: The Big One – Your Entire Value Chain
This is the most comprehensive and, for most drinks businesses, by far the largest category. Scope 3 covers all other indirect emissions that occur in your company's value chain, both upstream (from your suppliers) and downstream (from your customers).
For a drinks business, key Scope 3 categories include:
Upstream Activities:
Purchased Goods & Services: This is a massive one. It includes the entire carbon footprint of everything you buy, such as:
Agricultural Emissions: Growing your barley, grapes, apples, botanicals, etc. (This includes emissions from fertilisers, soil management, and farm machinery).
Packaging Production: Manufacturing your glass bottles, aluminium cans, cardboard boxes, labels, and closures.
Transportation & Distribution: Emissions from third-party logistics partners moving your raw materials to your facility and distributing your finished products to retailers.
Business Travel: Emissions from flights, trains, and hire cars for work purposes.
Employee Commuting: Emissions from your team travelling to and from work.
Downstream Activities:
Use of Sold Products: For drinks, this is often the energy used by citizens to chill the product in their fridge, or the ingredients used by bartenders to make cocktails using your products.
End-of-Life Treatment of Sold Products: Emissions associated with the recycling or disposal of your packaging after it has been consumed.
Why Does Understanding the Scopes Matter?
Categorising emissions in this way is the critical first step. It allows your business to conduct a comprehensive carbon footprint assessment, revealing where your biggest impacts – or "carbon hotspots" – truly lie. For virtually every drinks brand, the majority of emissions (often 80-90% or more) will be in Scope 3, particularly in agriculture and packaging.
Without understanding this breakdown, it's impossible to create an effective, targeted decarbonisation strategy. You might spend all your effort on installing solar panels (tackling Scope 2) while the enormous footprint of your packaging choices (Scope 3) goes unaddressed.
Next Steps on the Path to Net Zero
Now that we've decoded the language, we can start to build our roadmap. In our next article, we will focus on practical strategies for tackling the emissions you have the most direct control over: your Scope 1 and Scope 2 footprint within your production facilities.
