Have You Heard of Scope 3? It Offers Opportunity for Agriculture
You might have heard the term Scope 3 thrown around. It’s all the buzz lately in the world of sustainability. But what does it mean?
A company’s emissions are broken down into Scopes 1, 2 and 3. This helps them account for different categories of their greenhouse gas (GHG) emissions:
• Scope 1 refers to direct emissions controlled by the company, which include emissions from their operations and facilities.
• Scope 2 addresses indirect emissions from energy an organization purchases or brings in to operate the business.
• Scope 3 covers indirect emissions from the company’s supply chain, both upstream and downstream.
Scope 3 is where things get interesting for farmers and the rest of agriculture’s “upstream” supply-chain partners. Upstream means all of the materials and transportation required before something gets to the company for production or processing.
We’re all aware companies are evolving their sustainability strategies. Increasingly, they’re working to meet the sustainability demands of their customers and the various voluntary initiatives established by their leadership and downstream supply-chain partners. As a result, businesses must be able to measure and reduce their Scope 3 emissions. It’s especially important for companies whose supply chain includes agriculture. Like it or not, agriculture is considered one of the primary contributors of GHG emissions and climate change. McKinsey & Company recently reported agriculture is responsible for about 24% of global emissions, making agricultural emissions a major focus of decarbonization efforts.
Onerous as this sounds, this creates tremendous opportunities for farmers who have already reduced emissions, or will in the future, through on-farm practices, such as reduced energy usage, improved soil health measures and reduced machinery passes on a field.
When will Scope 3 opportunities be available in your area? This is the big question. Many existing and new companies are collaborating to understand which methodologies, strategies and systems are required to support this new type of sustainability accounting in a way that’s consistent and realistic for our fragmented industry. New pilot programs are popping up regularly. But, so far, they have been concentrated in very small regions and vary greatly from one program to the next.
If you believe you have practices that could support Scope 3 reductions, talk to your local agribusiness partners to see what’s available in your area. Consider reaching out to your grain elevator, meat packer, dairy processor or other supply-chain partners.
If there is a new sustainability company or expert reaching out to you for a meeting, take the time to listen. They could be bringing you new opportunities to monetize sustainable practices on your farm or providing valuable information to help better educate you on decarbonization or Scope 3 opportunities in your area. Not every opportunity might be right for your farm, but taking the time to get better educated on the landscape will be valuable now and in the future.
Heather Gieseke’s insights help position agribusinesses for growth and profitability – from risk management to carbon mitigation, emission reduction and other agriculture advocacy related initiatives. A leader of Pinion’s sustainability practice, Heather champions sustainability for the farm, family and business.
