Emission Factor
An emission factor is a conversion value that translates activity data such as energy consumption or distance travelled into a quantity of greenhouse gas emissions, usually expressed in CO2 equivalents.
The emission factor is the central calculation parameter of any greenhouse gas inventory: it expresses how much greenhouse gas is released per unit of a given activity. Multiplying the activity data (for example kilowatt-hours of electricity, litres of diesel, kilometres driven or tonnes of material purchased) by the corresponding emission factor yields the emission quantity, which is typically reported in kilograms or tonnes of CO2 equivalent (CO2e). To make different greenhouse gases comparable, their respective global warming potentials are already built into the factor.
Emission factors are drawn from recognised databases and publications, such as the German Environment Agency (UBA), the UK DEFRA, the IEA, the IPCC or commercial databases like ecoinvent. Choosing the right factor is decisive for data quality: factors differ by country, reference year, energy carrier, technology and system boundary. For electricity in particular, a distinction must be drawn between a location-based and a market-based factor, as required by the GHG Protocol Scope 2 Guidance. It must also be disclosed whether only direct combustion emissions or upstream processes (well-to-tank) are included.
In the context of CSRD reporting, the ESRS E1 standard requires companies to report their gross greenhouse gas emissions across Scope 1, 2 and 3 and to make the underlying methods, assumptions and emission factors transparent. Traceable documentation of factor sources, their validity period and the calculation logic is a precondition for the greenhouse gas inventory to be confirmed under a limited assurance engagement. Incorrect or outdated emission factors systematically lead to flawed inventories and undermine the credibility of climate targets.
Legal Basis
ESRS E1 (Delegated Regulation (EU) 2023/2772); GHG Protocol Corporate Standard and Scope 2 Guidance
Practical Example
A sustainability manager prepares the first CSRD-compliant greenhouse gas inventory for her mid-sized company. For Scope 2 she determines electricity consumption of 1.2 million kWh and multiplies it on a location-based basis by the current emission factor of the German grid mix from the UBA data for the reporting year. In parallel she calculates the market-based value using the green electricity tariff under contract, with a factor of nearly zero. She reports both results separately and documents the source, reference year and version of each factor in an audit trail, so the external auditor can fully retrace the calculation under the limited assurance engagement.