When an supplier receives Product Carbon Footprint (PCF) requests from customers, detailed product-level emissions data may not always be readily available. In such cases, an allocation approach using existing corporate footprint data can provide a practical interim solution. This article outlines the key steps and considerations for this methodology.
Understanding the Approach Understanding the Approach
The proportion-based method allocates a company's total corporate emissions across its product portfolio based on relevant allocation factors such as production volume, economic value, or other appropriate metrics. Whilst this approach is considered to be less accurate than product-level data, it provides a reasonable estimate when detailed product data is unavailable and a company produces a commodity or homogeneous product.
Step 1: Assess Corporate Footprint Completeness
Step 1: Assess Corporate Footprint Completeness
Before calculating emissions intensity figures, the company should ensure the corporate footprint captures the relevant GHG Protocol Scope Categories:
Required Scope Coverage:
Scope 1: Direct emissions from owned/controlled sources
Scope 2: Indirect emissions from purchased energy
Scope 3: Relevant upstream categories, particularly:
Category 1: Purchased goods and services (Product & Packaging Inputs)
Category 4: Upstream transportation and distribution
Key Consideration: Product carbon footprints typically use a cradle-to-gate boundary, so the corporate footprint should adequately capture upstream emissions that would be attributed to the specific product. If any emissions are excluded, details should be provided in the 'Excluded Emission' section of the PCF survey, this could include emissions linked to but not limited to commuting, business travel, etc.
Step 2: Determine Appropriate Allocation Methods
Step 2: Determine Appropriate Allocation Methods
The choice of allocation method significantly impacts accuracy and should align with what type of product the intensity figures are being calculated for and how the emissions associated are actually generated. According to Altruistiq's allocation methodology, several methods are available:
Mass-Based Allocation
Most appropriate when:
Products have similar production processes
Emissions intensity correlates with product weight
Calculation using Allocation Factor (AF):
AFₓ = (Mass of product x × Total number of product x produced) / Total mass of products
Revenue-Based Allocation
Consider when:
Mass allocation doesn't reflect emission intensity differences
Products have significantly different values
Economic allocation is more representative
Calculation using Allocation Factor (AF):
AFₓ = (Revenue of product a × Total number of product x produced) / Total revenue of products
Step 3: Collect Required Activity Data
Step 3: Collect Required Activity Data
The company should gather the necessary data for the chosen allocation method:
For Mass Allocation:
Total production volumes by product
Product-specific masses or volumes
Production facility information
For Revenue Allocation:
Product-specific revenue data
Total company revenue for the period
Supporting Data:
Facility-level production data where available
Product composition information
Manufacturing process similarities/differences
Step 4: Perform the Allocation Calculation
Step 4: Perform the Allocation Calculation
Basic Allocation Formula
Product PCF = (Allocation Factor / Total Allocation Base) × Relevant Corporate Emissions
Step 5: Documentation
Step 5: Documentation
The company should provide transparent documentation of the methodology:
Allocation method selection rationale
Data sources (e.g. EFDB used for PG&S calculations)
System boundary definitions (e.g. cradle-to-gate, cradle-to-grave)
Calculation methodology (e.g. GHG Protocol)
Key assumptions and limitations (e.g. Average weight per unit considered)
Key Considerations
There are multiple cases where this approach may not be suitable, as listed below: High Variability Products: When products have significantly different emission intensities that aren't captured by the allocation factor
Process-Specific Emissions: For products with unique manufacturing processes not well-represented in overall corporate emissions
Complex Co-Product Systems: Where multiple valuable products are produced simultaneously and require sophisticated allocation approaches
Conclusion
The proportion-based approach using corporate footprint data provides a practical starting point for PCF reporting when detailed product data isn't available. However, it should be viewed as an interim solution whilst working towards more detailed product-level emissions tracking.
This methodology's success depends heavily on selecting appropriate allocation factors and maintaining transparency about limitations.