Scope 2 emissions are indirect greenhouse gas emissions from the generation of purchased electricity consumed by your facility. In India, every unit of electricity drawn from the state grid carries an embedded carbon footprint determined by that state’s generation mix — coal-heavy states like Jharkhand produce significantly more emissions per kWh than hydro-dominant states like Himachal Pradesh. Using the correct grid emission factor is critical for accurate, audit-ready Scope 2 reporting.
Why Scope 2 Accuracy Matters for Indian Manufacturers
Purchased electricity is the dominant emission source for most light manufacturing operations — particularly textile weaving, knitting, and garment manufacturing where process heat is secondary to motor-driven machinery. For these facilities, Scope 2 can represent 60–80% of total Scope 1 + 2 emissions.
Two precision risks:
- Using an outdated national average — the Central Electricity Authority (CEA) updates grid emission factors annually. Using a 3-year-old figure introduces material error into your BRSR disclosure.
- Ignoring captive solar — if you have rooftop solar or a captive wind plant, the electricity it generates displaces grid consumption and reduces Scope 2. This must be accounted for correctly.
Location-Based vs Market-Based Method
GHG Protocol Scope 2 Guidance (2015) introduced two calculation methods:
Location-Based Method Uses the average emission intensity of the grid where your facility is located. In India, this means the state-specific or national grid factor published by CEA. This is the method used for BRSR reporting.
Market-Based Method Uses emission factors from contractual instruments — Renewable Energy Certificates (RECs), Power Purchase Agreements (PPAs) with specific generators, or supplier-specific emission rates. Relevant for companies purchasing green power certificates. If no contractual instrument exists, the residual mix or location-based factor applies as a fallback.
For most Indian manufacturers currently, location-based method is the operative approach. Market-based becomes relevant when green power procurement is formalised.
CEA Emission Factors — How to Find and Use Them
The Central Electricity Authority (CEA) publishes the CO2 Baseline Database for the Indian Power Sector. This is the authoritative source for Indian grid emission factors.
National grid emission factor FY 2022–23: 0.716 tCO2/MWh (combined margin)
CEA publishes two margin factors:
- Build Margin (BM): Based on the most recently built power plants
- Operating Margin (OM): Based on the average operating grid
- Combined Margin (CM): 50% BM + 50% OM — used for most corporate GHG reporting
State-specific factors vary significantly:
| State | Grid Emission Factor (approx.) | Notes |
|---|---|---|
| Gujarat | ~0.82 tCO2/MWh | High coal dependence |
| Maharashtra | ~0.76 tCO2/MWh | Mixed coal + hydro |
| Tamil Nadu | ~0.68 tCO2/MWh | Growing renewables |
| Karnataka | ~0.58 tCO2/MWh | Hydro + wind contribution |
| Himachal Pradesh | ~0.20 tCO2/MWh | Predominantly hydro |
Note: Use CEA’s current published values — factors update annually.
Step-by-Step Scope 2 Calculation
Step 1: Collect electricity consumption data Source: monthly electricity bills from DISCOM (Distribution Company). Record consumption in kWh or MWh per meter. If multiple meters, aggregate all meters within your facility boundary.
Step 2: Identify your grid Which state DISCOM supplies your facility? Multi-state operations need state-specific factors per location.
Step 3: Select the correct CEA emission factor Download the latest CEA CO2 Baseline Database. Use the combined margin factor for the relevant state and the financial year matching your reporting period.
Step 4: Calculate
Electricity consumed: 2,400,000 kWh/year = 2,400 MWh/year
CEA combined margin factor (Gujarat, FY 2022-23): 0.82 tCO2/MWh
Scope 2 emissions = 2,400 MWh × 0.82 tCO2/MWh
= 1,968 tCO2/yearStep 5: Adjust for captive renewable generation If you have rooftop solar generating 400 MWh/year:
Net grid consumption = 2,400 - 400 = 2,000 MWh
Scope 2 emissions = 2,000 × 0.82 = 1,640 tCO2/yearThe 400 MWh of solar is zero-emission generation — it displaces grid power and reduces Scope 2.
Step 6: Document Record: meter reading source, CEA publication used, emission factor version, calculation formula. This documentation is what BRSR assurance auditors will examine.
Common Errors in Scope 2 Calculation
- Using national average when state-specific factor is available — acceptable but less accurate; some assurance bodies flag this
- Not updating CEA factors annually — factors change each year as grid mix evolves
- Double-counting captive solar — solar generation should reduce net purchased electricity, not be reported separately as a Scope 2 offset
- Mixing kWh and MWh units — divide kWh by 1,000 to get MWh before applying tCO2/MWh factors
- Omitting T&D losses — some methodologies add transmission and distribution loss factors; GHG Protocol location-based method using grid factors already embeds these losses in the combined margin factor
How Sustaineve Handles Scope 2
Sustaineve maintains a database of CEA emission factors updated annually when CEA publishes new baseline data. You enter electricity consumption from your bills, select your state, and the current factor is applied automatically. For facilities with captive renewables, the net consumption calculation is built into the data entry flow.
See the Scope 2 measurement module →
Frequently Asked Questions
How often does CEA update grid emission factors? CEA publishes the CO2 Baseline Database annually, typically covering the previous financial year. FY 2022–23 data was the most recently published as of early 2025. Always use the latest available publication matching your reporting period.
Should I use location-based or market-based for BRSR? BRSR does not specify, but location-based using CEA factors is the standard practice in India. If you have RECs or a green PPA, report both methods — BRSR Principle 6 has space for this.
Does rooftop solar eliminate my Scope 2? Only the electricity it actually generates and consumes on-site. If your solar produces 300 MWh but you consume 2,000 MWh from the grid, your Scope 2 is based on 2,000 MWh of grid consumption. The solar reduces your grid draw but does not zero-out Scope 2 entirely unless you are fully self-sufficient.
What about diesel DG set electricity generation? Electricity generated by your own diesel DG set is Scope 1 (combustion of diesel), not Scope 2. Scope 2 is only for electricity purchased from external sources.