How to Calculate Emissions for Service Based Suppliers

Understanding the carbon footprint of your supply chain is a critical part of any credible decarbonization strategy. But when it comes to service based suppliers, calculating emissions can feel less straightforward than for manufacturers or product based vendors. There’s no physical good to track, production process to audit, or raw materials to quantify, so where do you begin?At DitchCarbon, we follow a structured approach that ensures accuracy while keeping the process as streamlined as possible. Here’s how it works.---## 1. Start With Supplier Specific Emissions DataWhenever possible, we begin with supplier specific disclosures. If a service based supplier publicly reports (or privately shares) their:- Scope 1 emissions – direct emissions from owned or controlled sources- Scope 2 emissions – indirect emissions from purchased electricity, heat, or steam- Relevant upstream Scope 3 categories – for services, this often includes business travel, fuel and energy related activities, and purchased goods or services…we use that real data as the foundation of our calculation.From these disclosures, we generate a supplier specific, spend based emission factor. This gives you a customized estimate of emissions per dollar spent with that supplier, far more precise than generic industry averages.---## 2. When Supplier Data Isn’t Available: Use Industry Emission FactorsOf course, many service providers don’t yet report their emissions. In these cases, rather than leaving a data gap, we turn to high quality industry level emission factors.Right now, our preferred source is the U.S. EPA dataset. We use it because:- It provides strong industry level granularity, essential for service categories that differ widely (e.g., consulting vs. IT services vs. financial services).- It’s regularly updated and widely respected in sustainability reporting.- It aligns well with common GHG accounting frameworks.Using this dataset, we assign the supplier the most accurate industry average emission factor available, ensuring you still get reliable, actionable data even when the supplier isn’t yet reporting.---## 3. Why This Approach WorksThis two tier method balances accuracy, coverage, and practicality:- _Accurate when possible_: Supplier specific emissions anchor your calculations in real data.- _No blind spots_: Industry fallback factors ensure you always have an estimate.- _Consistent across suppliers_: Whether highly mature or just beginning sustainability reporting, all suppliers fit into the model.The result is a scalable, transparent, and defensible way to assess emissions from service based suppliers, an area where traditional methods often fall short.