How to Set an SBTi Baseline (2025 Guide): Scope 1 to 3, data sources, and recalculation rules

TL;DR

Your SBTi baseline is the reference inventory you'll use to calculate reductions over time. Pick a representative year, define clear boundaries (Scopes 1 to 3), document methods and assumptions, and adopt a recalculation policy for structural changes. Build quick coverage first, then improve accuracy over time.

1) What Exactly Is an SBTi Baseline?

Your baseline (often "base year inventory") is the emissions snapshot you'll use to calculate reductions over time. It should be:

• Complete: Includes Scopes 1, 2 (both market and location based), and all relevant Scope 3 categories.
• Consistent: Methods, factors, boundaries, and assumptions are defined and repeatable.
• Reproducible: Documented so a teammate or an auditor can recreate it.

2) Choose a Representative Baseline Year

Aim for data-rich and business-representative:

• Data availability & quality: Activity data for energy, refrigerants, logistics, business travel, and purchased goods & services.
• Business normality: Avoid anomalous years (e.g., unusual shutdowns or spikes).
• Structural changes: Consider acquisitions and divestitures and whether a recalculation may be required later.
• Comparability: Align with public disclosures where possible.

Tip: If your best year lacks data in one area, document a proxy with a plan to replace it in the next cycle.

3) Define Organizational and Operational Boundaries

Be explicit and write it down.

• Organizational boundary: Equity share vs. control; which entities, JVs, and regions are in scope.
• Scope 1: Stationary/mobile combustion, process emissions, fugitive gases (e.g., HFCs).
• Scope 2: Report both market based and location based electricity/steam/heat.
• Scope 3: Map relevance and materiality across categories (e.g., Cat.1 Purchased Goods & Services, Cat.4 Upstream Transport, Cat.6 Business Travel, Cat.11 Use of Sold Products). Prioritize material categories first, but plan to reach comprehensive coverage.

4) Gather Data Sources and Select Emission Factors

Scopes 1 to 2 activity data: Fuel volumes, kWh by site/tariff, refrigerant top ups, vehicle data (miles and km, fuel type).

Scope 3 approaches:

• Spend based (fast coverage): Map GL and AP data to categories and apply sector-average factors.
• Activity based (higher accuracy): Shipment weights and ton km, waste tonnage, product BOMs, supplier energy use.
• Supplier specific (highest relevance): Primary supplier data, program results (e.g., recycled content, energy switching).

Factor management: Use reputable factor libraries; version lock the set used for the baseline; retain source and year; avoid mixing incompatible geographies or vintages without documentation.

5) Make and Document Methodology Choices

Draft a short methods memo that covers:

• Electricity: Market- vs. location based methods; treatment of certificates and PPAs.
• Refrigerants: Leak-rate assumptions and data sources.
• Travel & commuting: Class-of-travel splits, WFH assumptions, survey methods.
• Purchased goods & services: When spend-, activity-, and supplier specific methods apply and how you prevent double counting.
• Data gaps & proxies: What you estimated, why it's reasonable, and how you'll improve it.

6) Create a Robust Recalculation Policy

Define when you'll adjust the baseline:

• Structural changes: Significant M&A, outsourcing and insourcing.
• Methodology/factor updates: Changes that materially shift base year totals.
• Material data corrections: Fixes to errors discovered post hoc.
• Boundary changes: New facilities or regions under control.

Set a governance cadence (e.g., annual review or after major transactions). Document the trigger, decision, and any recalculated values with rationale.

7) QA, Governance, and Audit Readiness

Before you lock the baseline:

• Completeness checks: Confirm relevant Scope 3 categories; scan for double counting.
• Reasonableness checks: Compare intensity metrics (tCO₂e/revenue, per unit, per FTE) to peers and prior years.
• Version control: Freeze factor versions; record transformations from source systems.
• Sign-off: Secure cross functional approval (finance, sustainability, operations).

8) Common Pitfalls (and Quick Fixes)

• Only Scope 1 to 2, weak Scope 3: Use spend based for rapid map coverage, then upgrade material categories.
• Single-method rigidity: Mixing methods is fine if you track where each applies.
• No recalculation policy: Write and ratify it now to avoid disputes later.
• Ambiguous Scope 2 reporting: Always present both market and location based results with clear certificate treatment.
• Untraceable vendor estimates: Tie supplier numbers to auditable initiatives and evidence.

9) Baseline Policy Template

9.1 Policy statement boilerplate

PurposeEstablish the base year GHG inventory used to measure performance against our science-based targets, ensuring completeness, consistency, reproducibility, and auditability.

ScopeThis policy covers organizational and operational boundaries, data sources, calculation methods, emission factors, QA, governance, and baseline recalculation triggers.

Effective date[YYYY-MM-DD]

Owner(s)Sustainability Lead (Policy owner); Finance (Data owner); IT/Data (System owner).

9.2 Organizational boundary register (copy-paste table)

9.3 Operational boundary register (Scopes 1 to 3)

Scope	Source / category	Included?	Method	Primary data source(s)	Factor source & vintage	Notes

Scope 1	Stationary combustion
	Mobile combustion
	Process emissions
	Fugitive (refrigerants)
Scope 2	Purchased electricity (location based)
	Purchased electricity (market based)					Certificates/PPAs handling
Scope 3	Cat.1 Purchased goods & services					Candidate year Business representativeness (1-5) Data completeness (1-5) Data quality (1-5) Structural anomalies (-2 to 0) Public comparability (1-3) Total 20XX 20XY Decision & rationale: Explain the winning year and any compensating controls/proxies 9.5 Data inventory & quality checklist Data domain Source system(s) Owner Coverage % Method (A/S/SS) Quality (1-5) Known gaps Fix plan & ETA Energy (kWh per site) [Utility portal, EMS] [Name] A Fuels (L/therms) [ERP, fleet] A Refrigerants [FM logs] A Business travel [TPM] A Missing rail legs Purchased goods & services [ERP/AP] S/SS Supplier splits unknown Logistics (ton km) [3PL] A/SS Waste [FM/vendor] A Use of sold products [Eng/Product] A/SS Duty cycle uncertain A = Activity based, S = Spend based, SS = Supplier specific 9.6 Methods & factors register (version locked) Category / source Method Factor library Factor code / name Geography Vintage Unit Notes Electricity (LB) Activity [Library vX.Y] [Grid mix code] [Country/Region] 20XX kgCO₂e/kWh Electricity (MB) Activity [Market vX.Y] [Residual mix / supplier EF] 20XX kgCO₂e/kWh Certificates scope Cat.1 PG&S (fallback) Spend [IO table vX.Y] [Sector code] 20XX kgCO₂e/$ Currency deflator used Logistics Activity [LCA vX.Y] [Mode x distance] 20XX kgCO₂e/ton km Supplier specific SS [Supplier doc] [ID] [Plant] 20XX kgCO₂e/unit Verification status 9.7 "Methods & Assumptions" memo skeleton Organizational boundary: approach, included entities, changes vs. prior year Operational boundary: Scopes 1 to 3 inclusions and exclusions Calculation methods: by category (A/S/SS), rationale, double-count controls Electricity methods: LB/MB, certificates and PPAs treatment Emission factors: libraries, vintages, geographies, version lock Data gaps & proxies: what, why reasonable, replacement plan QA & reasonableness: outlier rules, intensity comparisons, peer benchmarks Recalculation policy: triggers, thresholds, governance 9.8 Recalculation policy (triggers, thresholds, decision tree) Triggers (any may apply): Structural change (M&A, outsourcing and insourcing) Method/factor change that would materially shift base year totals Material data correction Boundary change (new facility under control) Materiality thresholds (set both): Relative: ≥ 5 to 10% change to base year total emissions (pick one band and fix it in policy) Absolute: ≥ [X,000] tCO₂e change to base year total Decision tree (text form): Did a trigger occur? → No: No action. Yes → Estimate impact on base year total → If ≥ threshold → Recalculate baseline (document, update targets if required) If < threshold → Document as non-material change, no recalculation. Baseline change log (copy-paste table) - Date Trigger Estimated impact (% / tCO₂e) Decision Approvers Notes / links Recalculate / No [Names] 9.9 QA rules (ready to implement) Completeness: All relevant Scope 3 categories decisioned (Included/Not relevant) with rationale. Double-count checks: Cat.3 vs Scope 1/2 fuel/electricity overlap Cat.4/9 vs internal logistics Cat.1 vs CapEx (Cat.2) classification Outlier detection: Any site/category ± >30% YoY without documented driver. Factor sanity: No mixed vintages for the same category without rationale; geography alignment checked. Intensity reasonableness: tCO₂e per revenue/unit/FTE compared to prior year and peer range. Version control: Factor set and methods memo have explicit version IDs. 9.10 Governance & RACI Activity Sustain. Finance Ops Procurement Legal IT/Data Exec Set baseline policy R A C C C C I Data sourcing C A R R R I Factor library/versioning R C A I QA & sign-off A R C C C I Recalculation decision A R C C C C I SBTi submission A R I (A = Accountable, R = Responsible, C = Consulted, I = Informed) 9.11 Intensity & benchmarking worksheet Metric Definition Baseline value Peer range (min-max) Source Notes tCO₂e / revenue Total Scope 1+2+3 / $ tCO₂e / unit Total / product unit tCO₂e / FTE Total / employee 9.12 Working papers index (kept inside your doc) Ref ID File / sheet name Owner Status Link (internal) Notes WP-01 Utility data by site [Name] Final [URL] WP-02 AP spend map to Cat.1 Draft WP-03 Factor pack vX.Y Final WP-04 Methods & Assumptions Final 9.13 Scope 3 relevance screening matrix (quick start) Category Typical data Relevance signals Decision (Y/N) Notes Cat.1 PG&S AP/GL, supplier splits High spend on materials/services Cat.3 Fuel & energy-related Energy bills Energy-intensive ops Cat.4 Upstream transport 3PL ton km Global supply chain Cat.6 Business travel TMC export High sales/consulting travel Cat.7 Commuting/WFH HR/surveys Office-based workforce Cat.11 Use of sold products Product duty cycles Energy-using products Cat.12 End-of-life Product materials Short life / high volume Optional appendix: example policy paragraph (ready to paste) We report Scope 2 using both location based and market based methods. Market-based results include supplier specific emission factors and the use of energy attribute certificates (EACs) in accordance with quality criteria. Recalculation of our 20XX baseline is triggered if any single change would alter base year emissions by ≥7% or ≥15,000 tCO₂e (whichever is smaller). All changes, material or not, are recorded in the Baseline Change Log with approver sign-off. How DitchCarbon Helps Fast coverage → precision: Map AP/GL to Scope 3 for immediate coverage, then upgrade hot-spots to activity and supplier specific data. Version-locked factor packs: Region-aware libraries with provenance and vintages for clean audit trails. Governance in-line: Built-in QA rules, change logs, and side-by-side recalculation comparisons against your materiality thresholds. SBTi-ready outputs: One-click exports of the Methods & Assumptions memo, factor register, and boundary statements aligned to reviewer expectations. ‍ Book a demo Guide Recent posts No items found. Join the industry leaders and solve your Scope 3 emissions data challenge See how DitchCarbon can transform your sustainability journey with auditable insights and verified data. v260319.2 enquiries@ditchcarbon.com+44 203 475 7875 Ditch Carbon Ltd 167-169 Great Portland Street London W1W 5PF Platform How it worksDataIntegrationsAuditabilityComparePricing Use Case AI Survey Responder Company Emissions Data for Financial Services Emissions Reporting Sustainable Sourcing: A Strategy for Decarbonisation Smarter Supplier Engagement: Reduce Burden, Drive Decarbonisation SBTi-Aligned Baselining Customers EssilorLuxottica Hikma Grant Thornton Haleon Coherent Howden Resources GuidesBlogIndustriesTrust centerUpload Ecovadis reportsUpload CDP responseCalculation methodologyClaim your profileSBTI APIFAQ Documentation HelpReferenceAppendixChangelog Company AboutContactCareersPrivacy policyTerms and conditions