Top 10: Scope 2 Emission Reduction Strategies

As global expectations for climate action intensify, corporations are finding their energy use under the spotlight like never before.

While most companies see the bulk of their emissions in Scope 3, Scope 2 emissions make up a substantial share of many organisations’ carbon footprints, as well as a notable operational cost.

Cutting these emissions has evolved beyond a question of corporate social responsibility; it is now a critical strategic priority.

The methods companies employ are evolving rapidly. Where initial initiatives focused on simple offsetting, today’s frontrunners are embedding sustainability into their core operations, shaping energy markets and fostering breakthrough innovation.

10. Grid Modernisation Advocacy & Partnerships

Featured Company: Ørsted

HQ: Fredericia, Denmark

CEO: Rasmus Errboe

FY Revenue: US$10.8bn (FY2024)

Achieving significant Scope 2 emissions reductions is often limited by current grid infrastructure and regulatory frameworks. Leading companies are addressing these barriers by engaging in policy advocacy and forming strategic partnerships to drive grid modernisation and decarbonisation. This includes championing supportive policies, investing in technologies such as energy storage, and collaborating with utilities and grid operators.

Ørsted, a global offshore wind leader, exemplifies this approach. By developing large-scale renewable projects that require advanced grid integration, Ørsted’s advocacy and innovation help shape a cleaner energy system—reducing grid carbon intensity and supporting both location-based and market-based Scope 2 solutions.

9. Building Electrification (Renewable Heating/Cooling)

Featured Company: Microsoft Corporation

HQ: Redmond, Washington, US

CEO: Satya Nadella

FY Revenue: US$245.1bn (FY2024)

Decarbonising buildings goes beyond reducing electricity consumption—it requires transforming heating and cooling systems that typically depend on fossil fuels like natural gas.

Electrification replaces these systems with high-efficiency electric alternatives, such as heat pumps, powered by renewable energy. This approach cuts on-site (Scope 1) emissions from burning fuels and lowers Scope 2 emissions from purchased heat or inefficient electric systems.

Microsoft’s ambitious goal to be carbon negative by 2030 and achieve zero operational emissions by 2040 is driving a comprehensive electrification of its global building portfolio, including data centres and campuses. This strategy is central to Microsoft’s broader sustainability commitment, which also includes transitioning to 100% renewable energy by 2025 and investing in innovative carbon removal technologies.

8. Renewable Thermal Energy

Featured Company: Siemens AG

HQ: Munich, Germany

CEO: Roland Busch

FY Revenue: US$86.5bn (FY2024)

While electricity is often the focus of Scope 2 emissions, thermal energy—used for industrial processes, steam generation and space heating—remains a significant emissions source, especially in manufacturing. Decarbonising this thermal demand is essential for deep emissions cuts, but it presents unique technical and operational challenges.

Key solutions include switching from fossil fuels to renewables such as biomass boilers, solar thermal collectors, geothermal heat pumps, renewable natural gas and green hydrogen. Each technology offers sector-specific advantages and requires tailored implementation.

Siemens, a leader in industrial automation and energy systems, is helping drive this transition. The company’s DEGREE framework sets ambitious decarbonisation targets, including net zero operations by 2030, and covers both electricity and thermal energy use within its facilities and supply chain

7. Direct Investment in Off-site Renewables

Featured Company: Amazon

HQ: Seattle, Washington, US

CEO: Andy Jassy

FY Revenue: US$638bn (FY2024)

Some corporations are going beyond standard PPAs by directly investing in off-site renewable energy projects, providing early-stage funding or taking equity stakes. This deeper involvement offers greater control and supports projects in challenging markets or new technologies but requires higher capital and risk.

Amazon exemplifies this approach through its US$2bn Climate Pledge Fund, backing sustainable tech and renewable energy. With more than 600 projects worldwide—including in India, Poland, and agrivoltaics—Amazon leads in corporate renewable investments, driving clean energy growth and innovation globally.

6. 24/7 Carbon-Free Energy (CFE) Procurement

Featured Company: Google (Alphabet Inc.)

HQ: Mountain View, California, US

CEO: Sundar Pichai

FY Revenue: US$350bn (FY2024)

24/7 Carbon-Free Energy (CFE) is redefining corporate renewable energy leadership by ensuring every kilowatt-hour of electricity consumption is matched with carbon-free sources, every hour of every day—far surpassing the traditional annual matching approach. This strategy directly addresses the intermittency of renewables like wind and solar, enabling continuous clean energy use and accelerating the journey to a fully decarbonised electricity system.

Google has been a pioneer in this space, committing to achieve 24/7 CFE across all its data centres and offices by 2030. Realizing this vision requires advanced hourly tracking tools, such as Time-based Energy Attribute Certificates (T-EACs), a diversified portfolio including firm clean power like geothermal, robust energy storage, and strong policy advocacy. 

In 2023, Google reported a global average CFE score of 64%, underscoring both progress and the scale of the challenge.

5. Utility Green Tariffs / Programmes

Featured Company: Starbucks

HQ: Seattle, Washington, US

CEO: Brian Niccol

FY Revenue: US$36.2bn (FY2024)

For companies aiming to simplify renewable energy procurement, utility green tariffs and programmes present a practical alternative to negotiating complex power purchase agreements (PPAs). These tariffs enable businesses to buy renewable electricity—often bundled with Energy Attribute Certificates (EACs) or Renewable Energy Guarantees of Origin (REGOs)—directly from their local utility. The structure and availability of these offerings depend on the utility and local regulations.

Starbucks exemplifies effective use of such programmes. In Washington, it participates in Puget Sound Energy’s “Green Direct” tariff, powering many stores with locally sourced renewable energy. In Illinois, Starbucks subscribes to community solar projects, partnering with providers like Nexamp to support local solar initiatives while receiving renewable energy credits for its stores.

Green tariffs represent a crucial middle ground, requiring supportive regulation and utility innovation to expand.

4. On-site Renewable Generation

Featured Company: Apple

HQ: Cupertino, California, US

CEO: Tim Cook

FY Revenue: US$391bn (FY2024)

Generating renewable energy on-site is a powerful strategy for companies aiming to cut Scope 2 emissions and visibly demonstrate climate leadership. By installing rooftop solar panels, wind turbines, or biogas fuel cells at their own facilities, organisations can directly replace grid electricity with clean power, increasing energy independence and potentially lowering costs. This approach also sidesteps the complexities of grid accounting and market-based instruments, offering a straightforward path to decarbonisation.

Apple provides a leading example, powering its global operations—including data centres and the Apple Park headquarters—with 100% renewable energy, much of it generated on-site. Apple Park’s 17-megawatt rooftop solar array, one of the world’s largest, is complemented by biogas fuel cells, showcasing the scale and impact of on-site generation.

While the emissions from owned generation fall under Scope 1, the clean power produced directly reduces the need for Scope 2 energy purchases.

3. Unbundled Energy Attribute Certificates (EACs/RECs/GOs)

Featured Company: Unilever

HQ: London, UK

CEO: Fernando Fernandez

FY Revenue: US$66.5bn USD (FY2024)

Energy Attribute Certificates (EACs) verify that one megawatt-hour (MWh) of renewable energy has been generated and added to the grid. Known as RECs in North America, GOs in Europe, and I-RECs internationally, they let companies match their electricity use with renewable generation, especially where direct sourcing like PPAs isn’t feasible.

Unilever uses EACs to meet its goal of 100% renewable energy by 2030, purchasing certificates when direct procurement isn’t possible. While EACs are accepted under market-based Scope 2 accounting, their true impact—‘additionality’—is debated. This drives demand for higher-quality certificates based on project age and location and prompts updates to greenhouse gas accounting guidelines.

EACs remain a flexible, recognised tool for companies to support renewable energy claims as the market shifts toward greater transparency and impact.

2. Power Purchase Agreements (PPAs)

Featured Company: Amazon.com, Inc.

HQ: Seattle, Washington, US

CEO: Andy Jassy

FY Revenue: US$638bn (FY2024)

Power Purchase Agreements (PPAs) have become a cornerstone for corporations aiming to secure renewable electricity and deliver on ambitious decarbonisation targets. These long-term contracts—often lasting 10 to 25 years—enable companies to buy clean energy directly from wind or solar developers, typically at a stable, fixed price.

PPAs are instrumental in driving new renewable capacity by giving developers the financial certainty needed to build additional projects, directly addressing the challenge of ‘additionality’ that some other mechanisms face. For corporate buyers, PPAs offer cost predictability, protection against energy price volatility, and a clear pathway to reduce Scope 2 emissions under the GHG Protocol’s market-based accounting method.

Amazon stands out as the world’s largest corporate purchaser of renewable energy, leveraging PPAs to power its global operations and data centres. The company strategically focuses on regions with higher grid carbon intensity to maximise emissions reductions, enabling hundreds of renewable projects worldwide.

1. Energy Efficiency Programmes

Featured Company: Walmart Inc.

HQ: Bentonville, Arkansas, US

CEO: Doug McMillon

FY Revenue: US$681bn (FY2025)

Energy efficiency is the bedrock of Scope 2 emissions reduction. By implementing measures to simply use less purchased energy – whether electricity for lighting and equipment, or thermal energy for heating and cooling – companies can achieve significant cuts in both their carbon footprint and operational costs. 

This strategy is universally applicable across all sectors, from retail giants to heavy industry, and is consistently recommended as the most cost-effective first step. 

Retail behemoth Walmart exemplifies this approach, prioritising efficiency in new store designs, upgrading legacy equipment and deploying technology to monitor and optimise energy consumption in its vast network of buildings.

Walmart’s Project Gigaton initiative further extends this focus, actively encouraging suppliers to adopt energy-saving practices. Reducing energy demand directly lowers emissions calculated under both the location-based and market-based Scope 2 accounting methods, making it a fundamental and unambiguous reduction lever.

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