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In 2025, carbon dioxide equivalent (CO₂e) has become a cornerstone metric in sustainability reporting. As businesses worldwide strive to meet stringent Environmental, Social, and Governance (ESG) standards, understanding CO₂e is crucial for accurate greenhouse gas (GHG) accounting and climate strategy development. This guide delves into the nuances of CO₂e, offering insights into its calculation, global emission trends, and practical applications for businesses.
Understanding CO₂ vs. CO₂e: What’s the Difference?
CO₂ (Carbon Dioxide) is a single greenhouse gas, primarily emitted through fossil fuel combustion, industrial processes, and deforestation. It is the most abundant greenhouse gas produced by human activities and serves as the benchmark for comparing the impact of other greenhouse gases.
CO₂e (Carbon Dioxide Equivalent), on the other hand, is a broader metric. It aggregates the effects of various greenhouse gases — such as methane (CH₄), nitrous oxide (N₂O), and fluorinated gases — into a single unit based on their relative global warming potentials (GWP) compared to CO₂. This approach simplifies reporting and helps policymakers and businesses prioritize actions.
While CO₂ specifically measures only carbon dioxide, CO₂e provides a comprehensive view of a company’s or a country’s total greenhouse gas emissions. For instance, methane has a GWP 25 times greater than CO₂ over 100 years, meaning that one ton of methane has the same climate impact as 25 tons of CO₂. Therefore, the CO₂e calculation enables a more accurate assessment of environmental impact.
Exemple: Emitting 1 ton of CH₄ is equivalent to emitting 25 tons of CO₂, hence 25 tons CO₂e.
| Gaz | Global Warming Potential (100 years) |
| CO₂ | 1 |
| CH₄ | 25 |
| N₂O | 298 |
Key Differences:
- Champ d'application : CO₂ measures carbon dioxide alone; CO₂e includes all major greenhouse gases.
- Objet : CO₂e is used for comprehensive climate impact assessments.
- Application: ESG reporting, carbon accounting, carbon trading mechanisms, and regulatory compliance standards prefer CO₂e for its holistic view.
Understanding this distinction is essential for accurate Inventaires des GES, sustainability strategy development, and meeting climate disclosure requirements.
The CO₂e Calculation Formula: A Step-by-Step Guide
Calculating CO₂e involves converting various GHG emissions into their CO₂ equivalents using their respective GWPs. The general formula is:
CO₂e = Σ (Mass of GHG × GWP of GHG)
Where:
- Mass of GHG is the amount of each greenhouse gas emitted.
- GWP of GHG is the global warming potential of each gas relative to CO₂.
Exemple: If a company emits 2 tons of CH₄ and 1 ton of N₂O:
- CH₄: 2 tons × 25 (GWP) = 50 tons CO₂e
- N₂O: 1 ton × 298 (GWP) = 298 tons CO₂e
- Total CO₂e = 50 + 298 = 348 tons CO₂e
This calculation allows businesses to aggregate diverse GHG emissions into a single, comparable metric.
Updated CO₂e Emission Factors for 2024
Emission factors are constantly evolving based on scientific advancements. The IPCC’s Sixth Assessment Report (AR6) has updated global warming potentials, impacting how companies must calculate emissions.
For example [1] [2]:
- Methane (CH₄): The 100-year GWP for methane has been updated to 27.0 for non-fossil sources. For fossil methane, which includes additional effects from oxidation to CO₂, the GWP is 29.8.
- Nitrous Oxide (N₂O): The GWP has been adjusted to 273 over a 100-year time horizon.
Businesses must ensure they use the latest GWP values and update their internal carbon accounting methodologies annually. Failure to do so can result in outdated reports, misaligned ESG disclosures, and reputational risks.
CO₂e Emission Factors and Conversion Tools
Facteurs d'émission are coefficients that estimate the emissions associated with specific activities, such as fuel combustion or industrial processes.
Key Sources for Emission Factors:
- Intergovernmental Panel on Climate Change (IPCC)
- U.S. Environmental Protection Agency (EPA)
- UK Government (DEFRA)
Conversion Tools like the EPA’s Greenhouse Gas Equivalencies Calculator help translate CO₂e emissions into relatable terms, such as the equivalent number of cars on the road or households’ energy use.
Global CO₂e Emissions by Country: 2024 Snapshot
In 2024, China leads the world in carbon dioxide equivalent emissions, contributing 12.3 billion tons CO₂e. The United States follows with 5.29 billion tons, while India, Russia, and Indonesia contribute 3.17 billion, 1.8 billion, and 1.48 billion tons CO₂e, respectively. These countries, along with Brazil, Japan, Iran, Canada, and Saudi Arabia, represent a major portion of global greenhouse gas emissions, underlining the scale and urgency of the climate challenge. [3]
Such substantial emission levels from key economies emphasize the critical need for united global efforts. Advancing climate action, fostering international cooperation, and driving innovation in clean technologies are more vital than ever to achieving sustainability goals and combating the intensifying impacts of climate change.
How CO₂e Impacts Corporate Climate Goals
CO₂e is central to corporate decarbonization targets. Companies setting Science-Based Targets (SBTi) must measure and reduce their CO₂e emissions across Scope 1, 2, and 3.
For instance:
- Microsoft aims to become carbon negative by 2030, targeting absolute CO₂e reductions across operations and supply chain. [4]
- Unilever integrates CO₂e goals into product design, aiming for net-zero emissions by 2039. [5]
Accurate CO₂e tracking ensures alignment with the Paris Agreement and enhances credibility with stakeholders and investors demanding transparency.
Practical Applications: CO₂e in Business Strategy
Effectively leveraging CO₂e calculations can transform a company’s sustainability profile and unlock new opportunities in a carbon-conscious economy. From compliance to investment attractiveness, understanding practical applications is critical to achieving long-term ESG success.
- ESG Reporting and Compliance: Companies are increasingly required to disclose their GHG emissions in CO₂e terms to comply with regulations like the EU’s CSRD and the SEC’s climate disclosure rules.
- Carbon Footprinting: Calculating the CO₂e of products or services helps businesses identify emission hotspots and develop strategies to reduce their carbon footprint. For instance, a pair of sneakers may have a carbon footprint of 14 kg CO₂e, factoring in raw materials, manufacturing, transportation, and end-of-life disposal. [6]
- Supply Chain Management: Assessing the CO₂e emissions across the supply chain enables companies to engage suppliers in emission reduction initiatives.
- Investment and Risk Assessment: Investors use CO₂e data to evaluate companies’ climate-related risks and opportunities.
Case Study: Japan’s Emission Reduction Success
In the fiscal year 2023/24, Japan achieved a 4% reduction in greenhouse gas (GHG) emissions compared to the previous year, reaching a record low of 1.071 billion metric tons of CO₂e, according to the Environment Ministry. [7]
This marks the lowest level of emissions since Japan began compiling comparable data in fiscal year 1990/91.
The decline was mainly driven by:
- Lower energy consumption due to a mild winter,
- Increased use of renewable energy,
- And the restart of nuclear power plants.
Japan’s progress highlights how strategic energy policies, renewable expansion, and nuclear utilization can contribute significantly to national emissions reductions, even while sustaining economic activities.
Seneca ESG’s Smart Solutions for a Sustainable Future
Reducing environmental impact requires both individual action and innovative business solutions. We believe that lessening emissions doesn’t have to be complicated. With the right tools and insights, companies can make sustainability both achievable and actionable. That’s why we’re excited to introduce AÉRONEF our innovative solutions designed to simplify and empower your journey toward a greener future.
AÉRONEF is our comprehensive carbon accounting tool that streamlines émissions de gaz à effet de serre (GES) tracking and reporting. Key features include:
- Global Compliance: Ensures your data aligns with the Greenhouse Gas Protocol, ISO 14064 standards, and more.
- Automated Emission Calculations: Simplifies tracking for Scope 1, 2, and 3 emissions, reducing the need for manual intervention.
- Extensive Emission Data: Access a robust database of up-to-date emission factors to pinpoint and address your environmental impact effectively.
Want to learn more about how AERA can help your business cut its carbon footprints and drive actionable sustainability? Get in touch with us today and discover how our innovative tools are paving the way for a sustainable future.
Final thoughts
As the global community intensifies efforts to combat climate change, understanding and utilizing CO₂e metrics becomes imperative for businesses. Accurate CO₂e calculations enable organizations to measure, report, and reduce their GHG emissions effectively, aligning with international climate goals and enhancing corporate sustainability.
Businesses should invest in robust GHG accounting systems, stay informed about evolving emission factors, and engage stakeholders in emission reduction initiatives. By embracing CO₂e metrics, companies can play a pivotal role in the transition to a low-carbon economy.
Références :
[2] https://ghginstitute.org/2024/10/17/which-methane-gwp-value-do-i-use/
[5] https://exponentialroadmap.org/unilevers-journey-toward-net-zero-value-chain-emissions-by-2039/
[6] https://dspace.mit.edu/bitstream/handle/1721.1/102070/Olivetti_Manufacturing-focused.pdf
