Explainers

GHG inventory: a step-by-step guide to your first one

Leia em português → By Julia Santos · Updated Oct 1, 2026, 04:04 · ⏱ readable in 5 min

The minute

The inventory is the process; the footprint is the number it produces
Base year, boundary and method must be defined and written down before any data collection
Publish the method next to the result: that is what makes the number auditable next year

Why it matters: A company that changes method every year can never prove a reduction, because nothing is comparable to anything.

Which standard to follow

The GHG Protocol Corporate Standard, from WRI and WBCSD, is the de facto standard for corporate inventories. It covers seven gases (CO2, CH4, N2O, HFCs, PFCs, SF6 and NF3). In Brazil, the Brazilian GHG Protocol Programme, created in 2008 by FGVces and WRI with the Ministry of Environment, CEBDS and WBCSD, adapts the method to the national context, provides a calculation tool and runs the Public Emissions Registry. ISO 14064-1 covers the same ground in standards language and is often the reference when formal verification is involved.

An inventory follows the GHG Protocol accounting principles: relevance, completeness (include every source within the boundary), consistency, transparency and accuracy. Every method choice should be defensible against one of them.

Step by step: your first inventory

1. Set the base year

Pick the most recent year with complete, verifiable data, usually the last closed calendar year. Future reductions will be measured against it. Write down the recalculation rule too: significant structural changes, such as an acquisition, a divestment or the correction of a material error, require recalculating the base year so comparisons still hold.

2. Set the organisational boundary

Choose the consolidation approach: equity share, or control (financial or operational). List every site, legal entity and asset included. Under operational control, every site the company operates is in, even if it does not own it outright.

3. Set the operational boundary

Classify sources by scope. Scope 1 includes stationary combustion (boilers, generators), mobile combustion (owned fleet), process emissions and fugitive emissions such as refrigerant leaks. Scope 2 is purchased electricity, heat or steam. Scope 3 is everything else in the value chain, in 15 categories. In a first inventory, Scopes 1 and 2 are required under the GHG Protocol; for Scope 3, pick the most relevant categories.

4. Write the inventory plan

One or two pages with base year, boundaries, sources, data owners, emission factors to use and deadlines. It prevents arguments halfway through and becomes next year’s roadmap.

5. Collect activity data

Physical quantities first (litres, cubic metres, kWh, kilograms), spend data only where no physical data exists. Every line needs a source (invoice, meter, system), a date and an owner.

6. Calculate

Multiply each activity figure by the matching emission factor. In Brazil, use the national programme’s tool for fuels and the grid factor published by MCTI for electricity. The calculation itself is explained in how to calculate your company’s carbon footprint.

7. Run quality control

Compare with the previous year where possible, look for unexplained jumps, check units (kWh versus MWh is the classic error) and have a second person redo a sample of the calculations.

8. Report honestly

State what was left out and why. An inventory with declared gaps is worth more than a round number with no audit trail.

Data checklist by scope

Scope 1: fleet and generator fuel invoices, natural gas or LPG consumption, maintenance orders with refrigerant top-ups, industrial process data.
Scope 2: 12 electricity bills per metering point; free-market contracts and renewable energy certificates, if any.
Scope 3 (priority categories): purchasing report by category, freight invoices with weight and distance, travel agency report, waste volumes and destinations.

Example: a services firm with three offices

An engineering firm with three rented offices and ten company cars adopts operational control. Scope 1 covers petrol and ethanol for the fleet and refrigerant top-ups for the air-conditioning units. Scope 2 covers electricity at the three offices. For Scope 3 it picks business travel and employee commuting, the most relevant categories for a services business. The inventory plan records that ethanol has specific biomass treatment under the GHG Protocol and that other Scope 3 categories will be assessed in the second cycle.

Scope 2: the two methods

The GHG Protocol asks for Scope 2 to be reported under the location-based method, using the average grid factor, and, where contractual instruments exist, also under the market-based method, using the factor of the contract or energy certificate. Brazil has both: companies in the free energy market or holding renewable energy certificates should show both numbers side by side and explain the difference. Keep contracts and certificate retirement records with the inventory.

After the first inventory

The second cycle is what turns the inventory into a management tool. With two comparable years, a company can:

identify the sources that grew most, and why;
set reduction targets based on its own data rather than market averages;
extend Scope 3 to new categories, replacing spend-based estimates with activity or supplier data;
consider third-party verification if clients or investors ask for it.

Verification and publication

In year one, external verification is not required unless a client, a bank or a regulator asks for it. Companies that join the Brazilian programme can publish in the Public Emissions Registry and earn a seal: bronze for a partial inventory, silver for a complete inventory and gold for a complete inventory verified by an independent third party.

For large emitters in Brazil, verification stops being optional. Under Law 15,042/2024, installations above 10,000 tCO2e a year must submit a monitoring plan and an annual report assessed by an accredited inspection body (Articles 31 and 32). See what the SBCE changes for your company.

Common mistakes

Collecting before defining the boundary. The result is rework and data that does not fit.
Changing method without recalculating. The time series loses its meaning.
Mixing physical and spend data without saying so. Readers need to know what was measured and what was estimated.
Leaving the inventory with one person. If they leave, the method leaves with them. A written plan solves that.
Ignoring fugitive emissions. Refrigerant gases can have a far higher warming potential than CO2.

Frequently asked questions

Which standard should we follow?

The GHG Protocol is the de facto standard; ISO 14064-1 covers the same ground in standards language.

Do we need to audit the inventory?

Not in year one, unless a client, a bank or a regulator requires it. Third-party verification is a requirement for the gold seal in Brazil’s Public Emissions Registry.

How long does it take?

Scopes 1 and 2 can be done in days; Scope 3 takes weeks because it depends on third parties.

Is Scope 3 mandatory?

Under the GHG Protocol Corporate Standard, Scope 3 reporting is optional but recommended. In practice, clients and investors increasingly ask for the relevant categories.