How businesses can track carbon emissions

Why IT leaders must track carbon emissions

A clear view of the organization's carbon footprint can help IT leaders recognize and manage its environmental impact.

"Without credible, activity-level carbon data, IT leaders are effectively blind to where emissions are being created and where reductions can be achieved without compromising performance or security," said Sofia Peruzzo, group environmental, social and governance (ESG) manager at SK tes.

However, an organization's carbon footprint has implications for IT ops and the overall business strategy, making it a business imperative as well as a sustainability practice.

"When emissions associated with IT are measurable and visible, leaders can manage them like any other input, reducing waste, lowering energy costs and making more informed technology decisions," said Steve Wilhite, executive vice president at SE Advisory Services. "At the same time, expectations around Scope 2 reporting under the Greenhouse Gas Protocol are increasing, with proposed updates pushing companies toward more granular and auditable clean electricity claims."

Emissions tracking is essential for organizations for several reasons, including the following:

• Compliance. Failing to track carbon emissions poses a compliance risk. Rules and regulations, such as the EU's Corporate Sustainability Reporting Directive, require organizations to track and report their sustainability efforts, including emissions. In certain regions, such as California, the U.S. Securities and Exchange Commission requires disclosures on emissions, how climate change is affecting business strategy and how businesses mitigate climate risks.
• Executive pressure. Pressure to track carbon emissions can also come from board members and investors. ESG metrics are a key part of corporate reporting and influence board-level decision-making, so more and more boards are requiring reporting and transparency around ESG initiatives.
• Budgets. Not tracking emissions carries indirect financial implications, especially as businesses continue to tighten budgets amid a volatile economy. When emissions are tracked, organizations can get a better picture of how much money is being spent and make more informed decisions on how to manage costs.
• Competitive advantage. Sustainability and similar ESG initiatives are becoming a key differentiator for organizations to align with consumer and investor values. Being transparent about sustainability practices and sharing emissions reporting can build trust with stakeholders and customers.

Understanding IT's carbon footprint

Information about IT's carbon footprint can help leaders track and manage emissions more efficiently and effectively.

"A company's carbon footprint is a company-wide accounting framework similar to financial accounting, where every function plays a role in contributing to and mitigating carbon emissions," said Saskia van Gendt, chief sustainability officer at Blue Yonder. "These efforts can't live in a silo with only the sustainability team, and more companies are recognizing this."

Although IT's carbon footprint is multifaceted and can vary by organizational needs, IT leaders should understand several key factors to accurately track their emissions.

Scope 1, 2, and 3 emissions

There are three scopes of emissions based on their sources. They are the following:

• Scope 1. Scope 1 refers to emissions from company-owned sources. For IT teams, Scope 1 emissions might include on-site generators or data centers that use fossil fuels.
• Scope 2. Scope 2 includes indirect emissions that come from purchased energy, such as electricity, heat or steam. Scope 2 emissions can include electricity used to power servers and equipment, as well as electricity generated by external sources for data centers.
• Scope 3. Scope 3 includes all other indirect emissions not included in Scope 2, such as equipment transportation, energy from cloud or SaaS providers and disposal of electronic waste. Scope 3 is typically the most complex category of emissions and can account for most of an IT team's emissions.

"Sustainability efforts confined to a single team won't make meaningful progress, especially considering Scope 3 emissions that are indirect and generated throughout the company's supply chain and product lifecycle," van Gendt said.

End-user devices vs. data centers

Since the rise of AI, data centers have been a hot-button issue for their environmental impact and high energy consumption. As AI use grows, data centers are increasingly power-hungry, accounting for a significant portion of an organization's carbon footprint.

"End-user devices represent a significant embedded emissions footprint, with most emissions generated during manufacturing rather than use," Peruzzo said. "Decisions around device lifespan, reuse, redeployment and responsible end‑of‑life processing therefore materially affect Scope 3 outcomes."

Cloud and hybrid infrastructure

As more organizations move away from on-site infrastructure toward cloud and hybrid set-ups, they must consider how these providers affect their carbon footprints.

However, tracking these types of emissions typically falls under Scope 3 because they come from service providers, which can make tracking more complex.

Tools to track carbon emissions

Finding the right carbon emissions tracking software to accurately and seamlessly monitor emissions is critical to this strategy.

"Dashboards and reporting don't drive progress on their own. People do," Peruzzo said. "Carbon data becomes powerful when IT teams can clearly see how extending the life of devices, improving reuse rates or changing disposal practices directly reduces emissions and supports wider ESG and sustainability goals."

Carbon Monitor

Carbon Monitor offers updated data daily on global carbon emissions for benchmarking and analysis.

Key features:

• Daily emissions tracking.
• Sector analysis.
• Historical comparisons.

Deployment: Web-based.

Pricing: Free.

Climate TRACE

Climate TRACE is a global emissions tracker that uses satellite and ground-based data, along with AI, to track emissions and estimate reductions across industries and geographies.

Key features:

• Independent monitoring and verification of emissions worldwide.
• Public data access.
• Sector-level emissions breakdowns.

Licensing: Public, web-based platform.

Pricing: Free.

IBM Environmental Intelligence Suite

IBM's Environmental Intelligence Suite is a cloud-based sustainability platform that monitors and assesses climate risks, manages emissions and prepares for environmental disruptions through AI and data analysis.

Key features:

• Carbon emissions tracking across scopes.
• Climate risk modeling.
• Carbon forecasting based on current usage, climate trends and operational factors.

Licensing: SaaS.

Pricing: Tiered subscriptions start at $500 for essential features. Free trial available through IBM.

Microsoft Cloud for Sustainability

Microsoft Cloud for Sustainability is a suite of data and AI products, including Microsoft Sustainability Manager, Emissions Impact Dashboard and Environmental Credit Service. It can track, analyze and manage environmental impact.

Key features:

• Data integration with Microsoft Azure and external systems.
• Emissions dashboards that centralize data across scopes and operations.
• Sustainability forecasting using what-if analysis.
• Upcoming Microsoft Copilot integration for smarter analytics, report generation and data querying.

Licensing: SaaS.

Pricing: Subscription-based, tiered based on features and usage. Free trial available for certain features.

Watershed

Watershed is an enterprise sustainability AI platform designed to measure, report and reduce carbon emissions across scopes.

Key features:

• Emissions tracking and modeling for Scopes 1, 2 and 3, as well as other critical ESG metrics.
• Supplier engagement tools and Scope 3 monitoring.
• Reporting engine aligned with regulatory frameworks.
• Partnership with EvoVadis to improve supplier data collection and close the Scope 3 data gap.

Licensing: SaaS.

Pricing: Custom enterprise pricing starts around $30,000 annually.

Implementation best practices

Tracking carbon emissions consistently and accurately requires the right tool based on specific sustainability needs, as well as a commitment to embedding carbon tracking practices into the organization.

"A practical starting point is to establish a clear baseline for IT-related emissions and embed it into day-to-day operations," Wilhite said. "Begin by defining what IT is responsible for measuring across Scope 1, Scope 2 and Scope 3. Then consolidate existing data from IT and facilities, including electricity consumption, cloud usage reports, hardware purchasing and asset inventories."

To best track emissions, IT leaders should focus on the following best practices:

• Streamlined data collection. Leaders should follow, and make sure their teams follow, data collection best practices, including establishing reliable data sources, standardizing and centralizing data, and ensuring emissions data can integrate into financial systems.
• Data automation. Automate data captures and use real-time monitoring tools when possible for efficient carbon tracking with less manual effort.
• Hybrid tracking. Track emissions across both cloud and on-premises resources and link emissions to specific business units and departments.
• Measure actionable data. Focus on metrics to inform business decisions, such as carbon cost per workload. "Use these insights to inform everyday decisions such as right-sizing workloads, improving utilization, extending device life where appropriate and setting purchasing standards that favor more efficient and transparent options," Wilhite said.

Alison Roller is a freelance writer with experience in tech, HR and marketing.