Electricity — National Residual Mix Factor (Market-Based)

If your organisation buys GreenPower, surrenders LGCs or has signed a renewable PPA, the market-based method is where those investments finally show up in your numbers. But it cuts both ways: any electricity not covered by contractual instruments is assigned the national residual mix factor of 0.81 kg CO₂-e/kWh — higher than every location-based state factor in the country. Run the comparison yourself in a scope 2 market-based calculator.

The logic is fair enough: renewables that others have paid to claim can’t also lower your footprint. Strip those claimed attributes out of the grid, and what’s left — the residual mix — is dirtier than the physical average. For 2025–26 the residual mix factor is 0.81 kg CO₂-e/kWh (Table 2, NGA Factors 2025), with a paired scope 3 loss factor of 0.11 kg CO₂-e/kWh.

Quick Verdict

Australia’s national residual mix factor is 0.81 kg CO₂-e per kWh for 2025–26, published in Table 2 of the Australian National Greenhouse Accounts Factors 2025 (DCCEEW). Under the market-based scope 2 method it applies to any purchased electricity not covered by contractual instruments — GreenPower, voluntarily surrendered LGCs, or the renewable attributes of PPAs. Covered electricity is reported at the instrument’s attributes (typically zero); everything else takes 0.81. Because voluntarily claimed renewables are excluded, the factor sits above every location-based state factor, from Tasmania’s 0.20 to Victoria’s 0.78. A paired scope 3 factor of 0.11 kg CO₂-e/kWh covers network losses and is reported under scope 3. Organisations should disclose both market-based and location-based figures.

How to Calculate Market-Based Electricity Emissions

Emissions (kg CO₂-e) = Uncovered electricity (kWh) × 0.81

Uncovered electricity = total consumption minus kWh matched by GreenPower, surrendered LGCs or PPA attributes.

Worked Example 1: Household with no green products

Assume an average household consuming around 5,000 kWh a year (an illustrative assumption) with no GreenPower.

5,000 kWh × 0.81 kg CO₂-e/kWh = 4,050 kg CO₂-e

4.05 tonnes CO₂-e (Scope 2, market-based)

Worked Example 2: Business with 40% LGC coverage

A company consumes 500,000 kWh and voluntarily surrenders LGCs covering 200,000 kWh.

Uncovered electricity: 500,000 kWh − 200,000 kWh = 300,000 kWh

300,000 kWh × 0.81 kg CO₂-e/kWh = 243,000 kg CO₂-e

243 tonnes CO₂-e (Scope 2, market-based)

Worked Example 3: Corporate load with no instruments

A corporate group consumes 1 GWh (1,000,000 kWh) with no contractual instruments in place.

1,000,000 kWh × 0.81 kg CO₂-e/kWh = 810,000 kg CO₂-e

810 tonnes CO₂-e (Scope 2, market-based)

For the parallel location-based figure, apply your state factor to total consumption in a location-based calculator.

How the Residual Mix Compares to Location-Based Factors

Calculation Methodology: The Full Market-Based Method

The residual mix factor only makes sense inside the market-based method, so it is worth understanding the whole calculation as the NGA Factors 2025 sets it out.

The scope 2 and scope 3 components

Like the location-based factors, the residual mix comes in two parts that are reported separately: 0.81 kg CO₂-e/kWh (scope 2) for the generation emissions of the residual grid mix, and 0.11 kg CO₂-e/kWh (scope 3) for transmission and distribution losses. The residual mix is higher than every location-based state factor because renewable generation already claimed by others — through the Renewable Energy Target, surrendered LGCs and GreenPower — is stripped out before the factor is calculated. What remains is the grid you can actually lay claim to if you have bought no renewables yourself.

The market-based formula

The NGA Factors market-based equation is:

Y = ( (Q − Q_exempt) × (1 − (RPP + JRPP)) + Q_exempt × (1 − JRPP) − (REC_surr − REC_onsite) × 1,000 ) × (RMF1 + RMF2) ÷ 1,000

where:

• Q — electricity purchased and consumed (kWh)
• Q_exempt — any electricity exempt from Renewable Energy Target liability (kWh); zero for most organisations
• RPP — the RET Renewable Power Percentage, 18.195% for the 2025 financial year (average of the published 2024 and 2025 calendar-year percentages). Every grid consumer gets this reduction automatically.
• JRPP — the jurisdictional renewable power percentage. The ACT is currently the only jurisdiction with one: 80.32% for 2025–26, reflecting certificates the ACT Government surrenders on the territory’s behalf.
• REC_surr — eligible renewable energy certificates you voluntarily surrendered, in MWh. An eligible certificate is a Large-scale Generation Certificate (LGC) voluntarily surrendered with a generation date within 36 months of the end of the reporting year, or a purchase of accredited GreenPower.
• REC_onsite — LGCs created for on-site generation you consumed yourself, netted out to prevent double counting.
• RMF1 + RMF2 — the residual mix factors on this page: 0.81 + 0.11 kg CO₂-e/kWh.

How renewable purchases flow through

Each lever reduces the volume that gets multiplied by the residual mix:

• GreenPower: an accredited GreenPower purchase zero-rates the purchased volume — 100% GreenPower takes market-based scope 2 to zero.
• Corporate PPAs with LGC surrender: each voluntarily surrendered LGC zero-rates 1 MWh. This is the mechanism that makes renewable power purchase agreements visible in your accounts.
• On-site solar consumed behind the meter: never enters Q at all, so it carries no market-based emissions.
• Doing nothing: you still benefit from the RPP — roughly 18% of your consumption is treated as renewable because the RET procures it on everyone’s behalf.

Worked contrast with the location-based method

Take 1,000,000 kWh consumed in NSW with no renewable purchases:

• Location-based: 1,000,000 × 0.64 ÷ 1,000 = 640 t CO₂-e (Scope 2)
• Market-based: 1,000,000 × (1 − 0.18195) × 0.81 ÷ 1,000 ≈ 663 t CO₂-e (Scope 2)

The market-based figure is higher for a passive consumer — that is by design. The residual mix stops organisations claiming the grid’s average renewable share twice, and rewards only those who actually contract for renewables. The same consumption with 100% GreenPower reports 0 t CO₂-e market-based, while the location-based figure stays at 640 t.

Which method should you use?

Report both. NGER uses location-based factors, and the GHG Protocol Scope 2 Guidance — which AASB S2 builds on — expects dual reporting: location-based and market-based side by side. The market-based number is where your renewable procurement decisions become visible, which is exactly why it exists.

NGER and AASB S2 Reporting

NGER reporting introduced market-based scope 2 disclosure alongside the long-standing location-based method, and AASB S2 expects entities holding contractual instruments to present both figures with a clear methodology note. NetNada’s NGER reporting tool tracks instrument coverage and applies the residual mix factor to the uncovered remainder automatically.