Spend-based method: Definition

The approach of quantifying GHG emissions through spending relies on taking the monetary value of a purchased product or service and multiplying it by an emission factor, representing the emissions generated per unit of currency spent. This process yields an approximation of the emissions generated.However, it’s important to note that spend-based methods base their emission factors on industry-average levels of greenhouse gas emissions. Consequently, these calculations might lack precision and specificity. For instance, if you were to purchase a chair, a spend-based approach would merely consider it as a furniture acquisition, without accounting for whether the chair was constructed from iron or wood. In contrast, activity data tends to offer greater reliability in emissions estimation.