Emission Factors Explained: What They Are, How They Work, and Why They Matter

Every greenhouse gas inventory — from a multinational corporation's Scope 3 disclosure to a small business's first carbon footprint — is built on the same foundation: emission factors. They are the numerical link between what you measure (activity data) and what you report (greenhouse gas emissions).

Understanding what an emission factor is, where it comes from, and why you might use a different one than someone in another country or industry is the foundation of credible GHG accounting. This article covers all of that, in plain language, with real examples.

What is an emission factor?

An emission factor is a coefficient that converts a unit of activity — litres of fuel burned, kilowatt-hours of electricity consumed, tonnes of material produced — into an equivalent quantity of greenhouse gas emissions, expressed in CO2-equivalent (CO2-e).

Think of it as a conversion rate. Just as you use an exchange rate to convert dollars to euros, you use an emission factor to convert litres of diesel into tonnes of CO2-e.

Emission factors are published by government agencies and research institutions based on measurement, modelling, and statistical analysis of real-world data. The major sources are Australia's NGA Factors, the UK's DEFRA GHG Conversion Factors, the US EPA Emission Factor Hub, and the global IPCC Emission Factor Database. For a comparison of these databases, see our guide to emission factor databases.

The formula: Emissions = Activity Data × Emission Factor

The GHG accounting formula is deceptively simple:

Activity data is what you measure: how much fuel you burned, how much electricity you purchased, how many kilometres your fleet drove, how many tonnes of freight you shipped. This data comes from meter readings, fuel receipts, logistics records, and procurement systems.

The emission factor is a published coefficient — expressed in units of CO2-e per unit of activity — that translates your activity data into emissions.

Emissions is the result, typically expressed in tonnes of CO2-e (tCO2-e).

The formula always works the same way. The skill lies in selecting the right emission factor for the right activity — which is why the rest of this article matters.

The three scopes of emissions

The GHG Protocol's corporate accounting standard — the framework underpinning almost every GHG reporting regime in the world — divides emissions into three scopes. Each scope has its own type of emission factor.

Scope 1 emission factors

Scope 1 factors convert fuel consumption or process activity into direct emissions. They are generally the most stable and scientifically well-established, because they are based on fuel carbon content — which doesn't change much from year to year. Examples: litres of natural gas burned, tonnes of coal combusted, tonnes of explosives detonated.

Scope 2 emission factors

Scope 2 factors convert purchased electricity (in kWh or MWh) into emissions attributable to that electricity consumption. These factors change significantly from year to year as the generation mix shifts. A grid that adds wind and solar capacity will have a lower emission factor the following year. State-level or regional factors are always more accurate than national averages for electricity. See our article on how to choose the right emission factor for the location-based vs market-based distinction that applies to Scope 2.

Scope 3 emission factors

Scope 3 is the most complex scope. There are 15 categories defined by the GHG Protocol, spanning everything from purchased goods and services (Category 1) to investments (Category 15). Emission factors for Scope 3 range from activity-based factors (spend per unit, distance per freight tonne-km) to more complex lifecycle-based factors from databases like Ecoinvent. DEFRA's GHG Conversion Factors include the broadest free Scope 3 coverage of any government-published database.

Why emission factors differ by region and year

The same activity — burning a litre of diesel, consuming a kilowatt-hour of electricity — can have a very different emission factor depending on where it happens and when. Here's why.

Geographic differences

Electricity grids vary enormously. Tasmania's grid is predominantly hydro — its Scope 2 emission factor is among the lowest in Australia. Queensland's grid still relies heavily on black coal, so its factor is much higher. Norway's grid is almost entirely hydro; Poland's remains coal-dominated. Using a national average where a regional factor exists always introduces error.

Fuel quality varies by jurisdiction. The carbon content of natural gas differs by field and pipeline network. Australian natural gas from certain fields has different methane content than UK North Sea gas. These differences are small but they add up at scale.

Supply chain structures differ. A Scope 3 spend-based factor for steel reflects the emission intensity of steel production in whatever region the steel was sourced from. Australian steel production has a different carbon profile than Chinese or European production.

Annual changes

Electricity emission factors are updated every year because grids change. The addition of new renewable capacity, the retirement of old coal plants, changes in hydro storage levels, shifts in gas use — all of these affect the emission intensity of the grid. In Australia, several state electricity factors have fallen by more than 10% in a single year during periods of rapid renewable buildout.

Fuel factors change more slowly but do change — driven by updates to global warming potentials (GWPs), changes in fuel composition standards, and improved measurement of fugitive emissions in the supply chain.

For a detailed breakdown of what changed in the 2025 editions of the major databases, see our 2025 emission factor updates article.

Using last year's electricity emission factor when this year's has been published isn't conservative — it's inaccurate. If the grid got cleaner, you're overstating your Scope 2 emissions. If it got dirtier, you're understating them. Best practice is to always use the most recently published factor set.

Where to find emission factors

The major free databases, all updated annually:

• Australia — NGA Factors (DCCEEW): The National Greenhouse Accounts Factors workbook. Required for NGER reporting; also the appropriate source for voluntary Australian GHG disclosures. Covers Scope 1, 2, and 3. State-level electricity factors included.
• UK — DEFRA GHG Conversion Factors: Published by the Department for Energy Security and Net Zero (DESNZ), universally known as "DEFRA factors." The most comprehensive free database for Scope 3 categories, and the standard for UK corporate reporting. Also widely used internationally.
• United States — EPA Emission Factor Hub: The US government's central repository. Covers stationary combustion, mobile combustion, purchased electricity (via eGRID), and Scope 3 categories.
• Global — IPCC EFDB: The IPCC Emission Factor Database. Used for national greenhouse gas inventory work and as a fallback when jurisdiction-specific factors don't exist for an activity.
• Global electricity — IEA: The International Energy Agency publishes country-specific electricity emission factors. Subscription required for detailed data.
• Lifecycle assessment — Ecoinvent: The reference database for LCA work. Licence fee required. Covers a much broader range of processes than any government database.

For a full comparison of these databases — including scope coverage, update frequency, cost, and when to use each — see our complete guide to emission factor databases.

Common misconceptions

"I can use any emission factor I find online"

Not quite. The factor must match your activity type, your jurisdiction, and your reporting scope. A UK DEFRA electricity factor applied to an Australian operation will significantly understate emissions — Australia's grid is substantially more carbon-intensive than the UK's. Always match the factor to the geography and the activity.

"Last year's factors are close enough"

For fuel combustion factors, this is often true — they're relatively stable. For electricity factors, it is frequently not. A factor that's 10% different from last year — which is common for rapidly decarbonising grids — introduces a 10% error into your Scope 2 calculation. At scale, that's not a rounding error.

"Scope 3 factors are too uncertain to use"

Scope 3 emission factors carry more uncertainty than Scope 1 factors — that's acknowledged and well-documented. But "uncertain" doesn't mean "useless." A spend-based Scope 3 factor with ±30% uncertainty still gives you an order-of-magnitude estimate that is far better than nothing, and sufficient to identify which categories are material enough to warrant more detailed measurement. The GHG Protocol explicitly endorses the use of secondary data (including published emission factors) for Scope 3 where primary data isn't available.

"CO2 and CO2-e are the same thing"

They are not. CO2 refers only to carbon dioxide. CO2-e (CO2-equivalent) aggregates all greenhouse gases — CO2, methane (CH4), nitrous oxide (N2O), refrigerants, and others — into a single number using global warming potentials (GWPs). Methane, for example, has a GWP of approximately 28-36 (AR5) over 100 years, meaning 1 tonne of methane equals roughly 28-36 tonnes CO2-e. Most emission factors are expressed in CO2-e to capture this full picture.

"I need separate factors for every gas"

Usually not. Most published emission factors are already expressed in CO2-e, meaning the database has done the work of combining CO2, CH4, N2O (and any other gases) for you, weighted by their GWPs. When you use the NGA diesel combustion factor, for example, it already includes the CO2, methane, and N2O components of diesel combustion, combined into a single CO2-e coefficient.

Frequently asked questions

What is an emission factor?

An emission factor is a number that converts a unit of activity — litres of fuel, kWh of electricity, km of travel — into an equivalent quantity of greenhouse gas emissions expressed in CO2-equivalent. It's used in the formula: Emissions = Activity Data × Emission Factor.

How do I know which emission factor to use?

Match the factor to your jurisdiction, your reporting framework, and your activity type. For Australian NGER reporting, use NGA Factors. For UK corporate disclosures, use DEFRA. For US reporting, use the EPA Hub. For activities where no jurisdiction-specific factor exists, fall back to IPCC defaults. For a full decision framework, see our guide on how to choose the right emission factor.

What is the difference between CO2 and CO2-e?

CO2 refers to carbon dioxide only. CO2-e (CO2-equivalent) is a composite measure that converts all greenhouse gases into their equivalent warming effect relative to CO2, using global warming potentials (GWPs). Methane has a GWP of approximately 28-36, so 1 tonne of CH4 = 28-36 tCO2-e. Most emission factors are expressed in CO2-e.

Why do emission factors change every year?

Because the real-world systems they represent change. Electricity grids add renewable capacity. Fuel supply chains shift. Better data becomes available. The databases that publish emission factors update them annually to reflect these changes. Using outdated factors introduces avoidable error into your inventory.

Do I need different factors for Scope 1, 2, and 3?

Yes. Each scope has its own type of factor. Scope 1 factors are based on fuel combustion chemistry. Scope 2 factors depend on the electricity grid's generation mix. Scope 3 factors reflect supply chain, lifecycle, and economic data. The same database may publish all three, but they are distinct and must be applied to the correct scope.