Greenhouse gas emissions reporting by Local Authorities and other Scottish public bodies: Research into Scope 3 Group 3 emissions

Appendix C: Limitations of this approach

The research methodology has been designed to cast as wide a net as possible within the scope of the project, but inherently there is a risk of unusual Group 3 activities being missed. This section provides an overview of the limitations of this research.

Lack of sufficient detail in audited accounts to identify all products sold or distributed: The desk research included a review of local authorities’ audited financial accounts. As the accounts report revenue as aggregated categories and by service area, rather than by individual products or activities for financial reporting purposes, this study has been unable to identify specific examples of local authorities selling products. Furthermore, due to the nature of grants and funding in the public sector, the selling of products may be less evident in the audited accounts. For example, if a local authority is funding an ALEO that sells products, the revenue from those products may not return to the local authority, and instead the funding provided to the ALEO may decrease. This adds an additional consideration for local authorities when defining their organisational boundary for GHG emissions reporting if they are using a financial control approach.

Limited information about existing Scope 3 emissions in PBCCDRs: The desk research also included a review of all the PBCCDRs, in order to try to identify whether any Group 3 categories are already being reported. Here, the limitation is due to the reporting structure in the reports where emissions are classified as Scope 1, 2, or 3 but the specific Scope 3 category is not specified. This means that it was necessary for the research team to interpret the free text comment entered by the public bodies to identify possible Group 3 emissions that are already being reported. Nevertheless, this provided a good starting point to understanding the emissions that are already reported and examples that to discuss during the stakeholder engagement.

Sampling approach to stakeholder engagement: The stakeholders engaged in this research were identified with the support of Scottish Government and through the Sustainable Scotland Network steering group. The research team engaged with four local authorities (covering urban, rural and island local authorities) and seven other public body stakeholders. This engagement covered two NHS stakeholder groups, a college, a university, a cultural organisation, and two public bodies who were identified as selling products that would definitely be relevant to Group 3. With a relatively small sample size (11 interviews) there is a risk that the interviews did not engage all organisations with relevant Group 3 emissions, or did not include the people in the organisation who may be aware of Group 3 activities. There is also a risk of self-selection bias, as organisations or individuals who were more willing to participate may have had a greater interest in carbon reporting and may therefore have been more supportive of reporting additional emissions sources than the wider public body population.

Unclear organisational boundaries: During the stakeholder engagement, it became apparent that there is some uncertainty around the organisational boundary used in emissions reporting (i.e. financial control, operational control or equity share approach). This is especially important if the decision is made by Scottish Government to require the reporting of some Scope 3 categories and not others as the consolidation approach used impacts the Scope 3 category under which emissions are reported.

Challenges in understanding the scale of Group 3 activities taking place: Another area of uncertainty was the lack of clarity around the size or scale of Group 3 emissions discussed during the stakeholder engagement. Public bodies may have lacked the time and resources to undertake a screening exercise of Scope 3 emissions, instead focusing on reporting the categories currently required. However, such a screening exercise or materiality assessment by individual public bodies is especially important for Group 3 activities that are not relevant for many public bodies, but may be significant for a small number of organisations. This uncertainty was influenced by the considerable variation in data availability and management systems across organisations. Even among local authorities, there is substantial variability in the systems used to collect and manage data, which affects the ability to identify and quantify potential Group 3 emissions. Across the wider public body landscape, this variation is even greater because organisations undertake very different functions and activities. As a result, some public bodies have readily available data to assess Group 3 emissions, while others would need to undertake more detailed investigation before determining whether these emissions are material.