Accounting for Downstream Scope 3 Product Use Phase Impacts: Calculating Residual Mix and Standard Delivery Clean Energy
“Multinational technology companies needed reliable residual mix data to support clean energy claims tied to product electricity use after sale across international markets.”
The Challenge
Companies want to understand and report on the electricity emissions associated with how their customers use their products. The challenge is that the availability of accurate residual mix data, the unclaimed, unattributed electricity on the grid, varies widely across the U.S. and international markets and is often incomplete or lacks consistency. In addition, data to accurately calculate standard delivery clean energy, the clean portion of the default electricity provided by a utility, is also elusive. Without a reliable methodology, companies cannot make credible downstream clean energy claims or accurately estimate Scope 3 product use-phase emissions.
How CRS Advisory Services Responded
Project 1 – Downstream Scope 3:
A multinational technology company needed reliable residual mix data to support clean energy claims tied to product electricity use after sale in the U.S. and Europe.
CRS performed residual mix and standard delivery clean energy (SDCE) analyses to support its downstream accounting needs, allowing the company to purchase RECs for the non-clean portion of its customers’ product electricity use. CRS researched disclosure programs across the U.S. and evaluated European residual mix data in order to deliver a residual mix hierarchy dataset and methodological report applicable to the company’s Scope 3 inventory.
This gave the company a credible way to estimate its downstream electricity emissions and make clean energy claims associated with product use.
Project 2 – Global Downstream Scope 3:
A U.S.-based multinational information technology company faced a similar challenge, though on a more global scale.
This company needed a consistent methodology to estimate electricity emissions from products sold across international markets, where electricity generation mixes, tracking systems, and residual mix data vary by country. CRS provided technical consulting to support the development of its Electricity Strategy Document and downstream emissions accounting framework. CRS created a custom market-based methodology allowing the company to estimate low-carbon electricity use across their supply chain and accurately report emissions. CRS also created fallback methodologies for markets where country-specific data was limited.
The result was a globally applicable framework of residual mix factors by country and a hierarchy of data, enabling the company to estimate the carbon intensity of the electricity used by its products and support consistent Scope 3 Category 11 accounting across its international markets.
The Outcomes
In both cases, CRS was able to qualify inconsistent and opaque data sources and create structured, practical methodologies for these two companies’ Scope 3 emissions accounting. Both clients came away with credible approaches for downstream Scope 3 electricity accounting and the confidence to make credible clean energy purchases for their products throughout their use phase.
Whether the challenge is navigating U.S. state-level programs or dozens of international markets, CRS brings the technical depth to provide credible, actionable solutions on residual mix and standard delivery clean energy so companies can meet their decarbonization goals.
Utility Residual Mix and Standard Delivery Clean Energy
“Three electric utilities needed independent third-party verification of their internal residual mix calculations to verify the accuracy of disclosures made to their customers, both on an annual reporting and hourly basis.”
The Challenge
Utilities and energy service providers are increasingly offering voluntary clean electricity products to their customers, the credibility of which depends on rigorous, independent verification. Without a structured verification framework, buying customers face uncertainty about the legitimacy of their product.
How CRS Advisory Services Responded
While CRS’s Green-e® Energy program is the leading certification in the U.S., CRS’s Advisory Services verifies additional types of data domestically and internationally, including calculating residual mixes, matching hourly generation to load, and disclosing accurate emissions rates, which all require careful accounting.
In this instance, a federally owned electric utility corporation calculated its own residual mix internally but needed independent third-party verification to ensure the accuracy of disclosures made to a large voluntary renewable electricity customer. CRS conducted an independent review of the utility’s residual mix data, including hourly and annual generation information, REC inventories, and calculation methodologies. CRS then developed a verification protocol to confirm that fuel mix and emissions calculations used in customer disclosures were accurate. The result was an audit protocol that CRS can then use to credibly verify the residual mix calculations.
In a separate case, an investor-owned utility needed a credible approach for disclosing the electricity resource mix and emissions rates for its green tariff products on an hourly basis. CRS reviewed the utility’s product design and energy accounting systems, then developed a verification protocol for independent auditors. The utility now has a structured framework to validate its electricity product claims.
In a third example, a municipal electric utility that ran a program offering its customers voluntary renewable and carbon-free electricity needed independent validation that their program’s claims were backed by real supply. CRS evaluated its program by reviewing generation facilities, procurement records, and sales. CRS then developed an audit protocol to verify that sufficient renewable electricity or RECs were purchased to meet customer demand, that eligible resources were used, and that electricity and RECs were not double counted across customers. CRS also reviewed the related marketing materials and customer disclosures.
The Outcomes
Across all three projects, CRS helped utilities move from a process of internal calculations to using an independently verified process for disclosures. For each client, CRS developed a structured audit protocol featuring annual CRS verification to help build customer trust in their clean energy program integrity.
Standard Delivery Clean Energy for Voluntary Buyers
“A private American university needed guidance to ensure its renewable energy claims and GHG accounting were accurate and aligned with best practices.”
The Challenge
Corporate clean energy buyers often assemble portfolios that span multiple procurement mechanisms, including PPAs, on-site generation, direct access, community choice aggregation, and unbundled RECs. Each mechanism carries different contract structures and accounting implications under the Greenhouse Gas Protocol reporting standards. Many companies want an external verification of their direct purchases of clean energy including verification of the clean portion of their standard delivery, known as Standard Delivery Clean Energy (SDCE).
Without oversight, the complexities related to a multi-source procurement strategy can lead to inconsistent accounting, unsupported claims, or missed opportunities to strengthen a renewable energy portfolio. By understanding what clean resources a company may already be receiving without any specified purchases, they can remain confident in their purchasing strategy and maximize their portfolio performance.
How CRS Advisory Services Responded
A private American university procured renewable energy through many of the mechanisms outlined above. The university needed guidance to ensure its renewable energy claims and GHG accounting were accurate and aligned with best practices. CRS reviewed the university’s full renewable electricity portfolio, comparing electricity consumption data against procurement contracts, on-site generation, REC retirements, and standard delivery clean energy supply.
CRS delivered the university a report with recommendations on REC portfolio management, making SDCE claims, cross-portfolio improvements, and public disclosure best practices. CRS conducted an in-depth analysis of how the university’s clean energy usage claims changed depending on whether RECs were retained or sold, highlighting the implications for reported emissions and credibility. This work also emphasized the importance of avoiding double counting in SDCE calculations and ensuring alignment with best practices for accurate and transparent greenhouse gas accounting.
The Outcomes
CRS’s recommendations strengthened the credibility of the university’s clean energy claims, improved its emissions accounting practices, and identified opportunities to improve the environmental impact of its procurement strategy. For buyers navigating complex, multi-source renewable electricity portfolios, CRS’s expertise in REC markets, GHG accounting standards, and procurement strategies is invaluable in helping corporate buyers make accurate, audit-ready claims.
Country-by-Country Market Evaluation and Procurement Credibility Guidance
“Two American multinational technology companies needed to understand how EACs could be applied to Scope 3 GHG emissions across their global supply chains with market-specific guidance on which instruments were credible and how to avoid double counting.”
The Challenge
Many companies with global operations and supply chains encounter a mix of diverse renewable energy markets when trying to meet their decarbonization commitments. They find energy attribute certificate (EAC) systems with different rules, varied tracking system mechanisms, and credibility risks within their supply chain. Without country-specific guidance, companies risk double counting, making inaccurate claims, or buying low-impact or low-quality renewable energy, exposing them to reputational and regulatory risk.
How CRS Advisory Services Responded
An American multinational technology company needed to understand how EACs could be applied to its Scope 3 GHG emissions (Categories 1, 2, and 11) across a global supply chain. The challenges were both in procuring the certificates and applying them consistently within recognized GHG accounting frameworks while avoiding double counting risks. CRS used GHG Protocol methodologies to evaluate how EAC purchases could be integrated into life-cycle emissions calculations for supplier electricity use. CRS conducted in-depth research on the EAC markets and procurement mechanisms that existed in their supply chain in China, Japan, Singapore, and Taiwan, assessing the credibility risks in each market and recommending procurement approaches.
Another American multinational technology company was building a supplier clean energy program which required suppliers to procure renewable electricity with the associated environmental attributes but realized EAC systems vary across the regions in which their suppliers operated. The company engaged CRS to create clear, market-specific guidance on which instruments were credible and how to avoid double counting. CRS researched global EAC markets and frameworks across multiple countries, including Mexico, Vietnam, Thailand, and Indonesia.
CRS developed technical specifications and procurement guidance, including a list of acceptable EAC types, eligibility criteria, and verification requirements.
The Outcomes
The result in both cases included a clear, actionable strategy for incorporating EACs into Scope 3 accounting that the company could apply consistently across its entire global supply chain. This work helped support both companies and their suppliers in procuring and retiring credible renewable energy certificates across international markets.
Both projects reduced the complexity of country-by-country EAC systems into structured, practical guidance. CRS’s deep knowledge of international renewable energy markets means clients don’t have to figure out each market on their own. From CRS Advisory Services, they can get clear, credible procurement frameworks they can use immediately.
Supporting Credible Supply Chain Renewable Energy Procurement
“A global technology company and a multinational pharmaceutical company wanted to ensure that their renewable energy procurement decisions (and those of their suppliers) delivered meaningful environmental and social impact.”
The Challenge
Large companies are increasingly expecting their suppliers to procure renewable electricity, but renewable energy markets and certification systems vary by country, and many suppliers have little experience procuring renewable energy or RECs. Without clear guidance, supplier participation tends to be low, inconsistent, or difficult to verify. Many companies need a framework that works across regions, is easy for suppliers to follow, and on which they can make credible claims.
How CRS Advisory Services Responded
A global technology company with an extensive supply chain faced a key challenge in ensuring that its renewable energy procurement decisions (and those of its suppliers) delivered meaningful environmental and social impact. In order to achieve this, the company needed a consistent, practical methodology to evaluate renewable energy projects across diverse markets, while also making the process accessible to suppliers and solution providers.
CRS developed and refined a suite of renewable energy procurement scorecards, building on the company’s existing internal tools and incorporating industry best practices. CRS translated complex impact criteria, including emissions reductions, community benefits, innovation, and land use into actionable scorecards tailored to different procurement types.
The result was a standardized set of tools that enabled the company and its suppliers to consistently assess, compare, and maximize the impact of its renewable energy investments across global markets.
In another instance, a multinational pharmaceutical company wanted to implement a program requiring their indirect U.S. suppliers, those who supply goods and services to the company (e.g., consultants, lawyers, office supply manufacturers), to procure renewable electricity proportional to the share of electricity the supplier company used to produce the goods and services for the client company.
The biggest challenge was that many suppliers had limited experience with RECs and renewable energy markets, and the company needed a complete program designed to include supporting educational guidance for suppliers. CRS contributed expertise on REC markets and supplier procurement strategies including on bundled and unbundled procurement options, determining REC eligibility criteria, how suppliers should allocate renewable purchases, and how the program’s requirements should vary across suppliers.
CRS also developed educational materials and a calculator to help suppliers understand procurement requirements and track their electricity use. In the end, the pharmaceutical company had a structured, implementable program and the tools to help its suppliers meet those goals.
The Outcomes
CRS supported these companies in translating renewable energy commitments into structured, scalable, impactful supplier engagement programs. By equipping their suppliers with standardized methodologies, clear procurement pathways, and practical tools, CRS made participation in renewable energy markets accessible to their suppliers regardless of prior experience or geographic location. CRS’s guidance helped increase supplier engagement for both companies which led to more impactful renewable energy procurement decisions and eventually to a stronger alignment between corporate climate goals and emissions reductions across their global supply chains.
Contact
For more information about CRS Advisory Services, contact:
Rachael Terada
Rachael.Terada@resource-solutions.org
(415) 561-2100
Rachel Palmer
Rachel.Palmer@resource-solutions.org
(415) 561-2100