Context of the Organization

Task Overview

The scope and boundaries enable your organization to focus efforts and resources by defining what the EnMS includes. The scope identifies the set of activities that are included in the energy management system (EnMS), while the boundaries are the physical or organizational limits of the EnMS, commonly referred to as the “fence line” of your site. The boundaries do not have to be fixed in a physical space and could be established around a fleet of vehicles or other transportation equipment.

In the 50001 Ready Navigator the term site is used and carries the same meaning as other terms that describe the physical definitions of a space such as facility, complex, location, and campus so long as there is a relative physical proximity to the assets that will be included within the EnMS.

When determining the scope and boundaries strategic issues and requirements determined as part of Task 1 An EnMS and Your Organization should be considered. In addition, you should ensure that your organization has the authority to control all energy uses within the scope and boundaries, and that no energy-using equipment or systems are excluded unless they are separately metered or a dependable calculation can be made. Once the scope and boundaries are defined, an organization cannot exclude any energy sources that cross or are within the defined boundaries of the EnMS.

EnMS scope and boundaries could include any combination of physical structures: the building management operations of one or more commercial buildings at one or more specific locations; the manufacturing, warehousing, and distribution activities at a particular plant; or multiple sites of a corporation at multiple sites, to name just a few. In many cases, the scope and boundaries may only include one building or site. Top management must ensure the organization’s scope and boundaries are established.

This guidance is relevant to Section 4.3 of the ISO 50001:2018 standard.

The creative commons license is applicable only to the technical content found in the "Getting it Done", "Task Overview", "Full Description", and "Decarbonization" tabs. The creative commons license does not extend to the 50001 Ready Navigator software or other resources.

Full Description

The creative commons license is applicable only to the technical content found in the "Getting it Done", "Task Overview", "Full Description", and "Decarbonization" tabs. The creative commons license does not extend to the 50001 Ready Navigator software or other resources.

Determining the scope and boundaries for an energy management system that includes energy-related GHG emissions allows your organization to focus its efforts and resources.  As described in the Task Overview, the scope identifies the set of activities that are included in the EnMS, while the boundaries are the physical or organizational limits of the EnMS.

When determining the scope, or set of activities to be included in the EnMS, organizations will need to distinguish between the various sources of direct and indirect emissions that are to be managed by the EnMS. The GHG Protocol’s Corporate Accounting and Reporting Standard defines three categories, or “scopes” of direct and indirect emissions that are widely used and should be considered:

• Scope 1 Emissions: Direct GHG emissions. 

  Direct GHG emissions occur from sources that are owned or controlled by the organization, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.; emissions from chemical production in owned or controlled process equipment.

• Scope 2 Emissions: Electricity indirect GHG emissions.

  Scope 2 accounts for GHG emissions from the generation of purchased electricity, steam, heat, or cooling consumed by the organization. Purchased electricity is defined as electricity that is purchased or otherwise brought into the organizational boundary of the company. For purchased energy, scope 2 emissions physically occur at the facility where electricity, steam, heat, or cooling is generated. 

• Scope 3 Emissions: Other indirect GHG emissions. 

  Scope 3 is an optional reporting category that allows for the treatment of all other indirect emissions. Scope 3 emissions are a consequence of the activities of the organization, but occur from sources not owned or controlled by the organization. Some examples of scope 3 activities are extraction and production of purchased materials; transportation of purchased fuels; and use of sold products and services.

For most organizations, inclusion of scope 1 and scope 2 emissions is the minimum that should be considered when determining the EnMS scope and boundaries. However, some organizations also include scope 3 emissions within the scope of their GHG objectives and can consider including some categories of scope 3 emissions that are energy-related in the EnMS.

Keep in mind that your organization may choose to manage some scope 3 emissions, for instance by engaging with stakeholders in the value chain, whether or not it chooses to report those emissions externally. Consider the issues and requirements identified in Task 1: An EnMS and Your Organization to determine which GHG emissions categories are relevant to your organization. For instance, the decision to include various categories of scope 3 emissions in the EnMS could be due to those emissions being:

• Large relative to the organization’s scope 1 and scope 2 emissions.
• Critical to key stakeholders (e.g. customers or investors)
• Ones that your organization can influence (e.g. outsourced production processes).

In setting the boundaries for the EnMS, consider the EnMS scope identified (especially for scope 3 emissions) to ensure that the boundaries include all managed emissions. 

For many organizations, starting with management of scope 1 and 2 boundaries will provide ample opportunity to reduce energy-related GHG emissions.

For corporate entities, the organizational boundary addresses the variety of ownership structures a corporation could have, including wholly owned operations, incorporated and unincorporated joint ventures, subsidiaries, and others. Chapter 3 of the GHG Protocol’s Corporate Accounting and Reporting Standard provides guidance on the use of two distinct approaches to define organizational boundaries for the purpose of accounting for GHG emissions:

• Equity share approach: A company accounts for GHG emissions from operations according to its share of equity in the operation.
• Control approach: A company accounts for 100 percent of the GHG emissions from operations over which it has control.

Corporate entities should review this document to better understand corporate GHG emissions accounting practices.

The creative commons license is applicable only to the technical content found in the "Getting it Done", "Task Overview", "Full Description", and "Decarbonization" tabs. The creative commons license does not extend to the 50001 Ready Navigator software or other resources.