Scope 3 Logistics (K4/K9): Ton-km or km? How to Collect Data?

Scope 3 Logistics (K4/K9): Ton-km or km? How to Collect Data?

In Scope 3 work, logistics emissions (Category 4 and Category 9) often turn out to be more difficult than expected. Because the data doesn't sit in one place within the company. Carrier invoices are in one place, shipment records in another, and warehouse operations are kept in a separate system.

In this article, we cover in detail the difference between Category 4 and Category 9, data collection approaches, calculation methods, and common mistakes.

What are Category 4 and Category 9?

GHG Protocol Scope 3 Standard addresses transportation and distribution emissions in two categories. The distinction is made based on responsibility and control status.

Category 4: Upstream transportation and distribution

Transportation of materials coming from suppliers to the reporting company. Transportation falling into this category has these characteristics:

• The company pays the transportation cost (excluding transportation included in goods cost)
• The company organizes or controls the transportation
• A third-party logistics provider works on behalf of the company

Other activities that can also be included in this category:

• Storage of materials coming from supplier to company
• Warehouses paid for or controlled by the company

Category 9: Downstream transportation and distribution

Transportation of products going from the company to customers. Transportation falling into this category has these characteristics:

• The customer pays the transportation cost or it's included in the goods price
• The company does not control the transportation
• Logistics organized by the customer

Key distinction: Who pays, who controls?

GHG Protocol makes the distinction based on payment and control status. If the company pays the transportation cost or organizes the transportation, it goes into K4. If the customer pays or it's outside the company's control, it goes into K9.

Making this distinction clear is critical to prevent double counting.

Data collection approaches

GHG Protocol offers three basic calculation methods. Each method has different data requirements and accuracy levels.

Fuel-based method

The most accurate method if the carrier's fuel consumption is known.

Calculation: Fuel consumption (liters) × Fuel emission factor (kg CO2e/liter)

This method requires obtaining data directly from the carrier. In practice, it's difficult to obtain. It's generally applicable for companies with their own fleet or closely-related logistics partners.

Distance-based method (ton-km)

The most commonly used method. It's calculated with the weight of cargo transported and transportation distance.

Calculation: Cargo (tons) × Distance (km) × Transport mode factor (kg CO2e/ton-km)

Data required for this method:

• Shipment weight (tons or kg)
• Origin and destination points (for distance calculation)
• Transport mode (road, sea, rail, air)

Distance can be calculated with map tools or averages.

Spend-based method

Can be a starting point if there's no data. Logistics spend is multiplied by sector average factor.

Calculation: Logistics spend (currency) × Emission factor (kg CO2e/currency)

This method has the highest error margin. Spend is affected by price fluctuations. But it's useful for screening studies.

Transport modes and factors

Each transport mode has a different emission factor per ton-km.

Road

Truck type and load factor affect the factor. Large trucks (TIR) are generally more efficient per ton-km. Small delivery vehicles have higher factors.

Average factor range: 0.05-0.15 kg CO2e/ton-km (depending on vehicle type)

Rail

Generally the transport mode with the lowest factor. Electric trains produce lower emissions than fossil-fuel trains.

Average factor range: 0.01-0.03 kg CO2e/ton-km

Sea

Container type and ship size affect the factor. Large container ships are very efficient. Small feeder ships have higher factors.

Average factor range: 0.01-0.02 kg CO2e/ton-km (for ocean freight)

Air

The transport mode with the highest factor. Should only be applied to shipments that actually use air transport.

Average factor range: 0.5-1.0 kg CO2e/ton-km

Intermodal

A shipment can use multiple modes. Each leg should be calculated separately and summed.

Warehouse emissions

Warehouse operations can also be included in Category 4 and 9. Warehouse emissions include:

• Warehouse electricity consumption (lighting, cooling, automation)
• Warehouse heating/cooling fuel consumption
• In-warehouse transport equipment (forklifts, etc.)

Warehouse data is generally allocated on m² or pallet position basis.

Common mistakes

Mistake 1: Mixing K4 and K9

Writing the same shipment to both K4 and K9 creates double counting. The distinction based on payment and control status should be made clearly.

Mistake 2: Assuming transport mode

Assuming every shipment is road transport leads to significant errors in shipments using sea or air. Actual transport modes should be determined or reasonable assumptions should be documented.

Mistake 3: Forgetting return trips

Empty vehicle returns may not be accounted for. If the logistics provider allocates these emissions or if the company uses its own fleet, return trips should be included.

Mistake 4: Unit conversion errors

Errors in kg and ton, liter and m³ conversions are common. Density values should be checked.

Mistake 5: Mixing international and local factors

DEFRA factors are optimized for UK context. Care should be taken when using in different geographies.

Data collection recommendations

1. Communicate early with the logistics department
2. Map existing data sources (ERP, logistics software, invoices)
3. Create a data collection template (origin, destination, weight, mode)
4. Request data from carriers (if possible)
5. Determine and document reasonable assumptions for missing data

Conclusion

Logistics emissions are manageable if the data schema is set up correctly. K4 and K9 distinction, transport mode, distance, cargo weight, and responsibility boundaries should be clearly defined. Activity-based (ton-km) calculation gives the most accurate result. Spend-based method can be used for initial screening but should transition to detailed calculation.