A running theme in work on ESRS E1, including amended versions discussed in 2025, is alignment with the GHG Protocol for greenhouse gas inventories. For CSRD reporting, that is not a technical footnote: it is what lets readers compare companies and tie numbers to international frameworks already used in finance and sustainability.
Scopes 1, 2, and 3: a practical recap
Scope 1 — direct emissions (on-site combustion, company-owned vehicles, etc.). Scope 2 — purchased energy (electricity, heat, steam), location- or market-based depending on the method chosen. Scope 3 — other indirect emissions in the value chain (upstream and downstream), often dominant for services and digital.
Summaries of the draft amended ESRS E1 stress harmonised definitions and consistency with these boundaries, to limit divergent interpretations across Member States and sectors.
Why LLM inference usually lands in Scope 3
When you consume models hosted by a provider (cloud API), you typically do not control the power plant or the server hall: related emissions are attributed through the chain of purchased services — usually Scope 3 categories (often category 1 “purchased goods and services” or category 11 “use of sold products”, depending on your business model; see your boundary analysis).
GHG Protocol alignment does not pick the category for you: it requires consistency and documentation when you allocate emissions.
Comparability and emission factors
The market expects traceable emission factors (source, year, allocation assumption). For AI, “per token” or “per request” coefficients are models; they should be stated as such, with a confidence level (measured, benchmarked, estimated) compatible with your internal review procedures.
Double counting and the value chain
When your supplier already publishes a footprint and you calculate your own, double counting risk must be managed in the ESRS narrative (boundary, allocation method). ESRS E1 texts push for clarity on boundaries — which matches what institutional investors expect from GHG Protocol practice.
Disclaimer. Informational article. Validate any Scope 3 classification with your accountant / auditor and your CSRD materiality analysis.