A carbon footprint is the total greenhouse gas emissions associated with an activity, product, person or organisation. In practice, it is usually expressed as tonnes of carbon dioxide equivalent (tCO2-e), a standard unit that converts different greenhouse gases into a comparable measure based on their global warming impact.
For Australian businesses, carbon footprint work often starts as a sustainability initiative, but it quickly becomes a commercial issue. Energy costs, customer expectations, tender requirements and emerging climate disclosure rules can all make emissions measurement and reduction a competitive advantage.
What a carbon footprint includes
A typical organisational carbon footprint includes emissions from the energy you use, the fuel you burn, and in many cases the emissions embedded in your supply chain. Most businesses structure their footprint using the Greenhouse Gas Protocol, which groups emissions into Scope 1, Scope 2 and Scope 3.
Scope 1 emissions (direct emissions)
Scope 1 includes emissions you directly produce from sources you own or control. Common Australian examples include:
- Natural gas burned on site for heating, hot water or process energy
- Fuel used in company vehicles, forklifts and mobile equipment (petrol, diesel, LPG)
- Refrigerant leakage from HVAC and refrigeration systems
Scope 2 emissions (purchased electricity emissions)
Scope 2 covers indirect emissions from the electricity you purchase and consume. Even though the emissions occur at power stations, they are attributed to you because your demand drives generation.
In Australia, Scope 2 is often the largest and simplest starting point for many office-based, retail and hospitality businesses because electricity consumption is metered and billed.
Scope 3 emissions (value chain emissions)
Scope 3 includes other indirect emissions across your value chain. Depending on your business, this can include:
- Purchased goods and services
- Freight and distribution
- Waste generated in operations
- Business travel and employee commuting
- Use of sold products (for some manufacturers)
Scope 3 can be the biggest part of a footprint for many organisations, but it is also the most complex to measure. Many businesses begin with material categories first.
Carbon footprint vs emissions intensity
Two common measures are used together:
- Carbon footprint: total emissions (tCO2-e) over a period, often a financial year
- Emissions intensity: emissions per unit of output, such as tCO2-e per $ revenue, per tonne produced, or per square metre
Intensity metrics help track performance when the business is growing or production changes year to year.
How to calculate a carbon footprint for your business (practical steps)
You do not need a perfect model on day one. A useful approach is to build a credible baseline you can improve over time.
Step 1: Set your boundary and reporting period
Decide what entities and sites you are including and for what period. Many businesses align this to the financial year to support reporting and budgeting.
Step 2: Collect activity data
Common data sources include:
- Electricity bills and interval data where available (kWh)
- Gas bills (MJ)
- Fuel receipts or fleet reports (litres)
- Refrigerant top-ups (kg by refrigerant type)
- Freight, travel and procurement data for Scope 3
Step 3: Apply emissions factors
Emissions are calculated by multiplying activity data by an emissions factor. Australian emissions factors vary by energy type and, for electricity, can vary by state and grid. Many organisations use published Australian Government factor sets or industry methodologies aligned to local reporting.
Tip: keep a record of which factor set and year you used. That makes your footprint auditable and repeatable.
Step 4: Choose a Scope 2 method (location-based vs market-based)
The Greenhouse Gas Protocol supports two common methods for Scope 2 electricity:
- Location-based: uses average grid emissions factors for the region, this reflects the emissions intensity of the electricity system you draw from.
- Market-based: reflects specific electricity purchasing decisions, such as renewable electricity products, where credible contractual instruments exist.
Some organisations report both. Your customers or stakeholders may specify which they expect.
Step 5: Quality check and document assumptions
Footprints often fail because the documentation is unclear. Track:
- Which sites and meters are included
- Any estimated months and why
- Material exclusions and plans to improve coverage
Australian context: why carbon footprints matter for businesses
Australia’s climate and energy policy landscape continues to evolve. Depending on your size and sector, carbon footprints can link to:
- Customer and supply chain requirements, especially for government and large enterprise tenders
- Corporate ESG reporting and board oversight
- Operational risk, where energy prices and peak demand affect both cost and emissions
- Specific regulatory schemes for larger emitters, such as emissions reporting and baselines
Even if you are not directly captured by formal schemes, many SMEs are being asked to provide emissions data by larger customers and financiers.
How to reduce your carbon footprint (what typically works best)
Most footprints can be reduced through a mix of efficiency, electrification and cleaner electricity supply. The right pathway depends on your load profile, sites, and budgets.
1) Reduce energy waste first
Energy efficiency is often the fastest way to cut emissions and costs. Common high-impact actions include:
- HVAC optimisation: scheduling, setpoints, maintenance and controls
- Lighting upgrades: LEDs and smarter controls
- Refrigeration tuning: seals, defrost cycles, night blinds, maintenance
- Compressed air and process equipment fixes in industrial sites
Efficiency savings can also reduce demand charges where your tariff includes a demand component.
2) Optimise your network tariff and retail contract
Two businesses with the same kWh usage can have very different bills and different incentives to reduce emissions, depending on their tariff structure.
Improving procurement does not directly change the grid’s emissions intensity, but it can free up budget for efficiency and electrification and it can reduce the risk of being stuck on poor-value rollover rates.
If you want to benchmark your pricing and tariff settings, Zembl can help you compare offers based on your real usage, not a headline rate:
3) Choose lower-emissions electricity options where appropriate
Depending on retailer availability and your contract size, options can include renewable-matched products or accredited renewable programs. The best fit depends on how you need to report emissions and the evidence your stakeholders require.
4) Electrify where it makes sense
Replacing fossil fuel equipment with electric alternatives can reduce Scope 1 emissions and shift energy use into electricity (Scope 2), which can be progressively decarbonised over time. Examples include:
- Replacing gas space heating with efficient electric heat pumps
- Switching gas hot water to heat pump hot water systems
- Moving from internal combustion fleet vehicles to EVs where operationally suitable
5) Manage peak demand and operational timing
If you are on a demand tariff or time-of-use pricing, changing when you use energy can reduce costs and, in some cases, reduce reliance on peak generation. Practical options include:
- Staggering equipment start-up to reduce demand spikes
- Shifting discretionary loads to off-peak windows
- Using controls to limit simultaneous high-load operation
6) Address high-impact Scope 3 categories
For many organisations, Scope 3 is where the biggest footprint sits. Start with categories that are both material and influenceable, such as:
- Major suppliers and high-spend categories
- Freight routes and logistics partners
- Waste services and recycling diversion
Supplier engagement is often more effective than trying to estimate every small category.
Common questions about carbon footprinting in Australia
Is carbon footprint the same as carbon neutral?
No. Your carbon footprint is a measurement of emissions. “Carbon neutral” usually means you have measured emissions and then reduced and or offset the remaining emissions using eligible offsets under a defined standard. Claims need careful governance to avoid greenwashing risks.
Do small businesses need to report emissions?
Most small businesses are not required to report under large-emitter frameworks, but reporting expectations can still arise through supply chain requests, finance, insurance or tender requirements. Having a simple, documented baseline can make these requests easier to meet.
What is the easiest part of a footprint to reduce?
For many SMEs, electricity is the best starting point because it is measured, it is often a large cost, and efficiency actions can be implemented quickly. Gas and fuel reductions often require equipment changes but can deliver meaningful Scope 1 reductions.
How Zembl can help reduce the energy part of your carbon footprint
For many Australian businesses, energy is the most measurable and controllable lever in the short term. Zembl helps you understand what you are paying today, compare alternatives from a panel of retailers, and move to a contract that better fits your load profile.
You can start with a bill-based comparison and a plain-English review of options:
Once your procurement is in a better place, many businesses reinvest some of the savings into efficiency upgrades that reduce both costs and emissions.
Next steps
If you want to take control of your footprint, start with a baseline using your bills and fuel data, then prioritise actions that cut energy waste and reduce peak demand. If you would like help reviewing your business electricity or gas plan so you can reduce costs while supporting emissions goals, Zembl can run a fast, bill-based comparison and handle the switch end-to-end.
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