Porsche has reduced emissions from car manufacturing by 75% since 2014

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By Éloise Dulac, Consultant

In early April, Porsche announced that it had reduced emissions from its factories per vehicle produced by a factor of 4 in 4 years[1]. In fact, in 2014, the production of a car emitted nearly 1 metric ton of CO2, compared with just 250 kg of CO2 in 2018, according to the company’s report. While this is certainly cause for celebration, impressive reduction in CO2 emissions, let's keep in mind thatThese are emissions from the Porsche manufacturing plant, which account for a very small portion of the automaker’s total carbon footprint. In fact, this news provides an opportunity to reiterate that a company’s emissions are classified into three categories, known as scopes:

• Direct emissions are Scope 1 emissions; they correspond to emissions that occur directly at the company’s sites or from the exhaust of the vehicles it operates;
• Indirect emissions associated with grid energy (particularly electricity) are classified as Scope 2;
• Finally, the other emissions—known as indirect emissions—make up Scope 3.

The emissions reduction announced by Porsche applies only to vehicle manufacturing at its plants—that is, to Scopes 1 and 2. However, For automakers, as well as for many other companies, Scope 3 emissions account for the vast majority of their total carbon footprint compared to Scope 1 and 2 emissions.. For Porsche, the main source of emissions is, unsurprisingly, downstream from the manufacturing process—during the use of the vehicles sold.

To see this for ourselves, let’s do this simple back-of-the-envelope calculation: with an average reported emissions figure of 176 g CO2/km for its cars sold in 2017 [2], and assuming a distance traveled of roughly 100,000 km over the vehicle’s lifetime, The exhaust emissions from an average Porsche vehicle are therefore nearly 18 metric tons of CO2, which is already significantly higher than Scope 1 and 2 emissions (250 kg per vehicle)and that’s without even factoring in the potential discrepancy between actual emissions and certification emissions, or emissions associated with the upstream production of fuels. Another Scope 3 emissions source—this time upstream—is also likely to be more significant than Scope 1 and 2 emissions: the upstream carbon footprint of purchasing parts and components from original equipment manufacturers. This clearly demonstrates that For automakers, the climate challenge centers primarily on reducing vehicle lifecycle emissions, not just emissions from manufacturing.. While these emissions must, of course, be reduced—as is the case for any other company—an automaker cannot limit its climate policy to this scope alone. Porsche readily acknowledges this in the statement included in its press release: “Porsche is also working on reducing its environmental impact throughout the value chain.” This news also provides an opportunity to to examine guarantees of renewable origin for electricity.

In fact, within Scope 1 and 2, the reduction in emissions announced by Porsche is largely attributable to the purchase of certificates of origin for the electricity consumed, combined with a reduction in energy consumption of nearly 30% over four years. For emissions related to electricity (Scope 2 of the carbon footprint), the GHG Protocol distinguishes between two methods: the “location-based” method and the “market-based” method. “Location-based” accounting uses the emissions factor of the country in which the electricity is consumed, while “market-based” accounting uses the supplier’s emissions factor, and it is within this framework that direct emissions from electricity covered by renewable energy guarantees can be counted as zero (note that, over its life cycle, no electricity generation method has a zero carbon footprint). This second method is abstract in the sense that it is physically impossible to separate electrons from renewable sources from those from other sources in the electricity grid. Thus Reducing one’s carbon footprint by purchasing certificates of origin is an artificial way to lower emissions associated with electricity use, and this approach should be viewed with caution because the resulting reduction in emissions is not guaranteed when considering the electricity system as a whole.. For more details on how companies can incorporate these guarantees of origin into their strategies for reducing greenhouse gas emissions, interested readers may refer to the Carbone 4's recent publication on the subject (a publication that was accompanied by a webinar). Thus, Porsche’s excellent performance relates to a very limited portion of its total carbon footprint and is partly the result of an accounting rule rather than an actual reduction in emissions.

Sources: [1] Porsche Press Release [2] ICCT Pocket Book