Reconciling transactions in the carbon ledger is where the carbon accounting in Sumday begins.
As you go through the reconciliation process in the carbon ledger, Sumday will use the underlying emission factor for the emission source selected and multiply this by the transaction amount to provide an equivalent amount of C02-e. This is the initial Spend based emission calculation process before overlaying and adding Activity data in the Accounting tab.
Assign emission sources to transactions
To assign an emission source to a transaction, use a combination of the General Ledger Account, Supplier, and Description details to provide context and guide you to the most relevant emission source.
Relying solely on the General Ledger Account or Supplier may be suitable for some cases, but using all three fields typically results in a more precise emission source assignment. For more information on selecting emission sources, see this article here.
Example: A 'Construction' General Ledger Account may contain transactions for wood, metal, concrete, and labor, each with different emissions impacts. Using the General Ledger Account for information only also limits the use of this data for making better sustainability or procurement decisions.
Emission sources group activities into categories, often industry-specific, such as Forestry Products or Consulting. Sometimes sources are even more specific, like Paper or Concrete. Since there might not be a perfect match for every transaction, select the best available fit (while you want this to be as ‘accurate’ as possible, its useful to note emission factors underlying emission sources are calculated using proxy data so it’s better to focus attention on improving the quality of your data that getting too caught up on which 'industry average' (emission factor) to use if two seem applicable. The key is to stay consistent in your selections.
Using emission factors to guide your selection
As you choose an emission source, you’ll see the underlying emission factor in the right hand pop out, which provide detailed emissions data underneath the emission source. This information helps you make informed decisions and identify opportunities to improve your assessment quality in the future with more accurate data sources, such as Primary or Activity Data. You can also click on the source link to view the database from which the emission factors are derived, offering transparency into the data's origin.
Note for Scope 1 & 2 transactions
Transactions that relate to Scope 1 or 2 emissions can be reconciled as Scope 1 or 2 in the carbon ledger (see here for the sub categories of Scope 1 & 2) and these are marked as 'reconciled' however we don't apply a spend-based calculation for these transactions, as activity data for Scope 1 and 2 emissions is a minimum requirement for a robust GHG Inventory. These transactions are marked in the Carbon Ledger as Scope 1 or 2 transactions, but no CO2e calculation is made for these transactions. The actual fuel, power and other activity data related to Scope 1 and Scope 2 are entered int he Accounting section of the assessment, under Scope 1 and 2.