How to measure your carbon footprint as a small manufacturer

What a carbon footprint measures

Greenhouse gases trap heat in the atmosphere. The main ones are carbon dioxide, methane, nitrous oxide and the fluorinated gases used in refrigeration and some industrial processes. Each gas has a different warming effect, so they are converted into one unit: tonnes of carbon dioxide equivalent, written tCO₂e.

The Greenhouse Gas Protocol (GHG Protocol) Corporate Standard is the method most reporting rules build on. It sorts your emissions into three scopes.

• Scope 1 covers fuel you burn and gases you release yourself: gas in boilers and furnaces, diesel in forklifts and vans, refrigerant leaks and any process emissions.
• Scope 2 covers the electricity, heat or steam you buy.
• Scope 3 covers everything else in your value chain, from the materials you buy and the freight that brings them to the waste you send away.

For a first footprint, start with Scope 1 and 2. You control them, the data is easy to find, and they are what customers ask for first. Scope 3 comes next, and our article on Scope 3 when your customer asks explains where to begin. For the basic terms, see carbon accounting basics.

The reasons to measure are practical. Larger customers ask for emissions in questionnaires and tenders. Central government contracts worth more than £5 million a year ask bidders for a Carbon Reduction Plan under Procurement Policy Note 006 (PPN 006). And a footprint shows which activities use the most energy, which is where cost sits too.

Step 1: decide what to include and for which year

Your boundary is the set of sites, vehicles and equipment you count. For most small manufacturers it is the whole business: every site, every vehicle and every piece of plant you own or control.

If your group includes subsidiaries, joint ventures or partly owned businesses, you need a rule for what is in. The GHG Protocol Corporate Standard gives three: operational control, financial control or equity share. Choose one, write it down and apply it every year.

Then choose a 12-month period. Your financial year works best, because energy and emissions then line up with your accounts. If this is your first footprint, use the most recent 12 months for which you have complete records.

Step 2: list your emission sources and find the data

Walk through the business and list every activity that releases greenhouse gases. Then note where the figure for each one is kept. For a typical small manufacturer the list looks like this.

Mark which sources are significant. Electricity, gas and company vehicles are usually most of a small manufacturer's own emissions, and their data is the easiest to find, so do those first.

For vehicles, litres from fuel cards give a more accurate figure than mileage, because they record what was burned. Use mileage where fuel records do not exist.

Step 3: collect 12 months of records

Gather every bill and invoice for the period. Check that the dates cover the whole year without gaps or overlaps. A quarterly gas bill that runs across two reporting years has to be split between them.

Where a record is missing, make a reasonable estimate and write down how you made it. A missing month of electricity, for example, can be estimated from the months either side. Label it as an estimate and replace it with the real figure when you can.

Keep the source document with each figure. The bill behind the number is what makes it believable to a customer or an auditor. A total with nothing behind it is hard to defend when someone asks where it came from.

• Every meter on every site has 12 months of readings or bills.
• Units are physical: kWh, litres or kilograms, not pounds spent.
• Fuel card totals match the invoices.
• Every estimate is labelled, with a line on how it was made.

Step 4: convert activity into emissions

The arithmetic is one line: activity data multiplied by an emission factor gives emissions. Kilowatt hours of gas multiplied by the factor for natural gas gives kilograms of CO₂e, which you divide by a thousand for tonnes.

In the UK, the Department for Energy Security and Net Zero (DESNZ) publishes greenhouse gas conversion factors for company reporting every year, free on GOV.UK. Use the set for your reporting year and record which one you used. Factors change from year to year, so mixing sets makes your figures hard to compare. More on this in conversion factors explained.

The same publication includes factors for the emissions created in producing and delivering your fuel and electricity before they reach you. Those upstream energy emissions belong in Scope 3, and adding them gives a fuller picture at little extra effort.

If you use a calculator or software, check which factors it applies and whether you can see each calculation. If you cannot see the arithmetic, you cannot answer a customer who asks how a figure was produced.

Step 5: check the result and put it to use

Start with a sense check. Do the largest sources match what you would expect on the shop floor? Compare energy with production, so a busy month is not mistaken for waste.

Compare years fairly. When the electricity grid gets cleaner, the factor falls and your electricity emissions fall with it, even if you changed nothing. Show the change both as reported and at the same factors, so the progress you claim is your own.

Keep monitoring. Track energy and fuel each month rather than once a year, and share the figures site by site with the people who can act on them. A measured baseline is also the starting point for any reduction target.

Then decide where the figures go. Small companies are not legally required to publish their emissions. Streamlined Energy and Carbon Reporting (SECR) covers quoted companies and large unquoted companies. The size tests changed for financial years beginning on or after 6 April 2025. An unquoted company is now medium-sized, and outside SECR, if it meets two of these: turnover up to £54 million, balance sheet up to £27 million, up to 250 employees.

Customers, tenders and lenders ask regardless. Your footprint will usually end up in one or more of these places:

• answers to supplier questionnaires;
• tender responses;
• a Carbon Reduction Plan for public contracts;
• a Voluntary Sustainability Reporting Standard for SMEs (VSME) report, whose Basic module asks for energy use and Scope 1 and 2 emissions;
• a short statement on your website.

How ESGen helps you measure

The ESGen platform does this work today for the sources most small manufacturers start with. You enter electricity, gas, diesel, petrol and staff car mileage by site and meter. ESGen applies the DESNZ factors for the right year and adds the upstream energy share of Scope 3. A calculation log records the activity, factor, source and result for every line.

You attach each bill to the figure it supports in the evidence library. Data checks flag gaps, and a reporting period locks once you have chosen it, so signed-off figures do not change underneath you. See carbon assessment and emission factors for how that works.

For sources outside that list, such as refrigerant, LPG, waste or purchased materials, we agree the approach with you before any work starts. The same records feed the SECR, Carbon Reduction Plan and VSME lenses in the platform, with the reports and plans prepared by our team. More on our work with manufacturers.

To see how it would work with your own bills, book a demo.