CO2 vs. CO2e: What is the difference and why does it matter?

What are greenhouse gases?

To understand the difference between carbon dioxide and carbon dioxide equivalent, it's important to first understand what greenhouse gases are and why they matter.

In the simplest terms: Greenhouse gases are those that magnify sunlight and trap heat in the earth's atmosphere. Greenhouse gases from human activities are the main driver of climate change, according to the International Panel for Climate Change (IPCC) and other climate scientists and bodies, including the United States Environmental Protection Agency.

"From 1990 to 2019, the total warming effect from greenhouse gases added by humans to the Earth's atmosphere increased by 45 percent," according to the EPA.

Carbon dioxide on its own increased the warming effect by 36%, according to the EPA.

Greenhouse gases are heating up the Earth and causing rising sea levels, more flooding, hurricanes, fires and droughts, to name just a few problems. These problems, in turn, are also creating issues for companies and their IT teams, including putting business continuity at risk, creating supply chain disruptions and challenging leaders to think of sustainability, perhaps for the first time.

Why CO2e is a more useful metric than CO2

Modern lifestyles -- with their reliance on the production and consumption of fossil fuels -- produce the excesses of carbon dioxide and other greenhouse gases that drive climate change. Each greenhouse gas has particular sources and effects.

Carbon dioxide is released when people use oil, gas and other petroleum-based fuels -- including for IT and supply chains -- and when people cut down or burn forests.

In 2021, CO2 made up about 80% of all human-caused greenhouse gas emissions, according to the EPA.

Moreover, CO2 has contributed more to climate change than anything else between 1750 and 2011, according to the Union of Concerned Scientists, a science-based nonprofit organization.

But CO2 isn't the only greenhouse gas that's driving climate change.

Other greenhouse gases -- such as methane, nitrous oxide and fluorinated gases -- also have powerfully harmful effects on the environment.

Methane, in particular, is coming under scrutiny since it traps more heat per molecule than carbon dioxide.

Methane emissions account for about 15% of global greenhouse gas emissions, according to the EPA. That's largely from animal agriculture. For example, every year, 1.5 billion cattle raised for meat emit at least 231 billion pounds of methane into the atmosphere.

As for the rest of the greenhouse gas emissions, ozone, water vapor, nitrous oxides and fluorinated gases such as hydrofluorocarbons (HFCs) and chlorofluorocarbons comprise the remaining 5% of greenhouse gases.

CO2e and Global Warming Potential

To understand CO2e requires first understanding the concept of Global Warming Potential (GWP).

Both GWP and CO2e enable climate experts, legislators, businesses and others a shared metric to quantify the impact of GHGs. The first compares and the second collects.

Carbon dioxide, methane and other climate change-contributing greenhouse gases have different potencies and remain in the atmosphere for different lengths of time. For example, human-caused carbon dioxide stays in the atmosphere for tens of thousands of years, while methane remains for only about a decade. However, methane traps way more heat than does CO2.

The GWP framework, first introduced by the IPCC, gives a standard way to compare these and other GHGs. It compares the heat-trapping potency of one unit of a particular greenhouse gas against an equivalent unit of equivalent of carbon dioxide over a set period of time, usually 100 years. The GWP gives people a way to approximate the effect of greenhouse gas emissions on the climate.

CO2 has a GWP of 1 because it is the benchmark. Values of other greenhouse gases are updated as new IPCC assessments are released. For example, methane has a GWP of 27 to 30. In other words, methane has 27 to 30 times more warming potential than carbon dioxide. This means even though methane stays in the atmosphere for a shorter amount of time, this GHG is still urgent to address.

CO2e uses the Global Warming Potential as a basis to collect all the GHGs into a single number. In the broadest terms, this number is calculated by multiplying the mass of a the greenhouse gas in question by its GWP.

Reasons to assess the carbon footprint

As more companies focus on environmental, social and governance (ESG) goals in response to government regulations and consumer demand, they are also beginning to focus on understanding their carbon footprint.

The carbon footprint measures the total amount of greenhouse gases a company or person generates, and that requires knowing the CO2e -- and not just the CO2.

The Carbon Trust, a climate-focused consultancy based in London, England, U.K., notes that when a company has visibility into its carbon footprint, it can accomplish the following gains:

• Assess potential savings opportunities, by reducing energy consumption, for example.
• Become a more attractive organization to do business with in the eyes of both customers and investors.
• Develop a benchmark against which it can monitor the advancements it's making in relation to greenhouse gas emission reduction.
• Evaluate how to decrease the greenhouse gas emissions it generates.
• Identify the sources of its emissions.
• Manage business risk, particularly for the long term.

Carbon footprint calculation tools

"The Greenhouse Gas Protocol Corporate Accounting and Reporting Standard," published by the World Business Council for Sustainable Development and the World Resources Institute, notes that carbon footprint calculation tools fall under two main categories:

• Tools that are "sector-specific," such as aluminum, cement, iron and steel, office-based organizations, oil and gas, and pulp and paper.
• Tools that are designed for use across sectors, and that measure things like the use of HFCs in air-conditioning and refrigeration, mobile combustion of vehicles, and stationary combustion of electricity.

The Greenhouse Gas Protocol recognizes that most organizations need to use multiple calculation tools to account for all their emissions. It cites an aluminum production facility as an example. This specific case would require:

• Aluminum production-specific emissions calculation.
• Stationary combustion emissions calculations that take into consideration purchased electricity or onsite energy production.
• Mobile combustion emissions calculations for business travel, HFC consumption, and transportation of materials.

Several carbon footprint calculators exist, including the following:

• The EPA's Carbon Footprint Calculator (for personal).
• Greenhouse Gas Protocol Calculation Tools and Guidance.
• UC Berkeley CoolClimate Business Calculator.

To better understand carbon accounting, business and IT leaders should also understand Scope 1, Scope 2, and Scope 3 emissions, and ESG reporting frameworks.

Carolyn Heinze is a Paris-based freelance writer. She covers several technology and business areas, including HR software and sustainability.

Diann Daniel is an executive editor at Informa TechTarget overseeing Sustainability and ESG and other sites.

Guilliean Pacheco is a former associate editor at Informa TechTarget.