Measure, Understand, and Reduce your GHG Emissions

Getting started

Reducing GHG emissions can feel overwhelming for small and medium-sized enterprises (SMEs), especially when resources are limited. The good news is that many strategies are low-cost and can even save money through efficiency improvements. 

You do not need to do everything at once. Start with one or two quick changes to your business processes — like upgrading lighting, reducing travel, or setting a supplier policy. Many of these steps save money by cutting fuel or electricity bills. Financial incentives and government programs are often available to help cover the costs of bigger projects, such as switching to heat pumps or electric vehicles.

For Scope 1 and Scope 2 emissions

Start with quick and relatively inexpensive options for reducing your carbon footprint. Examples might include establishing an anti-idling policy, providing driver training, implementing route optimization, using thermostat setbacks, right-sizing vehicles, and tightening maintenance intervals. 

Then explore bigger solutions that take a longer time to yield results. Examples might include electrifying process heat where feasible, moving to low-GWP refrigerants and compliant equipment, evaluating thermal storage for peak shaving, and replacing end-of-life gas heat with high-efficiency heat pumps.

For Scope 3 emissions

Scope 3 emissions is one of the most challenging but impactful areas to reduce emissions, especially where supply chains are often across long distances and involve cross-border vendors. 

Start with what’s material for your business model. Identify which of your business’s Scope 3 activities are expected to have the most significant GHG emissions. Then start with one category and make changes incrementally. For example, start by reducing emissions from commuting or business travel, then move on to waste reduction or changing product packaging. 

 

Practical strategies for small businesses

Here are some practical steps and strategies that can help a small business achieve significant reductions in GHG emissions while maximizing its investment:

Improve energy efficiency

• Reduce electricity consumption by replacing traditional lighting with energy-efficient LED lights.
• Upgrade to high-efficiency heating, ventilation, and air conditioning (HVAC) systems. Regular maintenance and smart thermostats can further optimize energy use.
• Improve insulation and seal leaks in the building to reduce heating and cooling needs.

Install or purchase renewable energy

• Reduce reliance on grid electricity by installing solar panels on the property.
• Purchase renewable energy credits (RECs) or opt for green energy plans from utility providers.

Consider alternative transportation options

• Transition to electric or hybrid vehicles for any company-owned transportation. 
• Implement route optimization software to reduce fuel consumption and emissions from delivery vehicles.

Reduce waste and increase recycling

• Reduce emissions associated with waste by establishing comprehensive recycling programs for paper, plastics, and other materials.
• Conduct regular waste audits to identify opportunities for waste reduction and recycling improvements.

Source sustainably

• Source products from suppliers with strong environmental practices. 
• Purchase from local suppliers to reduce emissions from transportation.

Engage employees

• Educate employees about energy-saving practices and the importance of reducing emissions. Encourage them to participate in sustainability initiatives.
• Offer incentives for employees who contribute to emission reduction efforts, such as carpooling or using public transportation.

 

Common strategies for reducing Scope 1 and Scope 2 emissions

Approach	Examples	Typical payback time	Benefits
Employee training and engagement	Encouraging drivers to avoid idling and ensuring staff turn off equipment when not in use.	Short (months)	Energy/fuel savings with limited investment
Preventative maintenance	Regularly servicing boilers, furnaces, and vehicles to improve efficiency.	Short (months)	Lower fuel bills, extended equipment life, fewer unexpected breakdowns (can also reduce fugitive Scope 3 emissions
Process optimization	A bakery could do batch cooking runs to minimize oven warm-ups, or a machine shop could reduce compressed air leaks.	Short (months)	Reduced operating costs and often better productivity alongside lower emissions.
Energy efficiency	Businesses can condense boilers, use LED lighting, or ENERGY STAR-certified ovens and refrigerators.	Medium (2-5 yrs)	Utility bill savings, improved comfort or productivity.
Fuel switching	Replacing oil-fired boilers with electric heat pumps or using renewable biofuels in place of diesel.	Long (4-10 yrs)	Long-term fuel savings if switching to electricity in provinces with cheap, low-carbon grids (e.g., Québec, Manitoba, B.C.); reduced exposure to volatile oil and gas prices; strong marketing value as “low-carbon operations
Fleet management and electrification	Small businesses with delivery vans, service vehicles, or equipment fleets can cut emissions through route optimization, regular maintenance, driver training, and eventually shifting to electric or hybrid vehicles	Medium (1–2 yrs)	EVs can reduce fuel and maintenance costs compared to gas vehicles (region dependent).

 

Example: Reducing Scope 3 emissions from waste 

Category	Examples of reduction opportunities	Possible actions	Potential benefits
Purchased goods/services	Office supplies, chemicals & consumables	Purchase in bulk to reduce packaging/shipping  Consider local sourcing to reduce transportation emissions	Potential to reduce purchase cost
Upstream transportation	Removal of waste from site to incinerator	Partner with haulers using low-emission vehicles  Optimize logistics routes to reduce fuel use	Better operational efficiency
Employee commuting	Daily travels to incinerator facility	Incentivize carpooling, e-bike or public transit  Encourage remote work where feasible	Reduced private transportation emissions
Downstream transportation & distribution	Ash, residues and disposal	Engage with third parties who use zero-landfill ash processing Recycle bottom ash for construction	Improved ESG profile

 

Key Takeaway for SMEs

Reducing Scope 1 and Scope 2 emissions does not have to mean expensive overhauls. Many changes, such as preventive maintenance, staff training, and energy audits, have low upfront costs and quick payback periods. Taking small steps such as reducing on-site energy use can be a good first step before investing in bigger projects. 

Larger investments, such as fuel switching or electrification, deliver long-term savings and risk protection against carbon pricing and rising fossil fuel costs. A smart approach is to combine “quick wins” with a strategic roadmap for bigger investments, while taking advantage of Canadian incentives, grants, and green financing options to ease cash flow.

Scope 3 emissions tend to be the most challenging to address due to the complexity of their causes. A good first step for SMEs looking to reduce their Scope 3 emissions is to map their supply chain. Mapping emissions allows you to understand the nature and causes of emissions within your supply chain and engage suppliers to act.

Big wins for reducing scope 3 emissions can begin in optimizing transportation. Implementing circular economy principles reduces downstream emissions. Another critical aspect of the GHG reduction journey is people. Engaging suppliers across your supply chain ensures that everyone is aligned with your organization’s sustainability objectives. Employee engagement and incentivizing emissions reduction activities create a culture of sustainability in your business.

 

Where can I find more information?

Resource	What it Offers / How SMEs Can Use It
SME Sustainability Roadmap	A guide that helps SMEs identify emissions sources (energy, waste, materials) and take actionable steps (e.g., audits, improvements, employee engagement). (ISED Canada)
Reference Document for SMEs — Net-Zero Challenge Technical Guide	Includes self-assessment tools (e.g., NetZero Ambition Disclosure), emissions inventory tools & calculators, and suggested actions to reduce Scope 1, 2, 3 emissions. (Government of Canada)
GHG Reduction Toolkit for SMEs	Sector-tailored ideas (e.g., retail, facility operations) for reducing energy use, improving efficiency, and switching to cleaner sources. (ECO Canada)
Canadian Industry Partnership for Energy Conservation (CIPEC)	A partnership that offers technical guidance, networking, benchmarks, and partial funding/support for energy management projects. (Natural Resources Canada)
EDC Energy Efficiency Checklist	A checklist to help businesses find opportunities (lighting, heating/cooling, operations) and locate funding or tax credit options. (Export Development Canada)