Purchasing, using, maintaining, and disposing of company-owned vehicles contributes to the carbon footprint of an organisation. Companies that wish to reduce their greenhouse gas (GHG) emissions need to carefully consider their environmental and procurement policies when it comes to company-owned vehicles. Many companies have phased out internal combustion engine cars (e.g. petrol and diesel) in favour of electric vehicles (EVs).

But without high-quality data, the potential net positive environmental impact of this choice is unknown. The full carbon footprint of car ownership must take into account GHG emissions generated during manufacturing, usage, maintenance, disposal and recycling at the end of a vehicle’s life.

In this short report, we compare the typical GHG emissions that result from ownership of 4 common car types: EV, plug-in hybrid, petrol, and diesel. Our analysis shows that the choice of vehicle type can have a substantial, long-term impact on a company’s carbon footprint.

1. Accounting for Vehicle GHG Emissions

The release of greenhouse gases into the atmosphere is one of the main causes of climate change. The GHG protocol [3] is an internationally recognised set of tools and standards which aid companies in measuring and reporting the GHG emissions associated with their operations and activities. The GHG protocol categorises emissions into one of three scopes:

• Scope 1 – direct emissions, arising from combustion or the direct release of greenhouse gases
• Scope 2 – indirect emissions, arising from the consumption of purchased electricity, heat, steam, and cooling
• Scope 3 – indirect emissions, from all sources of emissions not covered by scope 1 and 2, including relevant activities occurring upstream and downstream of a business

Figure 1: a) Lifetime vehicle ownership GHG emissions split between manufacturing, usage, and maintenance.

Figure 1: b) As above, but split according to scope 1, 2 and 3 GHG emissions.

In figure 1: b) the split between scope 1, 2, & 3 emissions for 4 different types of medium-sized cars are shown.  While scope 3 is large for all cars, scope 1 and 2 have varying sizes depending on the engine type.

Many people associate vehicle GHG emissions with those that are produced from the exhausts of cars with internal combustion engines. However, throughout the entire lifetime of the car, from purchase, usage, maintenance, and disposal, GHG emissions are produced that must be accounted for to fully assess the environmental impact of ownership (see figure 1: a).

It is not expected that every company should directly measure the volume of GHG emissions using specialist equipment. Instead, the GHG protocol describes the process for translating primary data (e.g. litres of fuel consumed or volume of energy purchased ) into GHG emissions weight, using emissions factors. For example, emissions resulting from vehicle usage can be calculated using an appropriate emissions factor, which converts litres of fuel purchased into kg CO₂e – a representation of the main greenhouse gases and their respective potential to cause global warming. Higher values of CO₂e indicate a higher contribution to climate change. Other emissions factors can take into account the vehicle engine size to convert mileage into kg CO₂e.

Emissions factors are typically calculated and released by public bodies or other related organisations (e.g. energy suppliers) for use by companies in calculating and reporting their GHG emissions. In this report, we make extensive use of emissions factors released by the UK government [4] in order to compare the lifetime GHG emissions of vehicle ownership across different car types.

1.1 Manufacturing emissions

The industrial processes that occur before a  car is purchased contribute to the ’embodied emissions’ of the product. Activities, like extraction, processing and transportation of raw materials, as well the assembly of the thousands of components that make up the car all result in the generation of GHG emissions. Indeed any product purchased by a company has embodied emissions which contribute to the company’s scope 3 emissions. In the case of EVs and plug-in hybrids, there are additional contributions to the embodied emissions resulting from the battery in the vehicle. As a result, EVs have the largest average embodied GHG emissions of the four car types in this study, leading to a higher environmental impact before the car is ever used (see figure 1: a).

1.2 Usage emissions

Vehicle usage is responsible for GHG emissions due to the fuel or power source used by the vehicle. In the case of cars powered by fossil fuels (e.g. diesel, petrol, and hybrid) the GHG emissions are the direct result of the combustion of fossil fuels by the vehicle (scope 1). In addition, there are indirect emissions related to extracting, refining, and transporting the fuel to the point of sale – known as well-to-tank (WTT – scope 3).

For cars powered by purchased electricity, GHG emissions are indirect, arising from fossil fuels combusted for energy generation (scope 2) as well as indirect emissions from transmission and distribution of power as well as WTT of the fuels used for power generation (both scope 3). A summary of how each of the different emissions sources contributes to an overall usage emissions factor for different vehicle types is shown in figure 2. The combination of all relevant sources of emissions leads to an effective usage emissions factor for each vehicle type. Overall, petrol cars have the highest usage emissions factor, while EVs have the smallest.

Figure 2: Comparison of contributions to the vehicle usage phase GHG emissions.

1.3 Maintenance emissions

Over their lifetime, vehicles require maintenance, including the replacement of parts. On average, the cost of maintenance of EVs is smaller than fossil fuel powered vehicles and this difference in cost is mirrored by lower maintenance GHG emissions for EVs, compared to plug-in hybrid, diesel and petrol vehicles [1]. Generally, maintenance emissions are lower for EVs, compared to other vehicle types (see figure 1), due to EVs having fewer moving components.

1.4 Vehicle end-of-life

Once a vehicle reaches the end of its life, GHG emissions can result from the disposal of the components of the car. Equally, certain components can be reused or recycled, potentially avoiding emissions from the production of new parts in other products. For simplicity, GHG emissions resulting from the disposal of a vehicle when it reaches its end-of-life are omitted from this report.

2. Overcoming the High Embodied Emissions of EVs

Figure 3: a) GHG emissions over time for different vehicle types using the same assumptions as figure 1. Maintenance emissions are included for vehicle types, spread evenly over the 13 years shown in the figure.

Figure 3: b) Like-for-like comparison between an EV and the three other vehicle types, showing the mileage after which an EV results in lower total emissions.

Figure 1 shows the embodied emissions of an EV are higher than other types of cars, mainly due to processes involved with manufacturing the large batteries found in EVs. The same figure also shows that usage emissions from EVs are smaller than for other vehicle types, leading to overall lifetime emissions being lower overall for EVs. In figure 3: a), the year-by-year increase in emissions is shown for the 4 vehicle types, under the same assumptions used in figure 1. Under the same usage conditions (and assuming constant emissions factors) the figure shows that an EV can be the best choice from an emissions perspective but only if the vehicle is owned for an extensive period of time. Equally, it’s possible to view this comparison from a usage perspective: like-for-like, how far must an EV be driven, compared to other vehicle types, before the alternate has higher emissions in total? This is shown in figure 3: b). For example, if an EV is driven for less than 81,000 km, it will produce more GHG emissions in its lifetime compared to a plug-in hybrid driving the same distance.

Figure 3 shows that if a company has a policy of replacing vehicles periodically (e.g. every 5 years), then depending on the usage at that time, an EV may not be the right choice, given the high embodied emissions relative to usage emissions for EVs.

3. Anticipated Future Reduction in EV Usage Emissions

The usage emissions data presented in this study assumes that the usage emissions factors remain the same in the future. For fossil fuels this is a reasonable assumption, however, for electricity consumption, it is expected that the recent trend of decreasing emissions intensity of grid electricity will likely continue in the near future. Taking the UK as an example, in figure 4 we show the year-by-year emissions for an average medium-sized EV, travelling 10,000 km per year on average, for two cases:

1. Constant emissions factor over time (blue)
2. Emissions factor decreasing year on year in line with the UK government’s goal to decarbonise the electricity grid by 2030 (green)

A decreasing emissions factor results in an abatement of 4200 kg CO₂e between 2023 – 2035 per EV, emphasising the importance of a greener, low carbon energy grid for achieving both company-specific and country-wide Net Zero goals.

4. Making the Right Choice

ClearVUE.Business provides businesses with the data and expertise to take action and reduce their GHG emissions. ClearVUE.Business’ experts in energy and sustainability emphasise that actions must not only reduce emissions but also make sense from a business point of view, both commercially and practically.

Consider the case of purchasing a new company car. The projected usage patterns, relative purchase, usage, and maintenance costs, as well as lifetime emissions, must all be accounted for. It’s not as simple as choosing an EV to be green. Indeed, if the car will be infrequently used then the lifetime GHG emissions may be higher for an EV compared to other vehicle types (as illustrated above). Likewise, if the car will be used for long, frequent journeys, then an EV may not be practical due to limitations in range.  This distinction is summarised in the decision matrix shown in table 1 and presents a simplified view of the methodology ClearVUE.Business’ experts apply in helping customers make decisions compatible with their operations and environmental goals. Company-specific recommendations require closer consultation and information gathering before any recommendations are shared.

Independent of the results of this study, a company can always reduce its carbon footprint by reducing, reusing, and recycling the resources it consumes. For assisting the environmental consequences of key procurement decisions, like purchasing a new vehicle for business purposes, ClearVUE.Business’ experts are able to provide the advice needed to make the right choice.

Table 1: Example company vehicle purchase decision matrix, accounting for anticipated usage pattern.

Assumptions

The following assumptions are used throughout this report:

1. The 4 car types presented here are not representative of specific models but rather represent an average, medium-sized car as per the UK government methodology for GHG emissions.
2. Unless otherwise stated, all emissions factors are taken from ‘Greenhouse gas reporting: conversion factors 2023 ’ provided by the UK government [4].
3. For simplicity, annual mileage is assumed constant at 10,000 km per year. A larger mileage assumption would change the usage emissions calculated.

References

[1] Green Green cap life cycle tool.

[2] EDF Electric car maintenance servicing.

[3] World Business Council for Sustainable Development and World Resources The Greenhouse Gas Protocol: A Corporate Accounting and Re- porting Standard. World Business Council for Sustainable Development, 2004.

[4] UK Government. Government conversion factors for company reporting of greenhouse gas

[5] Rivian Kearney Pathway report.