Downstream Leased Assets Emissions — Methodology and Calculation Approach
When a company leases an asset out to another organisation, the lessee burns the fuel and draws the power — but the lessor still owns the asset and earns the income from it. Scope 3 Category 13 is the GHG Protocol’s answer to a deceptively simple question: whose inventory carries those emissions, and how are they counted without being counted twice?
Category 13 has no emission factors of its own — it is the lessor’s Scope 1 and Scope 2 re-attributed downstream, and getting the boundary right matters more than getting any single factor right.
Scope 3 Category 13 covers emissions from assets a company owns and leases out, where the lessee operates them. It reuses the lessor’s own Scope 1 and Scope 2 factors — energy use, fuel combustion, refrigerant loss — re-attributed downstream. Lower data quality means falling back from asset-specific to average-data methods.
This page is the citation-grade treatment of Scope 3 Category 13, downstream leased assets, as defined in the GHG Protocol Corporate Value Chain (Scope 3) Standard and bounded by the consolidation rules of the GHG Protocol Corporate Standard. It covers what the category does and does not include, the control-boundary logic that decides whether a leased asset sits in the lessor’s Scope 1 and 2 or in Category 13, the asset-specific-to-average-data method ladder, where the emission factors actually come from (there is no Category 13 factor set — the category re-attributes the lessor’s own Scope 1 and Scope 2 factors), three audit-record worked examples, and the assurance obligations that attach to the figure. It is the downstream mirror of Category 8, upstream leased assets, and is routinely confused with Category 11, use of sold products — both confusions are resolved below.
What Category 13 Covers — and What It Does Not
Category 13 captures the emissions from the operation of assets that the reporting company owns (as lessor) and leases to other entities, in the reporting year, that are not already included in the company’s Scope 1 or Scope 2. The defining feature is that the reporting company is the owner but not the operator: a property company that leases office floors to tenants, an equipment financier that leases plant and machinery, a vehicle-leasing firm whose cars are driven by client businesses. The lessee runs the asset day to day; the lessor still holds it on the balance sheet and earns lease income from it.
The emissions themselves are ordinary energy and combustion emissions — the leased building’s electricity and heating, the leased vehicle’s diesel, the leased chiller’s refrigerant loss. What makes them Category 13 rather than the lessor’s own Scope 1 and 2 is purely a question of who controls the asset and how the lessor has drawn its consolidation boundary. That boundary question is the substance of this category, and it is addressed in full in the next section.
The lessor’s mirror of the lessee’s Category 8
Every lease has two sides, and the GHG Protocol categorises each side from its own vantage point. The lessee — the company using the asset — accounts for a leased asset it operates but does not own under Category 8, upstream leased assets (when those emissions are not already in its Scope 1 and 2). The lessor — the company owning the asset and leasing it out — accounts for the same asset under Category 13. The two categories are mirror images: a single leased building can appear in one organisation’s Category 8 and another’s Category 13 simultaneously, which is expected and correct. Value-chain emissions are double-counted across companies by design; what the standard forbids is double-counting within a single company’s inventory.
Category 13 and Category 8 are the same emissions viewed from opposite ends of a lease. The lessor reports Category 13; the lessee reports Category 8. The same tonnes legitimately appear in both companies’ Scope 3 inventories — cross-company double counting is inherent to value-chain accounting and is not an error.
Three tests before a lease lands in Category 13
A leased-out asset belongs in Category 13 only when all three of the following hold. If any fails, the asset belongs somewhere else — usually the lessor’s own Scope 1 or 2, or no category at all.
| Test | Question | If the answer is no |
|---|---|---|
| Ownership | Does the reporting company own the asset and lease it to another entity? | Not Category 13 — if the company is the lessee, it is Category 8 |
| Exclusion from own scopes | Are the emissions excluded from the lessor’s Scope 1 and Scope 2 under its chosen consolidation approach? | Not Category 13 — they are already in the lessor’s Scope 1 or 2 |
| Operational period | Were the assets leased out and operated by lessees during the reporting year? | Not Category 13 — an idle or unleased owned asset is the lessor’s own Scope 1/2 |
An owned asset that is vacant, between tenants, or operated by the lessor itself is not Category 13 — its emissions sit in the lessor’s own Scope 1 and Scope 2. Category 13 is strictly the leased-out, lessee-operated portion. Sweeping an entire owned property portfolio into Category 13 without separating vacant and self-operated space overstates the downstream figure and understates the company’s own scopes.
The Consolidation-Boundary Interaction
Whether a leased-out asset is the lessor’s own Scope 1 and 2 or its Category 13 depends entirely on the consolidation approach the lessor has chosen under the GHG Protocol Corporate Standard: equity share, financial control, or operational control. The category does not change the emissions; it changes which inventory line they sit on. This is the single most consequential judgement on the page, and it is where most misclassification originates.
Why operational vs financial control flips the category
Under the operational control approach — the most widely used — a company accounts in its Scope 1 and 2 only for assets it operates. A leased-out asset is, by definition, operated by the lessee, so it falls outside the lessor’s Scope 1 and 2 and into Category 13. Under the financial control or equity share approaches, the test is ownership or financial benefit rather than operation; a finance-leased asset the company still owns may remain in its Scope 1 and 2, leaving nothing for Category 13. The same building, the same tonnes — a different inventory line depending solely on the boundary the lessor drew.
| Lessor’s consolidation approach | Lease type | Where the leased-out asset’s emissions sit |
|---|---|---|
| Operational control | Operating or finance lease (lessee operates) | Category 13 |
| Financial control | Finance lease (on lessor balance sheet) | Lessor Scope 1 / 2 |
| Financial control | Operating lease (off balance sheet) | Category 13 |
| Equity share | Owned and leased out | Scope 1 / 2 by equity %, remainder Category 13 |
Document the consolidation approach in the methodology note before classifying any lease. The same finance lease is the lessor’s Scope 1 under financial control but Category 13 under operational control. Auditors check the boundary declaration first; a Category 13 figure with no stated consolidation basis cannot be assured because its very existence depends on that choice.
The double-count guardrail with Scope 1 and 2
Because Category 13 is defined by exclusion — it is precisely the leased-out emissions not in the lessor’s Scope 1 and 2 — the two must be reconciled against each other. A finance-leased asset cannot be in both the lessor’s Scope 1 and its Category 13. The practical guardrail is a single boundary register that lists every owned asset, its lease status, the operator, and the inventory line it is assigned to, so that no asset is assigned twice and none is dropped. This register is also the artefact an assurance reviewer will ask for first.
Never let a single owned asset appear in both the lessor’s Scope 1/2 and its Category 13. The category is the leased-out remainder after the consolidation boundary is applied — not an additional copy. The most common within-company double count is a finance-leased building counted in Scope 2 (because the lessor pays the energy bill) and again in Category 13 (because a tenant occupies it). Decide once, per the consolidation approach, and record it.
The Calculation Method Ladder
The GHG Protocol Scope 3 Standard offers a tiered set of methods for Category 13, ordered from most to least data-intensive. The principle is identical to every other Scope 3 category: use the most asset-specific data available, and fall back to averages only where specific data cannot be obtained. Each rung trades data quality for data availability.
| Method | Data needed | Typical use | Data quality |
|---|---|---|---|
| Asset-specific | Actual energy and fuel consumption for each leased asset, with supplier or grid factors | Leased buildings or fleets where the lessee shares metered consumption | Highest |
| Lessee-specific | The lessee’s own reported emissions for the leased asset | Lessees with their own verified inventory covering the asset | High |
| Average-data (asset) | Asset type, floor area or unit count, and average energy-intensity factors | Portfolios where per-asset consumption is unavailable | Medium |
| Average-data (estimated) | Number or size of leased assets against published average intensities | Large, fragmented portfolios with minimal lessee data | Lowest |
Asset-specific method
The asset-specific method multiplies each leased asset’s actual measured consumption by the appropriate emission factor: metered electricity by the grid factor for the asset’s location, metered gas and on-site fuel by the relevant fuel factor, and any refrigerant top-ups by the gas-specific GWP. It is the method an assurance reviewer prefers and the one that produces a defensible, year-on-year-comparable figure. Its limiting factor is data access: the lessor must obtain consumption data from lessees, which lease agreements increasingly require through green-lease clauses.
Lessee-specific and average-data methods
Where the lessee maintains its own emissions inventory covering the leased asset, the lessee-specific method takes that reported figure directly — useful when the lessee is a large, disclosing organisation. Where neither asset-specific consumption nor a lessee inventory is available, the average-data methods estimate emissions from the asset type and a physical proxy (floor area for buildings, distance or unit count for vehicles and equipment) against published average energy intensities. Average-data estimates are a fallback, not a default: they should be used only after confirming that more specific data cannot be obtained, and the methodology note should record why.
A lessor’s portfolio rarely sits on a single rung. A large property book might cover anchor tenants asset-specifically (they share metered data), disclosing corporate tenants lessee-specifically, and a long tail of small tenants on average-data. Mixing methods within one Category 13 figure is expected — record the method used per asset so the blended figure can be audited and improved tenant by tenant.
Emission Factors and Where They Come From
Category 13 has no emission factors of its own. This is the single most important technical fact about the category and the source of a recurring error. The emissions are ordinary energy, fuel, and refrigerant emissions; the factors used are exactly the factors a company uses for its own Scope 1 and Scope 2 — re-attributed to a downstream category. A leased building’s electricity uses the same DEFRA or grid factor as the company’s own offices; a leased vehicle’s diesel uses the same per-litre or per-kilometre factor as the company’s own fleet.
| Leased asset emission source | Factor family used | Unit | How it renders |
|---|---|---|---|
| Leased-asset electricity (UK grid) | Grid electricity factor | kg CO₂e/kWh | 0.131 |
| Leased-asset natural gas / heating | Stationary fuel factor | kg CO₂e/kWh (gross CV) | 0.18231 |
| Leased-vehicle fuel use | Passenger / delivery vehicle factor | kg CO₂e/km | 0.17265 |
| Leased-asset refrigerant loss | Refrigerant GWP × charge lost | kg CO₂e/kg leaked | refrigerant GWP × leaked mass |
The current applied values for these primitives are the live UK grid electricity factor 0.131 kg CO₂e/kWh and the natural gas factor 0.18231 kg CO₂e/kWh on a gross-CV basis, both from the DEFRA 2025 conversion factors; an average diesel car renders 0.17265 kg CO₂e/km. All three factors are stated on an IPCC AR5 100-year GWP basis, consistent with DEFRA’s regulatory mode — this page uses AR5 GWP-100 throughout. For leased electricity, choose the location-based or market-based factor per the GHG Protocol Scope 2 Guidance consistently with the rest of the inventory; do not mix bases across categories. Note also that these three sources differ by scope at the lessor’s own boundary: grid electricity is a Scope 2 source, while fuel combustion and vehicle fuel are Scope 1. Whether the leased asset’s emissions sit in those lessor scopes or fall into Category 13 is precisely the control-boundary question of §2 — under operational control they leave the lessor’s Scope 1 and 2 and become Category 13.
Do not reach for a “Category 13 factor set” — there isn’t one, and any dataset labelled as downstream-leased Cat-13 factors is a mislabelled copy of ordinary energy and transport factors. Compose the figure from the same grid, fuel, and vehicle factors used for the company’s own Scope 1 and 2. The only thing that differs is the inventory line the result is reported on.
Implementation Workflow
A repeatable Category 13 process runs in six steps, from boundary declaration to a method-tagged figure ready for assurance.
- Declare the consolidation approach. State whether the inventory uses equity share, financial control, or operational control — this determines whether leased-out assets are Category 13 at all.
- Build the owned-asset register. List every owned asset, its lease status, the operator, and the inventory line it is assigned to. This is the double-count guardrail and the first artefact assurance will request.
- Filter to the Category 13 set. Keep only assets that pass all three tests — owned and leased out, excluded from the lessor’s Scope 1/2, and operated by lessees during the reporting year.
- Assign a method per asset. Asset-specific where consumption data is available; lessee-specific where the lessee reports; average-data otherwise. Record the method on each line.
- Apply the matching factors. Grid factor for electricity, fuel factor for combustion, vehicle factor for leased transport, refrigerant GWP for leaks — the lessor’s own Scope 1/2 factor families.
- Aggregate and document. Sum to a single Category 13 figure, retain the per-asset method tags and evidence, and record the factor versions used so the figure is reproducible against the right DEFRA edition.
Worked Examples — Audit Records
Three audit-record snapshots. All values are hardcoded illustrative audit records: they reconcile to their stated inputs and continue to reconcile regardless of future data-layer changes. The figures are dated illustrative snapshots using DEFRA 2025 factors and do not represent any specific named organisation; each is replicable in the downstream leased assets calculator once published. Factors shown are the DEFRA 2025 v1 values applied on the stated review date.
Example A — leased office floor (asset-specific)
| Example A — leased office floor, asset-specific method | Value |
|---|---|
| Leased asset | One office floor, let to a single tenant, UK |
| Metered electricity (tenant-shared) | 90,000 kWh |
| UK grid factor (DEFRA 2025) | 0.177 kg CO₂e/kWh |
| Electricity emissions = 90,000 × 0.177 | 15,930 kg CO₂e |
| Metered natural gas (heating) | 40,000 kWh |
| Natural gas factor (DEFRA 2025, gross CV) | 0.18296 kg CO₂e/kWh |
| Gas emissions = 40,000 × 0.18296 | 7,318.4 kg CO₂e |
| Category 13 total | 23,248.4 kg CO₂e (23.25 t) |
The floor is operated by the tenant under an operating lease, and the lessor reports on an operational-control boundary, so the floor is excluded from the lessor’s Scope 1 and 2 and falls into Category 13. Its emissions are metered, placing it at the top of the ladder. The electricity uses the UK grid factor (a Scope 2 source at the lessor’s boundary) and the heating uses the natural gas factor on a gross-CV basis (a Scope 1 source) — the same factors and AR5 GWP-100 basis the lessor would apply to its own offices. The result, 23.25 tonnes, is the asset-specific Category 13 figure for this floor. Under a financial-control boundary with the floor finance-leased and on the lessor’s balance sheet, the same tonnes would instead sit in the lessor’s own Scope 1 and 2.
Example B — leased vehicle fleet (average-data)
| Example B — leased car fleet, average-data method | Value |
|---|---|
| Leased assets | 25 average-size diesel cars on operating leases to client businesses |
| Estimated annual mileage per car | 16,000 km |
| Average diesel car factor (DEFRA 2025) | 0.17304 kg CO₂e/km |
| Per-car emissions = 16,000 × 0.17304 | 2,768.64 kg CO₂e |
| Fleet emissions = 2,768.64 × 25 | 69,216 kg CO₂e |
| Category 13 total | 69,216 kg CO₂e (69.22 t) |
The cars are on operating leases to client businesses, who operate them, and the lessor reports on an operational-control boundary — so the fleet is excluded from the lessor’s own Scope 1 and falls into Category 13. Actual per-vehicle fuel data is not available from the lessees, so the figure uses estimated mileage against the average diesel car factor (AR5 GWP-100) — an average-data estimate. It is a defensible fallback, but the methodology note should record that asset-specific fuel data was sought first and was unavailable, and that obtaining metered fuel or telematics mileage would move the fleet up the ladder and likely change the figure.
Example C — mixed downstream-leased portfolio roll-up
| Asset group | Method | Category 13 emissions |
|---|---|---|
| Office floor (Example A) | Asset-specific | 23.25 t |
| Car fleet (Example B) | Average-data | 69.22 t |
| Disclosing corporate tenant (own inventory) | Lessee-specific | 12.50 t |
| Portfolio Category 13 total | — | 104.97 t |
The portfolio total, 104.97 tonnes, blends three methods across three asset groups — exactly the mixed picture a real lessor faces. The figure is reported as one Category 13 line, but the per-group method tags are retained so an assurance reviewer can see that the asset-specific and lessee-specific groups are well-evidenced and the average-data fleet is the priority for data improvement. Note that moving the fleet to asset-specific data would change its emissions, not just its data-quality label — the two move together, and both should be disclosed when the method changes.
Improving the method for an asset group will usually change its emissions, not only its data-quality tag — average-data estimates can understate or overstate actual consumption. When a group moves from average-data to asset-specific between reporting years, disclose the method change alongside the emissions change so the movement is not mistaken for a real-world reduction. Examples A–C hold each group’s basis fixed to isolate the arithmetic.
Edge Cases and Known Pitfalls
There is no Category 13 factor set
The category re-attributes the lessor’s own Scope 1 and 2 factors — grid, fuel, vehicle, refrigerant — to a downstream line. Any dataset presented as dedicated downstream-leased Cat-13 factors is a mislabelled copy of ordinary energy and transport factors. Compose, don’t hunt.
The control boundary decides the category
The same leased asset is the lessor’s Scope 1/2 under financial control but Category 13 under operational control. Declare the consolidation approach before classifying any lease; the category’s existence depends on it.
Never double-count within the company
A finance-leased building counted in Scope 2 and again in Category 13 is the most common within-company double count. Cross-company double counting (lessor’s Cat 13 = lessee’s Cat 8) is expected; within-company is an error. Use one boundary register.
Vacant and self-operated space is not Category 13
An owned asset that is unleased, between tenants, or operated by the lessor itself sits in the lessor’s own Scope 1 and 2. Category 13 is only the leased-out, lessee-operated portion. Separate the two before aggregating.
Leased products are Category 11, not 13
If the reporting company leases out a product it manufactured (rather than an asset it holds to earn lease income), the use-phase energy may belong in Category 11, use of sold products. Category 13 is for assets the company owns as a lessor; Category 11 is for products it sold or leased as a manufacturer. The distinction turns on the company’s role.
Sub-leases and sale-and-leaseback chains
In a sub-lease, the intermediate party can be both lessee (Category 8) and lessor (Category 13) for the same asset; map the chain explicitly. In a sale-and-leaseback, ownership and operation separate at the transaction date — re-classify the asset from that date, not the reporting-year start.
Average-data is a fallback, not a default
Estimating from floor area or unit count against average intensities is legitimate only after asset-specific and lessee-specific data have been sought and found unavailable. Reaching for averages first understates achievable data quality and the methodology note should record the attempt.
Hold the Scope 2 basis consistent
Leased-asset electricity must use the same location-based or market-based basis as the rest of the inventory, per the Scope 2 Guidance. Mixing a market-based figure here with location-based elsewhere produces a category total that cannot be reconciled to the inventory.
Governance, Assurance, and Disclosure Obligations
Category 13 is a disclosable line wherever Scope 3 is in scope — under the GHG Protocol Scope 3 Standard for any company reporting its value-chain inventory, and within the mandatory regimes that require material Scope 3 categories. An assurance reviewer reads the boundary declaration before the tonnage: because Category 13 is defined by exclusion from the lessor’s own scopes, its figure is only meaningful once the consolidation approach and the owned-asset register are on the table.
Run the following pre-flight before submitting a Category 13 figure for assurance:
- Consolidation approach declared. The inventory states equity share, financial control, or operational control, and the Category 13 set follows from it.
- Owned-asset register complete. Every owned asset is listed with lease status, operator, and assigned inventory line — no asset is assigned twice or dropped.
- Three-test filter applied. Each Category 13 asset is owned and leased out, excluded from the lessor’s Scope 1/2, and lessee-operated during the reporting year.
- No within-company double count. No asset appears in both the lessor’s Scope 1/2 and its Category 13.
- Method recorded per asset. Each asset carries its method — asset-specific, lessee-specific, or average-data — with the supporting evidence.
- Correct factor families. Emissions are composed from the lessor’s own grid, fuel, vehicle, and refrigerant factors, not a fictitious Category 13 factor set.
- Scope 2 basis consistent. Leased-asset electricity uses the same location- or market-based basis as the rest of the inventory.
- Vacant and self-operated space excluded. Only leased-out, lessee-operated portions are in Category 13; the rest is in the lessor’s own scopes.
- Method-and-emissions co-movement disclosed. Where a method improved between years, the consequent emissions change is disclosed alongside it.
- Factor versions documented. The DEFRA or grid factor edition used is recorded so the figure is reproducible.
The three assurance findings most specific to Category 13 are: a figure with no declared consolidation approach (the category’s existence is undefined without it), a within-company double count between Scope 2 and Category 13, and average-data estimates used without evidence that asset-specific data was sought. Lock all three in the methodology note before assurance.
What the Calculator Handles vs What You Decide
A calculator automates the factor arithmetic and the portfolio roll-up. It cannot make the boundary and classification judgements that determine whether an asset belongs in Category 13 at all.
The calculator handles
Applying the correct grid, fuel, and vehicle factor to each leased asset’s consumption; converting metered energy, fuel volume, or distance to CO₂e; rolling per-asset results up to a single Category 13 figure; tracking the figure across reporting periods; and producing an audit trail showing each asset’s method, factor, and emissions.
You decide
Which consolidation approach the inventory uses; whether each asset passes the three tests; which method each asset genuinely supports given the data held; whether available electricity data is location- or market-based; how sub-lease and sale-and-leaseback chains are mapped; and that no asset is double-counted within the company.
Apply the matching factors to each leased asset, roll up to a single Category 13 figure, and produce a method-tagged audit trail across a mixed downstream-leased portfolio.
Standards Alignment
Four standards govern Category 13 and its disclosure consequences.
| Standard | Role for this methodology |
|---|---|
| GHG Protocol Scope 3 Standard | Defines Category 13, downstream leased assets, the method ladder, and the boundary relationship with the lessee’s Category 8. The methodological foundation of this page. |
| GHG Protocol Corporate Standard | Defines the consolidation approaches — equity share, financial control, operational control — that decide whether a leased-out asset is Category 13 or the lessor’s own Scope 1/2. |
| GHG Protocol Scope 2 Guidance | Governs the location-based vs market-based treatment of leased-asset electricity, which must stay consistent with the rest of the inventory. |
| UK DEFRA Emission Factors | Supplies the grid, fuel, and vehicle factors the category re-attributes; the source of every applied value used in the worked examples. |
Frequently Asked Questions
Category 13, downstream leased assets, covers emissions from assets a company owns and leases out to other entities that operate them, where those emissions are not already in the company’s Scope 1 or Scope 2. It captures the energy, fuel, and refrigerant emissions of leased-out buildings, vehicles, and equipment, attributed to the lessor.
They are mirror images of the same lease. Category 8, upstream leased assets, is reported by the lessee — the company using an asset it does not own. Category 13 is reported by the lessor — the company owning the asset and leasing it out. The same leased asset legitimately appears in one company’s Category 8 and another’s Category 13.
No. Category 13 re-attributes the lessor’s own Scope 1 and Scope 2 factors — grid electricity, fuel combustion, vehicle, and refrigerant factors — to a downstream line. There is no dedicated Category 13 factor set; any dataset labelled as such is a mislabelled copy of ordinary energy and transport factors.
It depends on the consolidation approach. Under operational control, a leased-out asset is operated by the lessee and falls into Category 13. Under financial control or equity share, a finance-leased asset the company still owns may remain in its Scope 1 and 2, leaving nothing for Category 13. Declare the approach before classifying.
A tiered ladder: asset-specific (actual metered consumption per asset), lessee-specific (the lessee’s own reported emissions), and average-data (asset type and a physical proxy against average intensities). Use the most specific data available and fall back to averages only where specific data cannot be obtained.
No. Cross-company double counting is inherent to value-chain accounting and is expected — the lessor’s Category 13 and the lessee’s Category 8 describe the same emissions from opposite ends of the lease. What the standard forbids is double-counting within a single company’s inventory, such as an asset in both the lessor’s Scope 2 and its Category 13.
No. An owned asset that is unleased, between tenants, or operated by the lessor itself sits in the lessor’s own Scope 1 and Scope 2. Category 13 is strictly the leased-out, lessee-operated portion. Separating vacant and self-operated space from leased space is necessary before aggregating the category.
Use the same basis as the rest of the inventory, per the GHG Protocol Scope 2 Guidance. If the inventory reports Scope 2 on a location-based basis, leased-asset electricity in Category 13 uses the location-based grid factor too. Mixing bases across categories produces a total that cannot be reconciled to the inventory.
Usually not. If the company leases out a product it manufactured, the use-phase energy typically belongs in Category 11, use of sold products. Category 13 is for assets the company owns as a lessor to earn lease income; Category 11 is for products it sold or leased as a manufacturer. The distinction turns on the company’s role in the transaction.