Scope 2 emissions in India: CEA grid factors, RECs, green tariffs and the market-based method

For most Indian companies, Scope 2 — the emissions from generating the electricity they buy — is the largest or second-largest part of the inventory, and the easiest to get wrong in small ways: the wrong year's grid factor, a renewable purchase counted twice, or a certificate that does not qualify. This guide explains the two methods, the factors to use in India, how renewable purchases count, and what BRSR expects.

Two methods, two answers

The GHG Protocol's Scope 2 Guidance requires companies to report Scope 2 both ways where contractual instruments such as certificates or green tariffs are available, as they are in India³:

• Location-based: the electricity you consumed × the average emission factor of the grid it came from. It shows the emissions of the grid you depend on, whatever you buy.
• Market-based: the electricity you consumed × the emission factor of what you contracted for — renewable certificates, green tariffs, power purchase agreements — with the remainder at a residual or grid factor. It shows the effect of your purchasing choices.

A company with no renewable contracts reports the same figure under both. One with large renewable purchases may report a much lower market-based figure — if its instruments meet the rules below.

The location-based factor: CEA's database

India's grid factors come from the Central Electricity Authority's CO2 Baseline Database for the Indian Power Sector. Version 22, dated August 2026, gives these weighted averages, including renewable generation¹:

Three details matter in practice:

• Use the factor for the year of consumption, from the latest version. Each version revisits recent years with actual data, so FY 2024-25 in version 22 may differ from the same year in version 21¹.
• The weighted average is the factor for corporate reporting. The database also publishes an operating margin, a build margin and a combined margin (for FY 2025-26: 0.963, 0.446 and 0.705). These are baselines for carbon-credit projects under the CDM's grid tool, not the average of the grid you draw from¹.
• The factors are for CO₂ only. CEA stopped publishing an average excluding renewables from version 20 onwards².

Our guide to calculating emissions from activity data works through units and factors in more detail.

How renewable purchases count

Under the market-based method, a contractual instrument lowers your Scope 2 only if it meets the GHG Protocol's Scope 2 Quality Criteria — among them that it conveys the attribute of a specific MWh, is retired or cancelled for you alone, matches the period of consumption, and comes from the same market as your operations³. In India the main routes are:

• Renewable Energy Certificates (RECs) under CERC's 2022 regulations: one REC is one MWh, certificates remain valid until redeemed, they are traded on the power exchanges or through traders, and Grid-India runs the registry⁵. A March 2026 amendment added certificates for virtual power purchase agreements, which pass to the consumer and are extinguished when used — they cannot be resold on the exchanges⁶.
• Green energy open access: under the Green Energy Open Access Rules, 2022, consumers with a connected load of 100 kW or more (no limit for captive plants) can buy renewable power through open access, and distribution companies offer a green tariff set by the regulator, with a certificate for the green energy supplied⁷.
• Captive and group-captive plants, and rooftop solar behind the meter — rooftop generation you consume lowers grid purchases directly.
• I-RECs, issued in India under the international I-REC standard. They are a separate system; generation used to meet renewable purchase obligations is screened out to avoid double counting¹⁰, and the same MWh must never be claimed under both an Indian REC and an I-REC.

What if there is no residual mix?

The market-based method needs a factor for the electricity you did not cover with instruments: ideally a residual mix — the grid's emissions after removing everything claimed by certificate holders. India has no published residual mix¹¹. The 2015 guidance then falls back to the grid average, while warning that this double counts renewable attributes already claimed by others³.

The Scope 2 rules are changing

The GHG Protocol is revising its Scope 2 guidance. Its public consultation ran from October 2025 to January 2026 and proposed hourly matching of consumption and renewable supply, and that instruments come from a grid the electricity could actually be delivered across. Its October 2026 update describes two market-based methods — one adding hourly matching, deliverability and incrementality, one keeping the 2015 rules for a transition period — with a further consultation planned for the second quarter of 2027 and the revised standard, developed jointly with ISO, expected in the fourth quarter of 2028. No effective date has been set⁴.

For now, the 2015 guidance applies. Keeping consumption by month — and, where you have it, by hour — makes the change easier later.

What does BRSR expect?

BRSR asks for Scope 1 and Scope 2 emissions without naming a method. The Industry Standards on Reporting of BRSR Core tell companies to use the latest applicable CEA grid emission factor, and count green-tariff and wheeled renewable power as renewable energy in the energy KPIs; they do not describe market-based accounting or certificates⁹. In practice:

• report the location-based figure with the CEA factor in BRSR, stating the version and year;
• show renewable electricity in the energy indicators, by source;
• if you also report a market-based figure — for CDP, customers or a target — label it, and explain the instruments behind it.

Renewable consumption obligations

Separately from reporting, the Energy Conservation Act's renewable consumption obligation requires designated consumers that use captive or open-access power to meet a rising share of their consumption from non-fossil sources — 29.91% in 2024-25, rising to 43.33% in 2029-30 — directly or through RECs, with shortfalls treated as non-compliance⁸. The same MWh can serve a regulatory obligation and your inventory only if the instrument rules allow it; keep the two ledgers separate.

How ESGTrack helps

ESGTrack calculates Scope 2 both ways: location-based with the CEA factor for each month of consumption, and market-based with renewable certificates, green tariffs and contracts recorded beside the electricity they cover — the coverage capped at what was consumed, and any surplus shown. The factor, its version and its source stay attached to every result. See carbon accounting and the free emissions calculator.