Scope 3 Category 13 Explained: Downstream Leased Assets for Landlords

Every time a landlord discusses tenant energy use in a sustainability report they are really describing Scope 3 Category 13 downstream leased assets the specific line in the GHG Protocol Corporate Value Chain Standard that governs exactly this situation. It rarely gets called by its formal name in real estate conversations but understanding it as a defined category with its own boundary rules and calculation methods rather than a vague catch all for tenant emissions matters considerably once a portfolios Scope 3 figures come under any real scrutiny. Category 13 has precise rules about what counts what does not and how a landlord decides whether tenant emissions belong here at all rather than in the landlords own Scope 1 and 2.

This guide walks through what Category 13 actually covers the boundary decision that determines whether it even applies and how it should be calculated properly.

What Category 13 actually covers and what it does not

Under the GHG Protocol Corporate Value Chain Standard downstream leased assets covers emissions from the operation of assets a reporting company owns and leases out to another entity where those emissions are not already accounted for in the companys own Scope 1 or Scope 2. For a landlord this means the energy a tenant consumes operating their own leased space lighting equipment local air conditioning sits in Category 13 provided it has not already been captured elsewhere in the landlords own operational emissions. Crucially the category covers the operation of the leased asset itself not the tenants entire business. A tenants own supply chain their staff commuting their own corporate travel none of that belongs to the landlords Category 13 only the emissions tied specifically to operating the leased space itself.

The boundary decision that determines whether this is even Category 13

Whether tenant emissions land in Category 13 at all depends entirely on which organisational boundary approach a landlord has adopted. Under a financial control approach assets a company owns and leases out should actually be reported within that companys own Scope 1 and Scope 2 not Scope 3 at all. Under an operational control approach which is what most real estate businesses use given landlords typically do not operationally control what happens inside a tenants leased space that same tenant energy use falls squarely into Category 13 instead. This distinction is not a technicality. Getting it wrong risks either double counting emissions the landlord has already reported elsewhere or omitting them entirely because nobody checked which boundary approach the portfolios own reporting was actually built on.

How Category 13 is actually calculated

Category 13 uses methodology closely mirrored on the approach used for upstream leased assets elsewhere in the Scope 3 Standard offering two genuinely different levels of rigour depending on what data is actually available.

The asset specific method

Where a landlord has access to genuine measured data sub metered consumption refrigerant maintenance logs actual fuel use for a specific leased asset that data should be used directly converted using the correct emissions factor for the relevant year. This is the more accurate approach and the one that produces figures capable of withstanding genuine scrutiny which depends entirely on the same calculation lineage discipline that underpins any other credible carbon figure.

The average data method

Where asset specific data genuinely is not available an average data approach applies a recognised benchmark or spend based estimate to approximate emissions which is a legitimate fallback but should be documented explicitly as an estimate distinct from measured figures in line with proper data quality grading practice.

Avoiding double counting with Category 11

The Standard specifically flags a risk worth understanding where a leased product behaves more like a sold product in terms of usage pattern and duration a company may choose to account for it under Category 11 use of sold products rather than Category 13 and needs to apply one approach consistently rather than risk counting the same emissions under both categories.

Why real estate is where Category 13 matters most

For most industries leasing out equipment or vehicles Category 13 is a relatively minor line in a broader Scope 3 inventory. For real estate specifically it is often the single largest category in the entire Scope 3 footprint since tenant occupied space represents the core activity of the business itself not a peripheral leasing arrangement. This is exactly why proper tenant carbon allocation matters so much more for landlords than it does for a business leasing out the occasional piece of machinery and why frameworks a portfolio already engages with GRESB and CSRD where material expect this category to be addressed with real rigour rather than a rough undocumented estimate.

Building Category 13 reporting into a wider governed process

Category 13 should never be calculated in isolation from a portfolios wider carbon reporting. Tenant consumption data ideally captured through proper metering and secured through green lease clauses should flow into the same governed carbon calculation process used for Scope 1 and 2 applying consistent methodology and clear documentation of which calculation method asset specific or average data was used for each building. Understanding how a governed data process works end to end is what turns Category 13 from an annual estimation exercise into a genuinely defensible part of a portfolios overall Scope 3 disclosure.

A test for your own Category 13 reporting

Take your portfolios most recent Category 13 figure and ask three questions. Do you know which organisational boundary approach financial or operational control your reporting is actually built on and whether that means tenant emissions genuinely belong in Category 13 at all. For each building could you say whether the figure came from the asset specific method or the average data method or is that distinction currently blurred together. And have you checked for any overlap between Category 13 and Category 11 that might risk double counting the same underlying emissions. If any answer gives you pause your Category 13 figure exists but it may not yet be built on the specific rules the category actually requires.

Teams working through this often find it useful to review practical Scope 3 methodology guides and sector specific sustainability insights and to compare approaches with peers through a partner programme where relevant. If you are weighing up tools to support this reviewing pricing and learning more about the team behind the platform is a sensible next step before your next reporting cycle.