How to build an ISO 14064-1 GHG inventory, step by step

A greenhouse-gas inventory is an account: every tonne of CO₂e your organization reports should trace back to a meter reading, an invoice, or a supplier statement, multiplied by an emission factor you can name. ISO 14064-1:2018 is the standard that says what that account must contain for it to be verifiable. This guide walks the whole process in seven steps, in the order a practitioner actually does them.

What ISO 14064-1 actually asks for

ISO 14064-1 specifies requirements for quantifying and reporting emissions and removals at the organization level. The 2018 revision organizes emissions into six categories:

Category	What it covers	GHG Protocol equivalent
1	Direct emissions and removals (combustion, process, fugitives, company vehicles)	Scope 1
2	Indirect emissions from imported energy (electricity, heat, steam, cooling)	Scope 2
3	Indirect emissions from transportation (upstream/downstream freight, commuting, business travel)	parts of Scope 3
4	Indirect emissions from products used by the organization (purchased goods, services, capital goods, waste)	parts of Scope 3
5	Indirect emissions associated with the use of the organization’s products	parts of Scope 3
6	Indirect emissions from other sources	parts of Scope 3

Categories 3–6 are only reported when significant — but you must define and apply documented significance criteria, not silently skip them. All seven GHG families count: CO₂, CH₄, N₂O, HFCs, PFCs, SF₆ and NF₃, each converted to CO₂e.

Step 1 — Fix the organizational boundary

Decide which legal entities and facilities are “you”, using one consolidation approach applied consistently:

• Operational control — you count 100% of emissions from operations you run. The most common choice, and usually the one that matches how your data is collected.
• Financial control — 100% of what you control financially.
• Equity share — emissions in proportion to ownership.

List every site in scope (plants, warehouses, offices, vehicles), and record why anything is excluded. Boundary gaps are the first thing a verifier probes.

Step 2 — Fix the reporting boundary

Within the organizational boundary, decide which of categories 1–6 you will quantify. Category 1 and 2 are always in. For 3–6, rank sources by estimated magnitude, data availability, and stakeholder expectations, then write down the significance criteria you applied. A first-year inventory that covers categories 1–2 completely and the two or three largest category 3–4 sources is more defensible than one that covers everything thinly.

Step 3 — Collect activity data (and keep the evidence)

Activity data is the measured quantity that drives each source: kWh purchased, litres of diesel, kilograms of refrigerant topped up, tonne-kilometres shipped. Practical rules:

• Prefer measured over estimated: meter readings and invoices beat floor-area allocations and industry averages.
• Keep the source document for every figure — the utility bill PDF, the fuel card export, the waste-contractor report. In verification you will be asked to produce them by sample.
• Watch the units at entry time: kWh vs MWh, litres vs m³, kg vs tonnes. Unit slips are the most common calculation error in first inventories.
• Close the gaps explicitly. Where a month of data is missing, document the estimation method (pro-rata, same month last year) rather than leaving it silent.

Step 4 — Pick emission factors you can defend

An emission factor converts activity data into emissions. Defensible means: published source, correct geography, correct year, documented in the inventory. The usual references:

• IPCC Emission Factor Database (EFDB) — the international default for fuels and processes.
• UK Government (DEFRA/DESNZ) conversion factors — updated annually, free, widely used far beyond the UK for transport, waste, and materials.
• US EPA GHG Emission Factor Hub and eGRID — US fuels and regional grid electricity.
• National grid factors for your electricity market — for example the official annual grid-average factors published by national authorities (China’s Ministry of Ecology and Environment launched a national GHG emission-factor database in 2025).
• Supplier-specific factors where you have them — a supplier’s verified product footprint beats any average.

For electricity, the GHG Protocol’s Scope 2 guidance (widely applied alongside ISO 14064-1) expects dual reporting: a location-based figure using the grid average, and a market-based figure reflecting your contracts (green tariffs, RECs, PPAs).

Step 5 — Calculate: AD × EF × GWP

The core arithmetic is simple:

emissions (tCO₂e) = activity data × emission factor × GWP

GWP (global warming potential) converts non-CO₂ gases to CO₂e. Use the GWP set your reporting program mandates and say which one you used — IPCC AR6 100-year values put fossil methane at 29.8 and N₂O at 273, while many programs still fix AR5 or AR4 values. Mixing GWP vintages across sources is a classic verification finding.

Do the calculation somewhere that preserves the chain from source document → activity data → factor → result. That chain is the difference between a number and an auditable number.

Step 6 — Set a base year and manage quality

Pick a base year with complete, representative data and recalculate it when structural changes (acquisitions, divestments), methodology changes, or discovered errors move it beyond your documented significance threshold. Alongside it, write the two short documents that make year two cheaper than year one: a data-quality / uncertainty note (which figures are measured, which estimated, and how confident you are) and an inventory management plan (who collects what, when, from where).

Step 7 — Assemble the report

An ISO 14064-1 report states, at minimum: the organization and the person responsible; the reporting period; organizational boundaries and the consolidation approach; reporting boundaries and significance criteria; quantification methodologies and any changes; emissions by category and by gas, in tCO₂e; the base year and any recalculations; uncertainty; and a statement that the report was prepared in accordance with ISO 14064-1. If the inventory will face third-party verification (ISO 14064-3), agree the level of assurance and materiality with the verifier before you finalize — see the companion guide on inventory vs verification.

Common mistakes that fail verification

• Refrigerant top-ups (fugitive HFCs) missing from category 1 entirely.
• Scope 2 reported market-based only, with no location-based figure.
• Emission factors with no source, no year, or the wrong country’s grid.
• Excluded sites and sources with no documented justification.
• Activity data that can’t be traced back to a document.
• Unit errors and GWP-set mixing.

None of these are hard to avoid — they are all versions of the same failure: losing the link between the number and its evidence. Keep that link and the rest of the inventory follows.