Tier 1 vs Tier 2 vs Tier 3 Emission Factors: How Good Is Your Data, Really?

Published 2026-05-06.

Two companies can report the same Scope 1 emissions and have wildly different data quality. The IPCC tier system gives you a vocabulary to talk about it.

The three tiers

Tier	What it uses	Relative uncertainty	Example
Tier 1	Default IPCC factors + national activity data	Highest	Diesel × 2.68 kgCO2e/L
Tier 2	Country or technology-specific factors + activity data	Medium	Diesel factor using India-specific fuel properties
Tier 3	Direct measurement or facility-specific factors	Lowest	CEMS-measured stack CO2 + flow

When each tier is acceptable

Tier 1: First baseline, screening, internal use
Tier 2: CDP and CSRD reporting, most CBAM transitional-period reports
Tier 3: EU ETS installations, ISO 14064-3 reasonable assurance. CBAM actual emissions (definitive period from 2026) must be installation-specific, though default values remain available

The MSME progression path

Year 1: Tier 1

Use default IPCC + DEFRA factors. Senseible defaults to Tier 1 with full traceability.

Year 2: Tier 2

Apply the latest CEA grid factor. Use BEE-published industry-specific intensities. Incremental cost: minimal.

Year 3+: Tier 3

For your largest emission source only. Install fuel meters on top three boilers. Use stack CEMS for CPCB-flagged sources.

Data quality scoring

The Pedigree Matrix (Weidema 1996, used in Ecoinvent) scores five attributes 1–5:

Reliability
Completeness
Temporal correlation
Geographical correlation
Technology correlation

A score of (1,1,1,1,1) is gold standard. Many MSME baselines start in the middle of the range. Aim to improve one number per year.

Auditors tend to accept Tier 1 in year 1 but expect improvement over time. The trajectory matters more than the level.

What to document

For every emission factor used: source, publication year, geography, technology assumption, uncertainty estimate. The compliance ledger in your dashboard captures this automatically.