Business Energy Glossary
What is carbon intensity?
Carbon intensity is the quantity of carbon dioxide (CO2) or carbon dioxide equivalent (CO2e) emitted per unit of output. Common applications include grid carbon intensity (grams of CO2 per kWh of electricity), product carbon intensity (kilograms of CO2e per unit of product), and revenue carbon intensity (tonnes of CO2e per million pounds of revenue). Carbon intensity normalises emissions for comparison across organisations, fuels, and time periods. Lower carbon intensity means less CO2 emitted per unit of activity.
Carbon intensity is a core metric in climate disclosure, supplier benchmarking, and decarbonisation tracking. Understanding the different intensity metrics matters for accurate reporting, target setting, and supply chain engagement.
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Grid carbon intensity
Carbon intensity is the amount of greenhouse gas emitted per unit of activity, such as grams of CO2e per kWh of electricity or per £ of turnover. It’s how businesses compare and report the emissions linked to their energy use under SECR and similar frameworks.
For the full explanation, see ESOS vs SECR explained.
Grid carbon intensity is the average emissions per kWh of electricity supplied:
Grid carbon intensity (gCO2/kWh) = total grid emissions / total grid generation
- UK 2000. Around 500 gCO2/kWh (mostly coal and gas).
- UK 2024. Around 200 gCO2/kWh (mostly gas, wind, solar, nuclear).
- UK 2035 target. Less than 50 gCO2/kWh (net zero electricity supply).
UK grid carbon intensity varies by half-hour as the generation mix changes. The National Energy System Operator (NESO) publishes real-time intensity data showing when the grid is greener (typically windy nights, sunny days, low demand) and dirtier (calm evenings, peak demand).
Fuel carbon intensity
Carbon intensity of common fuels (per kWh of energy):
| Fuel | Intensity (kgCO2/kWh) |
|---|---|
| Natural gas (combustion) | 0.183 |
| Coal (combustion) | 0.340 |
| Oil (combustion) | 0.260 |
| Biomass (sustainable) | 0.018 (residual) |
| UK grid electricity (2024) | 0.207 |
| REGO-backed renewable electricity | 0.000 (market-based) |
The DESNZ annual emission factor publication provides the authoritative UK fuel and electricity carbon intensities. Factors are updated each year for changes in fuel composition and grid mix.
Product carbon intensity
Product carbon intensity is the lifecycle CO2 equivalent emissions per unit of product:
- Cement: around 800 kgCO2e per tonne.
- Steel: 1.8 to 2.5 tCO2e per tonne (BOF route); 0.5 to 1.0 tCO2e per tonne (EAF route on green electricity).
- Aluminium: 4 to 16 tCO2e per tonne depending on grid intensity.
- Beef: 25 to 35 kgCO2e per kg.
- Wheat: 0.4 to 0.7 kgCO2e per kg.
Product intensity is calculated through lifecycle assessment (LCA) and reported under standards like ISO 14067 and the Product Category Rules used in Environmental Product Declarations.
Revenue carbon intensity
Revenue carbon intensity is total emissions divided by revenue:
Revenue intensity (tCO2e per £m revenue) = total emissions / annual revenue
This metric is used for:
- Comparing companies of different sizes.
- Tracking efficiency over time (intensity can fall even as absolute emissions rise during growth).
- Supplier benchmarking by purchasing organisations.
- Investor and financial reporting under TCFD-aligned disclosures.
Revenue intensity has limitations: prices and exchange rate movements affect the metric without any change in physical emissions.
Carbon intensity in reporting
UK frameworks using carbon intensity:
- SECR. Requires an intensity ratio (often emissions per £m revenue or per FTE).
- CDP. Various intensity metrics across products and operations.
- Climate-related Financial Disclosures. Includes weighted average carbon intensity for financial portfolios.
- Science-Based Targets. Often expressed as intensity targets alongside absolute targets.
Intensity metrics complement absolute emissions reporting; they should not replace it for credible disclosure.
Reducing carbon intensity
Carbon intensity reduction levers:
- Cleaner electricity. Grid decarbonisation reduces intensity of all purchased electricity.
- Fuel switching. Replacing higher-intensity fuels (coal, oil) with lower-intensity alternatives (gas, electricity, biomass, hydrogen).
- Efficiency. Reducing fuel or electricity use per unit of output.
- Renewable procurement. REGOs and PPAs reduce market-based grid intensity to zero.
- Process redesign. Lower-intensity manufacturing routes (EAF instead of BOF for steel, etc.).
Intensity reduction can occur even during business growth; absolute emission reduction requires intensity reduction to outpace activity growth.
carbon intensity FAQs
What is carbon intensity?
The quantity of CO2 or CO2 equivalent emitted per unit of output. Common applications: grid carbon intensity (gCO2 per kWh), product carbon intensity (kgCO2e per unit), and revenue carbon intensity (tCO2e per £m revenue).
What is the UK grid carbon intensity?
Around 207 gCO2e per kWh in 2024 (location-based, DESNZ annual figure). Down from around 500 gCO2/kWh in 2000 as coal has been phased out and renewables added. National Grid ESO publishes real-time intensity data showing half-hourly variation.
Why does grid intensity vary by time?
The mix of generation supplying the grid changes by hour and day. When wind and solar are abundant, the grid is greener. When gas covers demand, the grid is dirtier. Real-time intensity data shows when consumption is most carbon-efficient.
What is product carbon intensity?
Lifecycle CO2 equivalent emissions per unit of product, calculated through lifecycle assessment (LCA). Examples: cement ~800 kgCO2e per tonne, beef 25-35 kgCO2e per kg. Reported under standards like ISO 14067.
How is revenue carbon intensity calculated?
Total CO2e emissions divided by annual revenue, expressed in tonnes per £m. Used for cross-company comparison and SECR intensity reporting. Has limitations: price and exchange rate movements affect the metric without any change in physical emissions.
Does intensity reduction equal emission reduction?
Not always. Intensity can fall while absolute emissions rise if business activity grows faster than intensity falls. Credible climate targets typically include both intensity and absolute reduction objectives.
How is REGO-backed electricity carbon intensity treated?
For market-based Scope 2 reporting, REGO-backed electricity is treated as zero carbon intensity. For location-based reporting, the underlying grid intensity is used regardless of contractual arrangements.
Where do I find UK fuel emission factors?
DESNZ (Department for Energy Security and Net Zero) publishes annual UK Government greenhouse gas conversion factors covering all major fuels and electricity. The factors are the standard reference for UK Scope 1 and 2 calculations.