Over the last decade, emissions tracking has shifted from a sustainability checkbox to a critical business priority with direct financial implications for commercial property owners. The most successful organizations recognize these initiatives create measurable value through cost savings, increased asset value, and competitive differentiation.
King Energy’s 2024 Impact Report demonstrates how commercial solar installations help property owners address emissions while generating financial returns. By avoiding over 16,000 tons of CO2 emissions and generating $550 in energy savings since 2021, these systems deliver both environmental and economic benefits across diverse markets.
Sustainability is no longer simply a corporate responsibility, it’s a financial strategy. But to make the most of this opportunity, property owners need a comprehensive plan. Where do they begin? The first step is understanding their categorization.
What Are Scope 1, 2, and 3 Emissions?
A firm grasp of emissions classifications provides the foundation for regulatory compliance and operational efficiency. Knowing the boundaries between each enables owners to create complete strategies that maximize the financial benefits and strengthen reporting.
Scope 1: Direct Emissions
Scope 1 covers direct emissions from the sources that a property owner controls directly. For commercial properties, this includes natural gas used for heating, refrigerant from HVAC systems, and emissions from company-owned vehicles.
These direct emissions fall under the immediate operational control of the ownership, although they typically do not make up the bulk of their output. They are also typically the simplest to measure, although this varies by scale.
Scope 2: Purchased Energy
Scope 2 represents indirect emissions from purchased electricity, steam, heating, and cooling. For most commercial properties, electricity consumption constitutes the largest portion of this category.
While the carbon emissions don’t physically occur on the property, they result from energy used in areas under the owner’s control—like common areas. Property owners can have significant influence over their levels through energy efficiency measures and renewable energy adoption.
Scope 3: Value Chain/Tenant Emissions
Scope 3 encompasses all other indirect emissions throughout the value chain—namely from others within the property. For commercial property owners, this includes tenant energy consumption, emissions from construction materials and services, waste disposal, employee commuting, and business travel.
For multi-tenant commercial properties, Scope 3 typically accounts for the largest share of emissions but presents the greatest measurement challenges. Managing this Scope also requires significant collaboration between tenants and partners.
How King Energy Helps Measure and Reduce Emissions
As a solar partner, King Energy’s no-cost model provides detailed reporting and ESG support to commercial properties. Their system lays the foundation for a practical, actionable framework that addresses emissions across all three scopes.
Comprehensive Emissions Tracking and Categorization
Using data from behind the meter, a King Energy account rep works alongside ownership to categorize business activities into Scope 1, 2, and 3.
This assessment starts with a complete utility bill analysis. The company’s enterprise-grade software platform, OneBill, captures energy production and consumption data at scale. This technology enables precise tracking of avoided emissions and energy savings at a single site or across an entire portfolio.
For property owners, the software translates to reliable, accessible data for sustainability reporting. This high-level view provides insights into areas of opportunity, guides decision-making, and enables detailed reporting for stakeholders.
Simplifying Scope 3 Reporting
In addition, King Energy’s OneBill platform addresses one of the most challenging aspects of emissions tracking: tenant energy usage. By providing visibility into tenant consumption patterns, the system helps property owners report on these traditionally difficult-to-quantify Scope 3 emissions.
To provide a more accurate picture of Scope 3, King Energy reps can also conduct employee surveys to measure specific value chain emissions. This questionnaire provides ownership with unique insights into the impact of their team’s commuting, home office usage, and more.
The Business Case for Tracking Emissions
Monitoring emissions empowers property owners to unlock legal and financial benefits. These strategic advantages include:
Reduced Operating Costs
Sustainability reporting leads to energy efficiency initiatives that directly reduce expenses. King Energy’s systems have generated over $159,000 in common area energy savings alone for commercial property owners.
Enhanced Asset Value
Improved sustainability metrics allow for calculated improvements that can increase property value. King Energy solar systems has created over $110 million in added property value through solar rent payments that increase net operating income. This boosted NOI positively impacts a site’s score on the formula used for commercial real estate valuation.
Competitive Differentiation
Properties with strong sustainability credentials attract premium tenants with ESG goals—whether a corporate account or local, environmentally-concerned clientele. With 88% of King Energy’s participating tenants being small businesses, the systems clearly help property owners satisfy the growing demand for environmentally responsible space.
Regulatory Compliance
Strong emissions tracking prepares ownership to address evolving reporting mandates from local, state, or federal government bodies. With looming SEC requirements that mandate Scope 3 emissions reporting, businesses need to prepare early or risk violations.
Employee Engagement
Employees appreciate working for companies with strong sustainability initiatives. Companies with strong ESG performance have reported employee satisfaction scores 14% higher than those in the bottom quartile. This company culture has ripple effects through productivity and retention.
Challenges and Best Practices for Commercial Property Owners
At scale, sustainability reporting can be a challenging, multi-step process. Both single commercial sites and large portfolios require systematic approaches that typically necessitate a system and software partner.
While possible at any stage of development, early implementation of a measurement strategy is key. Integrating solar and storage solutions can easily unlock reporting capabilities through integrated platforms, as well as directly reduce emissions in all scope categories.
For all stakeholders, it is essential to frame emissions management as a balance between regulatory compliance and financial performance. The most effective, successful strategies focus on initiatives that generate oversight, as well as environmental and economic returns.
King Energy’s monitoring platform provides quarterly reports on energy production, savings, and environmental impact. These metrics directly support ESG reporting requirements while demonstrating progress to stakeholders.
Taking Action on Emissions Management
Commercial property owners face growing financial and regulatory pressure to address emissions across all three scopes. Understanding the distinctions between these categories enables more effective management strategies and better business outcomes.
King Energy’s approach demonstrates how commercial solar installations can reduce emissions while creating financial value. With systems generating $550,000 in energy savings and avoiding 16,000 tons of cO2 since 2021, it is clear that sustainability initiatives can deliver both environmental and economic benefits.
For commercial property owners looking to enhance sustainability performance while improving financial returns, emissions reduction through solar provides a proven pathway.
Learn how King Energy is advancing sustainability while supporting business objectives