If the company uses a methodology inferior to direct measurement to quantify emissions, what are the reasons for choosing this methodology? If estimates are used, please specify the standard, sectoral study, or sources that form the basis of these estimates, along with the degree of uncertainty and the range of estimates reflecting the measurement uncertainty.

When your company uses an inferior methodology (compared to direct measurement) to quantify emissions, or when estimates are used, you must clearly outline the reasons for these choices and provide relevant contextual information. Here’s how to structure this disclosure: 1. Reason for Using Inferior Methodology: Explanation of Methodology Choice: Describe why an inferior methodology was chosen instead of direct measurement for quantifying emissions. This could include reasons such as: Cost considerations: Direct measurement systems may be too expensive to implement across all facilities. Practical limitations: Certain pollutants may be difficult to measure directly due to the nature of operations or the complexity of the measurement equipment. Lack of infrastructure: In some cases, your company may not have the necessary infrastructure or resources to support continuous direct monitoring. Regulatory or industry standards: The chosen methodology might be aligned with accepted industry practices or regulatory requirements that prioritize estimation methods over direct measurement in certain scenarios. 2. Basis of Estimates: Sources and Standards Used for Estimates: If your company uses estimates to quantify emissions, disclose the standard, sectoral study, or data sources used as the basis for the estimates. This might include: Industry benchmarks: Established emissions factors used in your sector. Sectoral studies: Reports or research conducted by industry groups, NGOs, or regulatory bodies that provide typical emission factors or data points for your industry. Regulatory guidance: If using estimates based on local or international regulations (e.g., EPA standards, European Environmental Agency reports). Uncertainty and Range of Estimates: Provide information on the degree of uncertainty in the estimates, including: The uncertainty range (e.g., +/– a percentage or a margin of error) due to the limitations of the estimation method. Explain how the uncertainty is reflected in the estimates and whether a range is provided to show the potential variation in emissions. 3. Contextual Information: Data Limitations and Justifications: It’s important to disclose any limitations or potential biases in the estimates due to the chosen methodology. For instance, certain emissions factors may not fully capture specific operational variations, or external conditions may affect emissions unpredictably. Provide justifications for why the chosen approach is still deemed reliable and valid for reporting purposes, given the constraints of direct measurement. https://xbrl.efrag.org/e-esrs/esrs-set1-2023.html#1385