Estimating GHG emissions from cloud computing: sources of inaccuracy, opportunities and challenges in location-based and use-based approaches

Ian Varela Soares, Masaru Yarime and Magdalena M. Klemun

Climate Policy, 2025, vol. 25, issue 9, 1335-1353

Abstract: Allocating cloud computing greenhouse gas (GHG) emissions is essential for distributing responsibility for climate damages and informing strategies to reduce data center energy consumption and Scope 2 emissions. However, few studies investigated the practical usability of common GHG accounting frameworks for estimating cloud emissions at the national level. This study characterizes four sources of inaccuracies in estimating cloud-related GHG emissions and proposes three targeted interventions to address accounting risks. This work identifies estimation risks for Scopes 2 and 3 emissions when scaling organizational emission inventories of cloud consumers (carbon importers) and cloud hosts (carbon exporters) to national emission inventories. Current practices, which assign emissions based solely on the physical location of the emitting source, e.g. data centers, fail to account for the geographical separation between cloud operation and use. This may lead to an underestimation of total cloud-related GHG emissions and a disproportionate allocation of these emissions to carbon exporters. To mitigate these risks, this study introduces a use-based emissions attribution model, which allocates emissions based on cloud service consumption patterns and operational activities. The study also outlines three specific policy interventions to implement this approach: (i) stricter emission accounting rules, (ii) eco-labeling, and (iii) carbon border adjustment.Stricter reporting requirements (e.g. operational data measurement) could help produce more accurate estimates of cloud-related GHG emissions, if compliance issues due to overly technical reporting requirements can be avoided and stakeholder opposition proactively managed.Eco-labeling is a supplementary tool that can be paired with several policy interventions, yet its success relies on the capacity to balance the technicality of information with broad outreach.Cross-border pricing can reduce carbon leakage risks arising from cost imbalances. However, when there are limited price gaps between carbon importers and exporters, it likely has limited effects on the ICT sector.

Date: 2025
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DOI: 10.1080/14693062.2025.2450054

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