What is Spend-based Data?
A method that estimates carbon emissions based on financial expenditure in different categories. Spend-based calculations apply average emission factors to spending data, providing useful estimates when detailed activity data is unavailable.
Why it matters
Spend-based methods offer a practical starting point for SMEs that lack detailed activity records. While less precise than activity-based approaches, they provide a credible first carbon report and highlight which spending categories drive the most emissions.
Example
A design studio with no detailed procurement records exports its Xero transactions. EcoHedge categorises £45,000 of IT equipment spend and applies the relevant emission factor to estimate 12.6 tCO₂e from that category.
Related terms
Activity-based Data
Emissions data derived from specific activities such as fuel consumption, distance travelled, or energy used. Activity-based calculations provide more accurate emissions estimates than spend-based methods and are preferred for carbon reporting.
Emission Factors
Coefficients that quantify the greenhouse gas emissions produced per unit of activity. Examples include kg CO₂e per kWh of electricity, per litre of fuel, or per pound spent. DESNZ publishes UK-specific emission factors annually.
Put your knowledge into practice
Start measuring your carbon footprint with EcoHedge. Connect your accounting software and get your first carbon report in hours.