In greenhouse gas (GHG) accounting and life-cycle assessment, there are two primary ways to calculate emissions from procured electricity. The Location-Based Method uses a grid average emissions factor, reflecting the aggregate emissions intensity of the electricity system, while the Market-Based Method uses contractual instruments, such as EACs, and a residual mix emissions factor. Most organizations report both figures, in line with global dual-reporting standards, highlighting the importance of having reliable and transparent grid emission and residual mix emission data available.

At a high level, the concepts behind grid mix and residual mix are straightforward. A grid mix represents all electricity generated within a defined system, broken down by technology or fuel type. A residual mix, on the other hand, represents the portion of that electricity that remains after all contractual claims, such as EACs, have been removed, effectively capturing the unclaimed or untracked attributes of grid-supplied power.

In practice, calculating these mixes can be complex. Differences in methodologies, data sources and latency, and accounting rules can lead to variations in both grid and residual mix outcomes. To support consistency and avoid double-counting, it is essential that methodologies are clearly defined, transparent, and aligned around common principles. 

For more information on renewable electricity procurement, you can view the I-TRACK Foundation’s report, created in collaboration with the UNDP, or the RECS Energy Certificate Associations publication.