TRACE3 - Tracking, Reporting, and Action for Scope 3 Carbon Emissions

Motivation and Objectives

• The transition to net-zero supply chains has become a strategic necessity for Dutch industry. Although much attention is focused on Scope 1 and 2 emissions (direct emissions from own activities and energy consumption), in many sectors the largest share is Scope 3: emissions in the value chain, from suppliers to the use of products.
• For Dutch companies, particularly in the high-tech manufacturing industry, Scope 3 emissions are difficult to quantify and manage due to complex supply chains, long product life cycles and limited chain visibility.
• With the Corporate Sustainability Reporting Directive (CSRD) and other EU regulations requiring broader emissions reporting, companies must act quickly to develop practical, scalable and verifiable systems to monitor and reduce Scope 3 emissions.
• TRACE3 ties in directly with the theme of Energy Transition and Reduction of Harmful Emissions from TKI Dinalog's National Logistics Knowledge Agenda. It also ties in with one of the main objectives, sustainability, as described in the recent 2024-2027 Implementation Programme of the Top Sector Logistics.
• More specifically: reducing CO2, NOx and particulate matter emissions in order to contribute to social challenges and secure the Netherlands' future earning capacity, shifting the focus from footprinting to increasing chain efficiency with an impact on CO2, particulate matter and NOx emissions.
• The project addresses a crucial need to bridge the gap between CO2 accounting and strategy and operational implementation.

Activities / Work packages

1. WP1: Scope 3 Emission Measurement - Develops a standardised and data-driven framework to measure Scope 3 emissions by integrating machine learning, network analysis and existing accounting methods.
2. WP2: Formulating targets - Analyses the effectiveness of different strategies for setting Scope 3 emission reduction targets and develops a decision support framework to help companies define and implement Science Based Targets.
3. WP3: Strategy implementation - Designs a portfolio management approach and develops a decision support tool to help companies prioritise and combine emission reduction initiatives in their supply chains.
4. WP4: Policy support and structural incentives - Builds a quantitative model to simulate the effects of different policy interventions and provides practical recommendations to better align corporate and public sustainability goals.

Innovativeness

• From a theoretical perspective, the project strengthens academic knowledge by investigating how companies set and implement Scope 3 targets, how different reduction strategies interact, and how policy incentives influence emission decisions in complex supply chains.
• Quantitative modelling of corporate decision-making and behaviour provides new insights into the effectiveness of voluntary and regulatory interventions.
• In practice, TRACE3 expands existing methods by creating a layered data-driven measurement system, developing a decision support tool, and testing these solutions with companies.
• Thanks to the interdisciplinary design, the innovations are not only conceptually robust, but also immediately ready for implementation and upscaling, enabling Dutch industry to comply with regulations and contribute to broader climate objectives.

Valorisation strategy and implementation strategy

• Interim and final results will be shared through workshops with industry, training modules and academic publications.
• The decision support framework and recommendations will be made available to companies, regulators and networks of manufacturers/logistics parties.
• A pilot phase with Dutch companies will test the frameworks in realistic situations and provide practical examples and feedback loops.

Expected results

• A validated Scope 3 measurement framework and a decision support tool for setting, prioritising and implementing carbon reduction strategies.
• Policy recommendations to promote CSRD compliance and better coordination.