For growing companies, understanding where greenhouse gas emissions are concentrated is both a sustainability priority and a business intelligence challenge. As companies expand — adding new offices, hiring more staff, expanding their supply chain — emission hotspots can shift quickly. Identifying them accurately is the prerequisite for effective reduction.

This article explains how to identify emission hotspots in growing companies and what to do once you’ve found them.

What is an emission hotspot?

An emission hotspot is a category, activity, or supplier that accounts for a disproportionately large share of a company’s total greenhouse gas emissions. Common hotspots for mid-market companies include:

• Purchased goods and services (Scope 3 Category 1) — often the largest category
• Business travel — especially air travel
• Employee commuting
• Cloud computing and digital infrastructure
• Freight and logistics
• Specific high-emission suppliers

The 80/20 rule often applies: a small number of categories or suppliers account for the majority of emissions. Hotspot identification is the process of finding them.

Step 1: Complete a baseline emissions inventory

You can’t find hotspots without a complete emissions inventory. Start by measuring Scope 1, 2, and 3 emissions across all relevant categories. For growing companies, Scope 3 is usually dominant — particularly purchased goods and services.

Use a spend-based approach for your first inventory if activity data isn’t available. This gives you a fast baseline that’s good enough to identify where your big emissions are. See our guide on measuring your company’s carbon footprint for the full methodology.

Step 2: Analyze by category and supplier

Once you have your emissions inventory, analyze it at two levels:

• By Scope 3 category: Which of the 15 GHG Protocol categories is largest? For most companies it’s Category 1 (purchased goods/services) or Category 6 (business travel).
• By supplier or spend category: Within your largest Scope 3 categories, which suppliers or spend categories drive the most emissions? A handful of high-emission suppliers typically dominate.

Coolset’s platform provides this analysis automatically, ranking categories and suppliers by emission contribution.

Step 3: Prioritize by impact and controllability

Not all hotspots are equally actionable. Prioritize based on two dimensions: emission magnitude (how big is the hotspot?) and controllability (how much influence do you have over it?).

Categories where you have direct control (energy, travel) are easier to act on quickly. Supply chain hotspots require supplier engagement and are harder to address, but often represent the largest reduction opportunities.

Step 4: Build targeted reduction initiatives

Once you’ve identified and prioritized hotspots, develop specific reduction initiatives for each:

• Energy hotspots: switch to renewables, improve efficiency
• Travel hotspots: implement travel policy, replace flights with trains or video calls
• Supplier hotspots: engage key suppliers, switch to lower-emission alternatives
• Logistics hotspots: optimize routing, shift to lower-emission modes

See our guide to 9 decarbonization methods to reduce supply chain emissions for practical approaches to the most common hotspots.

How Coolset supports hotspot identification

Coolset’s carbon accounting platform automatically identifies emission hotspots from your spend data, ranking categories and suppliers by their emission contribution. The platform supports hybrid calculation approaches — combining spend-based estimates with activity-based data for your most material categories. Book a demo to see it in action.