As AI becomes part of everyday business operations, companies are increasingly being asked: what’s the environmental cost? Whether you’re working toward ESG goals or preparing for climate disclosures, measuring AI’s impact is essential.

What to measure:

• Carbon emissions from usage (Scope 3 if using 3rd party tools like ChatGPT, Copilot, etc.)
• Water use from data center cooling
• Energy consumption if operating models in-house

Methods:

• Spend-based approach: Estimate impact based on software spend and known emissions factors.
• Usage-based approach: Track number of queries or compute hours used.
• Browser extensions/tools: Some tools help track AI use across platforms.

Why it matters:

• Meet climate disclosure standards (SBTi, CDP, SEC rules)
• Inform procurement decisions
• Identify opportunities to reduce usage or switch to lower-impact providers

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