Leasing an asset out does not take it out of your inventory. The lease type and your consolidation approach decide where it goes. Whether leasing is your core business does not.

Under financial control, a landlord's tenants' energy in buildings leased on operating leases is the landlord's Scope 1 and 2. A hire company's equipment on operating leases stays in its Scope 1. That is the lessee's operation, but it counts in the lessor's inventory.

Base building services that a landlord runs itself are in its Scope 1 and 2 under both approaches.

Lessors already classify every lease as finance or operating under AASB 16, using the risks-and-rewards test. See Leased premises, vehicles and equipment.

Trailhead Rentals owns its camping trailers and kayaks. It hires them to the public for a few days at a time. Each hire is a short operating lease. Bluegum uses financial control, so the fleet on hire stays in Bluegum's Scope 1 and 2.

The trailers and kayaks have no engines and use no energy on hire. They add nothing to Scope 1 and 2 while they are hired out.

Trailhead's own operations are Scope 1 and 2 under both approaches. Bluegum acquired Trailhead on 1 March 2026, so it counts March to June 2026 only. See Buying, selling or closing part of the business.

Under operational control, the hirers operate the fleet while it is on hire, so the fleet on hire would be Category 13. The figure would still be 0 tCO2e.

The numbers change when the fleet has engines. Suppose Trailhead also hired out 20 petrol generators, and refilled each one on return.

Under financial control, that is Bluegum's Scope 1, although the hirers ran the generators. Under operational control, it is Category 13.

Category 13 under every approach.

Suppose Summit Packs leased an old cutting line to a contract manufacturer on a 5-year finance lease, with ownership passing at the end. The manufacturer reports that the line used 40,000 kWh in FY26.

40,000 kWh × 0.8 kg CO2e/kWh = 32,000 kg = 32 tCO2e in Category 13.

Yes. A lessor may report leased products in Category 11 (use of sold products) instead of Category 13 if it treats them like products sold (Scope 3 Standard, Category 13). Report each asset in one category, never both.

Category 11 counts the expected lifetime emissions of the products leased in the year, all in that year. For the cutting line with 8 years of expected life left:

40,000 kWh a year × 8 years × 0.8 kg CO2e/kWh = 256,000 kg = 256 tCO2e in Category 11 in FY26, and nothing in later years.

The option only applies to assets that would otherwise be in Category 13. Assets in your Scope 1 and 2 stay there.

Split it. The part you occupy follows the rules for leased-in assets. The part your subtenant occupies goes to Category 13. Do not count it in Category 8 as well.

Suppose Bluegum sublet 100 m2 of its 800 m2 head office floor. The building uses 300,000 kWh, with 4,800 m2 occupied:

Under financial control, neither part is in Scope 1 and 2, because Bluegum does not own the floor or hold it on a finance lease.

This is a judgement. Record it in your boundary document and discuss it with your auditor.

The methods are the same as for Category 8 (Scope 3 Technical Guidance, Category 13):

If a tenant's or hirer's figures cover a different 12-month period from yours, you can use them if they are the most recent figures you can get without undue cost or effort. Disclose any significant event between the two period ends that changes the emissions (AASB S2 B19).

Write a data clause into new leases and hire agreements. For many tenants, send one survey with the same questions to each. Under financial control, operating-lease data is Scope 1 and 2 data, so keep the same evidence as for your own sites.