How should I classify chilled water purchased for air conditioning units?

Different treatments explained

According to the GHG Protocol, if the chilled water is purchased from a third party district cooling provider, it is treated like purchased electricity or steam. In that case, emissions from chilled water consumption are reported in Scope 2. This is because district cooling is explicitly included alongside purchased steam, heat, and cooling in Scope 2 guidance.

If the chilled water is produced on site using equipment you own or control, the classification changes.
• Fuel burned on site to run chillers belongs in Scope 1.
• Electricity used to run electric chillers belongs in Scope 2.
There is no separate Scope 3 treatment in this scenario.

If the chilled water is produced off site but not through a formal district cooling utility, things get more nuanced. For example, if a landlord operates a central chiller plant and passes cooling costs through to tenants without it being considered a utility service, many organizations still treat this as Scope 2 by analogy to purchased heat or cooling. However, some take a conservative approach and place it in Scope 3 Category 1 or Category 3 depending on contract structure. 

Trace recommendation

• Purchased chilled water for air conditioning from a district or shared cooling system is Scope 2.

• If you're unsure about the supplier or only have expenses data, not activity data (litres), place in Scope 3.

The key is to be consistent and transparent.