Companies will have a standardised method to report emissions from low-carbon electricity purchases for the first time, following the publication of updated greenhouse gas (GHG) reporting standards.
The GHG protocol scope 2 guidance, published by the World Resources Institute (WRI) today, provides a framework for disclosing how different types of electricity purchases count towards a company’s emissions targets.
The WRI hopes that it will inform corporate decisions on what kind of energy should power their business.
Companies have many choices for buying low-carbon electricity, such as renewable energy certificates, electricity contracts, onsite or offsite renewable energy and power purchase agreements.
These can all vary country by country, making it difficult for companies to account for such emissions in reports and investors to benchmark performance. Corporate investment in renewable energy has been impeded by this uncertainty, the WRI says.
The institute highlights several applications the guidance can be used for:
• corporations can compare electricity procurement choices based on their emissions profile and set science-based GHG reduction targets;
• utilities can calculate and disclose accurate carbon footprint performance to customers; and
• industry associations can use the framework to set sector-wide targets and compare performance of firms across the sector.
Its report also showcases 12 companies that have already used the new guidance, including Mars, Facebook, Google and EDF Energy.
Kevin Rabinovitch, global sustainability director at Mars, said: “With the wide range of options for supplying renewable energy both on and offsite, this updated guidance is a welcome addition to the GHG protocol that will accelerate progress.”
The guidance helped Mars decide to build a 200MW wind farm in the US last year, he added.
The CDP, Climate Registry and other reporting programmes will require thousands of companies to provide extra information about their scope two emissions using the new guidance.
Pedro Faria, technical director of the CDP, said that the guidance represented a “critical evolution” in corporate sustainability reporting.
“Investors and other stakeholders have been calling for companies to disclose more consistent, transparent data on their electricity emissions and renewable energy purchases. By using this guidance, companies reporting to CDP can now achieve this,” he said.
