Policy update: Guidance on green power

Nick Blyth, IEMA's policy and practice lead on climate change at IEMA, describes guidance due in 2014 on reporting scope 2 emissions

Accounting and reporting greenhouse-gas (GHG) emissions is an increasingly mainstream activity for organisations and is helping stakeholders to better understand corporate performance on climate change.

Over the past two years, the World Resources Institute (WRI) has been developing new guidance on accounting for scope 2 emissions, primarily concerning grid supplied electricity, which is often the largest category of emissions for companies.

Internationally, the WRI guidance could be important in addressing a need for consistent and transparent reporting practices. In 2010, an IEMA survey of 272 practitioners, working in firms purchasing green electricity, revealed that two-thirds reported GHGs in line with grid averages, while the remaining third reported their net or gross emissions as zero.

Although Defra issued new guidance on GHG reporting in 2013, it has not finalised its approach to scope 2 emissions. The working group developing the WRI’s guidance has proposed a dual-reporting approach, requiring firms to disclose both emissions calculated against a contractual factor (this could be zero for green power) and emissions based on a grid average factor.

Many have seen this as a transparent solution enabling stakeholders to clearly see emissions against each methodology. IEMA, however, has some concerns that companies may place greater emphasis on contractual emissions than grid average emissions. An open letter circulated to the WRI working group has also fundamentally challenged contractual emissions reporting.

This year should see both draft guidance from WRI and final guidance from Defra published. IEMA will push for these approaches to be fair, transparent and credible, and will engage and consult members on developments.