Rapid, deep emission cuts: A focus of the Net-Zero Standard is making rapid and deep cuts to value-chain emissions. This is the most effective and scientifically proven way of limiting global temperature rise to 1.5°C. The standard covers a company’s complete value chain emissions, including those produced by their own processes (scope 1), purchased electricity and heat (scope 2), and generated by suppliers and end-users (scope 3). Under the standard, most companies will require deep decarbonization of 90-95%.
Understanding the difference between each of the scopes of emissions:
- Scope 1 emissions: Include direct emissions from a company’s owned or controlled sources:
- On-site energy (natural gas and fuel, refrigerants)
- Emissions from combustion in owned or controlled boilers
- Company vehicle emissions
- Scope 2 emissions: The indirect emissions tied to energy purchased or acquired by the company.
- Scope 3 emissions: Emissions resulting from assets not owned or controlled by the reporting organization, but the organization impacts indirectly as part of their value chain. Scope 3 emissions are divided in the following way:
- Upstream emissions: The indirect greenhouse gas emissions produced in the manufacturing of any purchased or acquired tangible goods or intangible services.
- Downstream emissions: Indirect GHG emissions within the company’s value chain, produced because of sold goods and services after leaving the company’s ownership or control.
Set near- & long-term targets: Companies must set both near-term and long-term science-based targets. This involves making rapid emissions cuts from the outset, halving emissions by 2030. With close to zero emissions, neutralizing any residual emissions that can’t be eliminated by 2050.
Claim Net-Zero once long-term targets are met: A company can claim Net Zero when it’s achieved its long-term science-based target. Which involves cutting emissions by at least 90-95% by 2050. The company must also use carbon removals to neutralize any emissions that cannot yet be eliminated.
Go beyond the value-chain: Companies are recommended by the SBTi to invest outside achieving their own science-based targets to help mitigate climate change elsewhere. This is in addition and not in place of deep company emission cuts. The focus should begin inwards with one’s own value chain.