Since the introduction of the GHG Protocol’s new guidance on Scope 2 emissions in 2015, companies have had the opportunity to report the emissions associated with their electricity consumption in a way that more accurately reflects their purchasing choices; the market-based approach.
This means electricity obtained from a low-carbon supplier can now be reflected in your Scope 2 reporting. However, there has been a lot of confusion on how to calculate and report market-based emissions, particularly when it comes to purchased renewable electricity.
Under the market-based approach to the GHG protocol, companies can use supplier-specific emission factors when reporting energy consumption. This reflects the carbon footprint associated with the electricity that a company is purchasing rather than what is produced locally. This is with the hope that incentivised by the reduction in their Scope 2 emissions, companies will purchase electricity from low-carbon suppliers, and in turn drive a greater supply of low-carbon energy.
In this guide, Greenstone, a leading provider of sustainability, supply chain and ESG software solutions, explains how best to report Scope 2 market-based emissions as defined within the GHG protocol. We explain the market-based methodology, the role of energy attribute certificates and what to do if you are using green tariffs. We also give you some examples and outline the potential benefits of the market-based approach and the ease with which it can be incorporated into your current reporting frameworks.
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Through its software and supporting services, Greenstone enables its clients to accurately measure and report GHG emissions across their organisation. With an accurate GHG emissions footprint, organisations can set reduction targets and closely monitor GHG emissions over time.