Net-zero is a term meaning to get to zero emissions, there is no current standard on what getting to net-zero means. For governments a net-zero target is one that covers all scope 1 emissions in their jurisdiction. For business it usually covers scope 1 and 2 emissions, although some companies also include some scope 3 emissions. The Science Based Targets Initiative is currently working on a standard for companies. More Emissions is the buzzword of 2021 and, in the lead, up to COP26 in Glasgow, companies, cities, and countries are setting and announcing net-zero targets.
There is broad recognition, that in order to avoid the worst effects of climate change, global temperatures need to stay below 1.5°C. In order to have a 50% chance of not exceeding 1.5°C, global emissions need to halve by 2030 and reach net zero by 2050.
Whilst the science is clear, what isn’t clear is what it actually means to set a net-zero target.
“The Net-Zero Standard gives companies a clear blueprint on how to bring their net-zero plans in line with the science, which is non-negotiable in this decisive decade for climate action. Because we are running out of time.”Johan Rockstrom, Director of the Potsdam Institute for Climate Impact Research (PIK) and Professor in Earth System Science at the University of Potsdam
The Intergovernmental Panel on Climate Change More defines net-zero emissions as being when “anthropogenic emissions of greenhouse gases to the atmosphere are balanced by anthropogenic removals over a specified period”, however, this is net-zero emissions as defined from a global level, and there is a lack of consistency about what it means on an individual organisation level.
It is seen that net-zero emissions targets being adopted by businesses don’t align on the timeframe for reaching net-zero, the inclusion of other greenhouse emissions than CO2e, and the extent of the emissions boundary. A critical piece of science-based target setting is halving emissions by 2030.
But wait, why is it important to immediately and rapidly reduce emissions now or within next 10 years?
We are given a carbon budget to limit temperature warming and the longer we wait to act, the wider the temperature range. The IPCC AR6 Report determined that we have a total carbon budget of 500 Gtonnes of CO2 to give the world a 50% chance of keeping temperatures below 1.5 degrees C – we need urgent action now to reduce emissions and must reach net-zero carbon emissions no later than 2050.
On 28 October, the The science based targets initiative (SBTi) is a partnership between CDP, the United Nations Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF). Targets are considered ‘science-based’ if they are in line with what the latest climate science deems necessary to meet the goals of the Paris Agreement – limiting global warming to well-below 2°C above pre-industrial levels and pursuing efforts to limit warming to 1.5°C. SBTi has specific sectoral guidance and is working on a Net-Zero standard. More Initiative (Science Based Targets initiative More) launched the world’s first-ever corporate framework for net-zero target setting. This standard provides guidance, criteria, and recommendations companies need to set science-based net-zero targets consistent with limiting global temperature rise to 1.5°C.
Here are the four key elements of the Net Zero Standard Framework:
- To set near-term science-based targets: 5-10 year emission reduction targets in line with 1.5°C pathways
- To set long-term science-based targets: Target to reduce emissions to a residual level in line with 1.5°C scenarios by no later than 2050
- Beyond value chain mitigation: In the transition to net-zero, companies should take action to mitigate emissions beyond their value chains. For example, purchasing high-quality, jurisdictional A carbon offset created from reducing emissions from deforestation and forest degradation (REDD) in developing countries under the UNFCCC framework. Several REDD+ projects have been registered under the Verra VCS. credits or investing in direct air capture (Direct air capture (of CO2) using technology, not nature-based solutions. More) and geologic storage
- Neutralization of residual emissions: GHGs released into the atmosphere when the company has achieved their long-term SBT must be counterbalanced through the permanent removal and storage of carbon from the atmosphere
This is exciting news as it’s the first time the SBTi has clarified the acceptable level of genuine decarbonisation and carbon offsets permitted within a science-based net-zero target. The SBTi is also committing to working closely to set standards for monitoring, reporting and verification, with more expected policies around what and how to report.
The difficulty for many companies is the strategic process behind emissions reduction, both in planning and implementation. At Northmore Gordon, we will get you started on the right foot and can provide ongoing support to make sure that you reach your target goals. We’re all in this together, you can feel confident that support is available to assist you on your Net-Zero journey.