The Greenhouse Gas (GHG) Protocol is a framework used to determine a company’s Scope 1, 2, and 3 emissions. It is the methodology that underpins the ISSB’s GHG disclosure rules and laws like California’s SB 253. Earlier this year, the GHG Protocol considered changing its methodology for calculating Scope 2 emissions. The Scope 2 Technical Working Group (TWG) argued that the rules should be reworked regarding renewable energy certificates (RECs). The revision would restrict RECs by requiring matching hourly electricity consumption and geographic limitations. This proposal caused an uproar. Many companies argued it would derail climate efforts and restrict access to clean energy markets. After much deliberation, the GHG Protocol still has no clear path forward. However, an in-person meeting of the Scope 2 TWG is hoping to change that:
“The Scope 2 TWG will further develop proposed revisions at an in-person workshop hosted later this month. Key issues for discussion related to the market-based method include deliverability, incrementality, feasibility, and implementation timing.
The Scope 2 TWG’s proposed revisions will be sent for review and approval by the ISB prior to inclusion in a consolidated public consultation slated for Q2 2027. The consolidated public consultation will include proposed requirements for scope 1, scope 2, scope 3 and actions and market instruments as a part of the joint GHG Protocol-ISO Corporate Standard, slated for publication in Q4 2028.”
Right now, it seems the GHG Protocol is leaning towards presenting both methodologies as options for companies. For a time, companies could choose between current REC standards and the more stringent requirements. After a phase in/out period, a full transition would be made to the new requirements. We’ll see what the Scope 2 TWG lands on. Ultimately, their suggestions will face another round of public feedback. After that, we’ll see which method sticks.
Our members can learn more about calculating GHG emissions here.
