Accounting for carbon emissions is too often a game of smoke-and-mirrors. Averages, estimates and offsetting are a fertile environment for untrustworthy data. Against this backdrop, efforts by the GHG Protocol to set clearer guardrails around emissions reporting associated with power consumptions (Scope 2) are enormously welcome.
GHG Protocol Standards are the most commonly used measurement standards worldwide for reporting of GHG emissions. Critically, they are the benchmark used in many reporting regulations and standards, including IFRS Sustainability Disclosure Standards and European Sustainability Reporting Standards. So, in short, they matter.
In 2025, the GHG Protocol proposed tightening measurement to ensure a closer linkage between a entity’s actual emissions from power consumed and any offsetting it achieves via virtual power purchase agreements and the like. This was to stop emission offsets being used to give a potentially false impression that an entity’s power was not generating emissions.
In the end, while a tonne of carbon is fungible – and we are not picky about where it gets reduced, so long as we see it coming down – we do need to stop treating renewable certificates as negative emissions that can offset real emissions elsewhere. Renewables don’t suck emissions out of the atmosphere; they are simply not adding to the stock.
To underscore our support for the GHG Protocol’s proposals, which are being reviewed following a consultation, we have joined other investors in supporting a public letter to the Chair of the GHG Protocol’s Steering Committee and Independent Standards Board. The new standards are expected to be finalised in 2027.
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