Tag Archives: Scope 2

CDP Climate Change – revised questionnaire for 2016 and new scoring methodology


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The CDP (Carbon Disclosure Project) has updated its methodology for the year 2016 regarding the CDP Climate Change questionnaire.

What is CDP?

Through CDP, around 6,000 organizations disclose their greenhouse gases emissions and other environmental KPIs, on the request of the shareholders or their clients. Through measurement, organizations are expected to better manage climate change mitigation.

What are the main changes?

  • Change in Climate Change scoring methodology. There will no longer be a disclosure score and a performance band, but one score, which will be located on a four-band scale: leadership (A), management (B), awareness (C), disclosure (D), like already introduced for the CDP water program in 2015. Answers to the CDP questions may be eligible to points in the four scoring categories disclosure, awareness, management, leadership. At least 75% of points must be scored on a certain scoring level in order to advance to the next higher lever.
  • Alignment with GHG protocol for Scope 2 emissions. Organizations now need to explain if the figures are market-based or location-based. Location-based means that the calculation is based on a figure reflecting the geographical electrical grid. For market-based, this figure reflects the emissions of the product, or the supplier. As figures need to be comparable, organizations need to select one of the option and convert the figures from the 2015 report or figures for the new 2016 report accordingly
  • Renewable energy. Organizations have now the possibility to report their renewable energy production and consumption, as well as any renewable energy targets.
  • Science-based targets. Company now need to specify whether their reduction target is science-based, meaning in alignment with climate science recommendations and scenarios, to keep global warming below 2°C.
  • Management fee: Companies from North America and Western Europe responding in the CDP Investor Program will be charged a management fee to contribute to the funding of the CDP project. The basic fee is set at 2.475 EUR, with the option to make a higher contribution, or to choose a subsidized, lower fee. First-time responders, as well as companies responding to their customers via the Supply Chain Program do not need to pay a fee.

For more information, please consult:

Changes & Rationale Document: https://www.cdp.net/Documents/Guidance/2016/CDP-Climate-Change-changes-document-2016.pdf

CDP 2016 Climate Change scoring methodology Introduction:  https://www.cdp.net/Documents/Guidance/2016/CDP-climate-change-scoring-methodology-2016.pdf

Scoring introduction 2016: https://www.cdp.net/Documents/Guidance/2016/Scoring-Introduction-2016.pdf

Accounting of scope 2 emissions: https://www.cdp.net/Documents/Guidance/2016/CDP-technical-note-Accounting-of-Scope-2-Emissions-2016.pdf

As a CDP official partner, the DFGE is happy to provide more details on these changes and help your organization adapt to them. With our in-depth CDP Response Review, you can make sure you cover all requirements from the new questionnaire and scoring methodology. Please contact us at info@dfge.de or +49.8192.99733-20

 

 

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Greenhouse Gas Protocol: Neue Scope 2-Guidance veröffentlicht


Financial Planning Pen and Calculator

Nach langen und teils intensiven Abstimmungen hat das Greenhouse Gas Protocol nun seine finalen Richtlinien für die Berechnung von Scope 2-Emissionen vorgestellt.

(http://www.ghgprotocol.org/scope_2_guidance ).

Die DFGE war als Mitglied der GHG Protocol Stakeholder-Gruppe an der Entwicklung und Abstimmung beteiligt

Das Greenhouse Gas Protocol (GHG Protocol) ist eine Initiative von WRI und WBCSD, die einheitliche und detaillierte Standards für die Berechnung von Treibhausgas-Emissionen erarbeitet.

Als Scope 2 bezeichnet man dabei alle Emissionen, die indirekt durch den Energiebezug von Unternehmen oder Organisationen entstehen – also beispielsweise bei der Strom- oder Fernwärmeproduktion in Kraftwerken.

Problem: Zuordnung der Energieproduktion

Größter Diskussionspunkt ist hier die Berechnung der zugehörigen Emissionen. Je nach dem, wie der Strom erzeugt wird (z.B. erneuerbar vs. fossil, Braunkohle- vs. Gaskraftwerk) fallen mehr oder weniger Treibhausgas-Emissionen pro kWh an – der sogenannte Emissionsfaktor. Continue reading

Scope 2 Accounting – treatment of green power


An increasing number of companies tend to purchase or even generate green power. Today the focus is mainly on green electricity out of renewable sources or considered as low-carbon or “carbon free” electricity. Despite some clear physical basic conditions it is fact that there are market instruments and technologies out there. These instruments should make a clear difference – it should not only be a calculation trick but should generate a real shift towards a greener power supply infrastructure. This can also be understood as additionality: (according to the IPCC/CDM §43) “an activity is additional if anthropogenic emissions of greenhouse gases by sources are reduced below those that would have occurred in the absence of the activity” compared to a business-as-usual scenario.

GHG protocol

The GHG protocol adressed this in the new Scope 2 Accounting Guidelines (Clarifying the treatment of green power instruments) which is also available as PDF draft for public comments. (issued March 2014)

What issues are adressed in the new guide?

  • Attributes and Intended Uses
    • Identifying the emissions attributes contained in renewable energy instruments and purchasing mechanisms
    • Identify intended uses of instrument, including as: means of impacting emissions calculation in end-user scope 2 inventories; mechanism for energy supplier disclosure; tracking instrument for supplier quotas, etc.
  • Quality Assurance of Renewable Energy Instruments
    • Identifying requirements for renewable energy purchasing mechanisms such as clear statement of attributes, prevention of double counting (see below), approval for use by reporting or governmental program, appropriately matching vintage of instrument with annual scope 2 calculation, etc.
  • Double Counting
    • Preventing explicit double counting of emission attributes through use of certificate registries and tracking systems
    • Preventing implicit double counting of emission attributes through adjustment of other calculation sources and mechanisms used in scope 2 accounting
    • Identifying best practices for treatment of “null power” where certificates have been sold from generation
  • Overlapping Power Sector Policies
    • Surveying regional approaches to accounting for renewable energy purchasing within an emissions- capped power sector
  • Additionality and Eligibility
    • Identifying the range of reporting program and consumers expectations about the full environmental and market impacts of renewable energy purchasing mechanisms and their ability to drive new renewable development
    • Distinguishing these expectations from the core criteria necessary
  • Calculation and Reporting
    • Identifying appropriate calculation and reporting procedures for reflecting renewable energy attribute ownership in scope 2 of a GHG inventory

(Source: http://www.ghgprotocol.org/feature/ghg-protocol-power-accounting-guidelines)

The final publication is scheduled for fall 2014. DFGE is also part of the WRI/GHG stakeholder group.

CDP

The CDP reporting is also adressing this topic with the recent 2014 CDP climate change reporting guidelines. Companies are able to report on “Purchased and consumed low carbon electricity, heat, steam or cooling” based on the following assumptions:

“Purchased and consumed low carbon electricity, heat, steam or cooling (MWh)” should be used to disclose the amounts of electricity (and heat, steam or cooling) that was accounted at a zero emission factor (0 tCO2e/MWh) or that can be considered “low carbon” and that are supported by appropriate tracking instruments. This means that any portion of electricity (and heat, steam or cooling) that comes from renewable/low carbon sources and is incorporated into a distribution grid average/residual mix, and that is not backed by some kind of instrument retired by the company, or by someone on their behalf should not be counted.

Source: CDP climate change reporting guidance 2014, page 128

What is considered as “low carbon” for CDP?

“Unfortunately there is no precise, generally accepted definition of what “low carbon energy” is. No definition is found also in the GHG Protocol standards or ISO. Nevertheless, it can be reasonably established that “low carbon energy” will be any type of energy that will have no direct emissions and which the indirect emissions can usually be considered as negligible considering the life cycle of the given technology. It is generally accepted as such power technologies like wind, solar, tidal, geothermal and most hydro power. Nuclear power is also usually considered low carbon, although other considerations make it a more contentious technology. Natural gas, combined cycle gas turbine and Combined Heat and Power (cogeneration), despite being less carbon intensive than other means of electricity production like coal, are not considered here in the definition of low carbon.”

Source: CDP climate change reporting guidance 2014, page 129

What is considered as Appropriate tracking instrument?

“Tracking instruments can have different names depending on the specific system they originate from. They can be designated as a “certificate”, “tags”, an “instrument”, “credits”, a “guarantee of origin”, etc. For the purpose of this guidance we will use “instruments” as the overarching concept for all these different designations. When accounting for renewable energy based on tracking instruments, companies should be made aware of what constitutes a good system for tracking electricity. From a CDP perspective, there are 4 simple criteria that need to be fulfilled:  There is an entity responsible for the instruments generation (issuing body) that issues the instrument in a publicly available registry(ies) against renewable energy delivered by a generator. Only one instrument is issued per unit of energy (e.g. MWh) and this link is properly audited. A set of attributes are present in the instrument (or can be legitimately inferred from it) namely: name of producer; technology type; year of installation; year of production; state support/aid; emission rate; other environmental characteristics. Properties should not be disaggregated e.g. it is not allowed for one party to count for the GHG emission factor and another party to count for the fact that it is renewable in origin.  There is an auditable chain of custody, that is, all information can be verified/audited by users in the system and the whole system is audited by external parties, guaranteeing that the link between generation, distribution and final consumption is effectively established and that there is no double counting.  The information in the system can be used to avoid the double counting of attributes. CDP will generally consider the following systems (and instruments) as appropriate for the purpose of tracking renewable electricity: Systems based on European Guarantees of Origin (GOs) such as the EECS (European Energy Certificate System).  Systems based on USA Renewable Energy Certificates such as the Green-e Energy program in the USA. In addition to the issuance, tracking of properties and guarantee of the chain of custody, there can be certification schemes that will testify for the appropriate use of an instrument for a given purpose. Further discussion of these issues as well as specific terminology can be found in the technical note “Accounting of Scope 2 emissions”, available at https://www.cdp.net/en-US/Pages/guidance.aspx.”

Source: CDP climate change reporting guidance 2014, page 97

To consider these tracking instruments is also crucial for any activities within “carbon neutral” or “carbon zero” certifications.

UK Defra

Especially in the UK there is a clear methodology which is also favored by the DFGE. Be clear on your physical emissions but consider what has been achieved to make a real difference. To ensure a transparent and valid calculation of the carbon footprint/emissions a gross/net approach can be uses.

The gross figure for emissions show the real physical emissions based on average factors. The net emissions take into account that you have a low-carbon emission factor, consider a renewable energy source (generating own electricity) or even feed-in to the grid through various technologies.

More details on the gross/net or the gross/gross approach of the UK DEFRA can be found here.

Read more about the UK government “Environmental Reporting Guidelines: including mandatory greenhouse gas emissions reporting guidance“.