By Kerri Metz and Priya Barua
The Science Based Targets Initiative (SBTi) in September issued a Call for Evidence on the Effectiveness of the Use of Environmental Attribute Certificates in Corporate Climate Targets, and the Clean Energy Buyers Association (CEBA) this week submitted a response that demonstrates the crucial role that market certificates have played in grid decarbonization and addressing supply chain emissions.
SBTi states that its aim in this call for evidence is to “help the corporate climate action ecosystem understand whether different instruments can credibly drive decarbonization and support corporate emission reduction claims.” CEBA encourages its members and any other interested organization to respond to this call for evidence before SBTi’s November 24 deadline.
Over the past decade, an increasing number of companies have voluntarily set clean energy commitments and taken steps to address climate change as part of their business strategy. Nearly one-third of the world’s 2,000 largest publicly traded companies have published net-zero emissions targets, and more than 90% of S&P 500 companies now publish environmental, social, and governance (ESG) reports.
SBTi, a partnership between the Carbon Disclosure Project, the United Nations Global Compact, World Resources Institute, and the World Wildlife Fund, works with various organizations to set science-based targets that are in line with Paris Agreement goals of limiting global warming to 1.5 degrees Celsius. Through collaboration with SBTi, approximately 3,900 companies have committed to setting science-based targets, and 2,590 have set net-zero commitments.
SBTi’s call for evidence encompasses all environmental attribute certificates, including energy attributes certificates (EACs) for electricity, energy carrier certificates for green hydrogen, green gas, sustainable aviation fuel certificates, emissions reduction credits, and certified commodities conveying specific emission factors, including green steel.
CEBA recognizes the significance of EACs in the global voluntary market and their crucial role as a key tool for corporate climate action. Currently, EACs are the only uniform and global market-based instrument available to companies trying to reduce their corporate greenhouse gas emissions.
In addition to their environmental impact, the revenue from selling EACs for clean energy asset developers stimulates climate finance, mitigating market risks for developers and owners. EACs also help advance the adoption of low-carbon technologies, giving corporations the opportunity to displace high-emitting activities with lower-emission alternatives.
Since 2014, energy customers have voluntarily procured more than 71 gigawatts (GW) of clean energy in the United States alone, equivalent to 42% of all wind and solar capacity added to the nation’s grid during that timeframe. In 2022, energy customers announced a record-breaking 16.9 gigawatts of new clean energy deals, equivalent to 70% of the carbon-free energy (CFE) capacity added to the grid last year. It’s important to help SBTi understand the impact of that customer procurement.
CEBA’s submission to SBTi’s call focuses on:
- The role of energy attribute certificates: EACs have played a pivotal role in driving corporate CFE investment and deployment by providing corporations with a transparent and uniform means of procuring CFE and reducing greenhouse gas emissions. EACs can also evolve and be improved to activate the next generation of procurement and drive greater and more targeted emissions reductions.
- Addressing supply chain and Scope 3 emissions: EACs are a valuable and potentially game-changing tool for tackling supply chain and Scope 3 greenhouse gas emissions. Scope 3 emissions can account for 65-95% of an organization’s total emissions, and EACs provide a crucial avenue for corporations to confront this significant portion of their supply chain emissions. In the absence of EACs, corporations and supply chain partners would have limited to no options for addressing Scope 3 and supply chain emissions in many global markets, and without a clear and accessible path for achievement, corporations might abandon setting supply chain decarbonization goals altogether.
SBTi is accepting the following types of evidence:
- empirical data and research studies,
- reports and white papers,
- statistical information,
- case studies and examples,
- surveys and polls, and
- legal and regulatory analysis.
To support other organizations in submitting comments to SBTi, CEBA has shared a resource list that we used to inform our submission to SBTi. These resources highlight the effectiveness of EACs in meeting corporate climate targets.
CEBA is hard at work to advocate for policies that support and advance voluntary markets and to equip our members with the information and tools needed to demonstrate impact in driving clean energy procurement. By submitting responses to SBTi, organizations can help shape the types of market instruments that count toward achieving climate targets. To learn more about CEBA’s SBTi submission, contact Kerri Metz at firstname.lastname@example.org or Priya Barua at email@example.com.