September 2022
Reporting for Scope 2 emissions has evolved with the introduction of market-based tools in Australia and New Zealand. In this joint webinar with thinkstep-anz and Toitū Envirocare, learn about the options and requirements of energy reporting in Scope 2 under the Greenhouse Gas Accounting Standards.
Scope 2 emissions are classed as the indirect emissions from purchased electricity, steam, and heating or cooling. Market-based Scope 2 reporting looks at how to communicate your renewable energy purchases.
Hear what that means for Scope 2 reduction, offsetting and Toitū Envirocare carbon programme certifications.
The webinar is presented by Dr Belinda Mathers, General Manager, Technical at Toitū Envirocare, and Christin Schaller, Senior Sustainability Specialist at thinkstep-anz.
Watch a preview of the webinar
Main webinar takeaways
Two carbon accounting methods: location- and market-based
Electricity emissions have traditionally been calculated as ‘location-based’, which reflects average grid emissions of the purchaser’s location. Calculating emissions this way is referred to as the ‘location-based’ method.
Market-based instruments (MBI) let consumers buy their electricity from a specific source, for example renewable energy – through the use of contracts, such as certificates. This means that the market-based method reflects the consumers’ choices.
It is considered best practice to report your Scope 2 emissions using both methods (Dual reporting).
Market- and location-based reporting can differ dramatically
The webinar gives calculations which show how different the results can be between the two methods. Differences mainly depend on the amount of purchased electricity covered by market-based instruments and the residual grid mix (the emission sources that power the electricity grid after certificates are removed). While market-based instruments reduce reported Scope 2 emissions, organisations should also focus on increasing efficiencies to reduce their electricity consumption.
Market-based reporting is not the same as offsetting
A market-based approach may report lower Scope 2 emissions for a company, but it’s not the same as offsetting. Offsetting represents emissions reductions through additional, external projects. Offsetting through purchase of carbon credits neutralises emissions, while market-based instruments can reduce your reported market-based Scope 2 emissions from purchased electricity.
Toitū’s certification criteria drive emissions reduction
Toitū’s criteria for their certifications are based on the GHG Protocol and the ISO standard (ISO14064-1:2018) but go beyond. Toitū allows clients to offset Scope 2 emissions based on either the location-based or market-based method. The use of market-based instruments must be publicly disclosed. Market-based instruments must meet the ‘Scope 2 Quality Criteria’ as defined by the GHG Protocol as well as Toitū’s acceptance criteria. These criteria ensure that market-based instruments that used Toitū’s certifications result in real emissions reductions in New Zealand’s emissions landscape and help New Zealand achieve their emissions reduction targets.