Better accounting for emissions related to the purchase of green electricity
Introduction
A company’s direct emissions (scopes 1 and 2 as defined by the GHG Protocol) mainly consist of emissions associated with energy consumption (fixed combustion sources, mobile sources with combustion engines, electricity, steam, heating and cooling)[1] .
Three main levers can be activated to reduce them:
- reducing energy consumption (e.g. through energy efficiency and conservation)
- replacing a carbon-intensive energy with a less intensive one (e.g. through electrification)
- reducing the carbon intensity of a given type of energy (e.g. by purchasing low-carbon electricity)
Activating all these levers is key to developing a comprehensive emissions reduction strategy. To prioritise them, it is necessary to quantify their potential emissions reductions.
Contribution of different levers to the evolution of emissions linked to energy consumption (illustrative)
When it comes to reducing emissions linked to electricity supply, various low-carbon energy contracts are available: self-consumption, Power Purchase Agreements (PPAs), "green" contracts, etc. However, the current GHG Protocol accounting framework values them all in the same way, regardless of their quality. This prevents companies from differentiating between the actual decarbonisation potential of these different contracts.
This document describes the methodological framework suggested by Carbone 4 to assess the decarbonisation potential of each form of green electricity procurement, taking into account criteria of :
- spatial consistency, to promote electricity production close to the point of consumption
- temporal consistency, to promote balance between production and consumption
- additionality, to promote the development of new low-carbon electricity production methods
The aim is to ensure consistency and prioritization of all levers at the appropriate level.
This work builds on Carbone 4's previous work on the carbon compatibility of green electricity procurement. First proposals were made as part of the Net Zero initiative[2] . This document supersedes the recommendations concerning pillar A of the market-based approach, published in November 2024.
