Science Based Targets releases first global standard for setting corporate net-zero targets

By releasing their paper ‘Foundations for Science-Based Net-Zero Target Setting in the Corporate Sector’ the Science Based Targets initiative (SBTi) has now launched a process to develop the first science-based global standard for corporate net-zero target setting. The paper lays out conceptional foundations for this process and also reflects on the role of carbon offsetting in meeting these targets.

Science Based Targets Initiative (SBTI) is a collaboration between CDP, the UN Global Compact, World Resources Institute and the WWF. With their new publication, which was developed by CDP on behalf of the Initiative, SBTi builds on findings of the Intergovernmental Panel on Climate Change: The IPCC reported in 2018 that, in order to limit global warming to 1.5°C, the world needs to halve CO2 emissions by 2030 and reach net-zero carbon emissions by 2050.

Since then, the need to reach global net-zero emissions has gained increasing awareness and many companies are raising the level of ambition in their goals to go beyond carbon neutrality. According to SBTi, more than half of the global economy is now covered by net-zero commitments. Yet, the initiative realized a lack of guidance, which has meant that corporate approaches to net-zero targets are inconsistent in level of ambition and are thus difficult to quantify in terms of their contribution to the global net-zero goal.

Net Zero is about removing as much carbon dioxide from the atmosphere as is produced so becoming net-zero can combine decarbonization, carbon removals and carbon offsetting to create an overall balance of zero. The paper aims to help increase consistency among target setters by providing some clarity around the term ‘net-zero’ and associated key concepts.

Net Zero and the role of offsetting

The paper makes it clear that compensation and neutralisation measures cannot replace the need to reduce emissions in line with science, and recognizes that offsetting and carbon removals (processes or activities that physically remove carbon from the atmosphere) are tools that can help to speed up and complement the transition to net-zero.

Companies may thus choose to offset or compensate their emissions as they transition towards a state of net-zero emissions. This can help direct much needed finance from companies to activities that can avoid emissions or bring down the concentration of carbon in the atmosphere. Compensating emissions via carbon finance in this way contributes to the global transition to net zero and, with the use of high-impact projects, can also deliver other positive environmental and social benefits linked to the Sustainable Development Goals.

In parallel, compensation can be particularly important in the transition period for those industries in which it is difficult to achieve substantial emission reductions within the short-term due to a lack of efficient technology available or other significant economic barriers.

First Climate’s standpoint

“This new paper is an important clarification of key concepts related to net-zero and a welcomed step in harmonising the transition process. We are also pleased to see that the Science Based Targets Initiative recognises the role that carbon offsets and removals can play in process. Compensation can help bring about emissions reductions in a process in which there is no time to lose. Recognising and seeking the environmental and social co-benefits that carbon offsetting projects can deliver is an important contribution for corporates to support for en route to global net-zero.”,

says Ana Aires Carpinteiro, Carbon Expert at First Climate.

Alongside defining key concepts, the paper analyses various strategies for setting net-zero targets before then putting forward its own recommendations for science-based net-zero goals. These recommendations focus on abating emissions in line with science and creating a climate-positive approach which goes beyond net-zero.

Another stipulation made in the paper is the need to properly understand the timeframes for targets. Whilst most GHG emission reduction targets set a comparative goal between a baseline year and target year, net-zero targets should focus on a singular date: namely when the company should reach a net-zero state.

The guide also discusses the role of nature-based climate solutions, which has recently gained increasing recognition as a tool for reaching net-zero emission targets. The paper comments that “it is an undeniable priority that ambitious action must be taken to eliminate deforestation and to halt nature loss,” whilst also highlighting the role nature plays in atmospheric carbon removals. It also highlights that, if mitigation measures are in place to bring emissions from land-use change (i.e. halting deforestation) to zero by 2030 as recommended, then the land system can become a global net carbon sink and key to limiting global warming to 1.5°C with minimal or no overshoot to 2050. The implicit hierarchy, made clear in the paper, is that protection of existing ecosystems and biodiversity should come first, followed by nature-based removals projects after – bearing in mind with the latter the risk of creating additional land-use pressure.

The next steps

Following this publication, the Science Based Targets initiative has set plans to develop detailed criteria for creating corporate net-zero targets, a validation protocol for these targets and further detailed guidance as to how corporates can set science-based net-zero targets and make credible claims.

Read the full paper here:
https://sciencebasedtargets.org/wp-content/uploads/2020/09/foundations-for-net-zero-full-paper.pdf