Newly proposed rules which determine the amount of carbon dioxide removal (CDR) that companies can use to hit climate targets are still too restrictive, according to some carbon credit providers.
This week, the Science Based Target Initiative (SBTi) tabled revisions to its flagship climate target-setting framework. The keenly awaited changes did not include a loosening of the rules around carbon offsets, as had been expected after SBTi controversially indicated last year that it would allow companies to use them to neutralise some Scope 3 emissions.
The new rules instead largely hold the line on offsets – only allowing them to be used for Scope 1 and Scope 3 residual emissions which remain in the net-zero year after other abatement measures have been explored – but introduce voluntary near- and long-term targets for removals. Residual emissions are capped at 10 percent of total emissions.
The guidance also introduces an allowance for carbon removals to be applied to “ongoing emissions”, defined as emissions released while companies are implementing net-zero initiatives.
Finally, SBTi has suggested that it could implement “a gradual shift from less to more durable removals over time”, which would see increasing emphasis on “novel technologies” such as direct air carbon capture and storage (DACCS).
South Pole, a prominent developer of carbon-offsetting schemes, told Responsible Investor that there is “room for much greater ambition in this area”.
“While there has been progress, more is needed. Expanding target-setting beyond Scope 1 emissions is a key first step,” said Megan Kemp, global head of strategy at South Pole.
“All action that spurs demand in the voluntary carbon market today is positive, but it is simply not enough to meet urgent climate targets. Ultimately, governments must also play a pivotal role.”
Separately, South Pole’s global senior director for technological carbon removals, Michael Weber, described the new guidance as a step in the right direction, but “not yet a breakthrough moment”.
Companies need to address their ongoing and residual emissions and start investing in the critical future removal infrastructure from now, he said.
“Let’s also not forget that both nature-based and technological removals are critical for achieving long-term climate goals and resilience.”
Analysis from Imperial College suggests that technological removals will need to scale globally by a factor of 30 by 2030 and by 1,300 times by 2050.
Ted Christie-Miller, co-founder of offsets provider Residual, said: “SBTi’s new standard sends a clear message that companies will need to buy carbon removals, but there’s still work to do. With Scope 1 as the only immediate requirement and Scope 3 not kicking in until the net-zero year, the near-term demand signal for CDR remains weak.
“To scale a robust carbon removals industry, we need greater clarity on durability expectations and a framework that drives earlier action.”
Meanwhile Margaret Kim, CEO of Gold Standard, said the carbon credits certification provider welcomed SBTi’s focus on “companies taking responsibility for all their emissions – Scopes 1, 2 and 3 – using carbon credits and other investments”.
