Here Shane Hughes and Samantha Deacon delve into the definition changes and what this will mean for organisational net zero goals.
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Have early adopters got the definition wrong?
Not necessarily, but the understanding of net zero certainly seems to be evolving and changing. In addition to the SBTi definition of net zero consultation, the GHG Protocol is developing new guidance for calculating biogenic emissions, and the UK Government is seeking to understand the scope of greenhouse gas removals. These are just a few of the initiatives that are evolving our understanding of the term net zero. There’s a whole new dialect being formed.
There are many advising organisations, cities and countries to use the established and commonly applied approaches to achieving net zero or carbon neutrality. It would be unfair to suggest that this is wrong, but we should be alert to the changing landscape and what it means for our collective pursuit of net zero and a more sustainable future.
Can we just accelerate offsets?
A basic principle that most agree on, is how to interpret global net zero. Essentially, we reduce emissions year-on-year whilst increasing emissions removals until we hit a point, such as 2050, where the amount of emissions emitted are matched by the amount of emissions removed. See an example representation in Graph 1.
That’s fine on a global scale but many organisations and cities that have targets to reach net zero before 2050 (ahead of global agreements) tend to have decarbonisation plans that interpret net zero as simply bringing forward the date that their organisation’s total emissions are offset. See an example representation in Graph 2.
However, SBTi's working definition depicted in the consultation appears to be quite different. It doesn't just bring forward the offset date, it also brings forward the 2050 carbon reduction levels, refocusing organisational efforts heavily on avoiding emission in the first place before engaging in “neutralisation” activities. See Graph 3 for a visual representation.
You’re not net zero until you’ve achieved ‘deep decarbonisation’
The idea of bringing forward the level of carbon reductions is explained in the consultation, where SBTi gives the following examples:
1. If the global average emissions intensity of steel production must stabilize at 0.13 tCO2/ton to limit warming to 1.5°C, a company using intensity convergence would also need to reduce the emissions intensity of its steel production to 0.13 tCO2/ton to reach net-zero.
2. If gross global emissions need to be reduced by 90% to limit warming to 1.5°C, a company using absolute contraction would also need to reduce its emissions by 90% (and neutralise remaining emissions) to reach net zero.
On a webinar, Emma Watson, Senior Manager for net zero at SBTi, showed slides confirming this, saying:
“Deep decarbonisation is the point that a company reduces its emissions as much as it feasibly can leaving what is called residual emissions… it’s really important to note that under our framework companies cannot claim to have reached net zero until they have reached this point of deep decarbonisation…net zero targets address the endpoint of a company’s emissions abatement journey more than a transitional state, where companies rely on a greater volume of offsetting”.
SBTi will confirm their definition later in 2021 and their subsequent criteria for recognising targets will be issued in 2022. So, their actual final approach may differ from their current interpretations. However, if this approach was applied in its purest and simplest terms, an organisation with a 2020 baseline and targeting 2040 instead of 2050 have 33% less time so need to abate emissions 33% faster.
You might be reading this article thinking that your organisation has luckily claimed to go 'carbon neutral' rather than 'net zero' so no need to rethink the strategy. However, the SBTi also uses the term 'neutralise' as part of their net zero definition and if the SBTi language prevails, then both ‘carbon neutral’ and ‘net zero’ claims depicted in graph 2 would probably be classed as 'carbon compensated' using SBTi language. That is to say that it would be called carbon compensation if a company nets off or neutralises emissions at any point prior to the point where carbon reductions have been maximised. This is irrespective of the type or quality of offsets owing to the fact that the company hasn’t reached their end point in their carbon abatement journey.
There won’t be enough removal offsets available
It is reasonable to say that SBTi don't own the definition of net zero and the commonly used definition may remain dominant as it’s clearly got a lot of support. However, SBTi holds a lot of influence in this arena and perhaps more importantly the commonly used definition has a flaw when extrapolated to a global scale. For example, if every entity on the globe wanted to go net zero by 2035 even if they all reduced emissions using the 1.5°C trajectory and an SBT of 4.2% annual CO2 reductions there wouldn't be enough removal offsets in the world in 2035 to net off everyone's emissions. See Graph 4 below. The commonly used net zero definition doesn't work on a global scale, and let's face it climate change is a challenge that can only be met on a global scale.
Quickly driving meaningful reductions makes more sense than offsets
The definition that appears to be coming out of SBTi’s consultation offers organisations a slightly different focus and approach to net zero. There will be far reaching implications, but we recommend organisations and cities alike focus on:
- a quantifiable way of demonstrating they are prioritising carbon reductions over offsets
- understanding and more accurately estimating what residual emissions will remain at the point where carbon reduction has been maximised
- using their understanding of their residual emissions to create a vison of the destination their net zero road map is pointing towards to mitigate some wrong turns along the way
- ensuring their net zero strategies are future-proofed. As climate science evolves it tends to dictate faster not slower change and this needs to be calibrated into net zero strategies
- focus on accelerating carbon reduction and letting the substance of their action plan define their targets and ambition and not the other way round
Understanding the definition informs actions with real impact
The definition of net zero matters as it informs the thousands, if not millions, of actions that follow. In this case, the definition attempts to inform a greater focus on carbon reduction and organisations wishing to have a net zero target approved by SBTi may want to rethink their net zero end date or - even better - rethink the speed at which emissions are reduced.
Don’t forget the role of nature in emissions removal
Keeping in mind the importance of World Environment Day in June and the themes of recreate, reimagine, restore, it’s clear that to create a net zero world we are forced to recreate and reimagine. However, it’s entirely possible that we solve the carbon conundrum, invest trillions in the energy transition, but don't restore nature, habitats, and ecosystem and don't reverse the current species extinction, or even make it worse. For us to get the best out of the herculean efforts to reach net zero, we have to be smart, we have to think broader than just carbon.
Arguably, there is a greater role for nature to be part of the climate solution under the SBT Initiative, in fact, guidance for the development of Science Based Targets for Nature are in development. As organisations strive for net zero emissions targets, they should strive for solutions that avoid net nature loss and contribute to the net nature positive global target (Graph 5 below). High quality Nature-based Solutions (NbS), such as tree planting and peatland restoration, offer opportunities for organisations and governments to neutralise or compensate for their emissions whilst also providing wider environmental, economic and social benefits. Nature should therefore be a key consideration in net zero strategies, something we will explore further in a forthcoming article.
Register for our webinar: Net zero: changing definitions with serious implications