Net Zero has since become a popular concept within the corporate world as an approach to accelerate the transition to a low carbon economy. It refers to achieving an overall balance between emissions produced and emissions taken out of the atmosphere. A commitment to net zero considers both a company’s own emissions and investment in offsetting projects, such as renewable energy generation or reforestation projects, separate from their own operations and direct emissions. For that reason corporate commitments to Net Zero must be critically assessed.
Some ‘net’ offset projects can deter or delay the meaningful carbon reductions initiatives needed to take place within the company, and can even be used to justify increased fossil fuel production. Carbon reduction targets can also be linked to planned or future offsets, and researchers and analysts fear that anticipated reductions could be overstated and rely on technologies that are yet to be fully developed. A tweet from Marc Campanale, Founder of Carbon Tracker, captures this completely:
At Honeytree we assess companies on their ‘net zero’ efforts, however we focus specifically on direct carbon emissions reduction efforts. To have any hope of achieving the 1.5°C objective set out by the Paris Agreement, decarbonization is the most important course of action for corporations. We look to the Science Based Targets Initiative (SBTI) which has been working over the last several years to translate climate science into a framework that allows companies to set climate targets, based on a set of robust criteria and transparent validation protocols. As of August 2020, close to 1,000 companies are setting science-based GHG emission reduction targets through the SBTI. This is a collaborative initiative with the Carbon Disclosure Project, the United Nations Global Compact (UNGC), and the World Resources Institute (WRI). The SBTI sets a high standard by not allowing offset projects to count towards corporate science based targets. Targets must be based on direct emissions reduction within a company’s own operations or value chain. Offsets are only considered to be an option for companies wanting to finance additional emission reductions beyond their science-based targets. Bottom line, net zero is a meaningful objective, but it must align with science based targets and involve third-party verification to make any real impact.
[Windmills generate power in the prairies with blue sky and clouds in the background]