Methods: Science Based Targets · reduction targets in line with a 2°C decarbonization scenario...

Methods: Science Based

Targets

Second Annual Summit on Science

Enablement for the SDGs: The Symposium

@sciencetargets

#sciencebasedtargets

#SDGs

I. Setting the Scene: Why Science Based Targets?

Heidi Huusko, UN Global Compact

II. Methods and Criteria: How to set a Science Based Target?

Cynthia Cummis, WRI

III. Companies Taking Action

Lori Michelin, Colgate-Palmolive Company

Sally R.K. Fisk, Pfizer Inc.

IV. Q&A: Leadership for Science Based Targets

Session Agenda

Science Based Targets I Setting the Scene: Why SBTs?

Heidi Huusko

Senior Manager, Environment & Climate

UN Global Compact

Science-based targets provide companies with a clearly

defined pathway to future-proof growth by specifying how

much and how quickly they need to reduce their

greenhouse gas emissions

Targets adopted by companies to reduce greenhouse gas

(GHG) emissions are considered “science-based” if they

are in line with the level of decarbonization required to

keep global temperature increase below 2 degrees

Celsius compared to pre-industrial temperatures, as

described in the Fifth Assessment Report of the

Intergovernmental Panel on Climate Change (IPCC AR5)



Context-based targets aim to assist businesses to

align their water use with public policy objectives and

a scientific understanding or local river conditions.

Through multi-stakeholder collaboration, this project

will recommend an approach to set corporate water

metrics and the water targets they support.

Uses best available science, informed by contextual

social needs, and align with local and global public

policy objectives such as the SDGs.


7

We are transitioning

towards a new

climate regime

Science

Policy

Climate

impacts Stakeholder

expectations

Technology Energy costs

Market

transformations Opportunities


“Science-based GHG emission reduction target

setting will become standard practice and

corporations will be contributing to closing the

emissions gap left by country commitments.”

our vision:

Since officially launching in June, 2015:

311 Companies

have formally

joined the

SBTi Call to

Action

73 Companies

have

approved

targets

Companies

joining the Call to

Action every

week

~2

Science-based targets I Setting the Scene: Why SBTs?

9


11

Top countries represented by companies committed to science-based targets

.

22

7 10 9 10

8 7 9

5 8 7 7

5 7 6

3 4

7 3

2 1 2 3

4 2

3 2

0

5

10

15

20

25

SBTi Companies by Sector

Committed Set targets


12

• Increase efficiency to be more competitive

• Unlock new financial returns

• Attract investors

• Proactive policy engagement as a leader

• Pre-empt policy changes and regulatory risk

• Future proof growth

• Join the global call to action

Science-based targets I Why companies engage?

13

Science-based targets I How can companies participate?

14

Science Based Targets I Methods and Criteria: How to set a Science

Based Target?

Cynthia Cummis

Director, Private Sector Climate Mitigation

WRI

• Greenhouse gas emissions reduction

targets aligned with the latest climate

science for keeping warming below 2°C

• A clear pathway for companies to

future-proof growth by specifying

necessary greenhouse gas emissions

reductions

• A challenge to companies to transform

their business and help create and

prepare for a low-carbon economy


Based Target?

16

What are science based targets?

2010 2020 2050 2100

<1.5ºC <2ºC

GT CO2e

Year

Understanding emission reduction targets based on climate science for keeping warming below

1.5ºC and 2ºC

360 GT CO2 1010 GT CO2

70 to 95% below 2010

levels

40 to 70% below 2010 levels


Based Target?

Science-based targets I Best-practice criteria

Boundary

All company-wide Scope 1 and

Scope 2 GHG emissions must be

covered

Timeframe

5-15 years into the future

Ambition

Consistent with decarbonization

required to stay below 2°C - while

we encourage efforts towards

1.5°C

Scope 2

Disclose whether a location or

market based approach is followed

Reporting

Disclose GHG emissions inventory

on an annual basis

The SBTi has established a set of criteria that all targets must meet to be

validated as Science-based

Science-based targets I Scope 3 Criteria

• Boundary: Companies must complete a scope 3 screening for all relevant scope 3

categories in order to determine their significance as per the GHG Protocol Corporate

Value Chain (Scope 3) Accounting and Reporting Standard.

• If a company’s scope 3 emissions are at least 40% of total scope 1, 2, and 3 emissions, a

scope 3 target is required. The scope 3 target boundary must include the majority of value

chain emissions; these are the top 3 categories or 2/3 of total scope 3 emissions.

• Ambition: Scope 3 targets should clearly demonstrate how the company is addressing the

main sources of GHG emissions within their value chain in line with current best-practice.

Scope 3 I Target preference hierarchy

1. Percentage-based absolute emissions target (in line

with 2oC pathway when possible) or intensity target

based on the SDA

2. Other, percentage-based emissions intensity target

resulting in ambitious reductions in absolute emissions

3. Performance-based target expressed in absolute or

intensity terms, such as around increasing the energy

efficiency of product portfolio

4. Targets to influence behavior of suppliers or customers

Most preferred

Least preferred

Carbon budget Allocation approach Emissions scenario

SBT methods have three main components

Components of SBT methods I Approaches

Components of SBT methods I Allocation approaches

2010 2020 2030 2040 2050

Emis

sio

ns

Inte

nsi

ty

Year

Company A

Company B

Sector

Company C

• Used with sector-specific

scenarios and physical

indicators

• Appropriate for

‘homogenous sectors’

1. Convergence of emissions intensity

2010 2020 2030 2040 2050

Ab

solu

te E

mis

sio

ns

Year

Company A

Company B

Company C

Company D

• All companies w/in

same level of

disaggregation reduce

at uniform rate

• Emissions reduction

expressed in absolute

terms (tonnes CO2e)


2. Contraction of absolute emissions

2010 2020 2030 2040 2050

Emis

sio

ns

Inte

nsi

ty

Year

Company ACompany BCompany CCompany D

• All companies w/in

same level of

disaggregation reduce

at uniform rate

• Emissions intensity can

be a physical or value

based metric


3. Contraction of emissions intensity

Science Based Targets I Target modelling

25

Based on sector-specific carbon budgets

determined by mitigation/technology

options and activity projections.

SBT approach

A) Sector-based

approach

B) Absolute-

based approach

C) Economic-

based approach

Based on absolute emissions reductions

determined in climate reports (e.g. 49-72%

reduction in IPCC 5th AR).

Based on the average emissions reductions

determined in climate reports per projected

economic output.

Science Based Targets I Getting started on target setting: Methods

SBT approach

A) Sector-based

approach

B) Absolute-

based approach

C) Economic-

based approach

Greenhouse Gas Emissions per Value Added (GEVA)

Corporate Finance Approach to Climate-Stabilizing

Targets (C-FACT)

Carbon Stabilization Intensity (CSI)

Context-based carbon metric (CSO)

Sectoral Decarbonization Approach (SDA)

3% Solution

Linear approach / absolute contraction

• Freely available open-source

methodology

• Allows companies to set emission

reduction targets in line with a 2°C

decarbonization scenario

• Based on the 2°C scenario (2DS)

developed by the International

Energy Agency (IEA) as part of its

Energy Technology Perspectives

publication

Science-based targets I Getting started on target setting: SDA

Science Based Targets I Companies Taking Action

Lori Michelin

Vice-President Sustainability & EHS

Colgate-Palmolive Company

Science Based Targets I Companies Taking Action

Sally R. K. Fisk

Assistant General Counsel Environmental Law

Group

Pfizer Inc.

Science Based Targets I Q&A

Moderator: Heidi Huusko, UN Global Compact

Panelists:

• Cynthia Cummis, WRI

• Lori Michelin, Colgate-Palmolive Company

• Sally R.K. Fisk, Pfizer Inc.

[email protected]

www.sciencebasedtargets.org

@sciencetargets

http://www.sciencebasedtargets.org/

http://www.sciencebasedtargets.org/

Methods: Science Based Targets · reduction targets in line with a 2°C decarbonization scenario...

Documents

Transcript of Methods: Science Based Targets · reduction targets in line with a 2°C decarbonization scenario...