How to use the GHG Protocol’s consequential electricity emissions reporting option

Everyone knows that there’s only one way to stop climate change: reduce actual system-wide GHG emissions. This is known as causing consequential emissions reductions. But as we laid out in our joint white paper with Electricity Maps, the GHG Protocol Corporate Standard currently mandates that companies report their attributional emissions, which are not the same thing.

At WattTime, our priority is to help companies reduce real-world consequential emissions. Whether companies then choose to report those reductions is up to them. But if you would like to do so, you may be interested to learn that the GHG Protocol today also has a separate, much less well-known mechanism to optionally report consequential emissions reductions. 

The GHG Protocol Scope 2 Guidance points out that attributional methods “may not always capture the actual emissions reduction accurately.” And adds that is a problem because “Ultimately, system-wide emission decreases are necessary over time to stay within safe climate levels. Achieving this requires clarity on what kinds of decisions individual consumers can make to reduce both their own reported emissions as well as contribute to emission reductions in the grid.”

That’s why section 6.9 of the GHGP Scope 2 Guidance states that companies interested in making decisions on the basis of actual consequential impact “can report the estimated grid emissions avoided by low-carbon energy generation and use” by using a different method, the GHG Protocol Project Protocol which is supplemented by the Guidelines for Grid-Connected Electricity Projects.

And it turns out, the Guidelines for Grid-Connected Electricity Projects is an extremely useful tool for identifying and reporting on the consequences of any activity (“project”) that causes emissions or emissions reductions. Why, then, do so few practitioners know about it? 

Partly because until relatively recently, the necessary data didn’t exist in most places. But that has recently changed significantly. 

Rising access to marginal emissions data

A few years ago, the UNFCCC began producing free, global marginal emissions data of the type you need at the country and annual level, available here. 

As of this month, WattTime and other mission-driven organizations have gone even further and now released free, global marginal emissions data at the hourly and balancing authority level. Those are available free at GridEmisssionsData.io (for operating margin) and https://www.gem.wiki/MBERs (for build margin). We’d like to credit REsurety, Climate TRACE, Global Energy Monitor, Transition Zero, Global Renewables Watch, Pixel Scientia Labs, Planet Labs, and Georgetown University for making this possible.

Having free, globally available, hourly marginal emissions data solves another issue with the Guidelines: they’re written as a long, complex document, particularly because they include many lists of optional choices for what to do when you don’t have good data. And now that free high-quality data exist, that extra guidance is much less relevant than it used to be. 

So, as you’ll read below, WattTime has done the work for you of going through the Guidelines with painstaking care and working out the most simple, accurate, impactful ways to comply in a world where free high-quality global data do exist. 

Key considerations in following the Guidelines

It turns out, at its core, what the document is saying is actually very simple. The key formula in the Guidelines is that the consequential emissions of any project that generates, consumes, procures, or shifts electricity is:

• Emissions reductions = electricity reductions x ( (w)(build margin) + (1-w)(operating margin) )

So, here’s what you will need to follow the Guidelines:

• Data on your project’s “electricity reductions” in a given time and place. The Guidelines define this as generation plus procurement minus consumption, so, essentially this is the exact same electricity data you already use for the Scope 2 Market-Based Method.
• Operating Margin emissions factors (now available at api.WattTime.org, EPA.gov/eGRID, UNFCCC IFI TWG, GridEmissionsData.io, and elsewhere). 
• Build Margin emissions factors (now available at Climate TRACE, UNFCCC IFI TWG, or elsewhere). 
• A weighting factor w. For reasons we’ll outline below, WattTime recommends always using the default weighting factor given, which is 0.5. 

In many ways, following the Guidelines is very similar to following the Scope 2 Market-Based Method. For any given assessment, one combines the generation, procurement, and/or consumption by region and time period; multiplies them by the relevant emissions factors; and then adds up the times and regions to get the total emissions. The biggest difference is that the emissions factors are marginal, not average.

But there are other differences as well, such as the sign convention. The Guidelines measure (net) electricity reductions, not (net) emissions footprint. Thus, in this framework positive numbers are a good thing. But negative numbers are very much allowed — they just indicate projects that on net induce more emissions than they reduce or avoid.

Another difference is that there are several options, with no systematic decision criteria on how to choose. For example, companies are able to choose how to calculate a build margin baseline; how to select a build margin weight; whether or not to update emissions factors over time; and so on. Each of these cases opens up considerable opportunities for gaming. Further, in every case, WattTime found that sufficient free global data now exist to make using the  highest-accuracy, highest-impact option quick and easy. And although this is not explicitly stated, we’ve noticed each option appears to be listed as a de facto data hierarchy, in ascending order from lowest data requirements to highest accuracy and impact. In order to maximize accuracy and impact, and to eliminate potential for gaming, WattTime strongly recommends that, for all the lists of options in the Guidelines, companies select the final option in the list.

If you are interested in reporting on your consequential emissions impact under the optional section in the GHG Protocol, you can start using this guidance and new datasets today!