SBTi decision on use of carbon offsets to tackle Scope 3 emissions not expected until 2025

On 30 July 2024, the Science Based Targets initiative (SBTi) published four technical papers as an early step in its revision of the Corporate Net-Zero Standard (see SBTi press release):

• Scope 3 discussion paper: This discussion paper sets out the SBTi’s initial thinking on potential changes being explored around scope 3 target setting. However, the paper does not propose draft requirements or criteria. This paper is open for feedback until 12 September. 
• Evidence received on the effectiveness of Environmental Attribute Certificates: The release of all evidence submitted as part of the open call for evidence which took place in September-November 2023 on the effectiveness of Environmental Attribute Certificates - without SBTi assessment.
• Synthesis report of evidence on the effectiveness of Environmental Attribute Certificates in corporate climate targets – Part 1: Carbon credits: A report presenting the SBTi’s synthesis of the evidence submitted through the call for evidence on the effectiveness of carbon credits in corporate climate targets. This is the first of the three reports that will be published. The reports on the other EAC instruments will be published at a later stage. 
• Findings of independent systematic review on the effectiveness of carbon credits in corporate climate targets: A statement on the findings of the assessment conducted by an independent third party on peer-reviewed academic literature on the effectiveness of carbon credits when used as a substitute for direct abatement. The statement summarizes the process followed, findings and limitations of this research exercise.

The reports highlight studies that suggest that “various types of carbon credits are ineffective in delivering their intended mitigation outcomes” and pointing to “clear risks to corporate use of carbon credits for carbon offsetting”. 

However, the SBTi have made it clear that, although the evidence examined so far reveals some insights, the findings are mixed and further work is needed in the next stage of the process to draw conclusions. 

According to the SBTi’s chief technical officer: “The SBTi believes that direct decarbonisation must remain the priority for climate action and it looks forward to the extensive public consultation on the draft Corporate Net-Zero Standard.” 

A draft of the revised Corporate Net-Zero Standard will be released for public consultation towards the end of Q4 2024. This means we will have to wait until next year to find out the SBTi’s final conclusions on the use of carbon offsets.