Companies can track the impact of their renewable energy purchases with the help of Dual Reporting. Dual Reporting allows companies to compare their individual purchasing decisions from a specific supplier, tariff, or renewable energy certificate to the overall GHG intensity of the grids on which they operate.
What is Dual Reporting?
Dual Reporting is a mechanism specific to scope 2 GHG emission accounting related to the purchase of electricity. The mechanism was introduced into the GHG Protocol and became effective in 2015. Companies reporting GHG footprints aligned with the GHG Protocol must report both location-based and market-based emissions for their electricity purchases, known as a ‘dual report’.
- Location-based: The average energy generation emission factors for defined locations, including local, subnational, or national boundaries.
- Market-based: The GHG emissions emitted by the generators from which the reporter contractually purchases electricity bundled with instruments or unbundled instruments on their own.
Why do we need Dual Reporting?
Dual Reporting allows for more consistency and comparability in reporting. This mechanism allows companies to show the quantity of energy consumption from renewable sources.
Location-based emissions footprints are largely outside the control of corporates as they are unable to significantly influence the grid mix.
As a result, some companies were historically seen to be making claims of emission reduction trends when this was largely associated with the passive use of national grids that were decarbonising outside of any action taken by the companies.
Having both location-based and market-based reports encourages both active sourcing of renewable energy (increasing demand and therefore generation) and reducing overall electricity consumption.
Emitwise’s Dual Report
Emitwise provides customers with a Dual Report which covers both the market and location-based emissions factors. This allows for a deeper understanding of your emissions and to identify more clearly where reductions can be made.
Emitwise’s requirement for Dual Reporting is to provide information on the proportion of ‘zero emission’ renewable electricity. Then, all remaining purchased electricity is assigned a residual emission factor where available or a location-based grid emission factor.
Beyond tracking, how can you incorporate renewable energy into your company's energy consumption?
Renewable Energy Credits (RECs)
RECs are commonly used by companies to certify that a certain amount of the electricity was from a renewable source. Renewable energy credits are produced when a renewable energy source (wind, solar, hydroelectric, etc.) generates one MWh of electricity and sends it to the grid. For example, if an offshore wind farm produces 12 MWh of electricity, they have 12 renewable energy credits that it can either sell or keep.
Purchasing RECs negates the need for capital investment, where firms would otherwise need to produce renewable energy on-site. It also allows firms to offset to lower their market-based scope 2 emissions from purchased electricity and claim the use of renewable energy.
Power Purchasing Agreements (PPAs) & Renewable Energy Guarantees of Origin (REGOs)
There are alternative methods to encompass renewable energy into your business. These are:
- PPAs: Power Purchasing Agreements are a contract between a renewable energy buyer and seller. PPAs can help the deployment of renewable energy projects. As developers are guaranteed to sell their electricity for long periods of time to the buyer, this reduces the uncertainty of return on their investment.
- REGOs: Renewable Energy Guarantees of Origin provide transparency to consumers about the proportion of electricity that suppliers source from renewable generation. All EU member states are required to have such a scheme. REGOs can be awarded to any source of renewable energy generation, with no minimum generation.
Renewable Energy Tariffs
Switching to renewable energy tariffs is a low-effort way for companies to reduce their market-based scope 2 emissions from purchased electricity. Renewable energy tariffs ensure that suppliers match a company’s energy consumption with renewable energy that they provide to the electricity grid.
Some energy tariffs are 100% renewable, whilst others will contain a percentage share of electricity from renewable sources. An energy supplier will be able to share the composition of their tariffs. There is a big push for increased transparency, making it easier for consumers to understand and compare tariffs.