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The Evolution of Net Zero: SBTi's Controversial Shift on Scope 3 Emissions

free-photo-of-trees-planted-in-forest-1The Science Based Targets initiative (SBTi), renowned for setting ambitious climate benchmarks, has stirred significant discourse in the corporate and environmental sectors with its recent proposal to include carbon credits for offsetting Scope 3 emissions. This move, aimed at accelerating the decarbonisation of value chains, has not only brought new opportunities but also ignited fierce internal and external backlash. Here, we explore the implications of this decision and the varied reactions it has provoked.

A Bold Move Towards Flexibility

SBTi's decision marks a pivotal shift in tackling the indirect emissions that companies often struggle to manage directly. By allowing environmental attribute certificates, such as emissions reduction credits, for Scope 3 emissions, SBTi aims to offer companies a practical tool to complement their emission reduction strategies. This approach acknowledges the complexity and challenge inherent in influencing emissions outside of direct operations, suggesting a recognition that current strategies need additional support to be effective.

The organisation plans to set specific guardrails and thresholds to ensure these credits are used responsibly and effectively. These changes are to be embedded in the revision of the Corporate Net-Zero Standard, with a first draft expected by July 2024, after consultations with a broad range of stakeholders.

The Controversy Surrounding Carbon Credits

Carbon credits have been a contentious topic in the fight against climate change. Critics argue that they allow companies to "buy their way out" of having to make real reductions in emissions, potentially leading to a scenario where no actual decrease in global emissions occurs. This system can create a market for offsets that might not always correspond to genuine or additional climate benefits. The fear is that it can enable a form of "greenwashing," where companies appear more environmentally friendly than they are, undermining the global effort to reduce carbon emissions.

Internal Dissent and Market Reactions

Despite the potential benefits, the announcement has faced significant scrutiny. Notably, within SBTi itself, the decision has reportedly been met with contention from some staff members, leading to calls for the resignation of the CEO. Critics argue that the move contradicts the scientific basis of SBTi’s previous positions and could undermine its credibility by potentially allowing companies to purchase their way out of actual emissions reductions.

The market reactions have been mixed. Organisations like the International Emissions Trading Association have welcomed the decision, viewing it as a realistic method for companies to participate more actively in climate action. Conversely, entities like Greenpeace and Carbon Market Watch have expressed concerns, suggesting that the initiative could weaken SBTi’s role as a stringent and science-based body.

Broader Implications for Corporate Sustainability

This development raises essential questions about the balance between pragmatic solutions and the integrity of climate commitments. The use of carbon credits, particularly for Scope 3 emissions, touches on the broader debate over the effectiveness of offsets versus direct emission reductions.

For companies, especially those engaged in sectors with significant indirect emissions, the ability to use carbon credits could provide a crucial mechanism to meet ambitious net zero targets. However, it also demands rigorous scrutiny to ensure that these credits do not become a substitute for genuine decarbonisation efforts.

NeuerEnergy's Perspective

At NeuerEnergy, we understand that achieving net zero is a complex challenge that requires innovation, collaboration, and persistent effort. As promoters of decisive and transparent environmental action, we believe that the SBTi's recent shift could inadvertently open floodgates to greenwashing, allowing companies to claim progress without making substantial reductions in actual emissions. As the debate unfolds, we remain committed to supporting our clients in navigating these changes, firmly opposing any measures that dilute the real intent of net zero commitments. Our approach is action-oriented, focusing on planning and implementation, rather than just carbon accounting. We emphasise the importance of substantial and measurable actions over mere compliance, advocating for strategies that genuinely reduce carbon footprints rather than simply balancing them on paper.


As SBTi ventures into this contentious territory, the outcome of this decision will significantly impact the future trajectory of corporate climate action. It highlights the ongoing evolution of strategies needed to combat climate change and the continuous need for dialogue and reassessment of our approaches. As we await further developments, it is crucial for all stakeholders to stay engaged, informed, and prepared to adapt to ensure that our collective actions lead to meaningful environmental outcomes.

For more insights on navigating the complexities of net zero commitments and staying ahead in a rapidly changing regulatory environment, connect with NeuerEnergy. Together, we can forge a path toward genuine sustainability and climate resilience.

Topics: Sustainability, Net zero, SBTi

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