GHG Protocol Advances Dual-Method Approach for Scope 2 Electricity Emissions

The GHG Protocol has outlined a revised approach to Scope 2 market-based greenhouse gas accounting that could introduce two methods for reporting emissions from purchased electricity. In an update published on 16 October 2026, the organization outlined plans to retain elements of the existing accounting framework while developing stricter requirements to match renewable electricity purchases with actual consumption.

The proposal follows a public consultation held between October 2025 and January 2026, along with subsequent discussions involving GHG Protocol's Technical Working Group (TWG) and Independent Standards Board (ISB). The emerging framework could allow companies to continue using existing Scope 2 accounting requirements for a transitional period before potentially moving towards more granular electricity accounting. However, mandatory requirements, implementation dates, and the final treatment of renewable energy certificates remain unresolved.

 

Why GHG Protocol Is Revising Scope 2 Accounting

 

Under GHG Protocol's existing 2015 Scope 2 Guidance, companies can use contractual instruments, including energy attribute certificates (EACs), to calculate their market-based electricity emissions. However, the current framework can allow renewable electricity purchases from projects on grids not physically connected to a company's operations. GHG Protocol has identified concerns that such arrangements may not accurately reflect the relationship between reported electricity emissions and the energy systems supplying an organization.

The original proposed revisions sought to introduce hourly matching and deliverability requirements. Hourly matching would require clean electricity attributes to correspond more closely with when electricity is consumed. At the same time, deliverability would link eligible electricity supply to grid regions capable of serving the consuming facility. Supporters argue that these requirements could strengthen accounting credibility and encourage investment in clean generation where and when it is needed.

 

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Two Market-Based Methods Under Consideration

 

Following consultation feedback, GHG Protocol is considering a framework that uses two market-based accounting methods. Method 1 would require hourly matching, deliverability, and incrementality. Incrementality concerns whether facilities built within a defined period generate renewable electricity, helping distinguish newer clean energy capacity from existing generation. Together, these requirements aim to strengthen the connection between electricity procurement, corporate consumption, and grid decarbonization.

Method 2 would retain the existing market-based approach established in the 2015 Scope 2 Guidance, including annual matching and broader geographic boundaries. Stakeholders supporting this approach argue that keeping renewable electricity procurement markets accessible can encourage wider participation and channel voluntary corporate investment into renewable energy. In July 2026, the ISB indicated majority support for developing two methods with differentiated requirements and claims, although the final structure remains subject to further technical review.

 

Possible Transition Towards Stricter Electricity Accounting

 

During discussions between July and September 2026, the TWG and ISB examined three potential approaches to implementing the dual-method framework. These included using different reporting metrics for the two methods, allowing both to report emissions in tonnes of carbon dioxide equivalent indefinitely, or establishing a phased transition from Method 2 towards Method 1.

The ISB's latest direction favors further consideration of a transitional framework. Under the approach being discussed, companies could continue using Method 2 until a future date while identifying which accounting method they apply. After that date, organizations reporting market-based Scope 2 emissions would be expected to use Method 1 where suitable data meeting the required quality criteria is available. The transition date has not been determined, and the language governing whether companies must report under each approach also remains open for discussion.

 

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Renewable Energy Purchases Could Receive Separate Reporting Treatment

 

The Scope 2 revision is also being coordinated with GHG Protocol's Actions and Market Instruments (AMI) workstream. This initiative is developing a proposed multi-statement reporting framework designed to distinguish contractual electricity procurement from the broader greenhouse gas impacts of corporate climate actions.

The AMI proposal includes a Market-based GHG Inventory Statement for contractual instruments and environmental attributes, a GHG Impact Statement for assessing emissions impacts within and beyond a company's value chain, and a Non-GHG Indicators Statement for reporting procurement and investment activities. This could provide additional reporting pathways for renewable electricity purchases that do not meet future Scope 2 market-based accounting requirements. The approach is still under development and does not immediately change existing corporate reporting obligations.

 

Final Scope 2 Requirements Expected Through 2028 Standards Process

 

GHG Protocol's Scope 2 Technical Working Group is scheduled to hold an in-person workshop in October 2026 to address outstanding questions covering deliverability, incrementality, implementation feasibility, and transition timing. The Independent Standards Board will further review and approve the resulting proposals before including them in a consolidated public consultation planned for the second quarter of 2027.

The consultation is expected to cover proposed revisions to Scope 1, Scope 2, Scope 3 and actions and market instruments as part of the joint GHG Protocol-ISO Corporate Standard, currently scheduled for publication in the fourth quarter of 2028. Until the revised standard is adopted, the 2015 Scope 2 Guidance remains the existing framework for market-based electricity emissions accounting.

The proposed changes could significantly affect companies purchasing renewable electricity, as well as energy suppliers, certificate markets, and sustainability reporting providers. More granular accounting could increase demand for hourly electricity consumption data, time-matched certificates and improved electricity procurement systems. However, the final requirements will depend on how GHG Protocol balances accounting integrity, emissions impact, and practical implementation challenges during the remaining standards-development process.

 

Source: GHG Protocol