The Science Based Targets initiative (SBTi) has released a 132-page draft revision of the Corporate Net-Zero Standard (Version 2.0). Key proposed changes include:
Scope 3 Emissions and Transition Plan
- Version 2.0 requires companies to develop and make publicly available a climate transition plan within 12 months following validation of their targets by SBTi and which should provide a roadmap of the actions that will be undertaken to achieve net-zero by no later than 2050.
- It also requires large companies (revenue >$450M) to set Scope 3 targets.
- This draft introduces a new requirement for companies to require tier 1 suppliers (those with a direct business relationship) to set their own net-zero targets.
- The SBTi is pushing for increased use of primary data and continuous improvements in emissions tracking from suppliers. Full traceability of the most emissions-intensive activities is expected by 2035.
Carbon Offsets
- Carbon offsets remain limited to neutralizing residual emissions at the net-zero target year and cannot be used as a primary method for target achievement.
- The draft introduces a consultation on durability requirements for removals, including the possibility of transitioning from temporary to permanent removals over time.
- A new focus on Beyond Value Chain Mitigation (BVCM) provides incentives for voluntary climate finance but does not allow offsets to replace required emissions reductions.
Other Notable Changes
- Large companies will need to validate net-zero targets within one year of commitment (currently two years). Smaller companies retain the two-year timeframe.
- Companies must reassess base year emissions annually, even in the absence of major organizational changes.
Transition Timeline
- Companies can continue to set science-based targets for 2030 under the current Net-Zero Standard (Version 1.2) and Near-Term Criteria methodologies until the end of 2026.
- From 2027 onward, companies will be required to set targets under the finalized Corporate Net-Zero Standard 2.0, which is scheduled for release by the end of 2026.
The SBTi encourages stakeholders to review the proposed changes and provide feedback before the June 1, 2025 deadline.
The SBTi has always been at the frontier of climate action. The draft standard addresses complex, emerging issues and lays the foundation to enable more companies to move further and faster towards net-zero. Francesco Starace, Chair, SBTi
sciencebasedtargets.org/...
