The sustainability credentials for Energy Attribute Certificates (EACs) for both bundled and unbundled supplies is becoming more stringent as various reporting standards are stipulating more specific criteria to be met to showcase additionality and enhanced levels of traceability. From core compliance requirements under the GHG Protocol to advanced requirements under the CDP and RE100, companies must ensure purchased EACs align with their wider decarbonisation strategies and reporting commitments.
EACs for Reporting Renewable Consumption
The purchasing of EACs has been a long-established decarbonisation lever for companies to implement across global markets. EACs represent 1 MWh of certified renewable electricity and can be used to report 100% renewable consumption and zero emissions across a companyโs international/chosen portfolio. EACs can be purchased โbundledโ as part of a renewable electricity supply contract, or โunbundledโ if purchased independently to an electricity supply contract.
With increased pressure/requirements from leading sustainability reporting schemes, supply chains and customers to ensure all electricity consumption meets the best available standards, companies increasingly need to adopt a strategic and long-term approach to purchasing EACs.
EAC Credentials/Standards
Below you will find details of the specific criteria and standards EAC must meet to ensure compliance with the Greenhouse Gas Protocol, Science Based Targets initiative (SBTi), CDP and RE100.
As a minimum, all EACs must align with the GHG Protocol, with extended criteria applying to companies aiming to comply with voluntary schemes and best-practice standards.
GHG Protocol Scope 2
Website: https://ghgprotocol.org/
The Scope 2 Quality Criteria outlines that all contractual instruments used for market-based reporting shall:
- Convey the GHG emission rate of producing one unit of electricity.
- Be the only contractual instrument associated with electricity generation claimed.
- Be retired or cancelled either by or on behalf of the reporting organisation.
- Be redeemed as close as possible to the production period of the electricity generated which is applied to the certificate.
- Be sourced from the same market as both the electricity consumption and production.
Science Based Targets Initiative (SBTi)
Website: https://sciencebasedtargets.org/
The current Corporate Net Zero Standard does not have any specific guidance on purchasing renewable electricity certificates. This is due to change with the introduction of the new version of the Corporate Net Zero Standard (V2) (currently under consultation).
The proposed requirements are:
- Separate Scope 2 location-based reduction target alongside the Scope 2 market-based emissions or zero-carbon electricity target.
- 100% of Scope 2 emissions should be covered by the target.
- Zero-carbon electricity should be delivered to point of use either via the grid or with physical traceability. Energy via the grid should have associated contractual instruments which at minimum meet the GHG protocol Scope 2 Quality Criteria.
- In markets where it is possible, contractual instruments should match both the time and location of electricity consumption.
- If electricity consumption occurs in grids where it is not possible to procure zero-carbon electricity, companies should, as an interim measure, contribute to zero-carbon electricity in other grids. This is to be reported separately to Scope emissions.
CDP
Website: https://cdp.net/en
The CDP requires reporting on the type of contractual instruments used in the procurement of renewable electricity. In order to comply, companies must adopt the following regulations in their purchases:
- All low-carbon electricity should be reported, with a new row for each country/area, procurement type, and technology type.
- Renewable electricity must be sourced from the same market as the consumption โ these are generally geographic boundaries with the exception of the US-Canada and Europe international single markets.
- Natural gas or fossil fuel based combined heat and power is not permitted.
- Contractual instruments purchased must align with the GHG Scope 2 Quality criteria.
- The vintage of electricity generation must be no earlier than 6 months before the start and no later than 3 months after the end of the reporting period. While they are not explicitly required, the CDP also recognises geographic or time-matched certificates and additional voluntary labels, such as Green-eยฎ or EKOenergy as demonstrating advanced levels of sustainability.
RE100
Website: https://www.there100.org/
RE100 is the most stringent of all compliance schemes terms of EAC procurement with the following requirements:
- All claims must be credible, including credible generation data, attribute aggregation, exclusive ownership to renewable electricity claims, within geographic markets and vintage requirements. These must follow the criteria of the above standards.
- Where EACs are common, these are essential for a renewable electricity claim. Where they are available but not the norm, the purchase of EACs is highly recommended in case of increased regional uptake changing procurement requirements of the RE100 locally.
- Certificates must be project-specific to long-term recently commissioned renewable electricity projects. All projects must be either commissioned or repowered within the past 15 years.
- Only the following renewable resources are recognised: wind, solar, geothermal, marine, sustainably sourced biomass, and sustainable hydropower. Biomass and hydropower require assurance the electricity was generated sustainably, with 3rd party certification such as Green-eยฎ or EKOenergy recommended.
How NUS Can Support Reporting Requirements and EAC Procurement
NUS work with companies to implement EAC procurement strategies which support corporate objectives and alignment with sustainability reporting standards. This service includes full advisory support and the procurement of EACs across global markets, including but not limited to: Guarantees of Origin (GOs) across Europe, Renewable Energy Guarantees of Origin (GOs) across the UK, Renewable Electricity Certificates (RECs) across North America and International Renewable Electricity Certificates (I-RECs) across other international markets.
NUS can carry out a full RFP process to ensure companies receive bespoke and cost-effective options for all EAC procurement requirements.
If you require a more detailed conversation regarding the next strategic steps for purchasing EACs contact your local NUS consultant or email the NUS Energy and Sustainability Services (ESS) team at UKSustainability@nusconsulting.co.uk.
More information on sustainability-related compliance and reporting services.