Scope 2 in motion: what is changing in the GHG Protocol standard?

Scope 2 in motion: what is changing in the GHG Protocol standard and what does it mean for you?

The GHG Protocol organisation is working on a revision of the Scope 2 standard. This is relevant for virtually every organisation that reports its greenhouse gas footprint, as electricity often accounts for a large share of total emissions. The proposals are not yet final. However, they clearly indicate the direction of travel: stricter definitions, better data quality and less room for claims that do not align with the physical reality of the electricity system.

In this blog, we outline the key proposed changes. You will also read what you can do now to avoid being caught off guard later.

Location-based: tighter choices for emission factors

For location-based reporting, the proposals focus mainly on one question: which emission factor is “the best” for your consumption?

1) New hierarchy for emission factors

The proposed hierarchy makes explicit how to choose when there are multiple options. In simple terms:

• First, you look at location: as local as possible (grid or region) takes priority over national.
• Only then do you look at time: more detail (e.g. hourly) is better, but not if you have to accept a much coarser location for it.

Practical example: a regional annual factor may be more appropriate under this proposal than a national hourly factor, because the regional factor better matches the physical location where you consume electricity.

2) Preference for consumption-based factors

Many datasets are production-based (what is generated in an area). The revision gives preference to consumption-based factors (what, including imports and exports, is actually delivered to consumers). This better reflects what you as an end user receive.

3) Only sources that are truly usable

The standard pushes towards emission factors that are public, free and demonstrably reliable. This reduces the risk that organisations use a “favourable” factor that nobody can verify.

4) Load profiles as a bridge between annual consumption and detailed factors

Many organisations have consumption data per month or per year, while emission factors increasingly offer more detail. Therefore, room is being made for load profiles: profiles that help you logically distribute annual or monthly consumption over time, so you can still calculate with more detailed factors without immediately measuring everything on an hourly basis.

Market-based: stricter requirements for instruments and matching

For market-based reporting, the tone becomes stricter. The core question becomes: when may you still use a contractual instrument to reduce emissions in your market-based result?

1) Hourly matching

Under the proposals, you must match instruments (such as certificates or contracts) to your consumption on an hourly basis. This eliminates the room to report as “green” on an annual basis while primarily using certificates that only represent generation during certain hours.

2) Deliverability becomes more important

The revision introduces a hard requirement often summarised as “deliverability”. In plain language: the renewable electricity you claim must be realistically deliverable to the grid on which your location consumes power. Certificates from a distant, unconnected grid fit less well with this.

3) Standard supply and supplier mix

Many organisations purchase electricity through an energy supplier with a standard product or regulated mix. The proposals work towards clearer rules about what you may then claim, and how to prevent double counting.

4) Residual mix: one concept, tighter application

In the text you sometimes see “residual mix” in different forms. In practice, this refers to the same concept: the emission factor for the electricity mix that remains after specific claims (such as certificates) have been removed from the mix.

The proposals also make the fallback stricter. If no reliable residual mix is available, the GHG Protocol wants to prevent organisations from falling back on an average grid figure that turns out too favourable. Therefore, the direction seems to be: better a conservative factor than an overly optimistic estimate.

5) Impact instruments move to a different place

Contracts such as VPPAs or instruments that primarily stimulate “additional renewables” can remain strategically valuable. However, the revision pushes these narratives more towards impact reporting, rather than towards a lower market-based Scope 2 result.

Transition: making it workable without lowering the bar

The proposals acknowledge that this is a significant step for many organisations. Therefore, you see building blocks such as:

• possible exceptions for smaller consumers
• transition rules for existing long-term contracts
• phased implementation with a multi-year timeline

This helps, but the direction remains: higher requirements for data, instrument quality and substantiation.

Why this debate is sensitive

Stricter rules improve comparability and reduce greenwashing risks. At the same time, the effect may be that:

• Market-based emissions at some companies increase, purely due to stricter criteria.
• Contract strategies need to change.
• The data burden increases, especially if you still have little detail in consumption data.

So it is not just about calculations. It also affects procurement, contracting, data governance and assurance.

What stays the same

A number of principles remain in place:

• Dual reporting remains. You continue to report both location-based and market-based.
• Scope 2 remains an allocation method. You allocate emissions to your consumption of purchased electricity.
• Impact claims remain separate. A claim about “impact” or “contribution to additional renewable generation” does not automatically belong in the Scope 2 inventory. The revision seems to want to separate inventory and impact even more strongly.

What you can do now

1. Conduct an impact analysis of your current Scope 2 approach.
   Which factors, residual mixes and instruments do you currently use, and which of them become vulnerable under stricter rules?
2. Increase the granularity of your data.
   By “granularity” we mean: how fine-grained your consumption data is (annual, monthly, daily, hourly). Monthly data is already a step forward if you currently only have annual totals.
3. Review your procurement and certificate strategy.
   Look at origin, grid connection, contract duration and the extent to which you can match on an hourly basis going forward.
4. Ensure an audit trail and documentation.
   Record sources, assumptions and choices. This will help later with assurance and internal controls.
5. Actively follow the consultation.
   The proposals are still evolving. Those who contribute now can steer earlier towards feasibility and sector reality.

How Kroll SR can help

Kroll SR helps organisations make the implications of the Scope 2 revision concrete. We translate the proposals to your situation, calculate scenarios and help improve data, substantiation and contract strategy. This way, you build Scope 2 reporting that is not only compliant, but also defensible under assurance.