GHG Protocol Scope 2 Survey

We do not support making hourly matching a universal requirement, but we support GHG Protocol’s effort to establish clear accounting rules for companies that choose to apply it voluntarily. Hourly matching should remain an option (“may”), not a mandate (“shall”).

Hourly matching can complement long-term forward instruments such as PPAs, VPPAs, forward REC contracts, or battery tolls that provide bankable revenue certainty to new projects and to the technologies needed to fully integrate renewable energy and decarbonize every hour of every day.

However, hourly matching by itself does not improve the accuracy or integrity of emissions accounting. Electricity accounting remains allocational, not physical, and the grid cannot verify that specific generation was delivered to specific consumption.

While the voluntary market can contribute to full renewable integration, it is unlikely (and not necessary) to be the primary driver. As excess clean generation grows and prices fall in certain hours, energy markets will naturally encourage integration technologies through price signals and load shifting.

Load profiles make hourly matching more feasible than requiring hour-level data from all participants. However, unless companies are required to disclose which load profiles they use and when, the approach risks eroding the usefulness of reporting and comparability between organizations or even within organizations (if different load profiles are used for different sites or regions) while implying greater accuracy than achieved.

Even for organizations above any proposed exemption threshold, requiring granular or hourly matching presents major feasibility and cost challenges. These challenges affect not only smaller buyers but also large corporations with global or distributed operations, for whom site-level hourly matching across multiple grids would be prohibitively complex. Exemptions do not mitigate these issues, as they only address hourly matching and not the broader structural or market limitations that prevent implementation. The result would be reduced participation in voluntary clean energy markets and diminished impact from corporate procurement overall.

Feasibility and Participation:‍

Hourly matching is particularly difficult for smaller organizations or those with distributed loads. Many would need to replace a single impactful VPPA (which can take 6-24 months and significant cost to execute) with dozens of REC agreements or aggregated contracts with other buyers [1]. Load profiles and estimation tools can make hourly matching more achievable, but they also introduce additional assumptions that reduce accuracy and comparability across companies.

Cost:
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Fragmented contracting would increase transaction costs, legal complexity, and management burden. Studies show that achieving over 90% hourly matching is necessary to reduce emissions beyond 100% annual matching.[2] Costs for achieving 90% hourly matching are twice as much as annual matching and skyrocket to achieve higher matching (over 3x for 98% and over 4x for 100% matching).[3] Companies that maintain their commitment to 100% renewable energy may need to substantially over-contract the quantity of renewable energy relative to actual annual load, further increasing costs.[2] Studies looking at clean hydrogen had similar findings where adopting an hourly matching strategy was often more costly than annual matching with eligible RECs.[4] Hourly energy matching generally results in the highest carbon abatement cost per tCO2 displaced, costing 7-14 times more than marginal emissions matching.[5]

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Hourly matching may have some value as an optional disclosure or complementary metric, but mandating it would make participation infeasible for many buyers, especially smaller or distributed ones, while delivering minimal improvements in accuracy at dramatically higher cost and reduced impact.

References:
[1] Case Study: Caught in the Middle - How Hourly Matching Reduces Impact for Distributed Loads https://img1.wsimg.com/blobby/go/15907343-a52a-4fb2-acba-527a9dd22090/Caught%20in%20the%20Middle-c029cc3.pdf

[2] Review of Research on the Impact of Voluntary Energy Procurement
https://zerogrid.org/wp-content/uploads/dlm_uploads/2025/05/iai-review-research-voluntary-energy-procurement.pdf 

[3] Evaluating the Impacts, Costs, and Consequences of Proposed Scope 2 GHG Emissions Reporting Standards
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5375940

[4] Assessment of Studies on US Hydrogen Tax Credits and Potential Takeaways for Scope 2 Guidance
https://ghgprotocol.org/sites/default/files/2024-11/S2-TheBrattleGroupReport-20241121.pdf 

[5] Cost and emissions impact of voluntary clean energy procurement strategies‍

https://tcr-us.com/uploads/3/5/9/1/35917440/2024_april_cost_and_emissions_impact.pdf

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Narrower deliverability regions than today’s market boundaries, while overlapping with accounting under the location-based method, could reduce excess supply from neighboring markets and unintentionally undermine project financing in local markets.

This shift would only be beneficial if procurement in those narrower markets materially INCREASED the long-term, bankable revenue certainty that enables new project construction. However, in practice, the opposite is likely to occur. 

A requirement to procure within narrowly defined grids could HARM global decarbonization if:
(a) Less impact if companies move procurement to cleaner grids rather than those with higher emissions and greater need for new renewable capacity;
(b) Less impact if buyers concentrate support for renewables in regions with stronger policy support rather than regions where private action matters most;
(c) Less impact if companies abandon long-term forward contracts that enable new projects in favor of short-term spot purchases that represent uncontracted and unbankable revenue; 
(d) Less impact if companies focus only on their local grid and stop taking action once it is relatively clean.

As CRS has noted, restricting procurement to smaller geographic regions “constrains access to clean electricity and risks slowing renewable deployment.”[1] Broader boundaries, by contrast, allow buyers to act where their investment can make the greatest additional impact. 

Over time, narrowing boundaries would drive more clean-energy buildout in already-clean regions and less in dirtier grids, ultimately slowing global emissions reduction.

[1] Missteps in Proposed Updates to GHG Protocol’s Scope 2 Guidance (CRS, Oct 2025)

https://resource-solutions.org/missteps-in-proposed-updates-to-ghg-protocols-scope-2-guidance/

If suppliers determine what qualifies as SSS or how to allocate it, and buyers can still claim it even when suppliers don’t allocate or retire attributes, the framework will remain inconsistent, unauditable, and open to manipulation. Clear definitions alone cannot fix a system that allows claims without verifiable ownership or retirement of certificates.

Several resources described in the proposed Standard Supply Service (SSS) examples should not be automatically allocated to all customers, as doing so would expand “clean” supply without improving impact, transparency, or consistency across markets.

1. Legacy or pre-existing clean generation not previously part of voluntary REC markets
Generation from legacy projects—particularly large hydro, nuclear, and other resources that have not historically issued or sold RECs—should not be eligible for SSS allocation. Even if these resources later establish tracking systems, their inclusion would flood the market with low-cost “clean” supply that does not represent new or incremental investment, suppressing demand for voluntary procurement and reducing the market signal that finances new projects. 

In so far as SSS is intended to act as the third pillar of incrementality, this could be done more easily by limiting SSS eligibility to projects built or repowered within the past 15 years. This would be consistent with the concept of maintaining a connection to recent investment and project enablement.

2. Untracked public resources or facilities without certificate retirement
Publicly owned or regulated assets (for example, legacy hydro or nuclear) that lack verifiable EAC retirement should not be allocated under SSS. Until transparent tracking systems are in place, their output should remain accounted for under the Location-Based Method.

In short, SSS should be narrowly applied to recent, regulated, and verifiable resources where customers have a mandatory financial relationship and certificates are transparently retired. Including older, legacy assets (even if tracked retroactively) would undermine market integrity and reduce incentives for new clean energy deployment.

The proposal makes clear that allocation of SSS is voluntary: “Suppliers should allocate SSS electricity supply and related RECs … however, the GHG Protocol cannot require suppliers to allocate SSS electricity supply and related RECs to their customers.”

Because suppliers retain discretion, utilities will have strong incentives to classify their most valuable clean resources (such as hydro or wind) under green tariffs or other resource-specific programs to preserve REC sales and premium pricing. As a result, SSS would likely consist of lower-value or residual resources, reducing both the equity and representativeness of what it allocates.

No, it is not acceptable. Without a centralized registry or certificate-based tracking system, there is no verifiable way to allocate, audit, or prevent double counting of SSS claims. RECs remain the only proven mechanism for tracking and retirement of clean energy attributes, and should be required for any SSS allocation.

Allowing default options for SSS data would reduce comparability and credibility within the Market-Based Method. Defaults may simplify reporting, but they would yield inconsistent and unverifiable results even among entities operating in the same market.

The need for defaults highlights the limitations of the SSS concept and reinforces that hourly matching should remain optional. Where verified hourly or SSS data exist, organizations should use them; where they do not, a parallel consequential or impact-based metric should be available to maintain consistency and preserve incentives for new clean energy deployment.

If SSS is not available across regions, comparability of MBM reporting will worsen. Some entities would report lower Scope 2 emissions simply because their utilities allocate SSS, not because of any difference in procurement action or climate impact.

If SSS remains part of the MBM, interim disclosures should clearly differentiate between SSS allocations and voluntary contractual instruments backed by certificates. Reporters should disclose the share of MBM claims sourced from SSS versus voluntary procurement, along with whether certificates were retired or only allocated, to preserve transparency and comparability

We appreciate the intent behind Standard Supply Service (SSS), but we do not believe it represents a net improvement to Scope 2 accounting. SSS adds complexity without delivering clarity, transparency, or additional impact.

In principle, SSS seeks to prevent companies from over-claiming public or ratepayer-funded clean supply. In practice, it overlaps almost entirely with the location-based method. It turns market-based reporting into an exercise in identifying which hours of consumption were “dirty” and procuring only for those, rather than supporting total load through long-term, bankable contracts. This shift encourages short-term, unbundled REC purchases that do little to finance new projects.

The system is also open to manipulation. Utilities can reclassify desirable resources, such as legacy hydro or wind, into green tariffs to preserve REC sales, leaving SSS portfolios dominated by lower-value or fossil resources. At the same time, companies may receive pro-rata “pseudo-RECs” without certificate tracking or retirement, further blurring the boundary between the location-based and market-based methods and increasing the risk of double counting.

We respect the intent to prevent companies from “starting at zero” under the MBM, but the proposed framework does so by eroding the MBM’s purpose. Unless SSS is radically simplified or replaced with a clear, certificate-based mechanism, it will weaken market integrity and undermine the investment signal that Scope 2 reporting is meant to convey.

Finally, if SSS is to serve as a proxy for the “third pillar” of incrementality, eligibility should be limited to projects built or repowered within the past 15 years.

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Yes, global equity should be considered. Organizations that lack access to residual mix data (often those in emerging or less liberalized markets) would be disproportionately affected by a fossil-based default. Applying a universal fossil fallback penalizes them for conditions outside their control while doing little to incentivize data improvements.

Equity considerations could be addressed by allowing credible regional grid-average emission factors as an interim substitute until residual mix data are available. However, the larger concern is that these fallback rules, combined with SSS, could disincentivize voluntary clean procurement globally by turning the MBM into a hybrid of pre-allocated clean and fossil power. That outcome would be both inequitable and counterproductive.

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A better solution would be for granular matching (hourly and narrower location) to be optional (“may”) instead of required (“shall”). If it is left as a requirement, a phased implementation is essential but, as proposed, still too narrow to mitigate market disruption. The phase-in period should prioritize testing and optional adoption before any mandatory requirements take effect. 

At a minimum, the GHG Protocol should:

1. Guarantee full grandfathering for existing contracts signed before the new standard takes effect, for the full term of the contract.

2. Extend the phase-in to at least 2035, allowing corporate buyers, developers, registries, and utilities time to adapt systems for hourly and locational matching.

3. Require pilot reporting during the transition period to evaluate the real-world feasibility of hourly matching, deliverability boundaries, and SSS before making them mandatory.

4. Allow organizations to opt in voluntarily to test hourly or SSS accounting alongside the existing MBM to build experience and data without jeopardizing existing commitments.

These steps would protect long-term forward contracting (the single most proven and impactful mechanism for enabling new renewable capacity) while allowing time to validate whether the new rules improve accuracy or impact in practice.

Independent studies show that achieving 90-100% hourly matching can cost two to four times more than annual matching.[1] Other studies show that buyers must exceed 90 percent hourly matching to surpass the impact of annual matching.[2]

The greatest improvement to feasibility would be for granular matching should be optional (“may” not “shall”). 

We should do this not just to make the standards more feasible, but also because we don’t want companies to abandon their current goals for 100% renewable energy nor do we want to reduce the impact of the market by having them fall below 90% hourly matched (as research shows is less impactful than annually matched).

Even with the proposed exemptions, legacy clause, and phase-in, the combined hourly and deliverability matching requirements remain unworkable for many organizations. For large, distributed companies, hourly matching would require multiple overlapping procurement structures and data systems, while smaller entities would lose access to impactful long-term contracts altogether. 

The requirement therefore risks reducing participation, fragmenting global markets, and undermining the voluntary procurement mechanisms that have historically financed new renewable capacity.

Deliverability restrictions compound these issues by constraining buyers to narrower geographies, further shrinking liquidity and increasing costs without clear accuracy gains. If applied too broadly, these measures could make PPAs and VPPAs (the most proven and impactful tools for additionality) financially or contractually infeasible for many buyers.

Feasibility adjustments should instead prioritize:

- Voluntary adoption of hourly and deliverability matching before any mandatory rollout;

- Robust grandfathering of all existing long-term contracts through their full terms; and

- Parallel testing and publication of pilot inventories to assess accuracy and cost before adoption.

Without these changes, the combined revisions will raise costs, reduce participation, and weaken the market-based method’s ability to drive new clean energy investment.

[1] Evaluating the Impacts, Costs, and Consequences of Proposed Scope 2 GHG Emissions Reporting Standards
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5375940 

[2] Review of Research on the Impact of Voluntary Energy Procurement

https://zerogrid.org/wp-content/uploads/dlm_uploads/2025/05/iai-review-research-voluntary-energy-procurement.pdf 

For most organizations, especially those with distributed loads, hourly matching with deliverability would dramatically increase procurement costs while reducing market impact.

Princeton ZERO Lab’s System-level impacts of voluntary carbon-free electricity procurement strategies stated that “hourly matched procurements reduce system-level emissions but at a cost premium.”[1] The premium varies by region, matching percentage, and procurement method. Other research shows that buyers must exceed roughly 90 percent hourly matching to achieve greater emissions impact than annual matching, and costs rise steeply beyond that point.[2]

Higher costs are not inherently problematic if they signal scarcity and direct investment toward new clean capacity. The concern is that these costs will often result in uncontracted and unbankable revenue for existing projects as buyers turn to short-term spot purchases instead of long-term agreements that enable project financing. This shift would weaken the voluntary market’s ability to drive new clean energy development.

Documented drivers of this cost and impact shift include:

- Making clean grids cleaner: Forced to buy locally, some buyers will compete with strong regulatory support for renewables and procure on already clean grids, while regions with dirtier grids are left further behind. It is common for committed buyers to be located in regions where the government is equally committed.

- Build smaller, buy less: Because hourly matching discourages overproduction, buyers will be encouraged to size on-site systems to avoid excess generation in any given hour rather than over the full year. And there will be more reason to avoid long-term contracts that might produce surplus RECs they must later sell.

- Contracts may bust: Hourly matching requires many smaller local contracts instead of a few large V/PPAs, reducing economies of scale and increasing transaction costs.[3][4] Even buyers still large enough to use V/PPAs will face higher costs as each deal has fixed costs. Others will find contracting infeasible, either due to lower demand per contract (developers prefer single offtakers) or regional barriers to long-term contracting.

To preserve feasibility and impact, granular matching should remain optional (“may,” not “shall”). Programs and initiatives can still build upon it voluntarily, but mandatory adoption would raise costs, reduce participation, and weaken the market-based method’s ability to deliver new clean energy.

[1] System-level impacts of voluntary carbon-free electricity procurement strategies https://www.cell.com/action/showPdf?pii=S2542-4351%2823%2900499-3#:~:text=Hourly%20matched%20procurements%20reduce,at%20a%20cost%20premium

[2] Review of Research on the Impact of Voluntary Energy Procurement https://zerogrid.org/wp-content/uploads/dlm_uploads/2025/05/iai-review-research-voluntary-energy-procurement.pdf

[3] Limitations of Hourly Matching Claims for Scope 2 Reporting https://ghginstitute.org/2025/05/30/hourly-matching-limitations-for-scope-2-reporting/ 

[4] Caught in the Middle - How Hourly Matching Reduces Impact for Distributed Loads https://img1.wsimg.com/blobby/go/15907343-a52a-4fb2-acba-527a9dd22090/Caught%20in%20the%20Middle-c029cc3.pdf  

All of the listed rationales could apply if the impact metric provided a genuine alternative path to granular matching within Scope 2. However, the proposal places this metric fully outside the inventory and subsequent guidance [1] makes clear that it cannot influence reported Scope 2 emissions. If the metric cannot reduce or offset Scope 2 totals, it will have limited practical value.

A metric that cannot affect inventories or target compliance will not shift real procurement behavior. Companies direct capital where accounting frameworks recognize the impact of their choices. A parallel, optional disclosure will function mainly as an academic supplement rather than a driver of meaningful investment.

Attributional boundaries do not prevent consequential impact from being used as an optional qualifier of supply. Allowing companies to disclose when procurement materially contributes to new capacity strengthens transparency and preserves the attributional structure of Scope 2. This would create a workable path for recognizing high-impact procurement while avoiding a full consequential accounting framework.

[1] Frequently Asked Questions: Scope 2 and Electricity Sector Consequential Accounting Public Consultations https://ghgprotocol.org/blog/frequently-asked-questions-scope-2-and-electricity-sector-consequential-accounting-public

We support the idea of developing a separate impact metric to quantify the real-world effects of long-term forward procurement. However, as drafted, the proposal places this entirely outside Scope 2 accounting, meaning companies cannot use it to demonstrate progress toward their Scope 2 goals even though it “quantifies the emissions impact of electricity-related actions.”

That separation undermines its relevance. If the impact metric cannot reduce reported Scope 2 emissions, then hourly and locational matching remain the only path for companies to improve their inventories, regardless of whether those actions have greater or lesser system-level benefit. The result would be two disconnected systems: (1) scope 2 inventories optimized for compliance with hourly and deliverability rules, and (2) impact metrics reporting avoided emissions, with no mechanism to reconcile the two.

This division fragments corporate reporting and weakens both frameworks. It also risks a governance gap where GHG Protocol and SBTi each defer responsibility for integrating impact results, leaving companies without a clear signal for what counts toward their climate goals.

The promise of hourly and locational matching has been sold partly on claims of greater impact, yet this proposal makes no attempt to test, disclose, or standardize how that impact is measured or assured. Without integration into Scope 2 or target-tracking systems, companies will face higher costs and less flexibility but little incentive to innovate or pursue the high-impact procurement that actually builds new clean capacity.

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Success depends on balancing integrity, impact, and feasibility. Revisions should improve accuracy in how electricity is used and how procurement affects real-world emissions.

For the location-based method (LBM), we support revisions that improve temporal and spatial accuracy of emissions data. This can also encourage operational actions, like shifting load to cleaner hours.

For the market-based method (MBM), revisions should improve the accuracy of impact on real emissions, not just optics of usage claims. Electricity cannot be physically traced. Hourly matching does not change that. These proposals conflate allocation accuracy with scientific validity. No single approach, hourly matching or additionality-based contracting, can serve all companies or markets. The standard should support multiple credible pathways.

The GHG Protocol could improve transparency by allowing consequential qualification within attributional accounting. Disclosing an instrument’s expected impact or financing contribution, without redefining Scope 2 as consequential, would strengthen clarity and comparability while preserving its attributional basis.

INTEGRITY:
Integrity requires consistency, verifiability, and clarity. The proposed revisions blur attributional boundaries by treating hourly deliverability as equivalent to physical delivery. Hourly matching does not make electricity traceable, and without certificate-backed verification, it risks weakening claim integrity. The only consistent and verifiable foundation for MBM accounting remains the retirement of RECs.

IMPACT:
Spot-market RECs often fail to drive new builds, but this stems from uncontracted revenue and low spot prices, not from annual matching. Long-term forward contracts (PPAs, VPPAs, or forward REC contracts) already provide bankable revenue that enables new capacity.

Hourly and deliverability rules would move buyers away from long-term contracts toward short-term spot purchases from existing assets. Buyers will pay more, but that spending will not enable project financing. Studies show steeply rising costs beyond ~90% hourly matching, while additional emissions benefits plateau.[1][2][3]

A stronger, science-based revision would recognize differing procurement impacts, enable optionality, and allow disclosure of impact metrics grounded in consequential logic. Used as a qualifier of supply rather than turning RECs into tCO₂ avoided, this would enhance transparency without redefining Scope 2.

FEASIBILITY:
Hourly and deliverable matching would raise costs and complexity, especially for organizations with distributed loads. It requires multiple smaller contracts, removes aggregation benefits, and excludes smaller buyers. Threshold exemptions don’t apply to location matching, and legacy exclusions are temporary. Optionality, through tiered disclosure or leadership programs, offers a more feasible path to higher-quality reporting without discouraging participation.

Integrity comes from verifiable certificates and consistent boundaries. Impact comes from financing new projects, not timestamp precision. Feasibility depends on optionality, not a single rigid framework. These goals align only if GHG Protocol supports multiple credible pathways instead of codifying hourly and location matching as the sole valid approach.

[1] System-level impacts of voluntary carbon-free electricity procurement strategies https://www.cell.com/action/showPdf?pii=S2542-4351%2823%2900499-3#:~:text=Hourly%20matched%20procurements%20reduce,at%20a%20cost%20premium

[2] Caught in the Middle - How Hourly Matching Reduces Impact for Distributed Loads https://img1.wsimg.com/blobby/go/15907343-a52a-4fb2-acba-527a9dd22090/Caught%20in%20the%20Middle-c029cc3.pdf  

[3] Limitations of Hourly Matching Claims for Scope 2 Reporting https://ghginstitute.org/2025/05/30/hourly-matching-limitations-for-scope-2-reporting/