- Use of EXIOBASE Database
I have looked into the EXIOBASE database which is referred to by PCAF to calculate emissions associated with business loans to the agricultural sector. My understanding is that while the EXIOBASE includes upstream scope 3 emissions, it does not include land based GHG emissions (Land use change, Land management and Carbon removals).
So am I correct in assuming that for Financial Institutions with FLAG businesses in their portfolios, the EXIOBASE emission factors would need to be supplemented with additional GHG emissions to account for the land based emissions.
- Process for accounting for land based emissions associated with FLAG customers of Financial Institutions
Could you please clarify the process for calculating land based emissions for loans and project finance customers. In many cases, the information available for these customers is limited to the sector/ sub-sector (e.g. agriculture – dairy) and the loan value. The calculations of land emissions for these customers would have a very low level of accuracy due to the assumptions that would need to be made. Is there an alternative approach recommended? Or are land based emissions to be excluded?