For a cross-sectoral company that is trying to set SBTi targets, how should they go about the different requirements set by sector-specific guidance about targets?

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(This is not FI related)

Hi all,

If a company is involved in multiple sectors: Generation of electricity using fossil fuel, transmission and distribution of electricity/gas as well as urban development. They are intending to set SBTi targets, how should they approach the different sector-specific guidances? Are they required to adopt all of the sector-specific guidance (ie. Electric utilities, oil & gas as well as buildings - when it is finalised)? How do they reconcile the different requirements from different guidance?

Example for Scope 3 requirements: Their revenue from sale, transmissions and distribution of fossil fuel is less than 50%, and SBTi requires them to set a target for Category 11. Does that mean they can set a target for Cat 11 in line with 1.5°C as advised by the electric utility sector guidance and for the rest of the scope 3 categories it can be in line with 2°C as advised by the cross sectoral guide?

Page 12 of electric utilities guidance vaguely answers the question

“For companies generating power, the SDA must be used to model targets covering electricity generation-related emissions within the organizational boundary, as well as generation-related emissions associated with all sold electricity. Emissions not associated with electricity should be addressed by the company’s SBT (if applicable) but may be modeled using a different target-setting method.” - It does not explain how. What does “different target-setting method” mean?

Thanks in advance for any replies!

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Please note that this Community Forum is meant for financial institutions-related discussions. You can reach out to info@sciencebasedtargets.org for more information and questions on non-financial sector companies.

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What I understood is that for each stage of the value chain, a specific target must be set. For example, one target for generation, another for T&D, and the other for distribution of O&G if its revenue from it is less than 50%. You can find some examples here for calculating the emissions: https://ghgprotocol.org/sites/default/files/standards_supporting/Chapter3.pdf

Each target will depend on the structure and sector, so you’ll have to check if it has sectoral guidance, if not, absolute contraction will be the case (unless you are an O&G company which is forbidden for now).

Cheers,

J