Impact of the Covid 19 pandemic on baseline emissions

FAQ
1

Hi there,

The guidance states the baseline data must be within 2 years of the submission date. If an FI is looking to submit their target in 2022, their options for their baseline operational emissions (scope 1 & 2) are 2020 or 2021. Due to the pandemic, scope 1 and 2 emissions from these years are not likely to be representative, and emissions may be considerably lower. Is it possible for FIs to use 2019 baseline instead, or inflate 2020 or 2021 emissions based on what they would have been if not for the impact of the pandemic. Otherwise, the operational targets will require a much lower level of emissions to be achieved, which will be a lot more challenging for companies to achieve, if their emissions already dropped significantly during the pandemic and will increase again in 2022 in comparison.

Finally, does the same baseline year for financed emissions need to be used as the year for the operational emissions?

Thanks

2

Hi Vickey,

Thanks for your question. SBTi has provided a FAQ regarding Covid-19’s impact on inventory baseline:

You may use a different baseline year for scope 3 category 15 financed emissions.

3

Thank you, that’s very helpful!

4

Hi, I am wondering whether baseline 2019 can be applied to portfolio coverage method as well? NZAM initiative proposed to set 2019 as a baseline.

5

Hi there,

Is there any update on the query above? I am also currently investigating setting one portfolio on 2019 baseline due to data, whilst other asset classes baselines are 2020. Is this allowed?

Thanks,
Ligia

6

Hello everyone, and thank you for your important questions.

etambaka:
The SBTi will still allow setting 2019 as base year for 2023 submissions, however FIs must report most recent year data and emissions as of 2020, 2021 or 2022.

For your reference, the Financial Sector Guidance states that:
FI-R3 – Base Year: The SBTi recommends choosing the most recent year for which data are available as the target base year.
FI-R5 – Consistency: It is recommended that financial institutions use the same base and target years for all targets within the midterm time frame and all targets within the long-term time frame.

Accordingly, all targets from a FI scope 3 including all targets for category 15: investments shall/must be as of the same base year.

Ligia: as per the FI guidance and the above mentioned criteria, the SBTi does not allow setting targets for the same scope with different base years. Thus, all the targets for scope 3, and all the targets for category 15: investments must be as of the same base year. The FI would have to select either 2019 or 2020 all across.

Best regards,

Monica