Hi there,
When calculating emissions intensity, the guidance states that this should be:
SUM[attributed emissions]/SUM[attributed activity].
Would the SBTi accept a weighted intensity as an alternative? This would be:
SUM[emissions intensity X outstanding amount/total portfolio value]
An example in a power portfolio would be SUM[gCO2e/kWh of a company X outstanding amount in company/total outstanding amount in portfolio].
Many thanks,
Ana
Hi Ana, thanks for the question. We recommend as a priority to use the PCAF approaches which use the attributed emissions and attributed intensity approach that you highlighted.
However it is also possible to use other weighted intensity approaches such as based on portfolio weightings that you outlined.
The PCAF method is preferred in order to maintain consistency between financed emissions reporting and target setting, but we also recognise that for target setting FIs may want to use other metrics for portfolio steering.
Hi,
Using PCAF, we have calculated carbon intensity for each sector (tCO2e/EUR).
The SBTi Financial Sector Science-Based Targets Guidance, states that: For financial institutions, determining portfolio emissions intensity is the starting point to apply the SDA for target setting. Portfolio emissions intensity refers to financed emissions per unit of activity data (e.g., kgCO2e/m2 , kgCO2e/kWh, kgCO2e/tonne cement).
My question is therefore: Are we allowed to have emissions intensity based on financed emissions per unit EUR and not per unit of activity data?
Thanks for posting. The SDA is used for setting physical intensity targets and not economic intensity targets. Therefore, only activity data may be used at this time.