Insights

January 6, 2022

Summit for Sustainable Business VII Part 2 – Defining and Decarbonizing Scope 2 Emissions

SR Inc’s virtual Summit for Sustainable Business on December 10th dedicated a session to defining and decarbonizing global Scope 2 emissions. David Osborn, SR Inc’s COO and Senior Advisor, presented on leading Scope 2 decarbonization strategies among Member-Clients and pioneer companies. Member-Client speakers for this session included Bob Hoffman, Global Head of Site Services & Utilities Sourcing at Merck KGaA, Darmstadt, Germany and Mike Mattera, Director of Corporate Sustainability at Akamai Technologies.

Key findings from this session and from our latest Member-Briefing on this topic include:

• Establishing impactful corporate environmental goals starts with understanding Scope 2 decarbonization options in each key geography globally and developing a portfolio of Scope 2 reduction solutions to achieve global environmental goals and prioritized organizational objectives.
• Scope 2 decarbonization strategies can have meaningful implications for Scope 1 & 3 strategies and can be the key to enabling corporations to commit to Science-Based Targets and handprint / Net Positive goals.
• Leading corporations are evolving their portfolio strategies to source more than 100% renewable energy in order to achieve Net Positive goals.
• Cost-positive VPPAs solutions, which help create new renewable capacity, are replacing less impactful and more expensive options, most notably buying unbundled RECs (from existing renewable energy sources) which do not hold a claim to be causing new renewable energy capacity to be built and which have become considerably more expensive in the last 18 months.
• As such, while portfolio strategies to achieve 100% renewable energy still prioritize energy efficiency and (behind-the-meter) on-site solar as much as is feasible, but rely primarily on buying purchaser-caused RECs through offsite utility-scale VPPAs as the primary solution. Typically the first two options are limited in scale or impact and so only reduce Scope 2 emissions by about 20% in total, as both strategies directly reduce consumption from the grid.
• Leading Member-Clients are now considering stronger demonstration by the developer of positive ESG impact in VPPA projects, such as local community / labor impact, carbon displacement, and health & ecosystem benefits.

Bob Hoffman, Global Head of Site Services & Utilities Sourcing at Merck KGaA, Darmstadt, Germany (MilliporeSigma), described the company’s commitment to offtake 68MW of wind power (from a wind system currently under construction) through the SR Inc 2020 Net Zero Consortium for Buyers (NZCB) Aggregated Procurement. MilliporeSigma is actively pursuing further aggregated VPPA opportunities in the U.S. through the NZCB to be followed by evaluating renewable energy options in Europe and Asia in a major step towards reaching climate neutrality by 2040. Bob encouraged fellow Member-Clients to pursue a credible off-site renewables strategy aligned with corporate sustainability strategy. This aim can contribute to GHG reduction and renewables goals, without any capital outlay or operational responsibilities for managing renewable assets and can be projected to be significantly less expensive than less impactful alternatives, possibly even generating a positive NPV.

We heard next from Mike Mattera, Director of Corporate Sustainability at Akamai Technologies. Akamai’s Decade of Action includes goals for 100% renewables, including developing purchaser-caused net-new renewable energy globally, 100% mitigation of platform emissions, a 50% more efficient platform, engaging with top suppliers for measurable GHG reduction, and recycling 100% of eWaste.  Mattera advised guests and Member-Clients to collaborate with industry partnerships, like the Clean Energy Buyers Association, innovative solution providers, like REsurety, and proactive programs that benefit both customers and providers, like Iron Mountain’s Green Power Pass Program, to achieve bold decarbonization goals.

We look forward to continuing our work with Member-Clients to innovatively solve for 100% of global Scope 2 emissions. Our Symposia, Summit, and multi-member management best practice guidance and tools play a key role in advancing thought leadership and bringing together global executives for collaboration and innovation toward global emission reduction. Member-Clients can view our latest Member-Briefing on this topic in our cloud-based Digital Library.