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    3. Carbon Accounting Standards Retreat from Mandatory Time-Based Power Matching

    Carbon Accounting Standards Retreat from Mandatory Time-Based Power Matching

    By: rootdata|2026/08/14 11:42:25
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    The revision of international carbon accounting standards for calculating corporate renewable energy usage is recalibrating before the final proposal is confirmed. The key issue is whether only clean power produced at the same time as the electricity consumed by companies should be recognized as emission reduction achievements.

    The Greenhouse Gas Protocol (GHG Protocol) announced in a standard development update released on July 29 that it would review Scope 2 power emission accounting separately from the impact accounting and market instruments (AMI) workstream, and aims to establish an integrated corporate carbon accounting standard with the International Organization for Standardization (ISO). The target date for the final integrated corporate standard's public release is the fourth quarter of 2028.

    Scope 2 refers to indirect emissions from electricity, heating, and cooling purchased by companies. Until now, companies have typically used annual renewable energy certificates (RECs) matching to calculate emissions from electricity usage. The current debate hinges on whether to continue recognizing this method or to require a more precise alignment of power consumption times, generation times, and power grid regions.

    If the standards change, it could alter companies' net-zero plans, renewable energy procurement contracts, and accounting practices in the certificate market. However, what has been confirmed so far are the results of public consultations and subsequent review directions, and the quantitative impact on corporate portfolios or the certificate market has not yet been determined.

    The summary of the GHG Protocol's Scope 2 public consultation indicated low support for mandatory time-based matching. A total of 909 respondents answered the time-based matching question, with only 22% in favor. Neutral responses accounted for 7%, while opposition or low support was at 70%.

    Opposition was also notably regional. In East Asia, 81%, in North America, 78%, and in Southeast Asia, 71% were classified as opposing or providing low support. Given the survey structure, which had a high proportion of companies, industry associations, and consultants, this reflects the burden perception of large power purchasers and the industry.

    In contrast, there was much broader support for exception provisions. A question allowing exceptions for time-based matching received responses from 748 individuals, with 76% in favor. Neutral responses were at 9%, while opposition or low support was at 14%.

    This suggests that companies are not outright rejecting the enhancement of accounting precision but are demanding a phased implementation that reflects data acquisition and verification costs, as well as regional power market differences. There remains a challenge in uniformly applying the same rules in areas where sufficient time-based power data and regional grid information are lacking.

    Following the public consultation, the GHG Protocol proposed exploring multiple market-based reporting approaches rather than a single mandatory method. In the same document, Scope 2 and AMI were described as separate workstreams. While Scope 2 addresses precision issues in corporate emission inventories, AMI deals with how corporate climate actions and market instruments will be reported in terms of actual emission impacts.

    The Science Based Targets initiative (SBTi) introduced location-based matching and time-based accounting rules for Scope 2 in its Corporate Net-Zero Standard v2.0 released on June 11. However, time-based matching itself remains optional, with large power users required to measure and report low-carbon power performance using time-based accounting rules.

    Reactions from the corporate side have been mixed. The Clean Energy Buyers Association (CEBA) expressed concerns that mandatory time-based matching and power delivery requirements could stifle voluntary clean power procurement, calling for optional application and protection of existing contracts. A coalition of 66 organizations also argued that time-based matching should be optional rather than mandatory.

    Conversely, the Green Software Foundation supported time-based carbon accounting in its official response. The argument is that time-based data provides a more accurate representation of actual emissions in the power-intensive digital infrastructure and software industry. ENGIE also supported the gradual introduction of time-based matching, exceptions for small organizations, protection of existing contracts, and phased implementation.

    In the market infrastructure sector, solutions for tracking and trading time-based power matching are also expanding. Some large power purchasers are demanding stricter rules, leading to a trend where renewable energy procurement, certificate tracking, and emission reporting systems are moving in tandem.

    For Korean readers, this issue is closer to the costs of power procurement and data center investments than changes in environmental, social, and governance (ESG) language by foreign companies. The expansion of artificial intelligence (AI) infrastructure is already being discussed based on large-scale power demand, and this publication has previously reported on the power scale and funding issues required for AI infrastructure. As carbon accounting standards become more precise, companies will need to explain not only how much electricity they used but also when and where they procured it.

    This revision is not yet the final rule. The GHG Protocol plans to continue discussions on Scope 2 and AMI while preparing an integrated corporate carbon accounting standard with ISO. The target date for the final integrated corporate standard's public release is the fourth quarter of 2028.

    -- Price

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