The Intergovernmental Panel on Climate Change (IPCC), the world’s leading authority on climate science confirms that keeping global warming to 1.5°c, the goal of the Paris Agreement, means reaching net zero carbon dioxide emissions globally by around 2050.

The Intergovernmental Panel on Climate Change (IPCC), the world’s leading authority on climate science confirms that keeping global warming to 1.5°c, the goal of the Paris Agreement means reaching net zero carbon dioxide emissions globally by around 2050.

The IPCC’s latest assessment shows that the world can emit around 460bn tonnes of CO2 – or just 11.5 years of current (2020) emissions – after 1 January 2021 before being committed to 1.5°C.

The findings of the latest IPCC report (summarised in Figure 1) have stark implications for business who will now be under even greater pressure to decarbonise and improve long term resiliency against a changing climate.

During the past two years there has been a surge in net zero goals announced by countries, companies, investors, cities and regions to the point where around two thirds of global GDP is now covered by a net zero pledge based on a survey of over 4,000 significant entities. However there is still concern that these pledges lack substance and rely too heavily on carbon offsetting.

So what are the criticisms and how can companies align their net zero approach with what the science is telling us?

Companies taking the lead

Over 2,100 of the world's largest corporates have set net zero goals as part of the UN-backed Race to Zero campaign. Some go even further with goals to be carbon positive for example BrewDog’s double carbon programme while H&M Group aims to reduce more greenhouse gases than its entire value chain emits by 2040, from cotton farms to customers’ washing machines.

One of the most laudable net zero goals we have seen to date is that by 2030 Microsoft will be carbon negative, and by 2050 Microsoft will remove from the environment all the carbon the company has emitted either directly or by electrical consumption since it was founded in 1975. It has had its targets verified by the Science Based Targets Initiative as being in line with a pathway to limiting temperature rise to 1.5°c.

Experts criticise lack of substance

While many welcome these commitments, concerns are being raised about the dangers of the concept of net zero including voices from the very scientific community that has long called for bold action to tackle climate change.

Much of this criticism stems from the issue that these goals are not yet substantiated with clear evidence of carbon savings and concern that a long-term goal means waiting to take action too late. Many companies are looking at carbon offsets or investing in currently unproven technology with offsetting plans ranging from shipments of “carbon neutral” crude oil, or Canadian cows who will eat chemicals to reduce methane belches to offset emissions from tar sands in Alberta.

Currently however there are a number of barriers to implementing carbon removal at scale including high financial barriers, large energy consumption when it comes to certain technological carbon removal solutions and the land required for biological removal such as tree planting which competes with land needed to produce food, fibre, housing and infrastructure.  

These inadequate strategies have been partly enabled by the continuing failure to establish clear standards that properly define what delivering net zero emissions entails although standards are emerging, including an SBTi standard for net zero emissions while a number of industry groups are also supporting their sectors to navigate a path to net zero.

Yet for all the criticism that is currently being wielded, the pursuit of net zero emissions provides the best hope of delivering serious mitigation.

Providing clarity: busting the carbon jargon

One of the key areas of confusion particularly given the lack of standards is the difference between net zero carbon and carbon neutrality.

Before we cover the key differences between carbon neutral and net zero carbon, there are several linked definitions that are important to understand first.

Low emissions: Generating greenhouse gases at a lower rate than business as usual. Examples include switching from coal-fired to gas-fired power to generate the same amount of electricity, but with fewer emissions.

Decarbonization:  The process by which countries, individuals or other entities aim to achieve zero fossil carbon existence. Typically refers to a reduction of the carbon emissions associated with electricity, industry and transport.

Zero carbon (emissions): a process where no CO₂ is released at all.

Carbon negative: This means removing CO₂ from the atmosphere by deliberate human activities, i.e. in addition to the removal that would occur via natural carbon cycle processes.

Carbon offsetting: Whereby a company or an individual invests in external projects that reduce carbon emissions in the atmosphere and balance out (i.e. offset) their own carbon footprint.

 There are two types of offsetting:

1. Carbon avoidance: schemes that stop emissions before they are generated, sometimes referred to as carbon elimination or compensation. These include investment in renewable energy and energy efficiency projects in the community.

2. Carbon removal: schemes that remove emissions already generated, known as carbon sequestration or carbon neutralisation. These include:

   • Natural carbon sinks: these are predominantly afforestation and reforestation projects, but also include ecosystem restoration via peatlands and mangroves.

   • Technology: carbon capture and storage (CCS), direct air (DACCS), and bioenergy (BECCS). CCS options are currently very expensive and are not currently widely available.

Science based targets: Certain emissions reduction targets are “science-based” because if their adoption were to become standard practice, the global emissions budget would be preserved and global climate goals would be met. While the SBTi is the leading body for setting science-based targets, organisations can apply a science-based methodology to target setting without having those targets approved.

The differences between carbon neutral and net zero carbon targets

Net zero carbon dioxide (CO2) emissions are achieved when anthropogenic CO2 emissions are balanced globally by anthropogenic CO2 removals over a specified period. Net zero CO2 emissions can also be referred to as carbon neutrality.

While carbon neutral and net zero carbon definitions are broadly the same, it is the approach to target setting and how these targets are achieved that are distinct. The table below sets out the key differences based on current and emerging standards.

Net zero or net zero carbon?

It can often seem that net zero and net zero carbon can be used interchangeably or that net zero is a short hand for net zero carbon. However they should be treated as separate and distinct terms with net zero emissions referring to the full set of greenhouse gas emissions compared to net zero carbon emissions which refers solely to carbon dioxide (CO2).

In 2018, the Intergovernmental Panel on Climate Change (IPCC) confirmed that in order to limit global warming to 1.5°C, the world needs to halve CO2 emissions by around 2030 and reach net-zero CO2 emissions by mid-century. In addition, the IPCC stresses the need for deep reductions in non-CO2 emissions across the economy to achieve this limit.

Net zero targets should therefore strive to include all greenhouse gas emissions and companies must be clear in making the distinction if their targets only cover carbon dioxide.

Five steps to setting a net zero target

Taken from the emerging science based global standard for corporate net zero target, here are five crucial steps to setting a net zero target:

1.     Setting boundaries and being transparent: Targets should cover the full scope of material issues in your value chain (from its own operations to energy supply, transport and distribution, use of products and the rest of the value chain). Companies should disclose the sources of emissions included and excluded from the target boundary.

2.     Set carbon reduction targets in line with 1.5°C: companies must aim to eliminate sources of emissions within its value-chain at a pace and scale consistent with mitigation pathways that limit warming to 1.5°C with no or limited overshoot. Recent data shows science-based targets are driving corporate decarbonization - between 2015 and 2020 companies with validated targets cut emissions by 25% compared with an increase of 3.4% in global energy and industrial emissions.

3.     Aim for 2030 but not at the expense of carbon reduction: Companies should reach net-zero emissions by no later than 2050. While earlier target years are encouraged, a more ambitious timeframe that can be achieved by high levels of carbon offsetting is less desirable than a longer timeframe with a high levels of carbon reduction.

4.     Remove sources of emissions within your value chain: Companies should follow a mitigation hierarchy that prioritizes eliminating sources of emissions within the value chain of the company over compensation or neutralization measures. Land-based climate strategies should prioritize interventions that help preserve and enhance existing terrestrial carbon stocks, within and beyond the value chain of the company.

5. Neutralise residual emissions using long-term carbon removals: Reaching net-zero emissions requires neutralizing a company’s residual GHG emissions with an equivalent amount of carbon removals. An effective neutralization strategy involves removing carbon from the atmosphere and storing it for a long-enough period to fully neutralize the impact of any GHG that continues to be released into the atmosphere.

• Carbon removal with short-lived storage includes: afforestation and reforestation, soil carbon enhancement and ecosystem restoration.

• Carbon removal with long-lived storage includes DACCS, BECCS, mineralisation (converting atmospheric carbon into rock) and enhanced weathering (enhancing natural processes of rocks' and minerals' weathering to sequester CO2).

Get in touch

Do get in touch if you think we’ve missed something crucial or you’d like to discuss how we can help you to develop a robust net zero carbon strategy. BRODIE works with several of the world’s leading environmental consultancies and data experts to develop net zero strategies. Our role is to connect your climate strategies into core strategy and work with you to embed the changes needed across the business to realise your ambitions.  

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