Stay ahead of compliance: Navigating the GHG Protocol Scope 2 revisions

Sustainability managers and energy procurement teams are preparing for the biggest overhaul to carbon accounting standards in a decade. If you're wondering how the new Scope 2 rules will affect your carbon reporting and renewable energy procurement strategy, this guide will help you navigate the changes ahead.

The Greenhouse Gas (GHG) Protocol is finalizing significant updates to its Scope 2 Guidance – the global benchmark for reporting emissions from purchased electricity. With public consultation running until 19 December, organizations have a limited window to understand what's changing and contribute to the process.

For sustainability managers, energy procurement teams, and finance directors across the globe, these revisions aren't just technical adjustments. They carry direct implications for compliance strategies, renewable energy investments, and corporate climate targets.

What changes are proposed in the Scope 2 framework?

The updated framework maintains the dual reporting requirement for location-based and market-based methods that companies have used since 2015. However, the rules governing emission factors, contractual instruments like Energy Attribute Certificates (EACs), and matching requirements are getting significantly tighter.

The table below provides an overview of the most critical changes:

Current vs. proposed rules

The shift to hourly matching: what it means for your procurement strategy

One of the most significant changes is the move toward hourly matching of Energy Attribute Certificates. Under the current guidance, companies can purchase EACs on an annual basis and claim carbon reductions regardless of when the renewable energy was actually generated. The proposed rules tighten this considerably.

Under the tabled proposal, certificates must align with consumption on an hourly basis. This means that an EAC from solar generation at noon can only offset electricity consumed during that same hour – not consumption that occurred overnight.

To make hourly matching practical and accessible, organizations may use load profiles, which are simple hourly curves that show how electricity use or generation rises and falls throughout the year. This approach allows companies to estimate the hourly granularity of their EACs without requiring complex metering infrastructure.

For energy procurement teams, this represents a fundamental shift. Annual certificate-based strategies may no longer suffice. Instead, organizations will need to think about renewable energy procurement the same way they approach Power Purchase Agreements (PPAs) – with hourly profile analysis at the centre of the strategy.

For example, an optimal EAC portfolio in a given region might look like this: 40% solar, 40% wind, and 20% hydro to achieve 80% hourly coverage. This type of analysis, already standard practice for PPAs, might now become critical for EAC procurement as well.

Deliverability and residual mix: closing the loopholes

Another key revision addresses deliverability. Under the current rules, companies can purchase EACs from renewable projects that are physically distant from their operations, sometimes across entire continents. The updated guidance requires that certificates be sourced from generation that is deliverable to the location where electricity is consumed.

This change is designed to ensure that claimed reductions reflect real decarbonization of the grid supplying your facilities – not just the purchase of paper certificates from faraway projects.

Similarly, the residual mix rules are tightening. Currently, if a residual mix factor (which accounts for unclaimed renewable generation) isn't available, companies can fall back on grid-average emission factors. Under the proposed guidance, organizations must use residual mix factors wherever possible. If unavailable, they must apply fossil-only factors – a much more conservative approach that discourages greenwashing.

When spatial boundary and temporal granularity conflict

Proposed updates to the location-based method requirements centre on a new emission factor hierarchy that provides more guidance on spatial and temporal granularity. Reporting organizations would be directed to prioritize emission factors using the most precise location information (i.e., spatial boundary) first, followed by the most precise time matching (i.e., temporal granularity). For example, given the choice between two emission factors, the first one being a national emission factor with hourly temporal resolution, and the second one being a local emission factor with annual temporal resolution, the second emission factor should be selected.

In addition, the updated emission factor hierarchy distinguishes between ‘production-based’ factors and ‘consumption-based’ factors, with consumption-based factors prioritized. Production-based factors are calculated using an average of only the generating resources within a region, while consumption-based factors also account for imported and exported power between regions. By including imports and exports, consumption-based factors more accurately approximate the mix of resources used to deliver power to consumers, therefore these factors are prioritized above production-based factors.

Emission factor precision: a double-edged sword

The proposed revisions also call for greater precision in emission factors, prioritizing spatial and temporal accuracy over simplified national averages. Companies will be required to use the most precise accessible emission factors that align with their activity data.

However, there's a potential tension here. The draft guidance defines "accessible" as publicly available, free, and from a credible source. This dual requirement – greater precision and free availability – raises an important question: are there enough publicly available, hourly emission factor datasets to meet this standard?

For organizations operating in regions with limited data transparency, this could present a compliance challenge.

An important remark under the current consultation is that “Reporting organizations are required to use the most precise emission factors accessible to them, for which the same level of activity data is also available. For example, if a company has access to hourly emission factors, but can only source annual activity data, they are not required to calculate location-based emissions on an hourly basis and can instead use annual emission factors” (Overview of Revisions, GHG Protocol).

Why this matters for your organization

For sustainability managers

Stricter rules mean that reported reductions will better align with real grid decarbonization, reducing the risk of greenwashing and strengthening the credibility of your disclosures. However, it also means that achieving the same level of claimed reduction may require more sophisticated procurement strategies and higher-quality instruments. This could mean that a common practice of a '100% renewable electricity target by 2030' would be replaced by a more achievable target of 50% locational and temporal renewable electricity target by 2030.

The approach towards this could be very different for companies with a continuous production process versus companies with a flexible, steerable production process.

For energy procurement teams

The shift to hourly matching and deliverability requirements fundamentally changes how EACs should be sourced and valued. Procurement strategies that worked under the 2015 guidance may no longer deliver the same carbon accounting benefits. Now is the time to begin integrating hourly profile analysis into your EAC procurement processes. At the same time, it is important to track the outcome of this consultation to see what the implementation date of any changes could be as this could impact your EAC procurement practice for the period as of 2029, for example. Another approach is to include regulatory change clauses that allow you to adjust your EACs when regulations shift, whether in a bundled or unbundled contract structure..

For finance directors

Investment strategies for renewable energy and carbon reduction must account for the shifting value of contractual instruments under the new framework. EACs that don't meet hourly matching or deliverability criteria may lose value, while those that do could command a premium, i.e. EACs produced at moments of abundance might have a different value than those produced at moments of scarcity, leading to price spreads based on time and location and increasing volatility. The weather will drive the prices. Early preparation can help mitigate financial risk and ensure capital is deployed effectively.

What about existing (PPA/EAC) contracts?

It is important to note that under the current consultation, a legacy clause is being developed to ensure investments made under existing Scope 2 accounting rules are appropriately recognized.

Timeline: what to expect

To give organizations time to adapt, the revisions will be phased in over several years:

• October 2025: Public consultation period opens
• Late 2027: Final standard published
• 2027–2030: Phased implementation period, with legacy clauses under consideration for existing investments

This phased approach provides a window of opportunity to prepare, but it's closing quickly. Understanding the timeline is crucial, but equally important is taking action now. Here's how to prepare:

Next steps: how to prepare

1. Engage in the public consultation
   The consultation period (October–November 2025) is your opportunity to provide input and help shape the final rules. If your organization has concerns about data availability, implementation timelines, or specific provisions, now is the time to raise them.
   
   
2. Assess your current reporting practices
   Conduct an internal audit of how your organization currently reports Scope 2 emissions. Identify gaps between your existing practices and the proposed requirements, particularly around hourly matching, deliverability, and emission factor precision.
   
   
3. Prepare for phased adoption
   Work with your energy procurement and sustainability teams to begin integrating hourly data, load profile analysis, and deliverability considerations into your renewable energy strategy. As stated earlier, it will be important to track the outcome of this consultation to see what the implementation date of any changes could be as this could, for example, impact your EAC procurement practice for the period as of 2029. The sooner you start, the smoother the transition will be.
   
   
4. Monitor the evolution of emission factor datasets
   Keep an eye on the availability of publicly accessible, hourly emission factor datasets in your regions of operation. Advocate for greater data transparency where gaps exist.

Is this all set in stone?

These revisions aren't yet finalized. They're proposals undergoing public consultation, which means your organization has an opportunity to influence the final rules. After the consultation, this proposal needs ISB/SC approval as described in the Standard Development and Revision Procedure of the Greenhouse Gas Protocol. The potential publication of the revised Scope 2 Standard is anticipated for late 2027, implementation is expected to phase in over multiple years as described earlier in the article. However, the direction of travel is clear: the GHG Protocol is moving toward greater precision, transparency, and accountability in Scope 2 reporting.

Source: Standard Development and Revision Procedure, GHG Protocol

One key area where clarity is still needed is the definition of 'smaller organizations' that may be exempt from hourly matching requirements. The public consultation currently states, “Current proposals under consideration include thresholds based on the volume of electricity consumption in a given grid region and/or on company size. Initial analysis on the application of load thresholds has shown that a majority of CDP reporting companies would be exempt from requirements to hourly match, while the vast majority of electricity load on the grid would still be subject to the hourly matching requirement” (Overview of Revisions, GHG Protocol). It is expected that, after the consultation, more specific guidance on size thresholds, annual consumption levels, or other criteria that will determine which companies qualify for these exemptions will be provided.

Organizations that act early will be better positioned to meet compliance demands, strengthen their climate disclosures, and support meaningful decarbonization. Those who wait risk scrambling to adapt once the final rules take effect.

For more detailed information, visit the GHG Protocol's official blog: https://ghgprotocol.org/blog/upcoming-scope-2-public-consultation-overview-revisions

To participate in the public consultation, go to the GHG Protocol website and complete the survey: GHG Protocol Public Consultations | GHG Protocol

Want to stay ahead of the curve? Our team is closely monitoring the GHG Protocol consultation process and can help you assess the impact on your organization. Reach out to learn how we can support your transition to the new Scope 2 framework.

As electricity markets and EACs move toward shorter time horizons and finer temporal granularity, reliable data collection and sophisticated management systems are no longer optional – they're essential. E&C's Meter ETL and ePoint can support this transition. Reach out to explore how they can help your organization prepare.