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  • Writer's pictureRob Threlkeld

Understanding Our Impact: Accounting for Scope 2 Emissions When and Where They Happen



To make impactful decisions around decarbonization, we need near real-time accounting of our Scope 2 emissions.


Since announcing our vision of Zero Crashes, Zero Emissions, and Zero Congestion in 2016, General Motors has been charting a course to achieve carbon neutrality by 2040. In October 2022, we announced that General Motors has secured the renewable energy needed to cover 100% of our U.S. operations by 2025, and as the top automaker purchasing renewable energy by capacity, we aim to achieve 100% renewable energy for our operations globally by 2035. To decarbonize electricity grids as quickly as possible, however, we believe that modernizing carbon accounting standards is essential to ensure companies make even more strategic decisions around clean energy investments.


As a founding member of the Emissions First Partnership, we advocate for critical updates to the Greenhouse Gas Protocol corporate accounting standards that enable even greater Scope 2 emissions reduction impact by recognizing the importance of two key variables: location and time. In this decade of action, General Motors recognizes that corporate buyers of clean energy have a critical role to play in accelerating decarbonization, and we are at the forefront of putting this into practice.


Impact Accounting


Published in 2015, the current version of the Greenhouse Gas Protocol’s Scope 2 Guidance has a dual reporting requirement for disclosing both location-based and market-based emissions of power generation purchased by an energy consumer. This dual reporting requirement has been instrumental in spurring growth in voluntary corporate procurement of renewable energy with instruments known as energy attribute certificates. However, modern datasets are much more robust in accounting for time and location of emissions. While not all markets have progressed at the same pace in terms of data availability, we believe that clear market signals exist to drive greater impact on clean energy procurement and grid operations.

Much in the same way locational marginal pricing (LMP) is the basis for intelligent decision-making in power markets, locational marginal emission data can provide a much more accurate quantification of emissions and influence a company’s operational decisions near real time. Now that the Greenhouse Gas Protocol is undergoing revisions, GM supports modernizing Scope 2 Guidance to prioritize use of marginal emission factors in markets where that data is available.


We believe that such a revision will not only improve reporting accuracy but could also accelerate more impactful procurement decisions.


Real-time tracking:


General Motors follows a 4-pillar approach for our Renewable Energy Strategy: 1) improving energy efficiency; 2) sourcing renewable energy; 3) addressing intermittency, and 4) policy advocacy. Underpinning these four pillars is our view that GHG accounting should move beyond energy matching to emissions matching.


To accurately track our Scope 2 emissions and enable near real time decision-making, we are working with TimberRock to develop the next-generation Energy Data Platform. TimberRock is a technology-enabled energy company, and their platform integrates real-time energy consumption from our facilities and energy generation from our renewable projects. By pairing this data with marginal emission rates from PJM and others, the Energy Data Platform allows General Motors to make operational decisions based on the carbon output of the grid at a given time. For example, when the grid is operating at periods of high emissions intensity, we can decide to dispatch stored renewable energy or shift operations to temporarily reduce the amount of power being consumed. When we are able to expand this to bidirectional charging of electric vehicles, we can help customers and fleet operators in their efforts to optimize charging and discharging based on grid intensities.

Even without such robust platforms, the idea behind directly accounting for emissions rather than by proxy allows for companies to make informed decisions around when and where to procure clean energy resources. Analyzing data from one of our windfarms in Ohio in 2023, General Motors avoided over 138,000 metric tons of emissions based on locational marginal emission rates. However, by following the current market-based methodology which matches energy with the emission factors specified in the GHG Protocol data hierarchy, we can only report 132,000 metric tons of avoided emissions. Moreover, if that same project operating in the same timeframe was instead physically located in Texas, it would roughly equate to 103,000 metric tons of avoided emissions. This demonstrates how strategic sourcing decisions can have a tremendous influence on a company’s own decarbonization pathway as well as broader, system-wide impacts.


As the GHG Protocol begins to formalize members within the governance structure this month, we are committed to ensuring that updates to the carbon accounting standards are well-designed and enable interested companies to invest in clean energy projects that can help maximize decarbonization impact. General Motors recognizes the critical urgency of climate action, and we’re excited to work with the Emissions First Partnership to modernize emissions accounting.

 

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