What is Net Zero? What does offsetting mean? Our glossary will help explain the terminology surrounding sustainability.
Net zero means reaching a balance between the carbon emitted to the atmosphere – e.g. through burning fossil fuels and producing other waste - and the carbon removed from the atmosphere through carbon capture or land use.
UK Government Net Zero Strategy
In June 2019 the UK government became the first major economy to commit an entire country to Net Zero emissions, with a target date of 2050. Since carbon emissions are a major contributor to climate change, this Net Zero target aims to help limit global warming to 1.5oC by 2100.
Government and Company Actions
Government has instituted two main pieces of legislation to encourage companies to reduce energy use and emissions; ESOS and SECR explained below. Many companies have already set Net Zero targets and are in the process of establishing Net Zero plans. Some industries are unlikely to be able to achieve Net Zero, which means others may need to become Carbon Negative, i.e. storing more carbon than they produce
SECR – Streamlined Energy and Carbon Reporting
A SECR report identifying annual energy consumption and emissions must be included in the Annual Directors Report for any qualifying company for all financial years starting on or after 1st April 2019.
ESOS – The Energy Savings Opportunity Scheme
A four yearly, mandatory process that applies to “large companies”, ESOS focusses on energy consumption (e.g. electricity, gas and vehicle fuel).
CO2 equivalent (CO2e)
CO2e is the standard carbon accounting unit which takes into account the differing global warming impact of each green house gas (GHG) and converts into a consistent unit for ease of comparison.
Scope 1, 2 and 3 emissions
Scope 1 - Direct emissions from company owned vehicles, boilers and other equipment.
Scope 2 – Indirect emissions from purchased energy such as electricity used in company operations.
Scope 3 – All other indirect emissions such as business travel and waste disposal.
Offsetting involves permanently removing greenhouse gas emissions from the atmosphere, usually through creating or restoring habitats which absorb emissions