Value Chain Abatement Needs Flexible Tools – the AIM Platform is Here to Help

Value Chain Abatement Needs Flexible Tools

Value Chain Abatement (VCA), the act of abating sources of emissions within a company’s value chain (scope 2 or 3 emissions inventories), is a cornerstone of corporate voluntary climate action. With value chains often accounting for over 90% of company emissions, the opportunity for mitigation is vast.

But value chains are extensive, complex, dynamic and almost never fully visible or accessible to the companies responsible for them. If time were on our side then traceability and data quality improvements would resolve some, maybe most, of these issues, allowing direct abatement with the specific suppliers of specific companies. Time is not on our side, however. Companies need flexible tools that enable them to take responsibility for emissions they can’t address.

Efforts to provide such tools to date have been blighted with criticism; of inefficacy and ineffectiveness and of greenwashing and lack of transparency. Perhaps the most often maligned example are renewable energy certificates, which in some cases – though surely not all – represent taking the easy way out and fail to drive real benefit to the atmosphere.

Despite those criticisms, the question of how companies should act on sources of value chain emissions that they can’t currently see, access, control or influence is valid. Likewise how to bring forward transitional change, such as large scale technology shifts rather than piecemeal interventions by a few climate leading companies. A flexible, science-based, credible, effective and honest solution therefore needs to exist in order to accelerate action through abatement in the value chains in which a company operates – even if not with the specific companies currently represented in their own value chain. 

The underlying intent of value chain abatement targets is to direct accountability and force deep reflection on the current business models and practices of companies. Any flexible approaches should respect this and therefore neither displace efforts to improve visibility and access, nor encourage a shift away from direct action to address a company’s visible value chain. Rather it should supplement those efforts such that in the end, at Net Zero, it becomes irrelevant, because the value chain has been decarbonised and therefore accurate, “physical” reporting is fully aligned. Some pioneering examples of flexible approaches to value chain abatement can be found here.

The AIM Platform, founded by C2ES, Neoteric Energy and Climate and Gold Standard, was created earlier this year with the mission of unlocking the full potential of value chain abatement targets. We have established an expert Governing Committee from civil society, standards, business and philanthropies and are working closely with the GHG Protocol and Science Based Targets Initiative. By learning from the past and looking forward into the logical framework of corporate voluntary action, the AIM Platform will create a suite of tools that enables advanced and indirect mitigation action to decarbonize value chains at scale. More about AIM and our ambitious work plan can be found here.

By Owen Hewlett, Chief Technical Officer at the Gold Standard Foundation

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