Scope 3 emissions for mining consist of all other indirect emissions that the organization impacts, both upstream . "We are already doing this in aluminum and now, through this partnership, we will be doing it in the steel industry." Scope 3 emissions in mining will be a key session at the Energy and Mines Australia Summit 2020 - to get involved contacts adrienne.baker@energyandmines.com . 2 These factors are applicable to employee commuting as well as business travel. While the green version might not always command a price premium, it could set your company apart from competitors and help you increase market share as customers increasingly look for green products and meet commitments. While Scope 1 and 2 emissions are directly . However, miners cannot wait too long to set firm commitments. Nature-based solutions also play an essential role in this process; today, Vale helps protect more than one million hectares of forestry worldwide and by 2030, it plans to cover another 500,000 through recovery and protection projects. As part of the energy transition, the reporting of GHG emissions, including Scope 3 emissions, is therefore developing from being a voluntary reporting . But as they fall out of the companys direct control, many companies avoid making direct statements on their reduction. The top stories of the day delivered to you every weekday. When it comes to Scope 3, you have to think about both your role as a supplier to your customers and your role as a customer to your suppliers. Despite the significant challenges, according to Vining, this raises the possibility of the iron and steel value chain going that step further to produce green steel. Then calculate emissions the same as for scope 2 electricity, using eGRID emission factors. While miners have plans to reduce scope 1 and 2 emissions, scope 3 targets are lacking. Cutting emissions is existential for the steel industry, but its also a huge concern for some of the top miners who make much of their profits from iron ore, the key steelmaking ingredient. PwC has defined an ESG framework with nine building blocks for a successful net zero transformation and decarbonization strategy across your business. In addition, because scope 3 emission sources may represent the majority of an organizations GHG emissions, they often offer emissions reduction opportunities. Kerkhoff said Kloeckner is going to be the biggest customer of the H2 Green Steel venture once it starts production and the steel volume acquired from Kloeckner would address 10% of the stockholder's Scope 3 emissions. Scope 2 accounts for Greenhouse Gas Emissions from the generation of purchase d electricity, steam, and heating/cooling. The GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard presents details on all scope 3 categories and requirements and guidance on reporting scope 3 emissions. Given its far-reaching impact, every area of the business could be affected, from supply chain and product development to reporting and tax, to marketing and, of course, sustainability. If a company's Scope 3 emissions make up more than 40% of its total emissions, then the near-term target must cover two-thirds (67%) of Scope 3 emissions. Each member firm is a separate legal entity. Mark Van Baal, founder of Dutch activist shareholder group Follow This, has argued that these companies must be pressured by investors to adopt these green business models earlier to take advantage of shifts in consumer behaviour, such as an increased demand for low-emissions products and services thathich could see the worlds largest companies realise over $2.1tn in value. A detailed estimation model can help highlight potential climate-transition risks for investors in companies upstream and downstream in the value chain. JavaScript appears to be disabled on this computer. | Findings by the Responsible Mining Initiative, which analysed 38 of the worlds biggest listed mining firms, found that most were highlighting or overstating their positive SDG contributions in their annual reporting. For example, if an oil and gas company sells all of its fuel to a mining company, and this mining company uses only this companys products to run its mine, the downstream Scope 3 emissions of the oil and gas company should essentially be equivalent to the mining companys Scope 1 emissions. This may be true for the carbon footprint of an investment portfolio as well. Regulators are increasingly focusing on Scope 3. Besides China, most regions, particularly India, Africa and South-East Asia, will see an increase in demand. stations, or processing our iron ore to steel). When you approach Scope 3 systematically and strategically, you not only can progress on commitments but can also reap significant benefits like growing your market share. Asset Managers (Quant or Fundamental) Other upstream categories include business travel and employee commuting as well as emissions from waste generated and assets leased. One gap in their knowledge is how to tackle emissions from the value chain of the companies in which they invest. A big enough dataset makes it possible to alleviate concerns about possible double counting of emissions across an investment portfolio. The Greenhouse Gas (GHG) Protocol categorizes greenhouse gas emissions into three groups or 'Scopes'. The most ambitious scope 3 targets are set using a science-based targets setting method. Please use the button below and we will bring you back here when complete. | Scope 3. 3 Emission intensity includes scope 1 and 2 emissions; 4 Other energy . These methods are designed for addressing scope 1 and 2 emissions, but they can be applied to scope 3 as well. Elizabeth Gaines says the company is transitioning from an iron ore producer to a green renewables and resources company. Between 1995 and 2015, global scopes 1, 2, and 3 emissions grew by 47%, 78%, and 84%, to 32, 10, and 45 Pg CO 2, respectively. The GHG protocol describes Scope 3 emissions as 'all indirect emissions that occur in the value chain of the reporting company, including both upstream and downstream.' According to the IPCC, many organizations report . The semiconductor shortage did have an impact on Q3 volumes. Food waste emissions are large: one-quarter of emissions (3.3 billion tonnes of CO 2 eq) from food production ends up as wastage either from supply chain losses or consumers. Environmental sustainability indicators. Scope 3 emissions include all sources not within an organizations scope 1 and 2 boundary. The Melbourne-based miners scope 3 emissions were 402.5MTCO2E in the 12 months to 30 June, with iron ore making up an estimated 205.6 to 322.6 million tonnes contribution to that total. How can we engage and educate customers about our Scope 3 strategy? Scope 1 covers direct emissions from owned or controlled sources, while scope 2 includes indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by the reporting company.Scope 3 includes all other indirect emissions from a company's value chain. Hestated: One of the biggest emitters of carbon in the iron making value chain is the use of metallurgical coke in the blast furnace, and the simplest way we can influence how that is reduced is by upgrading the material before shipping it overseas. Coal Supply Woes A Push for Renewables in India? This challenge is driven by three key developments that go beyond the . Source: MSCI ESG Research LLC, MSCI ACWI IMI constituents as of March 31, 2020. Kloeckner continued its margin-over-volume strategy, opting for higher priced sales instead of large bookings, while the uptake from auto was muted. 2For detail on the individual categories, see: Technical Guidance for Calculating Scope 3 Emissions. Greenhouse Gas Protocol, October 2013. Steel is the most emission-intensive material, accounting for 3,749 million tonnes of carbon dioxide equivalent (MTCO2e) in 2020, compared to 818MTCO2e for aluminium, the second-highest polluter. Global investors are increasingly looking to identify opportunities to mitigate climate risks and support the transition to a world of net-zero emissions. How can we improve the quality of our data to better manage our emissions? Fuel combustion. The bank said that it will advise clients in carbon-intensive industries and finance their transition strategies and efforts on the path to achieving net zero emissions by 2050. One way around this problem is to use de-duplication multipliers. If you have a big enough dataset (i.e., a universe encompassing thousands of companies), it is possible to estimate the amount of would-be duplicated emissions across a portfolio and adjust for it. Likewise, a retailer or hotel group might have many franchisees, category 14. When applied, the multiplier results in a figure closer to the actual carbon footprint. A new SEC rule requires all registrants to disclose information on climate risks. A company's Scope 3 carbon emissions include everything beyond its direct operations and electricity use, including supply-chain operations and end-product usage by customers. Scope 2. This can be challenging and there are some common pitfalls to avoid with data modeling and extrapolation. Scope 3 emissions fall within 15 categories, though not every category will be relevant to all organizations. Energy companies can help set up carbon capture and storage facilities at steel plants to lower their emissions. Fugitive emissions. Despite the ever-improving efficiency of blast furnaces, it is still a carbon-based method that makes achieving total net zero an impossibility if use continues to be high. EPA Center for Corporate Climate Leadership, GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard, WRI/WBCSD Corporate Value Chain (Scope 3) Accounting and Reporting Standard (pdf), Guidance for Calculating Scope 3 Emissions, Guidance for calculating scope 3 emissions resulting from events (e.g., sporting events, concerts) and conferences (e.g., business meetings, exhibits, conventions). Globally, the industry sector was most . There are potential partnership opportunities . Scope 1 . Below is a list of emission sources and the location of the factors in the GHG Emission Factors Hub.. | Major miners have committed to focus on the investment into technology to reduce the carbon intensity of steelmaking. Scope 1. The state of Scope 3 reporting is poor. 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