Quantifying Corporate Residual Emissions : An Assessment on EU-Headquartered Companies with SBTi Net-Zero Targets

Sammanfattning

To reach the targets of the Paris Agreement, an increasingly common strategy to frame targets is the establishment of net zero commitments. While there is consensus that some degree of carbon dioxide removal (CDR) will be required, the magnitude of residual emissions that will persist when reaching corporate net zero targets and consequently the required volume of CDR, is uncertain. This study quantifies the residual emissions by the categories used to track a company's greenhouse gas (GHG) emissions across the value chain (i.e. Scope 1, 2 & 3). Residual emissions were calculated from 303 EU-headquartered companies that have validated long-term net-zero targets under the Science Based Targets initiative (SBTi) Corporate Net-Zero Standard. Results show that the total residual emissions range from 366 to 760 MtCO₂e annually by the companies' target years (predominantly 2050), representing 10-20% of their collective baseline emissions. Findings reveal that Scope 3 emissions constitute the vast majority (87-89%) of these residuals, with Chemicals & Manufacturing, Energy & Utilities and Construction & Materials emerging as the highest contributing sectors. Comparison with regional projections indicates that the potential CDR demand from this sample alone could meet or exceed the EU's anticipated CDR supply by 2050. Further, qualitative insights from interviews with EU-headquartered companies with SBTi net zerotargets highlight significant challenges in abating Scope 3 emissions and a primary focus on near-term reductions with limited strategies for residual emission neutralization at the target year. The study concludes that the substantial corporate residual emissions quantified in this study will necessitate significant CDR scale-up and improved corporate and governmental planning for residual emissions to support CDR innovation and scaling.