Why SSS Matters for Corporate Carbon Accounting

For corporations pursuing accurate Scope 2 emissions reporting under the GHG Protocol, SSS plays a critical role in market-based accounting, serving as the default baseline for uncontracted electricity loads. It enables companies to claim embedded clean energy attributes (e.g., mandated renewables or nuclear) without additional procurement, but its limitations—especially under emerging hourly matching rules—highlight the need for granular data and potential supplementation via platforms like the Granular Registry and Marketplace.

In dual-reporting Scope 2 frameworks:

• Location-Based Accounting: SSS is irrelevant here, as emissions are calculated using regional grid-average factors (e.g., eGRID subregions in the U.S.). This method reflects the physical grid's carbon intensity, unaffected by supplier choices.

• Market-Based Accounting: SSS excels by allowing the use of supplier-specific emission factors (SSEFs) that incorporate retired attributes, often resulting in lower reported emissions compared to grid averages. For example, if your utility retires RECs to achieve 30% RPS compliance, you can claim that share as zero-emission, thereby reducing your SSEF (e.g., from 0.4 kg CO₂/kWh to 0.32 kg CO₂/kWh). Pro-rata allocation is straightforward: Claimable REC MWh = (Total SSS REC MWh / Utility Retail Sales MWh) × Your Load MWh.

Why it matters strategically:

• Credible Claims Without Extra Cost: SSS credits mandatory clean energy (e.g., RPS RECs, ZECs for nuclear) backed by retired certificates, meeting GHG Protocol quality criteria. This avoids double-counting and supports auditable reports, as seen in utilities like PG&E (96% GHG-free in 2022 due to RPS, nuclear, and hydro).

• Fallback to Residual Mix: If no SSEF is available, use residual factors (e.g., AIB in Europe, Green-e in the U.S.), which strip out claimed renewables, potentially increasing your emissions if clean attributes are sold elsewhere. This ensures market integrity but underscores SSS's variability.

• Hourly Matching Challenges: Under draft GHG Protocol updates requiring Granular Certificates (GCs) for time-matched claims, SSS's annual averages fall short—e.g., solar attributes can't offset nighttime fossil use. Without hourly data, default to hourly residual mixes, potentially aligning market-based emissions more closely with location-based ones. To bridge gaps, procure time-stamped GCs via the Granular Marketplace.

• Risks and Opportunities: Over-reliance on SSS may limit ambitious goals (e.g., 100% renewable claims), as it lacks additionality and temporal precision. However, it provides a defendable baseline; enhance it by estimating retired RECs using public sources (e.g., EIA Form 861, RPS reports) when utilities don't submit data to the Granular Registry.

Summary

SSS simplifies baseline accounting but demands rigorous documentation to substantiate claims. For Clean Incentive clients, integrating SSS data into the Registry ensures transparency, while Marketplace tools enable upgrades to hourly-matched procurement for deeper decarbonization.