GHG Protocol Unveils 'Land Sector & Removals Standard v1.0': New Accounting Guidance for Agriculture and CO2 Removal
This article is an automatically translated version of the original Japanese article. Please refer to the Japanese version for the most accurate information.
Source: GREENHOUSE GAS PROTOCOL "Land Sector and Removals Standard Version 1.0: Agriculture and CO2 removal technologies Executive Summary"
Overview
The GHG Protocol has released an executive summary of the "Land Sector and Removals Standard (LSRG) Version 1.0." This standard provides comprehensive requirements and guidance for quantifying, reporting, and tracking land sector emissions and carbon dioxide (CO2) removals within a company's Greenhouse Gas (GHG) Inventory. It specifically focuses on agricultural activities and engineered CO2 removal (CDR) technologies, complementing existing GHG Protocol Corporate Standard and Scope 3 Standard.
Key Points
1. Comprehensive Accounting for Land Sector Activities
This standard sets out requirements for companies to clearly account for and report GHG emissions and CO2 removals from land they own or manage, the purchase and sale of agricultural products, and other related land-based activities. This enables the inclusion of land sector emissions, which have traditionally been underreported or excluded, in companies' inventories.
2. Special Focus on Agriculture and CO2 Removal Technologies
Version 1.0 focuses on agriculture and Carbon Dioxide Removal (CDR) technologies. While forestry activities are not included, future versions are suggested to consider them, indicating an acknowledgment of the accounting challenges in this area and a pathway for future expansion.
3. Separate Reporting of Emissions and Removals with Rigorous Requirements
Companies are required to report emissions and removals distinctly and separately. While reporting CO2 removals is optional, if chosen, additional rigorous requirements apply regarding associated life cycle emissions, traceability, data quality, and permanence, promoting transparent and reliable disclosure.
Background
Globally, the Agriculture, Forestry, and Other Land Use (AFOLU) sector accounts for approximately 22% of annual anthropogenic GHG emissions, while global land carbon sinks remove about 30% of annual net CO2 emissions. Achieving the Paris Agreement's 1.5°C target requires an additional 100 billion to 1 trillion tons of CO2 removal by the end of this century, making land sector mitigation measures and new CO2 removal technologies critically important. Against this background, the standard was developed to provide an internationally agreed, standardized framework for companies to more accurately measure and manage their climate impact in the land sector.
Details
This standard complements the GHG Protocol Corporate Standard and Scope 3 Standard, introducing detailed accounting categories and requirements specifically for the land sector.
1. Scope and Covered Activities
- Agriculture and other land-based sectors: Companies that own or manage land, such as agricultural producers, food and beverage companies, bioenergy producers, and retailers, as well as companies with agricultural products in their supply chains.
- Engineered CO2 removals and CO2 capture with geological storage: Companies that own or operate CO2 removal projects such as Direct Air Capture (DAC) facilities or Bioenergy Carbon Capture and Storage (BECCS) with geological storage.
- Exclusion of forestry: Version 1.0 does not cover forestry, but changes in biomass carbon stocks on productive agricultural land (e.g., agroforestry) and land use change emissions from the conversion of natural forests to managed forests are included.
2. Key Accounting Categories
The standard introduces the following accounting categories for activities in the land sector value chain and engineered CO2 removal (TCDR) value chain.
GHG Inventory Categories for Land Sector Value Chain
| Category | Sub-category | Mandatory/Optional | Description |
|---|---|---|---|
| Emissions | Fossil fuel and industrial emissions | Mandatory | Emissions in accordance with the Corporate Standard |
| Land use change emissions | Mandatory | Emissions from land conversion and deforestation | |
| Net biogenic CO2 emissions from land management | Mandatory | Net CO2 emissions from carbon pool changes due to land management activities in agricultural areas | |
| Land management production emissions | Mandatory | Non-CO2 (Methane, Nitrous Oxide, etc.) emissions from agricultural production activities | |
| Biogenic product CO2 emissions | Mandatory | Life cycle emissions of biogenic products | |
| Removals | Land management CO2 removals | Mandatory | Net increase in carbon stock in agricultural areas |
| Additional Categories | Land use (land occupation) | Optional | Company's contribution to global agricultural land use |
| Land carbon leakage | Optional | Impact of agricultural activities leading to increased emissions elsewhere | |
| Gross CO2 fluxes (gross emissions and removals) | Optional | Indicates total CO2 inflows and outflows in the carbon cycle | |
| Product carbon storage | Optional | Amount of CO2 removal-derived carbon stored in products | |
| Reversal | Optional | Emissions from loss of stored carbon |
GHG Inventory Categories for Engineered CO2 Removal (TCDR) Value Chain
| Category | Sub-category | Mandatory/Optional | Description |
|---|---|---|---|
| Emissions | Fossil fuel and industrial emissions | Mandatory | Emissions in accordance with the Corporate Standard |
| Captured biogenic CO2 and geological storage | Mandatory | Geological storage through BECCS, etc. Not reported as emissions. | |
| Removals | Engineered CO2 removals via geological storage | Mandatory | CO2 directly removed and stored from the atmosphere, such as by DACCS and BECCS |
| Additional Categories | TCDR-based product CO2 emissions | Optional | Life cycle emissions of products containing TCDR-derived carbon |
| Total CO2 emissions from geological storage | Optional | Emissions associated with the loss of geologically stored CO2 | |
| Total engineered CO2 removals from geological storage | Optional | Total amount of geologically stored CO2 removed | |
| TCDR-based product carbon storage | Optional | Amount of TCDR-derived carbon stored in products | |
| Reversals from geological storage | Optional | Loss of geologically stored CO2 |
3. Traceability and Spatial Boundaries
Companies must establish "spatial boundaries" and "traceability" for land and its activities to accurately account for GHG emissions and removals in both Scope 1 (land owned or managed) and Scope 3 (e.g., procurement regions within the value chain). This highlights the importance of the ability to track activities across the entire supply chain, especially for Scope 3.
- Spatial Boundary Definition: Scope 1 is defined based on the organizational boundary, while Scope 3 is defined based on traceability levels (global, jurisdictional boundary, procurement region, Land Management Unit [LMU], harvest area). The same spatial boundary must be applied to all land-related emissions, removals, and other metrics (Requirement 5).
- Physical Traceability: When applying procurement region, LMU, or harvest area as a Scope 3 spatial boundary, companies must establish physical traceability through certification programs or audited internal systems (Requirement 8). For mass balance approaches, physical traceability **cannot be demonstrated** if Book-and-claim is used, or if input and output quantities are unknown, or if non-proportional allocation is used.
4. Goal Setting, Progress Tracking, and Credit Handling
The standard also provides a framework for companies to set climate targets and track their progress. GHG credits (quantified emission reductions or removals that can be transferred between companies) are reported separately from the GHG inventory, with requirements specified to avoid Double Counting.
5. Assurance and Reporting Transparency
Third-party assurance is recommended to ensure the completeness, accuracy, consistency, transparency, and relevance of the GHG inventory. To comply with this standard, companies must disclose detailed information for all mandatory accounting categories.
Summary
The long-awaited LSRG (Land Sector and Removals Standard) has been released.
"3. Traceability and Spatial Boundaries" will be a critical discussion point for industries related to the FLAG sector regarding how to quantify removals. While this article omits the details, it explicitly states that the "mass balance" approach, commonly used as a Chain of Custody, is conditionally accepted, but the Book-and-claim model is not.