Decarbonized electricity: how the GHG Protocol is raising the bar

Until now, companies could claim low- or zero-emission electricity largely through contractual instruments like the Renewable Energy certificates (RECs) or Guarantees of Origins (GO). These traditional renewable procurement models have been essential in scaling up wind and solar and remain a critical part of the toolbox for the energy transition. But on their own, they don’t guarantee that carbon-free electricity (CFE) is available every hour of the day GHG Protocol therefore launched a consultation in which ENGIE participated.

What’s changing: the end of annual matching

The proposed changes aim to bring climate accounting closer to physical reality of energy systems. Climate targets demand not only more renewable electricity, but greater alignment between when and where clean electricity is actually produced and consumed.

The proposed update of the GHG Protocol introduces two major shifts:

• First: hourly matching. To declare electricity as carbon-free, companies would need to demonstrate that renewable electricity is generated in the same hour as it is consumed. Put simply, it is no longer enough to match annual consumption with annual renewable production.
• Second: geographic matching. Companies would need to show that electricity is produced and consumed in the same market zone. While definitions vary across the world, the principle is straightforward: renewable electricity claims should reflect local grid realities.

ENGIE’s position: ambitious, but realistic pathway

ENGIE supports the direction of travel set out by the GHG Protocol. For ENGIE, higher standards are essential to reinforce trust, provided they remain feasible, fair and grounded in real world market conditions.

A progressive move to hourly matching from a voluntary leadership approach toward a future compliance standard.

At ENGIE, we believe that hourly matching will bring:

• More credible climate claims, grounded in physical reality
• Greater comparability between companies
• Higher confidence for investors and regulators

ENGIE also emphasizes the importance of competitiveness, resilience and public trust; all critical to ensuring that this transition strengthens, rather than destabilizes, the energy system. This is why ENGIE also promotes:

• exemption mechanisms for smaller organization,
• a legacy clause to protect existing renewable investments,
• and a phased implementation (both over time and sectors) to kick-in after 2030.

Hence, we recommend that mandatory implementation focuses on large BtoB consumers, allowing advanced players to act as frontrunners.

Clear and realistic market boundaries

At ENGIE, we support clear market boundaries for geographic matching.

• A country-level minimum boundary (as opposed to market zone), reflecting how most power markets are organized
• Accounting for physical realities, such as isolated or purely insular systems
• Recognizing highly integrated markets, such as the European Union and the European Economic Area, as valid market zones to enhance efficiency and reliability

This balanced approach aims to ensure robust accounting without fragmenting markets or slowing renewable development.

Beyond its contribution to the GHG Protocol consultation, ENGIE is actively preparing for what comes next. As a power consumer, the Group is assessing where pilot projects could test hourly matching for carbon-free power sourcing in relevant geographies.

So what is ENGIE actually doing?

As an energy partner, ENGIE is already developing solutions aligned with the 24/7 CFE approach, designed to help clients navigate increasing requirements while continuing to decarbonize at pace.
ENGIE’s objective is clear: support clients through the transition, combining ambition with operational realism.