As advisors supporting companies in their decarbonization processes, we have prepared an overview of the most important changes introduced by the new guidelines. We have also analyzed their practical implications for companies planning to set and submit science-based decarbonization targets. It should be noted that an extensive package of supporting documentation was published alongside the standard, and the detailed interpretation of individual criteria will evolve as the validation process begins under the new rules. Nevertheless, the key directions of change are already known.
When will the updated standard take effect?
- From February 1, 2027, it will be possible to submit and validate targets in accordance with the Corporate Net-Zero Standard V2.0.
- Until January 31, 2028, companies will still be able to submit targets according to the previous version of the standard (V1.3.1).
- From February 1, 2028, the V2.0 standard will become mandatory for all new decarbonization target submissions.
What will the target time horizons be?
One of the most significant changes is the standardization of the time horizon for near-term targets (near-term targets). Near-term targets will have to cover exactly a 5-year period from the moment the target is submitted for validationThe previous version of the standard allowed for a period of between 5 and 10 years.
Standard V2.0 also introduces a continuous target update model based on 5-year cycles. For each new period, the company will be required to use the most recent base year (most recent year) for which it has complete emissions data. This approach is intended to ensure that targets are regularly updated and reflect the company's current business structure.
For long-termNet-Zero targets, the rules remain largely unchanged – companies must still define a pathway to reach residual emissions (residual emissions) no later than 2050.
Will the distinction between large companies (Corporate) and SMEs (SME pathway) be maintained?
Standard V2.0 moves away from the previous "Corporate" and "SME" distinction and introduces a new company classification: Category A and Category B.
By Category A (equivalent to the current Corporatepath) will include companies headquartered in a country classified by the World Bank as a high-income economy (Poland is in this group) that meet at least one of the following conditions:
- Scope 1 and 2 emissions ≥ 10,000 tCO₂e, or
- meeting at least two of the following three financial and organizational criteria:
- total assets ≥ EUR 25 million,
- net turnover ≥ EUR 50 million
- headcount ≥ 250 employees (FTE).
Additionally, regardless of the country's income level, Category A will include companies that meet one of the following conditions:
- net turnover ≥ EUR 450 million,
- headcount ≥ 1,000 employees (FTE).
This clearly reflects the thresholds for non-financial reporting set by the European Commission under the Omnibus directive. Companies assigned to Category B (formerly SME) will be eligible for simplified requirements. Specifically, they will only be required to set short-term targets for Scope 1 and 2, while Scope 3 and long-term targets will remain optional.
From ambition to action – mandatory decarbonization strategy
One of the most significant changes in the V2.0 standard is the requirement for all companies – both Category A and B – to prepare a climate transition plan ( transition plan). This document must outline how the company intends to achieve its science-based targets and identify key actions for emission reduction. The transition plan will be subject to verification during the target validation process.
Category A companies will be additionally required to publicly disclose their transition plan within 15 months of target validation, unless local regulations require earlier publication. This is intended to curb greenhushing, a situation where businesses choose to remain silent about their actions for fear of being accused of greenwashing. It should be noted, however, that SBTi will not assess the business quality, financial feasibility, or completeness of the strategy. Verification will focus primarily on the presence of the document and its compliance with the required elements.
Our services in the field of joining SBTi (Science Based Targets initiative)
We will help your company to go through the process of validating commitments under the SBTi. We provide professional support at every stage of the procedure.
Target-setting methodologies
The V2.0 standard introduces a more diverse set of target-setting methods, tailored to the specific nature of business operations. The principle remains that companies submitting their targets to SBTi should follow the most current version of the GHG Protocol standards and guidance (GHG Protocol Standards and Guidance). Work is currently underway on a new version of the standard, which will be published at a later date. A significant change is the separation of targets for Scope 1 and Scope 2. Unlike the current version of the standard, V2.0 introduces a requirement to set separate targets for each emission scope.
Scope 1
The target must cover 100% of Scope 1 emissions. Companies will be able to use one of three methods:
- absolute emission reduction – based on a linear reduction trajectory,
- emission intensity reduction (Sectoral Decarbonization Approach) – available for selected sectors (e.g., steel, cement, chemical production, or aviation and maritime operations),
- Asset Decarbonization Plan (ADP – Asset Decarbonization Plan) – a new method aimed primarily at capital-intensive industries, enabling reduction planning based on the lifecycle of specific assets (e.g., the phase-out schedule for high-emission installations).
Scope 2
The target must also cover 100% of Scope 2 emissions. Available methods include:
- linear reduction of absolute emissions,
- targets assuming an increase in the share of utilized or contracted low-carbon energy (Low-carbon electricity, LCE Alignment).
Scope 3
The approach to Scope 3 will become more modular. The reduction target will have to cover all relevant emission categories, i.e., those that account for more than 5% of total Scope 3 emissions. This rule will apply to each category separately. Available approaches include:
- a general absolute emission reduction target,
- supplier and customer engagement (Overarching Alignment) – increasing the share of business partners that have their own science-based targets,
- sector-specific methods dedicated to particular emission categories.
Changes in Scope 2 decarbonization
The biggest change in Scope 2 is moving away from the market-based method as the basis for setting targets. In the V2.0 standard, targets are to be modeled based on the location-based method, which reflects the actual emissions associated with energy drawn from the power systems that the company physically uses. The purpose of this change is to limit situations where emission reductions are achieved solely through the purchase of market instruments (e.g., guarantees of origin) without any real change in how energy is used.
Scope 2 decarbonization will be based on a mitigation hierarchy. Priority will be given to actions leading to physical emission reductions, such as:
- improving energy efficiency,
- reducing energy consumption,
- investments in behind-the-meter energy generation (behind-the-meter), e.g., on-site renewable energy installations.
Market-based instruments, such as Guarantees of Origin (GOs) or Power Purchase Agreements (PPAs), will remain part of the decarbonization strategy, but their impact will be reported separately as supporting measures. They do not change the physical emissions intensity of the energy system under a location-basedapproach.
For renewable energy to be recognized as a contribution to the target, it must meet specific criteria, including the geographical delivery requirement – energy must originate from the same energy region where it is consumed. The standard also places greater emphasis on hourly matching(hourly matching)
, which is intended to better reflect the actual availability of clean energy in the power system. Large enterprises consuming over 10 GWh of energy annually in a given energy system will be required to report the hourly matching level of their consumption with low-emission energy generation.
Target-setting tool
In the V2.0 standard, the target-setting process will be supported by an integrated tool CNZS V2.0 Target Calculation Tool. A beta version of the tool is currently available, but it cannot yet be used for formal target setting or validation. The results are for informational purposes only. Ultimately, the tool will allow for:
- entering baseline data,
- selecting a methodology,
- automatically calculating required reduction trajectories.
When submitting targets for validation, companies will be required to attach the file generated by the tool, confirming that minimum climate ambition requirements have been met.
Summary
The new version of the Corporate Net-Zero Standard marks a significant shift in the approach to setting decarbonization targets. The process will become comprehensive and, consequently, more demanding. In addition to accurately calculating the carbon footprint and methodological compliance, companies will also need to present an implementation plan for their objectives. The introduction of five-year target update cycles, mandatory transition plans, and a greater emphasis on physical emission reductions means that SBTi targets will be even more closely linked to the actual transformation of business models. As a result, the status of validated science-based targets will provide an even more credible confirmation of a company's strategic approach to greenhouse gas emission reduction and climate transition.
