Companies Face High Costs to Achieve SBTi Leadership Status
Starting in 2024, companies can secure recognition from the Science Based Targets initiative (SBTi) for managing emissions. Achieving Leadership status requires a substantial carbon price of at least $80/tCO2e on all emissions, potentially costing billions for heavy emitters.
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Beginning in 2024, the SBTi will offer recognition tiers for companies taking responsibility for emissions, marking a significant shift from prior focus solely on target setting. To attain Leadership status, companies must implement an internal carbon price of a minimum of $80/tCO2e covering 100% of emissions, with funds used for carbon credits.
The cost analysis by Trellis indicates that major emitters could face exorbitant expenses, potentially exceeding their recent profits. Companies like Microsoft and others with higher internal carbon prices are closer to meeting requirements, yet most still fall short of full compliance and must reevaluate their strategies. The implications of these requirements could lead companies to prioritize investments in external climate solutions over internal emissions reductions.
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