Base Year GHG Emissions

Definition

Base Year GHG Emissions are the emissions of a base year that companies choose as their reporting baseline under the GHG Protocol.

This is a year for which verifiable emissions data are available and companies must specify their reasons for choosing that particular year.

Most companies select a single year as their base year. However, it is also possible to choose an average of annual emissions over several consecutive years. For example, the U.K. ETS specifies an average of 1998–2000 emissions as the reference point for tracking reductions. A multi-year average may help smooth out unusual fluctuations in GHG Emissions that would make a single year’s data unrepresentative of the company’s typical emissions profile.

The inventory base year can also be used as a basis for setting and tracking progress towards a GHG Emissions Target in which case it is referred to as a target base year.

Recalculation

Companies shall develop a base year emissions recalculation policy, and clearly articulate the basis and context for any recalculations. If applicable, the policy shall state any “significance threshold” applied for deciding on historic emissions recalculation. “Significance threshold” is a qualitative and/or quantitative criterion used to define any significant change to the data, inventory boundary, methods, or any other relevant factors. It is the responsibility of the company to determine the “significance threshold” that triggers base year emissions recalculation and to disclose it. It is the responsibility of the verifier to confirm the company’s adherence to its threshold policy. The following cases shall trigger recalculation of base year emissions:

• Structural changes in the reporting organization that have a significant impact on the company’s base year emissions. A structural change involves the transfer of ownership or control of emissions-generating activities or operations from one company to another. While a single structural change might not have a significant impact on the base year emissions, the cumulative effect of a number of minor structural changes can result in a significant impact. Structural changes include:
  • Mergers, acquisitions, and divestments
  • Outsourcing and insourcing of emitting activities
• Changes in calculation methodology or improvements in the accuracy of emission factors or activity data that result in a significant impact on the base year emissions data
• Discovery of significant errors, or a number of cumulative errors, that are collectively significant.

In summary, base year emissions shall be retroactively recalculated to reflect changes in the company that would otherwise compromise the consistency and relevance of the reported GHG emissions information. Once a company has determined its policy on how it will recalculate base year emissions, it shall apply this policy in a consistent manner. For example, it shall recalculate for both GHG emissions increases and decreases.