MB Emissions - Certificate Allocation Methodology

This page will discuss the method used to apply unbundled certificates across the electricity consumption of an organization.

Compliance & Jurisdiction

Certificates allocated against this category are the result of grid consumption multiplied by the renewable power percentage for the region and month. This renewable power percentage is managed by Envizi at a monthly level and is updated as required.

Green Power

Green power, or bundled certificates, are certificates that are obtained by the organization through the purchase of renewable power through an electricity retailer. The organization doesn’t take formal ownership of the certificates purchased but can make claims to the certificates in market-based reporting.

This category of certificates requires that green power is captured in the same account as regular ‘black’ grid electricity. Read this article for more information on how RECs are captured and handled in Envizi.

Unbundled certificate allocation

Unbundled certificates are a useful tool when looking to reduce Scope 2 market-based emissions. The difficulty is understanding how these certificates can be applied to electricity consumption to achieve the emissions credit.

Envizi has provided a methodology to allow organizations to capture and allocate unbundled (voluntary) certificates to grid electricity consumption without requiring the organization to allocate certificates on an account-by-account basis.

Note that when configuring and capturing unbundled certificates, these accounts must be configured at locations that also have at least some electricity consumption for the reporting period. Creating a new location for the sole purpose of capturing certificates will not include the certificates in the report.

There are 7 data types available for unbundled certificate allocation and certificates are applied and apportioned in the following order:

• Certificates - Location

• Certificates - Level 3 Group

• Certificates - Level 2 Group

• Certificates - Level 1 Group

• Certificates - State

• Certificates - Country

• Certificates - Organization

By default the classification grouping structure is used for certificate allocation as there it is likely that all locations are included in the grouping structure. If a portfolio group is preferred please get in touch with the Help Desk to organize the change.

Methodology

For each level of allocation the method determines the subtotal of remaining kWh (consumption that is not covered by certificates) for each month of data. The method then prorates certificates captured in the data type against the subtotal. This is seen in the columns beginning with ‘Certificates - …’ . Then prorated monthly certificate values are subtracted to arrive at the next subtotal.

For example, an organization may wish to purchase 10,000 kWh of unbundled certificates and apply those certificates to a Level 3 Group that has 2 locations. The total consumption across both locations is 45,708 kWh for the 3-month reporting period (reporting periods are normally 12 months, but 3 months was selected for simplicity).

The remaining uncovered kWh is 35,708, but each month of consumption was allocated a prorated amount of the total 10,000 kWh certificates. This same processes is repeated for each level of apportionment.

Negative values

This report is able to apportion certificates across periods that contain negative consumption values. Organizations may have situations where accounts are added to true-up consumption by adding negative kWh consumption values for a site. In this instance the methodology will prorate and allocate certificates to those months of negative consumption. This does cause incorrect monthly values in the Certificates column to appear when drilling down to a monthly level, but the summary rows show the correct values as the negative and positive values will sum to the correct amounts.

To make this possible there is special handing for rows that contain negative consumption in the Subtotal - Location kWh to remove the negative consumption for the purposes of certificate apportionment. The rows with negative values in the Subtotal - Location kWh column are set to zero and the rows with positive values are shown prorated based on distributing the negative sum proportionally. See the following example to illustrate:

Note on locations with total consumption less than zero

Note that the Subtotal - Location kWh column will show zero for locations that report a total negative amount for the reporting period. This is because summary rows above location apportionment will show misleading totals if the method were to allow for this.

If the organization’s data set contain any location where total consumption across all accounts is negative, an error icon will appear. This does not invalidate the values in the report, provided the site can be logically be excluded from reporting.