The Market Based Measures Accounting Framework explains how to apply a market based accounting approach to the quantification and reporting of transportation greenhouse gas emissions.
Why market based accounting?
High costs for freight emission reduction technologies and large, complex, and dynamic freight transportation supply chains can make heavy freight transportation emissions particularly hard to abate. There is significant demand for a framework to overcome these barriers.
As such, in the fall of 2021, SFC partnered with World Economic Forum and a series of leading multinationals in a project to develop a voluntary market based measures accounting framework to accelerate the uptake of low emission transportation solutions and services.
What does the market based measures accounting framework do?
The accounting framework, released in June of 2023, outlines a way for shippers, logistics service providers, freight carriers, and freight decarbonization solution providers to effectively partner with each other to deploy low emission transportation services. The accounting framework is based on a “book and claim” chain of custody approach that permits:
- A provider of freight transportation or of a freight decarbonization solution to allocate a low emission profile to the organizations that contribute to the emission abatement cost, even if those organizations’ freight is not always transported using a low emission solution or service.
- A purchaser of freight transportation to contribute to the cost premium of and report the greenhouse gas emission profile of a low emission transportation service, even if their freight was not physically transported on that low emission transportation service.
This framework builds on and supplements the fundamental transportation greenhouse gas emissions accounting principles described in SFC’s GLEC Framework.
How can I learn more about the framework?
Frequently Asked Questions
Yes. While these low emission transportation service emissions are “double counted” if they are included in both the shipper’s and LSP’s greenhouse gas emission inventory, not all double counting is erroneous.
For example, a shipper hires an LSP to secure transportation services to move the shipper’s freight. The shipper directs the LSP to secure a low emission transportation service for this freight. The LSP purchases the emission profile of a low emission transportation service from a carrier and allocates that emission profile to the shipper. The emissions associated with the transportation of the shipper’s freight are supply chain emissions for both the shipper and the LSP. The emission profile of the low emission transportation service purchased by the LSP is associated with the supply chain of both the LSP and the shipper, and can be reported accordingly.
The production date for SAF and similar low emission solutions is the date of issuance of the fuel’s Certificate of Analysis (CoA), Certificate of Quality (CoQ), or Refinery Certificate of Quality (RCQ). The solution provider may select the CoA date, CoQ date, or RCQ date as the production date, at their discretion.
No. An organization can apply the emission profile of a low emission fuel or low emission transport service to that organization’s emission footprint, to the extent that this fuel or transportation service could have been used to conduct the organization’s actual transport activity (by mode) for the reporting period. An organization cannot apply the profile of more fuel or transportation service than the organization could have used in conducting transportation activity for that organization. If an organization is purchasing the profile of a fuel or transportation service that generates emissions (i.e., is not a zero emission fuel or service), that organization may not over-purchase the emission profile of the fuel or service to claim a net zero transportation footprint.
Yes. This framework may be applied globally. The principles and methods described in the framework are not bound to a specific region or country. The framework was prepared as a tool that could be used by organizations across their global transportation activities.
Greenhouse Gas Protocol and SBTi continue to assess how market based approaches to transport greenhouse gas emissions may be addressed in their accounting standards and target setting tools. Organizations interested in coordinating with each other in engaging with Greenhouse Gas Protocol and SBTi around market based accounting for transport emissions are encouraged to join work area one of the Book and Claim Community launched in 2023.
The accounting framework, as published in June 2023 on the SFC website, contained erroneous language regarding the vintage constraint. Those errors have been corrected and the revised accounting framework has been published on the SFC website. The corrected version of the framework reads “September 2023” in the lower right corner of the document’s cover page. If your copy of the framework does not read “September 2023” on the cover page, please discard the document and download the corrected version from the SFC website here.
The following images also provide examples of the vintage timelines for transportation supply chains. Find the examples here.