GHG Protocol Scope 2 Revision: Where It Stands for Japan

A Japanese manufacturer buys non-fossil certificates, 非化石証書, and brings the emissions from its purchased electricity close to zero. From the fiscal year ending March 2027 that figure stops being a line in a voluntary ESG report and becomes part of a securities filing under SSBJ.

Those March 2027 filings still use the 2004 GHG Protocol Corporate Standard. The replacement is unfinished.

What SSBJ actually asks for in Scope 2

IFRS S2 paragraph 29(a)(ii) requires an entity to measure its emissions in accordance with the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard of 2004, unless it is required by a jurisdictional authority or an exchange to use a different method (IFRS S2). Paragraph 29(a)(v) then says what Scope 2 specifically has to show: the location-based figure, plus information about any contractual instruments a user needs in order to understand it.

The SSBJ issued its three standards on 5 March 2025, and the climate standard is Japan’s counterpart to IFRS S2. Disclosure becomes mandatory for Prime-listed companies above ¥3 trillion market capitalisation for the fiscal year ending March 2027, above ¥1 trillion from 2028, and above ¥500 billion from 2029 (our SSBJ roadmap).

Read together, those two paragraphs put the certificate-backed number in a different place than many Japanese teams expect. The figure that must appear is the location-based one, calculated on grid factors. The certificates are disclosed as contractual instruments alongside it.

Domestic practice trains the opposite instinct. Under the SHK reporting system of the Act on Promotion of Global Warming Countermeasures, the Ministry of the Environment and METI publish per-retailer emission factors, including the 調整後排出係数, the adjusted factor that reflects non-fossil certificates. The 2024 fiscal year factors were published on 9 January 2026 (Ministry of the Environment). A team used to reporting the adjusted number to the ministry will reach for it again, and under SSBJ that is the supporting disclosure rather than the headline.

The revision that was going to change all of this

On 14 July 2025 the GHG Protocol’s Independent Standards Board voted to approve revisions to both the location-based and the market-based methods for public consultation, by ten votes to one in each case (GHG Protocol).

The market-based proposals are the ones that reach Japan. Certificates used to support a clean energy claim would have to be matched to consumption hourly, and would have to come from grid regions that can actually deliver power to the point of consumption. Electricity supplied under a mandated or publicly funded programme would be claimable only up to a pro-rata share. Alongside those, the GHG Protocol set out feasibility measures: exemption thresholds based on consumption volume in a grid region or on company size, approximation methods for organisations without hourly data, and a legacy contract clause still under evaluation (GHG Protocol).

That same page put publication of the revised Scope 2 Standard at some point in late 2027, with implementation phased over several years.

Where the revision has actually got to

On 29 July 2026 the GHG Protocol published the results of the Scope 2 consultation and a larger structural decision alongside them.

The consultation drew nearly 1,100 responses from 56 countries. The GHG Protocol describes the feedback as surfacing “a range of opinions on how companies should account for renewable energy purchases”, with broad support for improving accuracy and comparability. Rather than finalising a text, it says multiple reporting approaches are now being explored, and that any further proposals go back through the Technical Working Group and the Independent Standards Board (GHG Protocol).

The GHG Protocol and ISO will combine their corporate carbon accounting standards. The new standard will bring the three scopes and the Actions and Market Instruments work together with ISO 14064-1. Its public consultation is planned for the second quarter of 2027.

So there is no finalised revised Scope 2 text, and the next public consultation is on a bigger document than the one that was consulted on. For a Japanese filer the practical consequence is short. The first mandatory SSBJ year is measured under the 2004 Corporate Standard as it stands, and so is the first post-Omnibus CSRD year.

Why the proposals still matter to a company holding 非化石証書

The Japanese certificate market was created to solve a domestic problem. Retailers are obliged under the Sophisticated Methods of Energy Supply Structures Act to reach a non-fossil power ratio of 44 percent by fiscal 2030, and the non-fossil value trading market opened with its first auction in May 2018 to let them buy that value separately from the electricity (Agency for Natural Resources and Energy).

It has since split into two. The 再エネ価値取引市場 trades FIT certificates and the 高度化法義務達成市場 trades non-FIT certificates for retailers meeting their statutory obligation (Agency for Natural Resources and Energy). Corporate buyers were admitted to the renewable value market in fiscal 2021, directly or through an intermediary, and the first auction under that design in November 2021 cleared about 1.9 billion kWh (Kankyo Business).

Auctions settle against a generation quarter. A certificate carries a volume and a period. It does not carry an hour.

The Renewable Energy Institute’s reading of the draft proposals is that this is the binding constraint for Japan: hourly matching would require a substantial redesign of the certificate scheme, since certificates today have no hourly data attached. The same analysis notes that Japan is better equipped than it looks, because retailers already provide 30-minute consumption data and grid operators publish the generation mix at 30-minute intervals. On deliverability, it reads the proposal as narrowing claims from a national average to the ten transmission and distribution areas. And on FIT electricity, which is funded by the levy every customer pays, it reads the standard supply service treatment as limiting a company to its average share (Renewable Energy Institute).

That is one institute’s reading of a draft that has since gone back for redevelopment. Treat it as a description of the direction, not of a rule.

March 2027 comes first

Mandatory SSBJ disclosure starts for the fiscal year ending March 2027. Third-party assurance starts the year after. CSRD’s first post-Omnibus reports cover financial years beginning on or after 1 January 2027 and are published in 2028. A Japanese group with European subsidiaries will then run both rulebooks at once.

The revised measurement rules arrive later than all of that, and phased. A company that rebuilds its electricity accounting now, against a draft that is being reworked, will rebuild it again.

What to build anyway

Start with the location-based figure required by IFRS S2 paragraph 29(a)(v). Japanese companies can calculate it from published retailer factors.

Keep the half-hourly consumption records that retailers already provide. A company that starts in 2026 will have a usable history if hourly matching becomes mandatory.

Keep each certificate with its power station and period. An assurance provider can then test which consumption it covered.

Write the contractual-instruments note for a verifier, not a marketing claim. Scope 1 and 2 are inside the first two years of SSBJ assurance. The related reporting-boundary question needs its own decision.

Scope 3 carries the larger data problem under CSRD and SSBJ’s one-year relief. Scope 2 uses the current rule for now. Keep enough data to recalculate it after the revision.

Check where you stand. The free SSBJ readiness check takes about three minutes and scores the dimensions an assurance provider will actually test: socious.io/ssbj-check.

Socious Report takes one dataset into AI-drafted CSRD, SSBJ and ISSB reports, then adds an independent Socious Verify credential.