What’s the difference between net zero and carbon neutral?

A couple of months ago, we wrote about the UNFCCC’s Race To Zero campaign. But what exactly is net zero, carbon neutral, and even carbon negative?

These days it feels like carbon is vilified, but in itself it isn’t bad: you may remember the phrase from school that carbon is the ‘building block of life’.

‘Carbon’ is often used as shorthand not only for carbon dioxide (CO2), but for all greenhouse gases (GHGs) — also referred to as CO2e, or carbon dioxide equivalent. Each of the various greenhouse gases like water vapour, methane, nitrous oxide, and CFCs (chlorofluorocarbons) behaves differently. For example, methane is more potent than CO2 but it stays in the atmosphere for tens of years rather than hundreds.

So usually when you see ‘carbon’, think more broadly of all the greenhouse gases.

Even the greenhouse effect itself isn’t bad: it keeps our planet at temperatures amenable to life. But the emissions caused since the Industrial Revolution have amplified the greenhouse effect to the point of causing a climate crisis which is already having devastating effects. Even the Earth’s axis has shifted.

In order to keep within a rise of maximum 1.5°C above pre-industrial levels, we need to take immediate and drastic action, with global emissions reaching net zero by 2050. There has recently been an acceleration of pledges, including the UK’s commitment to net zero by 2050: the first major economy to pass a net zero emissions law.

To answer the original question — what is net zero, and what is carbon neutral — we need to look briefly at scope 1, 2, and 3 emissions.

As explained on the edie website:

Scope 1 greenhouse gas emissions are the emissions released into the atmosphere as a direct result of an activity, or series of activities, carried out by a business. These are often referred to as direct emissions such as heating an office or transporting goods by [a company-owned] vehicle to a customer.

Scope 2 is the energy your business purchases, in other words, the emissions created in the production of energy that is eventually used by the company. This can be zero if you are purchasing 100% renewable energy.

Scope 3 covers a much wider remit and includes transportation and distribution, waste generated, leased assets, business travel, employee commuting and purchased goods and services through the supply chain, water consumption, and IT equipment and services. It covers all your indirect emissions.

Carbon neutrality covers only scopes 1 and 2. If a business offsets its scope 1 emissions and uses 100% renewable energy (covering scope 2), then they are considered to be carbon neutral. Carbon neutrality does not consider scope 3 at all.

Net zero, on the other hand, covers all three scopes, and focuses on having zero scope 1 and 2 emissions, with reduction of scope 3 as well. There is a focus on carbon removal and carbon capture, with offsetting used only for residual emissions. Net zero is more ambitious and requires a robust strategy to achieve it.

This explanation has wide consensus, with net zero standards being developed by the Science Based Targets initiative. However it must be said that not all sources agree on these definitions, with one BBC article for example setting out that the only difference between carbon neutral and net zero is that carbon neutral refers to carbon dioxide only whereas net zero includes all greenhouse gases.

Microsoft has pledged to be carbon negative — removing more CO2 from the atmosphere than it emits — by 2030, and by 2050 to remove all of the CO2 it has emitted since its founding in 1975.

Look out for a future Thought on carbon capture, and why offsetting is not a complete or long-term solution, and the problems it can cause.

If you would like help creating a net zero strategy for your business, ring us on +44 20 8187 7040 or email madelyn@grain-sustainability.com.

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