Fossil fuel equivalence ratio discussion paper - Grantham Research Institute on climate change and the environment<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.lse.ac.uk\/granthaminstitute\/publication\/fossil-fuel-equivalence-ratio-discussion-paper\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fossil fuel equivalence ratio discussion paper - Grantham Research Institute on climate change and the environment\" \/>\n<meta property=\"og:description\" content=\"This\u00a0discussion paper\u00a0aims to enhance stakeholders\u2019 understanding of oil and gas companies\u2019 decarbonisation commitments and support investors in their engagement efforts.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.lse.ac.uk\/granthaminstitute\/publication\/fossil-fuel-equivalence-ratio-discussion-paper\/\" \/>\n<meta property=\"og:site_name\" content=\"Grantham Research Institute on climate change and the environment\" \/>\n<meta property=\"article:modified_time\" content=\"2025-05-07T13:37:15+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.lse.ac.uk\/granthaminstitute\/wp-content\/uploads\/2025\/04\/TPI_discussion_paper.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"600\" \/>\n\t<meta property=\"og:image:height\" content=\"400\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Estimated reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.lse.ac.uk\\\/granthaminstitute\\\/publication\\\/fossil-fuel-equivalence-ratio-discussion-paper\\\/\",\"url\":\"https:\\\/\\\/www.lse.ac.uk\\\/granthaminstitute\\\/publication\\\/fossil-fuel-equivalence-ratio-discussion-paper\\\/\",\"name\":\"Fossil fuel equivalence ratio discussion paper - 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{"id":78324,"date":"2025-04-25T19:41:30","date_gmt":"2025-04-25T18:41:30","guid":{"rendered":"https:\/\/www.lse.ac.uk\/granthaminstitute\/?post_type=publication&p=78324"},"modified":"2025-05-07T14:37:15","modified_gmt":"2025-05-07T13:37:15","slug":"fossil-fuel-equivalence-ratio-discussion-paper","status":"publish","type":"publication","link":"https:\/\/www.lse.ac.uk\/granthaminstitute\/publication\/fossil-fuel-equivalence-ratio-discussion-paper\/","title":{"rendered":"Fossil fuel equivalence ratio discussion paper"},"content":{"rendered":"\n

As oil and gas companies face increasing scrutiny of their climate strategies, understanding the methodologies behind their emissions targets is essential. Scope 3 Category 11 emissions from the combustion of sold products represent the majority of the sector’s climate impact. In recent years, more companies have started including these emissions in their reduction targets, frequently setting carbon-intensity targets based on the energy they sell. An often-used yet underexplored element in these calculations are Fossil Fuel Equivalence (FFE) ratios.<\/p>\n\n\n\n

FFE ratios convert renewable electricity into hypothetical fossil-based primary energy equivalents. This method inflates the energy denominator in intensity calculations, resulting in steeper reported reductions in emissions intensity, despite no change in absolute emissions or actual energy sold. While intended to allow for comparability between renewables and fossil fuels, the use of FFE can obscure the true decarbonisation progress of companies.<\/p>\n\n\n\n

This discussion paper <\/strong>aims to enhance stakeholders’ understanding of oil and gas companies’ decarbonisation commitments and support investors in their engagement efforts. It demystifies the concept of FFE ratios and analyses whether and how it is applied by 15 oil and gas companies with Scope 3 targets. Based on this analysis, the authors at the Transition Pathway Initiative Centre (TPI Centre) at the London School of Economics and Political Science (LSE) put forward recommendations for investors.<\/p>\n\n\n\n

The discussion paper

We thank Dan Gardiner, Institutional Investors Group on Climate Change (IIGCC), for reviewing the paper.<\/p>\n\n\n\n

For the TPI Centre’s latest NZS assessments and relevant resources on the oil and gas sector, click here

You can also access additional Management Quality and Carbon Performance data for the oil and gas sector, by filtering by sector or company: https:\/\/www.transitionpathwayinitiative.org\/corporates

Finally, we welcome your feedback. Please let us know if you have any questions or suggestions. Email here<\/a>.<\/p>\n\n","protected":false},"excerpt":{"rendered":"\n