This research project represents a collaborative effort between E&C Consultants, an international energy procurement consultancy, and aims to address the increasing demand for guidance on scope 1 emissions reduction strategies expressed by their clients. From a procurement perspective, companies are actively seeking alternative commodities, such as biomethane or hydrogen, to substitute their natural gas consumption. In response to this growing trend, multinational corporations are displaying an increased interest in voluntary emission reduction initiatives, including the Science Based Targets initiative and the Greenhouse Gas Protocol. Subsequently, the research project encompasses an investigation into the sustainability plans adopted by companies. Furthermore, an analysis of the European biomethane and hydrogen markets is made. Most of the information is derived from interviews conducted with diverse stakeholders, including multinational companies, energy traders, an energy supplier, a gas market expert, and a carbon removal expert. The findings of this research project indicate that multinational corporations have established robust short-term sustainability plans, yet encounter challenges in formulating long-term strategies, primarily due to legislative ambiguities and limited resources and expertise. The implementation of REPowerEU [1] is expected to significantly augment the production levels of both biomethane and hydrogen by 2030. The biomethane market is predominantly characterised by supply constraints, owing to the high demand it experiences, resulting in elevated prices. Conversely, the hydrogen market is less mature and exhibits comparatively lower demand as companies have to implement alternative technologies that are required for hydrogen adoption. Eventually, both biomethane and hydrogen possess the potential to emerge as cost-competitive alternatives to natural gas, depending upon the maturation and development of their respective markets. / Detta forskningsprojekt representerar ett samarbete mellan E&C Consultants, en internationell energiupphandling, och syftar till att möta den ökande efterfrågan på vägledning om scope 1-strategier för minskning av utsläppen uttryckt av deras kunder. Ur ett upphandlingsperspektiv söker företag aktivt alternativa råvaror, såsom biometan eller väte, för att ersätta deras naturgas konsumtion. Som svar på denna växande trend visar multinationella företag ett ökat intresse för frivilliga initiativ för att minska utsläppen, inklusive initiativet Science Based Targets och Greenhouse Gas Protocol. Därtill omfattar forskningsprojektet en utredning av antagna hållbarhetsplaner av företag. Dessutom görs en analys av den europeiska biometan- och vätemarknaderna. Merparten av informationen kommer från intervjuer med olika intressenter, inklusive multinationella företag, energimäklare, en energileverantör, en gasmarknadsexpert och en expert på koldioxidinfångning. Av denna studie indikerar att multinationella företag har etablerat robusta kortsiktiga hållbarhetsplaner, men stöter på utmaningar i att formulera långsiktiga strategier, främst på grund av oklarheter i lagstiftningen och begränsade resurser och expertis. Implementeringen av REPowerEU [1] förväntas avsevärt förstärka produktionsnivåer av både biometan och väte till 2030. Biometanmarknaden kännetecknas övervägande av utbudsbegränsningar på grund av den höga efterfrågan, vilket resulterar i förhöjda priser. Omvänt är vätgasmarknaden mindre mogen och uppvisar jämförelsevis lägre efterfrågan eftersom företag måste implementera alternativa tekniker som krävs för att använda väte. Så småningom kan båda biometan och väte ha potential att vara konkurrenskraftiga alternativ till naturgas, beroende på deras mognad och utveckling de respektive marknaderna.

The emissions of greenhouse gases need to be cut by 45% between 2010 and 2030 and reach net-zero by around 2050 (IPCC, 2018) to limit global temperature-rise to 1,5 degrees C. More companies are committing to net-zero emissions, but the overall emissions of greenhouse gases in the world are still going up, and previous research shows that there is an implementation gap and lack of plans in companies. This thesis examines the hindering and supporting factors for companies’ net-zero transition. It is also exploring how SBTi, sustainability reporting, and sustainability ratings influence the net-zero transition in companies according to sustainability practitioners. The key findings are that companies alone cannot do the net-zero transition; they are dependent on other stakeholders and factors such as investors, customers and suppliers. Investors and customers are strong drivers for some companies to make the transition to netzero, but they are also the strongest hindering factors not wanting to pay extra or sacrifice dividends for the transition in companies’ value chains. Companies are also dependent on their suppliers and customers to measure and cut their value chain scope 3 emissions. To reach net-zero, new ways of collaboration are needed across the value chain. Internally, the implementation has not started properly in many companies. The key hindering factor internally is money, the investments needed will impact the profits, and often bonuses of managers, and GHG emission reductions need to be valued on the same level as money. Investors and financial actors play a large role pushing companies to set net-zero targets through SBTi. SBTi is a key framework to make companies cut emissions in line with science, but its control mechanisms are weak. If the control mechanisms are strengthened through audits, accountability and litigation, SBTi has the potential to be a very strong supporting factor for companies’ net-zero transition. Sustainability reports and ratings are the way companies communicate their net-zero performance with their stakeholders, but the reports are a polished truth, and it is difficult to understand the net-zero performance in companies. Ratings such as CDP do not reward emission reductions enough, instead they reward processes and documents which can make the companies look greener than they are.

The requirements on companies' sustainability work are growing due to the increased awareness of greenwashing which has led to an interest in creating sustainability goals that are “science based”. Therefore, this study investigates the possibilities for a company to get verified Science Based Targets (SBTs) through the Science Based Targets initiative (SBTi). By using a qualitative approach with empirical data gathered from a case study of a Small and Medium-sized Enterprise (SME), this paper further provides how such a sustainability change can be managed by adapting company operations and activities. The results show that the requirements for getting verified SBTs differ depending on certain conditions of the applicant company, where SMEs can utilize a simpler and more stripped-down alternative. However, for all companies it is mandatory to do an inventory of their Greenhouse Gas (GHG) emissions and annually report the progress towards the targets. The study further presents some contradictory aspects regarding the credibility of the initiative. It is argued to improve a company's trustworthiness against external stakeholders but at the same time it can be questioned how thoroughly the initiative checks the reporting of emissions. Moreover, the SBTi acts as a driving force for sustainability changes but it can also create misleading pictures of companies and their progress against the targets. Regarding how to adapt a company's operations and activities and manage a sustainability change to reach the targets, the results show that it depends on three factors. These are the size of the company, the level of sustainability integrated in the culture and the company's view of the entire value chain. For SMEs it is presented to be favorable to include collaborations with bigger actors in the industry and learn from these. It is also shown that, regardless of the size, it is beneficial to have a well-integrated sustainability culture and to strive for incremental changes that include the entire company. Above all, the activities in the value chain are proven to be an important aspect to prioritize. Finally, the paper provides some recommendations for further research, both regarding the development of the SBTi and also regarding the theory of change management in relation to sustainability changes.