SBTI Corporate Net Zero Standard

NEP reaction · December 2025

SBTi’s revised Corporate Net-Zero Standard risks not delivering for permanent carbon removals and putting net-zero at risk

The Negative Emissions Platform (NEP) welcomes the publication of the updated draft of the SBTi’s revised Corporate Net-Zero Standard and fully supports SBTi’s objective to strengthen the credibility and scientific integrity of corporate climate targets.

The revised draft introduces important concepts, notably a framework to recognise companies that take early action to address their ongoing emissions with removals. However, as currently written, the draft standard stops short of providing the clear and timely demand signal that permanent carbon removal solutions urgently require. Without such a signal, the feasibility of achieving net zero itself is at risk. A multi-gigatonne permanent CDR infrastructure cannot be built overnight; it requires early, predictable, and durable demand to mobilise capital and enable project development.

This document summarises NEP’s reaction to SBTi’s updated draft standard and highlights the significant concerns for the permanent CDR sector and for companies seeking to follow credible, science-aligned net-zero trajectories.

Co-claiming restrictions put at risk the scale-up of permanent CDR

A central concern for NEP is the draft’s language on co-claiming, particularly paragraph C29.6, which would prevent individual carbon removals from being counted both toward corporate targets and toward Nationally Determined Contributions (NDCs). This restriction puts the emergence of a viable permanent CDR industry at serious risk.

Preventing co-claiming would undermine essential co-funding models in which public support mechanisms and private corporate demand are combined to enable projects to reach Final Investment Decisions. Many permanent CDR projects rely on blended finance structures, especially in their early stages, to manage high upfront capital costs and technology risk.

In addition, this restriction risks stifling corporate demand at precisely the moment when early market signals are most needed to scale durable CDR. It creates uncertainty for project developers, investors, and corporate buyers, weakening confidence in long-term revenue streams and slowing deployment.

The unintended consequence of prohibiting co-claiming may therefore be to delay or prevent the build-out of the very solutions required to meet both corporate net-zero commitments and national climate objectives. Such an outcome would run counter to the overarching goal of accelerating climate action. Given these implications, NEP strongly encourages SBTi to remove this phrasing in the final standard.

On this issue, NEP, along with 54 other organisations from across the CDR ecosystem, has also signed a joint letter, highlighting the importance of allowing permanent CDR projects to combine revenues from voluntary carbon markets and state support.

Durability requirements are not science-aligned and neglect the like-for-like approach

NEP is highly concerned by the draft’s proposed durability requirement at the net-zero target year. The illustrative guidance indicates that, at net zero, companies must neutralise 100% of their residual emissions across Scopes 1–3 with removals, of which at least 41% must be neutralised using permanent removals, while the remaining 59% may be neutralised using short-term removals.

Fixing the permanence requirement at 41% raises serious concerns about alignment with climate science. NEP strongly advocates for a science-aligned, like-for-like framework, whereby fossil emissions are neutralised with durable removals, a principle that is increasingly recognised across scientific and policy discussions. Allowing a majority of residual emissions to be neutralised with short-term removals at the net-zero target year risks undermining the environmental integrity of corporate net-zero claims.

We therefore call on SBTi to explicitly integrate the like-for-like principle into the final standard and ensure that durability requirements at net zero reflect the permanent or temporary nature of residual emissions rather than a fixed percentage that may not be science-aligned.

Mandate for Addressing Ongoing Emissions is Too Late

NEP welcomes the introduction of a framework that acknowledges corporate responsibility for ongoing emissions and the intention to make it mandatory for Category A companies to address these emissions with removals from 2035 onwards.

However, we are concerned that the proposed timeline is too late to support the necessary scale-up of permanent carbon removal. Under the current draft, addressing ongoing emissions with removals remains voluntary until 2035, at which point Category A companies would be required to offset a growing share of their ongoing emissions across Scopes 1–3 using removals (with the precise percentage yet to be defined). While this approach is a step in the right direction, it fails to incentivise near-term action on removals.

Scaling permanent CDR must begin now to achieve the levels required for global net zero. Without earlier and clearer demand signals, the sector will not scale at the pace required. NEP therefore urges SBTi to strengthen incentives for earlier action on removals and provide greater clarity to corporates on the role of permanent CDR along net-zero trajectories. Earlier expectations would significantly improve investment confidence and accelerate deployment.

The Voluntary Recognition Framework Risks Lowering Overall Ambition

The draft introduces a voluntary recognition framework for companies that take early action on ongoing emissions, with two tiers: “Recognised” and “Leadership.” While NEP supports the concept of rewarding early movers, we are concerned that the ambition gap between the two tiers is too wide. The Recognised tier appears highly accessible, while the Leadership tier requires a level of ambition that only a very small number of companies are likely to meet.

This imbalance risks leading most companies to settle for the lower tier rather than striving for leadership status, resulting in an overall lower level of ambition on removals. Consequently, demand for carbon removals is likely to fall far short of what is required to build a viable permanent CDR industry. Making the Leadership tier more attainable could help create a stronger incentive structure and encourage more companies to take earlier and more meaningful action on removals.

Conclusion

The draft standard, in its current form, risks severely constraining demand for permanent carbon removals, discouraging the investment needed for scale-up, and ultimately slowing the large-scale deployment of durable CDR solutions on which credible net-zero pathways depend.

Strengthening durability requirements at net zero, allowing pragmatic co-claiming arrangements, accelerating demand signals for removals, and strengthening incentives for early action are all essential to ensuring that corporate net-zero targets remain credible and achievable.

NEP stands ready to continue engaging constructively with SBTi and other stakeholders to ensure the final standard supports both climate integrity and the rapid scale-up of permanent carbon removal solutions.

About NEP

The Negative Emissions Platform (NEP) is a Brussels-based partnership of European and international organisations focused on carbon removals. Our members are primarily technology companies, but also include project developers, investors, carbon marketplaces, and buyers of carbon removals. We provide a forum in which diverse like-minded organisations actively collaborate to improve political and public recognition of carbon removals.