SBTi Ongoing Emissions Responsibility (OER): What It Means and How to Prepare

For years the message to companies was to cut emissions first and worry about credits much later, somewhere near the 2050 finish line. The second draft of the Science Based Targets initiative (SBTi) Corporate Net-Zero Standard, published in November 2025, changes that. It gives carbon credits a defined, structured role from the moment a company sets a target, through a new mechanism called Ongoing Emissions Responsibility (OER).

For sustainability and procurement teams at SBTi-committed companies, OER turns a vague future obligation into a near-term planning question. This guide explains what OER is, the two recognition tiers and exactly what they require, when it becomes mandatory, which credits qualify, what it is likely to cost, and how to decide whether to act now or wait. Every figure here comes from SBTi's own Ongoing Emissions Responsibility framework document and the v2 consultation draft.

If you want the wider picture of everything changing in version 2.0, we covered that in our breakdown of the SBTi v2 draft. This article goes deep on the OER part specifically.

What ongoing emissions responsibility actually is

Ongoing emissions are the greenhouse gases a company keeps releasing every year while it works toward net zero. SBTi draws a useful line here. Residual emissions are the smaller slice that remains in the net-zero year after a company has done all the abatement its science-based pathway allows. So all residual emissions are ongoing emissions, but most ongoing emissions are not yet residual. OER is about the bigger number: the emissions you are still producing on the way down, not just the ones left at the end.

OER replaces the framing that used to be called Beyond Value Chain Mitigation, or BVCM. We explained the old concept in our BVCM explainer. BVCM has not disappeared. It is now one way to take responsibility under a wider umbrella. SBTi widened the scope because the value-chain distinction was limiting: a removal project can sit inside or outside a company's value chain, and companies also wanted to fund things like adaptation that BVCM did not cleanly cover.

Under OER, a company can take responsibility through two routes:

1. Verified mitigation outcomes. Funding activities that reduce emissions outside your value chain, protect or restore natural carbon sinks, or capture and store carbon. In practice this means high-integrity carbon credits.
2. Climate finance. Directing money toward eligible activities such as advance market commitments, low-carbon research and development, adaptation and resilience, or loss-and-damage response.

The first route delivers measurable tonnes now. The second funds the scale-up of solutions the world will need later. A company can use either, or both.

Recognized and Leadership: the two tiers

The draft sets out two levels of voluntary recognition, shown on the SBTi dashboard, that a company can pursue today. The numbers below are the exact thresholds in the framework.

The two voluntary OER recognition tiers in the SBTi v2 draft. Source: SBTi Ongoing Emissions Responsibility framework.

A few things worth pulling out. Recognized is deliberately accessible. SBTi modelled corporate profits, emissions intensity and credit prices across sectors and landed on 1% as a level high enough to signal real action but low enough that most companies can reach it. The USD 20 benchmark sits between the cheapest reduction credits (around USD 5 per tonne) and widely available nature-based removals like afforestation (roughly USD 15 to 40 per tonne in SBTi's own figures).

Leadership is a different order of commitment. Pricing 100% of your ongoing emissions at USD 80 per tonne, then spending at least 40% of that on verified mitigation, is expensive for any large emitter. The 40% figure is not arbitrary: it mirrors the median ratio of removals to emissions in the IPCC 1.5°C pathways SBTi used. For most companies, Recognized is the realistic near-term goal and Leadership is a statement reserved for a few.

The timeline, and the 2030 versus 2035 question

This is where buyers get confused, so it is worth being precise. There are several dates, and they do different things.

• At v2.0 launch (expected in 2026, once the standard is finalised). Two things switch on immediately: every company must disclose how it is handling ongoing emissions, and the voluntary Recognized and Leadership tiers become available to pursue.
• From 1 January 2028. Under the wider v2.0 standard, version 2.0 becomes mandatory for companies setting new science-based targets, who must then disclose whether they invest in carbon credits.
• From 2035. OER stops being voluntary for the largest companies. SBTi calls these Category A companies, which the draft defines as large businesses (more than 1,000 employees or over USD 450 million in revenue). They will have to take responsibility for a share of ongoing emissions through real mitigation, and that share rises on a straight line toward 100% by 2050.

So when a colleague asks "is it 2030 or 2035?", the answer is 2035 for the mandatory OER obligation. The 2030 date people half-remember is the global science milestone (halving emissions by 2030), not an OER deadline. Mandatory responsibility for ongoing emissions begins in 2035 for large companies, and the exact starting percentage is still being consulted on, with 1% floated as a likely starting point.

One more date sits at the far end. In a company's net-zero target year, it must neutralise 100% of its residual emissions, with 41% met through long-lived removals (storage measured in centuries) and the remaining 59% through short-lived removals, more long-lived removals, or a mix. That neutralisation rule carries over from the first version of the standard and is separate from OER, though it shapes the kind of removal supply you will eventually need.

Which credits actually count

Before 2035, the Recognized tier is permissive on type. Any high-integrity credit can count toward your 1%, whether it reduces or removes emissions. The catch is the word integrity. SBTi requires that each credit genuinely represents a tonne reduced or removed on accepted accounting methods, and the market's working proxy for that is the ICVCM Core Carbon Principles label. Quality is not a formality here. The 2024 Nature study on credit integrity found that the large majority of assessed credits were at high risk of not delivering the reductions they claimed, which is why screening matters more than price.

In practice, that pushes buyers toward a shrinking set of defensible categories. Here is how we see the methodology landscape for a portfolio that needs to survive scrutiny:

• Afforestation and reforestation (ARR). The highest-quality nature-based removal category, and badly supply-constrained. Roughly €17 to €70 per tonne.
• Biochar. The commercial workhorse on the removal side, with permanence measured in hundreds of years. From about €120 per tonne. German projects are a genuine advantage for German buyers.
• Direct air capture (DAC). A credibility anchor rather than a volume play, at €1,500 and up per tonne.
• Older avoidance categories like legacy REDD+, grid-connected renewables and many cookstove projects. We mostly screen these out. Additionality and over-crediting concerns make them hard to defend in a disclosure.

After 2035 the rules tighten. Mandatory responsibility has to be met with ex-post mitigation that actually reduces or removes carbon, and it must include a defined share of long-lived removals. SBTi has not set that share yet, but the direction is clear: the market is moving toward durable removal, and the supply of high-quality removal credits is the constraint, not the demand. We made the fuller case for removal versus avoidance separately.

What it is likely to cost

The honest answer is that it depends on your emissions and which tier you target, but the framework gives enough to model a range.

At the Recognized level, the money-for-ton route uses a simple formula: your covered emissions multiplied by an internal carbon price of at least USD 20 per tonne. SBTi published its own illustration. For an emissions-intensive sector like chemicals, meeting a 1% responsibility level works out to roughly 0.4% of annual profit, around USD 15 million under conservative price assumptions. For a lighter sector like food and drink, the same 1% is closer to 0.1% of profit, around USD 5 million. Those are SBTi's figures, and they scale as the required percentage rises after 2035.

The ton-for-ton route is priced by what you actually buy. At current market prices, 1% covered with afforestation credits is cheaper than the same volume in biochar, which is far cheaper than DAC. The mix you choose is a quality and durability decision as much as a budget one.

Leadership is materially more expensive, because the USD 80 price applies to 100% of ongoing emissions and at least 40% of that budget has to buy verified mitigation. For most large emitters that runs into eight or nine figures a year, which is why it stays rare.

One cost lever is timing. Buying removal supply now, or locking future delivery through forward and offtake contracts, hedges against the price rises that a wave of OER demand will create. If even a fraction of the roughly 12,000 SBTi-aligned companies adopt the minimum 1% level, analysts estimate annual demand above 100 million credits, against a current voluntary market of around 200 million. That is a lot of new demand chasing a constrained supply of high-quality removal.

How to calculate your 1%

Three practical steps for the Recognized tier:

1. Start from ongoing Scope 1 to 3 emissions, not just operational emissions. OER covers all three scopes, and for most companies Scope 3 is the bulk of the number.
2. Take 1% of that total. That is the tonnage you cover ton-for-ton, or the emissions base you apply your internal carbon price to for the money-for-ton route.
3. If your Scope 3 data is incomplete, use your best current inventory and a conservative estimate, and document the basis. A 1% obligation is forgiving of imperfect Scope 3 data in a way that a 100% neutralisation claim never would be, so missing Scope 3 precision is not a reason to wait.

Should you opt in now, or wait?

The standard is still a draft, so the instinct to wait is understandable. Here is the case for moving before it is finalised.

Mandatory disclosure means inaction becomes visible. Once v2.0 lands, you have to state how you are handling ongoing emissions and whether you invest in credits. A blank answer is itself a disclosure, and one your larger customers and investors will read. Several of the procurement teams we work with are already asking suppliers what their plan is.

Early movers also shape supply and price. The high-quality removal credits that will satisfy a rising post-2035 requirement are in short supply today. Companies that build relationships and lock forward contracts now will have more choice and better prices than those entering a crowded market in the early 2030s. SBTi makes a version of this argument itself, framing early action as a way to hedge against future cost and regulatory exposure while building credibility with investors.

This is exactly the problem our SBTi OER portfolio is built for: an audited, v2-aligned portfolio sized to your 1% obligation, with payment on delivery so you are not tying up capital. For the mandatory post-2035 removal requirement, our 2035 Reserve locks future removal supply at a fixed price today.

What is still in draft

The OER framework sits in SBTi's second public consultation, which ran into December 2025. The final standard is expected in 2026, and some details will move. The exact post-2035 starting percentage, the required share of long-lived removals, and the carbon price benchmarks are all still subject to revision and inflation adjustment. The structure above (the two tiers, the 1% and 100% coverage, the USD 20 and USD 80 prices, the 2035 mandatory date) reflects the current draft. We will update this guide when the final standard publishes.

Ongoing Emissions Responsibility moves carbon credits from a 2050 afterthought to a question on this year's agenda. The companies that treat it as a planning problem now, rather than a compliance scramble in 2035, will spend less and have better options. If you want help sizing your 1% and building a portfolio that holds up to scrutiny, talk to our team.