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Scope 3 Standard Programprogram detailsBreadcrumb SeparatorScope 3 Standard (S3S) Program FAQs

Scope 3 Standard (S3S) Program FAQs

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Below are the most common questions about Scope 3 accounting and Verra’s Scope 3 Standard (S3S) Program. These FAQs will be continually updated to include further information about the S3S Program and related programs and initiatives, such as the Greenhouse Gas Protocol (GHGP) and the Science Based Targets initiative (SBTi), in corporate value chain accounting.

1. The Scope 3 Standard (S3S) and Verified Carbon Standard (VCS) Programs

The S3S and VCS Programs both use project-based accounting and standardized quantification methodologies to estimate the greenhouse gas (GHG) emission reductions and/or carbon dioxide removals achieved by implementing project activities. Both programs operate on the Verra Registry, using it as their shared system for record‑keeping and information management

The VCS Program enables project proponents to implement activities that reduce GHG emissions or remove carbon dioxide from the atmosphere, resulting in carbon credits that can be purchased by any entity without requiring a value chain connection to the project. The VCS Program is generally used in the context of GHG offsetting.

The S3S Program adapts components of the VCS Program to similarly quantify the GHG emission reductions or carbon dioxide removals achieved by projects. However, S3S Program units are designed for use in Scope 3 emissions reporting and include related information such as the type and amount of product impacted by the project. To be issued reportable units, companies will also need to demonstrate a value chain connection to the impacted product.

Yes, a project may be registered in both the VCS and S3S programs concurrently, if it meets the requirements of both programs. However, projects can only be active and issue units in one program at any given time, i.e., a project can only be issued units for reductions and removals that were generated after it has stopped being active in the other program.

If a project wants to switch programs and have reductions and removals for a given monitoring period verified under the other program, the project proponent must request that the project’s status in the original program be changed to withdrawn. Note that in both VCS and S3S Programs, a project’s withdrawn status does not cancel the project’s registration in that program.

Verra will publish guidance on how to transfer registered VCS projects to the S3S Program closer to program launch. Note that transfers of partial projects (e.g., a subset of farm fields) will not be enabled under version 1.0 of the S3S Program but may be possible under future versions.

Project proponents should note the more stringent additionality requirements and the more prescriptive listing, registration, and safeguard deadlines in the VCS Program—which, if missed, could make an S3S project ineligible for registration with the VCS Program. Given these differences in program requirements, we recommend that projects considering participation in both programs either register in the VCS Program first or pursue registration in both the VCS and S3S Programs simultaneously.

More guidance on this topic will be provided prior to the launch of version 1.0 phase 2.

No, unit conversion between programs is not possible. In other words, converting Verified Carbon Units (VCUs, which are carbon credits issued by the VCS Program) into units issued by the S3S Program, and vice versa, is not allowed.

Project proponents and other stakeholders (e.g., companies with Scope 3 emissions targets and impacted product originators like farmers or manufacturers) might choose the S3S Program in the following cases:

  • If they want to report (or enable the reporting of) certified emission reductions or removals to demonstrate progress on Scope 3 emissions targets
  • If they want to enable or coordinate co-investment and co-claiming of emission reductions by multiple organizations across different supply chain tiers
  • If they want to use transparent, tested, science-based and standardized GHG quantification methods, tailored for use in corporate Scope 3 emissions reporting.

2. The S3S Program – The Basics

An S3S project is an initiative that reduces GHG emissions or removes carbon dioxide by implementing technologies or measures that affect the emissions footprint of a product in a value chain, i.e., an impacted product (see “What is an impacted product?” below).

A project must meet the following key criteria to be eligible for registration in the S3S Program:

  • It must affect emissions within a value chain (i.e., generate GHG outcomes attributable to an impacted product).
  • It must apply and meet the eligibility requirements described in a methodology that is approved for use in the S3S Program.
  • Its activity start date must be on or after January 1, 2015.
  • It must meet all other applicable requirements set out in the S3S Standard and other program documents.
  • The project proponent must demonstrate the right to operate the project and the right to the GHG outcomes, as described in the S3S Standard.

Proponents of projects in the S3S Program may be any of the following entities:

  • The originator of an impacted product (e.g., steel manufacturer)
  • A company that reports on Scope 3 emissions targets
  • Another entity, such as a specialist project developer, government entity, or financial institution.

To be eligible, the entity serving as the project proponent must have the right to operate the project and the right to the GHG emission reductions and carbon dioxide removals resulting from the project. Note that the project proponent has the option to enable third parties (e.g., consultants) to access and input project information into the Verra Project Hub on the project proponent’s behalf.

Please note: Each S3S project can only have one project proponent.

Version 1.0 certifies value chain projects and issues Scope 3 Units (S3Us) representing project’s GHG outcomes to project proponents.

Version 2.0 builds on version 1.0 and establishes the right-to-report, i.e., the process by which a company demonstrates a credible supply chain connection to the impacted product in an S3S project (see “What is the right-to-report?” below). This enables the issuance of reportable S3Us to reporting companies.

The S3S Program will issue the following two types of units:

  • Scope 3 Units (S3Us): These units will be issued by version 1.0 of the program.
  • Reportable S3Us (exact naming TBD): These units will be issued by version 2.0 of the program.

The following applies to S3Us:

  • S3Us are issued to the project proponent.
  • Each unit represents one tonne of CO2e reduced or removed by an S3S project.
  • Each S3U includes attributes that convey additional relevant information (e.g., type and amount of impacted product and leakage emissions per unit, baseline type, reversal risk.).

The following applies to reportable S3Us:

  • Reportable S3Us are derived from S3Us and issued expressly to an individual reporting company that has a verified right-to-report based on the company’s credible supply chain connection to the project.
  • Each unit includes the same information (e.g., GHG outcomes, impacted product, leakage.) as the S3U from which it originates.
  • Reportable S3Us are non-transferable between companies as they are issued to an individual company based on its right-to-report and a verified allocation method.

The right-to-report represents the S3S Program requirement that a company has a verified value chain connection to an impacted product in an S3S project. Once established, a right-to-report enables a reporting company to be issued reportable S3Us (based on a verified allocation method) for use in the company’s Scope 3 emissions reporting.

In the context of the S3S Program, an impacted product is any product that is directly affected by the project activities (within the defined project boundaries) and that is intended for commercial sale. Input or derivative products elsewhere in the supply chain are not impacted products. For example, in a project that reduces dairy livestock emissions using feed additives, the impacted product would be raw milk, not derivative products like cheese or yogurt.

In the context of the S3S Program, co-claiming is a permissible situation where companies in different tiers of a value chain claim the same emission reductions or removals in their Scope 3 emissions reporting. Due to the shared nature of emissions in value chains, co-claiming is not considered double counting. Co-claiming is enabled in the S3S Program through the right-to-report certification combined with issuances of reportable units to companies at different supply chain tiers. Version 2.0 of the S3S Program will develop this functionality alongside procedures and safeguards to prevent over-issuance in co-claiming situations.

Within a single tier of the supply chain, the maximum number of reportable units that could be issued will be equal to the number of S3Us issued to the project proponent (i.e., the total GHG outcomes achieved by the S3S project). For example, if an agricultural land management project was issued 50 S3Us for reduced fertilizer emissions in wheat production, a grain milling company could be issued up to 50 reportable units (equivalent to 50 tCO2e) if it can establish the right-to-report, including evidence that it sources an amount of the equivalent type of wheat that is equal to or greater than the amount and type directly affected by the project. Other companies in different supply chain tiers (e.g., breakfast cereal production, retail) could also be issued up to 50 reportable units because they share the emissions from the wheat production in their Scope 3 inventories. Note that any such claims are limited by the amount of impacted product that the reporting company sources.

Yes, the S3S Program will use a digital-first approach. All project-related processes will be routed through the Verra Project Hub and the Verra Registry. This includes the collection of data and quantification of GHG outcomes using standardized and digitalized calculators derived from approved S3S Program methodologies.

3. The S3S Program and Corporate Inventory Reporting

In the broader Scope 3 landscape, “intervention” sometimes refers to a project (or program) implemented within a value chain to reduce GHG emissions and/or remove carbon dioxide. Historically, the S3S Program also used the term “intervention” in this way. However, this was changed to align the terminology of the S3S Program with the VCS Program, which uses the term “project.”

The GHG Protocol, SBTi, and Verra’s S3S Program are complementary frameworks that all seek to advance corporate climate action in tandem in the following ways:

  • The GHG Protocol provides company-level accounting standards and guidance for corporate GHG inventories, establishing how companies should measure and report their emissions.
  • SBTi sets science-based criteria for corporate emissions targets and validates those targets.
  • Note: SBTi refers to GHG Protocol’s standards and guidance for how companies can demonstrate progress and achievement toward emissions targets.
  • The S3S Program provides a certification framework for projects that result in emission reductions or removals within value chains and for the companies that may be able to demonstrate credible claims to those emission reductions and carbon dioxide removals. It uses detailed and standardized requirements, procedures, quantification methodologies and third-party verification for application to projects.

The S3S Program requirements are designed to complement and operationalize GHG Protocol accounting standards and guidance to help companies demonstrate credible progress toward their SBTi-approved targets. The S3S Program fills a crucial gap between Scope 3 target-setting (through SBTi) and accounting (through GHG Protocol) by quantifying the impact of material actions being taken in value chains.

The S3S Program provides standardized, verified data about GHG outcomes from value chain projects. The program gives companies flexibility in how they may account for the impact of projects in their value chain by supporting both substitution integration and subtraction integration methods, described as follows:

  • Substitution integration: an approach where project‑specific emissions data replace part of a generic emission factor (representing the impacted product’s total life cycle emissions) in the corporate GHG inventory, so reported emissions directly reflect the lower‑emissions activity.
  • Subtraction integration: an approach where quantified emissions reductions from a project are subtracted from a generic (e.g., common practice) emission factor and may be reported alongside the inventory to show net or adjusted emissions impacts without fully replacing the underlying emissions factor.

For more information, refer to the S3S Program Integration Guidance.

Note that there is much debate among key standards and initiatives around how various types of accounting methods could be applied to corporate emissions reporting. The S3S Program is designed to give its users flexibility to future-proof for developments in corporate emissions accounting and reporting, while promoting credible climate action and pragmatic accounting today.

The S3S Program bridges inventory (a.k.a. attributional) accounting and project-based (a.k.a. consequential) accounting in the following ways:

  • By collecting and verifying robust data from value chain projects
  • By providing transparent information on emissions boundaries, quantification methods, and assumptions
  • By structuring data to enable flexible integration into companies’ emissions reports; this includes the presentation of baseline and project scenario data (1) in combination (i.e., quantification of emissions impacts relative to a baseline, a.k.a consequential accounting) and (2) separated (i.e., emissions for emissions sources, sinks and reservoirs that materially change as a result of the project activities, a.k.a attributional accounting)

This approach allows companies to leverage the strengths of both accounting approaches when reporting on their value chain emissions. At the same time, it enables flexibility and transparency in companies’ emissions accounting.

The S3S Program requires quantification using project-based accounting, which ensures that S3S projects implement specific activities that result in emission reductions or removals relative to a baseline scenario. This helps safeguard against companies reporting lower emissions solely due to changes in accounting which may not have an actual atmospheric GHG benefit.