Emission reduction · Glossary

Emission reduction refers to the decrease in greenhouse gases or other pollutants relative to a defined starting point. This can be a base year, a reference scenario or a comparison plant. In climate policy it usually concerns carbon dioxide, methane, nitrous oxide and fluorinated gases. The German Federal Climate Change Act (Bundes-Klimaschutzgesetz) expressly also includes sulphur hexafluoride, nitrogen trifluoride and partially and fully fluorinated hydrocarbons. To make the gases comparable, they are converted into CO2 equivalents. The basis is their global warming potential, that is, their warming effect compared with carbon dioxide, usually over 100 years (GWP100).

The conversion factors are not natural constants. They depend on the assessment report of the Intergovernmental Panel on Climate Change (IPCC) that is used as a basis. According to the values currently cited by the German Environment Agency (Umweltbundesamt), one tonne of methane corresponds to 28 tonnes and one tonne of nitrous oxide to 265 tonnes of CO2 equivalent. Older reports used 25 and 298 respectively. Anyone comparing reductions over several years should therefore check whether the same factors were used throughout. For German reporting, the Climate Change Act provides that the global warming potentials follow the relevant EU requirements.

Absolute and relative reduction

An emission reduction can be expressed in absolute or relative terms. With an absolute reduction, the quantity actually emitted falls, for example from 100 to 70 million tonnes of CO2 equivalents. A real example: according to the German Environment Agency, German greenhouse gas emissions excluding the land use sector fell from around 1,253 million tonnes in 1990 to about 649 million tonnes in 2025. That is roughly 48 percent less. A relative reduction, by contrast, refers to a reference quantity, such as grams of CO2 per kilowatt hour of electricity, per tonne of steel or per vehicle kilometre. The two figures answer different questions. If emission intensity falls, total emissions do not automatically fall. If production rises sharply, the absolute quantity can even increase despite better efficiency.

Emission factors in the power system

In the power system, emission reduction is often described using the specific emission factor, usually in grams of CO2 or CO2 equivalent per kilowatt hour. It must be clear which factor is meant. The average emission factor spreads the emissions of total electricity generation across the total quantity of electricity. The marginal emission factor asks which generating unit is additionally ramped up or down when consumption or feed-in changes. For annual reports, product footprints and political target values, average values are usually used. For assessing additional loads, flexible consumers or short-term savings, the marginal approach is often closer to the technical effect. It is, however, model-dependent and cannot be measured directly. It must also be clarified whether only direct emissions from combustion count or also upstream emissions, for example from fuel extraction and plant construction.

Distinction from related terms

In practice, these terms are not used consistently. As a rough guide: emission avoidance usually means measures through which emissions do not arise in the first place, for example when a fossil process is replaced by an electric process using renewable electricity. Emission reduction is broader. It also includes efficiency improvements, fuel switching, carbon capture or a changed mode of operation of plants. Decarbonisation describes the structural phase-out of carbon-containing energy sources and processes in a sector or an economy.

Climate neutrality is likewise to be distinguished from emission reduction. The German Climate Change Act uses the narrower term net greenhouse gas neutrality. This means a balance between human-caused emissions from sources and the removal of greenhouse gases by sinks. This goal is to be achieved by 2045. After 2050, emissions are to be net negative. As interim targets, the Act prescribes a reduction of at least 65 percent by 2030 and of at least 88 percent by 2040, in each case compared with 1990. The Act also provides for targets for technical sinks and a long-term strategy for dealing with unavoidable residual emissions. Emission reduction is thus a step towards neutrality. It does not, however, replace clarifying which residual emissions remain and by which sinks they are offset.

Impact in the power system and time structure

In the power system, emission reduction is closely tied to the transformation of generation. If wind power, photovoltaics, hydropower or other low-emission sources displace coal-fired and gas-fired power plants, the direct emissions of electricity generation fall. Installed capacity alone, however, says little about this. What matters are generation profiles, grid connection, the merit order of the power plants, storage and the behaviour of demand. An additional photovoltaic system reduces emissions above all when its electricity displaces fossil power plants and is not curtailed because of grid bottlenecks. A heat pump reduces emissions above all when it operates efficiently over the year and its electricity increasingly comes from low-emission sources.

A kilowatt hour does not have the same climate impact at every hour. In hours with a lot of wind and solar power, additional consumption can be associated with significantly lower emissions than in hours in which fossil power plants cover the residual load. For flexible consumers, storage, electrolysers, charging infrastructure and industrial processes, this temporal attribution is becoming ever more important. Anyone who compares only annual quantities overlooks that the same amount of energy causes different amounts of emissions depending on the time.

A widespread misunderstanding equates falling electricity consumption with emission reduction. Lower electricity consumption can reduce emissions if fossil generation is thereby eliminated. With electrification, however, electricity consumption can rise while total emissions fall. If heat pumps replace oil and gas heating or electric cars replace combustion engines, energy consumption shifts into the electricity sector. Fossil primary energy consumption can fall significantly in the process. The decisive question is therefore which fossil energy sources are replaced, how low-emission the additional electricity is, and whether the grid can absorb the new load efficiently.

Base year and system boundary

Percentage figures for emission reduction say little without a base year and a system boundary. A reduction of 40 percent can relate to a company, a sector, a country, a plant or a product. The base years differ depending on the set of rules: the German Climate Change Act calculates against 1990, the EU emissions trading system for its 2030 target against 2005. A figure can capture territorial emissions, that is, emissions within a country. It can also be consumption-based and include imported goods. It can cover only direct on-site emissions or also indirect emissions from purchased electricity and supply chains. In corporate accounting, this corresponds roughly to the division into Scope 1, Scope 2 and Scope 3. The system boundary determines which responsibility becomes visible and which emissions remain outside the balance.

Institutional framework

Emission reduction is shaped by rules, prices and responsibilities. The European emissions trading system (EU ETS 1) caps emissions from electricity and heat generation, industry, aviation and maritime transport. One allowance entitles the holder to emit one tonne of CO2 equivalent. The cap falls every year by a linear reduction factor. Since the 2023 reform it amounts to 4.3 percent per year for 2024 to 2027 and 4.4 percent from 2028. In addition there are one-off reductions of 90 million allowances in 2024 and of 27 million in 2026. The aim is to reduce the emissions of the covered sectors by 62 percent by 2030 compared with 2005. The CO2 price makes emissions a cost factor and thus influences power plant dispatch, investments and fuel choice.

In addition, support programmes, efficiency standards, grid regulation, planning law and tenders for renewable energies have an effect. An emission reduction can therefore rarely be attributed to a single measure. It arises from technical substitution, economic incentives and binding caps. Within a system with a fixed cap, it must also be examined whether an additional measure really lowers total emissions or whether allowances that become free are used elsewhere. Mechanisms such as the market stability reserve influence this interaction.

Accounting for purchased electricity

For companies and public institutions, accounting plays a large role. For emissions from purchased electricity (Scope 2), the Scope 2 Guidance of the GHG Protocol provides for two methods. The location-based method uses average emission factors of the grid area. The market-based method relies on contractual instruments such as supply contracts or a guarantee of origin. If no such data are available, it falls back on a residual mix or likewise on the grid average. Under the rules currently in force, companies should as a rule report both values. The GHG Protocol points out that the location-based value can essentially be reduced only through lower consumption. The market-based value, by contrast, reflects procurement decisions. A guarantee of origin does not automatically change the physical dispatch of power plants in a particular hour. For a real emission reduction, what counts is whether additional low-emission generation is created, whether fossil generation is displaced, and whether generation and consumption match reliably in time.

Climate gases and local air pollutants

Emission reduction is not the same as local pollutant reduction. Coal-fired power plants, combustion engines and industrial furnaces emit, in addition to CO2, also nitrogen oxides, sulphur dioxide, particulate matter or mercury. Some measures act on both, for example the replacement of fossil combustion by electric applications. Often, however, both effects must be considered separately. A filter can reduce air pollutants without substantially reducing CO2 emissions. A fuel switch can reduce CO2 and at the same time change other environmental impacts. Clear terms prevent different protected interests from disappearing into a single figure.

Flexibility, grids and power

In electricity supply, emission reduction is increasingly linked to flexibility, grid planning and security of supply. A high share of renewable energies lowers the emissions of generation but requires more coordination between generation, consumption, storage and grids. If flexible loads run at times of low emission intensity, they facilitate the integration of renewable energies. If they generate additional load peaks in an uncoordinated way, they can make more grid expansion, reserves or fossil generation necessary. Power is therefore just as important as the quantity of energy, because bottlenecks and power plant dispatch are often determined by short-term peaks.

Precise statements

A statement on emission reduction is technically robust if the following points are disclosed:

Quantity and unit, that is, absolute in tonnes of CO2 equivalent or relative per reference quantity
Base year or reference scenario
System boundary, that is, territorial or consumption-based, direct or including upstream chains
Gases considered and global warming potentials used
Calculation method, that is, average or marginal factor, location-based or market-based, annual or hourly values

Without these details, the term remains compatible with other uses but imprecise. In the power system, emission reduction describes neither a single technology nor a single policy instrument. It means the measurable change in emissions through generation, consumption, market rules, grids and investments. Its strength lies in judging measures not by their intention but by their demonstrable effect on the greenhouse gases emitted.

Sources

Bundes-Klimaschutzgesetz (KSG) — Bundesministerium der Justiz / Bundesamt für Justiz; Stand: zuletzt geändert durch Art. 1 G v. 15.7.2024. § 2 Nr. 1, 2 und 9; § 3 Abs. 1 und 2; § 3b
Treibhausgas-Emissionen in Deutschland — Umweltbundesamt; unbekannt (Daten bis 2025). Abschnitt Emissionsentwicklung
Treibhausgas-Emissionen — Umweltbundesamt; unbekannt. Abschnitt zu CO2-Äquivalenten
EU ETS emissions cap — Europäische Kommission, GD Klimapolitik; unbekannt. Abschnitt Electricity and heat generation, industrial manufacturing and maritime transport
Top Ten Questions about the Scope 2 Guidance — Greenhouse Gas Protocol; unbekannt. Abschnitte zur standort- und marktbasierten Methode

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Edited by eCMS on 11.11.2026 19:45