How to Report Renewable Electricity and Carbon Credits in CDP 2025

Accurate climate disclosure can be challenging. In 2023, only 16% of companies provided sufficient documentation on renewable-electricity procurement and consumption, with the most common issues being unclear geographic boundaries, ignoring market-boundary rules, and relying on grid-average data instead of specific contractual instruments. Similar challenges often apply to carbon credit reporting, where evidence and precise data are just as critical.

What Is CDP and How Does It Work

The Carbon Disclosure Project (CDP) runs the world’s most widely used environmental disclosure system. Companies report through an annual questionnaire that covers climate change, forests, water security, plastics, and biodiversity disclosures. The 2025 cycle keeps the same integrated structure introduced in 2024, with refinements to make questions clearer and guidance more practical for reporters.

CDP’s methodology is closely aligned with the Task Force on Climate-related Financial Disclosures (TCFD) and the GHG Protocol. Strong CDP performance depends on well-structured data systems, precise organizational boundaries, clear financial quantification, and active supplier engagement.

The Climate Change Module (Module 7)

For climate-related disclosures, Module 7 remains the core. This section requires verified Scope 1–3 emissions, detailed energy consumption data, and information on renewable electricity procurement and carbon credit use.

Where data cannot be reported, CDP expects companies to provide a clear explanation of why it is unavailable.

In 2025, terminology in Module 7 has been streamlined, questions better aligned with recognized standards such as ICVCM, and verification documents can be uploaded multiple times. These changes were designed to make high-quality disclosure more practical. Third-party verification remains a recommended step to strengthen both credibility and comparability.

How to Report Renewable Electricity in CDP 2025

Module 7 covers a wide range of climate data, and renewable electricity is one of the areas where companies often lose points due to highly specific reporting rules. CDP requires not just volumes, but details on sourcing, technology, geography, and timing. Getting this right means understanding how CDP structures Scope 2 reporting.

Below are the main elements CDP expects for renewable electricity reporting, and the pitfalls to watch out for.

Dual Scope 2 Accounting

CDP asks for emissions to be reported in two ways:

• Location-based:  Calculated using the grid-average emissions factor for the regions where electricity is consumed.
• Market-based:  Calculated using contractual instruments such as renewable energy certificates (RECs or other EACs), power purchase agreements (PPAs or vPPAs), or green tariffs.

This allows companies to distinguish between the baseline emissions from local grids and the reductions achieved through specific procurement choices.

Market Boundary Rule

A key integrity safeguard is the market boundary rule. Under CDP’s guidance, certificates must be sourced from the same regional market where the electricity consumption occurs. This is designed to reflect a credible link between the environmental claim and the actual electricity system benefiting from renewable generation.

Data to Include

To meet CDP’s expectations, companies need to provide detailed information for each renewable electricity source, including:

• Total renewable electricity consumed (MWh) and, separately, self-generated renewable electricity.
• Procurement method for each volume claimed (e.g., unbundled EACs, green tariffs, PPAs/vPPAs, on-site generation).
• Low-carbon generation technology for each source (e.g., solar, wind, hydro, biomass).
• Geographic link between the location of consumption and the origin of the certificates.
• Relevant generation period or commissioning year for the project.

Verification

While third-party verification of market-based Scope 2 data is optional, CDP notes it as best practice. Having data verified strengthens strengthens the credibility of disclosures, reduces the risk of reporting errors, and may improve scoring outcomes.

Taken together, these requirements underscore the importance of having robust procurement records, traceable certificate documentation, and clear internal processes for tracking renewable electricity use. For many companies, this means coordinating across sustainability, procurement, and finance teams to align data sources and maintain evidence for both internal and external review.

How to Report Carbon Credits in CDP 2025

Module 7 covers a wide range of climate data, and renewable electricity is one of the areas where companies often lose points due to highly specific reporting rules. CDP requires not just volumes, but details on sourcing, technology, geography, and timing. Getting this right means understanding how CDP structures Scope 2 reporting.

Principles for Credible Carbon Credit Use

CDP’s guidance reinforces that credits should complement, not replace, direct emissions reductions. The core principles include:

1. Reduce emissions first.  Companies should set science-based targets and prioritize operational and value chain decarbonization before turning to credits.
2. Purchase high-quality credits.  These must be real, additional, permanent, and independently verified, with removal credits gaining increasing preference.
3. Report credits separately and transparently.  Avoid deducting credits from Scope 1–3 totals. Instead, disclose all relevant details, including origin, type, vintage, and standard, and confirm retirement through a recognized registry.

Defining a High-Quality Credit

Under CDP’s framework, high-quality credits meet criteria such as:

• Additionality (the project would not have occurred without carbon finance).
• Clear legal ownership.
• Measurable and quantified reductions or removals.
• Long-term permanence of climate benefits.
• Uniqueness (no double issuance or double counting).
• Independent third-party verification.

Carbon Credit Retirement Disclosure

Companies must state clearly whether carbon credits were retired during the reporting year. For each credit type, CDP requests the following details:

• Project type and mitigation activity (avoidance, reduction, or removal).
• Number of credits retired.
• Purpose of retirement (compliance vs voluntary).
• Vintage year, indicating when the underlying reduction or removal took place.
• Crediting programs, such as Verra’s Verified Carbon Standard (VCS), Gold Standard, American Carbon Registry (ACR), or Climate Action Reserve (CAR).

These expectations highlight a broader trend in climate disclosure: credit use must be tied to credible climate strategies and supported by evidence. For companies, this means maintaining strong documentation, selecting projects carefully, and ensuring all claims are transparent and verifiable for stakeholders, investors, and scoring bodies.

Ways to Improve RECs and Carbon Credit Reporting

While CDP’s reporting rules for renewable electricity and carbon credits are precise, companies can stand out by showing they understand both the technical requirements and the integrity expectations behind them.

Link Procurement to Your Wider Climate Strategy

RECs/EACs and carbon credits should be framed as part of a broader decarbonization plan, not as standalone actions. Inconsistent messaging between emissions reductions and these instruments can raise credibility questions, even if the data is correct.

Match Market Boundaries and Project Locations With Intention

For EACs, ensure market boundary compliance is more than a tick-box exercise. Choosing projects closer to consumption sites can strengthen the story you present to stakeholders. For carbon credits, align project geography with your climate or community impact priorities where possible.

Show Diligence in Credit and Certificate Quality

High-integrity instruments increasingly determine how your CDP responses are perceived. For EACs, this can mean applying RE100’s stricter commissioning-date and technology criteria. For carbon credits, it means prioritizing those that meet ICVCM or equivalent quality standards, and being able to explain why.

Track and Document Retirement Timing

CDP’s question on whether credits or EACs were retired during the reporting year may seem simple, yet gaps still occur. In some cases, companies delay procurement until reporting season, only to face shortages in certain markets. Securing instruments early avoids both availability issues and reporting inconsistencies.

Avoid Overreliance on Market Instruments

Even when rules are followed, CDP assesses these instruments within the context of your direct emissions reductions. Heavy reliance without a strong operational decarbonization plan can limit scoring potential and stakeholder confidence.

Keep Documentation Ready for Verification

The strongest CDP submissions are backed by documentation that could withstand a review. For every REC/EAC or carbon credit claim, keep purchase contracts, registry retirement confirmations, and third-party verification records. This supports full scoring and reinforces credibility with stakeholders.

In essence, CDP rewards more than accurate figures. It rewards credible procurement choices. Companies that integrate EACs and carbon credits into a transparent, quality-driven strategy will be better positioned for both high scores and long-term trust.

How CnerG Can Support Your CDP Reporting

CnerG aligns EAC and carbon credit purchases with CDP’s market-boundary requirements, RE100 guidance, and recognized quality frameworks such as ICVCM.

CnerG’s team secures supply early, helps avoid shortages in harder-to-procure regions, and provides the documentation needed for confident reporting. Whether you’re buying for current-year use or planning multi-year procurement, we make sure your renewable electricity and carbon credit strategy is both CDP-compliant and impact-driven.