The American Petroleum Institute, which includes Exxon Mobil Corp and Chevron Corp, said the framework aims to standardize the way companies track emissions, including flared natural gas, and prompts them to voluntarily disclose those details publicly.
Aaron Padilla, API’s manager of climate and ESG policy, said on a call with reporters that the template “gives a foundational picture of a company’s work to mitigate greenhouse gas emissions,” and also helps standardize reporting indicators to allow comparisons between companies.
The framework comes on the heels of plans by the U.S. Securities and Exchange Commission to introduce new climate-mitigating rules as it steps up environmental, social and governance (ESG) disclosures.
The five sections of API’s disclosure template include ones to log and disclose data on greenhouse gasses emitted directly from company assets, and emissions from the energy the companies use.
There are also sections for companies to report emission reduction efforts through the use of renewable electricity, carbon capture and other measures, as well as details about how the companies independently verify their data.
API’s new guidelines exclude so-called Scope 3 emissions, which take into account greenhouse gas emissions from customers using the oil and gas they have purchased for transportation and other uses.
The trade group said the template is not mandatory, but it expects companies will choose to use it. First reporting is expected in 2022.
The guidelines follow API’s announcement earlier this year that it would endorse carbon-price policy, easing its previous resistance to regulatory action on climate change amid a shift in the oil industry’s strategy on the issue and the new U.S. presidency.