ESRS Standard
ESRS Standard
62 The company shall disclose whether it uses internal carbon pricing systems and, if so, how these support its decision-making and incentivize the implementation of climate-related policies and Targets.
63. the information required under paragraph 62 shall include the following:
(a) the nature of the internal carbon pricing system, such as shadow prices, internal carbon charges or internal carbon funds applied for CapEx or research and development (R&D) investment decisions,
(b) the specific scope of the carbon pricing systems (activities, geographical indications, companies, etc.)
(c) the carbon prices applied according to the type of scheme and critical assumptions used to determine the prices, including the source of the carbon prices applied and the reasons why these prices are considered relevant for the chosen application. The company may disclose the methodology used to calculate the carbon prices, including the extent to which these prices have been set using scientific guidance and how their future development relates to science-based carbon pricing trajectories; and
(d) the approximate quantities of the current year's gross GHG emissions (Scope 1, 2 and, where applicable, Scope 3) in metric tons of CO2 equivalent covered by these schemes and their share of the company's total GHG emissions for each scope.
Application Requirements (AR)
Application Requirements (AR)
AR 65 When disclosing the information required by paragraphs 62 and 63, the company shall briefly explain whether and to what extent the carbon prices used in internal carbon pricing systems are consistent with the prices used in the financial statements. This is done by considering the Internal carbon prices used for the following:
(a) the measurement of the useful life and residual value of its assets (intangible assets, property, plant and equipment),
b) the impairment of assets and
c) the measurement of the fair value of assets acquired through business combinations.
AR 66 The information can be presented in the table below:
Type of Internal carbon price | Volume involved (t CO2e) | Prices applied (€/t CO2e) | Description of the volume |
CapEx shadow price | |||
Research and development (R&D) Investment shadow price | |||
Internal CO2 charges or funds | |||
CO2 prices for impairment testing | |||
etc. |
Examples from previous practice
Examples from previous practice
Examples are merely indicative of how disclosure requirements have been reported by other companies to date. Audited ESRS reports are not yet available. There is no guarantee of accuracy and completeness.
E1-8 - Internal carbon pricing
Internal carbon price
In 2022, an internal carbon price (ICP) of EUR 65 per tonne of CO₂ was introduced, which applies in addition to the legally prescribed carbon prices at various company sites (e.g. through emissions trading systems). The ICP was applied to capex projects with a volume of over EUR 1.8 million in 2023 as part of strategic investment planning. The aim of the internal carbon price is to reduce future CO₂ Risks, prioritize renewable fuels over fossil fuels and promote projects to increase energy efficiency.
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