Glossary

Greenhouse gases (also called climate-altering gases): gases in the atmosphere that allow infrared solar radiation to pass through as it strikes the Earth. In balanced concentrations, these gases are needed because, by retaining the heat escaping from the Earth's surface, they maintain the temperature levels required for life on the planet (without these gases, the temperature would be about -18 °C). Naturally occurring greenhouse gases in the atmosphere include carbon dioxide (CO2), water vapour (H2O), nitrous oxide (N2O), methane (CH4), and ozone (O3); some human activities not only increase the level of these gases, but also release other greenhouse gases such as sulphur hexafluoride (SF6), hydrofluorocarbons (HFCs) and perfluorocarbons (PFCs) into the air. The increasing and uncontrolled emission of greenhouse gases from human activities (e.g. the use of fossil fuels, industry, intensive livestock and crop farming, deforestation, and land consumption) is dangerously increasing the concentration of these gases in the atmosphere, hampering the dispersion of heat and causing an increase in average global temperatures (the so-called global warming).

Global warming and climate change: the increase in the average global temperature, due to a higher concentration of greenhouse gases in the atmosphere, naturally increases the frequency and intensity of weather events linked to it: cyclones, hurricanes, floods, droughts, desertification, melting ice, oceans rising and acidifying, heat waves, and frost waves. This set of phenomena is called "climate change" and severely impacts natural animal and plant ecosystems (loss of biodiversity and extinctions, growth of invasive species, disruption of balances and food chains), human health (spread of tropical diseases, extreme heat and cold weather, deterioration of quality of life, access to water supplies), economics (losses and adaptation costs) and in general global geopolitics (social instabilities, wars and mass migrations). The international scientific community agrees that human activities (industry, exploitation of fossil fuels, intensive livestock breeding, and deforestation) are the causes of global warming, since the increase in the concentration of greenhouse gases in the atmosphere and therefore of global average temperatures has greatly accelerated since the mid-eighteenth century (first industrial revolution).

Cop21: the twenty-first session of the Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC), held in Paris in 2015. At the conference, states recognised the need for an effective and gradual response to the urgent threat of climate change on the basis of the best available scientific knowledge. This is where the so-called “Paris Agreement” was formed, a global agreement that aims to hold the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 °C. These objectives are to be pursued both by increasing the ability to adapt to the adverse impacts of climate change and foster development that ensures both climate resilience and low greenhouse gas emissions.

Global Warming Potential (GWP): a factor that compares the contributions to the greenhouse effect of different greenhouse gases over a given time period, relative to carbon dioxide; in other words, it represents an estimate of how much a given mass of greenhouse gas contributes to global warming compared to the same amount of CO2, whose reference potential is set to 1 (carbon dioxide equivalent, CO2e). For example, over a period of 100 years one molecule of methane has a global warming potential about 28 times greater than carbon dioxide, and is therefore counted as 28 molecules of CO2e.

Carbon footprint: an indicator used to express and quantify the greenhouse gas emissions caused by products and services, industrial processes, individuals, organisations, or even entire nations. It is expressed as carbon dioxide equivalent, i.e. taking CO2 as the reference for all emissions considered in the calculation. Measuring one's own carbon footprint rapidly quantifies one's climate impact, so as to compare it over time and implement more targeted and effective carbon management strategies and achieve competitive advantages in terms of social and environmental responsibility. The carbon footprint is broken down into direct emissions, indirect emissions from energy consumption, and other indirect emissions along the value chain.

Direct emissions (Scope 1): emissions produced within the perimeter of the organisation or body under study, i.e. from sources and processes owned by it or under its control. Examples are: combustion of fuels in owned facilities, fuel consumption in company vehicles for transporting materials and workers, fugitive emissions from air conditioning systems.

Indirect emissions from energy consumption (Scope 2): emissions from the generation of electricity and/or heat consumed by the organization within its perimeter, but generated elsewhere.

Other indirect emissions (Scope 3): emissions occurring along the value chain of the organization or body as a result of its activities but in sources and processes not owned or controlled by it. Examples include the purchase of goods and services, the extraction and production of fuels and fuels consumed internally, losses along the electricity grid of energy purchased for consumption, the transport of goods, the transport and disposal of waste generated, the home-work journey of employees, business travel, the use by customers of products and services sold, and the end-of-life disposal of products sold. They are broken down into Scope 3 upstream (upstream, inbound activities) and Scope 3 downstream (downstream, outbound activities) emissions.

Location-based and market-based indices: conversion factors applied to energy consumption to calculate Scope 2 indirect emissions. The location-based factor takes into account the average gross emissions generated from all energy production sources throughout the country (renewable and non-renewable) and is applied to all consumption, thus not differentiating between energy from fossil/thermal sources and from zero-emission renewable sources. The market-based factor takes into account the emissions deriving from non-renewable sources only, and is applied to the share of consumption coming from emissive sources; it is used when an organization chooses to purchase energy from certified renewable sources, and expresses the emission savings due to this choice (energy consumption from certified renewable sources are, in fact, zero-emission).

Carbon offsetting (Beyond value chain mitigation): the use of the so-called carbon credits to finance projects in developing countries that reduce or avoid the emission of GHGs into the atmosphere (e.g. by reducing fossil fuel consumption through energy efficiency improvement measures or the use of renewable energy sources, or improving access to clean water), or remove carbon dioxide from the atmosphere through (for example, reforestation projects or the preservation of existing forests and carbon sinks).

Carbon credit: a certificate stating that one tonne of CO2e emission has been avoided, reduced or removed. If generated through the development of mitigation projects that follow precise methodologies and international standards, it is certified by an external accreditation programme (VCS, Gold Standard, CDM). Carbon credits are typically purchased by organisations as a means to offset emissions beyond their value chain, to support energy transition in developing countries. Carbon credits are stored and “cancelled” in a third-party registry officially recognised by the certification standards.

Carbon neutrality: the condition in which, in a process designed to reduce emissions to the levels required by the Paris Climate Agreement, anthropogenic emissions of carbon dioxide equivalent in the atmosphere are balanced by equal offsets, removal or absorption.

Net-zero emissions: the condition in which, upon completion of emission reductions to the levels required by the Paris Climate Agreement, residual anthropogenic emissions of all greenhouse gases in the atmosphere that are no more physiologically avoidable or reducible are offset by equal removal or absorption. At the end of 2021, the Science Based Targets initiative (SBTi) published the "Net Zero Standard," which is an official standard for organizations to adopt for an effective, fair and credible emissions reduction strategy in line with the Paris Climate Agreement and the latest guidance from the international scientific community (e.g., IPCC).

Science Based Targets initiative (SBTi): a partnership between CDP, the United Nations Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF) established to support organizations that set targets to reduce greenhouse gas emissions at the rates required by the Paris Climate Agreement, i.e. to limit global temperature rise to well below 2 °C and, if feasible, to 1.5 °C. For companies, setting science-based emission reduction targets and obtaining their official validation by the SBTi is a tool to gain competitive advantage in the transition to a low-carbon economy, e.g. by stimulating the adoption of innovative technologies and processes and attracting the confidence of investors, customers, and workers.

Intergovernmental Panel on Climate Change (IPCC): international scientific body established by the United Nations (UN), the World Meteorological Organization (WMO), and the United Nations Environment Program (UNEP) in 1988 for the purpose of studying the global scientific literature on global warming to provide governments and policymakers with a clear and comprehensive view of the current state of knowledge on climate change and its impacts.

Renewable energy sources: generate energy from natural sources that are inexhaustible in human time (sun, wind, waterways, tides), with limited if any environmental impact (unlike nonrenewable energy sources that pollute and emit greenhouse gases, run out, and for whose regeneration new resources must be consumed). The following are renewable sources: wind (energy from the wind), solar (sun), geothermal (Earth's internal heat), hydroelectric (rivers and streams), and biomass (biodegradable plant or animal parts from agricultural wastes, refuse, and forestry).

Biomethane: renewable fuel gas containing at least 95 percent methane that is generated by fermenting waste of organic origin (from separate collection, pruning, and agro-industrial vegetable or animal waste) in specific anaerobic digestion plants and upgrading processes. It is entirely suitable for injection into existing natural gas transmission and distribution networks. Although its combustion still emits carbon dioxide into the atmosphere, it is part of the natural carbon cycle; moreover, since it is not of fossil origin, all the upstream operations of extraction, refining and transportation that are highly polluting and impacting the atmosphere and ecosystems are avoided.

Hydrogen: first chemical element in the periodic table, the most abundant in the universe. There is little of it on Earth in the free, molecular state, and so it must be produced chemically or biologically for its various uses: in particular, it is currently used in ammonia production, in the hydrogenation of vegetable oils, in aeronautics (formerly in airships), as an alternative fuel for industry and automotive use, and more recently as a power reserve. There are various ways in which hydrogen can be generated. Among the main ones, it is classified into: "gray," if produced by reaction processes of reforming fossil methane gas with steam; "blue," if there is a system to capture the emitted CO2 at the end of that process; and finally, "green," if produced by electrolysis of water fed to renewable electricity. To date, more than 90 percent of the hydrogen produced today comes from fossil sources. Its use does not emit climate-altering gases, so it can be exploited as a fuel to replace fossil sources; on the other hand, its production would provide dubious energy gain from a thermodynamic point of view as well as efficiency losses, and safety, storage and transportation issues are also to be carefully evaluated.

Task Force on Climate-related Financial Disclosures (TCFD): a task force established by the G20 Financial Stability Board in 2015 to support the financial community in considering climate change-related variables in their investment decisions. To pursue this objective, it has developed a set of recommendations and guidelines for organizations of all sectors and sizes to encourage them to improve their awareness and clear reporting on the risks and opportunities that may influence their businesses as a result of climate change. The TCFD’s climate-related financial disclosure recommendations are structured around four key thematic areas (governance, strategy, risk management, and metrics and targets).

Climate scenario analysis: the methodology used to help understand how climate opportunities and risks (physical and transitional) may affect our business over time. It consists of a process used to test the organization’s resilience under different assumptions describing possible future climate conditions. Climate scenarios describe diverse but equally plausible and internally consistent environmental, regulatory, competitive and technological contexts. The TCFD classifies climate scenarios into two categories according to the type of variables whose future evolution they describe: transition scenarios that describe plausible future conditions from a demographic, political and regulatory, economic and technological perspective, and physical scenarios that describe the change over time of physical variables such as the temperature, precipitation, and sea level corresponding to certain concentrations of greenhouse gases in the atmosphere. Transition scenarios describe policy and legal, market, and technological developments, which will be all the more disruptive the more they are aimed at limiting global warming. Physical scenarios identify the potential consequences of natural events for the organization, the overall impacts of which worsen as the global average temperature increases. In other words, physical risks increase with increasing temperature; transition risks, on the other hand, are greater when the temperature increase is smaller.

CDP (Carbon Disclosure Project): an international not-for-profit charity that provides businesses, cities, regions and sub-national states with a global system for measuring, monitoring and disclosing data and information regarding environmental sustainability issues. It aims to work with market forces to motivate organizations to measure and disclose their impacts on the environment and natural resources, and then take action to reduce them. Organizations participate in the project by filling in a questionnaire, either on a voluntary basis or as specifically requested by a customer. Through CDP, stakeholders interested in given organizations (customers, investors, communities and governments) can consult information on their environmental performance to steer their policies and investment and consumption decisions.

ISO 50001 Energy Management System: a standard that supports organisations in any sector in defining energy management strategies with the aim of continuously improving their energy performance and efficiency.