Glossary entry

Carbon Negative

Definitions

Option 1

Where Greenhouse Gases [sequestered] [removed from the atmosphere] [absorbed by the [processes] [activities]] [of [name of party]] are greater than Greenhouse Gases emitted [by [name of party]].

Option 2

Where there is a net sequestration effect from either production or total lifecycle impact of a product leading to negative Greenhouse Gas emissions.

Option 3

Where [an entity] has achieved a Net Zero Target but has also created an environmental benefit by removing Greenhouse Gases from the atmosphere or reducing its Greenhouse Gas Emissions to the atmosphere such that the aggregated reductions and removals exceed the unabated emissions.

Option 4

An [activity/technology] that absorbs more carbon dioxide from the atmosphere than it emits.

Option 5

The reduction of an entity’s Carbon Footprint to less than Carbon Neutral, so that the entity’s [operations/activities] have a net effect of removing carbon dioxide from the atmosphere rather than adding it.

Drafting notes

Several drafting options are included as the term “Carbon Negative” is currently not widely used and there is not yet an agreed methodology for calculating if a product or activity is Carbon Negative in the same way as there is for Carbon Neutral. Which definition to use will depend on the subject and purpose of the clause being drafted. Issues to consider include:

  • Are you requiring an entity to be Carbon Negative?
  • Is an entity committing to be Carbon Negative?
  • Do you require an entity to only use Carbon Negative technology or to produce a Carbon Negative product? 

These drafting options will be clarified and consolidated based on feedback from users.

Note that the term “Carbon Positive” is used by some organisations instead of Carbon Negative to avoid the use of the word negative when describing their work to reduce their GHG emissions. For clarity and consistency, across the clauses in our Climate Contract Playbook and Green Papers of Model Laws, TCLP encourages the use of “Carbon Negative”.

Application

Supply chain clauses, national climate laws, green leases (where the premises being leased are to be carbon negative), project finance documents (e.g. loan, guarantee and recourse agreements, engineering, procurement and construction contracts), policy documents.