How to improve your CDP score through energy-related disclosure

Figure 1: Overall claim recognition for the entire sample (9,551 companies in 2023 from a total of 23,000) (Source: CDP).

As corporate climate reporting becomes more crucial for businesses worldwide, many companies seek ways to improve their scores in frameworks like CDP. Companies looking to increase their score or maintain an A score can do so through strategic energy-related action and disclosure.

A key challenge in this process is the accurate reporting of renewable electricity sourcing. While companies reported sourcing an average of 29% renewable electricity in 2023, only 16% properly documented sufficient detail regarding the purchasing mechanism and where it was consumed according to CDP’s Corporate Renewable Electricity Sourcing Trends (2024 Snapshot), published in November 2024 (see Figure 1). This discrepancy is often due to incomplete accounting practices, such as failing to follow market boundaries, double-counting, or incorrectly using grid average renewable electricity.

In this article, we’ll explore the role of energy-related reporting in CDP scoring, outline steps to enhance your score, and illustrate how 3Degrees can support organisations in this journey.

How CDP scores are calculated

CDP assigns scores based on three key elements:

Essential criteria: Fundamental requirements that companies must meet to move from one score to another.

Points: These are assigned to each CDP question based on the completeness and quality of responses. The more points an organisation receives, the higher the overall score.

Weightings: Different categories within the CDP questionnaire carry different weights, with more emphasis on forward-looking strategies (e.g., business strategy, targets) and data transparency (e.g., verification).

The final score is determined by (essential criteria) AND (points * weightings).

The essential criteria act as a gatekeeper—if a company fails to meet these baseline requirements, it is automatically restricted to a lower score, regardless of the total points it earned. This means that even a company with a high number of points will not progress to the next score tier unless it meets the required essential criteria.

The role of energy-related disclosure in CDP

Energy-related disclosure plays a significant role in a company’s CDP score. Businesses must accurately report their energy consumption, renewable energy procurement, and fuel sources to optimise their performance.

Figure 2: Graph demonstrating how increasing the share of renewables impacts the final CDP score (source 3Degrees).

In Figure 2, it is shown how energy disclosure impacts the final score, broken down by CDP’s three key elements below:

• Meeting essential criteria: To achieve an A score, companies must fully disclose at least one row on each of its relevant fuel consumption and energy generation (electricity, heat, steam, and/or cooling) in their CDP response.
• Weightings: Energy disclosure accounts for approximately 7.5% of the total CDP score.
• Points: Companies with a higher proportion of renewable energy in their total consumption receive higher scores.

Figure 3: Graph focusing on renewable energy sourcing methods, illustrating the additional CDP scoring benefits of securing high-quality and transparent contracts (source 3Degrees).

Important thresholds include sourcing renewable energy through high-quality, structured contracts like power purchase agreements (PPAs) and virtual PPAs (VPPAs) (see Figure 3). These strategies can significantly improve a company’s score, as they provide more transparency regarding the products purchased and the commissioning year.

Steps to improve your CDP score

In order to improve your score, there are many paths you can take for renewable energy sourcing. In fact, 3Degrees provides tailored solutions designed to align with specific CDP disclosure requirements (see Figure 4). These include:

• Increasing renewable fuel consumption with renewable natural gas (RNG) or biomethane certificates.
• Achieving renewable energy consumption targets through energy attribute certificates (EACs), certificate purchase agreements (CPAs), PPAs, and VPPAs.
• Enhancing transparency in renewable energy sourcing with project-specific contracts and unbundled EACs.

Additionally, we ensure that all energy-related products, such as EACs, green tariffs, or PPAs/VPPAs, include the commissioning year when requested, maximising a company’s CDP scoring potential.

Figure 4: Table summarising how 3Degrees’ products align with the energy-related elements assessed by CDP.

It is important to note that in the absence of accepted third-party verification standards for renewable electricity claims, third-party verification of a market-based scope 2 inventory can serve as a reliable proxy for verifying purchased renewable electricity use (CDP report). This step is strongly recommended, as it enhances data credibility, facilitates year-over-year improvements, and ensures alignment with CDP requirements.

A strategic partner in your CDP journey

At 3Degrees, we help businesses implement renewable energy procurement strategies that align with best practices to optimise CDP scoring potential and contribute to broader decarbonisation and sustainability goals.