Climate Jargon You Need To Understand

Here is a list of commonly used terms you will encounter in the news, government regulations and climate reports. Use this handy jargon guide to help you when you are getting started and to help with planning, implementing, and communicating your climate action strategy.

General Climate & Policy Terms

• Climate - Climate broadly refers to the average weather conditions in a region typically averaged over 30 years but other periods may be used depending on the purpose. The big difference between climate and weather is the length of time involved. Weather can change hour-to-hour, day-to-day.

• Greenhouse Gas (GHG) - Any gas that absorbs infrared radiation in the atmosphere. Greenhouse gases include, but are not limited to carbon dioxide, methane, nitrous oxide, ozone, hydrofluorocarbons, perfluorocarbons, sulphur hexafluoride, and water vapour.

• Climate Action - Climate action refers to efforts taken to combat climate change and its impacts. These efforts involve reducing greenhouse gas emissions (climate mitigation) and/or taking action to prepare for and adjust to both the current effects of climate change and the predicted impacts in the future (climate adaptation).

• Mitigation - Actions to reduce or prevent the emission of GHGs (e.g., switching to renewable energy).

• Adaptation - Adaptation refers to actions to deal with the expected impacts of climate change and involves taking practical actions to manage risks, protect communities and strengthen the resilience of businesses and the economy.

• Resilience - The capacity of a system (social, economic, environmental) to withstand or recover from climate impacts.

• Paris Agreement – 2015 treaty committing countries to limit global warming to well below 2°C, preferably 1.5°C.

• Nationally Determined Contributions (NDCs) – Climate action plans submitted by countries under the Paris Agreement.

• COP (Conference of the Parties) – Annual UN climate summit where progress and new commitments are negotiated.

• UNFCCC – United Nations Framework Convention on Climate Change, the main international climate treaty (1992).

• EU Green Deal – EU’s growth strategy to reach climate neutrality by 2050.

• Fit for 55 Package – EU policy package aiming to reduce GHG emissions by 55% by 2030 (compared to 1990).

• Carbon Border Adjustment Mechanism (CBAM) – EU policy applying a carbon price on imported goods to prevent carbon leakage.

• Just Transition – Ensuring climate action is socially fair, protecting workers and communities during the transition.

Greenhouse Gas Accounting

• The Greenhouse Gas (GHG) Protocol is a widely used international accounting framework for measuring and managing greenhouse gas emissions. Developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), it provides standards, methodologies, and tools for organizations to track their carbon footprint. (Greenhouse Gas Protocol)

• Carbon Footprint – Total GHG emissions linked to an entity, product, or activity.

• Scope 1 Emissions – Direct emissions from owned or controlled operations. (Greenhouse Gas Protocol)

• Scope 2 Emissions – Indirect emissions from purchased electricity, steam, heating, or cooling. (Greenhouse Gas Protocol)

• Scope 3 Emissions – All other indirect emissions across the value chain (suppliers, customers, logistics, waste) (Greenhouse Gas Protocol)

• Baseline Year – Reference year for measuring emission reductions.

• Net Zero – For businesses, net zero means cutting greenhouse gas emissions, including reducing emissions across the entire value chain, to as close to zero as possible with any remaining emissions offset by CO2 re-absorbed from the atmosphere by forests or other carbon capture methods.

• Carbon Neutral – Businesses become carbon neutral when they calculate their greenhouse gas emissions and compensate for what they have produced via carbon offsetting projects (often used interchangeably with net zero, though less stringent).

• Carbon Negative (Climate Positive) – Removing more emissions than are generated.

• Carbon Intensity – Emissions per unit of output (e.g., per kWh, per revenue).

• Residual Emissions – Emissions that remain after all technically and economically feasible reductions.

• Fugitive Emissions - These are greenhouse gas emissions (gases or vapours) from pressurised equipment due to leaks and other unintended or irregular releases, often occurring in industrial, business and domestic activities such as oil and gas production, chemical manufacturing, refrigeration, and air conditioning. Fugitive emissions can include methane leaks, refrigerant gases, and other greenhouse gases that escape into the atmosphere.

• Carbon Equivalent (CO2-eq or CO2e): A metric measure used to compare the emissions of the different greenhouse gases (GHG) based upon their global warming potential (GWP) over a set period of time (usually 100 years). It is used to convert all the different greenhouse gases to a carbon dioxide equivalent . Along with carbon dioxide (CO2) from burning fossil fuels, business are responsible for emitting many of these gasses such as leaks of refrigerant gases from refrigerators or air conditioning, methane from food production and decomposing waste or nitrous oxide from fertilisers. Their effect can range from 25 times to over 3000 times more warming potential than CO2 emissions.

•  Carbon Footprint - The total greenhouse gas (GHG) emissions directly and indirectly caused by individuals, businesses and other organisations. It is calculated by adding up the greenhouse gas emissions resulting from every stage of a product or service's lifetime including its resource extraction, manufacture, use, and its end-of-life.

•  Carbon Handprint - For businesses carbon handprint measures the positive impact of a product on the environment. It recognises the actions you take to have a positive impact on the climate, over and above reducing your carbon footprint. It can be considered the opposite of a carbon footprint. A carbon handprint assessment calculates the beneficial greenhouse gas impacts of a product when used by a customer.

• Carbon Leakage - Carbon leakage occurs when one country’s carbon emissions are lowered and it results in another country’s emissions being increased. This can happen when production moves from one country to another. The overall result is that the world as a whole does not experience a decrease in emissions.

• Climate Positive: Climate positive means that the total emissions of a company are less than they emit into the atmosphere. Businesses can operate as climate positive by removing carbon or avoiding emitting to begin with.

  Climate Neutral: Climate neutral is essentially the same as climate positive, meaning the climate impact is zero. Companies that are climate neutral reduce their emissions to zero and end all practices that contribute to environmental degradation, excess waste, and resource depletion.

•  Carbon Negative - Carbon negative means that the total carbon emissions of a company fall below zero. If a company is carbon negative, they don’t emit into the atmosphere at all and they engage or invest in additional global emission-reducing activities.

•  Carbon Offset - Carbon offsets allows for companies to continue to release greenhouse gas emissions into the atmosphere but still technically meet their emissions targets through tree planting or investing in forest restoration projects.

•  Carbon Offsetting - Carbon offsetting is a carbon trading mechanism that enables entities to compensate for offset greenhouse gas emissions by investing in projects that reduce, avoid, or remove emissions elsewhere. Carbon offsets are tradable “rights” or certificates linked to activities that lower the amount of carbon dioxide (CO2) in the atmosphere. When an entity invests in a carbon offsetting program, it receives carbon credit or offset credit, which account for the net climate benefits that one entity brings to another.

• Carbon Sequestration and Storage - Carbon sequestration is the process of capturing and storing atmospheric carbon dioxide. Storage in deep geological formations is also known as 'geo-sequestration'.

• Greenhushing - Greenhushing is withholding information on climate strategy for fear that releasing it will bring some form of reputational risk. For some, it's a way to avoid accusations of greenwashing. For others, it's a sign that an organisation is already greenwashing.

• Carbon Budget - A carbon budget measures how much carbon equivalent emissions (CO2-eq) is produced by industry, homes and all other parts of the economy to calculate by how much emissions must be cut in the future. A carbon budget is how some countries set a limit in policy or law on how much greenhouse gases they emit over a fixed time.

• Carbon Credits - Carbon credits are permits that allow the owner to emit a certain amount of carbon dioxide or other greenhouse gases (GHGs). One carbon credit represents a reduction, avoidance or removal of one metric tonne of carbon dioxide or its carbon dioxide-equivalent (CO2-eq).

• Carbon Sink - A carbon sink is a natural or artificial reservoir like trees, peat bogs or oceans. A carbon sink soaks up and stores carbon dioxide removing it from the atmosphere.

• Carbon Tax - A carbon tax is a tax levied on the carbon emissions from fossil fuels. Carbon taxes are intended to make visible the hidden social costs of carbon emissions. They are designed to reduce greenhouse gas emissions by essentially increasing the price of fossil fuels.

Regulatory & Reporting Frameworks

• EU Taxonomy: - A classification system defining which economic activities are environmentally sustainable.

• CSRD (Corporate Sustainability Reporting Directive) - EU regulation requiring large and listed companies to disclose sustainability and climate-related information.

• ESRS (European Sustainability Reporting Standards) - Detailed standards for implementing CSRD.

• TCFD (Task Force on Climate-related Financial Disclosures) - A framework for companies to disclose climate-related financial risks and opportunities.

• SFDR (Sustainable Finance Disclosure Regulation) - EU regulation requiring financial market participants to disclose sustainability risks and impacts.

• Carbon Border Adjustment Mechanism (CBAM) - EU policy applying a carbon price on imports of certain goods to prevent carbon leakage.

• Emissions Trading System (EU ETS) - The EU’s cap-and-trade scheme for GHG emissions, where companies trade emission allowances.

• Voluntary Sustainability Standards (VSME) for SMEs - Developed by EFRAG, the VSME aims to standardise ESG data requests, reducing the burden on smaller companies and improving their access to lenders, investors, and clients. Companies can use the VSME standard alone or in combination with other best practices for disclosures.

• EU Taxonomy – Classification system defining what activities are environmentally sustainable.

• Double Materiality – Reporting both how sustainability issues affect a company (financial materiality) and how the company affects society/environment (impact materiality).

• EU Climate Law – Makes the EU’s 2050 climate neutrality target legally binding.

• Energy Efficiency Directive (EED) – EU legislation to improve energy efficiency.

• Renewable Energy Directive (RED II/III) – EU legislation setting renewable energy targets.

Targets & Strategies

• Science-Based Targets (SBTi) – Corporate climate targets aligned with climate science (1.5°C or well below 2°C).

• Decarbonisation Pathway – Roadmap showing how an organization will reduce emissions in line with targets.

• Decarbonization Pathway - A roadmap for reducing emissions in line with science-based targets.

• Carbon Offsets - Credits representing emission reductions achieved outside of an organization, used to compensate for emissions elsewhere.

• Carbon Insetting - Emission reduction projects implemented within a company’s own supply chain.

• Double Materiality - EU concept requiring companies to report both on how sustainability issues affect them (financial materiality) and how they impact society/environment (impact materiality).

• Transition Plan - A corporate strategy detailing how an organization will move toward net zero and align with climate policy.

• Avoided Emissions – Emissions prevented by using a lower-carbon alternative.

• Absolute Emissions – Total GHG emissions measured in tonnes of CO2e.

• Relative Emissions – Emissions intensity compared to an activity metric (e.g., per passenger-km).

• Real Zero - Real zero or “true zero” means that zero emissions are created or released.

Market Mechanisms & Finance

• Carbon Pricing – Charging emitters for CO2 emissions, via carbon taxes or trading.

• Carbon Tax – Direct price on emissions.

• Emissions Trading System (ETS) – Cap-and-trade scheme where companies buy/sell emission allowances.

• EU ETS – EU’s main carbon trading system, covering power, industry, and aviation.

• Allowance (EUA) – A permit giving the right to emit one tonne of CO2 under EU ETS.

• Carbon Credits – Certificates representing avoided or removed emissions, tradable on voluntary markets.

• Additionality – Principle that a carbon project must achieve reductions beyond what would have happened anyway.

• Double Counting – Incorrectly claiming the same emission reduction more than once.

• Green Bonds – Bonds financing projects with environmental benefits, including climate mitigation.

• Sustainable Finance – Integrating ESG and climate considerations into investment and lending decisions.

Risk, Resilience & Adaptation

• Physical Risks – Climate-related risks from extreme weather, flooding, sea level rise, etc.

• Transition Risks – Risks from policy, market, or technology changes during the shift to a low-carbon economy.

• Liability Risks – Legal risks from failure to act on climate issues.

• Climate Resilience – Ability to withstand and recover from climate shocks.

• Adaptation – Adjustments to reduce vulnerability to climate impacts.

• Nature-Based Solutions (NbS) – Using ecosystems (e.g., wetlands, forests) to mitigate or adapt to climate change.

• Biodiversity Loss – Decline in species and ecosystems, increasingly tied to climate risk reporting.

Energy & Technology

• Renewable Energy – Energy from both natural and renewable sources (solar, wind, hydro, geothermal, biomass).

• Guarantees of Origin (GoO) – EU certificates verifying electricity comes from renewable sources.

• Renewable Energy Certificates (RECs) – Similar certificates used in US and global markets.

• Energy Efficiency – Reducing energy consumption for the same output.

• Electrification – Switching from burning fossil fuels directly, as a transport and heating source, to using electricity (e.g., EVs, heat pumps).

• Carbon Capture, Utilization and Storage (CCUS) – Capturing CO2 for storage underground or reuse in products.

• Green Hydrogen – Hydrogen produced using renewable energy, with no CO2 emissions.

• Blue Hydrogen - Hydrogen produced from natural gas, where the carbon dioxide (CO2) emissions produced during the process are captured and stored. Blue hydrogen is often referred to as a “low carbon” solution as 10-20% of the generated carbon cannot be captured.

• Black, Brown, Grey Hydrogen - Grey hydrogen is the most common form and is generated from natural gas, or methane, through a process called “steam reforming”. This process generates just a smaller amount of emissions than black or brown hydrogen, which uses black (bituminous) or brown (lignite) coal in the hydrogen-making process. Black or brown hydrogen is the most environmentally damaging as both the CO2 and carbon monoxide generated during the process are not recaptured.

• Biofuels - Biofuels are liquid, or gaseous fuels such as biodiesel and bioethanol, made from biomass. They can serve as a renewable alternative to fossil fuels.

• Biomass - This is plant or animal material like wood and food waste. It can be used as a source of fuel. Common types of biomass are wood (including pellets) and agricultural products, solid waste, landfill gas and biogas, and alcohol fuels (like Ethanol or Biodiesel).

Disclosure & Standards

• TCFD (Task Force on Climate-related Financial Disclosures) – Framework for reporting climate-related financial risks.

• ISSB (International Sustainability Standards Board) – Global sustainability disclosure standards, including climate.

• GHG Protocol – Widely used standard for measuring and reporting greenhouse gas emissions.

• CDP (Carbon Disclosure Project) – Platform for companies and cities to disclose climate data.

• GRI (Global Reporting Initiative) – Sustainability reporting framework used globally.

Technical & Sector-Specific

• Renewable Energy Certificates (RECs/GoOs in EU): Instruments verifying that energy purchased comes from renewable sources.

• Carbon Pricing: Market-based mechanisms to charge emitters for CO2 emissions, including carbon taxes and trading systems.

• Circular Economy: An economic system focused on reducing waste, reusing resources, and extending product lifecycles. The circular economy is a model of production and consumption, which involves sharing, leasing, reusing, repairing, refurbishing and recycling existing materials and products as long as possible. In this way, the life cycle of products is extended.

• Nature-Based Solutions (NbS): Actions to protect, sustainably manage, and restore ecosystems to address climate and societal challenges.

• Carbon Capture, Utilisation and Storage (CCS & CCUS): Technologies that capture CO2 emissions for storage underground or reuse in products.

• Circular Economy – Economic model focused on reuse, recycling, and resource efficiency.

• ITAD: ITAD or IT Asset Disposition refers to the responsible disposal of IT assets at the end of their lifecycle, including computers, servers, mobile devices, and other electronic equipment. Instead of disposing of these assets in landfills, ITAD providers can refurbish, remanufacture, resell, or recycle them, extending their useful life and reducing waste.