The Green Finance Industry Taskforce (GFIT) has identified five sectors as part of its public consultation. These include agriculture and forestry/land use, industrial, waste and water, information and communications technology, and carbon capture and sequestration. The criteria for each sector will be used to determine whether an activity is green or transition in nature. The measures-based approach focuses on implementing a range of emissions reduction measures, regardless of their efficacy in achieving net zero. This includes end-of-pipe technical solutions and process improvements such as energy efficiency upgrades and renewable energy sources.
Furthermore, this approach requires operators to implement associated monitoring systems to track progress against their emissions reduction targets. Therefore, it is essential to consider the “Do No Significant Harm (DNSH)” criteria when assessing activities that substantially contribute to climate change mitigation. The DNSH criteria highlight the need for a balance between economic and environmental considerations, ensuring that any action does not cause significant adverse impacts on other EOs under the taxonomy.