SBTi V2: anticipating the 2035 Removal Mandate for a corporate portfolio

V2.0 is the first successor to the 2021 Corporate Net-Zero Standard. 1.5 °C-aligned targets, scope 1+2+3 perimeter, net-zero by 2050 at the latest: that frame does not change. What changes is the role of carbon credits.

Two new mechanisms in V2:

• The Ongoing Emissions Recognition (OER), a voluntary three-tier recognition open from 2027. The formalised successor to what the drafts called BVCM.
• The Removal Mandate, mandatory for Category A companies (large corporates above SBTi's emissions or revenue thresholds). It requires covering with removal credits a growing share of scope 1+2+3 emissions from 2035, on a linear ramp to 100% by the corporate net-zero year, at the latest 2050.

OER is how a company tells its climate story. The Mandate is what a company holds in its portfolio.

OER has three recognition tiers, in ascending order:

• Engaged: 1% of ongoing emissions covered.
• Advanced: 100% of scope 1+2 and 10% of total.
• Leadership: 100% of everything, USD 80 per tCO2e reference budget.

All three tiers accept removal, reduction and nature-based protection credits: the filter is broad.

One important point that is often misread: OER never reduces the reported inventory. Voluntary contribution is accounted for separately, never netted against scopes 1, 2 or 3.

The Removal Mandate is narrower. Removals only, avoidance credits explicitly excluded. Linear ramp from 1% in 2035 to 100% by the net-zero year. And inside it, a second constraint: at least 10% of those removals must be long-lived from 2035, on the same ramp to 100% long-lived by net-zero year.

Long-lived, in SBTi's sense, means storage in centuries to millennia. The text names direct air capture with geological storage, and mineralisation. Everything else (nature-based, biochar without geological storage, most soil projects) is short-lived: decades to centuries. A future Call for Evidence may reopen the question of equivalence between the two categories, probably not before 2028.

This long-lived / short-lived distinction is the pivot point for any portfolio dominated today by nature-based. Carbon sequestered in agricultural soil under Gold Standard SOC 402.3, Verra VM0042 or CRCF-agriculture methodologies holds for several decades with a collective buffer around 20% and 20 to 40 years of post-programme monitoring. That places it in the short-lived removal category in SBTi's sense.

Eligible for OER at all three tiers without restriction. Eligible for the Removal Mandate, but only for the short-lived share: 90% of the 1% in 2035, a share that decreases each year as long-lived rises towards 100%.

SBTi names no private standard in the text. The credit just has to clear the Verified Mitigation Outcome filter: ex-post issuance, independent third party, documented additionality, reversal safeguards, retirement on a public registry. Gold Standard SOC 402.3 clears it without discussion, so does Verra VM0042 v2.2. ISO 14064-2 cohorts depend more on the registry actually used at retirement, to check case by case with the seller.

Concretely, European soil carbon does not become obsolete. It stays in the eligible portfolio. But it will not, on its own, cover the full obligation at net-zero year.

Take a European company with a net scope 1+2+3 of 10 MtCO2e per year after already-committed reductions. An SBTi-validated net-zero for 2040. It currently buys around 500 kt per year of carbon credits, a nature-based mix with a few technical removals sprinkled in.

By 2035, the SBTi ramp requires 1% of scope 1+2+3 in removals: 100 kt per year. At least 10 kt of that long-lived. The rest (90 kt) can be short-lived: European soil carbon, certified reforestation, biochar without geological storage.

By 2040, net-zero year: 100% of net residual emissions. Say 3 MtCO2e per year after the reductions committed between 2035 and 2040. All long-lived. A technical-removal pipeline moving from 10 kt in 2035 to 3,000 kt in 2040. A 300-fold increase in five years.

A buyer waiting until 2035 to structure its first DAC or mineralisation offtakes will have missed the window. Technical projects run 5 to 8 years of development lead time, a global annual capacity far below projected demand, and prices that rise with scarcity. The decision is made now, not in ten years.

The same buyer can, in parallel, keep leaning on soil credits for the short-lived share, right up to net-zero year. They stay OER-eligible until 2035, then Mandate-eligible on a declining share. Their use value does not disappear. Their role changes: from the primary carbon asset to the short-lived floor of the target portfolio.

Two distinct tracks, opened in parallel not sequentially.

Workstream 1: consolidate the European short-lived removal base. Soil carbon under Gold Standard SOC 402.3, Verra reforestation, a few agricultural biochar niches. A stable pillar, eligible for the entire short-lived Mandate share. Agronomic and biodiversity co-benefits. CRCF alignment. Clean ESRS E1-7 narrative. The catch: do not overpay for short-lived hoping it will cover long-lived later. It will not.

Workstream 2: build the long-lived pipeline. From 2026 already, sign multi-year offtakes on DAC with geological storage, mineralisation via enhanced weathering or basalt, potentially biochar with geological storage if it gets reclassified long-lived (SBTi has hinted at a possible reframing). Volumes available in 2026 stay thin, hundreds of kt per year globally, but developers are gradually opening tranches for 2028-2032 delivery. That is where the competitive positioning plays out. A 2026-2027 ticket locks in 2030-2040 deliveries on terms that will not be 2035 terms.

V2 makes credit procurement more strategic. On the contracts you sign today for 2028-2035 delivery (multi-year offtakes or spot buys), three points are worth writing plainly into the paperwork.

SBTi eligibility. Explicit statement of the intended classification (long-lived or short-lived), warranty that the delivered credit qualifies as a Verified Mitigation Outcome under V2, renegotiation clause if SBTi later tightens the criteria. Without that, a credit that looks eligible in 2026 can turn disqualified in 2035, with no recourse.

Retirement traceability. SBTi insists on ex-post third-party assurance and retirement on a public registry. An ISO 14064-2 credit verified by a reputable VVB but retired on an unlisted registry may not clear. The recognised public registries that come up most often: Gold Standard, Verra, CRCF, ART TREES, Puro. The target registry name should be set at signature.

Additionality and reversal safeguards. The Mandate implicitly tightens the criteria. Documented baseline, no business-as-usual, structured buffer pool, contractually defined monitoring. On soil carbon, these are in place with any serious developer. On biochar or DAC, it is producer by producer and belongs in the due-diligence file.

Soil carbon is not devalued. V2 confirms, formally, that nature-based removals have a legitimate place in an SBTi strategy: OER from 2027 across all three tiers, short-lived share of the Mandate from 2035. A portfolio dominated today by European soil carbon does not need dismantling, it needs completing. A pivot to 100% technical tomorrow is not required by the text.

The 2035 Mandate does not apply to every company. It applies to Category A companies, set by SBTi's emissions or revenue thresholds. An SME, a mid-cap or a Category B company keeps broader flexibility. If you are unsure of your status, get it confirmed by your SBTi Target Validation Team before sizing your portfolio.

OER does not let you net credits against scopes. The text repeats it: voluntary contribution is accounted for separately, never netted against the reported inventory. A marketing team presenting an OER purchase as an emissions reduction would be in direct violation of the SBTi text, and in the red zone with the European ECGT directive once it applies in September 2026.

In short, on soil carbon: V2 clarifies its role in a net-zero strategy, it does not question it. The text sets, at the same time, a horizon (2035, 2040, 2050) that makes parallel work on long-lived indispensable. It is a reframing, not a break.