2025 Valero Report on Guiding Principles - Flipbook - Page 19
Introduction
Safety
Environment
Community
Indirect GHG emissions from the consumption of
energy and steam purchased by the organization for
its use (also known as Scope 2): to calculate Scope 2,
we follow the guidance from two approaches in the
GHG Protocol: market-based and location-based. We
calculate Scope 2 for our three segments: re昀椀ning,
ethanol and renewable diesel.
Scope 1 Intensity: to calculate the GHG emissions from
the re昀椀nery process per unit of throughput, we divide
the global re昀椀nery Scope 1 in million metric tons CO2e
(as described above) by thousand BOE. Re昀椀ning peer
group includes PSX, MPC, DINO and PBF. Similarly, we
calculated peers' Scope 1 intensity by dividing re昀椀ning
Scope 1 by re昀椀ning throughput, as disclosed in public
昀椀lings, such as annual reports on Forms 10-K, EPA Flight
Data and sustainability reports. In the absence of 2024
GHG emissions reporting by certain peers at the time
of publishing of this report, we assumed the same
level of GHG emissions as in 2023.
Indirect GHG emissions intensity from the use of
products on a per barrel or per unit of energy basis:
there is not currently a standardized methodology
for calculating Scope 3 GHG emissions, and the
inherent unreliability of Scope 3 calculations renders
such metric of limited value. At Valero, we have
complied with mandated GHG emissions reporting
requirements for more than a decade related to GHG
emissions of the use of our products, as required by
the EPA. Therefore, for the calculation of the numerator
we follow the U.S. 40 CFR Part 98 (Subpart MM), which
includes the complete combustion of each petroleum
product and natural gas liquid produced, used as
feedstock, imported, or exported during the calendar
year, based upon the carbon content of each
material. The numerator includes both the disclosure
from our U.S. re昀椀neries as required under U.S. 40
CFR Part 98 (Subpart MM) and from our re昀椀neries in
Canada and the U.K., in conformance with U.S. 40 CFR
Part 98 (Subpart MM). Because it is a company-wide
reporting, the calculation of this metric includes the
GHG emissions from low-carbon fuels displacement
of petroleum fuels (“displacements”) and the absolute
GHG emissions reductions from CCS, if any.
The denominator in the intensity calculation in kg
CO2e per thousand BOE is the company’s re昀椀ning
throughput, ethanol production and renewable diesel
sales. The denominator in the intensity calculation per
megajoule (MJ) is the total energy from the company’s
re昀椀ning throughput, ethanol production and
renewable diesel sales using energy factors (MJ/gal)
from the California Air Resources Board’s Greenhouse
People
Governance
Appendix
Gas, Regulated Emissions, and Energy Use in
Transportation 3.0 model (CA-GREET3.0 model)
used by California’s Low Carbon Fuel Standard
(LCFS).
Displacements: this represents the tonnage
reduction of GHG emissions equivalent (CO2e)
that result from the substitution of petroleum
fuels with the production of, blending of and
credits from low-carbon fuels, including, but not
limited to, products that we currently produce or
are expected to produce as part of our publicly
available GHG emissions targets (such as ethanol,
cellulosic ethanol, renewable diesel, renewable
naphtha, renewable propane and SPK or neat
SAF), as well as low-carbon fuels we procure,
including ethanol and biodiesel. This calculation
is based on a comparison of low-carbon fuels
LCA and the fossil fuel benchmark LCA, which
could vary depending on the product and/or the
jurisdiction.
For our production of renewable diesel, the CI
estimations are based on the actual marketbased CI assigned to the product from the
veri昀椀cations and audits from jurisdictions where
renewable diesel production was sold. On neat
SAF, the CI calculations are based on the Carbon
Offsetting and Reduction Scheme for International
Aviation (CORSIA) from the International Civil
Aviation Organization (ICAO). In the case of our
production of ethanol, the CI estimations are
based on the Argonne National Laboratory
GREET3.0 2021 model. Regarding the CI estimations
for ethanol and biodiesel that we procured to ful昀椀ll
our blending obligations, we used the Argonne
National Laboratory GREET3.0 2021 (ethanol) and
2019 (biodiesel) models and published papers.
When calculating the displacements from
blending and to avoid double counting, our lowcarbon fuel production that contributes to our
blending obligation is excluded.
Under the Sustainability Accounting Standards
Board's (SASB) Standards Application Guidance
3.0 Reporting Boundaries, as the operator of the
consolidated entity, displacements include the
entire production of renewable diesel, renewable
naphtha, renewable propane and SPK or neat SAF
of the consolidated entities that we operate.
Valero Report on Guiding Principles •
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