The Climate Transition Budget (CTB) is a required component of Climate Label certification. It represents the minimum annual funding a company must commit toward its net-zero transition.

The CTB ensures companies not only set goals, but back them with real, measurable investment in climate solutions.

Get started today by following these steps:

1. Estimate your Climate Transition Budget (CTB)

While your final CTB will be calculated after your 2025 measurement is approved by the TCCP team, we recommend creating an estimated budget now to help with planning. To estimate:

• Review your historical GHG data and add a 15% buffer to adjust for growth over the past year
• Multiply that total by the $15 carbon fee outlined in the 2026 Standard
• Align your estimated budget with your project funding goals and the CTB requirements outlined in the Standard.

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Check out the Fund page in the BEE. Here you’ll see:

• A provisional CTB if your measurement is still in progress
• A final CTB once your measurement is approved </aside>

2. Identify VCA & OC Projects and Get Stakeholder Buy-In

Once you’ve got a clear idea of your Climate Transition Budget, it’s time to identify spending on eligible Value Chain Abatement (VCA) and Other Contributions (OC) projects from the past year or so.

Since the 2026 Standard has defined thresholds for VCA and OC investments, it’s a good idea to focus on these areas first. During certification, you’ll need to submit and get approval for these projects before moving on to BVC projects.

• At least 10% of your CTB must go to VCA projects (minimum required)
  • NOTE:
    • Brands with >$100m in annual revenue that are seeking re-certification and whose revenues are derived primarily from physical products must meet a 20% VCA minimum in 2026.
    • Brands with >$100m in annual revenue that are seeking certification for the first time or whose revenues are derived more than 80% from services activities may meet a minimum VCA allotment of 10% in 2026.
• Up to 15% of your CTB may go to OC projects (maximum allowed)

Whether you already have projects in mind or are starting from scratch, here’s how to approach VCA and OC investments:

1. Review the 2026 Certification Standard and Technical Appendix to understand the requirements for VCA & OC funding.
2. Identify 1–4 potential projects that meet the criteria for each category. For VCA, look at your emissions hotspots and reduction plans to find opportunities. For OC, focus on investments that align with your company’s mission and vision. If helpful, use this CTB Worksheet to estimate your CTB and list potential projects.
3. Add projects to the Fund tab in the BEE to see how your funding is stacking up against the CTB’s min/max thresholds.

💡Pro tip! Check out these resources for more info about eligible project types:

• Tables 5 and 8 in the Standard
• See a list of VCA examples and OC examples
• Investing in a large capital expense project? Keep this policy in mind!

By organizing and prioritizing VCA and OC investments, you’ll set a strong foundation for your certification process while ensuring key stakeholders are aligned every step of the way.

<aside> 📆 Reminder: The VCA portion of the CTB must be allocated and spent within a consecutive four-quarter period, ideally matching the emissions year (i.e. 2025), with clear records of cash flows or accruals. More info about the VCA Period here.

For OC and BVC projects, spending can occur during the emissions year or certification year, but all allocations must be finalized before projects are submitted for certification.

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3. If you plan to invest in BVC projects, contact providers to discuss project options and ensure they meet certification requirements