More than half of the world’s top fossil fuel producers will fail to meet climate targets unless they ramp up decarbonisation plans, according to an international team led by The University of Queensland.
An assessment methodology developed by researchers at UQ, Oxford University, Princeton University and the Climate Accountability Institute has tracked the companies’ compliance with the Paris Agreement using publicly available data.
Dr Saphira Rekker from UQ Business School said more than 60 per cent of the top 142 oil, gas and coal companies weren’t aligned with targets to limit global warming to 1.5°C above pre-industrial levels.
“We assessed the companies’ outputs since 2014 and found they were on track to exceed Paris compliant production of oil by 42 per cent, gas by 53 per cent and coal by 68 per cent by 2050,” Dr Rekker said.
“Of the five Australian companies we assessed in the study, two are currently within production budgets across the fossil fuels they produce.”
The production budgets were set by translating scenarios consistent with the Paris Agreement to a company level, determining the amount of fossil fuels they could produce to be compliant.
“Phrases like ‘Paris aligned’ and ‘Paris compliant’ are being thrown around everywhere right now,” Dr Rekker said.
“But if we don’t have a robust and reliable way of assessing progress, those phrases don’t actually mean anything.
“Our goal is to help everyone understand the climate targets the companies have set, whether they align with the Paris Agreement, and the underlying assumptions that go with those targets, such as needing technologies like carbon capture and storage.”
The findings of the study come at a time where countries all around the world are considering the adoption of the ISSB standards relating to climate disclosures.
Dr Belinda Wade, an Adjunct Associate Professor from UQ Business School, said we were seeing a significant focus on corporate transparency around climate targets and action.
“Stakeholders need tools to enable them to easily examine true corporate performance against the Paris Agreement goal,” Dr Wade said.
Dr Chris Greig from Princeton University’s Andlinger Center for Energy and the Environment agreed, noting that companies often announced climate targets but then continued with business as usual.
“When you make a commitment, you should have a credible plan to deliver; however, it’s clear from our work that the paths several companies are taking fall very short of their pledges,” Dr Greig said.
The researchers’ new method expands on their original approach, which measured the Paris compliance of utility and cement companies using a science-based test.
Dr Matthew Ives from the Institute for New Economic Thinking at the Martin School, University of Oxford, said the fossil fuel method would make it more difficult for companies to get away with greenwashing.
“Some existing approaches have used metrics like carbon intensity that rely on difficult-to-source and often misleading data,” Dr Ives said.
“Other approaches have enabled companies to choose their own starting point for tracking progress, allowing them to erase unflattering historical emissions.
“With our approach, anyone and everyone can evaluate fossil fuel companies for their Paris compliance – it’s much more straightforward.”
Dr Rekker said there were many pathways to Paris compliance, so the aim of the research wasn’t to lecture the companies and sectors studied about the right and wrong ways to operate.
“Our tool also gives executives and other stakeholders a sense of the transition and reputational risks they might face if they overshoot their production budgets and don’t course correct,” she said.
Companies, policymakers, shareholders and the public can visit the researchers’ Are You Paris Compliant website to access the company ratings and assessment tools.
The study is published in Nature Climate Change.
Read more at The Conversation: Nearly two-thirds of the top fossil fuel producers in Australia and the world aren’t on track for 1.5℃ climate target
Media: Dr Saphira Rekker, s.rekker@business.uq.edu.au, +61 406 883 298; Alysha Hilevuo, communications@bel.uq.edu.au, +61 409 612 798.
