No major oil, gas or coal company is on track to align their business with the paris climate goal of limiting the global temperature rise to well below 2c by 2050, new research shows, despite net-zero emissions pledges.
A partnership between london school of economics academics and investors that manage $21tn in funds,called the transition pathway initiative, assessed 125 oil and gas producers, coal miners and electricity groups on their preparedness for a lower-carbon economy.
They were measured on carbon performance, which factors in the carbon intensity of the products they produce and sell, emissions reduction targets and how they would fare under three models: should governments meet existing national emissions pledges, a scenario in which temperatures rise by 2c; and one where they rise by less than 2c.
Of the 59 major oil, gas and coal players assessed, only seven are on track to align with the emissions pledges governments made as part of the 2015 paris agreement royal dutch shell, spains repsol, frances total, eni of italy, equinor of norway as well as miners glencore and anglo american.
But even compliance with existing national pledges would leave the world on track for 3.2c of warming, according to the unep. others say it could be even higher.
Those pledges are widely regarded as insufficient to avert dangerous climate change, tpi said on wednesday.
Only three oil and gas companies shell, total and eni are getting closer to the 2c scenario although their emissions reduction targets and low-carbon investment plans are still not quite enough to bring them into line with that benchmark, let alone lower, tpi said.
Fossil fuel companies have been under pressure from investors and environmental activists to take greater accountability for their role in enabling climate change. several european oil and gas majors, including shell, bp and repsol, have in recent months announced net-zero emissions pledges.
In the new report, bp was not cited as a leader in action on climate change, despite its announcement in august of ambitious plans to cut oil and gas production by 40 per cent over the next decade.
The tpi said the companys new emissions targets for its operations and production covered products made using its own and third-party crude but not those it trades, which made up more than half of everything it sold last year.
Bp said its aims supported its zero ambition, adding that its path was consistent with the paris goals.
A growing divide also exists between those such as bp that prioritise the reduction of absolute emissions versus those including shell and the tpi that focus on carbon intensity which takes into account the amount of greenhouse gas emissions per barrel of oil and gas produced.
Critics of the intensity metric say the measure can fall even if companies continue to expand their production and generate higher absolute emissions, which is what ultimately matters for the climate. others argue that a businesss absolute emissions can fall through asset sales or a commodity downturn without it decarbonising.
Exxonmobil and chevron of the us are doubling down on hydrocarbons rather than seeking to diversify into cleaner business such as their european counterparts.
In the electricity sector, 39 of the 66 utility companies analysed are aligned with the paris pledges, while 22 are in line with the tougher benchmark of below 2c.