Most Airlines Not Aligned with Paris Agreement

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    Stockholm (NordSIP) – The Transition Pathways Initiative (TPI) published its latest assessment of the transport sector.

    The report surveyed 57 companies in automobile manufacturing, airlines and international freight shipping. The coverage of automobile manufacturers and airlines increased vis-à-vis last year, and the report included shipping companies for the first time this year.

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    Transport’s Management Quality Improves But Shipping Lags Behind

    TPI assesses companies’ management of greenhouse gas emissions through its Management Quality Score, which rates companies across five levels of climate change risk integration. According to the report, only two transport companies (Brilliance and Qatar Gas Transport Co) are on Management unaware of or not acknowledging climate change as a business issue (Quality Level 0). Close to 60% of transport companies are on Level 3, integrating climate change into operational decision-making, or Level 4, the top level where companies are conducting a strategic assessment of climate change.

    On average, the transport sector is just over halfway between Level 2 and Level 3. Transport companies appear to be implementing disclosure of operational GHG emissions and setting emissions reduction targets, after which they will have reached Level 3 requires.

    Of the three transport sub-sector, auto companies have the best Management Quality. Airlines are in line with the transport sector average. However, according to TPI, shipping ranks on part with coal mining as on one of the laggard industries on Management Quality.

    Overall, there has been an improvement in transport’s Management Quality with over one-third of companies moving up at least one level over the last 12 months. However, TPI reports most companies quality remained stagnant between levels 0-3, while 7% of companies fell one level.

    Carbon Performance

    The initiative also reports on a measure of Carbon Performance, assessing the alignment of company targets with the UN Paris Agreement goals. The system considers three levels. Companies described as Paris/International Pledges, have a performance consistent with emissions reductions pledged by countries as part of the Paris Agreement. Companies described as aligned with the 2 Degrees (Shift-Improve), consistent with the overall aim of the Paris Agreement, albeit at the low end of the range of ambition. 2 Degrees (High Efficiency) is a variant of the previous scenario that assumes there is no shift in passengers to lower-carbon modes of transport. In this more advanced scenario, all emissions reductions are delivered through increased fuel efficiency and low-carbon technology.

    According to the analysis conducted, 35% of companies are aligned with the least ambitious Paris/International Pledges benchmark and 19% are aligned with a path to keep global warming at 2C or below. These shares are slightly higher than the rest of the TPI database, but sub-sector performance varies substantially.

    Over two-thirds of the 13 international freight shipping companies assessed by TPI  are already aligned with a Below 2C benchmark for 2030. However, the report warns that the sample it considers includes the largest companies with the most efficient vessels, which may be biasing their results.

    The situation in the airline industry is much direr. According to the report, 80% of the companies surveyed are not aligned wt the 2C goal for 2030. Only two airlines (Easyjet and Wizz Air) are expected to be aligned with the least ambitious International Pledges benchmark by 2030.

    55% of the largest 22 automobile manufacturers – including BMW, Honda and Ford – are still not aligned with the Paris goals. The remaining nine auto manufacturers are aligned with the goals, which represents a 29% increase in alignment compared to last year. Of those nine, only Daimler and Tesla are aligned with either of the 2C benchmarks.

    Featured image by Skycolors ©Shutterstock

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