One-fifth of companies in the transportation sector will not be able to maintain their carbon emission reduction targets to keep global temperature increases below 2 degrees Celsius when timetables are accelerated in 2030, warn asset owners of the Transition Pathway Initiative, which have £15 trillion ($19 trillion) in assets.
A study 57 of the world's largest transport companies conducted by the initiative in cooperation with the Grantham Research Institute on Climate Change and the Environment at the London School of Economics, showed worst offenders were airline companies.
Carbon emission management score of airlines have improved by more than 8% since the spring of 2019, but the sector remains second worst ahead of only oil and gas in terms of alignment with the global community's stricter benchmarks set for 2030. Each company is expected to further reduce its emissions beyond the original 2020 benchmarks set in the 2015 Paris Agreement.
Almost 60% of the 22 airlines' emission reduction targets are currently aligned with the 2015 Paris Agreement's targets, but beyond 2020 most airlines plan to reduce emissions through offsetting rather than shift to lower-carbon aviation operations, the initiative said.
"Investors will be troubled by stalled climate progress in aviation, and by the sector's reliance on net emissions targets. A dependence on offsetting is not a credible climate strategy given the urgency of making deep cuts in greenhouse gas emissions across all sectors of the economy," said Adam Matthews, co-chairman of the initiative and director of ethics and engagement at the £8.2 billion Church of England Pensions Board, London, in a news release Tuesday.
By comparison, 43% of automotive companies have improved their climate scores this year, with average fleet emissions falling up to 2.5% per year. On carbon performance, 41% of car manufacturers are expected to be in position to align with the Paris targets in 2030.
In addition, some 61% of shipping companies, when considering emissions relative to cargo mass and distance transported, already are aligned with targets for 2030.
