World's largest mining companies failing to align with climate goals
Just two of the world's 10 largest mining companies are aligned with limiting climate change to 2°C above pre-industrial levels, the Transition Pathway Initiative (TPI) has revealed today.
Freeport and Grupo Mexico are the two companies already compatible with limiting global warming to below 2°C between now and midway of the century, according to the TPI research.
However, the net-zero ambitions of BHP, Rio Tinto and Vale only cover operational emissions, and as a result, these companies are actually further away from 2°C alignment in 2050 than they are today.
Glencore and Anglo American are currently within the 2°C benchmark, although their emissions pathways are too flat to keep them in alignment by 2050.
The TPI said that some companies have announced more ambitious targets over the last six months, but that firms would need to go “significantly further” to meet investor expectations.
“The sector has made significant progress over the last six months,” said TPI co-chair Adam Matthews. “Several companies have announced new, more ambitious emissions targets, and BHP have acknowledged the role of scope 3 emissions in their future approach.
“TPI’s analysis shows that not all commitments cover all activities and companies will need to go significantly further to meet investor expectations from initiatives such as Climate Action 100+.”
The 10 companies studied have a market capitalisation of over $350bn (£282bn), and contribute to annual carbon emissions of over 1.5 billion tonnes, either directly or indirectly via their products
The researchers said that Fortescue and South32 have yet to set credible long-term targets, and need to cut their overall carbon intensity by nearly 80% by 2050 to claim alignment with 2°C.
With carbon intensity varying widely between commodities, the TPI argued that the most obvious decarbonisation strategy miners can adopt is cutting the production of most carbon-intensive commodities.
It said that coal, particularly thermal coal, presents the biggest opportunity to decarbonise, and that reducing iron ore production presents another opportunity.
“Many assessed companies mine materials that both support the transition and those that do not," Matthews continued. "It is essential that investors have a complete picture of their carbon performance, which includes public targets for scope 3 emissions.”
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Chris Seekings is a reporter for TRANSFORM