The signing of the Paris Agreement by 174 nations on Earth Day this year was a momentous step in tackling climate change. Of course, we’ll have to see how individual governments translate intentions into actions. Fortunately, companies aren’t waiting to cut greenhouse gas emissions.
Indeed, businesses worldwide will reduce their greenhouse-gas emissions substantially by 2030, predicts a first-ever report, “The Business End of Climate Change,” issued in late June by CDP (formerly the Carbon Disclosure Project), London, and We Mean Business, Washington, D.C., which is a consortium of organizations. The study estimates that businesses taking part in five current initiatives will cut their emissions by 3.2–4.2 billion metric tons of CO2 equivalent/yr (mtCO2e/yr) by then. However, these initiatives potentially could lead to much larger reductions — as great as 10 billion mtCO2e/yr by 2030, states the report.
The five initiatives — and the specific commitments to limit climate change made by participating companies — are:
• Science-Based Targets — setting emissions-reduction targets based on keeping temperature change below 2°C;
• EP100 — over 25 years doubling economic output from each unit of energy;
• RE100 — using 100% renewable electricity;
• Zero Deforestation — employing no commodities that cause deforestation; and
• Low Carbon Technology Partnership — developing and adopting low carbon technology in their industry. (The various sectors involved include the chemical industry.)
At the moment, about 300 companies have joined one or more of these initiatives, notes the report. By 2030, the roster could grow to around 4,500 firms, it adds.
The report’s estimate (developed by the NewClimate Institute, Cologne and Berlin, Germany) of a 3.2–4.2-billion mtCO2e/yr reduction is based on each initiative meeting its most ambitious goal for signing up members; the figure takes into account potential overlaps in savings among initiatives. The 10-billion mtCO2e/yr decrease comes from considering the impact if all relevant companies that could join an initiative did so.
A10-billion mtCO2e/yr reduction would serve as a significant step to keep emissions below the 42-billion mtCO2e/yr limit for 2030 to hold global warming below 2°C, states the report. “But that can only happen if governments create the right policy environment. That means acting as a catalyst and also removing barriers that currently stop companies from fighting climate change,” it warns. “Companies may be highly motivated to take action on climate change but run into obstacles. For example, they could find regulation prevents them from shifting to a lower-emissions supply chain or infrastructure,” it explains.
So, the report calls upon governments to:
• encourage utilities to offer renewable energy contracts and facilitate businesses adopting them;
• help companies build their own renewable electricity installations;
• support research and development on low carbon technologies;
• make energy-efficiency investments more attractive by offering grants and capital depreciation;
• create incentives for buyers and sellers of sustainable products; and
• reduce the administrative and cost burden of certification for producers, so they more easily can produce commodities without deforestation.
CDP and We Mean Business plan to issue the report annually. They hope to include additional initiatives in the future, and are looking for suggestions about ones to consider.
Knowing the potential impact of various initiatives certainly seems a sensible step to understanding the role business can play in curbing greenhouse-gas emissions.