FTSE-100 must halve emissions

FTSE-100 companies are falling far short of reducing their emissions to meet target reductions set out in the Climate Change Act, according to figures released from the Climate Disclosure Project (CDP).

Just 24 FTSE-100 companies across the energy, utilities and materials sector are responsible for 87% of all reported emissions from index constituents. The combined average reduction rate between all constituents is just 1.2% per year ­ but the government needs to double that to around 2.4% if it is to have any chance of achieving its 20% target by 2020.

The CDP produced its FTSE-100 Carbon Chasm report in February and set out to evaluate how FTSE-100 companies are working to reduce their emissions. It then compared that information against the UK target of bringing carbon emissions down 20% below 1990 levels.

More ambition
The targets set by the most carbon-intensive sectors, responsible for the majority of FTSE-100 emissions, are not sufficiently ambitious and will not deliver reductions required by the UK Climate Change Act, the report claims.

The CDP has highlighted the need for the government to work with other countries to produce results at home given the international nature of FTSE-100 companies and the sources of their emissions.

“It is crucial that those sectors responsible for nearly 90% of FTSE-100 reported emissions set aggressive reduction targets,” says Paul Dickinson, chief executive of CDP.

“Though we see some individual companies setting strong targets, the sector average reduction targets for the materials, energy and utilities sectors are lagging behind what is required to meet UK government targets. Regulation is sending strong signals to companies of the necessity to manage carbon, but as many of these companies operate globally we also need a strong global framework to create the right incentives to set sufficiently strong targets.”

Useful link
http://tinyurl.com/reductiontarget