Gaging the credibility of Net Zero Strategies

Gaging the credibility of Net Zero Strategies

A major boost favoring the decarbonization of global economies  

A resounding challenge to a number of corporate and investors’ net zero strategies

In May 2021, the International Energy Agency (IEA) issued the Net Zero By 2050 report, detailing various measures to implement towards achieving carbon neutrality by 2050. This report comes just 2 years after the IPCC demonstrated the abysmal gap in impacts between a 1.5°C and 2°C global warming trajectory. The IEA finally explains concrete actions for major energy-related sectors to limit global warming to 1.5°C. They notably include:

   – An immediate halt to investments across new oil or gas fields and coal mines;

   – An end of sales of gas-fired boilers for buildings from 2025 onwards;

   – By 2030, 60% of car sales worldwide would have to be electric and air traffic will need to be stabilized at 2019 levels.

   – From 2040 onwards, 50% of buildings will have been retrofitted to become carbon neutral; electricity generation will have to completely decarbonized, with solar and wind energy making up the majority of production; 50% of aircrafts that would continue to fly would have to run on low-carbon fuels.

   – By 2050, over 85% of buildings would have to become low-carbon. Between 2020 and 2050, hydrogen production will have to increase fivefold and be gradually decarbonized, in order to reach 100% green hydrogen.

All efforts must be combined for our future net zero society

All of this does not fully address the elimination of all GHG emissions. In parallel, carbon sequestration efforts will also have to be significantly increased. Notably in relations to carbon capture and storage technologies or increasing forestry capacities to capture CO2.  

In short, this report is bound to become a reference tool for any investor, corporation or regulator seeking to assess the climate strategies of economic players. From now on, any net zero pledge must indeed be recalibrated, based on the conclusions of this IEA report. In practice, this report produces a triple threat for economic players and investors to address by:

  1. Taking full measure of their responsibility and impacts. This includes their outsourcing activities and the carbon footprint they typically externalize onto consumers;
  2. Questioning their economic models to justify offsetting activities, but only in the absence of a solid alternative;
  3. Anticipate the legal risk linked to lacking understanding or failing to acting ambitiously enough to meet what the IEA has so precisely documented.

Our team and community of 150+ experts operate across the G20 economies, but also in Africa and South East Asia. Together, they deliver a multi-disciplinary, cross-sectoral and contextual expertise in order to work on these sensitive and complex issues.  

Author of several books and resources on business, sustainability and responsibility. Working with top decision makers pursuing transformational changes for their organizations, leaders and industries. Working with executives improving resilience and competitiveness of their company and products given their climate and human right business agendas. Connect with Farid Baddache on Twitter at @Fbaddache.

A graduate of the CERDI School of Economics, Eléa works at Ksapa as an Analyst and Community Coordinator. She is specialised in Development Economics in emerging countries, with a major in Sustainable Development.

With an affinity for international business, she spent two years in Kuala Lumpur as an exchange student where she worked in a consulting firm on CSR topics and business development.

Involved in several social inclusion and environmental projects, Eléa wishes to contribute to the improvement of environmental and ethical practices within the private sector.

She speaks French and English.

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