COP26 Net Zero Atlas by FTSE Russell, leverages an in-house analytical tools – originally developed to assess climate risk for sovereign assets in fixed income markets – to evaluate the ‘temperature alignment’ of national climate commitments for G20 countries in a systematic, rigorous manner.
The firm calculates the implied temperature rise (ITR) associated with individual national climate goals. This provides a consistent (if highly stylized) metric to assess alignment with different global warming trajectories and to systematically compare climate commitments across countries and over time.
FTSE Russell applies this methodology to climate commitments of G20 countries for 2050 based on their Net Zero targets and for 2030 both for their NDCs and for their ‘Current Policies’. The latter present emissions projections that have been developed in an associated research project led by researchers from IIASA and the NewClimate Institute, under the assumption that current national climate policies would stay in place unaltered.
With multiple policies, targets and ambitions being formulated and revised by countries at different stages of economic development, taking stock on global mitigation efforts has become a daunting exercise. That greater efforts are required is clear, but who is leading and who is lagging? Are the new Net Zero targets consistent with the Paris Agreement? Are the revised NDCs in turn consistent with their Net Zero Targets? And are countries’ current policies really on track to achieve 2030 commitments and 2050 goals?
COP26 Net Zero Atlas is clearly showing that the ambition of the current national Net Zero targets would on average lead to a global temperature rise of 2.1°C , well above a 1.5°C trajectory.
“This analysis shows that while much progress has been made since Paris, national commitments in aggregate could still fall short of the scale and pace of change required, with countries’ current policies aligning with a 3°C global warming trajectory, double that of the Paris agreement.
This has major implications for investors and underlines once again the urgency in redoubling global climate efforts and the importance of COP26 negotiations in safeguarding the well-being and prosperity of future generations.”Arne Staal, Group Head of Benchmarks & Indices, CEO FTSE Russell
COP26 Net Zero Atlas is available here.
Source: FTSE Russell