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This module assesses the alignment of a company’s generation emissions reductions targets with a well-below 2-degree pathway. To get a complete view of the company’s commitment to and credibility on emissions reductions over time, this module also assesses the time horizon of targets, and the achievement of previous targets.
Given the overall importance of the alignment indicator in this module (12 of the total 20% available), it is unsurprising that the four top-performing companies in this module are the only four to have set targets that are fully aligned with a well-below 2-degree pathway – Ørsted, Enel, AES Corporation and EDP Energias de Portugal. Enel, Ørsted and EDP set their targets through the Science-Based Targets initiative, while AES’ was set internally in 2018 as part of the company’s “Climate Scenario Report”. 23 of the remaining 46 companies have not set any targets or have no targets that reach beyond 2022.
The 50 companies in this benchmark are also lacking when it comes to time horizon of targets. 13 of the 50 companies have targets that cover the majority of their assets’ lifetimes. However, none of these companies have set short-term targets, of no more than five years apart, to incentivise action in the present on their long-term decarbonisation goal. Even AES who tops this module falls short, having only set a 2030 target that covers just 25% of the estimated lifetime of its assets.
The overall picture to emerge from the results of this module for the 50 electric utilities is a clear lack of ambition towards the Paris goals.