YPF

YPF has set a target to reduce its scope 1emissions intensity by 10% by 2023. However, this target is not aligned with the rate of change required by the company’s 1.5°C pathway. This unambitious, short-term target fails to drive YPF’s other low-carbon commitments, such as expanding its renewable energy portfolio, and allows for continued growth of fossil fuel production. YPF should endeavour to set long-term targets that are aligned with its 1.5°C pathway for both its scope 1 and 2 and its scope 1, 2 and 3 emissions, along with regularly spaced intermediate targets to incentivize near-term action and hold management to account. .

YPF provides renewable energy through its subsidiary YPF Luz. However, revenues from the sale of renewable energy only represent 0.3% of YPF’s total corporate revenues. YPF is constructing three new wind farms with a total capacity of 297 megawatts (MW). But at the same time it is constructing three fossil fuel power plant projects with a total capacity of 340 MW. YPF’s other low-carbon business activities, namely green hydrogen and solar power generation, are still in the research and development (R&D) stage, and the company has not specified a deployment schedule for these.

YPF Luz supplies electricity to Toyota’s automotive plant and Coca Cola’s bottling plants in the Buenos Aires Province. About 25% of the electricity suppled to Toyota and 40% of the electricity supplied to Coca Cola is renewable energy. YPF Luz plans to increase this supply of renewable energy to 100% to assist these companies in further reducing their scope 2 emissions.

YPF Luz and Toyota also have a strategic partnership to develop joint businesses representing an opportunity to promote low-carbon solutions and mitigation strategies. YPF can strengthen its client engagement strategy by replicating its approach with Toyota with a broader range of clients and influencing them to reduce their greenhouse gas emissions.

YPF’s low-carbon transition plan aims to achieve a 10% reduction in scope 1 emissions intensity by 2023 compared to 2017. As of 2019. the company achieved 79% of this target.

YPF’s low-carbon transition plan comprises a commitment to improve energy efficiency and reduce emissions intensities, particularly methane emissions, in its own operations. The company plans to become the largest generator of renewable energy in Argentina over time, and plans to advance research and development (R&D) in low-carbon activities.

YPF has invested ARS 11.96 billion (USD 248 million) on renewable energy in 2019 and is constructing wind power projects to generate 297 MW of energy on top of the 99 MW that it currently produces. However, this is still a small proportion of YPF Luz’s total power capacity of 1,720 MW. YPF has continued to expand fossil fuel power generation and natural gas production, growing shale by 60% in 2019.

YPF has not significantly changed its fuel mix and the proportion renewable energy incorporated into its sold product mix is too small to have reduced YPF’s scope 1 and 2 and scope 1, 2 and 3 emissions at the rate required by the company’s 1.5°C pathway.

YPF’s emissions reduction targets are short-term and unambitious. Despite commitments towards a low-carbon transition, the company is reliant on fossil fuel growth and plans to expand production of unconventional shale. The company lacks a clear plan with a long-term horizon. This negates its progress in expanding renewable energy generation.