Climate Pathway Case Studies: Aviation and Shipping
EnvAI’s Climate Pathway API provides the most direct way for investors to align their portfolios with concrete climate mandates. By bringing geoscience to the realm of financial analytics, we enable quantitative decision making that simultaneously optimizes for financial and climate goals. In this post, we benchmark our models against independent data at the sector level. While the Climate Pathway API provides temperature pathways at the corporate level, benchmarking studies at the sector level allows for direct comparisons with existing data.
Case Study 1: Aviation
As a case study, we compare our climate projections for the international aviation sector with independent estimates to gauge the performance of our models. The Climate Action Tracker (CAT) outlines the projected and targeted climate impacts of the aviation sector. Given the historical and projected emissions of the sector based on current policies, CAT projects a climate pathway of 4+ °C by the year 2050. On the other hand, targeted emissions should result in a <2 °C world.
We independently run the total emissions resulting from freight and passenger flights through the EnvAI Climate Pathway analysis pipeline. The results are summarized below:
Comparison data retrieved from Climate Action Tracker: Climate Action Tracker (2021), International Shipping/Aviation Assessment - July 2021 Release -http://climateactiontracker.org. Copyright © 2021 Climate Action Tracker by Climate Analytics and NewClimate Institute. All rights reserved.
Our models indicate a lower bound of 3.9 °C and an upper bound of 4.3 °C by 2050 given projections based on existing policies, with a mean of 4.1 °C. This is in excellent agreement with the CAT climate projection of 4+ °C.
In addition, by implementing the emission target goals of the sector, we obtain temperature pathways leading to a lower bound of 1.3 °C and an upper bound of 1.4°C by 2030, and corresponding values of 1.9 °C and 2.2 °C by 2050. The CAT projections based on target emissions indicate a <2 °C pathway in the 2030s, which is in agreement with our projections.
Case Study 2: Shipping
Global shipping makes up 2 to 3 percent of global carbon emissions. With that number projected to grow to as much as 17%, shipping (both freight and passenger) is a key player in global greenhouse gas emissions. In this case study, we compare the EnvAI Climate Pathways for the international shipping industry to those of the Climate Action Tracker.
CAT provides industry-wide emissions for international shipping since 1990 to present, as well as projected emissions to 2050 based on existing policies. CAT temperature projections place the industry between the Highly Inefficient (< 4 °C) and Critically Insufficient (4+ °C) pathways.
In addition, with an industry goal of 499 to 568 MtCO2-equivalent per year of emissions, CAT places the industry on a targeted temperature pathway of Insufficient (between 2 to 3 °C).
The figure below illustrates the EnvAI pathways based on policy projections (red) and target emissions (blue).
Comparison data retrieved from Climate Action Tracker: Climate Action Tracker (2021), International Shipping Assessment - July 2021 Release -http://climateactiontracker.org. Copyright © 2021 Climate Action Tracker by Climate Analytics and NewClimate Institute. All rights reserved.
We find a climate pathway leading to 3.8 °C by 2050 based on current policy projections, and a pathway leading to 2.4 °C based on industry targets. As shown, our projections fall well within the CAT estimates at the sector level.
The case-studies here are just some examples of how the EnvAI Climate Pathway API compares with independent data. While our API provides insights at the level of individual corporations, aggregated sector-wide analyses provide a robust framework for comparability of results. We see that our climate pathways are well in agreement with the Climate Action Tracker projections for the aviation and shipping industries.
EnvAI’s Climate Pathway API provides actionable climate data for financial institutions by bridging the gap between geoscience and financial analytics and bringing environmental data on an equal footing with traditional data. Learn more about our Climate Pathway API here. To learn more about the product and request a demo, get in touch with us below!
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