Carbon Performance assessment of automobile manufacturers: methodology note

Abstract

The TPI Centre’s Carbon Performance assessments have to date been predominantly based on the Sectoral Decarbonisation Approach (SDA).1 The SDA translates greenhouse gas emission reduction targets made at the international level (e.g. under the 2015 UN Paris Agreement) into benchmarks against which the performance of individual companies can be compared. The SDA recognises that different sectors of the economy (e.g. oil and gas production, electricity generation and automobile manufacturing) face different challenges arising from the low-carbon transition, including where emissions are concentrated in the value chain and how costly they are to reduce. Other approaches to translating international emissions targets into company benchmarks have applied the same decarbonisation pathway to all sectors, regardless of these differences. [1] Such approaches may result in suboptimal insights, as not all sectors have the same emissions profiles or face the same challenges: some sectors may be capable of faster decarbonisation, while others require more time and resources.