Carbon Performance assessment of coal mining companies: note on methodology

Abstract

The TPI Centre’s Carbon Performance assessments have historically assessed companies’ emission pathways on an emissions intensity basis – that is, the volume of greenhouse gas (GHG) emissions per unit of economic output. Coal mining is the first sector that we assessed based on absolute emissions rather than emissions intensities. This approach reflects the unique decarbonisation challenges specific to coal mining. Achieving net zero in this sector ultimately requires an almost complete phase-out of coal production. Unlike other industries, where efficiency improvements and new production methods can reduce emissions intensity while maintaining output, coal mining’s main decarbonisation strategy of phasing out production cannot meaningfully be assessed on an intensity basis. This is because coal production and Scope 1-3 emissions would reduce roughly proportionally. To account for these sector-specific characteristics, we introduce the Emissions Contraction Approach (ECA). The ECA remains grounded in the Sectoral Decarbonisation Approach (SDA), which the TPI Centre applies to all its Carbon Performance assessments. This section outlines the rationale behind using the ECA and explains why an alternative method is necessary for assessing the sector’s alignment with international climate goals.