Big Oil's 'bumpy ride' to net-zero; 'A lot of risk' not priced in plastics

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Tightening government and regulatory policies that target the environmental damage linked to plastic pose a substantial risk to the plastic container and packaging industry, according to a new report from financial think tank Planet Tracker.

Of 83 plastic container and packaging companies studied in the analysis with $54 billion in combined revenues, 53 reported no policies on key sustainable packaging-related subjects, and few reflect the rising risk of legislation in their company filings. As of early 2021, none of the companies had issued green bonds, sustainability bonds or sustainability-linked loans, the report found.

"Most companies in the industry do not report their risks," Gabriel Thoumi, a member of the Planet Tracker team, said during a webinar to discuss the findings. Courtney Lowrance, managing director of sustainable banking and corporate transitions at Citi added, "There's a lot of risk that’s still not being priced in," such as emissions from landfills and incineration.

The emissions picture is also worrisome in Europe's power sector, where utilities are sending mixed messages as they tout expiration dates for natural gas while continuing to build new power plants that use the fuel. "Fossil gas is a fuel that will need to be scaled back at considerable speed as we pursue the transition to net-zero," said Frans Timmermans, the European Union's climate czar.

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Podcast

Big Oil's 'bumpy ride' to net-zero

Major oil and gas companies are beginning to set aggressive decarbonization targets, but the path ahead for them is riddled with challenges. The latest episode of S&P Global's "ESG Insider" podcast takes a deep dive into what net-zero goals mean for those energy companies. We hear from the head of strategy at Royal Dutch Shell PLC; the head of stewardship at Sarasin & Partners LLP, a U.K.-based asset manager with more than £15 billion under management that recently divested from Shell after years of engagement; and a senior director at S&P Global Ratings, who explains the rating agency's decision to bump down the credit ratings of some companies in the oil sector, including Shell.
—Listen on SoundCloud, Spotify and Apple Podcasts.

Top Stories

Europe's power giants send mixed messages on future of natural gas

In Europe's five largest power markets, developers have announced more than 60,000 MW of gas plant projects, or almost twice the power capacity of the Netherlands, according to S&P Global Market Intelligence data. It means that utilities face a tightrope act in trying to meet their ambitious net-zero targets while also trying to balance out intermittent renewables and keep the grid stable. "There's a lot of risk in doing this," said Catharina Hillenbrand von der Neyen, head of power and utilities at the Carbon Tracker Initiative. "You could get on that path to uneconomic [operations] pretty quickly. ... As an investor, I'd be extremely nervous about a company who wants to do a new gas plant with a 30-year lifetime."

How one of Europe's dirtiest utilities is planning to decarbonize

In the last of a three-part series on European utilities, we look at how Poland's largest electricity company, PGE Polska Grupa Energetyczna SA, plans to decarbonize in an effort to meet a net-zero target set for 2050. Prodded by the company, the Polish government, a majority owner, is considering splitting off the mines and coal-fired power plants owned by PGE and its smaller state-controlled competitors into a fully state-owned entity that would manage their phaseout over the coming decades.

Power companies urge Biden to adopt clean energy standard cutting emissions 80%

A coalition of 13 power companies wrote a letter to U.S. President Joe Biden in which they backed the formation of a national clean electricity standard that ensures that the power sector will cut carbon dioxide emissions by 80% from 2005 levels by 2030. Biden has set a target to decarbonize the U.S. power sector by 2035 as part of a goal to achieve net-zero greenhouse gas emissions economywide by 2050. But many utilities have said the 2035 target is too ambitious and have embraced interim goals.

Environmental

Coal rebound to largely wipe out pandemic-related CO2 emissions drop – IEA

UK sets 'world's most ambitious' emissions goal, targeting 78% cut by 2035

Stick or twist? Europe divided on nuclear future

Social

Defeated Amazon union campaign could still spur more labor activism in Big Tech

Goldman Sachs says 3.2% of its most senior US employees are Black

Diamond miners recovering from pandemic despite ongoing human rights pressure

Governance

As Nordic banks aim to go greener, lending lags asset management pledges

Danske Bank's CEO change 'embarrassing' but timing could have been worse

Philippine central bank mandates financial firms to manage reputational risks

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