Dr. David Allen
In part I and II, we looked at which countries are the main drivers of CO2 emissions with China rapidly overtaking the US as the leading source of emissions.
In part III we drill down into the sectors, industries, and companies that are the largest emitters of CO2.
The interactive chart below breaks down the CO2 emissions by sector, industry, and company within the MSCI World Index (essentially the largest 1500 listed developed market companies).
Utilities immediately jump out at the largest driver of emissions contributing one third of total emissions. If we click on the Utilities segment, we can see that almost all the emissions are driven by Electrical Utilities due to the heavy reliance on fossil fuels. We can drill down further by clicking on the Electrical Utilities segment to see the individual companies driving emissions.
The good news is that renewables, in particular solar power is now often the cheapest source of energy providing a pathway for electricity generators to decarbonise.
What other sectors are driving emissions?
Materials is the second largest driver of emissions, contributing 27% of emissions.
The Metals & Mining and Chemicals industries are the most carbon intensive. Drilling down into Metals & Mining we see that steel giants ArcelorMittal and Nippon Steel are the most significant drivers due to the reliance on coking coal.
Energy ranks third, with majors Exxon Mobil, Shell, and Chevron key contributors.
In fourth place we have transportation with Airlines and Marine making similar contributions.
At the other end of the spectrum, sectors like Technology, Finance, and Healthcare contribute very small amount of CO2 emissions.
In part IV, we look at the breakdown of carbon emissions a bit closer to home in the ASX 300.
About the Author
Dr David Allen is head of Short/Long Strategies at Plato, managing the Plato Global Net Zero Hedge Fund. He holds a PhD from Cambridge and Bachelor of Business with First Class Honours.
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