A new report revealed that Pollution from fossil fuel vehicles higher than previously thought. This is because many brands declare less emissions than their cars produce. In some cases there is an excess of 116%.
Global emissions from auto companies, on average, 50% higher than they declared And with mandatory reporting of Scope 3 emissions in 2023, asset managers associated with carbon-intensive automakers are facing a “carbon bomb,” according to a Transport and Environment report (TEA).
In particular, as stated in the document of this international environmental organization, the Hyundai-Kia group, 116%then a BMW 81%and Toyota, a 69%. It was followed by Mercedes-Benz (62%), the Renault-Nissan-Mitsubishi alliance (61%) and Volkswagen (58%).
European Union in 2023 introduce a requirement for financial institutions to disclose scope 3 emissions (indirect emissions) fully affect asset managers who are exposed to vehicle manufacturers. Unlike furniture or mobile phone manufacturers, the majority (98%) of automobile companies’ emissions correspond to Scope 3, primarily from automobile use.
The graph below shows the excess emissions detected by the study:
Automakers base their declared total emissions on a number of factors, such as average vehicle size, where it is driven, and the useful life of the vehicles. T&E says automakers are using selective data to get a lower figure.
They don’t capture the “real climate impact” of companies
The report states that in terms of investment of automobile companies, almost as carbon intensive as the oil industry. At current prices, an average investment of one million euros in oil giants Exxon Mobil, BP and Shell finances around 5,000 tonnes of CO2 equivalent (CO2e). The same amount finances more than 4,500 tons of CO2e in the automotive sector.
By the end of the year, Morningstar, a United States-based financial firm, Estimates that around 50% of all new financial products sold will be based on environmental aspects, social and governance (ESG). But T&E criticizes that ESG ratings don’t capture the “real climate impact” of companies.
The environmental group therefore requests the European Union to regulate and harmonize the ESG rating methodology in order to guarantee consistent and transparent information about the data.
“According to official data, a euro invested in a car company finances almost the same amount of carbon as a euro in an oil company. This should be a wake-up call for the financial industry. It will have to start.”
Full report (in English): https://www.transportenvironment.org/wp-content/uploads/2022/09/Carbon-ESG-finance-Car-Study-Final.pdf
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Environment department contact address:crisclimatica@prensaiberica.es
Source: Informacion
Anika Rood is an author at “Social Bites”. She is an automobile enthusiast who writes about the latest developments and news in the automobile industry. With a deep understanding of the latest technologies and a passion for writing, Anika provides insightful and engaging articles that keep her readers informed and up-to-date on the latest happenings in the world of automobiles.