NetZeroReadinessReport2023KPMGESGkpmg.com/NZRRQuickreaderguide03India48Ireland51ContentsForeword05Italy54Japan57Keyinsightsandobservations06Mexico60Netherlands62Globalsectorsummaries10NewZealand64Economy11Norway67Electricity14Singapore70Transport16SouthAfrica73Industry20SouthKorea76Agriculture25Spain78Sweden80Countryprofiles28Switzerland82Australia29UnitedArabEmirates84BrazilCanada32UnitedKingdom8734UnitedStatesofAmerica90China37AboutKPMGESG93Denmark40France43KPMGcontacts94Germany452NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsQuickreaderguideTheNetZeroReadinessReport(NZRR)examinesstepsThe2050targetdatewasproposedbya2018sectors”.Globalemissionsshouldalreadybetakenby24countriesaswellaskeyeconomicsectorstoreportoftheUnitedNationsIntergovernmentalfallingandwillneedtodropbynearly50percentreducethegreenhousegasemissionsthatcauseclimatePanelonClimateChange(UNIPCC),whichsaidby2030toachievethis.2Whiletotalglobalchange.Italsodiscussestheirpreparednessandabilitytothatcuttingnetemissionsbyabout45percentemissionsfellin2020becauseoftheCOVID-19achievenetzeroemissionsofthesegasesby2050.from2010to2030then100percentby2050pandemic,theyreboundedin2021toaboutthewouldlimittemperaturerisesto1.5degreessamelevelasin2019.Figuresforcarbondioxide3NetZeroReadinessReport2023Celsius.Itaddedthatdoingthiswouldlessentheonlyin2022suggesttheyearmayhavesetastill-substantialdamagethatglobalwarmingwillnewrecordhighforemissions.3causeoverthecomingdecades.1Carbondioxide,themostimportantgreenhouseHumanityhasalreadycausedwarmingofgas,isreleasedwhenfossilfuelsareburntapproximately1.1degreesCelsius.InareportandworktowardsnetzeroisoftencalledpublishedinMarch2023,UNIPCCsaidthat‘decarbonization’toreflectthis.Carbondioxidethe“paceandscaleofwhathasbeendonesogenerated74percentofhuman-causedclimatefar,andcurrentplans,areinsufficienttotacklechangein2016.Emissionsofmethane,whichclimatechange”.Keepingwarmingto1.5degreescontributed17percent,andnitrousoxide’sCelsiuswillrequire“deep,rapidandsustained6percentarealsoincludedinthedatausedingreenhousegasemissionsreductionsinallthisreport.4©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QQuuiicckkrreadergguuiiddeeForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsTheNZRRusestheWorldResourcesInstitutedefinitionofTheyaremappedtothefollowingEDGARsectors,whicharenationalemissionsinventories.Thisthresholdhasbeennetzero.Primarily,thisinvolvesreducinggreenhousegasbasedonUNIPCCgreenhousegasemissionscategories:consideredas3percent.Inaddition,intensitiesfortheemissionscausedbyhumansascloseaspossibletozero.energyexcludingelectricity(fuelssector);electricity;fuelssectorareexcludedforcountriesthatdonotproduceRemainingemissionsarebalancedbyanequivalentamountoftransport;buildings(small-scalenon-industrialcombustion);significantamountsoffossilfuels.Ultimatelycountriescancarbonremovalfromtheatmosphere,effectivelyneutralizingindustry(industrialcombustionandindustrialprocesses);onlyprogresstowardsnetzerobycuttingtheirabsolutehumanity’sfutureimpactontheworld’sclimate.5agriculture(livestock,agriculturalsoilsandburningofcropemissionsbutemissionsintensityisincludedtorecognizeresidues);andwaste.7EmissionsdataforFrancealsoprogressondecarbonizationofprocesses,particularlyinfast-AbouttheNZRRincludesdataforMonaco,whilethedataforSpainalsogrowingeconomies.includesAndorraandSwitzerland’salsoincludesdataThisreportisbasedoninterviewswithKPMGnationalclimateforLiechtenstein.Thefollowingabbreviationsareusedthroughoutthetext:CO2changespecialistsin24countriesaswellasglobalKPMG(carbondioxide);ESG(environmental,socialandgovernance);expertsinarangeofeconomicsectors.AswellasprovidingThegraphsonchangesinemissionsintensityareproducedGDP(grossdomesticproduct);GW(gigawatt);andktCO2e,specificinsightsoncountriesandsectors,thereportidentifiesusingnationalgrossdomesticproductfortheeconomyMtCO2eorGtCO2ekilotonnes,(megatonnesorgigatonnesinsightsthatarecriticaltounderstandingandovercomingtheoverallandforthetransport,buildingsandwastesectors.ofCO2equivalent,usedtomeasuretotalgreenhousegaschallengesofthetransitiontonetzeroatagloballevel.Emissionsintensitydataforagricultureandindustryisemissionswithscalingbasedonimpactoveracenturyforbasedonthenationaloutputsofthosespecificsectors.gasesotherthancarbondioxide).USdollarequivalentsforThenationalprofilesincludegraphsshowinghowmuchEmissionsintensityforenergyexceptelectricityisderivedothercurrenciesarecorrectasofOctober2023.sectorscontributetonationalgreenhousegasemissionsandfromkilogramsofcarbondioxideorequivalentpergigajoulehowmuchtheseemissionschangedbetween2005and2022,ofenergyproducedandforelectricityfromkilogramsofbothbysectorandacrosstheeconomy.Thenationalcarbondioxideorequivalentperkilowatthour.ThegraphsandsectoremissionsdatacomesfromtheEuropeanexcludesectorsthatoccupysmallsharesofrespectiveCommission’sEmissionsDatabaseforGlobalAtmosphericResearch(EDGAR).61‘GlobalWarmingof1.5°C:summaryforpolicymakers’,IntergovernmentalPanelonClimateChange,October2018.h­t­t­p­s://w­w­w.ipcc.ch/site/assets/uploads/sites/2/2019/06/SR15_Headline-statements.pdf2‘Urgentclimateactioncansecurealiveablefutureforall’,IntergovernmentalPanelonClimateChange,20March2023.h­t­t­p­s://w­w­w.ipcc.ch/2023/03/20/press-release-ar6-synthesis-report/3‘CO2emissionsin2022’,InternationalEnergyAgency,March2023.h­t­t­p­s://w­w­w.iea.org/reports/co2-emissions-in-20224HannahRitchieandMaxRoser,‘Bygas:howmuchdoeseachcontributetototalgreenhousegasemissions?’,OurWorldinData.h­t­t­p­s://ourworldindata.org/greenhouse-gas-emissions#by-gas-how-much-does-each-contribute-to-total-greenhouse-gas-emissions5KellyLevin,TarynFransen,CleaSchumer,ChantalDavisandSophieBoehm,‘Whatdoes‘netzeroemissions’mean?8commonquestions,answered’,WorldResourcesInstitute,updatedMarch2023.h­t­t­p­s://w­w­w.wri.org/insights/net-zero-ghg-emissions-questions-answered6‘EDGAR—EmissionsDatabaseforGlobalAtmosphericResearch’,EuropeanCommissionDirectorate-GeneralforJointResearchCentre.h­t­t­ps://e­d­g­ar.j­r­c.e­c.europa.eu/7Table3onp29,‘GHGemissionsofallworldcountries2023’,EuropeanCommissionDirectorate-GeneralforJointResearchCentre.h­t­t­p­s://e­d­g­ar.jrc.ec.europa.eu/booklet/GHG_emissions_of_all_world_countries_booklet_2023report.pdf4NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsForewordKPMGpublishedtheNetZeroReadinessIndex(in2021,1afewRenewableenergyproductioncontinuestoexpandrapidlyMikeHayesDavidGreenallweeksbeforetheCOP26UNclimatechangeconferenceinaroundtheworld,investmentisrisingfastandthereareClimateChangeandGlobalManagingDirector,Glasgow.Theeventresultedin153countriesputtingforwardindicationsthatitisbecominghardertoraisefundingforsomeDecarbonizationLeader,GlobalClimateRisk,newemissionstargetsfor2030andmorethan90percentoffossilfuelprojects.RenewableproductionandthereshapedHeadofRenewableEnergyDecarbonization&ResilienceworldeconomicoutputandglobalemissionsbeingcoveredelectricitygridsitrequireswillinevitablyimpactonsomelocalKPMGInternationalKPMGInternationalbynetzeroagreements.Attemptstophaseouttheuseenvironments,theirbiodiversityandcommunities.Weareofcoal,thesinglebiggestcontributortoclimatechange,goingtoseemoreconflictsbetweenthelocalandtheglobal,failedwithweakerlanguageto‘phasedown’itsuseinthebutifwewanttoreachnetzerowhilekeepingthelightson,finalagreement.COP26’schairmanAlokSharmasaidthatwehavetobuildnewpowerinfrastructuresomewhere.theconferencehadkeptalivethehopeofkeepingglobaltemperatureincreaseswithin1.5degreesCelsiusthiscenturyTheseissuesareamongthosediscussedinthisNetZerobutadded“itspulseisweak.”ReadinessReport.Itexploresthereadinessof24countriesbasedoninterviewswithlocalKPMGspecialists.ThisThelasttwoyearshaveseenmanycountriestakingstepsinreportalsoexaminesglobaltrendsinsectorsthatarekeytotherightdirectiontowardsnetzero,evenifmosthavealongtacklingclimatechange:theeconomy,electricity,transport,waytogo.Somehaveannouncedsignificantnewpoliciestomanufacturing,buildings,infrastructure,oilandgas,agriculturesupportdecarbonization,includingtheREPowerEUinEurope.andtheblueeconomy.EmissionstradingschemesareexpandinginseveralcountriesandtheEUisphasinginitsCarbonBorderAdjustmentAcrossthesecountriesandsectorswecanseeplentyofMechanism,anideathatothercountrieslooklikelytoadopt.examplesofprogressondecarbonization,includinggrowthTheblocisalsointroducingregulationstoblocktheimportinelectricvehiclesales,althoughfromalowlevelinmostofproductslinkedtodeforestation,showinghowsomecountries.OnbehalfofalltheKPMGspecialistsinvolved,wejurisdictionsplantogofurtherfastertomeetnetzeropledges.hopethisreportcancontributetohelpingorganizationsquickentheirpaceonthelongwalktowardsnetzero.Nextyearwilllikelyseecompaniesinmanycountriesstartingtoreportontheirclimatechangerisksandplans.1‘NetZeroReadinessIndex2021’,KPMGInternational,October2021.https://kpmg.com/xx/en/home/insights/2021/09/net-zero-readiness-index.html5NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsKeyinsightsandobservations6NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsKeyinsightsandobservationsAustralia,whichhasamongthehighestlevelsofgreenhousepowergeneration,toeightmajorindustriesandSouthKoreagasemissionsperperson,introducednewfederalpolicieswillmovetothenextphaseofitssystemin2026,similarlyTheNetZeroReadinessReport2023drawsonthatamounttoaquantumleapinthecountry’slegislativeextendingitscoverage.theexpertiseofKPMGspecialistsworkingatanarchitecturefollowingachangeofgovernmentinMay2022.internationallevelaswellasineachofthecountriesTheseincludeenshrininga2050netzerotargetdateinlaw,TheEUisintroducingitsCarbonBorderAdjustmentcovered.Thefollowinginsightsarebasedontheirincreasinginterimreductiontargetsandsupportinglaws,MechanismfromOctober2023,whichwilleventuallyrequireobservations,withmoredetailsinthesectorandtargets,regulationsandinitiatives.Canada,whichhassimilarlythoseimportingsomegoodstopayanequivalentpricefortheircountryprofiles.highperpersonemissions,includedbillionsofdollarsofemissionstomanufacturersbasedinthebloc.Australiaandincentivesfor‘cleaneconomy’investmentsinits2023federaltheUK,whichbothhaveemissionstrading,areconsidering1Severaloftheworld’sbiggestemittingbudget.Brazil,whereperpersonemissionshavefallenoverthesimilarmechanisms.IndiamaychallengetheEUmechanismlasttwodecadesbutremainhigherthantheglobalaverage,isandSouthAfricaisconsideringhowitshouldrespond,butovercountrieshaveincreasedtheirnetzerodiscussingtheintroductionofaregulatedcarbonmarketthattimeborderadjustmentslooklikelytoreinforcetheimportanceambitions.wouldbuildontheprogressthecountryhasmadetoreduceoflowcarbonproductionasasourceofcompetitiveadvantage.emissionsfromelectricityproductionandroadvehicles.InFebruary2021theUS,theworld’ssecond-largestproducerCompaniesinmanycountriesmaysoonprovidemoreofgreenhousegasesbyvolume,formallyrejoinedtheUNParisTheEUincludessomeoftheworld’smostclimate-consciousinformationonclimatechangerisksandplansunderarangeAgreementonclimatechange,andtheInflationReductionActcountrieswhichasagrouphavealreadymadesignificantofnewstandards.Theseincludeaglobalbaselinedrawnintroducedmajortaxincentivesandbenefitsfordecarbonizationprogressondecarbonization.However,Russia’sinvasionofupbytheInternationalSustainabilityStandardsBoard,workwithUS$370billionallocatedtoenergysecurityandUkraineinFebruary2022andtheresultinglossofRussianwhichcountriesincludingtheUKplantoimplement.Otherclimateprograms.naturalgasfromEuropeanmarketscausedthebloctoincreasejurisdictionsareintroducingregimesthatbuildonthis,includingitsambitionsthroughtheREPowerEUplan,whichaimstotheEU’sEuropeanSustainabilityReportingStandards,whileChina’sPresidentXiJinpingsaidinSeptember2020thattheacceleratetheimplementationofrenewableenergy.newdisclosurerulesareexpectedfromtheUSSecuritiesandcountry,thelargestproducerofgreenhousegasesbyvolume,ExchangeCommissionandtheAustralianauthorities.wouldaimtoreachpeakcarbonemissionsbefore2030.1The2Netzeroisweavingitselfintotheworld’sgovernmenthassincepublishedmoredetailonhowithopesto3Prarpoiddulyc.tionoflowcarbonenergyisgrowingachievethis,includingcoalconsumptionstartingtofallby2030economicsystems.andenergyproducedwithoutfossilfuelsrisingto20percentAtpresent,fossilfuels—coal,naturalgasandoil—provideby2025and25percentby2030.ForthenextfewyearsChinaJurisdictionsaroundtheworldhaveintroducedemissions82percentoftheworld’sprimaryenergybutmanyoftheseeselectricityfromcoalasprovidingenergysecurity,buttradingsystemsthatrequirethoseproducinggreenhousegasdecarbonizationpolicyinitiativesofthelasttwoyearshavemassiveinvestmentsinrenewableenergyandinfrastructureemissionstobuytradableallowancesorpermits,althoughfocusedonextendinglowcarbonenergy.WhileChinaandIndiaindicatethatitislookingbeyondcoalforthelongterm.manyapplyonlytosomesectors.TheEU,whichestablishedareaddingbothfossilfuelandlowcarbongenerationtomeetthefirstsuchschemein2005,isintheprocessofextendingitrapidlyincreasingdemand,theInternationalEnergyAgencytonewsectors,includingmaritimeshippingaswellasreducingpredictsthatcleanenergywillreceiveUS$1.8trillion(inpredictionthenumberofallowancesandphasingoutfreeallocations.Chinaisplanningtoextenditsscheme,whichcoversonly7NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsNuclearpower,whichforspendingoncleanenergy)ofinvestmentgloballyin2023,adoptionofinnovativeapproaches,giventhatnotdoingsowillwhilenotarenewableencouragedbyincentivesfromjurisdictionsincludingtheUSandhavesignificantconsequencesfortheglobalclimate.energysourceproducestheEU,comparedwithUS$1trillionforcoal,oilandgas.2lowcarbonelectricityKPMGbelievesthatagreaterunderstandingofthepracticalreliably,remainspoliticallyCountriescanchoosefromawiderangeoflowcarbonchallengesinvolvedinscalinguprenewableproductionisunacceptableinseveraltechnologies.Thosewithlargeareasofterritorialwatersareneededifglobalclimateambitionsfor2030andbeyondaretobecountries.Somehaveturningtooffshorewind,whichatpresentmeansfixedturbinesachieved.Inresponse,KPMGisundertakingacomprehensivereconsideredthisandareinshallowwaters.Newfloatingplatformsunderdevelopmentstudytoidentifyandunderstandtheglobal,regionalandpracticalplanningnewcapacity,willallowwindpowerproductionindeeperseas,aparticularchallengesthathinderrapiddeploymentofrenewableenergy,giventhewayinwhichopportunityforJapangiventhedepthsofmanyofitsterritorialoutlinepotentialsolutionsandmakespecificrecommendationsnuclearpowercontributeswaters.Denmarkisdevelopinganartificialenergyislandasaastohowtoovercomethechallenges.3towardsdecarbonizationconnectionandmaintenancepointforoffshorewindwhileIrelandincountriessuchasrecentlyauctionedrightstoconstructturbinesinitswaters.4IncreasingelectricvehiclesalesshowhowFrance.Indiaisdevelopingsignificantamountsofsolargenerationforrapidlysomesectorscandecarbonize.8NetZeroReadinessReport2023domesticuse.SomecountrieswithplentifulsunlightandlandarelookingtoexportitthroughinterconnectorsorpipelinesforgreenTheglobalsalesshareofelectriccarstripledfrom4.2percentinhydrogenmadewithsolarenergy,withplansfora3,300kilometer2020to14percentin2022.ItrosefivefoldinChinato29percenthydrogen-readypipelineprojectbetweenItalyandnorthernAfricawhilenearly9in10carssoldinNorwayin2022wereelectric.4whileSingaporehasapprovedaninterconnectorinvolvingmoreAlthoughfromalowbaseandatlevelsthatvarygreatlybythan1,000kilometersofsubseacablestoimportrenewablecountry,roadtransportisincreasinglypoweredbyelectricityor,electricityfromCambodia.ThereisrenewedinterestinnuclearinthecaseofBrazil,ethanolbiofuelsproducedfromsugarcaneorpower,withtheUnitedArabEmiratesduetoputthefourthandcorn.Otherroadvehicles,includingcommercialvehicles,busesfinalunitofitsnewBarakahplantliveshortly.andtrucks,areincreasinglymovingtobatteriesorgreenfuels.OtherformsoftransportsuchasshippingandaviationarestartingScalingupproductionofrenewableenergyisregardedasoneoftodecarbonizebyadoptinggreenfuels,butthepooravailabilitythemostcriticalactionsrequiredtoachievetheParisAgreementandhighcostofsuchfuelsaswellasmuchlongerlifespansoftargetoflimitingglobaltemperaturerisesto1.5degreesCelsius.vesselsandaircraftmeanschangeistakingplacemoreslowly.However,atpresentmostrenewableenergydevelopersfaceseveralseriouschallengesthatendangertherapidgrowthofThegrowthinelectricroadvehiclesiscreatingcapacityissuesrenewablesthisdecadethetargetrequires.Theseincludewithseveralcountrieshavingproblemsincreasingvehicleshortagesofcriticalminerals,gridinfrastructure,energystoragechargernumbersandlocalelectricitygridcapacityquicklyfacilitiesandskilledworkersalongwithpolicyinhibitorsandenoughtosupportgrowingelectricfleets.Chargershortagesplanningbottlenecks.Tacklingtheserequirestheimmediatecouldbeaddressedby‘dynamiccharging’thatrechargesvehiclesinmotion,whichSwedenisplanningtointroduceonthousandsofkilometersofroad.Inmanycasesgrowth©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsinelectricvehicleshasrequiredhighlevelsofgovernmentNuclearpower,whichwhilenotarenewableenergysourceAgricultureisexperiencingacuteconflictsoverhowtoreducesubsidy,whichinNorwayhasinvolvedtaxbreaksandpriceproduceslowcarbonelectricityreliably,remainspoliticallyemissions,withsomecountriesflaggingtheneedforlivestockincentives,althoughthishasalsohelpedthecountrydevelopunacceptableinseveralcountries.Somehavereconsideredfarmingtoshareindecarbonizationefforts.Attemptsinanecosystemofstart-upsinthisfield.thisandareplanningnewcapacity,giventhewayinwhichNewZealandtoagreeawaytomanageandreduceon-farmnuclearpowercontributestowardsdecarbonizationincountriesemissionsbetweengovernmentandrepresentativesoffarmers5ImpactsoflowcarbonpowerprojectsonlocalsuchasFrance.andgrowers,whichwouldbeapowerfulwaytoincentivizeinnovation,areyettosucceed.Therearewaysinwhichenvironmentsarecausing‘greenongreen’6Netzerobacklashesoccurwhenpeopleagriculturecanreduceemissions,suchassupplementingconflicts.livestockdietstoreducemethane,turningeffluentintobiofuelsfearcostsandbansratherthannewandsequesteringcarbon.Thelastalsorepresentsa‘blueMostkindsofpowerproductionhavealocalimpactandthisopportunities.economy’opportunityforcoastalareas,includingsmallislandcanbeamplifiedforrenewablegenerationsitedinremoteeconomiesthatareparticularlythreatenedbyclimatechange,rurallocations.LinkinglargenumbersofremotesiteswhileWhilemanypeoplesupportworktowardsnetzeroinprinciple,throughexpandingareasofmangrovesandothercarbon-richdistributingmorepowerforvehiclecharging,heatingandtheymayopposemeasuresthatcostalotofmoneyorecosystems.otherapplicationsmeansincreasingthescopeandcapacitystopthemdoingsomething,particularlyifitinvolvestheirofpowergrids.Bothgenerationandinfrastructureprojectslivelihoods.TheUKisstrugglingtomovesomeofEurope’scanhavesignificantimpactsonlocalwildlife,biodiversityleastefficienthomesfromnaturalgasheatingtolowcarbonandcommunities,leadingtooppositionandinsomecasesalternatives,withfewhomeownerschoosingtoinstallheatworkbeingblocked.Nationalenvironmentalrulescancausepumpsgiventhecostsanddifficultiesinvolved,anditssimilarclashes,withnitrogenemissionpermitsrequiredinthegovernmentrecentlydelayeditsplanneddatetoendsalesofNetherlandshinderingtheconstructionofgreenhydrogenandnewgasboilers.AnattemptbytheGermangovernmenttobiofuelplantsinRotterdam.However,severalcountriesarebanreplacementnaturalgasboilerswassignificantlymodifieddevotingconsiderableefforttoreformingsystemstoaddressafteritranintoopposition.Switzerlandisprovidingsignificanttheseconcernsproactively,includingthroughbettersitefinancialsupporttohelpownersreplacefossilfuelheatingplanning,communityconsultationandbenefitsharing.inbuildings,whicharealreadyofrelativelyhighqualitybyinternationalstandards.1Chinanationalprofile,‘NetZeroReadinessIndex2021’,KPMGInternational.2‘Executivesummary,‘NetZeroRoadmap:AGlobalPathwaytoKeepthe1.5°CGoalinReach’,InternationalEnergyAgency,September2023.h­t­t­p­s://w­w­w.iea.org/reports/net-zero-roadmap-a-global-pathway-to-keep-the-15-0c-goal-in-reach/executive-summary3‘Turningthetideinscalingrenewables’,KPMGInternational,September2023.https://assets.kpmg.com/content/dam/kpmg/xx/images/2023/09/scaling-renewables-client-survey-landscape.pdf4‘GlobalEVDataExplorer’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/global-ev-data-explorer9NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsGlobalsectorsummaries10NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsEconomyThereareseveralfactorsthatlooklikelytoconstrainSuchsupporthasledinvestmentsbygovernmentsandbusinessesonmanygovernmentsdecarbonizationoverthenextcoupleofyears.toborrowmore,withglobalpublicManygovernmentsworldwideincreasedspendingsharplydebtincreasingfromonhealthcareandeconomicsupportforindividualsand84percentofgrossbusinessesduringtheCOVID-19pandemic.FollowingthedomesticproductinRussiangovernment’sinvasionofUkraineinFebruary20222019to92percentinandsubsequentincreasesinthepriceofnaturalgas,many2022accordingtotheEuropeancountriesspentheavilytosubsidizehouseholdInternationalMonetaryenergybills.1Fund.Addingtothis,risinginterestrateshaveSuchsupporthasledmanygovernmentstoborrowmore,furtherincreasedthewithglobalpublicdebtincreasingfrom84percentofgrosscostofservicingdebtsdomesticproductin2019to92percentin2022accordingforgovernments.totheInternationalMonetaryFund.2Addingtothis,risinginterestrateshavefurtherincreasedthecostofservicingdebtsCarbonborderadjustmentsforgovernments.“Itleaveslessroomforthemtospendonmeetingnetzerotargets,”saysYaelSelfin,ChiefEconomist,Manyjurisdictionshavesetupemissionstradingsystems(ETS),KPMGintheUK.alsoknownascap-and-tradesystems,thatlimitorcapthetotalemissionsthatcertaincompaniesorindustriesareallowedInaddition,economicgrowthisrelativelyweakinmanytoemitannually.Theamountsarecoveredbytradeablecountries,constraininggovernmenttaxrevenuesandputtingallowancesorpermits,whichallowtheholdertoemitadownwardpressureonprofitsforbusinessesinsomesectors,specifiedvolumeofgreenhousegasemissions.Thissetsawhichmakethemlessabletopursuegreeninvestments.priceoncarbonbyrequiringcompaniestobuypermitsthatHigherinterestratesalsoincreasethecostofborrowingbycoverthevolumeofemissionsemittedduringagivenperiodorcompaniestofundsuchinvestments.Finally,electionsduefacesubstantialpenalties.inseveralmajoreconomiesoverthenexttwoyearsaddtothepolicyuncertaintyastheycouldleadtochangesinenvironmentalpolicies,makingcompaniesmorelikelytowaitbeforeembarkingonlargeprojects.11NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsTheschemesaimtoreduceemissionsbyhavingalimitedcement,ironandsteel,aluminum,fertilizers,electricityandproductsaffectcompetitiveness,”saysNicoledeJager,numberofpermitsavailablethataregraduallyreduced,hydrogen.4Fullimplementationofthemechanism,underwhichSeniorTaxManager—GlobalESGTax,KPMGInternational.increasingthecarbonpriceovertime.Suchschemes,whichimporterswillhavetobuyCBAMcertificates,islinkedtothe“AsothercountriesexplorethepotentialforimplementationtypicallystartbycoveringjustthelargestproducersofphasingoutoffreeallowancescurrentlyprovidedunderEUETSoftheirownCBAMs,itisclearthattheproductionofgreenergreenhousegases,providealong-termfinancialjustificationandisplannedtostarton1January2026.BeforethistheEUproductsisnolongerlimitedtosustainabilitydepartmentsorforcuttingemissionswhileallowingcompaniestochoosewillassessthemechanism’sfunctioningwithaviewtoextendpublicperceptionmanagement.Thecarboncontentofgoodsishowtheydothis.However,duetoincreasedcostsfromitsscopetoothercarbon-intensivesectorsatriskofcarbonbeginningtofeatureasastrategicbusinessdecision,onethatbothemissionstradinganddecarbonizationefforts,localleakage.Theintentionisthatallgoodsandsectorscoveredbyimpactscross-bordertradeandcompanies’futuregrowthandcompaniescanpotentiallybeundercutonpricebyimportersEUETSwillalsobecoveredbyEUCBAMby2030.5prospectsofsurviving.”fromjurisdictionsthatdonothaveequivalentcarbonpricingsystems,aproblemtypicallyreferredtoas‘carbonleakage’.OthercountriesareexploringtheimplementationoftheirownClimateandsustainabilityreportingCBAMs.InMarch2023theUK,whichwaspartofEUETSTheEUestablishedtheworld’sfirstETSin2005,whichnowuntilitlefttheblocandsetupitsownsimilarscheme,saiditCompaniesaroundtheworldwillsoonneedtoprovidemorecoversaround15,000stationaryinstallationsproducingsomewouldconsultonproposalsforaUKCBAMtobeintroducedinformationonhowtheywillbeaffectedbyclimatechangeand36percentofthebloc’sgreenhousegasemissionsandfrom2026attheearliest.KPMGintheUKsaystheBritishwhattheyaredoingtotackleit.TheInternationalSustainabilityincludingnon-EUcountriesIceland,LiechtensteinandproposalhassimilaritieswithEUCBAMbutthatbusinessesStandardsBoard(ISSB)producedwhatisintendedasaglobalNorway.3TheEUisstrengtheningEUETSbyextendingitscouldstillhavetocomplywithtwodistinctregimes.6baselineforreportingonsustainability,drawingontheworkofscopetoadditionalsectors,phasingoutfreeallowancesandtheTaskForceonClimate-relatedFinancialDisclosures(TCFD),acceleratingthereductionofthenumberofallowancesinBusinessesinothercountrieswithcarbon-intensiveexportswhichcountriesincludingtheUKhaveindicatedtheywillcirculation,butallthisheightenstherisksofcarbonleakage.maybefacedwithsignificantlyincreasedexportcoststoincorporateintonationalrules.OtherjurisdictionsincludingthemarketscoveredbyCBAMs,ifimporterschoosetopassEUandtheUSareintroducingtheirownregimesthatbuildonToaddressthisrisktheEUhasintroducedtheworld’sfirstthecostofpurchasingcertificatesontosuppliers.AtthetheISSBbaselinewithJapanplanningtodolikewise.carbonborderadjustmentmechanism(CBAM),whichwillCOP27UNclimatechangeconferenceinNovember2022requireaffectedcompaniesimportingspecifiedgoodsthegovernmentsofBrazil,SouthAfrica,IndiaandChinaTheISSB,EUandUSallintendtoimprovedisclosuresforintotheEUtobuycertificateswithpricesbasedonthepublishedajointstatementsayingthat“unilateralmeasuresinvestorsonclimatechange,withtheEU’sdraftstandardsEUETSweeklyauctionpriceadjustedforanyrecognizedanddiscriminatorypractices,suchascarbonbordertaxes,thatalsocoveringotherstakeholders.BoththeEUandUSplantomandatorycarbonpriceeffectivelypaidinthecountryofcouldresultinmarketdistortionandaggravatethetrustdeficitphaseinsuchreportingfromthe2024financialyearforreportsorigin.Theintentionisthatimporterswillpaythesameforamongstparties,mustbeavoided”.7InMayIndiaindicatedpublishedin2025.TheISSBstandardswillbeavailableforthecarbonemissionsrequiredtoproducegoodsasproducersthatitintendstochallengeEUCBAMattheWorldTrade2024financialyearreportsalthoughthetimingwillbeamatterwithintheEU,creatingalevelplayingfieldandpreventingOrganization.8SouthAfrica’sgovernmentisconsideringhowforeachjurisdiction.10carbonleakage.torespond,althoughKPMGinSouthAfricasayssomelargecompaniesarealreadyworkingontheissue.9Manylargecompaniesalreadypublishsuchmaterial,withEUCBAM’stransitionalphase,startingon1October2023,researchbyKPMGin2022findingthat96percentoftherequiresimporterstoreportonemissionsembeddedin“TheintroductionoftheEU’sCBAMrepresentsaneweraG250groupoftheworld’s250biggestcompaniesreportonspecifiedgoodsinalimitednumberofcarbonintensivesectors:ofglobaltrade—onewheretheembeddedemissionsofsustainabilityissues.ThesurveyfoundthatTCFDstandards12NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactswereusedby61percentoftheG250,upfrom37percentprovidingabasisforassurancemeasures.Thisofferscompaniesbalancesthatwilldrivemeaningfulchangeandcontributetoaintheprevioussurveytwoyearsearlier,withnearlythree-astructuredpathtofollowandarobustsystemforvalidation.moresustainableglobaleconomy.“Inthejourneytonetzero,quartersofreportsincludingcarbontargets.11ESGassuranceservestoenhancethepublictrustoverESG-ESGassurancehasemergedasacrucialmechanismforrelateddata,andisastrategicdriverenhancingtransparency,“EffectiveESGreportingwillnothappenovernightandofferingcredibleandunbiasedverificationofacompany’saccountabilityandauthenticity,propellingcompaniestowardintegratingESGintocorporatestrategyandoperationsisaprogresstowardsachievingitsnetzeroobjectives.Asmeaningfulandimpactfulsustainabilityoutcomes,”saysMikesubstantialchangemanagementexercise,”saysDrJan-HendrikcompaniesincreasinglysetambitiousemissionreductionShannon,GlobalHeadofESGAssurance,KPMGInternational.Gnändiger,GlobalESGReportingLeadandPartner,KPMGintargets,theprecisionandopennessoftheirreporteddataGermany.“Seniorexecutivesshouldwastenotimeinhasteninghavetakenonsignificantimportance.KPMG’sESGAssurancetheircompany’stransitiontoapositionwherenon-financialMaturityIndex,focusingoncompanieswithanaveragereportingholdsthesameimportanceasfinancialreporting—revenueofUS$15.6billion,foundthatonly23percenthaveandbepreparedtoobtainassurance.”effectivelydocumented,testedandimplementedprocessesandcontrolsfortheirenvironmentaldata,indicatingtheESGassuranceongoingchallengesmanyfaceinthisarea.12ThereleaseoftheEuropeanSustainabilityReportingStandardsAsreportingstandardsarephasedinoverthecomingyears,intheEUandthefirsttwoISSBstandardsrepresentsanESGassurancewillplayavitalroleinbridgingthegapbetweenimportantmilestone,theestablishmentofgloballyacceptedintentionandimpactandprovidingnecessarychecksandframeworksthatcompaniescanadoptandadheretowhilealso1‘Whichcountriesaredoingthemosttotackleenergybills?’,BBCNews,21December2022.h­t­t­p­s://w­w­w.bbc.com/news/615221232‘2023Fiscalmonitor’,InternationalMonetaryFund,April2023.h­t­t­p­s://w­w­w.imf.org/en/Publications/FM/Issues/2023/04/03/fiscal-monitor-april-20233‘EUEmissionsTradingSystem(ETS)dataviewer’,EuropeanEnvironmentAgency,27July2023.h­t­t­p­s://w­w­w.eea.europa.eu/data-and-maps/dashboards/emissions-trading-viewer-1and‘TheEUEmissionsTradingSystemin2021:trendsandprojections’,EuropeanEnvironmentAgency,updated7February2023.h­t­t­p­s://w­w­w.eea.europa.eu/publications/the-eu-emissions-trading-system-24‘CarbonBorderAdjustmentMechanism’,EuropeanCommission.h­t­t­p­s://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism_en5MerijnBetjes,‘UpdateCarbonBorderAdjustmentMechanism(CBAM):provisionalagreementreached’,KPMGMeijburgintheNetherlands,14December2022.h­t­t­p­s://meijburg.com/news/update-carbon-border-adjustment-mechanism-cbam-provisional-agreement-reached6CarolNewham,‘GovernmentannouncesUKCBAMconsultation’,KPMGintheUK,17April2023.https://kpmg.com/uk/en/home/insights/2023/04/tmd-government-announces-uk-cbam-consultation.html7‘BASICMinisterialjointstatementattheUNFCCC’sSharmel-SheikhClimateChangeConference’,SouthAfricaDepartmentofForestry,FisheriesandtheEnvironment,15November2022.h­t­t­p­s://w­w­w.dffe.gov.za/mediarelease/basicministerialmeeting_cop27egypt20228ManojKumarandNehaArora,‘IndiaplanstochallengeEUcarbontaxatWTO’,Reuters,16May2023.h­t­t­p­s://w­w­w.reuters.com/world/india/india-plans-challenge-eu-carbon-tax-wto-sources-2023-05-16/9SeeSouthAfricaprofile.10‘Comparingsustainabilityreportingproposals’,KPMGInternational,April2023.https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2022/06/comparing-sustainability-reporting-proposals-talkbook.pdf11‘Bigshifts,smallsteps:SurveyofSustainabilityReporting2022executivesummary’,KPMGInternational,October2022.https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2022/10/ssr-executive-summary-small-steps-big-shifts.pdf12‘Roadtoreadiness:ESGAssuranceMaturityIndex’,KPMGInternational,September2023.https://kpmg.com/xx/en/home/insights/2023/09/road-to-readiness.html13NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsElectricityThelasttwoyearshaveseenrenewableelectricityusedtoforthefirsttime.2However,theshiftininvestmentisyettomakerespondtoeconomicsanctionsaswellasdecarbonizationmuchofanimpactontheoverallmixofenergysourcesusedtotargets.TheRussiangovernment’sinvasionofUkraineingenerateelectricity.In2022,renewables,hydroelectricityandFebruary2022andtheresultingneedtoreplacesuppliesofnuclearcombinedgenerated38percentoftheworld’selectricityRussiannaturalgasledtheEuropeanCommissiontoaccelerateaccordingtoannualdatapublishedbytheEnergyInstitute,aandenhanceexistingplanstoextendrenewablegeneration,professionalmembershipbody,butcoalremainedthesinglethroughitsrapidlydevelopedREPowerEUplanoutlinedinbiggestsourceproducing35percentwithnaturalgassecondatMarch2022andpublishedinMayofthatyear.Inarecent23percent.3assessmentthecommissionsaysthatinstallationofwindandsolargenerationbothrosebynearly50percentin2022Inarecentassessmentcomparedwith2021whileuseofnaturalgas(forheatingaswellthecommissionsaysthataselectricitygeneration)was18percentlowerbetweenAugustinstallationofwindand2022andMarch2023comparedwiththepreviousfive-yearsolargenerationbothaverageforthosemonths.1rosebynearly50percentin2022comparedwithTheEU’suseofrenewablestotackleapotentialenergy2021whileuseofnaturalcrisiswasanimportantmomentaccordingtoMikeHayes,gas(forheatingaswellClimateChangeandDecarbonizationLeader,GlobalHeadofaselectricitygeneration)RenewableEnergy,KPMGInternational:“Itputdecarbonizationwas18percentlowersolutionsandparticularlyrenewableenergyatthecenterofthebetweenAugustenergydebate,”hesays.However,thesharprisesinenergy2022andMarch2023costsresultingfromtheremovalofRussiangashavealsocomparedwiththehighlightedtheenergytrilemmainvolvedinbalancingprice,previousfive-yearavailabilityanddecarbonization.averageforthosemonths.Globally,spendingtodeveloplowcarbonenergyisnowsignificantlyhigherthanthatforfossilfuels.TheInternationalEnergyAgencypredictsthatcleanenergywillreceiveUS$1.8trillion(inpredictionforspendingoncleanenergy)ofinvestmentin2023comparedwithUS$1trillionforcoal,gasandoil,withthisyearseeingmoreinvestmentinsolarenergythanoil14NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsWhilesomecountriesarereplacingcoalwithlowcarbonhavingmassivepotentialtousenewinterconnectorcablesproductionofcomponentsincludingsolarpanels,aswellassources,fast-growingeconomiesincludingChinaandIndiaaretosellelectricitytoEurope.Severalcountriesareshowingdifficultiessourcingcriticalminerals.Whilerenewableenergyaddingbothfossilfuelandlowcarbongenerationtotrytomeetrenewedinterestinnucleargeneration,bothconventionallargeprojectscannowbeestablishedwithwell-testeddevelopmentrapidlyincreasingdemand.AnishDe,GlobalHeadofEnergy,plantsandnewsmallmodularreactors(SMRs),giventhisdoesprocessesthatusereliabletechnologiestogenerateelectricityNaturalResourcesandChemicals,KPMGinIndia,saysIndianotproducegreenhousegasemissionsfromproduction.5atreasonablecost,therearestillbarrierstoovercome.isdevelopingmoregenerationfromnuclear,hydrogenandsolaraswellasstoragecapacity.“Butthatdoesn’tchangetheGridsandotherchallengesGovernmentpolicieslooklikelytocontinuetoencouragebalancethatmuch,”hesays,asthecountryhasalsoincreasedgreateradoptionofrenewableelectricitygeneration,includingcoalgenerationrapidlyoverrecentyears.4ConnectingrenewablegenerationtoconsumerstypicallytheUSInflationReductionAct,REPowerEUandsimilarpoliciesrequiresthere-engineeringofelectricitygrids,mostofwhichelsewhere.FinancialincentivesintroducedbygovernmentsOffshorewind,solarandnuclearweredesignedtodistributepredictablelevelsofelectricitysuchascarbontaxesandleviesincludingtheEU’sCarbonfromafewlargepowerplantsratherthanhandlelotsoffar-BorderAdjustmentMechanismincentivizecompaniestoAmongrenewabletechnologies,offshorewindandsolarhaveflungsiteswithintermittentproduction.Manyoperatorsaremakegreateruseoflowcarbonelectricityandindividualsparticularlystrongpotentialoverthenextfewyears.Offshorebuildingnewpowerlines,connectionpointsandsubstationsaswillsimilarlybeinfluencedbytaxbreaksandregulationsonwindislessconstrainedthanonshoredevelopments,whichwellaschangingthewaytheymanagetheirgridsorhaveplanselectrificationofvehiclesandinsomecountrieshomeheating,havetocompetewithotherlandusesandplanningregulations.todoso.althoughsomemaycausepoliticalcontroversy.“WearegoingFloatingplatformtechnologycurrentlyunderdevelopmentwilltoseealotmorepolicymeasurestohelpdriveustowardslow-allowturbinestobeinstalledindeeperseasthanthosefixedNewrenewablegenerationmaybeessentialindecarbonizingcarbonelectrification,”saysHayes.totheseabed,openingnewareasofoceanforgeneration.economiesandslowingclimatechange,butitoftencausesCountrieswithlargeareasofterritorialwaterssuchasCanada,impactsonlocalenvironments,wildlifeandbiodiversity.SomeChina,France,Ireland,Japan,theUKandtheUSareamongprojectsarealsobeopposedbythoselivingnearbyincludingthosedevelopingoffshorewind.indigenouspeople,suchasSámicommunitiesinNorwayandSwedenwhoopposewindturbinesastheyaffecttheirreindeer.Meanwhile,solarpowerlookslikelytobecomeanincreasinglyimportantexportforcountrieswithenoughsunlightandlandProjectscanalsobedelayedbyoverstretchedsupplychains,toproduceit,withthoseintheMiddleEastandnorthAfricaalthoughseveralcountriesaremakingeffortstodeveloplocal1‘REPowerEU—oneyearon’,EuropeanCommission,May2023.h­t­t­p­s://energy.ec.europa.eu/topics/markets-and-consumers/actions-and-measures-energy-prices/repowereu-one-year_en2Executivesummary,‘NetZeroRoadmap:AGlobalPathwaytoKeepthe1.5°CGoalinReach’,InternationalEnergyAgency,September2023.h­t­t­p­s://w­w­w.iea.org/reports/net-zero-roadmap-a-global-pathway-to-keep-the-15-0c-goal-in-reach/executive-summary,‘Cleanenergyinvestmentisextendingitsleadoverfossilfuels,boostedbyenergysecuritystrengths’,InternationalEnergyAgency,25May2023.https://www.iea.org/news/clean-energy-investment-is-extending-its-lead-over-fossil-fuels-boosted-by-energysecurity-strengths3‘Electricitygenerationbyfuel’,StatisticalReviewofWorldEnergy2023,EnergyInstitute.h­t­t­p­s://w­w­w.energyinst.org/statistical-review4‘India’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/countries/india5KevinMasters,‘Howsmallmodularnuclearreactorscanhelpdecarbonizepowergrids’,KPMGintheUK,January2023.https://kpmg.com/xx/en/home/insights/2023/01/how-small-modular-nuclear-reactors-can-help-decarbonize.html15NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsTransportTheautomotiveindustrycontinuesitstransitionfrominternalrecoveryofenergyfrombrakinganduseofsolarpanelsAswellaschangingthetechnologyofprivatevehicles,combustionenginestoelectricvehicles,althoughthepaceofonvehiclescouldincreasebatteryranges.Meanwhile,thecountriescancutemissionsbyencouragingpeopletouseadoptionvarieswidelyfromcountrytocountry.Theworldwideintroductionofinductivechargingthatdoesnotneedacablesharedalternatives.Publictransportservices,whichtypicallysalesshareofelectriccarstripledfrom4.2percentofsalesincouldmakeitmoreconvenient,withSwedenplanningtohavemuchlowerlevelsofemissionsperpassengerkilometer2020to14percentin2022accordingtotheInternationalEnergyequipthousandsofkilometersofroadwiththistechnologythancars,sawsharpdropsinuseduringtheCOVID-19Agency(IEA).Electriccars’shareoftheEUmarketdoubledoverthenexttwodecades.4“Ingeographicallylargepandemicanddataindicatesmanysystemshavenotyetoverthesameperiodto21percentandrosefivefoldinChinatoenvironmentsorwherethereisacultureofdrivingsuchasinrecovered.PassengerrailkilometerstraveledintheEUfell29percent.InNorway,whichhasledtheworldintheiradoption,theUS,peopleneedconfidenceintheirabilitytorechargetheirfrom414billionin2019to224billionin2020andrecovered88percentofcarsalesin2022wereofelectricmodels.1vehicles,”hesays.“Technologycansortsomeofthisout.”onlyslightlyto261billionin2021,adropofmorethanathirdbetween2019and2021.6TheIEAsaysthattwoandthree-wheelervehicles,popularHowever,headdsthatelectricvehiclesrelyontheavailabilityinmanyemerginganddevelopingeconomies,arealreadyofawiderrangeandgreaterquantityofcriticalmineralsthatUseoftramandlightrailsystemsgloballyfollowedasimilarhighlyelectrifiedwithmorethanhalfofIndia’sthree-wheelerareneededforinternalcombustionengineones,withatypicalpattern,fallingfromaround14.8billiontripsin2019toaroundregistrationsin2022beingforelectricvehicles.Salesofelectricalmodelrequiring53kilogramsofcoppercomparedwith9billionin2020thenremainingbelow10billionin2021.7electriclightcommercialvehiclesandbusesareincreasing22kilogramsinaconventionaloneaccordingtotheIEA.5SomeJourneysonTransportforLondon’sbus,Underground,tramrapidlyandmanufacturersarebringingmoreelectricheavy-ofthesemineralsareminedinonlyafewlocationsgloballyandandrailserviceswerearound10percentlowerintheseconddutymodelstomarket.2Chinahas90percentofthecurrentprocessingcapacity.quarterof2023thanthesameperiodin2019.8However,growthinsomecountriesmaybeconstrainedby1‘GlobalEVDataExplorer’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/global-ev-data-explorertheabilityofcharginginfrastructuretokeepup.Problemsincludeincompatiblechargingsystemsbetweencountriesand2‘Executivesummary’,GlobalEVOutlook2023,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/reports/global-ev-outlook-2023/executive-summarywithinthemandcapacitylimitationsofelectricalgrids.Several3‘Chargingahead:addressingtheEVcosthurdle’,KPMGInternational,August2023.https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2023/07/charging-ahead-addressing-Europeangovernmentshavereducedfinancialsupportforthosebuyingelectricvehiclesandtheirpricehasnotdecreasedthe-ev-cost-hurdle.pdftocompensateforthis.ResearchinDecember2022forKPMG4SeeSwedenprofile.withautomotiveexecutivesinEuropeshowsthattheyhadlowerexpectationsoffuturegrowththanin2021.35‘Mineralsusedinelectriccarscomparedtoconventionalcars’,InternationalEnergyAgency,5May2021.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/charts/minerals-used-in-electric-cars-compared-to-conventional-carsJonathonPeacock,GlobalOil&GasLeader,KPMGinAustralia,saysthatbetterbatteryperformance,improved6‘Railwaypassengertransportstatistics-quarterlyandannualdata’,Eurostat,November2022.h­t­t­p­s://e­c.europa.eu/eurostat/statistics-explained/index.php?title=Railway_passenger_transport_statistics_-_quarterly_and_annual_data7‘Theglobaltramandlightraillandscape2019-21’,UITP(InternationalAssociationofPublicTransport),May2023.h­t­t­p­s://c­m­­s.uitp.org/wp/wp-content/uploads/2023/06/Statistics_Brief_-LTR-update.pdf8Comparisonofdatafor12weeksfrom1Aprilfor2019and2023(reportingperiods1-3)foralltransporttypes,‘Publictransportjourneysbytypeoftransport’,TransportforLondon,24June2023.h­t­t­p­s://d­a­t­a.london.gov.uk/dataset/public-transport-journeys-type-transport16NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsAviationManufacturersaredevelopingelectric-Asasector,aviationhaslongtimelines.Forexample,givenapoweredaircraftbutsuccessfulfocusonsafety,thesectoriscautiousonchangingtheweightofbatteriesregulationsandprocesses,whileaircraftbuiltnowarestilllikelymeansthesearetobeinserviceinthe2040s.“2050asthenetzerotargetlikelytoserveonlyonisprettymuchtomorrowforthissector,”saysChristophershortflightsfortheBrown,Partner,AviationStrategy,KPMGinIreland.foreseeablefuture.Aviation’splanstoAirlinesaremostlyreliantonmanufacturers,airtrafficcontrolreachnetzerobyandfuelproducersinreducingtheiremissions.However,there2050,adoptedbythearesomeoptionstheycantake.Thebiggest‘quickwin’istoInternationalCivilreducetheformationofcondensationtrailsorcontrails,whichAviationOrganizationresearchsuggestsmaycontributetocomparableamountsof(ICAO)inOctober2022,atmosphericwarmingasthecarbondioxidefromfuel.1UAErestprimarilyonairlineEtihadisintroducingtechnologythatadvisespilotsadoptingsustainableonrouteandaltitudechangesthatavoidconditionswhereaviationfuel(SAF).contrailsaremorelikelytoform.2electricity.E-fuelslookeasiertoproduceonalargescale,asManufacturersaredevelopingelectric-poweredaircraftbutunlikebiofuelstheyarenotconstrainedbycroplandandorganictheweightofbatteriesmeansthesearelikelytoserveonlyonwasteavailability,althoughtheywouldrequiresignificantshortflightsfortheforeseeablefuture.Aviation’splanstoreachamountsoflowcarbonelectricitythatmostgridsdonothavenetzeroby2050,adoptedbytheInternationalCivilAviationtospareatpresent.4Organization(ICAO)inOctober2022,restprimarilyonadoptingsustainableaviationfuel(SAF).TheorganizationsaysSAFwillSAFistypicallyseveraltimesasexpensiveasthekerosenecontribute65percentofdecarbonizationby2050withnewcurrentlyusedbyaircraft,meaningatotalswitchwouldtechnologiesincludinghydrogenandelectricengines,offsetssignificantlyaddtoticketprices.Recentmarketresearchforandcarboncapturemakingupmostoftherest.3However,KPMGhasfoundthatcustomers,whilenotprioritizingaflight’sthisislikelytobechallengingforanumberofreasons,andananalysisoftheenergysector’srampupofplannedSAFproductionsuggeststhistargetisalreadyatrisk.SAF,whichiscompatiblewithexistingaircraftenginesandairportinfrastructure,ismadeeitherfrombiofuelsorsynthetice-fuels,chemicalclonesofkeroseneproducedwithlowcarbon17NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactscarbonenvironmentalfootprintintheirpurchasedecisions,willLogisticsstrategiesarecompatiblewiththeParisAgreementonclimatetolerateincreasesinfaresiftheseareafairreflectionofthechangeandwouldbephasedinoverthreeyears.3InternationalextracostofSAF.5ThemovementofgoodsmaybelessvisiblethanmovinglogisticsprovidersneedtocomplywithEUdirectivestoMovingentirelytoSAFslookstechnicallyfeasiblebutapartpeoplebutithasnearlyasgreatanimpactonclimatechange.operatewithinEuropewhileotherjurisdictionsincludingtheUSfromthecost,doingsoby2050wouldrequirehugeincreasesIn2018roadfreightvehiclesemitted2.4GtCO2globallyareintroducingtheirownstandardsforcorporatereporting.4inproduction:“Itlookslikeataskthatwouldbeexceptionallycomparedwithpassengerroadvehiclesthatproduceddifficulttodeliveron,”saysMalcolmRamsay,GlobalHead3.6GtCO2accordingtotheInternationalEnergyAgency.TheCollectingemissionsdatawillnotbeeasyformanylogisticsofAviation,KPMGinSingapore.Headdsthatgovernmentsorganizationexpectedthatannualroadfreightemissionswouldprovidersgivenhighlevelsofsubcontractinginwhatisacouldsupportthisbyprovidingincentivesforfuelproducerstodeclinebyjust0.1GtCO2by2030,comparedwith0.5GtCO2highlyfragmentedindustry.DrSteffenWagner,GlobalHead,allocatecapitaltoSAFproduction.lessfrompassengerroadvehiclesasthelattershifttoTransport&Leisure,KPMGInternational,saysthataccurateelectricity.1Theweightofbatteriesandlongeraveragejourneyinformationcanhelpcompaniestoreducetheiremissionsand1‘Contrails:Howtweakingflightplanscanhelptheclimate’,BBCNews,22Octoberdistancesmaketruckshardertoelectrifythancarsalthoughcosts,suchasbymakinguseofemptytrucks.Aroundone-fifth2021.h­t­t­p­s://w­w­w.bbc.com/news/business-58769351somevehiclemakershavedevelopedelectricmodels.2oftheEU’sroadfreightkilometersin2020wereusedbyemptyvehicleswithfurtherunusedcapacityinpartiallyemptyones.52‘EtihadAirwaysandSATAVIAcollaboratetoimplementcontrailpreventionfortheLogisticsisalow-marginsectorwheredecisionsareusually“Iftruckingcompaniescollaborate,theycanbetterusetheirfirsttimeonanAtlanticcrossing’,EtihadAviationGroup,10November2022.h­t­t­basedonprice,makingitdifficultforoperatorstoinvestexistingresourcesandreducethecarbonfootprintofindividualp­s://w­w­w.etihadaviationgroup.com/en-ae/newsroom/etihad-airways-and-satavia-indecarbonizationunlessgovernmentsrequirethis.Somegoods,”saysWagner,addingthatthereisatrendtowardscollaborate-to-implement-contrail-prevention-for-the-first-time-on-an-atlantic-suchlegislationiscominginEurope,requiringcompaniesusingonlineplatformstomatchcompaniesthathavesparecrossingtocollectandpublishdataontheiremissionsunderthecapacitywiththoserequiringit.LogisticsproviderscanalsoCorporateSustainabilityReportingDirectivethatcameintocutemissionsbyinstallingrooftopsolarpanelsonwarehouses3‘Developingsustainableaviationfuel(SAF)’,InternationalCivilAviationforceinJanuary,aswellasaproposeddirectiveoncorporateandusingelectricallypoweredrobotswithinthem,aswellasOrganization.h­t­t­p­s://w­w­w.iata.org/en/programs/environment/sustainable-sustainabilityduediligence.Thelatterwouldinitiallyobligemakinggreateruseofroad-to-railfacilitiesthattransferfreightaviation-fuels/companiesturningovermorethan300millioneuros(EUR)torailwaysforpartsofjourneys.(US$318million)toensuretheirbusinessmodelsand4‘Sustainableaviationfuel’,KPMGinIreland,November2022.https://kpmg.com/ie/en/home/insights/2022/11/sustainable-aviation-fuel.html1‘TransportsectorCO2emissionsbymodeintheSustainableDevelopmentScenario,2000-2030’,InternationalEnergyAgency,updated27May2019.h­t­t­ps://w­w­w.iea.org/data-and-statistics/charts/transport-sector-co2-emissions-by-mode-in-the-sustainable-development-scenario-2000-20305‘Whopaysforaviation’sdecarbonization?’,KPMGinIreland,August2023.https://kpmg.com/ie/en/home/insights/2023/08/aviation-2030-series-who-pays-2SeeSwedenprofile.for-aviations-decarbonization-fs-aviation.html3‘TheEU’sCorporateSustainabilityDueDiligenceDirective’,February2023,KPMGInternational.https://kpmg.com/xx/en/home/insights/2023/02/the-eu-corporate-sustainability-due-diligence-directive.html4Seesectiononclimateandsustainabilityreporting.5‘Afifthofroadfreightkilometresbyemptyvehicles’,Eurostat,10December2021.h­t­t­p­s://ec.europa.eu/eurostat/web/products-eurostat-news/-/ddn-20211210-118NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsShippingAJulymeetingoftheIMO’smemberstatesinLondonadoptedGiesesaysthatlinersarechoosingdifferenttypesoflowanetzerostrategythatincludesdevelopmentofapricingcarbonfuelassuppliesofeachareconstrained,butthisLikeaviationshippingisasectorthatchangesslowly,partlymechanismformaritimeemissionsoverthenextfewyears.3fragmentationcouldmakeitdifficultforenergycompaniestoduetodifficultiesregulatinganinherentlyinternationalbusinessGieseaddsthattheIMO2020sulfurruleshowsachallengetosupplyallofthematlargescales.“Itisgettingbetter,butthereandpartlyasvesselsremaininserviceforseveraldecades.thisinthatcountriesmayintroducedifferentlevelsofpenalties,isstilladisconnectbetweenenergycompaniesandtheliners,”Thereareregulatorychangestakingplace,includingtheEUwithSingaporethreateningtwo-yearprisonsentencesandshesays,addingthatmanyintheshippingindustrywouldphasingintheuseofitsemissionstradingsysteminmaritimefinesofupto10,000Singaporedollars(SGD)(US$7,340)forwelcomefurtherregulationinthisarea.transportbetween2024and2027foralllargeshipsthatuseusingnon-compliantfuelwhileothercountrieshavemuchthebloc’sportsregardlessofflagofregistration.Thiswilllikelysmallerfines.4ItwilltakeseveraldecadesforshippingtomovetolowcarbonrequirevesseloperatorstobuyEUETSallowancescoveringallfuelsasvesselsaretypicallyinservicefor20to30yearsandofthegreenhousegasemissionsgeneratedwhileinEUportsBatteriescanpowervesselsforshortjourneysmakingthemoftencannotberefittedtousealternativefuels.Increasingandonvoyagesbetweenthem,aswellashalfoftheemissionssuitableforsomeferries,butlong-distanceshippingwillrequireefficiencythroughbettercollaborationandgreatertransparencyfromjourneysthateitherstartorendintheEU.1lowcarbonfuels.Theworld’slargestinternationalshippingoffersquickerbenefits.TheseweretheaimsofTradeLens,companies,knownasliners,aremakingdifferentchoicesoveradigitalplatformdesignedtosupportdatasharingbetweenMoniqueGiese,GlobalHeadofShipping,KPMGInternational,whichfuelstointroduce.Denmark-basedMaerskhasorderedorganizationsinvolvedinsupplychains,butinNovember2022saysthatwhileEUETSoffersaregionalsolution,the19vesselsthatrunongreenmethanol.5Swiss-headquartereditsfoundersMaerskandUS-headquarteredtechnologyproviderInternationalMaritimeOrganization(IMO)islikelytoholdMSCalreadyusesbiofuelsaspartofblendedfuelsandisIBMannounceditsclosure.8GiesesaysTradeLenssufferedfromthekeytoaglobalone.TheIMO2020ruletocutcoastalinterestedindevelopinguseofhydrogen.6InFebruary2023alackoftrustbetweenorganizationsandregulatoryconcernsairpollutionfromsulfurinfueloilcouldprovideamodelforGermany-basedHapag-Lloydannounceditwillworkwithoversharingdata.“ButtheideawasbrilliantandIwouldguessreducingthesector’sgreenhousegasemissions.ItwasUK-headquarteredenergygroupShellondevelopinguseofthatwewillseesomethingsimilarinthenearfuture,”shesays.introducedthroughanamendmenttotheInternationalbiomethaneandliquifiede-methane.7CountriesinAsiaareConventionforthePreventionofPollutionfromShipsandaheadoftherestoftheworldinbuildinginfrastructuretohasledtovesselsadoptingverylowsulfurfuelsorinstallingsupplyshipswithliquidnaturalgas(LNG),aloweremissionexhaustgascleaningsystems.2fossilfuel.1‘Reducingemissionsfromtheshippingsector’,EuropeanCommission.h­t­t­p­s://climate.ec.europa.eu/eu-action/transport/reducing-emissions-shipping-sector_en2‘IMO2020—cuttingsulphuroxideemissions’,InternationalMaritimeOrganization.h­t­t­p­s://w­w­w.imo.org/en/MediaCentre/HotTopics/Pages/Sulphur-2020.aspx3‘InternationalMaritimeOrganization(IMO)adoptsrevisedstrategytoreducegreenhousegasemissionsfrominternationalshipping’,InternationalMaritimeOrganization,7July2023.h­t­t­p­s://w­w­w.imo.org/en/MediaCentre/PressBriefings/pages/Revised-GHG-reduction-strategy-for-global-shipping-adopted-.aspx4‘InSingapore,high-sulfurfuelcouldleadtoprison’,MaritimeExecutive,3April2019.h­t­t­p­s://w­w­w.maritime-executive.com/article/in-singapore-high-sulfur-fuel-could-lead-to-prison5SeeDenmarkprofile.6BudDarr,‘Roadmaptoazero-carbonfuture’,MSC,2March2021.h­t­t­p­s://w­w­w.msc.com/en/newsroom/stories/roadmap-to-a-zero-carbon-future7‘ShellandHapag-Lloydcollaborateonmarinefueldecarbonisationandsignmulti-yearLNGsupplyagreement’,Hapag-Lloyd,27February2023.h­t­t­p­s://w­w­w.hapag-lloyd.com/en/company/press/releases/2023/02/shell-and-hapag-lloyd-collaborate-on-marine-fuel-decarbonisation.html8JacobGronholt-Pedersen,‘Maersk,IBMdiscontinueshippingblockchainplatform’,Reuters,29November2022.h­t­t­p­s://w­w­w.reuters.com/technology/maersk-ibm-discontinue-shipping-blockchain-platform-2022-11-29/19NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsIndustryIndustrialmanufacturingAnotheroptionistoreplaceexistingblastfurnaceswith“Whilethereisnosilverbulletforachievingnetzeroinelectricarcfurnaces(EAF),abroadlyadoptedtechnologyindustrialmanufacturing,acomprehensivetechnologyportfolioIndustryishistoricallyamajorproducerofgreenhousegasthatincreasescircularitybyrelyingonscrapsteelasitsmainisbeginningtotakeshape.Whilethecosttoachievethisgoalemissions,meaningthatindustrialdecarbonizationisaleverinput.Asanexample,supportedbytheFrenchgovernment,addsuptoasubstantialportionofglobalGDP,thecostofcanmakeasignificantimpactineffortstoreachnetzero.OverArcelorMittalisinvestingEUR1.7billion(US$1.81billion)inactionwouldfarsurpassit,giventheincreasinglytangiblethelastdecadehowever,industrialmanufacturingthroughbuildingEAFsatFos-sur-MernearMarseilleandDunkirk,asandvisibleimpactsofclimatechange,”hesays.newinnovationsinthefieldofenergy-savingtechnologieswellasahydrogen-poweredunitinDunkirk.Thecompanysaysandacceleratedshiftofmanufacturingequipment’spoweringthistransformationwillcutemissionsby7.8MtCO2ayear,a“PoliciessuchasEurope’sGreenDealandNetZeroIndustryfromfossilfuelstoelectricityhasdecisivelyrepositioneditselftenthofthetotalfromFrenchmanufacturingindustry.1GermanActandtheUSInflationReductionActareshowingpathsasbeinganessentialpartofthesolutiontoreachtheworld’ssteelmakerSalzgitterisworkingtopoweritsblastfurnacesforwardbutultimatesuccesswillrequireunwaveringambitiousnetzerotargets.withgreenhydrogenproducedfromrenewableenergy,whichcollaborationbetweengovernment,privatebusinessanditsayscouldcut95percentofthe8MtCO2annualemissionsindustryplayers,”Souchetadds.SteelproducedthroughtheblastfurnaceprocessreleasesCO2fromitssteelworksatacapitalcostofEUR2billionequallythroughthemeltingofcokeandironoreathightemperatures.sharedbetweenbythecompanyandpublicfundingfromItisbeingradicallytransformedthroughthedevelopmentofGermany’sfederalgovernmentandthestateofLowerSaxony.2so-called‘greensteel’wherecarbonisreplacedbyhydrogenthatifproducedwithlowcarbonenergycanturnironoreintoStéphaneSouchet,GlobalHeadofIndustrialManufacturing,manufacturedsteelwithfarfeweremissions.ThechallengeKPMGInternational,sayswhathasbecomeincreasinglybeingaddressedbysteelindustryleadersaswellaslowclearsinceCOVID-19andinflationexacerbatedbythewarincarbonenergyprovidersistoscaleupsuchtechnologiesUkraineisthatgovernmentpolicyinterventionstoacceleraterequiredtoleadtocommerciallyviablesteelproduction.energytransitionareinfullswinginmostmajoreconomies.CurrentlythecostdisadvantagestillrequiresmassivesubsidiesGovernmentsarenowdemonstratingawillingnesstoinvestinthatrequirepublic-privatesectorinitiatives.industrialdecarbonizationatlevelsnotseenbefore.1‘ArcelorMittalacceleratesitsdecarbonisationwitha€1.7billioninvestmentprogrammeinFrance,supportedbytheFrenchGovernment’,ArcelorMittal,4February2022.h­t­t­p­s://corporate.arcelormittal.com/media/press-releases/arcelormittal-accelerates-its-decarbonisation-with-a-1-7-billion-investment-programme-in-france-supported-by-the-french-government2‘SALCOS’,SalzgitterAG.h­t­t­p­s://salcos.salzgitter-ag.com/en/index.html20NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsBuildingswhopaysforthis.ItispossibletoconvertnewernaturalbuildingenergyperformanceissettorequireownersofthegasboilerstousegreenhydrogenproducedwithrenewableleastefficientbuildingstocarryoutimprovementsovertheHomeheatingelectricity,butdoingsowouldinvolvebigincreasesinnextfewyearsaswellasinsistingthatnewbuildingsmusthydrogenfuelproduction.GovernmentsincludingGermanyandhavezeroemissionsby2030.5SouthKoreaalreadyrequiresInmanycountries,heatingistheresidentialsector’smaintheUK,whichalsoreliesheavilyonnaturalgasfordomesticnewbuildingstoincluderenewablegenerationandwillenergyrequirement,withnearlyfour-fifthsofEUhouseholdheating,haveproposedelectricalheatpumpsasthebestrequireoperatorsofexistingpublicsectorbuildingstoaddthisenergyusedtoheatspaceandwater.Sourcesofhomeoptiontoreplacegasboilers.FewBritishhomeownershavefrom2025.6energyandsubsequentemissionsvarygreatlyfromcountrytoyetinstalledaheatpumpwithonlyafractionofthecostscountry.Norwegianhomesgetthree-quartersoftheirenergymetbygovernmentsubsidiesandmanypropertiesbeingOwnershipofbuildingsisoftensplitbetweenarelativelysmallfromlowcarbonelectricitywithalmostalltherestcomingunsuitable.3InGermany,publicoppositiontorecentplanstonumberofinstitutionalownersthataremorelikelytohavefromrenewablesandbiofuels.DenmarkandSwedengetaboutbantheinstallationofnewgas-firedboilersfrom2024forcedresourcesandexpertisetodecarbonizeproperties,aswellathirdoftheirdomesticenergyfromderivedheatsystemsthegovernmenttoallowexemptionsforboilersthatcouldbeasincreasingrequirementstoreportonnetzerotargets,andsuchasdistrictheating,withmostoftherestfromelectricity,convertedtohydrogen.4amuchlargergroupofprivateowners.Thelatteraremorerenewablesandbiofuels.Naturalgasprovides53percentoflikelytofindithardertopayforandmanageimprovementstheenergyusedbyhomesinItalyand43percentinGermany,Buildingefficiencyandtheycanbemoreresistanttochange,giventheirnumberwhile42percentofIrishhomeenergycomesfromoilandandresultinglyloudercollectivevoice.Switzerland,whichhaspetroleumproducts.1CountrieswithdispersedpopulationsRegardlessofsource,manybuildingsmakepooruseofheatpassedaclimatelawrequiringthatemissionsfrombuildingsandcolderclimatessuchasCanada,aswellasruralareasinenergyduetolowlevelsofinsulationorolddesigns.Thisisfallby82percenton1990levelsby2040,hasseensomemanycountries,mayfinditdifficulttomoveawayfromoilandaparticularproblemfornationalnetzerotargetsoforaroundinstitutionssellinginefficientbuildingstoprivateinvestors.7naturalgasfordomesticheatingunlessthesecanbereplaced2050asbuildingstendtolastfordecadesandconstructingwithsimilarlyenergy-denseandtransportablefuels.2newonesisitselfacarbon-intensiveprocess,makingDecarbonizingcitiesrenovationofexistingbuildingsastrongoption.In2021,theDecarbonizingresidentialheatingthatreliesonfossilfuelswillEuropeanCommissionsaidthat75percentofbuildingsinMorethanhalfoftheworld’spopulationlivesinurbanareasusuallyrequiresignificantworktobecarriedoutinindividualtheEUarenotenergyefficientbutthat85to95percentofandthisislikelytorisetotwo-thirdsby2050.Citiesarehomes,causingpoliticalproblemsoverbothdisruptionandthoseinusenowwillstillbestandingin2050.Itsdirectiveondenselypopulatedcentersofgovernmentandbusiness,makingthemgoodlocationsforinnovativeworkinthis1‘Energyconsumptioninhouseholds’,Eurostat,June2023.h­t­t­p­s­:­/­/e­c­.e­u­r­o­p­a.e­u/­e­ur­ost­at/statistics-explained/index.php?title=Energy_consumption_in_households#Energy_area.Therearespecificreasonsforfocusingoncities,withconsumption_in_households_by_type_of_end-userenewableenergy-basedsystemssuchasdistrictheatingworkingbetterindenseurbanareasandlargebuildings2SeeCanadaprofile.possessingeconomiesofscaleforretrofittingnewglazing,3SeeUKprofile.heatingandcoolingsystems,energymanagementtechnology4SeeGermanyprofile.andon-siterenewableproduction.InNovember2022KPMG5‘Makingouthomesandbuildingsfitforagreenerfuture’,EuropeanCommission,15December2021.h­t­t­ps://e­c.e­u­ropa.eu/commission/presscorner/detail/en/fs_21_6691launchedtheNetZeroUrbanProgram8thataimstohelpraise6SeeSouthKoreaprofile.capitalandapplydigitaltechnologiestoprototypeprojectsthat7SeeSwitzerlandprofile.cansupporturbandecarbonization.98‘NetZeroUrbanProgram’,KPMGInternational.https://kpmg.com/xx/en/home/insights/2022/10/net-zero-urban-program.html9‘Theroleofenergyandutilitiesinachievingnetzerocities’,PluggedInmagazine,KPMGInternational,March2023.https://kpmg.com/xx/en/home/industries/energy/power-utilities/plugged-in-magazine-2/the-role-of-energy-and-utilities-in-achieving-net-zero-cities.html21NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsInfrastructureJustasinnature,evolutionwilltakemultiplepathsashumanityHowever,therearetrendsthatlooklikelytoreshapemovestowardsnetzero,withsomethatwillworkandsomeinfrastructureinwaysthatmaysupportdecarbonization,Infrastructuretendstogetmuchlessattentionthanthethatwillbedeadends,soitwouldbefoolhardytostandidleuntilalthoughthesewillvarysignificantlybycountryandregion.productsandservicesdirectlypurchasedbyindividualstheperfectsolutionisfound.Itmakessensetoadoptalready-Whatthesechangeslooklikeinspecificregionsandandorganizations.However,basedonabroaddefinitionproventechniquessuchasmodernmethodsofconstruction,jurisdictionswillresultfromtheiruniqueconditionsandinfrastructureisresponsiblefor79percentofallemissionswhichtransfersomesmaller-scaleworktofactoriesthatprovidethewaystheirsocietiesrespondtotheneedforchange.andwilltakeup88percentofthecostsofadaptingtoclimateunitsforon-siteassembly.ThismakesconstructionmoreForexample,millionsofpeoplewereforcedtoworkfromchange,accordinga2021reportproducedbytheUNOfficeefficient,reducingtotalcarbonoutputthroughtheuseoffewerhomeduringtheCOVID-19pandemicandsomerealizedforProjectServices,UNEnvironmentProgrammeandtheresourcesasopposedtonewmaterials.theypreferredtodosoatleastsomeofthetime,withtheUniversityofOxford.Thewatersectoralonewillrequireperiodalsohighlightingthepotentialforremotemeetings54percentofalladaptationspendingtoreducerisksfromInfrastructureismorelikelytomakeprogresstowardsnetandcollaboration.Increasedhomeworkingandremoteflooding,sealevelrises,stormsurgesandotherimpacts.1zerobytakingmanysmallstepsratherthanafewbigones.collaborationislikelytochangedemandforbothcommuterGovernmentscanplayarolenowbysupportingpathfinderandandbusinesstransportandtheinfrastructurerequiredtoAlotofinfrastructurerequirestheuseofconcrete,withitskeydemonstrationprojectsandbyinstructingregulatorstotakesupportit.5Somenewinfrastructuremaybeneededtoingredientcementaccountingforaround7percentofglobalapragmaticapproach,suchasconsideringthedamagefromsupporthomeworkerswhospendmoreormostoftheirtimeemissions,twiceasmuchasaviation’stotalcontribution.2Thisisglobalclimatechangeaprojectcouldhelptacklealongwiththeinthesametownorsuburbratherthantravelingregularlyduetothecurrentneedforfossilfuelstogeneratetheveryhighimpactsitwouldhaveonthelocalenvironment.toacitycenter.Similarly,movestoshortensupplychainstotemperaturesrequiredinitsproduction.WhilethereareoptionsmanufacturegoodsclosertocustomerscouldrequirechangestoreduceemissionsfromconcretealittlebychangingsomeInfrastructureprojectstypicallytakeyearsordecadestogettothescaleandshapeofinfrastructureatandnearports.materials,‘mineralizing’orcapturingcarbondioxidegeneratedfrominceptionthroughplanning,approvalandconstructionwithinfinishedconcretecouldturnitintoamaterialthatremovestocompletionanddelayshavealwaysbeencommon.Thegreenhousegasesfromtheatmosphereratherthanaddstoresultingassetsareoftenusedfordecadesorevencenturies,them.3However,thisisatanearlystageofdevelopmentwithmeaningthatforexampleroadschangeslowlycomparedwithaUSstartupmineralizingjust30kilogramsofcarbondioxideintheincreasinglyelectricallypoweredvehiclesthatusethem.concreteinatestannouncedinFebruarythisyear.41‘Infrastructureforclimateaction’,UNOfficeforProjectServices,UNEnvironmentProgrammeandUniversityofOxford,October2021.h­t­t­ps://content.unops.org/publications/Infrastructure-for-climate-action_EN.pdf2‘Aviationcontributes3.5%tothedriversofclimatechangethatstemfromhumans’,ManchesterMetropolitanUniversity(UK),3September2020.h­t­t­p­s://w­w­w­.mmu.ac.uk/news-and-events/news/story/12787/3‘Concrete’,MITClimatePortal.h­t­t­p­s://climate.mit.edu/explainers/concrete4PeterHenderson,‘ConcretetrapsCO2soakedfromairinclimate-friendlytest’,Reuters,4February2023.h­t­t­p­s://w­w­w.reuters.com/business/sustainable-business/concrete-traps-co2-soaked-air-climate-friendly-test-2023-02-03/5‘Insightsoncurrenttrendsinremoteworking’,KPMGInternational,March2022.https://kpmg.com/xx/en/home/insights/2022/03/insights-on-current-trends-in-remote-working.html22NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsOilandgasonthegroundsofself-relianceandeconomicdevelopment,includingsomecountrieswithrelativelystrongrecordsonThelasttwoyearshaveseensharpfluctuationsinthecostdecarbonization.Forexample,inJuly2023theUKsaiditwillofoilandnaturalgas,primarilybecauseofRussia’sinvasionissuehundredsofnewoilandgaslicensesforitsNorthSeaofUkraineinFebruary2022andtheresultingremovalofwaters,arguingthatthecountrywillstillobtainaquarterofitsRussiannaturalgasfromenergymarkets,alongwitheconomicenergyfromthesesourcesin2050whenitreachesnetzerorecoveryfromtheCOVID-19pandemic.Themonthsfollowingandshouldthereforereduceitsrelianceonhostilestates.2theinvasionsawthehighestaveragecrudeoilpricessince2013andthecostofnaturalgasinEuropetriplingtosetnewHigherpriceshaveledtohigherincomeforgovernmentsrecords,althoughthesepriceshavesincereturnedtolevelsfromtaxesandroyaltiesandsomeareinvestingthisinneartheirlong-termaveragesduetofactorsincludingChina’sdecarbonization.TheAustralianstateofQueenslandisusingsloweconomicrecovery.revenuesfromnaturalgasandminingtosupportrenewableprojectsthroughloansandgrants,withatargettoincreaseWhilenon-hydroelectricrenewablegenerationincreasedbyrenewableproductionbyeighttimesbetween2022and2035nearlyapercentagepointto7.5percentin2022,theworldthroughnewsolar,wind,pumpedhydrostorageandgridcontinuedtodependonfossilfuelsfor82percentofitsupgrades.3Somecountrieshaveintroducedsignificantfinancialprimaryenergy.1GivenoverallglobaldemandsforenergyareincentivesforsuchworkincludingtheInflationReductionActwidelyexpectedtoincreaseoverthenextdecade,oilandgasintheUSortheEU’sGreenDealwhileothersincludingJapanproductionlookslikelytoplayasignificantroleforsomeyearsandSouthKoreaarestronglyencouragingtheircompaniestotocome,evenaslowcarbonsourcesincrease.undertakeit.Inaddition,aneraofvolatileandcomplexgeopoliticalAnevolvinglicenseforcompaniesrelationshipshascausedmanycountriestolookforwaystoreducetheirdependenceonpotentiallyhostilenations.ThisIncreasedpriceshavealsoprovidedoilandgascompanieswithincludesinvestingintheirownenergysectorsasawayofmuchmorecapital.Several,particularlythoseheadquarteredincreasingtheir‘energysovereignty’sotheyarelesslikelyinEurope,areinvestingsomeofthisindevelopingwaystotofindthemselvesinthepositionofEuropeancountriesthatdecarbonizecustomeruseoftheirfuelsthroughtechnologiesurgentlysoughtnewsuppliesfollowingtheremovalofRussiansuchasgreenhydrogenproduction,carboncapture,utilizationgas.Suchinvestmentsincludesecuringoilandgassuppliesandstorage,biomassandbiogas.Somearealsoinvestingin23NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsrenewablegeneration.JonathonPeacock,GlobalOil&Gasofproductsratherthanthosegeneratedbycustomeruse,Theuseofoilinproducingplasticsandgasinammonia-Leader,KPMGinAustralia,saysthisshowsanevolutioninhowknownasscope3emissions,andgenerallyhavehighermarketbasedfertilizersaswellastheircurrentdominanceofenergysocietiestreatthesecompanies:“Youcancontinuetoproducevaluationsthanthosewithastrongerfocusoncustomermeansbothfuelswillcontinuetobeneededuntilsocietieshydrocarbonsprovidedyoucandemonstrateapositiveintentdecarbonization.Thoseoilandgascompaniestryingtomovedecidetostopusingderivedproductsorresearchersfindonhowyouplantoorarereducingemissions,”hesays,partlytonewtypesofenergyproductionarebeingaffectedbyaadequatesubstitutes,somethingwhichwilltaketime.Peacockdrivenbycarbonpricinginsomecountriesaswellaspressurepolarizationininvestorviewsbetweenthosewhowantthesaysthatoilandgascompaniesarewell-placedtoworkonfromstakeholdersincludingemployees,communitiesandsectortodeliverreliablereturnsfromfossilfuels,increasinglydecarbonizingtheirproductsastheyhavethecapitaltoinvestactivistshareholders.fromprojectswithrelativelyshorttimeframes,andthosewhoinresearchanddevelopment,areusedtoworkingacrossavoidthesectorcompletelybecausetheydonotthinkitsbordersandhaveanengineering-ledapproachtodeliveringButthesetechnologiesareatearlystagesofdevelopmenttransitionplansarestrongenough.results.“It’snotoilandgasorrenewables,”hesays.“Theyandrepresentrelativelyriskyinvestments,whichmayormayhavegottoworktogether.”notofferstrongreturns.“CompaniesarestilltryingtoworkPeacockaddsthattherearebroaderreasonsforrichcountriesoutwhatthemosteconomicallyviablemeansofemissionsandcompaniestoworkondecarbonizationtechnologies,asreductionlookslike,”saysPeacock.“Itvariesbygeography,thesecouldhelpprovidepoorercountrieswithgreen,safeandgeologyandgovernmentpolicy.”HeaddsthatUS-basedoilreliablesourcesofpower,includingthe2.4billionpeoplewhoandgascompaniesgenerallyfocusonminimizingscope1lackaccesstocleanly-fueledcookingfacilities.4andscope2emissionsfromproductionandthecomposition1‘2022keyhighlights’,StatisticalReviewofWorldEnergy2023,EnergyInstitute.h­t­t­p­s://w­w­w.energyinst.org/statistical-review2‘HundredsofnewNorthSeaoilandgaslicencestoboostBritishenergyindependenceandgrowtheeconomy’,UKPrimeMinister’sOfficeandDepartmentforEnergySecurityandNetZero,31July2023.h­t­t­p­s://w­w­w.gov.uk/government/news/hundreds-of-new-north-sea-oil-and-gas-licences-to-boost-british-energy-independence-and-grow-the-economy-31-july-20233‘Queenslandenergyandjobsplanoverview’,QueenslandGovernment,September2022.h­t­t­p­s://w­w­w.epw.qld.gov.au/__data/assets/pdf_file/0031/32989/queensland-energy-and-jobs-plan-overview.pdf4‘WHOpublishesnewglobaldataontheuseofcleanandpollutingfuelsforcookingbyfueltype’,WorldHealthOrganization,20January2022.h­t­t­p­s://w­w­w.who.int/news/item/20-01-2022-who-publishes-new-global-data-on-the-use-of-clean-and-polluting-fuels-for-cooking-by-fuel-type24NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsAgricultureAswithothersectors,theRussiangovernment’sFebruary2022Newprocesses,newrelationshipsinvasionofUkraineputglobalagricultureunderstress.Ukraineisamajorproducerofgrainandoilseedaswellastheworld’sThecurrentlackofoptionsmaychangegivenpromisinglargestsourceofsunfloweroilandthesecondlargestsupplierdevelopmentsonreducingemissionsfromagriculture,totheUNWorldFoodProgramme,whileRussiahasbeenabigmanyofwhichcomefrommethaneandnitrousoxideasproducerofwheat,seedoilandfertilizeringredients.Disruptionwellascarbondioxide.ResearchersareworkingonwaysinUkraine,sanctionsonRussiaandsharplyincreasingenergypricescausedbytheconflictlookedlikelytoaccelerateaHowever,emissionsshiftbyfarmersworldwidetowardsregenerativeagriculturefromagriculturehavethatuseslessenergyandinputssuchasfertilizer.1Instead,ittakenanincreasinglyhasencouragedfarmerstoimproveefficiencybyfocusingonhighprofileasotherhowtoproducemorewithsimilarorlowerlevelsofinputs.sectorsmakebigThisreducesemissionsintensities—levelsofgreenhousechangestoaddressgasesgeneratedforeachunitofoutput—buthasnotmadeaclimatechange.Iansignificantdifferencetooverallvolumes.Proudfoot,GlobalHeadofAgribusiness,However,emissionsfromagriculturehavetakenanincreasinglyKPMGInternational,highprofileasothersectorsmakebigchangestoaddresssaysthatatpresentclimatechange.IanProudfoot,GlobalHeadofAgribusiness,thesectorisunableKPMGInternational,saysthatatpresentthesectorisunabletomaketheobvioustomaketheobviouschangesequivalenttoabuscompanychangesequivalenttoareplacingdieselvehicleswithelectricones.“Youcan’tswapbuscompanyreplacingonecowforalower-emissionscowatthecurrenttime,”hedieselvehicleswithsays.“Agriculturehasbeenfoundwantingonnotnecessarilyelectricones.havingtheanswersastohowtostartitsjourneytoalower-emissionsfuture.”Whilesomeadvocatereplacingtheoutputofdairyandlivestockfarmingwithplant-basedalternatives,doingsocandeprivepeopleofproductsthattheyenjoyandthatcontributetoanutritionallybalanceddiet.25NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactstotreatdairyfarmingeffluentthatcanpreventnearlyallSomeretailersandfoodprocessorsarechangingthewaytheyFarm-levelanswersmethaneemissions.2Thiseffluentcouldalsobeusedtoworkwithfarmers,movingfromshort-termcontractsbasedproducebiofuelsthroughanaerobicdigestionandfarmingprimarilyonpricetolonger-termpartnerships.ThesecanNewZealand’sgovernmenthasworkedwithorganizationsco-operativesinEuropeandtheUnitedStatesarelookingatgivebuyersmoresecurityoversuppliesaswellasprovidingrepresentingfarmersandgrowerstodevelopaplanforhowtheycouldhelptheirmemberstakeadvantageofthis.3financialstabilityforfarmerstoinvestinreducingtheclimateemissionspricingatthelevelofindividualfarms,althoughthisEmissionsfromcattlecanalsobereducedbyaddingseaweedimpactoftheiroperations.Insomecases,suchcompaniesisstillundernegotiation.6RegardlessoftheoutcomeinNewtotheirfood,withresearchonthistakingplaceincountriesaresupportingtheirfarmersfinanciallytolowertheirZealand,ProudfootsaysthatrewardingindividualfarmersincludingAustralia,Ireland,theUSandtheUK.4Thisisoneemissionsbyadoptingnewequipmentorprocesses,helpinglookslikethebestwaytoreduceemissionsinthesector,ofarangeof‘blueeconomy’opportunitiesthatinvolveusingtoreducetheirscope3supplieremissions.However,manygiventheyhaveledagriculturalinnovationforthousandsofoceanstoreduceorsequestergreenhousegases.5Morefoodretailershaveastrongfocusonpricesandarecurrentlyyearsandhavestrongincentivestoprotecttheirlands,oftenbroadlyfarmerswillincreasinglybeabletoprovideecosystemunderpressuretoprioritizelowpricesbypoliticiansconcernedtheirmainasset.Governmentsshouldencouragefarmerstoservicesfromthecarbontheyareabletosequesterwithinaboutthecostofliving.collaborateinternationallyandwithpartnersincludingfoodtheirfarmingsystems,creatinganewrevenuestreambyprocessorstofindnewwayscuttheirownemissionsandsellingverifiablecarboncreditstooffsetemissionsfromsequesterthemforothers:“Wehavegottounleashfarmerssectorsthatwillneverbeabletobecomeclimatepositiveintobeahugepartofthesolution,ratherthanexpectingthemthewaythatbiologicallybasedsectorscanaspiretobe.toadoptwhatevergetsgiventothem,”hesays.1IanProudfoot,‘Ukraine-Russiasectorconsiderations:Agriculture’,KPMGInternational,May2022.https://kpmg.com/xx/en/home/insights/2022/05/ukraine-russia-sector-considerations-agriculture.html2‘LincolnUniversityscientistsdevelopgamechanginggreenhousegasemissionreductiontechnology’,LincolnUniversity(NewZealand),11November2021.h­t­t­p­s://w­w­w.lincoln.ac.nz/news-and-events/lincoln-university-scientists-develop-game-changing-greenhouse-gas-emission-reduction-technology/3NatalieLong,‘Rethinkingmethane:Dairyfarmerscaptureanopportunityforleadership’,LandO’Lakes,25August2022.h­t­t­p­s://w­w­w.landolakesinc.com/Blog/August-2022/reducing-methane-emissions-in-agriculture4‘Seaweedusedtofeedcattleintrialaimedatcuttingmethaneemissions’,RTE,10November2021.h­t­t­p­s://w­w­w.rte.ie/news/regional/2021/1110/1259109-seaweed-cattle-feed/5‘SeeBlueeconomysection’,KPMGInternational,June2023.https://kpmg.com/xx/en/home/insights/2021/05/you-cant-go-green-without-blue.html6SeeNewZealandprofile.26NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlloobbaallsseecctotorrsusummmmaraiersiesCountryprofilesAboutKPMGESGKPMGcontactsBlueeconomyJoshHasdell,HeadofGlobalBlueEconomyServices,KPMGinCanada,saystheagreementisindicativeofashiftawayfromGovernmentsareincreasinglylookingtotheworld’soceansandseeingoceansandcoastsasplacesforconservation.“It’smovedcoaststosupporttheirmovestowardsnetzero.Oceansalreadyonfrom‘let’sprotectouroceansandkeepourbeachesclean’toprovidetheplanet’slargest‘carbonsink’byabsorbing25percentseeingoceansasfundamentaltooursurvivalandmeetingournetofallcarbondioxideemissionsand90percentoftheexcessheatzerogoals,”hesays.“Wecan’tgogreenwithoutblue.”6Headdstheygenerate,withmangroveforestsontropicalandsubtropicalthattherearechallenges,includingreliableverificationofcarboncoastsbeingsomeofthemostefficientecosystemsforstoringsequesteredthroughcoastalecosystemsandtheoceansandacarbon.1Byincreasingareascoveredbymangrovesandotherlackoffundingforsuchprojects.naturalcarbonsinks,countrieswithsuitablecoastlinescouldbenefitfinanciallybyhelpingtomeetrapidlygrowingdemandforAswellassequestration,oceansincreasinglyhostrenewablecarbonassetswhileenjoyingnature-relatedbenefitsincludingpowergenerationintheformofoffshorewind.Thereisbetterfloodprotectionandanimprovedmarineenvironment.2potentialtogomuchfurther,includingwithfloatingsolarfarms,technologiesthatharnesstides,wavesandcurrentsandtheAlternativesincludeprotectingandencouragingthespreadofexploitationofdifferencesinoceantemperaturesandsaltunderwaterseaweedforests,whichCanadiancharityOceanWiseconcentrations.7Wildfisheriesprovidealowcarbonsourcesayscansequestercarbonmoreeffectivelythanplantingtrees.3ofproteinaswellaslocaljobs.8WhilethereispotentialtoThereisalsopotentialtoenhancetheopenocean’snaturalcarbonminemineralsfromoceanfloors,theriskofcausingseveresinkfunctionthroughmethodsincludingenhancingalkalinity,environmentaldamagemeansthatcountriesshouldbehighlyencouragingfertilizationandinjectingcarbondioxide,althoughcautiousaboutgrantingpermitsuntilalltheramificationscanbetheseareyettobefullytested.4fullyunderstood.AnewUNBiodiversityBeyondNationalJurisdiction(BBNJ)Foremergingcoastalandsmallislandnations,blueeconomyagreementagreedinMarch2023willestablishaninternationalandbluecarbonecosystemsofferaplatformforgrowththatlegalframeworktoprotecttheenvironmentofmorethanthecanattractinternationalfundingandinvestment,allowingthemtwo-thirdsoftheoceansthatareoutsidenationalmanagement.5toundertakecultivationwhileachievingjusttransitionsandincreasingeconomicprosperity.1‘Theocean—theworld’sgreatestallyagainstclimatechange’,UnitedNations.h­t­t­p­s­:­/­/w­w­w­.­u­n.­o­r­g/­e­n­/c­li­m­a­techange/science/climate-issues/ocean2‘The(blue)wealthofnations’,KPMGInternational,June2023.https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2023/06/the-blue-wealth-of-nations-Web.pdf3‘Seaforestation:benefitstotheclimate,theecosystemsandthepeopleofBritishColumbia’,OceanWise,June2022.h­t­t­p­s­:­/­/­oc­e­a­n.o­r­g/a­p­p/uploads/2022/07/OceanWise-SeaforestationV1-1.pdf4‘Blueecosystemsareournaturalallies’.KPMGInternational,May2022.https://kpmg.com/xx/en/home/insights/2022/05/blue-carbon-ecosystems.html5JaneCollins,‘ThenewUNOceanAgreementonMarineBiologicalDiversityofAreasBeyondNationalJurisdiction’,KPMGInternational,May2023.https://kpmg.com/xx/en/home/insights/2023/05/the-blue-economy.html6‘Youcan’tgogreenwithoutblue’,KPMGInternational,June2023.https://kpmg.com/xx/en/home/insights/2021/05/you-cant-go-green-without-blue.html7MikeHayes,‘Turningthetideonclimatechange.Utilizingouroceansforenergyandcarboncapture’,KPMGInternational,May2023.https://kpmg.com/xx/en/home/insights/2023/05/the-blue-economy.html8‘Climatechangeandfishing’,MarineStewardshipCouncil.h­t­tp­s­:­/­/­w­w­w­.m­s­c­.o­r­g­/wha­t-we­-are-doing/oceans-at-ri­sk/climate-change-and-fishing27NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsCountryprofiles28NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsAustraliaFollowingachangeofgovernmentinMay2022’sfederalThegovernmentwantsrenewableelectricityproductionelections,thenewLaborpartyadministrationhasenshrinedtorisefrom27percentatpresentto82percentin2030.42022’schangeofgovernmenthasledtoaanetzerotargetdateof2050inlaw.1IthasalsoincreasedItaimstodothisinaplannedwaythroughunderwritinglegallyenshrinednetzerotargetfor2050andthecountry’sinterimemissionsreductiontargetfor2030developmentoftransmissionandrenewableenergyzones,supportingactivity,includingtheexpansionfrom26-28percentto43percentbelow2005levels2andwhichhostbothgridinfrastructureandproductionincludingofemissionstradinginindustryandatargetintroducedarangeofsupportinglaws,targets,regulationssolar,onshorewindandhydroelectricgenerationaswelltoincreaserenewableelectricity’sshareandinitiatives.“It’saquantumleapinAustralia’slegislativeasbatterystoragetoprovidestability.Federalandstatefrom27to82percentby2030.architecture,”saysBarrySterland,Partner,EnergyTransitionLeader,ManagementConsulting,KPMGAustralia.ThishasGHGemissionssplitbysector(2022)29NetZeroReadinessReport2023involvedarapidaccelerationfromthecountry’spreviouslessmatureposition,withsupplychainsandregulators15%Energyexcludingelectricitystrugglingtokeepup.“Thebiggestchallengeisthespeedofchangerequired.Youwouldnotstartfromhere,”headds.29%ElectricityThenewgovernmenthasbuiltonexistinglegislationby18%Transportreformingtheso-calledSafeguardMechanismtointroduce4%Buildingsbindingemissionsbaselines,emissionstradingandthereforecarbonpricingtoallnon-electricityfacilitiesthatgenerate13%Industrymorethan100ktCO2eayear,affectingindustry,oilandgasproductionandmining.3Thestrengthenedversionof19%AgriculturetheschemestartedinJuly2023andaimstogradually3%Wastereduceemissionsbaselinesinlinewiththegovernment’semissionreductiontargets,inwhatSterlandsaysisaSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,cleveradaptationofanexistingscheme.Thegovernmenth­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023provideslessrestrictivebaselinesfortrade-exposedheavymanufacturingandfundingforindustrialdecarbonizationthroughitsPoweringtheRegionsfund.Itisconsideringacarbonborderadjustmentmechanismthatwouldprovideanalternativemeansofprotectingtrade-exposeddomesticcompaniesbylevyingequivalentchargesorprovidingrebatesontradedgoods.EDGAR(EmissionsDatabaseforGlobalAtmosphericResearch)CommunityGHGDatabase,acollaborationbetweentheEuropeanCommission,JointResearchCentre(JRC),theInternationalEnergyAgency(IEA),andcomprisingIEA-EDGARCO2,EDGARCH4,EDGARN2O,EDGARF-GASESversion8.0,(2023)EuropeanCommission,JRC(Datasets).IEA-EDGARCO2,acomponentoftheEDGAR(EmissionsDatabaseforGlobalAtmosphericResearch)CommunityGHGdatabaseversion8.0(2023)includingorbasedondatafromIEA(2022)GreenhouseGasEmissionsfromEnergy,h­t­t­p­s­:­/­/­w­w­w­.­iea.org/data-and-statistics,asmodifiedbytheJointResearchCentre.©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsgovernmentsareunderwritingrenewableproductionandelectrification.6ThestategovernmentofVictoriahasSofar,decarbonizationworkinagriculturehasfocusedonstorage,includingwithcontractsfordifferencewhichannouncednewhousedevelopmentswillbeallelectricresearchincludingmethaneemissionsfromlivestock.Someprovidealong-termpricefloorfortheelectricityproduced.from2024.landownersareusingreforestationandsimilarprojectstoIndigenousAboriginalcommunitiesareincreasinglyinvolvedclaimcarboncreditsthattheycanselltolargeemittersorinrenewableenergydevelopmentsontheirlands,suchasSector-specificplansuseagainsttheirownemissions.plansfora3billionAustraliandollar(AUD)(US$1.92billion)solar,hydroelectricandgreenhydrogenprojectintheInJuly,ClimateChangeandEnergyMinisterChrisBowen“AswellasregulatorydevelopmentstheAustralianKimberleyregionofWesternAustralia.5GovernmentsareaskedtheClimateChangeAuthoritytoprovidestatutorygovernmentismovingfasttoimplementmandatoryclimateworkingwithindigenouscommunitiestodevelopaFirstadviceonemissionstargetsfor2035andsixsector-specificreportingonaphasedbasisforalllargeorganizations,”NationsCleanEnergyStrategy.plans.7OntransportthefederalgovernmentisworkingonsaysAdrianKing,PartnerinCharge,ClimateChange&emissionsstandardsfornewroadvehicles,providestaxSustainabilityServices,KPMGAustralia.ThesenewclimateThereisnonuclearelectricitygenerationinAustraliaatincentivesforadoptingelectricvehiclesandalongwithstatereportingruleswillbebasedontheglobalInternationalpresentandthislooksunlikelytochange.However,roof-governmentshelpsfundcharginginfrastructure.SustainabilityStandardsBoard.TheAustralianAccountingmountedsolargenerationisincreasinglycommonincitiesStandardsBoardisworkingonstandardswhichKPMGandthecountryisplanningdevelopmentofoffshorewind,Agricultureandlanduse,Australia’ssecondbiggest-Australiaexpectstobepublishedintimetomeetalthoughthisisunlikelytocontributesignificantlyuntilemittingsectorafterelectricity,islargelyregulatedatagovernmentrequirementsformandatoryclimatereporting.8the2030s.ThegovernmentisalsodevelopingaNationalstatelevelandinJulythefederalandstategovernmentsEnergyPerformanceStrategyonenergyefficiencyandannouncedthattheywilljointlydevelopanationalstrategy.1‘Australialegislatesemissionsreductiontargets’,PrimeMinisterofAustralia,8September2022.h­t­t­p­s://w­w­w.pm.gov.au/media/australia-legislates-emissions-reduction-targets2TiffanieTurnbull,'Climatechange:Australiasignsnewcarbonemissionstarget’,BBCNews,16June2022.h­t­t­p­s://w­w­w.bbc.com/news/world-australia-618220463‘Safeguardmechanism’,AustralianDepartmentofClimateChange,Energy,theEnvironmentandWater.h­t­t­p­s://w­w­w.dcceew.gov.au/climate-change/emissions-reporting/national-greenhouse-energy-reporting-scheme/safeguard-mechanism4‘Australiahasraiseditsclimatetargetsandnowneedstoaccelerateitscleanenergytransition,saysnewIEAreview’,InternationalEnergyAgency,19April2023.h­t­t­p­s://w­w­w.iea.org/news/australia-has-raised-its-climate-targets-and-now-needs-to-accelerate-its-clean-energy-transition-says-new-iea-review5DanielMercer,‘Traditionalownerstakemajoritystakein$3billionWesternAustraliangreenenergyproject’,ABCNews,17July2023.h­t­t­p­s://w­w­w.abc.net.au/news/2023-07-18/traditional-owners-stake-in-australias-green-energy-transition/1026111946‘NationalEnergyPerformanceStrategy’,AustralianDepartmentofClimateChange,Energy,theEnvironmentandWater.h­t­t­p­s://w­w­w.energy.gov.au/government-priorities/australias-energy-strategies-and-frameworks/national-energy-performance-strategy7SpeechbyChrisBowen,AustralianMinisterforClimateChangeandEnergy,18July2023.h­t­t­p­s://minister.dcceew.gov.au/bowen/speeches/address-clean-energy-council8‘Getreadyforglobalsustainabilitystandards’,KPMGinAustralia,25July2023.https://kpmg.com/au/en/home/insights/2022/04/issb-sustainability-reporting-disclosures-guide.html30NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)28%-1%28%-18%16%4%-11%-12%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)-36%-18%-33%-17%-25%-28%-33%-43%-150%-100%-50%0%50%100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData31NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsBrazilhasgonealongwaytowardsdecarbonizingitspowerinGlasgow.4PlanoABC+includestherecoveryof15millionproductionwithalmost45percentofitsenergycomingfromhectaresofcurrentlydegradedpastures,expansionoftheuseofrenewablesources.Aroundfour-fifthsofelectricitycomesfrombiologicalnitrogenfixationtoreplacenitrogen-basedfertilizersandhydropowerplantsandsolargenerationisgrowingquickly.1thereforestationofmillionsofhectaresofland.SalgadosaysthatMostofthecountry’scarsareflex-fuelmodelsthatcanrunaswellasreducingnetemissionsandimprovingthecountry’sonethanolbiofuelproducedfromsugarcaneorcornaswellasenvironment,reforestationprovidescommercialopportunitiesgasoline,somethingthegovernmentseesasasignificantpointthroughthepotentialsaleofcarbonoffsets.infavorofitsautomotiveindustry.ChinesemanufacturerGreatWallMotorstartedlocalproductionofhybridcarsinAprilthatFreighttrucksinBraziltendtousecarbon-intensivedieselratherrunon100percentethanolandelectricity.2thanethanolbiofuel.InJunethegovernmentcompletedthe35-yearconstructionofthe2,257kilometerNorth-SouthRailroadFelipeSalgado,ESGAdvisoryDecarbonizationDirectorforKPMGinBrazil,saysthecountry’sprogressoncleanenergycreatesGHGemissionssplitbysector(2022)opportunitiesforitscompanies.Forexample,itcouldmeanBrazilianexporterspayinglessthanthoseinothercountries5%EnergyexcludingelectricityundertheEU’sCarbonBorderAdjustmentMechanism(CBAM),4%Electricitywhichstarteditsinitialtransitionalphaseon1October.CBAMwilltaximportstotheblocinlinewithchargesfacedbyEuropean16%TransportcompaniesunderitsEmissionsTradingSystem(ETS),helpingBrazilcountriesthatuselow-carbonenergy.34%Buildings11%IndustryBrazilhopestobenefitfromhighlevelsofTheBraziliangovernmentisalsodiscussingtheintroductionofcleanenergyusewhenexportingtotheEUaregulatedcarbonmarketalignedtotheEUETSandhopes46%AgricultureunderthenewCarbonBorderAdjustmenttounveilplansbeforeNovember’sCOP28UNclimatechangeMechanism.Anewfreightrailroad,arobustconference.“Thisisagamechanger,”saysSalgado.“These13%Wasteagricultureplanandenhanceddeforestationtwodrivers,theinternalregulatedmarketandCBAM,canpushmonitoringprovidefurtheropportunitiestothedecarbonizationofbigcompaniesastheystartmeasuringandSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,decarbonize.implementingcarbonreductioninitiatives.”h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_202332NetZeroReadinessReport2023AgriculturalplansandnewrailwaysAgricultureisresponsibleforsignificantemissionsandanewversionofBrazil’sABCplanfordecarbonizingthesector,succeedingonewhichranfrom2010to2020,waspublishedbythegovernmentinOctober2021fortheCOP26conference©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactswhichlinksareasthatproducecommoditiesincludingsoy,Changeinabsoluteemissions(2005–2022)cornandcottontotheseaportsofSantosnearSãoPaulointhesoutheastofBrazilandItaquiinMaranhãointhenorth.523%Evenbeforeitscompletion,therailwaywastransportingaroundhalfofthecountry’sexportedagriculturalbulksolids.-1%Brazilisalsolookingathowitcanshiftsomefreightfromroadstoseatransportation.46%TherearechallengesforBrazil’sgovernmenttoaddress.53%Salgadosayssomeexistingprogramsandpoliciesincludingthoseondeforestationareunderminedbypoorinspectionand20%enforcementandconflictscanarisebetweendecarbonizationworkandsocialpolicies.Thegovernmentdoesnotcurrently9%taxownershipofoldervehicles,butthereareinitialdiscussionsonchangingthistoencouragedriverstoswitchtonewerand18%typicallymorefuel-efficientones.However,Salgadosaysthatthiscouldrequirefinancialsupporttohelpthosewitholdvehiclesto30%buynewerones,ratherthanpricethemoffroads.-150%-100%-50%0%50%100%150%1‘Brazil’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/countries/brazil2GabrielAraujo,‘Hybrid-flexcarsagreatassetforBrazil’sdecarbonizationefforts,saysChangeinemissionsintensity(2005-2022)VP’,Reuters,28April2023.h­t­t­p­s://w­w­w.reuters.com/business/sustainable-business/-12%hybrid-flex-cars-great-asset-brazils-decarbonization-efforts-says-vp-2023-04-28/-46%3‘CarbonBorderAdjustmentMechanism’,EuropeanCommission.h­t­t­p­s://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism_en-13%4‘Brazilexpandscarbonemissionreductiontargets’,AgênciaBrasil,19October2021.10%h­t­t­p­s://agenciabrasil.ebc.com.br/en/politica/noticia/2021-10/brazil-expands-carbon-emission-reduction-targets-14%5PedroRafaelVilela,‘RailroadlinkingfourBrazilianregionscompletedafter35-6%years’,AgênciaBrasil,16June2023.h­t­t­ps://agenciabrasil.ebc.com.br/en/politica/noticia/2023-06/railroad-linking-four-brazilian-regions-unveiled-after-35-years-26%-7%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData33NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsCanadaLikemanycountries,Canadahasbeenaffectedbyinflationgreatercertaintyonthefuturepriceofcarbontoreduceandconcernsoverthecostofliving.Butitisalsoseeingtheupfrontinvestmentrisk.3TheCleanFuelRegulations,whichThefederalgovernmentisencouragingimpactofclimatechangerelatedeventssuchasincreasingbecamefederallawin2022,providefuelproducerswithinvestmentinrenewableenergyandrelatednumbersofextremeweathersuchasflooding,droughtsandincentivestoreducecarbonemissionsthroughoutthetechnologythrougharangeoffundingitsworst-everwildfireseason.1Theseeventshaveincreasedlifecycleofextraction,processing,distributionanduse.4mechanismsandworkingwithprovincestopublicawarenessregardingthephysicalimpactsofclimateThegovernmentalsoremainscommittedtointroducingenabledevelopmentofrelatedprojectsandchangeandtheurgentneedforinterventions.apreviouslyannouncedcarbontax.“Thebottomlineisindustriesacrossthecountry.thatthegovernmentisusingincentivesandfundingasCanadahasseenemissionsintensitiesdroppingacrossthetheleverstoencourageandaccelerateinvestmentinlow34NetZeroReadinessReport2023economyandparticularlyinelectricity,wasteandtransport,withothersectorsfallingless.ThispresentsbothchallengesGHGemissionssplitbysector(2022)andopportunitiessaysAndrewMcHardy,Partner,NationalDecarbonizationHubLeader,KPMGinCanada.Thecountry25%Energyexcludingelectricityhasthetechnicalexpertiseandskills,alongwithabundantnaturalresourcesincludingcriticalminerals,toacceleratethe10%Electricitymovetoalow-carbonfuture.ThisrepresentsasignificantopportunityforCanadianstodecarbonizetheircommunities24%Transportandindustrieswhilesupportingeconomicgrowthbyexportingthesesolutionsglobally.13%BuildingsThe2023federalbudgetincludedseveralincentives,16%Industryfinancingandfundingopportunitiesthatfocusedonbuilding8%AgricultureacleaneconomyinCanada.Thisincluded20billion3%WasteCanadiandollars(CAD)(US$14.7billion)tosupportinvestmentsincleanelectricity,hydrogen,technologySource:CalculatedbyKPMGInternationalusingdatafromEDGAR,adoption,technologymanufacturingandcarboncapture,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023utilizationandstorage(CCUS).ThebudgetalsoallocatedCAD15billionforaCanadianGrowthFundandCAD20billiontotheCanadaInfrastructureBanktosupportcleanelectricityandgrowthinfrastructureprojectsalongwithadditionalfundingtostrengthentheelectricitygrid.2Budget2023includedconsultationontheintroductionofcarboncontractsfordifference,whichwouldsupportdecarbonizationprojectssuchasCCUSbyproviding©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactscarbonsolutions,”saysMcHardy,whichshouldsupportbanondevelopingonshorewindfarms5whilethecountryintheconstructionofvehiclebatteryplants.Majorpublicfavorabledecisionsonprojectsthatcanlastformanyyearshasseassuitableformuchmoreoffshorewindgeneration.transportsystemsarealsodecarbonizing,includingtheOn-ordecades.InJuly,theprovinceofOntariosaiditwasplanninganewCorridorprojecttoelectrifyandexpandGreaterTorontoandlarge-scalenuclearplantattheBrucePowersiteandthreeHamilton’srailnetwork.7However,McHardyaddsthatthePotentialformoreenergymoresmallmodularreactorsatDarlingtoninadditiontoonecountry’ssize,dispersedpopulationandclimatecontinuealreadyannounced.6tocreatechallengesforthetransportationsectortoreduceAroundthree-quartersofCanada’selectricitycomesdependencyonfossilfuels,withthesamebeingtrueoffromlowcarbonsources,butthecountryhassignificantAlthoughelectricvehiclesalesmadeuplessthan10percentelectricity,heatingandindustryinremoteareas.potentialtoincreasethissupplythroughthedevelopmentofallcarsalesin2022,thefederalandprovincialgovernmentsofadditionalrenewableenergy.Forexample,inApril2022aresupportinggreateradoptionthroughpurchaseincentivestheprovinceofNewfoundlandandLabradorendeda15-yearandbyaddressingsupplychainconstraintsthroughinvesting1IsmailShakil,‘Canadaontrackforitsworst-everwildfireseason’,Reuters,6June2023.h­t­t­p­s://w­w­w.reuters.com/world/americas/canada-track-its-worst-ever-wildfire-season-2023-06-05/2'MinisterGuilbeaulthighlightsthebigfivenewCleanInvestmentTaxCreditsinBudget2023tosupportsustainablemade-in-Canadacleaneconomy',GovernmentofCanada,5April2023.h­t­t­p­s://w­w­w.canada.ca/en/environment-climate-change/news/2023/04/minister-guilbeault-highlights-the-big-five-new-clean-investment-tax-credits-in-budget-2023-to-support-sustainable-made-in-canada-clean-economy.html3SteveScherer,‘Exclusive:Canadabudgetseescontractsfordifferenceforlargeclean-techprojects—source’,Reuters,27March2023.h­t­t­p­s://w­w­w.reuters.com/world/americas/canada-budget-set-up-contracts-differences-large-projects-source-2023-03-27/4‘WhataretheCleanFuelRegulations?’,GovernmentofCanada.modified7July2022.h­t­t­p­s://w­w­w.canada.ca/en/environment-climate-change/services/managing-pollution/energy-production/fuel-regulations/clean-fuel-regulations/about.html5‘N.L.governmentlifts15-yearbanononshorewindfarms’,CBC,5April2022.h­t­t­p­s://w­w­w.cbc.ca/news/canada/newfoundland-labrador/nl-wind-moratorium-lifts-1.64092966PaulDay,‘Canada’snucleardrivepicksupspeed’,Reuters,25June2023.h­t­t­p­s://w­w­w.reuters.com/business/energy/canadas-nuclear-drive-picks-up-speed-2023-07-25/7ONxpress.h­t­t­p­s://onxpress.com/35NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)2%22%-37%-150%-100%-50%5%50%100%150%10%0%12%0%0%Changeinemissionsintensity(2005–2022)-23%-12%-41%-21%-17%-12%-16%-24%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData36NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChinaChina,theworld’slargestemitterofgreenhousegasesbyasprovidingenergysecurity,havingjoinedIndiaandothervolumeduetoitslargepopulationandmanufacturingsector,countriestosuccessfullynegotiatethatcoalbe“phasedRapidgrowthinrenewableenergygenerationisreliesonacombinationoffactorstotacklethis.Thefirstisdown”ratherthanphasedoutattheCOP26climatechangesupportedbyplanning,highlevelsofinvestmenttop-downplanning,withthenationalgovernmentprovidingconferenceinNovember2021.7andgridupgrades.Whileenergysecurityandtop-leveldesignandguidancewithdetailedimplementation“Inthelongtermtheplanistophaseoutcoal,”sayseconomicgrowthsupportshort-termincreasesschemesinkeysectorsandsupportingplans,whileprovincialWeiLin,HeadofEnvironmental,SocialandGovernance,incoalconsumption,achievingcarbonneutralitygovernments,corporates,financialinstitutionsandothersKPMGChina.“ThereisalwaysthisbalancebetweenwillrequireaprofoundtransformationofChina’simplementprojects.Thecountryalsohashighlevelsofthelong-termandshort-termcrunchesinpowerorenergysystem.investmentonenergytransition,estimatedatUS$550billioneconomicdevelopment.”Agovernmentplanpublishedin2022byresearcherBloombergNEF,1andhasnearlytripledinOctober2021projectsthatcoalconsumptionwilllowcarbonenergygenerationbetween2010and2020toreach2,591TWh.2“TheyneedtoplayalltogethertomakeGHGemissionssplitbysector(2022)itwork,”saysDaisyShen,Partner,HeadofClimateandSustainability,KPMGChina.11%EnergyexcludingelectricityThecountryfaceschallengesinmanagingthisgrowth,38%Electricityincludingupgradedgridinfrastructuretolinkrenewablegenerationinthewestofthecountrytopopulationand6%Transportindustrialcentersintheeast.TheStateGridbudgetedmore5%Buildingsthan500billionChineseyuanrenminbi(RMB)(US$68.5billion)in2022forultrahighvoltagepowerlines,othergridupgrades32%Industryanddigitizationwork.3Chinaisalsoexpandinguseofenergystoragetechnologiesthathelptosmooththeintermittent6%Agriculturenatureofrenewableproduction,withelectrochemicalstorage3%Wastecapacitymorethandoublingin2022,4andrapidincreasesinhydrogenfuelproduction,althoughmainlyfromcoalandgasSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,atpresent.5h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023CoalremainsChina’smostimportantfuelgenerating4,928TWhofelectricityin2020andelectricityproductionaccountingforjustunderhalfofChineseemissions.In2022,localauthoritiespermitted106GWofnewcoalgeneration,fourtimestheamountin2021andsixtimesasmuchastherestoftheworldcombinedaccordingtoresearchbyUSdatapublisherGlobalEnergyMonitor.6Thegovernmentseescoal37NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactscontinuetoriseuntil2025thenstarttofallby2030,alongitsfirstsystematicattempttousemarket-basedinstrumentsproductionareresearchinghydrogenandcarboncaptureandwithoverallcarbondioxideemissions.Theproportionoftoregulatecarbonemissions.Buildingontheexperienceofstoragebutthishasyettoreachcommercialization.energyproducedwithoutfossilfuelsisprojectedtoriseregionalpilotsChinabroughtanationalcarbonETSonlineinto20percentby2025,25percentby2030andexceed2021,thelargestcarbonmarketintheworld,coveringonlyChinaistheworld’sbiggestadopterofelectricvehiclesby80percentby2060.8thepowergenerationsectorsofar.Thegovernmentplanstonumberandamongthelargestbyproportion,withelectricextendtheschemetoeightmajorindustriesandrestartthemodelsmakingup29percentofcarssoldin2022.9TheExpandingemissionstradingChineseCertifiedEmissionReductionschemebytheendcountry’sautomotivemanufacturershavedevelopedlow-costof2023,providingfinancialincentivesforcuttingemissions.electricvehiclessuchasBYD’sSeagull,unveiledattheShanghaiEmissionstradingsystems(ETS)representanimportantThecountrywillalsoneedtopreparefornewinternationalautoshowinApril,withhopesforsignificantexportpotential.10policyinstrumentforChinatoachieveitsclimatetargets.leviessuchastheEU’sCarbonBorderAdjustmentIn2013thecountrylaunchedregionalcarbonETSpilots,Mechanism.Somehigh-emittingindustriesincludingsteel1‘Chinacanachievenet-zeroenergyemissionsby2050whilestrengtheningitsenergysecurity‘,BloombergNEF,30May2023.h­t­t­p­s://about.bnef.com/blog/report-shows-way-for-china-to-meet-climate-goals-10-years-early/2‘China‘,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/countries/china3WeiLin,AngusChoiandEbeleAngelaOnyeabo,‘Smartergrids:poweringdecarbonisationthroughtechnologyinvestment‘,KPMGinChina,18May2023.https://kpmg.com/cn/en/home/insights/2023/05/smarter-grids.html4‘Newenergystoragetechnologiesempowerenergytransition(synopsis)‘,KPMGinChinaandChinaElectricityCouncil,May2023.https://assets.kpmg.com/content/dam/kpmg/cn/pdf/en/2023/03/new-energy-storage-technologies-empower-energy-transition.pdf5‘Thefast-growinghydrogenenergyindustry(synopsis)‘,KPMGinChina,26October2022.https://kpmg.com/cn/en/home/insights/2022/09/understand-the-hydrogen-energy-industry-in-one-article.html6YujieXue,‘Climatechange:Chinaapprovedmostcoalpowerplantssince2015lastyear,makingenvironmentalgoalsharder,researchshows‘,SouthChinaMorningPost,27February2023.h­t­t­p­s://w­w­w.scmp.com/business/china-business/article/3211656/climate-change-china-approved-most-coal-power-plants-2015-last-year-making-environmental-goals7ValerieVolcovici,KateAbnettandWilliamJames,‘U.N.climateagreementclinchedafterlatedramaovercoal‘,Reuters,14November2021.h­t­t­p­s://w­w­w.reuters.com/business/cop/un-climate-negotiators-go-into-overtime-save-15-celsius-goal-2021-11-13/8‘Actionplanforcarbondioxidepeakingbefore2030‘,ChinaDepartmentofResourceConservationandEnvironmentalProtection,27October2021.h­t­t­p­s://en.ndrc.gov.cn/policies/202110/t20211027_1301020.html9‘GlobalEVDataExplorer‘,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/global-ev-data-explorer10ZhangYanandCaseyHall,‘AsEVcoststumbleinChina,anexportwavebuilds‘,Reuters,19April2023.h­t­t­p­s://w­w­w.reuters.com/business/autos-transportation/ev-costs-tumble-china-an-export-wave-builds-2023-04-19/38NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)86%149%100%121%10%74%-5%-150%-100%-50%50%65%100%150%0%Changeinemissionsintensity(2005–2022)-50%13%-29%-40%-70%-55%-52%-55%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData39NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsDenmarkDenmarkhasalonghistoryofdevelopingalternativesourcesisland’100kilometersawayfromthecoastthatisduetobeofenergytofossilfuels.ThemajorityofDanishrenewableestablishedby2030.Thiswilleventuallyconnect10GWofThelong-termpoliticalfocusongreen,energyproductioncomesfrombiomassusedinpowerplants,offshorewindproductiontoDenmarkthroughahighvoltagerenewableenergyhasencouragedanincludingwoodchipsandpellets,strawfromtheagriculturallinkandwillalsohostenergystorage,aharbor,maintenanceecosystemofmanufacturersandfinancierssectoranddegradablehouseholdwaste.Thisbiomassisfacilitiesandaccommodationforworkerswiththeoptionofabletocollaborateonprojectsincludinganalmostexclusivelyusedinthedistrictheatnetworksthatareaddingproductionofgreenfuelsfromelectricity.2energyislandforoffshorewind.Thecurrentconnectedtonearlytwo-thirdsofDanishhomes.MichaelBirkebækJensen,Partner,HeadofProductsandgovernmentisworkingonemission-basedESG,KPMGinDenmark,seesthisnetworkofrenewabletaxesonagriculture.Thesecondlargestrenewableenergysourceiswindenergycompaniesasanationalstrength:“Thisissomethingpower.Thecountrybuiltitsfirstcommercialwindturbine40NetZeroReadinessReport2023in1979andhasexpandedtheirusetotheextentthatonGHGemissionssplitbysector(2022)15September2019productionfromwindexceededtotalnationaldemandforelectricity.1Giventhislargeshare5%Energyexcludingelectricityandthevariablenatureofwind,alsotrueforsolarpower,14%ElectricityDenmarkhasbeenfocusingonhowtointegrateintermittentpowerproduction,leadingtotheDanishelectricity27%Transporttransmissionoperatordevelopingworld-leadingexpertiseinthisarea.9%Buildings13%IndustryStronginterconnectionswithneighboringcountriesthatallowelectricitytobeexportedorimportedhelpthecountry24%AgriculturemanageintermittentrenewableproductionandDenmarkisplanningfurtherinterconnections.Aswindandsolar7%Wasteproductionwillcontinuetoincreaseforthenextdecade,thegovernmentalsoplanstodevelopgreenhydrogenSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,productionaswellasdirectelectricitystorageineitherh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023batteriesorothertechnologies,astrategybackedbycompaniesthathaveplantsplannedorinoperation.Denmarkhasdevelopedoneoftheworld’slargestwindturbinemanufacturingsectorsandisalsohomeofthecommercialfundmanagerCopenhagenInfrastructurePartners(CIP)whichspecializesindevelopingrenewableenergy,particularlyoffshorewind.CIPispartofaconsortiumworkingtobuildVindØ,anartificial‘energy©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsthathasbeenbuiltovertime.Itpositionsusnicelytopushfarmersandhavelittleeffectonglobalemissions,asInSeptember,thecompany’sfirstgreenmethanolpoweredaheadongreenpower,”hesays.DenmarkcouldalsodrawreducedDanishproductionwouldjustbesubstitutedbyship,asmallercontainervessel,wasnamedLauraMaerskonitsexperienceofextractingoilandgasbydevelopingincreasedproductioninothercountries.3JensensaystherebyEUCommissionpresidentUrsulavonderLeyeninacarboncaptureandstoragework,headds,giventheoverlapareopportunitiestohelpdecarbonizeagriculturethroughceremonyinCopenhagen.5intechnologiesandskills.useofdigitaltechnologiessuchasprecisionfarmingthatautomatesandoptimizestheuseofinputs.Onland,DanishfreightoperatorDSVhasstartedtoelectrifyAgriculturalleviesitsvehiclefleetinNorthAmerica.6InpartnershipwithDigitaltechniquescanalsoimprovetheefficiencyoflogisticslogisticsandferryoperatorDFDSandfoodgroupsArlaandAnewcoalitiongovernmentformedinDecember2022andKPMGinDenmarkhasworkedwiththemaritimeindustryDanishCrown,thecompanyisalsoplanningtoestablishaannouncedplanstointroducenewleviesonagriculture,thetooptimizeroutesofships,includingthroughuseofartificialcarbonneutralfoodtransportcorridortotheUKbyusingcountry’ssecond-biggestemittingsector,althoughithasintelligence.Decarbonizationwillalsorequirenewfuelsandelectrictrucks,refrigeratedtrailersandgreenerfuels.7yettopublishdetails.InFebruary2023thegovernment’sDanishshippingandlogisticsgroupMaersk,whichaimstoDenmarkisalsonearingthe2027completionofaprogramindependentadvisorrecommendedanemissions-basedachievenetzeroemissionsby2040,hasordered19vesselstoelectrifythemajorityofitsstaterailwaynetworkbytaxthatwouldencouragefarmerstoswitchfrombeefthatcanrunongreenmethanolproducedbyrenewableconverting1,362kilometersoftrack.8anddairytocropsandporkproduction,withalobbygroupelectricity,includingsixlargeocean-goingshipsfromHyundaiarguingthatthiswouldleadtobankruptciesamongDanishHeavyIndustries.41“Biomasseanalyse”,DanishEnergyAgency,May2020.h­t­t­p­s://ens.dk/sites/ens.dk/files/Bioenergi/biomasseanalyse_final_ren.pdf”B2‘EnergyIslandVindØ‘,CopenhagenInfrastructurePartners.h­t­t­p­s://w­w­w.cip.com/approach/our-projects/energy-island/3JohannesBirkebaek,‘TaxingfarmingvitalforDenmark‘sclimatetarget-govtadviser‘,Reuters,20February2023.h­t­t­p­s://w­w­w.reuters.com/world/europe/taxing-farming-vital-denmarks-climate-target-govt-adviser-2023-02-20/4‘Decarbonisingoceantransport‘,Maersk.h­t­t­p­s://w­w­w.maersk.com/sustainability/our-esg-priorities/climate-change/decarbonising-ocean-shipping5‘EUCommissionpresidentnameslandmarkmethanolvessel“LauraMærsk”’,Maersk,14September2023.h­t­t­p­s://w­w­w.maersk.com/news/articles/2023/09/14/eu-commission-president-names-landmark-methanol-vessel-as-laura-maersk6‘DSVPlacesOrderfor10ElectrifiedTrucksasPartofNorthAmericanEmissions-ReductionInitiative‘,DSV,25January2023.h­t­t­p­s://w­w­w.dsv.com/en-us/about-dsv/press/news/us/2023/01/north-american-emissions-reduction-trucking7‘Danishcompaniesteaminguptoprovideclimate-neutraltransportbetweenDenmarkandtheUK‘,DSV,20June2023.h­t­t­p­s://w­w­w.dsv.com/en/about-dsv/press/news/com/2023/06/danish-companies-to-provide-climate-neutral-transport8‘Electrificationprogramme‘,Banedanmark.h­t­t­p­s://uk.bane.dk/en/Projects/Electrification-Programme41NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-6%3%-32%-69%-49%-40%-32%-150%-100%-50%0%50%91%150%100%Changeinemissionsintensity(2005–2022)-46%-62%-26%-53%-44%16%52%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData42NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsFranceFortwodecades,largecompaniesinFrancehavecompiledHeaddsthatconsultantscantakearoleinsupportingsmallerdataonemissions,governedbylegalandregulatorycompaniesbyhelpingtodevelopnewideasandinitiatives.Frenchcompanieshavedecarbonizedrequirementsonitsaccuracy,andusedthistosetandmeetTosupportbetterdecision-makingacrossitsclients,KPMGdirectemissions,partlyduetogovernmentdecarbonizationtargets.TheresultshavebeensignificantinFrancehasintegratedaprocesswithinitsdecarbonizationregulationsanduseoflowcarbonnuclearreductionsincorporatescope1andscope2emissions,methodologythatworksoutthecarbonemissionswhichresultelectricity,andwantsupplierstodolikewise.supportedbyuseofFrance’slowcarbonelectricity,mostoffromthebusiness’smaingoalsandthecapitalexpenditureAgovernmentfocusontransporthasleditwhichisgeneratedbyitsfleetofnuclearpowerplants.In2022thatwouldberequiredtotacklethis,providingsomethingtobanflightsonafewroutesandincreasethreeofthe12corporateswiththehighest‘tripleA’ratingfrommeaningfultoseniorexecutives.controlsonurbancaruse.CDP,aninternationalnot-for-profitenvironmentaldisclosureorganization,werelistedinFrance.GHGemissionssplitbysector(2022)5%EnergyexcludingelectricityJérémieJoos,Partner,KPMGinFrance,saysthatformanycompaniesthegreatestchallengecomesfromscope312%Electricityemissionsgeneratedbysupplierswhichinsomecasesmakeup80percentoftheorganization’stotal.Ignoringthesecan28%Transportleadtodoublestandardsasacompanycouldreplaceitsownfleetwithelectricvehicleswhilecontractorscontinuedtouse17%Buildingsdieselandpetrol.Headdsthatcorporatescope3emissionsoftenriseinlinewithsales,asmanagersforcountriesand17%Industryregionsfocusonandareincentivizedtoincreasesalesratherthanmeetdecarbonizationtargets.16%Agriculture6%WasteMostFrenchcompaniesworkingonsupplierdecarbonizationstarteddoingsorecently,althoughafewhavealongrecordSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,ofthis.Joossaysthatcompaniesthatwanttoreducescope3h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023emissionsmayneedtosupportsuppliersindoingso,particularlyfordependentsmallerbusinesses.“Weneedtoaccelerateinitiativestofundthetransitionofthesesmallercompanies,”hesays.“Theydon’thavethefinancingtodecarbonizetheiractivities.”Oneoptionistoofferbetterpaymentterms.Amonghisclientsinagriculture,foodandbeverages,onehasofferedtofixpricesfor2yearsratherthantheusual6monthsandanothertopay12monthsinadvanceofdelivery,bothinordertohelpfunddecarbonizationwork.43NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsFromplanestotrainsChangeinabsoluteemissions(2005–2022)Acrosstheeconomyoverallemissionsintensityhashalved-21%since1990,butthehighest-emittingsectortransporthas-26%seenbelow-averagedeclinesinrecentyears.Totacklethis,inMaytheFrenchgovernmentbannedtheuseof-15%scheduledflightsforjourneysthatcanbemadeinunder-10%2.5hoursbytrain,althoughthisappliedtoonlyahandfulofroutesgivenexceptionsbasedontrainservicelevels.As-31%partofworkdescribedbyPresidentEmmanuelMacronas-33%“collectivesobriety”inenergyuse,thegovernmentisalsoofferingsubsidiestoencouragepeopletotradeincarsfor-12%electricbicycles.1-25%Salesofelectricvehiclesroseslightlyto21percentofall-150%-100%-50%0%50%100%150%carsalesin2022.2Parisisincreasinglyrestrictingaccesstodriverswithsomemore-pollutingvehiclesalreadybanned—Changeinemissionsintensity(2005-2022)althoughaplantotoughentheserulesinthesummerof2023waspostponeduntilJanuary2025—withtheeventual-34%intentionofmakingthecitycenterentirelycar-free.39%1LottieLimb,‘It’sofficial:Francebansshort-hauldomesticflightsinfavouroftrain-24%travel’,Euronews,23May2023.h­t­t­p­s://w­w­w.euronews.com/green/2022/12/02/-42%is-france-banning-private-jets-everything-we-know-from-a-week-of-green-transport--29%proposals-17%2‘GlobalEVdataexplorer’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and--37%statistics/data-tools/global-ev-data-explorer-150%-100%-50%0%50%100%150%3‘Parisdelaysbanondieselcars’,TheLocalFr,13July2023.h­t­t­p­s://w­w­w.thelocal.fr/20230713/paris-delays-ban-on-diesel-carsEconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData44NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsGermanyGermany’spoliticsprovidestrongsupportforitsshifttowardsTriplingelectricitydemandnetzero.Thecountry’sGreenpartyisoneofthreemakingupGermanyhascommitteditselftoitscoalitiongovernmentandpeopleacrosssocietyprovideGermany’seconomyisstronglyfocusedonmanufacturingdecarbonizeitseconomyswiftly,butwhilerelativelyhighlevelsofconsenttopursueenvironmentalcomparedwithmanyotherdevelopedcountries.Movingmostpoliticalpartiesandindustriesincludinggoals.Germanyalsohostswell-functioningcapitalmarketsenergy-intensivesectorsincludingautomotive,steelandautomotivearestrongsupportersofthisandawealthoftechnicalinnovators,givingcompanieschemicalproductionandprocessingfromfossilfuelscouldaimthereisdebateoverthepace.Theaccesstothefundingandexpertiseneededtodecarbonizemeanthecountryneedingthreetimesasmuchelectricitycountryneedstofindwaystoincreasecleantheiroperations.overthenextdecadesastoday.Thecountryhasincreasedelectricityandhousingefficiency.low-carbonproductionfromalowbasetogeneratingnearlyKeyindustriesincludingautomotivearechangingrapidly.halfofitselectricity,butmaintainingthismomentumcouldVehiclemakersacrosstheEUarerequiredtostopsellingcarsbechallenging.Thestrongestpotentialforwindgenerationthatemitcarbondioxideby2035,1butthecountry’slargestmanufacturerVolkswagenismovingfasterwithmorethanGHGemissionssplitbysector(2022)two-thirdsofitsEUR180billion(US$191billion)2023–27investmentbudgetallocatedtoelectrificationanddigitization.5%EnergyexcludingelectricityThecompanyexpectsthatafifthofthevehiclesitsellswillbeall-electricasearlyas2025,comparedwithjust7percent31%Electricityin2022.219%Transport“Thereisalargeefforttomovetoelectrificationofpassengervehicles,”saysGoranMazar,Partner,EMAandGerman16%BuildingsHeadofESGandAutomotive,KPMGinGermany.“Itisnotaquestionofwhetherwegoforelectrificationofpassenger19%Industryvehicles,itisabouthowfastwegetthere.”Manufacturersare7%Agricultureinvestingingreenhydrogengeneratedwithrenewableenergy2%Wasteasthereplacementfuelforcommercialvehiclesthatneedmorepowerthanbatteriescanprovide.Source:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023Theautomotivesectorisalsoadoptingcirculareconomytechniques,whichaimtominimizewastesuchasthroughrepairing,reusingandrecycling.MazarsaysthatanewEUdirectiveonelectricvehiclebatterieswhichmandatestheirrecyclingshouldreduceemissionsaswellasreducingthesector’sdependencyonimportsofrawmaterialsforbatteries,supportingtheshifttoelectricvehicles.345NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsinGermanyisinthenorthofthecountryandoffitsnortherntorunonhydrogen.4Morebroadly,thecurrentformofandetailedinformationonenvironmentalandsocialissues6andcoastline,butdemandismainlyinthemiddleandsouth,whichunfinalizedEUdirectivewouldrequire30percentofresidentialthisrequirementwilleventuallycoversome15,000Germanwillrequirenewgridinfrastructure.Germanyisunlikelytobuildingswiththelowestenergyefficiencyratingstoundergocompanies.7Thesearepartofaninternationalmovement,developnewnuclearpowergenerationasthisisnotsupportedupgradesby2030.5“ThatcannotbedonebytheownersofwiththeInternationalSustainabilityStandardsBoardrecentlybythemainpoliticalpartiesineithergovernmentoropposition.thesepropertiesalone,”saysDrStefanOtremba,Partner,publishingitsfirsttwostandardstoaimtoco-ordinatetheseRiskandComplianceServices,KPMGinGermany,addingthatglobally.8OtrembasaysthatthegreateravailabilityofsuchDecarbonizingresidentialpropertyfacessimilarpracticalgovernmentsubsidiesorincentivesarelikelytobeneeded.information,combinedwiththeincreasingenvironmentalfocusissues.TheGermangovernment’splanstorequireallnewofcapitalproviders,willbe“ahugedriver”forcompaniestodomesticheatingsystemstorunonatleast65percentForcompaniesinparticular,thepressuretofindwaystoacceleratetheirmovestowardsnetzeroemissions.renewableenergy,effectivelyblockingtheinstallationofnewdecarbonizewilllikelycontinuetoincrease.From2024,gas-firedboilers,ranintosignificantpublicoppositionleadingtheEU’sCorporateSustainabilityReportingDirectivewilltoexemptionssuchasforboilersthatcouldbeconvertedrequirethelargestlistedcompaniestopublishmuchmore1KateAbnett,‘EUcountriesapprove2035phaseoutofCO2-emittingcars’,Reuters,29March2023.h­t­t­p­s://w­w­w.reuters.com/business/autos-transportation/eu-countries-poised-approve-2035-phaseout-co2-emitting-cars-2023-03-28/2‘VolkswagenGroup’ssolidfinancialperformancelaysbasisforprofitablegrowthinkeymarkets’,VolkswagenGroup,14March2023.h­t­t­p­s://w­w­w.volkswagen-group.com/en/press-releases/volkswagen-groups-solid-financial-performance-lays-basis-for-profitable-growth-in-key-markets-169403GoranMazarandArnoudWalrecht,‘Sustainablebatteries’,KPMGInternational,March2023.https://kpmg.com/xx/en/home/insights/2023/03/sustainable-batteries.html4HolgerHansenandRihamAlkousaa,‘Germany’scoalitionagreeschangestogreenheatinglawafterdispute’,Reuters,13June2023.h­t­t­p­s://w­w­w.reuters.com/world/europe/germanys-coalition-agrees-changes-green-heating-law-after-dispute-2023-06-13/5‘Energyperformanceofbuildings(recast)’,EuropeanParliament,14March2023.h­t­t­p­s://w­w­w.europarl.europa.eu/doceo/document/TA-9-2023-0068_EN.pdf6‘GetreadyforanewlevelofESGreporting’,KPMGInternational,January2023.https://kpmg.com/xx/en/home/insights/2023/01/get-ready-for-the-next-wave-of-esg-reporting.html7GoranMazarandDrJan-HendrikGnändiger,‘CorporateSustainabilityReportingDirective(CSRD)’,KPMGinGermany.https://kpmg.com/de/en/home/insights/overview/esg/corporate-sustainability-reporting-directive.html8MarkVaessen,‘ISSBstandardsarenowlive’,KPMGInternational,26June2023.https://kpmg.com/xx/en/home/insights/2023/06/issb-ifrss1-ifrss2-talkbook.html46NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-20%-17%-30%-7%-22%-8%-13%-150%-100%-50%0%50%100%150%80%Changeinemissionsintensity(2005–2022)-36%13%-26%-26%-37%-24%-24%-150%-100%-50%0%50%100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData47NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsIndiaIndiahasbeenworkingtodecarbonizeitspowersectoratofelectricvehicles,althoughalsoincreaseduseofnaturalthesametimeasgreatlyexpandingitscapacity.Overallgas.3InFebruary2022thegovernmentannouncedapolicyIndiaisrapidlyincreasingrenewableenergyconsumptionhasmorethandoubledsince2000whichaimstomakethecountryahubforproductionandgeneration,whichfitswellwithaprimewiththecountryprovidingaccesstoelectricityfornearlyexportofgreenhydrogenproducedwithrenewableenergy.4ministerialtargetof“energyindependence”allhouseholdsaccordingtotheInternationalEnergyby2047.ThegovernmenthassignificantAgency(IEA).1Despitethis,theproportionofelectricityProgramsfortransportandindustryprogramstodecarbonizetransportandproducedfromlowcarbonsourceshasrisenslightlytoindustry,butagricultureislikelytopresentnearlyone-quarter.Unlikemostothersectorswhichhaveseensharpdeclineschallenges.since2005,India’semissionsintensityfromtransporthasApurbaMitra,Partner,ESG,KPMGinIndia,saystheshiftfallenonlyslightlysincethatdate.Governmentsupportfor48NetZeroReadinessReport2023wasinitiallydrivenbygovernmentincentivestodevelopwindvehicleelectrificationhaschanged,withthethirdversionofthepowerwhichattractedinvestmentsfromindividualsaswellascorporatesandencourageddomesticmanufacturing.TheGHGemissionssplitbysector(2022)solarboomsince2009hasseenanewfocusoncostwiththegovernmentusingreverseauctionsthatfavorverylarge5%Energyexcludingelectricitysolarandwindprojectsthatuseimportedequipment.Overall,renewableelectricitygenerationcapacityincreasedfrom32%Electricity27GWin2000to154GWin2021accordingtoIEAdataandtheagencyexpectsittodoubletoatleast300GWby2027.28%Transport7%BuildingsMitrasaysthatfallingglobalpricesaswellasgovernmentactionhavesupportedincreaseduseofrenewables,which22%Industrynowhavecomparablecoststocoalforelectricitygeneration.Givenintermittentsupplyofwindandsolar,coalwillstillbe20%Agricultureneededforthenearfuture:“Wearestilldependentoncoalforthebaseload,aswedon’thaveaccesstomuchnatural6%Wastegas.”Thereareeffortstobuildmorestoragecapacity,butatpresentIndiaisrelativelyweakondistributionandSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,technologyforschedulingconsumption.h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023Indiahaseconomicaswellasenvironmentalmotivationstochangeitsenergymix.In2021,PrimeMinisterNarendraModisetatargetof“energyindependence”by2047,acenturyafterthecountry’snationalindependence.Hesaidthiswouldincludemuchmorehydrogenproductionanduse©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsFasterAdoptionandManufacturingofElectricvehicles(Fame)underwayonsubsumingthisandasimilarschemeforthecomparedwith2005levelsratherthanafigureforoverallsubsidyprogramcurrentlyunderconsideration,5followingaenergysectorintoacross-sectoraltradingsystem.volumesgiventhecountry’seconomicallydevelopingshiftfromvehiclestobatteriesbetweenitsfirstandsecondstatus.Whilethismeanstheremaybelessmoneyforversions.Sofar,driversoftwoandthree-wheeledvehiclesAgricultureinIndia,asinothercountries,mayfinditdecarbonizationthaninsomeothercountries,Mitrasayshavebeenmorelikelytoshifttoelectricmodelsthanthoseofchallengingtomakesignificantfurthercutsdespitesomethereareopportunitiestoo:Indiaisprobablyyettobuildfour-wheeledcars.Amonglargervehicles,electricbusesaredeclineinitsemissionsintensity.Fertilizerissubsidizedbyhalfoftheinfrastructureitwillneedby2050,meaningthisgrowinginpopularity,supportedbymanybeingoperatedbygovernmentwhichcanencourageoveruseanditwouldbecanbeconstructedinanenergy-efficientfashionwhilepublic-sectororganizations,butsuchashiftisnotyetseenfordifficulttoreducemethaneemissionsfromdairylivestock.othercountrieshavetorelyonretrofitting.ThePanchamritcommercialtrucks.“Thisisasectorthatwillprobablytakelongerthanotherstogoalsfor2030alsoincludeincreasingnon-fossilfuelenergydecarbonize,”saysMitra.capacityto500GW,meetinghalfofenergyrequirementsIndustrialenergyconsumersinsomesectorsareencouragedfromrenewablesourcesandreducingprojectedcarbontoreduceusethroughPerform,AchieveandTrade,aregulatoryIndiaplanstoreachnetzeroby2070aspartofPrimeemissionsby1GtCO2e.7instrumentmanagedbytheMinistryofPower’sBureauofMinisterModi’sPanchamritclimategoals.ThesealsoEnergyEfficiencyallowingsavingstobetraded.6Workisincludereducingemissionsintensityby45percentby20301‘EnergyinIndiatoday’,IndiaEnergyOutlook2021,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/reports/india-energy-outlook-2021/energy-in-india-today2RenewablesDataExplorerusingdatafrom‘Renewables2022’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/renewables-data-explorer3‘PMModisets2047targetforbecomingenergyindependent’,TimesofIndia,15August2021.h­t­t­p­://timesofindia.indiatimes.com/articleshow/85342771.cms4‘India’sgreenhydrogenpolicy’,InvestIndia,9March2022.h­t­t­p­s://w­w­w.investindia.gov.in/team-india-blogs/indias-green-hydrogen-policy5‘Fame3.0:GovtconsidersfreshsubsidyplanforEVs’,TimesofIndia,13July2023.h­t­t­p­s://timesofindia.indiatimes.com/business/india-business/fame-3-0-govt-considers-fresh-subsidy-plan-for-evs/articleshow/101711387.cms6‘PerformAchieveandTrade(PAT)’,IndiaBureauofEnergyEfficiency.h­t­t­p­s://beeindia.gov.in/en/perform-achieve-and-trade-pat-07‘CabinetapprovesIndia’supdatednationallydeterminedcontributiontobecommunicatedtotheUnitedNationsFrameworkConventiononClimateChange’,IndiaMinistryofEnvironment,ForestandClimateChange,3August2022.h­t­t­p­s://pib.gov.in/PressReleasePage.aspx?PRID=184781349NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)79%34%52%124%157%153%17%35%150%-150%-100%-50%0%50%100%Changeinemissionsintensity(2005–2022)-34%-20%-12%-5%-44%-6%-32%-50%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData50NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsIrelandInJuly2021theRepublicofIrelandcommittedtocuttingThedevelopmentofoffshorewindwillcontributetogreenhousegasemissionsby51percentby2030comparedthegovernment’stargetofincreasingtheproportionofAmbitioustargetstohalveemissionsby2030with2018levels,onthewaytoreachingnetzeroemissionselectricityfromrenewablesfromjustbelowhalftouptowillmeanextendingalreadyextensiveusenolaterthan2050.1Whilethereispoliticalconsensuson80percent.8RussellSmyth,HeadofSustainableFutures,ofwindpowerthroughoffshoreprojects,theselegallybindingtargetstherearedoubtsabouthowKPMGinIreland,saysgrowthhasslowedrecently.“Thealthoughgridcapacityandplanningcouldquicklytheycanbedelivered.AJune2023assessmentbygridisbeginningtogetsaturatedandtheeasyearlywinscausedelays.Transportandthecountry’sdairyIreland’sEnvironmentalProtectionAgencyprojectedthathavebeenusedup,”hesays.“Planningandpolicyareandbeefherdsrepresentfurtherchallenges.thecountrywouldreduceemissionsbyonly29percentprovingsluggish.Thingsarestillpositivebutit’sgettingovertheperiodbasedoncurrenttrajectories.2“Wehavehardertomovethatproportion.”reallyambitioustargetsfor2030,”saysPhilipConnolly,AssociateDirector,SustainableFutures,KPMGinIreland.GHGemissionssplitbysector(2022)“Whetherornotweachievethemisanotherquestion,buthavingthoseinterimtargetsandbeingambitiousisakey2%EnergyexcludingelectricitystrengthforIrelandaseveryoneknowswherewehaveto14%Electricitygetto.”19%TransportIrelandalreadyhasthehighestpercentageofitselectricitygeneratedfromonshorewindatmorethan40percent.3It17%Buildingsisnowworkingtodevelopoffshorewind,whichaswellasmeetingdomesticdemandcouldallowthecountrytobecome12%IndustryanexporterofgreenhydrogenaccordingtoaNationalHydrogenStrategypublishedinJuly.4Thegovernmentwants35%Agriculturetosee5GWofoffshorewindcapacityby2030thenincreasethistoatleast30GWthroughtheuseoffloatingplatforms1%Wastethatcanoperateindeeperseas.5InJunethesystemoperatorEirGridconcludedORESS1,itsfirstauctionforoffshorewindSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,support,whichapprovedfourprojectswithtotalgenerationh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023capacityofjustover3GW,threeofftheeastcoastnearDublinandoneoffthewestcoastcountyofGalway.6IrelandhasalsoattractedinternationalinvestmentincludingajointventurebetweenDenmark-basedrenewablesdeveloperØrstedandIrishutilityESBtodevelopupto5GWofoffshorewindprojects.751NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsTransportandagriculturechallengesgiventhat2022sawdemandforpetrolanddieselincreasingNoteonemissionsintensityrelativetoGDP:Ireland’sdespitehighprices.grossdomesticproductroseby159percentbetween2014InJulytheDepartmentofTransportcutmaximumgrantsforand2022toEUR506billion,withasignificantproportionofprivatelypurchasedelectricvehiclesfromEUR5,000(US$5,310)SmythaddsthatthereisalackofclarityoveremissionsthisgrowthcausedbymultinationalcompaniesbookingbillionstoEUR3,500althoughithasmaintainedthelevelsofgrantsreductionsinagriculture,Ireland’slargestsourceofofeurosofinternationalrevenuesinthecountry.Thismeansforbusinesses.IthasalsopublishedastrategytoimprovegreenhousegasesanddominatedbydairyandbeefthatmeasuresofemissionsintensitybasedonGDPtendtocharginginfrastructure,includingfundingforfastchargersatproducedforexport.Whilea2021KPMGstudyfoundoverstateIreland’srecentprogressondecarbonization.Thehundredsofsportsclubsaroundthecountry.9Connollysaysthatemissionsreductionsofaround20percentcouldcountry’sCentralStatisticsOfficecompilesanalternativethattransportemissionsrisingby6percentin2022showsthatbeachievedthroughwidespreadadoptionofprovenmeasuredesignedtoexclude‘globalizationeffects’calledevenwithincreasedsalesofelectricvehiclesmoreneedstobetechnologies,goingbeyondthisatpresentwouldrequiremodifiedgrossnationalincome,whichroseby83percenttodonetoofferpeoplesafeandsustainablealternativestoprivatenewtechnologiesorreducedanimalnumbers.10EUR273billionoverthesameperiod.11cars.Headdsthatcostaloneisunlikelytochangebehavior1‘Ireland’sambitiousClimateActsignedintolaw’,IrelandDepartmentoftheEnvironment,ClimateandCommunications,23JulyNovember2021.h­t­t­p­s://w­w­w.gov.ie/en/press-release/9336b-irelands-ambitious-climate-act-signed-into-law/2‘Irelandprojectedtofallwellshortofclimatetargets,saysEPA’,IrelandEnvironmentalProtectionAgency,1June2023.h­t­t­p­s://w­w­w.epa.ie/news-releases/news-releases-2023/ireland-projected-to-fall-well-short-of-climate-targets-says-epa.php3RussellSmythandJamesDelahunt,‘Ireland’soffshorewindpipeline’,KPMGinIreland,14March2022.https://kpmg.com/ie/en/home/insights/2022/03/irelands-offshore-wind-pipeline-infra-gov.html4‘NationalHydrogenStrategy’,IrelandDepartmentoftheEnvironment,ClimateandCommunications,12July2023.h­t­t­p­s://w­w­w.gov.ie/en/publication/624ab-national-hydrogen-strategy/5‘OffshoreWindDeliveryTaskforce’,IrelandDepartmentoftheEnvironment,ClimateandCommunications,11August2022.h­t­t­p­s://w­w­w.gov.ie/en/publication/c8749-offshore-wind-delivery-taskforce/6‘RenewableElectricitySupportScheme:ORESS1finalauctionresults’,EirGrid,14June2023.h­t­t­p­s://w­w­w.eirgridgroup.com/site-files/library/EirGrid/ORESS-1-Final-Auction-Results-(OR1FAR).pdf7‘ESBandØrstedenterpartnershipinlandmarkIrishoffshorewindagreement’,Ørsted,2June2023.h­t­t­p­s://orsted.com/en/media/newsroom/news/2023/06/202306026834118‘ClimateActionPlan2021—SecuringOurFuture’,IrelandDepartmentoftheTaoiseach,4November2021.h­t­t­p­s://w­w­w.gov.ie/en/press-release/16421-climate-action-plan-2021-securing-our-future/9‘Changestograntsforprivatelypurchasedelectricvehicles’,IrelandDepartmentforTransport,22March2023.h­t­t­p­s://w­w­w.gov.ie/en/press-release/e0766-changes-to-grants-for-privately-purchased-electric-vehicles/10‘Ireland’s2030carbonemissionstargets—aneconomicimpactassessmentfortheagriculturesector’,KPMGinIreland,October2021.https://assets.kpmg.com/content/dam/kpmg/ie/pdf/2021/11/ie-ireland-2030-carbon-emissions-targets.pdf11‘AnnualNationalAccounts2022:GNIandDe-GlobalisedResults’,IrelandCentralStatisticsOffice,14July2023.h­t­t­p­s://w­w­w.cso.ie/en/releasesandpublications/ep/p-ana/annualnationalaccounts2022/gniandde-globalisedresults/52NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-17%-43%-7%-6%-20%-8%-3%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)-66%-54%-62%-61%-73%-46%-150%-100%-50%0%50%100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData53NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsItalyItalyhasmadestrongprogressonenergyefficiency,withObstaclestoauthorizationtheInternationalEnergyAgency(IEA)notinginarecentItalyhasstrengthsinenergyefficiencyreportthatsince2010energydemandhasdecoupledfromHowever,someobstaclesareslowingthedevelopmentofanditsplanstobecomeahubforeconomicgrowthandthatthecountryisontracktoreachnewenergygeneration,whileinfrastructureaimedatcapturinggreenhydrogen,butdifficultiesgainingits2030nationaltargetinthisarea.1Thecountryisalsoandstoringcarbondioxideislimitedorstilltobedeveloped.authorizationstodevelopnewpowerplanningtoenduseofcoaltogenerateelectricityby2025“Authorizationprocessesslowdownthedevelopmentofnewgenerationandrenovatehomes,particularlyandmaymanagethisin2024,itsenvironmentministerinstallations,”saysStefanoGiacomelli,AssociatePartner,olderandhistoricones,posechallenges.GilbertoPichettoFratinsaidinJune.ItincreaseditsuseofKPMGinItaly.Buildinganewsolarphotovoltaicplantrequirescoalin2022toprovidealternativestogasimportedfromtheinvolvementofmanystakeholdersandinstitutionsthatcanRussia,butthecountryintendstoincreasetheproportionofelectricitygeneratedfromrenewablesfromone-thirdtoGHGemissionssplitbysector(2022)two-thirdsby2030,headded,althoughtherearenoplans4%Energyexcludingelectricitytoreintroducenuclearpowerafterthecountryvotedtoabandonitina1987referendum.225%ElectricityThegovernmentisfocusedondevelopinggreenhydrogen24%Transportproducedfromrenewableenergy,basedpartlyonItaly’slocationbetweennorthernAfricaandcentralEurope.InJune,18%BuildingstheGermanChancellorOlafScholzandItalianPrimeMinisterGiorgiaMeloniagreedtoapipelinethatcouldcarryhydrogen17%Industryaswellasnaturalgasbetweentheirtwocountries,following8%AgricultureanannouncementinMaybytheItalian,GermanandAustrian4%WastegovernmentssupportingaSoutH2Corridorhydrogen-readypipelinesystemthatwouldstretch3,300kilometersbetweenSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,ItalyandnorthernAfrica.3h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023InOctober2022,energycompaniesEnelGreenPowerandENIannouncedtheywillreceivepublicfundingtosetupelectrolysissystemstoproducegreenhydrogenattwoENIrefineriesinGelaandTaranto.4InJunethisyear,FrenchenergycompanyEDF’sItaliansubsidiaryEdisonopenedarenovatednaturalgas-firedpowerstationnearVenicethatcanrunpartlyonhydrogen,whichwaspresentedbythegovernmentasastrategicdevelopmentinthecountry’senergytransition.554NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactstakealongandunpredictabletimetocompletetheirwork,hesaysthatfurtherprogressmaybechallengedbytheageCarbonBorderAdjustmentMechanism.RiccardoLucarelli,says,withplansinfluencedbythepresenceofnearbyhistoricofmanyItalianhomesthatwerebuiltbeforeenergy-AssistantManager—Sustainability&ClimateChangesitesinacountrythathasmanyofthem.savingregulationswereintroduced,meaningtheyrequireServices,KPMGinItaly,saysitwillbeimportanttoensurerenovation,andthiswillbeharderforthoseofhistoricthatthesechangesencouragedecarbonizationinatargetedItalyhasalreadyachievedsomeprogressindecarbonizingimportance.Therearealsoconflictingdemandsontheway,suchasthroughdevelopinggreenhydrogenandcarbonbuildings.TheIEAsaysthatenergyconsumptionisfallinggovernmenttoprovidemoresocialhousing.captureandstorage.forresidentialandcommercialproperty,withthesectorexpectedtoprovide60percentofoverallannualenergyThecountry’sindustrialuserswillbeaffectedbythesavings,encouragedthroughgovernmentpoliciesdesignedwithdrawalofalmostallfreeallowancesundertheEUtoencouragerefittingexistingbuildings.6GiacomelliEmissionsTradingSchemeandthetransitiontothebloc’s1‘Energyefficiency’,Italy2023energypolicyreview,InternationalEnergyAgency,May2023.h­t­t­p­s://w­w­w.iea.org/reports/italy-20232FrancescaLandini,‘Italycouldabandoncoalby2024,environmentministersays’,Reuters,5June2023.h­t­t­p­s://w­w­w.reuters.com/world/europe/italy-could-abandon-coal-by-2024-environment-minister-says-2023-06-05/3RachelMoreandFrancescaLandini,‘Germany,Italysupportnewhydrogen-readypipelineproject’,Reuters,8June2023.h­t­t­p­s://w­w­w.reuters.com/business/energy/germany-italy-support-new-hydrogen-ready-pipeline-project-2023-06-08/4‘Greenhydrogen:IPCEIHy2USEtofundjointprojectsinGelaandTarantobetweenEnelGreenPowerandENI’,ENI,13October2022.h­t­t­p­s://w­w­w.eni.com/en-IT/media/press-release/2022/10/green-hydrogen-projects-gela-taranto.html5GiancarloNavachandFrancescaLandini,‘Edisonopens‘strategic’hydrogen-readypowerplantnearVenice’,Reuters,16June2023.h­t­t­p­s://w­w­w.reuters.com/business/energy/edison-inaugurates-power-station-running-hydrogengas-mix-2023-06-16/6‘Foreword’,Italy2023energypolicyreview,InternationalEnergyAgency(asabove).55NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-32%-32%-39%-23%-23%-45%3%-48%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)53%12%-32%-36%-24%-23%-40%-48%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData56NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsJapanhaslimitedlandforonshorerenewablepowergenerationneutralityby2050throughtheuseofgreentransformationorandfewshallowseassuitableforfixed-bottomwindturbines.1‘GX’.6Withcompaniesfromarangeofindustries,thegroupisToutilizedeepwaterareas,thegovernmenthasupdatedworkingtodevelopplansincludingrulestocreatemarketsanditsBasicPlanonOceanPolicyandpreparedlegislationthatacarboncreditexchangescheme.7wouldallowthedevelopmentoffloatingwindturbinesinInFebruarythisyear,thegovernmentpublishedabroadGXJapan’slargeexclusiveeconomiczoneofoceanaswellaspolicywhichwasapprovedbyJapan’sCabinetinJuly.Aswellwithinitsmuchsmallerterritorialwaters.2Thegovernmentascoveringtheexpansionofnuclearpowerandrenewablesacknowledgesthatwindpowerplaysamajorroleforreachingandexploringtheuseofcarboncaptureandstorageforpowernetzeroemissiontargets.GHGemissionssplitbysector(2022)Whilethecountryislookingatdevelopinggreenhydrogenandammoniaproduction,doingsowouldrequirelargeamounts4%Energyexcludingelectricityoflow-carbonelectricity.AyakoTorii,ManageratKPMGinJapan,saysJapanaimstosupply12milliontonnesofhydrogen42%Electricityannuallyby2040throughthepublicandprivatesectorsJapaninvesting15trillionyen(JPY)(US$101billion)accordingtothe16%Transportgovernment’srevisedhydrogenstrategypublishedinJune2023.311%BuildingsThegovernmentlookstodeveloplowcarbonenergysources,includingfloatingInAugust2022,PrimeMinisterFumioKishidaannouncedanew22%Industrywind,greenhydrogenandnuclear,whilefocusonnucleargeneration,representingasignificantshiftin4%establishinggreentransformationpoliciespolicy.4Thecountryidledmostitsplantsandplannedtophase1%AgricultureandinitiativesincludingaGXLeagueforoutnuclearpowerby2030afteranearthquakeandtsunamiWastecompaniestocollaborateondecarbonization.in2011.FollowingKishida’sremarks,inDecember2022thegovernmentadoptedaplantoextendthelifeofworkingreactorsSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,beyondanexisting60-yearlimit,restartstationsnotcurrentlyinh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023useandbuildnewreactors.5GXLeagueandpolicyTechnologyisattheheartofotheraspectsofJapan’sdecarbonizationefforts.InFebruary2022theMinistryofEconomy,TradeandIndustryannouncedplansforaGXLeague,agroupofcompanieswillingtoworktowardscarbon57NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsgeneration,itincludesplansforthegradualintroductionofanMitsubishiandNissanwereamongthefirsttoproduceelectricTheagricultureministryhasdevelopedastrategyforemissionstradingsystemandcarbonpricingmechanism.8vehicles,buttheirsuccessinsellinghybridsthatcombineuseofsustainablefoodsystemsknownasMidori,whichincludesToriisaysGXtransitionbondswillbeissuedtosupportprivatefossilfuelsandbatterytechnologyhasledtothemfallingbehindendingfossilfueluseinagriculture,forestryandfisheriesbyinvestmenttowardsdecarbonization.ThegovernmentisChinese,AmericanandEuropeanmanufacturersonsalesofpurely2050andhassimilaritieswiththeEU’s‘farmtofork’foodfocusingGXworkonhydrogenandammoniaproduction,carbonelectricvehicles.9Meanwhile,publicuseofJapan’srenownedsystemsstrategy.11InAugust2022theministrysetinterimrecyclingfuel,fuelcellsandotherdecarbonizationtechnologies.railsystemfellsharplyduringtheCOVID-19pandemicleadingtargetsfor2030underitsstrategy,includinga10.6percentsomepeopletomovetocarbon-intensivecartravel.However,railreductionincarbondioxideemissions.12Japanhasbeenrelativelysuccessfulindecarbonizingtransport,butpassengernumbersduringAprilandMay2023’sGoldenWeektherearechallengesahead.Automotivemanufacturersincludingholidayperiodrecoveredto94percentofthe2018level.101‘OffshorewindpowerinJapan,too’,RenewableEnergyInstitute(Japan).h­t­t­p­s://w­w­w.renewable-ei.org/en/activities/projects/osw_message_202304.php2‘Japan’snewmaritimepolicytopromotedecarbonization,offshorewindpower’,JapanNews,2March2023.h­t­t­p­s://japannews.yomiuri.co.jp/business/economy/20230302-94570/3‘Japantoinvest$100bninhydrogensupplyfordecarbonization’,NikkeiAsia,6June2023.h­t­t­p­s://asia.nikkei.com/Spotlight/Environment/Japan-to-invest-100bn-in-hydrogen-supply-for-decarbonization4MayuSakodaandYoshifumiTakemoto,‘Japansignalsreturntonuclearpowertostabiliseenergysupply’,Reuters,24August2022.h­t­t­p­s://w­w­w.reuters.com/world/asia-pacific/japan-pm-call-development-construction-new-generation-nuclear-power-plants-2022-08-24/5MariYamaguchi,‘Japanadoptsplantomaximizenuclearenergy,inmajorshift’,AssociatedPress,22December2022.h­t­t­p­s://apnews.com/article/russia-ukraine-business-japan-climate-and-environment-02d0b9dfecc8cdc197d217b3029c58986‘GXLeagueBasicConceptAnnounced,CallforEndorsingCompaniesStarts’,JapanMinistryofEconomy,TradeandIndustry,1February2022.h­t­t­p­s://w­w­w.meti.go.jp/english/press/2022/0201_001.html7‘AboutGXLeague’,GXLeague.h­t­t­p­s://gx-league.go.jp/en/8TakeoKumagaiandAtsukoKawasaki,‘Japan’sgreentransformationpolicytoalterLNGcontractstrategies’,S&PGlobalCommodityInsights,17February2023.h­t­t­p­s://w­w­w.spglobal.com/commodityinsights/en/market-insights/latest-news/energy-transition/021723-japans-green-transformation-policy-to-alter-lng-contract-strategies9KoFujioka,‘HowsuccessinhybridcarsturnedJapanintoanEVlaggard’,NikkeiAsia,29December2022.h­t­t­p­s://asia.nikkei.com/Business/Business-trends/How-success-in-hybrid-cars-turned-Japan-into-an-EV-laggard10‘GoldenWeekexpresstrainpassengersat94%ofpre-pandemiclevel’,TheJapanTimes,8May2023.h­t­t­p­s://w­w­w.japantimes.co.jp/news/2023/05/08/national/golden-week-train-passengers/11‘StrategyforSustainableFoodSystems,Midori’,JapanMinistryofAgriculture,ForestryandFisheries.h­t­t­p­s://w­w­w.maff.go.jp/e/policies/env/env_policy/meadri.html12‘Japansetsnew2030targetsforGreenFoodSystemStrategy’,USDepartmentofAgricultureForeignAgriculturalService,22August2022.h­t­t­p­s://w­w­w.fas.usda.gov/data/japan-japan-sets-new-2030-targets-green-food-system-strategy58NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-16%-28%4%-27%-29%-26%2%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)-21%-32%3%-34%12%-32%30%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData59NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsMexicoMexico’sworktowardsnetzeroemissionsisbeingstrengthenedintroducingelectricbusrapidtransitvehicles.OtherworkincludesunderfourmajorconstituentpartsaccordingtoAliciaMorenoregulationsonvehicleefficiency,thedevelopmentofcleanThecountryhasstrengtheneditsLara,ESGStrategyDirector,KPMGinMexico.TheMexicantransportationprograms,urbanplanningthatincreasesspacedecarbonizationtargetsandproducedEmissionsTradingSystemmovedin2023fromapilotphasetoanforpedestriansandtheexpansionandrehabilitationoftherailsector-specificstrategieswithsocialaswelloperationalone.In2022,MexicotougheneditsUNclimatechangenetwork.Thegovernmenthasissuedadecreethatmakeslithium,asenvironmentalaims,whilerenovatingnationallydeterminedcontributions,increasingitsgreenhousegasusedinbatteries,astrategicmineralandpublishedanationalhydroelectricpowerplantsanddesigningemissionsreductiontargetfrom22percentto35percentby2030,strategytopromoteremoteworkingandreducecommuting.state-levelstrategiesforaddressingclimatecomparedwith1990levels,withthepossibilityofincreasingtheAswellasparticipatinginemissionstradingandcarbonpricingambitions.targetto40percentifitreceivessufficientinternationalsupportmechanisms,thegovernmentisaimingtodecarbonizeindustryonfinance,innovationandtechnologytransfer.1Duringrecentthrougharangeofstrategies,includingthecirculareconomy.60NetZeroReadinessReport2023yearsthegovernmenthasimplementedcarbontaxesatspecificstateleveljurisdictionsandinMarch2023itlaunchedtheMexicanGHGemissionssplitbysector(2022)sustainabletaxonomy,aclassificationsystemdesignedtodefinecriteriaforsustainableprojectsandactivitiesthatarealignedto11%Energyexcludingelectricitypositiveenvironmentalandsocialimpacts.216%ElectricityChallengesincludeestablishingfinancialmechanismsandcommitmentsforlong-termsupportaswellasdeveloping18%Transportdetailedplansatfederalandregionallevel,Larasays.Mexico4%Buildingsshouldidentifyandimplementusefultechnologiesandensurethetechnicalskillsandcapacitiestousetheseaswellasto26%Industryimplementmitigationandadaptationactionsbasedonpoliticalwillandpublic-privatecollaboration.15%AgricultureMexicocurrentlygeneratesmostofitselectricityfromfossilfuels10%Wastebutplanstochangethisthrougharangeofmeasures,includingupgradingthehydroelectricpowerplantsthatproducemuchofSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,thecountry’srenewableenergy.3Thecountryisalsoworkingtoh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023integratecleanenergyintoelectricitygeneration,substitutehigh-carbonfuelswithnaturalgasinpowerplantsandreducetechnicallossesinthepowergrid.Itisalsoworkingonthedevelopmentofsolarpoweredhomesandthepromotionofgreenhydrogenuse.Ontransport,thegovernmentisfocusingonpublicserviceswhereimprovementsalsohavesocialbenefits,suchasby©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsInagricultureitispromotingfertilizersubstitution,reducedChangeinabsoluteemissions(2005–2022)16%agriculturalburningandthecaptureandmanagementoflivestockbiogas.Thecountryisworkingtodevelopcarboncapturethrough-11%itsENAREDD+strategytoreduceemissionsfromdeforestation-4%andforestdegradation,althoughitneedstosetandstrengthenspecificactionstomeetitsambitiousgoalstoincreasetheland10%48%coveredbynaturalprotectedareas.4%4%48%Whilethegovernmenthasdevelopednumerousstrategies,Larasaysthatalotofinitiativesinplacestillneedtosetclearrulesof24%operation,includingmechanismssuchastheEmissionsTrading31%Systemandcarbontaxes.“Therearestillquestionsoverhowthesewillbeapplied,howthepublic,privateandthirdsectorsare-150%-100%-50%0%50%100%150%goingtocollaborate,howskillsandcapabilitieswillbeattainedandhowwearegoingtoaccesssustainablefinanceforleveragingChangeinemissionsintensity(2005–2022)52%theseplans,”shesays.37%-12%1‘MexicoannouncesnewcommitmentstocombatclimatechangeatCOP27’,GovernmentofMexico,14November2022.h­t­t­p­s://w­w­w.gob.mx/sre/prensa/mexico--29%announces-new-commitments-to-combat-climate-change-at-cop27-16%2‘ComunicadoNo.16LaSecretaríadeHaciendapresentalaTaxonomíaSosteniblede-21%México’(inSpanish),GovernmentofMexico,15March2023.h­t­t­p­s://w­w­w.gob.mx/shcp/prensa/comunciado-no-16-la-secretaria-de-hacienda-presenta-la-taxonomia--13%sostenible-de-mexico-1%3CasBiekmann,‘Mexico’shydropowermodernizationexamined’,MexicoBusiness-150%-100%-50%0%50%Industry100%150%News,1October2021.h­t­t­p­s://mexicobusiness.news/energy/news/mexicos-EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWastehydropower-modernization-examinedSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData61NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsNetherlandsTheNetherlandshasincludednetzeroemissionsobjectivesinNetherlands.“Theyarereallycarefulaboutwheretheyspendarangeofnationalpolicies,includingthoseonwastereduction,theirmoney,butthatmeansyouoftenmakestrongerwhatThecountryhasstrongambitionsandruralareas,energyandtransport.Thelatestversionofitsisalreadystrong,makingitdifficulttodevelopnewideas.”nationalnetzeropolicies,butisseeingdecades-oldDeltafloodingandwatermanagementprogramForexample,theNetherlandshasmadestrongprogressonsignificantimplementationproblems,withincludespreparingforextremeweathersuchasthetorrentialdevelopingsolarpowerproductionbuttherearephysicalandEU-drivenrequirementstocutnitrogenrainfallexperiencedinLimburgin2021acrossthecountry.1Inadministrativeconstraintsingridinfrastructure.Thismeansthatemissionsleadingtomassprotestsby2019government,companiesandorganizationsagreedaclimateinsomeareasthegridnetworkoperatorwillnotallowneworfarmersanddelaystonewrenewableenergyagreementaspartofthecountry’sregularlyupdatedclimateplan.expandedconnections,whichparticularlyaffectsnewonshoreplants,alongwithareluctancetosubsidizewindparks,installationofsolarenergyandexpansionofchargingemergingenergytechnologies.ButtheNetherlandsisexperiencingproblemsimplementinginfrastructureforelectricalvehicles.Asaresult,moreenergysomeofthesepolicies.A2019courtrulingonreducingnitrogenstoragecapacityandinnovationtodevelopthisfurtherwillbea62NetZeroReadinessReport2023emissions,whichledtoaplantoclosearound11,200livestockkeypartoftheNetherlands’energytransition.farmsandsignificantlyreducethesizeof17,600more,resultedinwidespreadprotestsbyfarmers.2AprotestpartyfoundedtoGHGemissionssplitbysector(2022)opposetheseplanswonmoreseatsinMarch2023electionstotheDutchSenatethanPrimeMinisterMarkRutte’sparty.3This9%EnergyexcludingelectricitywasonefactorcontributingtothefailureofRutte’sattemptstocontinuehiscoalitiongovernmentinJuly,leadingtoageneral25%ElectricityelectioninNovemberandaninterimgovernmentuntilthen.4“Alotofplanswillbedelayedsignificantlyduetotherebeing16%Transportnoroomfordecisions,”saysUbbovanZessen,HeadofESG,KPMGintheNetherlands.14%BuildingsThenitrogenreductionruleshavealsoblockedorslowed22%Industryconstructionwork,includingsomefornewlowcarbonenergyproduction.InJulytheoutgoingchiefexecutiveoftheportof10%AgricultureRotterdamsaidthattheneedtoapplyfornitrogenemission4%WastepermitsishinderingconstructionofgreenhydrogenandbiofuelplantsbycompaniesincludingShellandNesteattheport.5Source:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023ImprovingexistingenergytechnologiesThegovernmentfocusesitsenergydevelopmentsubsidiesonimprovingexistingtechnologiessuchassolar,offshorewindandcarboncaptureandstorage,ratherthanemergingonesincludinggreenhydrogenandgeothermal.“Theyarenotrisk-minded,”saysBobHoogendoorn,DirectorofSustainability,KPMGinthe©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsThecountryfacesissueswithitscarbonpricingsystem,whichChangeinabsoluteemissions(2005–2022)-4%givessomeindustrialexportersadvantageswhichcanwork-5%againstsmallercompaniesinthefoodprocessingsector,although-26%internationalcompetitionandEUpoliciesarecounteracting-21%this.Meanwhile,theimplementationoftheEU’sCorporateSustainabilityReportingDirective,requiringcompaniestoreport-31%onclimatechangeaswellasotherimpactsontheenvironment-21%andsociety,islikelytoacceleratecorporatedecarbonizationworkandshouldmotivategovernmentagenciestodolikewise.-39%-21%TheNetherlandsalsohasthepotentialtodevelopcarboncaptureandstorage,alternativeconstructionmaterialsandworktosave-32%energy.Ithasmadesignificantprogressonsavingenergyrecentlyduetohighenergyprices,somethingwhichisanessentialpart-150%-100%-50%0%50%100%150%ofmeetingdecarbonizationtargetsandmakingasuccessoftheenergytransition.Changeinemissionsintensity(2005–2022)1‘BrochureoutlinesDeltaProgramme2023’,NetherlandsNationalDelta-42%Programme,20September2022.h­t­t­p­s://english.deltaprogramma.nl/documents/publications/2022/09/20/brochure-outlines-delta-programme-2023-english-47%-39%2‘WhyDutchfarmersareprotestingoveremissionscuts’,BBCNews,29July2022.h­t­t­p­s://w­w­w.bbc.com/news/world-europe-62335287-53%-33%3BartMeijer,‘Dutchfarmers’protestpartyscoresbigelectionwin,shakingupSenate’,-18%Reuters,16March2023.h­t­t­p­s://w­w­w.reuters.com/world/europe/farmers-protest-party-set-shake-up-dutch-political-landscape-2023-03-15/-47%4CharlotteVanCampenhoutandBartMeijer,‘Dutchpolls,firstinyearswithoutPM-150%-100%-50%0%50%Industry100%150%RutteatVVDhelm,setforNovember’,Reuters,14July2023.h­t­t­p­s://w­w­w.reuters.EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWastecom/world/europe/dutch-election-be-held-nov-22-nos-2023-07-14/Source:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorld5AndyBounds,‘Dutchemissionslawsstall€10bnofgreeninvestmentatEurope’sEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenDatabiggestport’,FinancialTimes,19July2023.h­t­t­p­s://w­w­w.ft.com/content/cc024ad9-f9ab-46f8-a212-a5a23b531c0eand‘HavenvanRotterdam:alsstikstofcrisisnietsnelwordtopgelost,dreigenwemiljardenmistelopen’(inDutch),NPORadio1,9May2023.h­t­t­p­s://w­w­w.nporadio1.nl/nieuws/binnenland/ed4eb9c2-6145-4cb9-9942-ed3636c9fd9a/directeur-haven-van-rotterdam-als-stikstofcrisis-niet-snel-wordt-opgelost-dreigen-we-miljarden-mis-te-lopen63NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsNewZealandisoneofjusttwocountriesintheNZRRwhereThegovernment’smanagementoftheNZETShasitselfagricultureandlanduseareresponsibleformorethanhalfofcausedproblems.InDecember2022thegovernmentdecidedtotalemissions.Thecountryisamajoragriculturalexporter,toloosenitspriceandunitsettingsoverconcernsthatitsexpectingtosell25.1billionNewZealanddollars(NZD)graduallyincreasingcarbonpricewouldcontributetohigher(US$15.1billion)ofdairyproductsandNZD11.9billionofmeatfuelandelectricitycostsforconsumers,despiteadviceandwooloverseasintheyeartoJune2023.1NewZealand’sagainstthisfromthecountry’sClimateChangeCommission.3agriculturalsectorisalreadyhighlyefficientandcontinues“Thechangesresultedinmarketparticipantslosingtomakeprogressindecouplingemissionsfromproduction.However,thespeedandscaleofreductionsinagriculturalGHGemissionssplitbysector(2022)emissionsrequiredtomeetthecountry’s2030commitmentsarenotbeingrealized,saysDrCharlesEhrhart,HeadofClimate3%EnergyexcludingelectricityRisk,ResilienceandAdaptation,KPMGInternationaland6%ElectricityPartner,Co-LeadClimateChange,Decarbonization,ESGand17%Sustainability,KPMGinNewZealand.TransportThegovernmentformedapartnership,HeWakaEkeNoa,4%Buildingswithrepresentativeorganizationsoffarmersandgrowers,13%Industrywhichwastaskedwithestablishingaplantomeasure,NewZealandmanageandreduceon-farmagriculturalgreenhousegas51%Agricultureemissionsandadapttoclimatechange.Thepartnership’sworkAlackofagreementonplanstoreduceincludeddevelopingproposalsforaneffectivesystemtoprice6%Wasteemissionsfromlivestockfarmingandaagriculturalemissionsfrom2025.InOctober2022,itpublishedreversedgovernmentinterventionintheaproposalonemissionpricingatthefarmlevel.2EhrhartSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,emissionstradingschemearecausesforsays:“HeWakaEkeNoahasnotsucceededindevelopingah­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023concern,buttheindustrialandelectricitymutuallyacceptableapproachtopricingagriculturalemissions.sectorsaremakinggoodprogress.Wearenotmakingtheprogressrequiredtoidentify,muchlessexecute,acollaborativesolutiontodecarbonizingNewZealand’sagriculturesector.”Ifaschemeforthesectorcannotbeagreedwithfarmers,thegovernmentplanstoaddagriculturetotheNewZealandEmissionsTradingScheme(NZETS)byJanuary2025.64NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsconfidence,failedauctionsofcreditsandaslideinthecarbonFund,whichaimstoacceleratedecarbonizationbyprovidingcleanelectricity,suchaseasingbottlenecksonplanningandpricefromaroundNZD90perMtCO2einNovember2022toco-fundingforinitialcapitalcostsoffuelswitchingtopermitsfornewrenewablegenerationandincreasedgridNZD35on5July2023,”saysMarkusVencatachellum,Seniorrenewables.6KPMGinNewZealandhasadvisedthefund’scapacitytosupportthis.Advisor,CarbonMarketspractice,KPMGinNewZealand.4Themanager,theNewZealandEnergyEfficiencyandConservationpricerosesharplyon25JulywhenthegovernmentannouncedAuthority,onstructuringgrantfundingforthesteelindustry.7Transportdecarbonizationismorechallenging,withmostitwastighteningpriceandunitsettingsagain,havinglostaWithGIDIsupport,NZSteelwillreplaceexistingtechnologyofthecountrylackingpopulationdensitiesthatcansupportjudicialreview.5withwhatisslatedtobethefirstelectricarcfurnaceinNeweffectivepublictransportandneglectedrailandcoastalZealand,reducingindustrialgreenhouseemissionsbyanshippingservices.EhrhartsaysthatmorecoherencefromFundforindustrialdecarbonizationestimated800ktCO2eannually.8governmentondecarbonizingthesector,includingworktoencourageadoptionofelectricvehicles,wouldbewelcome.Inothersectors,NewZealandismakinggoodprogress.TheIndustry’sdecarbonizationissupportedbythefactthatgovernmentischannelingproceedsfromitsETSthroughthemostelectricitycomesfromlow-carbonsources.ThereisGovernmentInvestmentinDecarbonisingIndustry(GIDI)cross-partyagreementonfurtherdevelopmentstosupport1‘Situationandoutlookforprimaryindustries’,NewZealandMinistryforPrimaryIndustries,June2023.h­t­t­p­s://w­w­w.mpi.govt.nz/resources-and-forms/economic-intelligence/situation-and-outlook-for-primary-industries/2‘Consultationonproposalstopriceagriculturalgreenhousegasemissions’,NewZealandMinistryfortheEnvironment,11October2022.h­t­t­p­s://environment.govt.nz/news/consultaton-on-government-proposals-to-price-agricultural-greenhouse-gas-emissions/3MarcDaalder,‘CabinetoverridesShawandCommissiononcarbonprice’,Newsroom,16December2022.h­t­t­p­s://w­w­w.newsroom.co.nz/sustainable-future/cabinet-overrides-shaw-and-commission-on-carbon-price4AgamoniGhoshandKshitizGoliya,‘NewZealandcarbonpricesrallyasgovernmentstrengthensETSpricesettings’,S&PGlobalCommodityInsights,27July2023.h­t­t­p­s://w­w­w.spglobal.com/commodityinsights/en/market-insights/latest-news/energy-transition/072723-new-zealand-carbon-prices-rally-as-government-strengthens-ets-price-settings5‘EmissionsTradingSchemesettingsupdated’,NewZealandGovernmentpressrelease,25July2023.h­t­t­p­s://w­w­w.beehive.govt.nz/release/emissions-trading-scheme-settings-updated6‘AbouttheGovernmentInvestmentinDecarbonisingIndustryFund’,NewZealandEnergyEfficiencyandConservationAuthority.h­t­t­p­s://w­w­w.eeca.govt.nz/co-funding/industry-decarbonisation/about-the-government-investment-in-decarbonising-industry-fund/7‘NZ’sbiggesteveremissionsreductionprojectunveiled’,NewZealandGovernmentpressrelease,21May2023.h­t­t­p­s://w­w­w.beehive.govt.nz/release/nz%E2%80%99s-biggest-ever-emissions-reduction-project-unveiled8LukeMalpass,‘Governmentannouncesmassiveemissions-cuttingdealwithNZSteel,ContactEnergy’,Stuff,21May2023.h­t­t­p­s://w­w­w.stuff.co.nz/national/politics/132102525/government-announces-massive-emissionscutting-deal-with-nz-steel-contact-energy65NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-27%-6%-54%-4%3%-1%-150%-100%-50%-3%28%100%150%-5%50%0%Changeinemissionsintensity(2005–2022)-37%54%-54%-31%-34%5%-17%-37%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData66NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsNorwayNorwaygeneratesnearlyallofitselectricityfromhydroThecountryisdevelopingoffshorewindgeneration,power,usesthisrenewableelectricitytoheatmosthomesdrawingonitsexperienceinoffshoreoilandgas,andbyThecountryisaleaderindecarbonizationaswellaspowerthemandhasledtheworldinadopting2040hopestoallocateareaswiththecapacitytoproduceeffortswithmostnewcarsnowelectricallyelectricvehicles.Thecountryhassetalegallybindingtarget30GWofelectricity.InMarch,thegovernmentannouncedpowered,butanewgovernmentistoreachnetzeroemissionsby2050butisaimingtobecompetitionstobuildturbinesintheUtsiraNordandSørligedevelopingratherthandismantlingthecarbonneutralassoonas2030byoffsettingitsemissions,NordsjøIIprojectareas.4Atthesametime,thebuildingofacountry’seconomicallykeyoilandgasincludingthroughanagreementwiththeEUtotakepartinlargeonshorewindfarmof151turbinesinNorway’sFosenproduction,reflectingdilemmasoverhowtoitsEmissionsTradingSystemdespitenotbeingamemberofdistricthasledtoprotestsandlegalactionbyanindigenousmakeanetzerotransitionwork.thebloc.Sámicommunitywhousetheareaforreindeerherding.5ButanewgovernmentelectedinOctober2021,ledbytheGHGemissionssplitbysector(2022)center-leftLaborpartywiththesupportoftherural-focusedCenterparty,saidsoonafterthatthecountry’slargeoil43%Energyexcludingelectricityandgassectorwouldbe“developed,notdismantled”.1InJanuarythisyearitofferedarecordnumberofareas2%ElectricityinitsArcticterritorialwaterstocompaniesforoiland18%Transportgasexploration.2InJune,itsparliamentapprovedthedevelopmentof19oilandgasfieldswhichwillinvolve4%Buildingsinvestmentsinexcessof200billionNorwegiankrone(NOK)(US$18.4billion),despiteprotestsbyenvironmentalists.325%Industry6%AgricultureCarlChristianChristensen,HeadofESGAdvisory&2%WasteAssurance,KPMGinNorway,saysthatotherEuropeancountrieshaveputpressureonNorwaytoproducemoreoilSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,andgastohelpcompensateforsuppliesreducedfollowingh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023embargosofRussiangassupply.“Weareinadilemmawhereononesidewearedeterminedtomakethistransitiontonetzeroworkovertime,butintheshortandmediumtermwestillhavetoproduceourshareofwhatthemarketneedsintermsofoilandespeciallygastoEurope,”hesays.Morebroadly,Norway’sdeterminationtodecarbonizecomesintoconflictwithitsnationalwealthandwelfaresystem,builtlargelyonrevenuefromoilandgasproduction.67NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsElectricecosystemadigitalnativeelectricitysupplierwhosetechnologybeingchallengedondecarbonizationbytheUSInflationhelpscustomerschargevehicleswhenelectricitypricesReductionAct,withNorwegianchemicalmanufacturerYaraNorwayhasledtheworldinelectrifyingroadtransport,arelowest.8Thecombinationoftaxincentivesandafastannouncingajoint-ventureinMarchtoproducelow-carbonwith88percentofnewcarssoldinthecountryin2022growingandwell-functioningecosystemhasacceleratedthe‘blue’ammoniainTexas.10eitherbatteryorplug-inhybridelectricvehicles,comparedadoptionofelectricvehiclesespeciallybyconsumers.with21percentacrosstheEU’s27members,andjustoverChristensensaysthatdespitethechallenges,Norway’saquarterofallcarsontheroadinNorwayareelectric.6In2021theagriculturalindustryagreedtoreduceitsconsensualculturemeansitislikelytocontinuetopressThegovernmentencouragedadoptionthroughtaxbreaksemissionsby5MtCO2eby2030throughmeasuresonwithdecarbonization,includingcompaniesadoptingandpriceincentives,withpreviouslylowelectricitypricesincludingmoreclimate-friendlyandsustainablelivestockstandards,plansandtargets:“Norwayisahigh-trustprovidingfurtherencouragement.Thishashelpeddevelopfodder,ashifttolowcarbonfuelssuchaselectricity,society.Basedonexperience,thiswilllikelysupporttheNorwegianstart-ups,includingcompanieslikeZaptec,biofuelsandhydrogenforfarmmachineryandusingsoiltransitiontowardsnetzeroforNorway,”hesays.whichmakeselectricvehiclehomechargers,7andTibber,forcarbonstorage.9Butinsomesectorsthecountryis1‘Norway’soilandgassectorwillnotbedismantled,newgovernmentsays’,BBCNews,13October2021.h­t­t­p­s://w­w­w.bbc.com/news/world-europe-588968502NerijusAdomaitisandGwladysFouche,‘NorwayplanstoofferrecordnumberofArcticoil,gasexplorationblocks’,Reuters,24January2023.h­t­t­p­s://w­w­w.reuters.com/business/energy/norway-offers-up-92-new-oil-gas-exploration-blocks-2023-01-24/3TerjeSolsvik,‘Norwayapprovesmorethan$18billioninoil,gasinvestments’,Reuters,28June2023.h­t­t­p­s://w­w­w.reuters.com/business/energy/norway-approves-more-than-18-bln-oil-gas-investments-2023-06-28/4‘Havvind’(inNorwegian),NorwegianGovernment.h­t­t­p­s://w­w­w.regjeringen.no/no/tema/energi/landingssider/havvind/id2830329/5‘Respectexistenceorexpectresistance:ProtestsinNorwayagainstwindfarmonSamiland’,EuronewsGreen,2June2023.h­t­t­p­s://w­w­w.euronews.com/green/2023/06/02/respect-existence-or-expect-resistance-protests-in-norway-against-wind-farm-on-sami-land6‘GlobalEVDataExplorer’,EVsalesandEVstocksharesforNorwayandEU27for2022,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/global-ev-data-explorer7‘AboutZaptec’,Zaptec.h­t­t­p­s://brand.zaptec.com/d/K8pkbUYNXePL/press-kit-1#/company/about-zaptec-16863174758‘Aboutus’,Tibber.h­t­t­p­s://tibber.com/en/about-us9‘Landbruketsklimaplan2021-2030’(inNorwegian),NorgesBondelag.h­t­t­p­s://w­w­w.bondelaget.no/bondelaget-mener/miljo-og-klima/klima/les-klimaplanen-her10VictoriaKlestyandRodNickel,‘YaraandEnbridgeplan$2.9blnammoniaplantinTexas’,Reuters,31March2023.h­t­t­p­s://w­w­w.reuters.com/business/energy/yara-enbridge-eye-29-bln-texas-ammonia-plan-2023-03-31/68NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-2%116%-6%-34%-7%-56%-3%-3%-150-100-50501001500Changeinemissionsintensity(2005–2022)-6%-27%94%-27%-49%-9%-37%-150%-100%-50%0%50%100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData69NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsSingaporeInOctober2022Singapore’sgovernmentsaiditplanselectricityfromCambodiathroughsubseacablesofmoretoreachnetzeroemissionsby2050,ratherthanaroundthan1,000kilometersinlength.3Theremaining3GWisSingaporehascommittedtonetzerobythisdateaspreviously,aswellassetatargetfor2030expectedtobeawardedbyendof2023.By2050the2050whileraisingitscarbontaxandlookingof60MtCO2ecomparedwitha2020businessasusualcountryislookingtodevelopgreenhydrogenproducedwithtoneighboringcountriesforrenewableprojectionof77.2MtCO2e.1“OverthelastfiveyearsSingaporerenewableenergyasitsmainenergysourceandisrunningelectricity.Itisworkingtoreplaceshipping’shasmadeaconsciousdecisiontomovetowardsnetzero,”researchandproofofconceptwork,whichshouldprovidebunkerfuelwithgreenammoniaandsaysSharadSomani,HeadofInfrastructureforKPMGAsiaopportunitiestodevelopanimportandexporthubforgreencontinuingtodecarbonizelandtransport.PacificandHeadofKPMGESGatKPMGinSingapore.“Forhydrogengivenitsexperienceinresearchanddevelopment.4acity-statedependentonimportsforalmostallitssuppliesofnecessitiesandbeingapetrochemicalsandlogisticshub,GHGemissionssplitbysector(2022)thisisthestartoflarge-scaleeconomy-widetransformation.”Headdsthatthegovernment’sreputationforstabilityandthe6%Energyexcludingelectricitypursuitofhighstandardswillsupportitsincreasingfocusondecarbonization.30%ElectricitySingaporeintroducedacarbontaxin2019,thefirstcountryin8%Transporttheregiontodoso,whichappliestoabout50high-emitting1%Buildingsfacilities.ItiscurrentlysetatSGD5(US$3.67)pertonneofcarbondioxideequivalentemittedbutwillrisesharplyto46%IndustrySGD25atthestartof2024thentoSGD45in2026,witharangefromSGD50-80plannedfor2030.2Thegovernment0%Agriculturehasalsolegislatedforcompaniestoappointenergymanagers8%Wasteandpublishenergyconservationplansonavoluntarybasis,whichithopeswillhelpdevelopbusinessopportunitiesinSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,greenfinancialservices.h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023Almostallofthecity-state’senergycomesfromimportedfossilfuelsandthereisverylittlespaceforrenewableenergyproduction,althoughthegovernmentenvisagestheinstallationofabout2GWofroof-topandfloatingsolarby2030.LastyeartheEnergyMarketAuthorityofSingaporelaunchedatenderfortheimportofupto4GWoflow-carbonelectricityby2035fromneighboringcountries.InMarchthisyearitgrantedconditionalapprovalfor1GWofrenewable70NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsThecity-stateimportswaterfromneighboringMalaysiaCleaninguptranshipmentThecity-statehasalreadydonealottodecarbonizelocalunderalong-termwatersupplyagreementwhichrunsuntiltransport,includingplansforallbusestorunonelectricityby2061.5SingaporeplanstobecomewaterindependentbeforeSingaporehoststheworld’slargestportfortranshipment,2025.Ithascutthenumberofcertificatesofentitlementforthatdatethroughrainwaterharvesting,desalinationplantstheprocessofmovingcargofromonevesseltoanotherprivatecarownershipitauctionstoenforcezerogrowthinandwaterrecyclingaswellasimportedwater.Desalinationaspartofajourney.Shippingcurrentlyreliesonbunkeroil,overallnumbers.9Asaresult,the3-monthaveragecostofaishighlyenergyintensivesothewaterauthorityPUBiswhichgenerateslocalairpollutionaswellgreenhousegas10-yearcertificateforalargercartripledfromSGD39,500inworkingontechnologyimprovementstoimproveefficiency.6emissions,butfollowingfeasibilityandsafetyworktheDecember2019toSGD118,900inJuly2023.10MaritimeandPortAuthorityofSingaporeexpectsitcanstartfuelingvesselswithgreenammoniaproducedwithrenewableelectricityfrom2026.7Ithasalsopublishedalong-termdecarbonizationplanforitsmaritimesector.81‘SingaporeCommitstoAchieveNetZeroEmissionsby2050andtoaRevised2030NationallyDeterminedContribution’,SingaporeNationalClimateChangeSecretariat,25October2022.h­t­t­p­s://w­w­w.nccs.gov.sg/media/press-releases/singapore-commits-to-achieve-net-zero/2‘Carbontax’,SingaporeNationalClimateChangeSecretariat.h­t­t­p­s://w­w­w.nccs.gov.sg/singapores-climate-action/mitigation-efforts/carbontax/3‘EMAGrantsConditionalApprovalfor1Gigawatt(GW)ofElectricityImportsfromCambodia’,SingaporeEnergyMarketAuthority,16March2023.h­t­t­p­s://w­w­w.ema.gov.sg/media_release.aspx?news_sid=20230316xWTI36SCKjwW4SharadSomani,‘TakingSingaporeforwardasaregionalgreenhydrogenhub’,KPMGinSingapore,2July2022.https://kpmg.com/sg/en/home/media/press-contributions/2022/07/taking-singapore-forward-as-a-regional-green-hydrogen-hub.html5‘Wateragreements’,SingaporeMinistryofForeignAffairs.h­t­t­p­s://w­w­w.mfa.gov.sg/SINGAPORES-FOREIGN-POLICY/Key-Issues/Water-Agreements6‘Desalinatedwater’,SingaporePUB.h­t­t­p­s://w­w­w.pub.gov.sg/watersupply/fournationaltaps/desalinatedwater7RongweiNeo,‘INTERVIEW:Singapore’sMPAseesearliestammoniabunkeringfrom2026,methanolpilottopaveway’,S&PGlobalCommodityInsights,3July2023.h­t­t­p­s://w­w­w.spglobal.com/commodityinsights/en/market-insights/latest-news/lng/070323-interview-singapores-mpa-sees-first-ammonia-bunkering-from-2026-methanol-pilot-to-pave-way8‘MaritimeSingaporeDecarbonisationBlueprint:WorkingTowards2050’,MaritimeandPortAuthorityofSingapore,2022.h­t­t­p­s://w­w­w.mpa.gov.sg/maritime-singapore/sustainability/maritime-singapore-decarbonisation-blueprint9‘CertificateofEntitlementQuotaforNovember2021toJanuary2022,andVehicleGrowthRatetomaintainuntil31January2025’,SingaporeLandTransportAuthority,15October2021.h­t­t­p­s://w­w­w.lta.gov.sg/content/ltagov/en/newsroom/2021/10/news-releases/COE_quota_for_Nov21_to_Jan_22.html10COEbiddingresults,quotapremiumandprevailingquotapremiumdatafrom‘Statistics’,SingaporeLandTransportAuthority.h­t­t­p­s://w­w­w.lta.gov.sg/content/ltagov/en/who_we_are/statistics_and_publications/statistics.html71NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)38%-39%14%5%14%112%60%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)-35%-51%-24%-2%-25%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData72NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsSouthAfricaSouthAfrica’sgreatestopportunitiestomovetowardsnetThegovernmenthasalsoallowedEskomtobypasssulfurzeroatpresentcomefromtheprivatesector.Foreign-listeddioxidepollutioncontrolsatitsKusilecoalpowerstationCompaniesarelikelytoleaddecarbonizationmultinationalsandcompanieswithinternationalinvestorssothecompanycouldresumeproductionfromgenerationworkbutthestateoftheeconomy,slowwillinmanycaseshavetoincreasetheirreportingonunitsproving2GWofelectricity,despitethisriskingseverepaceofregulatorychangeandunreliabilityclimatechangerisksanddevelopplanstodecarbonize.healthproblemsforthoselivingnearby.4“Stabilityofsupplyofelectricitysupplyarehinderingprogress,However,therearefinancialpressurestodelaysuchwork.rightnowoutweighscurrentemissionsconcerns,”sayswhileheavy-emittingindustriescould“ThereisnotabigdriveforcompaniesinSouthAfricaReddy,althoughthishasanimpactontheuptakeofleversbeaffectedbytheEU’sCarbonBorderthataretryingtomakeendsmeetinaverysloweconomyfordecarbonizationadoptedinothercountries.OneexampleAdjustmentMechanism.toembraceadditionalmeasureslinkedtonetzero,”saysistheslowadoptionofelectricvehiclesifaccesstopowerPieterScholtz,PartnerandAfricaESGLead,KPMGinneededforchargingthemisunreliableandsuchpoweris73NetZeroReadinessReport2023SouthAfrica.stillgeneratedfromcoal.ThegovernmentisdoinglittletohelporforcecompaniestoGHGemissionssplitbysector(2022)decarbonize,whetherthroughlegislationorothermeasures.AJune2021speechbyPresidentCyrilRamaphosadiscussed19%Energyexcludingelectricityanexpansionofrenewableenergy,whichatpresentprovidesonlyasmallproportionofthecountry’selectricity,butthis38%Electricityhasnotbeensustained.“Theslowpaceofregulatorychangeisachallenge,”saysPoogendriReddy,AssociateDirector,10%TransportSustainabilityServices,KPMGinSouthAfrica.Plansfrom5%Buildings2019tobreakupthegovernment-ownedandcoal-dependent15%IndustrypowergroupEskomareprogressingslowly,althoughinJulythecountry’senergyregulatorlicenseditsplanstosetupa7%Agricultureseparatetransmissionoperator.16%WasteEskomfrequentlyimposes‘loadshedding’—plannedSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,powercuts—oncustomers,givenachroniclackofcapacityh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023resultingfromseverefinancial,plantandlaborproblemswithcutsoccurringon288daysin2022.InFebruary,PresidentRamaphosadeclaredastateofdisasterbecauseofwhathecalled“theelectricitycrisis”.2Aspartofitsresponse,inMarchthegovernmentcreatedanewministerofelectricitypost,initiallyheldbyKgosientshoRamokgopa,previouslytheheadofthePresidency’sInvestmentandInfrastructureUnit.3©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsCBAM’sindustrialimpactofproductsfromSouthAfricathatcouldattractchargeschangesrequiredmeansthesewilltaketimetoimplement.HeunderCBAMfrom2017-21withiron,steelandaluminumsaysthatSouthAfricancompaniesofallkindsneedtohaveaTheintroductionoftheEU’sCarbonBorderAdjustmentproductionmostlikelytobeaffected.5TheSouthAfricanstrategyfornetzerobasedongatheringaccuratedataontheirMechanism(CBAM)aswellassimilarschemeselsewhereRevenueServiceandNationalTreasuryareconsideringcurrentemissions,includingscope3onesfromsuppliers,thenwillprovidethecountry’sheavy-emittingindustrialresponsestoCBAM,whichwillbephasedinoverthenextdeveloplong-termplansbasedonthesewithatargetnetzerocompanieswithfinancialreasonstodecarbonize,byapplyingfewyears.dateandinterimreductiontargets.Headdsthatcompanieschargesonimportsdesignedtomatchcarbontaxesleviedinsomesectors,includingenergy,naturalresourcesandondomesticproducers.AFebruary2023paperpublishedbyScholtzsaysthatsomelargecompaniesintheenergyandtelecoms,aremakinggoodprogressonsuchplanning.SouthAfrica’sPresidentialClimateCommissionfoundthatnaturalresourcessectorshavebeenworkingonCBAMEUcountriesimportedanannualaverageofUS$1.4billionprogramsforacoupleofyears,butthelargescaleofthe1‘Energyregulatordecisionsofmeetingnumber262of27July2023’,NationalEnergyRegulatorofSouthAfrica.h­t­t­p­s://w­w­w.nersa.org.za/wp-content/uploads/bsk-pdf-manager/2023/07/Media-Statement-Energy-Regulator-Decisions-of-Meeting-No-262-of-27-July-2023_-1.pdf2CeciliaMacaulay,‘Eskomcrisis:WhatdoesSouthAfrica’sstateofdisastermean?’,BBCNews,10February2023.h­t­t­p­s://w­w­w.bbc.co.uk/news/world-africa-645944993PaballoLephaka,‘Profile:meetSA’sMinisterofElectricity,DrKgosientshoRamokgopa’,SABCNews,7March2023.h­t­t­p­s://w­w­w.sabcnews.com/sabcnews/profile-meet-sas-minister-of-electricity-dr-kgosientsho-ramokgopa/4ShereeBega,‘Eskom’sKusilepollutionrulesexemptiontoeaseblackoutsthreatenshealth’,MailandGuardian,16March2023.h­t­t­p­s://mg.co.za/environment/2023-03-16-kusile-pollution-rules-exemption-to-ease-blackouts-threatens-health/5‘CarbonborderadjustmentmechanismsandimplicationsforSouthAfrica’,PresidentialClimateCommission,February2023.h­t­t­p­s://w­w­w.climatecommission.org.za/publications/cbam74NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)5%18%3%-4%-22%34%-3%-11%-2%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)-29%-15%2%-13%-34%2%-45%-1%-150%-100%-50%0%50%100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData75NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsSouthKoreaInMarch,SouthKorea’sgovernmentconfirmedits2030companiesthatseektouse100percentrenewableenergy,targetofcuttinggreenhousegasemissionsby40percentalthoughSamsungwillinitiallyaimtoachievethisonlyforPlanstocut40percentofemissionsby2030comparedwith2018,onthewaytocarbonneutralitybyelectricityusedoutsideKorea.2involveexpansionofnuclearandrenewable2050.However,itreducedasector-specificreductiontargetArangeofemitterswillbeaffectedbyphase4ofKorea’senergybutreducingheavyuseoffossilfuelsforindustrybyplanningtoaccelerateashifttorenewableEmissionsTradingScheme(K-ETS)whichbeginsin2026,willtakeeffort.Somemanufacturinggroupsenergyandnuclearpower,whichthepreviousgovernmentupdatingaschemethatstartedin2015andmovedtothearesupportingsuppliersindecarbonizationhadintendedtophaseout.PresidentYoonSukYeol,whocurrentphase3in2021.3LeesaysthechangestoK-ETSwhiletheautomotivesectorshiftstoelectrictookofficein2022,isexpandingtheuseofnuclearenergyarelikelytoincludereductionsinfreecarbonallowancesandvehicles.toprovidemorethan30percentofelectricityby2030whilecoverageofadditionalsectors,althoughtheseareyettobehalvingcoal’scurrentshareofmorethan40percentaspartdecided,andthatthislookslikelytoencouragecompaniestoofmeetingthecountry’sUNemissionstargets.1GHGemissionssplitbysector(2022)DianaAhRyungLee,SeniorManager,KPMGinKorea,seesthewaythegovernmentusesemissionreductiontargetsasa8%Energyexcludingelectricitystrength.“Thegovernmentseeksachievableactionsthatcanreducegreenhousegasemissionsandboosttheeconomy41%Electricityatthesametime,”shesays.However,itmaybedifficulttoexpandrenewablegenerationsignificantlygivenlimitedamounts15%Transportofsuitablelandanditwilltakealotofefforttomoveaway8%Buildingsfromexistingheavyuseofcoal,naturalgasandoil.“Westillseechronicissuesrelatingtoenergyandpowergeneration,”20%Industrysheadds.4%Agriculture4%WasteCompaniessupportingsuppliersSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,Korea’seconomyisreliantonmanufacturingwithsmallandh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023mediumcompaniesinthesector,typicallysuppliersofthecountry’slargeindustrialgroupsandsomeofthelatterareprovidingtrainingandfinancialhelpfortheirsuppliers’effortstodecarbonize.InanenvironmentalstrategypublishedinSeptember2022SamsungElectronicssaiditwouldsupportitssuppliersinsettingandmeetingemissionstargets,includingbysharingresearchoncuttingemissionsfromsemiconductorproduction.Thecompanyalsocommittedtoachievingnetzeroemissionsby2050andjoinedtheglobalRE100groupof76NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsincreasedecarbonizationwork.Thecountry’sZeroEmissionsChangeinabsoluteemissions(2005–2022)25%Buildingsregulationsalreadymeanthatnewbuildingsmustincluderenewablegenerationcapacityandfrom2025these-14%66%willalsorequirethatoperatorsofexistingpublicsectorbuildingsremodelthese.42%InFebruary,thegovernmentannouncedreformstoelectric5%25%vehiclesubsidieswhichwillgivehigherweightingtotheperformanceandsafetyofvehiclesaswellastotechnological7%innovationandcustomerservicelevels.4JunesawHyundaiMotor,21%thecountry’sleadingautomotivemanufacturerwhosebrands31%includeKiaandGenesis,announcingacceleratedelectrificationtransitionplanswitha2030annualsalestargetoftwomillion-150%-100%-50%0%50%100%150%electricvehiclesconstructedinbothnewandconvertedfactories.5LeesaysthatacrosstheKoreanautomotivesectorthefocusisonChangeinemissionsintensity(2005–2022)movingtoelectric-onlyvehiclesratherthanhybrids.-27%1HyonheeShin,‘SouthKoreacuts2030emissionsreductionstargetsforindustry’,Reuters,21March2023.ht­t­­ps­://ww­w­.reuters.com/business/sustainable-business/-10%south-korea-cuts-2030-emissions-reductions-targets-industry-2023-03-21/-27%-50%-34-%50%2‘SamsungElectronicsannouncesnewenvironmentalstrategy’,SamsungElectronics,-35%14September2022.ht­­t­p­s://news.samsung.com/us/samsung-new-environmental-strategy-announcement-2022/1%-23%3‘SouthKoreaapprovesinitialwaveofnear-termETSreforms’,InternationalCarbonActionPartnership,5December2022.h­t­t­p­s://icapcarbonaction.com/en/news/south--150%-100%-50%0%50%Industry100%150%korea-approves-initial-wave-near-term-ets-reformsEconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWaste4‘EnvironmentministrytoreformruleonsubsidiesforthepurchaseofSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEVsin2023topopularizeEVs’,SouthKoreaMinistryofEnvironment,Energy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData24February2023.ht­­t­p­s://eng.me.go.kr/eng/web/board/read.do?menuId=461&orgCd=&boardId=1582640&boardMasterId=5225‘HyundaiMotorWaysetscourseforacceleratedelectrificationandfuturemobilitygoalsat2023CEOinvestorday’,HyundaiMotorCompany,20June2023.h­t­t­p­s://w­w­w.hyundai.com/worldwide/en/company/newsroom/%E2%80%98hyundai-motor-way%E2%80%99-sets-course-for-accelerated-electrification-and-future-mobility-goals-at-2023-ceo-investor-day-000001704877NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsSpainSpainhasdevelopedastrongregulatoryframeworkonpublicchargerstoencouragethemtogoelectric,withclimatechangebycombiningnationalandEuropeanSpainhaving20electricvehiclesforeachpublicchargingThegovernmenthasambitiousplanstoregulations,withmembershipoftheEUalsoprovidingpointcomparedwiththeEUaverageof13lastyear.5Thedeveloprenewablegeneration,phaseoutaccesstofinance.“Asaresultofthat,companiesandClimateChangeandEnergyTransitionlawpassedin2021nuclearandcoalby2025andupgradetheemittersneedtoadapt,”saysRamónPueyo,HeadofrequiresSpanishportstoreducedirectemissionstozerobycountry’selectricalgrid,butadoptionofSustainability,KPMGinSpain.“Ithinkwewerelatecomers2050andforthegovernmenttopromotetheuseofrailforelectricvehiclesmaybeslowedbyalackonclimatechangebutcitizensarenowawareofhowbiganpassengersandfreighttravelingdistancesgreaterthan300ofpublicchargersandfinancialincentivesissuethisisandhowweneedtodecarbonize.”kilometers.Aswithtransport,Pueyoaddsthatthebuildingstoswitch.sectorislikelytorequirefinancialincentivestohelphomesAkeypartofthisregulatoryframeworkisthecountry’senergyandbusinessesdecarbonize.78NetZeroReadinessReport2023andclimateplan(PlanNacionalIntegradodeEnergíayClima,PNIEC).Thefirstversionofthiswaspublishedin2020andtheGHGemissionssplitbysector(2022)governmentisconsultingonincreasingitstargetsfor2030,includingthat81percentofelectricityand48percentofall7%Energyexcludingelectricityenergyusewouldcomefromrenewablesources.1Adraftplan15%ElectricitypublishedinJune2023alsodoubledthecountry’s2030targetforbiogasproductionandnearlytripledthetargetforgreen28%Transporthydrogen,alongwithsmallerpercentageincreasesforwind,solarandpowerstorage.Italsoconfirmedplanstophaseout11%Buildingstheuseofnuclearenergyandbroughtforwardthedateforendingusecoalforelectricityfrom2030to2025.2In202218%IndustrythegovernmentagreedimprovementstoSpain’selectricitygridtohelpintegratemorerenewableproduction,including14%Agriculture2,700kilometersofnewtransmissionlines,700kilometers7%Wasteofunderseacablesandupgradesto8,000kilometersoftheexistingnetwork.3Source:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023ElectricvehiclesandchargersThegovernmentisambitioustomakeprogressonenergygenerationbutthisislesstrueofothersectors,saysPueyo.Transport,thehighest-emittingsector,hasseenelectricvehiclessalesgrowto8.9percentofallcarsinSpainin2022,butthisisbelowtheEUaverageof21percent.4Pueyosaysthatdriversmayneedfinancialincentivesandmore©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsSpain’sagriculturalsectorwillbeaffectedbytheupdatedChangeinabsoluteemissions(2005–2022)versionoftheEU’sCommonAgriculturalPolicy(CAP)whichcameintoeffectinJanuary2023andincludesstrengthened-28%protectionsforenvironmentalandclimateobjectives.Spain’sstrategicplanonhowitplanstoimplement-57%-18%20%CAPrequirementsincludesfinancialsupporttodevelop-44%-5%renewableenergyproductionbyfarmsaswellasimproving5%energyefficiencythroughbetterthermalinsulationof3%agriculturalbuildings.6-150%-100%-50%0%50%100%150%SmallercompaniesintheindustrialsectorwouldbenefitfrommorepragmaticadviceondecarbonizationtosupportChangeinemissionsintensity(2005–2022)smallercompaniesinsettingplansandtargets.“Wehavealackofawarenessamongmanagers,directorsandofficers-37%atsmallandmedium-sizecompanies,”saysPueyo.Thisparticularlyappliestonewreportingrequirementsunder-54%2021’sClimateChangeandEnergyTransitionlawandtheEU’sCorporateSustainabilityReportingDirective.-28%-17%1‘Publicconsultationonthedraftupdateof2023-2030PNIEC’,SpainMinistryfortheEcologicalTransitionandtheDemographicChallenge.h­t­t­p­s://energia.gob.es/en-us/-30%participacion/paginas/detalleparticipacionpublica.aspx?k=607-21%-10%2PietroLombardi,‘Spainraisesbetongreenhydrogen,biogasindraftplan’,Reuters,28June2023.h­t­t­p­s://w­w­w.reuters.com/sustainability/climate-energy/spain-doubles--150%-100%-50%0%50%100%150%down-green-hydrogen-biogas-2023-06-28/EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWaste3‘2026ElectricityGridDevelopmentPlan’,InternationalEnergyAgency,updated11May2023.h­t­t­p­s://w­w­w.iea.org/policies/17479-2026-electricity-grid-Source:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorlddevelopment-planEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData4‘GlobalEVdataexplorer’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/global-ev-data-explorer5‘NumberofelectricLDVsperpublicchargingpoint’,GlobalEVOutlook2023,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/reports/global-ev-outlook-2023/trends-in-charging-infrastructure6‘Ataglance:Spain’sCAPstrategicplan’,EuropeanCommission,24April2023.h­t­t­p­s://agriculture.ec.europa.eu/system/files/2023-04/csp-a-a-glance-spain_en.pdf79NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsSwedenSwedenhasbeenaleaderonsustainabilityforseveralcapitalandlandtobuild.Thecountry’sdispersedgeographyalsodecadeswithhighlevelsofawarenessamongbothmakestransportdecarbonizationchallenging,asitrequiresuseTocontinueitsstrongrecordofcompaniesandindividuals.Morethan90percentofelectricityofroadaswellasrailforfreight.Swedenhasseveralcompaniesdecarbonization,Swedenwillneedtocomesfromlowcarbonsources,primarilyhydropowerandworkingtoelectrifyheavyroadtransport,withtruckmakerABgeneratemorelowcarbonelectricityfromnuclear,andthecountryhascutitsoverallemissionsintensityVolvoofferingelectricfreightvehicles3anditscompetitorScaniaarangeofsourcesincludingnuclearpower.byaround60percentoverthelastthreedecades.recentlyannouncingajointlydevelopedbatterycellforelectricThecountry’sgeographyrequirestheusetruckswithgreenbatterymakerNorthvolt.4However,theirhighofroadfreight,withcompaniesdevelopingButtogofurtheritneedsmoreelectricity.Thecountrycouldcostcanbeoff-puttingforusers.electrictrucksandbatteries.greatlycutitsremainingemissionsbymovingafewlargeElectriccarsarenowthemajorityofnewvehicles,makingupindustrialcoalusersinsectorsincludingmining,steelandcement54percentofsalesin2022.5Westmansaysgrowthislikelyto80NetZeroReadinessReport2023toeithergreenhydrogengeneratedwithlowcarbonelectricitycontinuealthoughitmaybeslowedbytheeconomicdownturnordirectlytoelectricity,saysTorbjörnWestman,Partner,KPMGAssuranceServicesandtheHeadofAssurance,KPMGGHGemissionssplitbysector(2022)inSweden.Findingtheextragenerationcapacitywouldbeasignificantchallengewithnoeasyoptions.Someplanstoexpand5%Energyexcludingelectricityonshorewindgenerationareopposedbystakeholdersindifferent14%ElectricitypartsofSweden,forexampleindigenousSámicommunitiesasturbinesdisturbtheirreindeerandwaysofliving.1InJunethe24%Transportgovernmentwonparliamentaryapprovaltobuildnewnuclearplants,40yearsafterthecountryvotedtophasethemout,4%Buildingschangingitsenergytargetfrom100percentrenewableto100percentfossil-free,buttheyremaincontroversial.227%IndustryWestmansaysthataswellassmall-scalenuclear,itwould11%Agriculturemakesenseforthecountrytoconsidercarboncapture,storageandlowerconsumption:“Itisacombinationthatweneed.15%WasteRenewableswillnotbeenough.”Expandingthecountry’selectricitygenerationtolevelssufficienttomeetitsnetzeroSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,targetscouldtake20or30years,headds.h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023Southernpeople,northernenergyMostofSweden’spopulationliveinthesouthofthecountrywhilemuchofenergygenerationpotentialandsomeheavyindustrialemittersarehundredsofkilometerstothenorthacrossruggedterrain,requiringmoregridinfrastructurethatwouldneed©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsandthegovernment’swithdrawalofa‘climatebonus’subsidyChangeinabsoluteemissions(2005–2022)inNovember2022.6Headdsthatcharginginfrastructurewillbeessentialinsustainingadoptionofelectriccarsandtrucks.-26%InMaySwedenannounceditwillinstallpermanent‘dynamic-12%charging’torechargevehiclesinmotionontheE20motorwayby2025,withplanstohave3,000kilometersofroadsimilarly-20%equippedby2045.7-31%-56%Whilemostsectorshaveseensignificantreductionsinemissions-32%intensityoverthelastthreedecades,agriculturehasmadelessprogress.Westmansaysitisaparticularlydifficultactivityto-7%decarbonizegiventhehighcostofnewvehiclesandequipment-1%andalackofcapitalavailabletomanyfarmers,meaningtheytendtokeepoldequipmentinserviceforaslongaspossible.-150%-100%-50%0%50%100%150%1KasiaStrekandJonasEkblom,‘Europe’sgreenrevolutionthreatensindigenousChangeinemissionsintensity(2005–2022)culture’,Bloomberg,26June2023.h­t­t­p­s://w­w­w.bloomberg.com/features/2023-sweden-indigenous-sami-green-energy/-47%2SimonJohnson,‘Swedishparliamentpassesnewenergytarget,easingwayfornew-26%nuclearpower’,Reuters,20June2023.h­t­t­p­s://w­w­w.reuters.com/sustainability/climate-energy/swedish-parliament-passes-new-energy-target-easing-way-new--51%nuclear-power-2023-06-20/-69%3‘Electrictrucks’,ABVolvo.h­t­t­p­s://w­w­w.volvotrucks.com/en-en/trucks/renewable-fuels/electric-trucks.html-37%-12%-29%4‘NorthvoltandScaniaunveilgreenbatterycapableofpoweringtrucksfor1.5millionkilometers’,Northvolt,19April2023.h­t­t­p­s://northvolt.com/articles/northvolt-scania--150%-100%-50%0%50%100%150%cell/EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWaste5‘GlobalEVdataexplorer’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/global-ev-data-explorerSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData6‘Klimatbonusenupphörden8november’(inSwedish),SwedishGovernment,7November2022.h­t­t­p­s://w­w­w.regeringen.se/pressmeddelanden/2022/11/klimatbonusen-upphor-den-8-november/7RoselyneMin,‘Swedenisbuildingtheworld’sfirstpermanentelectrifiedroadforEVstochargewhiledriving’,6July2023,Euronews.h­t­t­p­s://w­w­w.euronews.com/next/2023/05/09/sweden-is-building-the-worlds-first-permanent-electrified-road-for-evs-to-charge-while-dri81NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsSwitzerlandInJune,Swissvotersapprovedthecountry’snewclimateactinsupportchangethegovernmentisprovidingfinancialsupportofareferendum.ThisenshrinesinlawthatSwitzerlandwillreach2billionSwissfrancs(CHF)(US$2.22billion)over10yearstohelpNewclimateactenshrines2050netzeronetzerogreenhouseemissionsby2050andbe‘netnegative’,replacefossilfuelheating.3goalandincludesspecifictargetsforremovingandstoringmoreemissionsthanarereleased,afterthatTheclimateactsetsalessseveretargetforthetransportsectorbuildings,transportandindustrybutexcludesdate.Italsoincludesintermediatetargetsforemissionsincludingofreducingemissionsby57percentby2040comparedwithsupplieremissionsandthefinancialsector.cutsby2040ofatleast75percentcomparedto1990,aswellas1990.SchmuckisaysthisreflectstheeconomicimportanceFrom2024largeSwisscompanieswillhavesector-leveltargetsforbuildings,transportandindustryfor2040oflogisticswithhighvolumesofimports,exportsandgoodstodiscloseclimaterisks,impactsandplans.and2050.ItcallsforallSwisscompaniestoachievenetzerotransitingthecountrybyroadandair.“Itrequiresmoretimesoasby2050onscope1and2emissionsandencouragesthemtonottoharmtheeconomyofSwitzerland,”hesays.developplansforthisbefore2029.1GHGemissionssplitbysector(2022)Whilepassingthelawrepresentsastrengthforthecountryit3%EnergyexcludingelectricityhascertainweaknessesaccordingtoPatrickSchmucki,Director,6%ElectricityFinancialServices,CorporateResponsibilityOfficer,KPMGinSwitzerland.“Scope3emissionsarescopedout,”hesays,33%Transportreferringtothosecausedbysuppliers.Thisissignificantgiventhecountryhasamongtheworld’shighestemissionsperperson25%Buildingswhensupplychainsareincluded,withSwitzerland’semissionsin2020morethantriplingifcarbonemissionsembeddedin20%Industrytradeareincluded.2Theactalsoreliesonconsiderablelevelsofoffsettingandlacksaspecifictargetforthecountry’s12%Agricultureeconomicallyvitalfinancialservicessector,althoughitdoesallow2%Wasteforfurthersectortargetstobeaddedlater.Source:CalculatedbyKPMGInternationalusingdatafromEDGAR,Targetingbuildingsandtransporth­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023Somesectorshavemoredemandingtargetsthanothers,withtheactrequiringthebuildingssectortocutemissionsby82percenton1990levelsby2040.Schmuckisaysthatthecountry’sbuildingstockisalreadyofarelativelyhighqualitycomparedwithothercountriesandthatinstitutionalrealestateinvestorsareengagingwellwithdecarbonizationwork.Buttherearequestionsoverwhetherindividualswhoownbuildingswilldolikewiseandsomeinstitutionshavesoldinefficientbuildingstoprivateinvestors.To82NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsElectricityisastrengthforSwitzerland,givenithasgeneratedChangeinabsoluteemissions(2005–2022)nearlyallofitssupplyfromlowcarbonsourcesforseveraldecadesandhasthelowestcarbonintensityoftheInternational-19%EnergyAgency’smembercountries.4Itreliesonhydroelectric26%andnuclearpower,withfourreactorsstillproducingsignificantamountsofpowerdespitea2017votetodecommission-10%theseovertime.5Thecountryplanstoexpandsolarandwind-10%productionfromtheirpresentlowbase.-38%-15%Thecountrywillsoonrequirelargecompaniestoreportonclimatechangebasedontheinternationalrecommendationsof-5%theTaskForceonClimate-relatedFinancialDisclosures.FromJanuary2024,publiccompanies,banksandinsurancecompanies-150%-100%-50%0%50%100%150%withmorethan500employeesandCHF20millioninassetsorCHF40millioninturnoverwillhavetopublishfinancialrisksfromChangeinemissionsintensity(2005–2022)climate-relatedactivities,theimpactoftheseactivitiesontheclimate,theircorporateemissionreductiontargetsandhowthey-41%plantomeetthem.6-35%-13%1JulianMeitanisandManfrediFiorillo,‘Swisscompaniesneedtodevelopa-55%-9%decarbonizationplan’,KPMGinSwitzerland,22June2023.https://kpmg.com/ch/en/blogs/home/posts/2023/06/swiss-companies-need-develop-decarbonization--39%plan.html-150%-100%-50%0%50%100%150%2‘CO2emissionsembeddedintrade,2020’,OurWorldinData.h­t­t­p­s://ourworldindata.org/grapher/share-co2-embedded-in-tradeEconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWaste3‘Swisscompaniesneedtodevelopadecarbonizationplan’,KPMGinSwitzerlandSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldasabove.Energy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData4‘Switzerland’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/countries/switzerland5SaraIbrahim,‘Nuclearyesornuclearno:wheredoesSwitzerland’senergystrategygo?’,SWI,21May2022.h­t­t­p­s://w­w­w.swissinfo.ch/eng/sci-tech/nuclear-energy-strategy-switzerland-russia-ukraine-electricity-renewables/476101546‘FederalCouncilbringsordinanceonmandatoryclimatedisclosuresforlargecompaniesintoforceasof1January2024’,SwitzerlandFederalOfficefortheEnvironment,23November2022.h­t­t­p­s://w­w­w.bafu.admin.ch/bafu/en/home/documentation/news-releases/anzeige-nsb-unter-medienmitteilungen.msg-id-91859.html83NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsUnitedArabEmiratesTheUnitedArabEmirateshasdemonstratedarenewedIndustrialcirculareconomycommitmenttodecarbonizinginadvanceofhostingthisAmajoroilexporterpushestoannounceNovember’sCOP28UNclimatechangeconference.InJulyIndustrywasresponsiblefor42percentofthecountry’sdecarbonizationstrategiesbeforeithoststheUAEsaiditplanstocutemissionsby40percentfromtheemissionsin2022,includingenergy-intensiveproductiontheCOP28conference,includingtripling1990baselineusedundertheParisAgreement,upfromaofaluminumandsteel.InJune,AbuDhabi,oneoftherenewableenergycapacityby2030,greener31percentcutpreviously,onitswaytonetzeroby2050.ItalsosevenemiratesthatmakeuptheUAE,launchedanindustrialindustryandadoptionofelectricvehicles.announcedatargetofproducing1.4milliontonnesofhydrogenstrategyinvolvinginvestmentof10billionEmiratidirhamsby2031,with1milliontonnesofthisbeinggreenhydrogen(AED)(US$2.72billion)whichincludesenvironmentallyproducedwithrenewableenergy,withthetotalincreasingtofocusedaspects,includingcirculareconomyregulatorywork,15milliontonnesby2050,aswellasatriplingofrenewableenergycapacitybetweennowand2030.1ThecountryhasanGHGemissionssplitbysector(2022)abundanceofsolarenergypotentialwithtwolargesolarparksalreadyinoperation.16%EnergyexcludingelectricityFadiAlShihabi,PartnerandHeadofESGAdvisoryServices,25%ElectricityKPMGLowerGulf,saysthatonpresentdatatheUAEhasworktodooncuttingemissions,butitismakingsignificantchanges.13%Transport“BecauseofCOP28comingup,thereisapushtoannounce0%Buildingsstrategiesandtargetstodecarbonize,”hesays,with“ahugeshiftintoimplementation”likelytofollowinthenextcoupleof42%Industryyears.Thecountry’soilrevenuesprovideitwiththefinancialresourcestofundsuchwork,includinginvestmentsinresearch1%AgricultureanddevelopmentwhichAlShihabithinksarelikelytobecome3%Wasteincreasinglysignificantforthecountry.Source:CalculatedbyKPMGInternationalusingdatafromEDGAR,Itisalsocompletingnewnuclearcapacity,withEmiratesNuclearh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023EnergyCorporationsayinginJunethatthefourthandfinalunitofitsBarakahenergyplantinAbuDhabiisundergoingtestsbeforegoinglive,withtheotherthreeunitsalreadyinservice.Whenfullyoperational,thenuclearplantwillprovidearoundaquarteroftheUAE’selectricityandtheoperatorsaysthatthishasalreadypushedgasdemandinAbuDhabitoan11-yearlow.284NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsprocurementthatconsidersenvironmentalissuesandincentivesOnlyafewthousandelectricvehiclesarecurrentlyonthan1,000by2025.AbuDhabiisexploringhydrogenfuelforimprovingenvironmentalsustainability.3AbuDhabialsotheUAE’sroadsbutthislookssettoincreaserapidlywithforvehiclesanditsnationalenergycompanywantstoinstallmakesuseofnaturalcarbonsequestration,reckoningthatintheemirateofDubai’sGreenMobilityStrategyrequiringmorethan70,000electricchargingpointsacrosstheUAEby2018theequivalentofaround5percentofitscarbonemissions30percentofpublicsectorand10percentofallvehiclesales2030.5EtihadRail,thecountry’srecentlycompletednationalrailwereremovedfromtheatmospherebyplantationsincludingtobeeitherelectricorhybridby2030.Dubaialsoplansforsystem,aimstoreducetheUAE’sannualtransportemissionsforests,mangrovewetlandsandcroplands.4alltaxistobehybridorelectricby2027andithasmorethanby8.2MtCO2ethroughmovingfreightofftheroads.6620electricvehiclechargingstationswithatargetofmore1MahaElDahan,‘UAE’srevisedenergystrategyincludesbighydrogenplans’,Reuters,11July2023.h­t­t­p­s://w­w­w.reuters.com/world/middle-east/uaes-revised-energy-strategy-includes-big-hydrogen-plans-2023-07-11/2‘GreenhousegasinventoryandprojectionsforAbuDhabiemirate’,April2021,AbuDhabiEnvironmentAgency.h­t­t­p­s://w­w­w.ead.gov.ae/-/media/Project/EAD/EAD/Documents/Resources/EAD-GHG-Executive-Summary-Report-EN-final.pdf3‘UnitedArabEmirateselectricvehiclemarket’,USInternationalTradeAdministration.h­t­t­p­s://w­w­w.trade.gov/market-intelligence/united-arab-emirates-electric-vehicle-market4JohnDennehy,‘HowEtihadRail’sfreightserviceaimstocuttraveltimesforUAEmotorists’,TheNationalNews,16May2023.h­t­t­p­s://w­w­w.thenationalnews.com/uae/2023/05/16/how-etihad-rails-freight-service-will-improve-your-commute/5‘GreenhousegasinventoryandprojectionsforAbuDhabiemirate’,April2021,AbuDhabiEnvironmentAgency.h­t­t­p­s://w­w­w.ead.gov.ae/-/media/Project/EAD/EAD/Documents/Resources/EAD-GHG-Executive-Summary-Report-EN-final.pdf6‘FinalunitoftheBarakahplantcommencesoperationalreadinesspreparations’,EmiratesNuclearEnergyCorporation,8June2023.h­t­t­p­s://w­w­w.enec.gov.ae/news/latest-news/final-unit-of-the-barakah-plant-commences-operational-readiness-preparations/85NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)23%41%74%73%-150%-100%-50%0%50%100%139%132%150%Changeinemissionsintensity(2005–2022)2%-6%-45%1%58%36%-150%-100%-50%0%50%Industry100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData86NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsUnitedKingdomTheUnitedKingdomhasrecordedsomemajorInSeptember2023,thegovernmentannounceda“moreachievementsonitsjourneytowardsnetzero.Ithascutpragmatic”approachtoreachingnetzero,delayingabanSuccessesoncuttingtotalemissionsandgreenhousegasemissionsbyalmosthalfsince1990,oneonnewpetrolanddieselcarsfrom2030to2035,thesameexpandingrenewableelectricityproductionofthebestrecordsofanydevelopedcountry,whilegrowingdateastheEU.Italsodelayedbansontheinstallationofarewelcome,buttheUKfacesabigthesizeofitseconomybyaroundtwo-thirds.“Itshowsyounewfossilfuelboilerswhileincreasingcashgrantsforchallengeinmakinghomesmoreenergycandecarbonizewhilestillgrowing,”saysSimonVirley,Vicereplacingsuchboilerswithheatpumpsby50percenttoefficientandconvertingthemfromnaturalChairandHeadofEnergyandNaturalResources,KPMGin7,500Britishpounds(GBP)(US$9,220).3gastolowcarbonformsofheating.theUK.GHGemissionssplitbysector(2022)AbouthalfoftheUK’selectricitynowcomesfromlowcarbonsources,mainlyrenewableswithsomenuclear8%Energyexcludingelectricityenergy.Coalisararelyusedstandbyoptionandrenewable17%Electricitygenerationcontinuestogrowrapidly,shownbytheelectricitysystemoperatorNationalGridregisteringarecord25%TransportlowinGreatBritain’selectricitycarbonintensityof33gCO2eperkilowatthouron10April2023,comparedwithquarterly21%Buildingsaveragesof400-500gCO2efrom2010-14.1TheUKhasalsoledeffortsonrequiringcompaniestoreportonclimaterisks14%Industryandplans,improvingtransparencyandencouragingaction,measuresthatmanyothercountriesareadopting.11%Agriculture3%WasteTheUKnowfacesmajorchallengesonbuildings,industryandsometypesoftransport.“WehavedonetheeasySource:CalculatedbyKPMGInternationalusingdatafromEDGAR,bit,”saysVirley.“Thenextpartmaybealotharder.”Ath­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_20232021’sUK-hostedCOP26climatechangeconferencethegovernmentseta2030targetofcuttingemissionsby68percentcomparedwith1990.InareportthisJune,theindependentClimateChangeCommitteesaidthattheannualrateofreductionoutsideelectricitywilllikelyneedtoquadrupletohitthis,addingitwasmarkedlylessconfidentthetargetwillbereachedthanayearago.287NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsInefficientgas-heatedhomesthecasewithmanyincludingnaturalgasboilersdespiteaManyUK-basedindustrialemittersareinterestedinusingforthcomingbanontheseinnewhomes.greenhydrogenasaroutetodecarbonization,butalackofTheUKhassomeoftheleastenergyefficienthomesinEurope4clarityfromgovernmentoversubsidiesandwheresuppliesandaroundfour-fifthsareheatedwithnaturalgas.TotackleVirleysaysthattheUKgovernmenthasnotrampedupofhydrogenwillcomefromisholdingbackprogress.Therethelatterthegovernmentwantstosee600,000electricallyeffortsonenergyefficiencytonearlythesameextentasaresignificantchallengesinthetransportsector,suchaspoweredheatpumpsinstalledannuallyby2028,butthemostotherEuropeancountriesinresponsetotheUkraineoverhowaviationandinternationalshippingcanswitchtoClimateChangeCommitteesaysthecurrentrateisaboutone-war.Theprivatesectorcouldplayasignificantroleinlowcarbonfuels,butmoreencouragingly23percentofninthofthiswhileimplementationofotherenergyefficiencyhousing’sdecarbonizationbymakingiteasierforownerstocarssoldintheUKin2022wereelectricpowered.6Usingmeasurescontinuedtofallin2022.TheUK’shousingstockinstallheatpumpsandinsulation,offeringlong-termloanssuchvehiclescanencouragepeopletothinkmorebroadlyincludesmanypoorlyinsulateddecades-oldterracesaswellastopayforthisandsupportinganationalawarenessandabouttheirpowerconsumptionandconsidertariffsthattowerblocks,bothofwhichcouldpresentchallengesforheatengagementprogramthatincludespersonalizedadviceandoffercheaperelectricitywhendemandislower,Virleysays:pumpinstallation.Withnewhomes,LauraForzani,ESGChiefeasiercustomerprocesses.5“Ithinkthetake-upofEVshasthepotentialtochangetheOperatingOfficer,KPMGintheUK,saysthatdecarbonizationpublic’srelationshipwithenergy.”shouldbeembeddedintheplanningbutthisisoftennot1NationalGridESO,‘We’vedoublecheckedthedata...’,Twitter,14April2023.h­t­t­p­s://twitter.com/NationalGridESO/status/1646856505872769025NationalGridESO,HistoricGBGenerationMixdatafor2010-2014.h­t­t­p­s://data.nationalgrideso.com/carbon-intensity1/historic-generation-mix/r/historic_gb_generation_mix2‘Bettertransparencyisnosubstituteforrealdelivery’,UKClimateChangeCommittee,28June2023.h­t­t­p­s://w­w­w.theccc.org.uk/2023/06/28/better-transparency-is-no-substitute-for-real-delivery/3‘PMrecommitsUKtoNetZeroby2050andpledgesa“fairer”pathtoachievingtargettoeasethefinancialburdenonBritishfamilies’,UKPrimeMinister’sOffice,20September2023.h­t­t­p­s://w­w­w.gov.uk/government/news/pm-recommits-uk-to-net-zero-by-2050-and-pledges-a-fairer-path-to-achieving-target-to-ease-the-financial-burden-on-british-families4SimonLevey,JezFredenburghandCarolineBrogan,‘UKbehindEuropeancountriesonhomeupgradestocombatbillsandclimatecrisis’,ImperialCollegeLondon,14December2022.h­t­t­p­s://w­w­w.imperial.ac.uk/news/242271/uk-behind-european-countries-home-upgrades/5‘Homeiswheretheheatis’,SustainableHomesandBuildingsCoalitionwithKPMGintheUK,21October2021.h­t­t­p­s://w­w­w.natwestgroup.com/news-and-insights/news-room/press-releases/climate/2021/oct/home-is-where-the-heat-is.html6‘GlobalEVdataexplorer’,InternationalEnergyAgency.h­t­t­p­s://w­w­w.iea.org/data-and-statistics/data-tools/global-ev-data-explorer88NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-37%-46%-64%-16%-36%-15%-5%-64%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)-49%38%-55%-31%-30%-40%-14%-70%-150%-100%-50%0%50%100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData89NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsUnitedStatesofAmericaTheUnitedStateshasanabundanceofrenewableenergyReducingwaste,decarbonizingsupplierspotential,includingfromsolar,wind,geothermalandWithastrongrecordforinnovation,theUShydropower.2022markedthefirstyearthatelectricityfromTheInflationReductionActencouragesmanufacturerstoiswell-positionedtoleadthetransitiontoarenewablesexceededcoalwith21percentofproductiongofurtheronreducingwaste,suchascirculareconomylow-carboneconomybutmanyfactorshangfromtheformerand20percentfromthelatteraccordingeffortstofindotherusesformaterialsthatwouldotherwiseinthebalance.totheUSEnergyInformationAdministration.Naturalgasbediscarded,whichreducesemissionsaswellashavingremainedthelargestsourcewith39percent.1Withastrongotherenvironmentalbenefits.Fishersaysthatanumberofrecordforinnovation,theUSiswell-positionedtoleadthelargeUS-headquarteredcompaniesarealsoincreasinglytransitiontoalow-carboneconomybutmanyfactorshanginrequiringthattheirsuppliersimprovetheirenvironmentalthebalance.performance,helpingtodecarbonizewholevaluechains.InAugust2022,PresidentJoeBidensignedintolawtheGHGemissionssplitbysector(2022)InflationReductionAct,whichcontainsmajortaxincentivesandbenefitsforworkfocusedondecarbonization.2“We10%Energyexcludingelectricityhaveconsistentlydecarbonizedandreducedouremissionsintensity,butemissionsintensityisstillhighcomparedto27%Electricityanumberofothereconomies,”saysRobFisher,USESGLeadandPartner,KPMGintheUSofthetrendoverthelast29%Transportfewdecades.TheInflationReductionActandincreasinginvestordemandsarelikelytoleadtoafurtherreductionin10%Buildingsemissions,withananalysisfromtheNationalRenewable14%IndustryEnergyLaboratorypredictingthatthelegislationwillhelptheUSgettoaround80percentcleanelectricityby2030.37%Agriculture3%WasteNewclimatedisclosurerulesfromtheSecuritiesandExchangeCommissionexpectedduring2023shouldfurtherSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,supportinvestmentsbyprovidingmoreinformationandh­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023greatertransparencyforinvestors,Fisheradds.Howevertheshifttorenewables,whichproduceelectricityintermittentlycomparedwithfossilfuelsandnuclear,andincreasingdemandstorechargeelectricvehicleswillrequireincreasinginvestmentinUSelectricitygridinfrastructure.90NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsForexample,technologygiantMicrosoftrequiresitsInflationReductionActhashelpedmakethenear-terminApril2023foundthat59percentofcorporateinvestorssupplierstocommittoreducinggreenhousegasemissionseconomicsofinvestingindecarbonizationmoreviableandhavehaddealscanceledduetomaterialfindingsfromdueby55percentby2030unlessotherwiseagreed,withfinanciallyattractive.diligencerelatedtoESGreporting,while46percentofsupportforsomesuppliersindevelopingcountriestofinancialinvestorshadadealcanceledoroptedforapricedecarbonizethroughassistanceandfinancing.ThecompanyKPMGintheUShasseendealmakerssuchasprivateequityreductionafteramaterialESGduediligencefinding.6isaimingtobecomecarbonnegativeby2030andsaysthatfirmsplacingincreasingweightonsustainabilitywhenscope3emissionsincludingthosefromsuppliersmakeupundertakingduediligencework.RecentmarketturmoilhasFishernotesthatwhenitcomestosustainableconsumerthemajorityofitsoverallemissions.4ledtovolumesofdealsfallingsharply,withglobalmergersproducts,itisimportanttomeetpeoplewheretheyare.Forandacquisitionsactivityinthesecondquarterofthisyearexample,inflation-pinchedAmericanhouseholdsmaynotFisheraddsthatintheUSitisparamountthatESGstrategies36percentlowerthanthesameperiodin2022accordingalwaysbewillingtobuytheproductwiththeleastamountandprogramsenhancefinancialvalueortheywillnotbetoresearcherDealogic.5Asdeallevelsbouncebackandofemissionsassociatedwithitifitmeansasignificantpricesustainableaseitheracompanywouldlosemarketshareorwithsustainabilitynowbuiltintoduediligenceprocesses,increase.Asmoreconsumer-facingcompaniescontinuetotheprogramswouldbecutasorganizationstightentheirbeltsacompany’sabilitytotellitsowndata-drivensustainabilityembedsustainabilityintotheirprocesses,thereshouldbethroughdifferenteconomiccycles.TheUS$370billionstorycanmeanahighervaluationorthedifferencebetweenlessofapremiumonsustainableproductsastheybecomeallocatedtoenergysecurityandclimateprogramsinthewhetherornotadealcloses.AKPMGsurveyconductedthebaselinemarketexpectation.1IsabellaO’Malley,‘USrenewableelectricitysurpassedcoalin2022’,AssociatedPress,28March2023.h­t­t­p­s://apnews.com/article/renewable-energy-coal-nuclear-climate-change-dd4a0b168fe057f430e37398615155a02‘InflationReductionActchangesthegameforenergytransformation’,PluggedInmagazine,KPMGInternational,March2023.https://kpmg.com/xx/en/home/industries/energy/power-utilities/plugged-in-magazine-2/inflation-reduction-act-changes-the-game-for-energy-transformation.html3EllaNilsen,‘CanBidenachievehiscornerstoneclimategoal?Why100%cleanpowerisstilloutofreach’,CNN,14July2023.h­t­t­p­s://edition.cnn.com/2023/07/14/politics/biden-clean-electricity-goal-report-card-climate/index.html4FAQsonenvironmentalprotection,‘LearnaboutyourresponsibilitiesasaMicrosoftsupplier’,Microsoft.h­t­t­p­s://w­w­w.microsoft.com/en-us/procurement/supplier-conduct.aspx?activetab=pivot:primaryr115AnirbanSenandAndresGonzalez,‘Globalmergersandacquisitionsplungeinsecondquarter,dealmakersseegreenshoots’,Reuters,30June2023.h­t­t­p­s://w­w­w.reuters.com/markets/deals/global-mergers-acquisitions-plunge-q2-dealmakers-see-green-shoots-2023-06-30/6‘KPMGstudy:mostUSinvestorswantadedicatedESGduediligenceproductthatcananalyzerisksandopportunities’,KPMGintheUS,27July2023.https://info.kpmg.us/news-perspectives/industry-insights-research/kpmg-esg-due-diligence-survey-2023.html91NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCCoouunnttryprrooffiilleessAboutKPMGESGKPMGcontactsChangeinabsoluteemissions(2005–2022)-15%-3%-36%-5%-7%-2%5%-150%-100%-50%0%50%100%150%Changeinemissionsintensity(2005–2022)-37%-34%-39%-30%-30%-13%0%-150%-100%-50%0%50%100%150%EconomyEnergyexcludingelectricityElectricityTransportBuildingsIndustryAgricultureWasteSource:CalculatedbyKPMGInternationalusingdatafromEDGAR,h­t­t­p­s­:­/­/­edgar.jrc.ec.europa.eu/report_2023;EnergyInstitute’s2023StatisticalReviewofWorldEnergy,h­t­t­p­s­:­/­/­w­w­w­.energyinst.org/statistical-review;EconomistIntelligenceUnit(EIU)Viewpoint;TheWorldBankOpenData92NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsAboutKPMG‘sdecarbonization,climateandnatureservicesBusinesscommitmentstoreachnetzeroemissionsandLearnmoreSubscribetodaytoreceivethelatestreducetheirimpactsontheplanethaveincreasedrapidly.ESG-relatedcontentstraighttoyourinbox.AstheglobalpushtowardsdecarbonizationacceleratesandKPMG,asaglobalorganization,theimpactsofclimatechangeplayoutglobally,businessesknowstheintrinsicpowerofESGtoKPMGESGinsightsarepreparingforalow-carbonfuture—risingtostakeholdertransformyourbusiness.KPMGESGdemandsforaccountabilityonplans,actionandprogress.​professionalscanshowyouhowtoFormoreinformationabouthowyoucanhelpenhancetrust,mitigateriskandunlockyourorganizationinachievingitsESGgoals,StrongdecarbonizationtargetsandrobusttransitionplanstonewvalueasyoutransformtobuildacheckoutandsubscribetoESGinsights,decarbonizebusinessoperationsandsupplychains,togethersustainablefuture.whichisanongoingsubscriptionthatallowswithtargetsandactionstoreduceimpactsonnature,arenowyoutoreceivearticles,publications,webcastsexpected.BoardsareundersignificantpressuretoaddressVisitkpmg.com/esgtoexploremore.andpodcastscuratedforESGleaders.environmentalissues,anditiscriticalthatbusinessesgraspthekpmg.com/esgimplicationsofclimateandnaturerisksandopportunities.​kpmg.com/esginsightsKPMGdecarbonization,climateandnatureteamsformanextensiveglobalnetworkofdeepexpertise,establishedservices,innovativetechnologiesandcarefullyselectedalliances,spanning:​•Climateandnaturerisk​•Decarbonizationstrategyandimplementation​•Climatepolicyandincentivesadvisory​•Lowcarbondealadvisory​KPMGprofessionalscanhelpnavigatethisincreasinglycomplexlandscape,enablingyoutodeliveronyourenvironmentalambitionsforyourbusiness,peopleandtheplanet.​93NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.QuickreaderguideForewordKeyinsightsandobservationsGlobalsectorsummariesCountryprofilesAboutKPMGESGKPMGcontactsKPMGcontactsDirector,GlobalStrategyGroupAustraliaIrelandSouthAfricaChristopherBrownBarrySterlandRussellSmythRonStuartClimateChangeandE:christopher.brown@kpmg.ieE:bsterland@kpmg.com.auE:russell.smyth@kpmg.ieE:ron.stuart@kpmg.co.zaDecarbonizationLeader,GlobalHeadofRenewableEnergyMajorprojectsadvisoryBrazilItalySouthKoreaMikeHayesLisaKelveyFelipeSalgadoPierMarioBarzaghiDianaAhRyungLeeE:mike.hayes@kpmg.ieE:lisa.kelvey@kpmg.co.ukE:felipesalgado@kpmg.com.brE:pbarzaghi@kpmg.itE:ahryunglee@kr.kpmg.comGlobalManagingDirectorGlobalHeadofIndustrialCanadaJapanSpainDavidGreenallManufacturingAndrewMcHardyAyakoToriiRamonPueyoViñualesE:dgreenall@kpmg.caStéphaneSouchetE:amchardy@kpmg.caE:ayako.torii@jp.kpmg.comE:rpueyo@kpmg.esE:ssouchet@kpmg.frGlobalHeadofTransport&ChinaMexicoSwedenLogisticsSeniorTaxManager—DaisyShenAliciaMorenoTorbjörnWestmanSteffenWagnerGlobalESGTaxE:daisy.shen@kpmg.comE:aliciamoreno@kpmg.com.mxE:torbjorn.westman@kpmg.seE:steffenwagner@kpmg.comNicoledeJagerE:dejager.nicole@kpmg.comDenmarkNetherlandsSwitzerlandGlobalHeadofEnergy,NaturalMichaelBirkebækJensenBobHoogendoornPatrickSchmuckiResourcesandChemicalsGlobalHeadofESGReportingE:mijensen@kpmg.comE:hoogendoorn.bob@kpmg.nlE:pschmucki@kpmg.comAnishDeJan-HendrikGnändigerE:anishde@kpmg.comE:jgnaendiger@kpmg.comFranceNewZealandUnitedArabEmiratesJeremieJoosCharlesEhrhartFadiAlShihabiChiefEconomistGlobalHeadofESGAssuranceE:jeremiejoos@kpmg.frE:cehrhart@kpmg.co.nzE:falshihabi@kpmg.comYaelSelfinMikeShannonE:yael.selfin@kpmg.co.ukE:mshannon@kpmg.comGermanyNorwayAmroOsmanGoranMazarCarlChristianChristensenE:aosman2@kpmg.comGlobalHeadofOil&GasGlobalHeadofAgribusinessE:gmazar@kpmg.comE:carl.christian.christensen@kpmg.noJonathanPeacockIanProudfootUnitedKingdomE:jjpeacock@kpmg.com.auE:iproudfoot@kpmg.co.nzIndiaSingaporeRichardAndrewsAnishDeSharadSomaniE:richard.andrews@kpmg.co.ukGlobalHeadofShippingE:anishde@kpmg.comE:sharadsomani@kpmg.com.sgMoniqueGieseUnitedStatesofAmericaE:moniquegiese@kpmg.comApurbaMitraRobFisherE:apurbamitra@kpmg.comE:rpfisher@kpmg.com94NetZeroReadinessReport2023©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.kpmg.com/esgTheinformationcontainedhereinisofageneralnatureandisnotintendedtoaddressthecircumstancesofanyparticularindividualorentity.Althoughweendeavortoprovideaccurateandtimelyinformation,therecanbenoguaranteethatsuchinformationisaccurateasofthedateitisreceivedorthatitwillcontinuetobeaccurateinthefuture.Nooneshouldactonsuchinformationwithoutappropriateprofessionaladviceafterathoroughexaminationoftheparticularsituation.Throughoutthisdocument,“we”,“KPMG”,“us”and“our”referstotheglobalorganizationortooneormoreofthememberfirmsofKPMGInternationalLimited(“KPMGInternational”),eachofwhichisaseparatelegalentity.©2023CopyrightownedbyoneormoreoftheKPMGInternationalentities.KPMGInternationalentitiesprovidenoservicestoclients.Allrightsreserved.KPMGreferstotheglobalorganizationortooneormoreofthememberfirmsofKPMGInternationalLimited(“KPMGInternational”),eachofwhichisaseparatelegalentity.KPMGInternationalLimitedisaprivateEnglishcompanylimitedbyguaranteeanddoesnotprovideservicestoclients.Formoredetailaboutourstructurepleasevisitkpmg.com/governance.TheKPMGnameandlogoaretrademarksusedunderlicensebytheindependentmemberfirmsoftheKPMGglobalorganization.DesignedbyEvalueserve.Publicationname:NetZeroReadinessReport2023Publicationnumber:139001-GPublicationdate:November2023