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In order to slow down the rate of global warming and limit the damage caused by climate change, the United Nations Intergovernmental Panel on Climate Change (UN IPCC) published a report in 2018 recommending a 45 per cent reduction in greenhouse gases between 2010 and 2030 and a complete reduction to zero by 2045 (Germany). This should limit the temperature increase to 1.5 degrees Celsius. At the international climate conference COP26 in Glasgow in 2021, 153 countries therefore set binding emissions targets - the net-zero agreement adopted in this context was intended to cover more than 90 per cent of global economic output and global emissions.

The KPMG Net Zero Readiness Report (NZRR) shows for 24 countries and a number of economic sectors what has been achieved over the past two years with regard to the agreed targets and what concrete efforts companies and countries have made so far to limit the global temperature rise to 1.5 degrees Celsius this century.

The report is based on the key indicators of the economy as a whole, electricity, transport, buildings, industry and agriculture as well as land use change and forestry.

Data visualisations show the trend in CO2 emissions

An individual profile was created for each country. This contains data visualisations that compare emissions by sector and show graphically how these have changed over time. This shows the gap between the current status of countries and their current net zero commitments and the global 1.5 degree Celsius target.

The report also analyses global trends in sectors that are key to tackling climate change, such as the sale of electric vehicles.

Countries analysed

The findings are based on interviews conducted by national KPMG experts on climate change issues with company representatives in the 24 countries analysed. These are: Australia, Brazil, Canada, China, Denmark, France, Germany, India, Ireland, Italy, Japan, Mexico, the Netherlands, New Zealand, Norway, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, the United Arab Emirates, the United Kingdom and the United States.

Measures to reduce CO2

In the meantime, many countries have taken the right and important steps to reduce greenhouse gases. On the one hand, legislative measures have been introduced, such as the Corporate Sustainability Reporting Directive (CSRD) and the EU Carbon Border Adjustment Mechanism (CBAM), to provide a clear framework.

On the other hand, several billion-euro support programmes have been launched, such as the EU's Green Deal and the Inflation Reduction Act in the USA. These programmes are intended to support the economy on the path to net zero.

Faster to net zero

Despite these measures, however, it must be recognised that there is still a long way to go for many countries to achieve climate neutrality: for example, some energy companies and fund managers have only recently backed away from their net zero commitments. This report aims to help countries and organisations accelerate their pace on the long road to net zero.

The most important findings from the Net Zero Readiness Report:

  1. Several of the world's largest emitting countries have stepped up their net zero ambitions, including the US, China, Australia, Canada, Brazil and members of the European Union.

  2. Net zero measures are now an integral part of global economic systems, for example through emissions trading schemes, carbon border adjustment mechanisms and climate reporting.

  3. The availability of low-emission energy is growing rapidly. Offshore wind energy, solar energy and nuclear energy are making a significant contribution to this.

  4. The share of electric vehicles in all car sales tripled between 2020 and 2022. This development shows that the decarbonisation of entire industries is possible.

  5. The implementation of renewable energy projects often meets with resistance, for example because of fears of negative impacts on the local environment, wildlife, biodiversity and population. This leads to "green versus green" conflicts.

  6. Net zero targets come under pressure when the negative consequences (costs and bans) come to the fore. Current examples are the switch to sustainable forms of heating in private households and the discussions about a more ecological, sustainable agriculture.