HSBC sets new net zero aligned targets to reduce emissions from oil and gas sectors

HSBC has committed to working with clients to develop valid, science-based transition plans to understand how it will move to net zero by 2050.

As part of this process, HSBC has announced how it intends to realign its portfolio within two emissions intensive sectors: Oil and Gas, and Power and Utilities.

Reducing the greenhouse gas emissions of these sectors is critical to achieving an effective transition.

HSBC is targeting a reduction of 34% in absolute on-balance sheet financed emissions by 2030 for the Oil and Gas sector. HSBC’s on-balance sheet financed emissions for Oil and Gas in 2019 were 35.8 million tonnes of carbon dioxide equivalent (‘Mt CO2e’). This target is equal to the percent reduction that the IEA indicates in its scenario for global sector emissions to 2030 from a 2019 baseline.

For the Power and Utilities sector, HSBC is targeting on-balance sheet financed emissions intensity of 0.14 million tonnes of carbon dioxide equivalent per terawatt hour (‘Mt CO2e/TWh’) by 2030, which would constitute a 75% reduction from its 2019 baseline. This target covers upstream industries such as power generation, with scopes 1 and 2 emissions included.

Noel Quinn, HSBC Group Chief Executive commented: “Partnering and engaging with customers in the transition to net zero is at the heart of our approach. We are supporting clients to evolve their business models and replace old technology with new, greener alternatives. We will request and review science-based client transition plans and use them as the basis for further engagement.”

Dr Celine Herweijer, Group Chief Sustainability Officer, added: “The science is clear that global emissions must significantly reduce this decade to limit global warming to 1.5 degrees. Our interim targets for these high emissions sectors will be embedded into business decision-making.”

This marks the first time HSBC is disclosing its financed emissions, fulfilling its Partnership for Carbon Accounting Financials (PCAF) requirements.

The targets are set as part of the commitment in the climate change resolution passed at the bank’s AGM in May 2021.

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