AES Announces Carbon Intensity Reduction of 70 Percent by 2030; Publishes Climate Scenario Report
First U.S.-based energy company to issue report adopting the Task Force on Climate-related Financial Disclosures' (TCFD) recommendations
November 14, 2018 -- The AES Corporation recently (11/13) announced a goal to reduce its carbon intensity by 70 percent by 2030 as a result of its stated renewable growth plans. The new goal, measured in tons of carbon dioxide per megawatt-hour from a 2016 baseline is an improvement on its prior goal of a 50 percent reduction over the same time period.
The company also published the AES Climate Scenario Report, which includes an impact analysis of a 2° Celsius scenario on the company's strategy and business, fulfilling its April 2018 commitment to adopt the recommendations of the TCFD. AES is the first publicly-traded owner of utilities and power companies based in the U.S. to disclose its portfolio's resilience consistent with the TCFD recommendations and third-party scenarios. The report shows AES' portfolio is resilient against the assessed climate scenarios and demonstrates significant upside for the company in a lower carbon future.
'We are pleased to be the first publicly-traded U.S.-based energy company to issue a report adopting the TCFD recommendations,' said Andrés Gluski, AES President and Chief Executive Officer. 'We are even more pleased to see that the results show our actions make us a more resilient company across various climate scenarios. Working with our customers, we are helping the world transition to a lower carbon energy future by accelerating the acceptance and use of energy storage, energy management and renewables, and extending the use of natural gas to provide a cleaner alternative to other fossil fuels. As a result, we believe AES is climate transition-ready.'
AES' clean energy growth platforms of renewable energy, energy storage, LNG and smart, efficient grids position the Company for continued growth across multiple scenarios modeled in the Report. Through 2020, AES expects to add two to three gigawatts of new capacity in renewables annually. These growth expectations are bolstered by AES' recently introduced green blend and extend offering, which systematically replaces coal with lower cost renewables over time. The win-win offering accelerates access to low-cost solar and wind for existing customers, while maintaining the reliability offered by the thermal assets.
AES used TCFD recommendations for multiple scenarios to conduct its analysis, incorporating third-party inputs from the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC), including the 1.5-2° Celsius scenario outlined in the Paris Agreement. The Company is among the first to include these widely-accepted inputs in its analysis, which makes it easier for investors to evaluate and compare companies.
The resulting analysis highlighted the resiliency of AES' strategy across all assessed scenarios based on the actions the Company has taken to date and continues to take to shift its portfolio to long-term contracts and clean energy solutions.