SBTi Launches Chemicals Sector Consultation to Set 1.5C Emissions Pathways

The Science Based Targets initiative opened a public consultation and expert advisory call to develop sector-specific GHG reduction guidance for the chemicals industry. The consultation ran from 15 May to 15 July 2024, with the chemicals sector identified as the largest industrial energy consumer and third-highest CO2 emitter globally.

SBTi's draft Chemicals Sector Guidance proposes three decarbonisation pathways for primary chemicals — ammonia, methanol, and high-value chemicals (HVC) comprising ethylene, propylene, benzene, toluene and xylene. These primary chemicals account for approximately 70% of direct emissions from the chemicals industry. The SBTi also sought to expand its Expert Advisory Group, inviting expressions of interest from professionals in corporates, finance, academia, government and civil society by 5 June 2024.

The chemicals sector faces mounting climate exposure alongside its emissions profile. Nearly one-third of chemical facilities in the United States are at risk from climate-induced weather events including fire, floods, and accelerated corrosion. For India, which hosts a substantial chemicals manufacturing base, sector-specific SBTi guidance could shape decarbonisation planning and inform access to green financing as companies face growing ESG scrutiny from institutional investors.

Following the public consultation period, all feedback will be reviewed and incorporated before a second consultation phase. The SBTi will also issue a separate call for companies to voluntarily pilot the draft Chemicals Sector Guidance during implementation testing. The full standard development process, including Technical Council review and Board of Trustees adoption, must be completed before the guidance becomes operative. The SBTi stated the sector's economic competitiveness depends on aligning with climate targets.

Key figure — 70% of direct chemical industry emissions come from primary chemicals covered by the guidance