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Pathways performance dashboard.
Energy sector.
Transport sector.
Manufacturing sector.
Buildings sector.
Large Institutional Agribusiness Customers.
Total lending portfolio.
Appendix.
Assurance opinion.
ANZ 2023 Climate-related Financial Disclosures 64
0.70 0.60 0.30 0.20 0.40 0.50 0.10 0.
IEA Net Zero Emissions 2050 Pathway (2021) 2030 Target Pathway (-20%) Actual Performance Against our Target.
ANZ vs. pathway -2.8% t.
Global Average IEA Tracking Report 22 2050 2022 2024 2026 2028 2032 2034 2036 2038 2030 2042 2044 2046 2048 2040 2021 2023 2025 2027 2029 2033 2035 2037 2039 2031 2043 2045 2047 2049 2041.
GHG Intensity (tCO2-e/t Cement)
Graph 6.1: Cement.
Cement Metrics Summary.
Metric 2021 2022 2023.
Emissions Intensity tCO₂-e/t cement 0.61 0.58 0.57.
Absolute Financed Emissions MtCO₂-e 2.161 1.652 1.19.
Portfolio-wide Intensity kgCO₂-e/$ lent 5.223 4.984 3.84.
Data Quality Score5 1.87 1.76 1.98.
Current EAD $bn (% of Group EAD) 0.31 (0.03%) 1. This is a restatement of the 2021 Absolute Financed Emissions we reported in 2022 of 2.24 MtCO₂-e. 2. This is a restatement of the 2022 Absolute Financed Emissions we reported in 2022 of 1.64 MtCO₂-e. 3. This is a restatement of the 2021 Portfolio-wide Intensity we repor...
The key design choices we used in calculating our emissions intensity reduction target for our cement production financing activities are summarised in Table 6 below.
Table 6 – Key design choices in calculating 2030 cement financed emissions target 2030 Target • 20% reduction in emissions intensity from 2021 baseline.
ANZ Customers Included • Companies that own or operate one or more cement plants that manufacture cement from raw inputs6 • Customers above are included where ANZ’s exposure is at least $1 million.
Emissions Included • Scope 1 & 2 emissions7.
Metric • Emissions intensity of cement production (tCO₂-e/t cement)
Financing Activities Included • Exposure at default. This represents the Group's exposure to each sector based on APRA’s calculation formula which includes total committed loans (drawn plus a proportion of off-balance sheet exposures as specified by APRA)
Attribution Approach • Portfolio-weighted approach (measures ANZ’s financing to customers relative to ANZ’s total financing to the cement sector)
Benchmarking Scenario • International Energy Agency (IEA) Net Zero Emissions by 2050 Scenario (2021)
Key External Data Sources • Customer disclosures • Asset Resolution • International Energy Agency.
Cement.
The information in this section should be read together with our disclaimer and important notices available here and our Financed Emissions Methodology available here.
Overview.
Governance.
Strategy.
Risk Management.
Metrics and Targets.
Sectoral metrics and targets.
Sector exposures.
Our approach to sectoral pathways.
Pathways performance dashboard.
Energy sector.
Transport sector.
Manufacturing sector.
Buildings sector.
Large Institutional Agribusiness Customers.
Total lending portfolio.
Appendix.
Assurance opinion.
ANZ 2023 Climate-related Financial Disclosures 65
Performance against target 0.70.
ANZ 2021 ANZ 2022 Portfolio Change1 Customers' Climate Performance.
ANZ 2023 ANZ 2030 target 0.60 0.50 0.40 0.20 0.30 0.10 0
0.61 0.58 0.01 (0.02) 0.57 0.49.
Increase Decrease Total.
GHG Intensity (tCO2-e/t Cement)
Graph 6.2 – Cement portfolio emissions intensity movements 1. Includes changes in exposure as well as APRA's new regulatory capital framework for Australian banks effective from 1 January 2023. This resulted in changes in the credit risk capital that ANZ is required to set aside in respect of different products and as ...
Our 2021 portfolio baseline of 0.61 tCO₂-e/t cement was marginally above the 2021 global average of 0.59 tCO₂-e/t cement.1.
Graph 6.1 shows the emissions intensity of our cement production portfolio has reduced by 7% to 0.57 tCO₂-e/t cement from our 2021 baseline. The limited availability of cost-effective technologies to reduce the hard-to-abate process emissions of cement production makes the pathway towards our target less clear in compa...
Graph 6.2 highlights the reduction in emissions intensity was mainly driven by portfolio change.
Our absolute financed emissions and Portfolio-wide Intensity have decreased year-on-year, in line with a reduction in exposure to the sector.
Actions to achieve 2030 target.
A small number of customers (less than 10) make up a material portion of our exposure to this sector. As our emissions intensity target is based on a portfolio-weighted metric, we intend to prioritise financing projects and customers producing cement at an average intensity below our 2021 baseline portfolio average of ...
We have begun, and will continue, to engage with customers to understand their transition plans, emissions reduction targets and how we can assist in supporting these customers toward lower emissions cement production.
Opportunities for emissions reduction and challenges.
The global cement industry accounts for between 5% and 8% of total global emissions.2.
The overall global demand profile for cement under the 2023 update of the IEA’s NZE 2050 scenario remains relatively flat;3 however, the demand profile differs between developed and developing countries.
While the cement sector faces pressure to reduce emissions, this poses a challenge. The key raw material for cement is limestone, which releases carbon dioxide as it is heated to produce clinker. These production emissions account for approximately 55% of the emissions from cement production.4.
Opportunities for emissions reduction5 in this sector include: • substituting clinker for supplementary cementitious materials (e.g. fly ash, granulated slag, limestone, and calcined clay);6 • alternate fuels for kilns (e.g. biomass instead of fossil fuels); • decarbonisation of electricity; and • plant and end-user ef...
The cement industry will rely on carbon capture and utilisation/storage (CCUS) technologies becoming commercially and technically viable to capture the remaining ‘hard-to-abate’ emissions from the chemical reaction of heating limestone to achieve net zero by 2050 for the industry.7.
It is estimated that capital spending will need to almost double for the sector to reach net-zero emissions by 2050.8 Cement kilns have long average lifetimes (around 40 years). ANZ continues to engage with customers on how we may be able to support their decarbonisation.
1. International Energy Agency – NZE 2050 Tracking Report, July 2023. 2. Global Cement and Concrete Association – Key Facts. 3. International Energy Agency – Net Zero Roadmap, 2023. 4. Decarbonisation Pathways for the Australian Cement and Concrete Sector, 2022. 5. Global Cement and Concrete Association. 6. Fly ash is ...
Cementitious product.
In line with the 2022 SBTi Cement Guidance and our understanding of industry practices, when we refer to our intensity target in tCO₂-e/t cement, we have set an intensity target per tonne of ‘cementitious product’ rather than per tonne of ‘cement’.
This delineation is important as clinker substitutes – such as gypsum, limestone and cement kiln dust – are an important way to help decarbonise the cement sector. ‘Cementitious product’ consists of all clinker produced by our customers for sale, plus all clinker substitutes consumed for blending, plus all cement subst...
CEMENT (CONTINUED)
Overview.
Governance.
Strategy.
Risk Management.
Metrics and Targets.
Sectoral metrics and targets.
Sector exposures.
Our approach to sectoral pathways.
Pathways performance dashboard.
Energy sector.
Transport sector.
Manufacturing sector.
Buildings sector.
Large Institutional Agribusiness Customers.
Total lending portfolio.
Appendix.
Assurance opinion.
ANZ 2023 Climate-related Financial Disclosures 66