We are speeding up our journey to net-zero emissions by introducing a triple-digit real carbon price
Last year, we committed ourselves to achieving net-zero emissions in our operations as early as 2030. We are now taking important next steps.
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To limit global warming to well below 2°C – in accordance with the Paris Agreement – climate science predicts the need for billions of tonnes of negative emissions both before and after 2050. Unprecedented emission reduction efforts will need to be complemented by the rapid scale-up of carbon removal capacities. Since carbon removal is still a nascent industry, this new way of emissions compensation comes at a price. With our new carbon levy we are securing the funds that are required to purchase removal certificates from impactful, durable and scalable carbon removal projects.
Starting in January next year, Swiss Re will increase its internal carbon price from USD 8 as it is today to USD 100 per tonne of CO2. Swiss Re is the first multinational company to announce a triple-digit real carbon levy on both direct and indirect operational emissions (such as business travel). The levy will gradually increase to USD 200 per tonne CO2 by 2030.
In the fight against climate change, an internal carbon price is an important tool to incentivise low-carbon behaviour and decision-making. Ambitious reduction targets are another important tool: In addition to introducing the new levy, we have committed to reducing emissions from air travel by 30% in 2021, relative to the 2018 benchmark.
Read our news release.announcing these new measures.
Swiss Re's net-zero journey will not stop in 2030. We have also signed the UN Global Compact Business Ambition for 1.5°C pledge and are a founding partner of the UN-convened Net-Zero Asset Owner Alliance. This commits us to achieving net-zero emissions by 2050 on the liability and asset side of our balance sheet. Or in other words: We have set out to fully decarbonise our business model.
In our latest SONAR Report, we have laid out the road map to net-zero emissions and taken a detailed look at the carbon removal industry. As a starting point, all sectors of the economy need to reduce emissions as much as possible, in particular the transport, agriculture and building industries. All remaining greenhouse gases will need to be removed from the atmosphere through biological or technical means and then be permanently stored.
The video below explains the net-zero concept and the rationale for making this a pivotal part of our Group Sustainability Strategy.