Title : Environmental governance and ESG alignment in the petroleum sector: Advancing net-zero strategies through carbon accountability and climate risk integration
Abstract:
Advancing net zero strategies requires a comprehensive approach that includes accurate carbon accounting and integrating climate risks into business processes and investment decisions. This involves not only reducing emissions, but also managing the risks associated with climate change, as well as using renewable energy sources and improving energy efficiency. Accurate measurement and tracking of greenhouse gas emissions is needed at all stages of operations, including direct and indirect emissions. Companies should assess and consider physical risks (e.g. floods, droughts) and transition risks (e.g. changing legislation, new technologies) in their operations and investment strategies. Strategies for achieving zero balance:
- Reducing emissions: Switching to renewable energy sources, increasing energy efficiency, optimizing production processes.
- Emissions offsetting: Investments in carbon capture and storage projects or forest conservation projects.
- Mitigation: Developing products and services that are adapted to climate change.
Today, more than three billion people live in areas highly vulnerable to climate change, and more than one billion urban dwellers live in informal settlements. The impacts of climate change not only increase urban populations through displacement and migration caused by climate crises, but also exacerbate the socio-economic problems associated with urbanization. At the same time, cities are major contributors to climate change, as urban activities are the main source of greenhouse gas emissions. In 2020, Kazakhstan announced its goal to achieve carbon neutrality by 2060. In its updated Nationally Determined Contribution (NDC), Kazakhstan set a target to reduce GHG emissions by 25 percent by the end of 2030 compared to the 1990 baseline. The country aims to facilitate access to international technology transfer mechanisms, stimulate climate investment financing and participation in global research, promote the development of promising low-carbon technologies, and support initiatives to train local specialists. Most CO₂ emissions from the energy sector come from the combustion of fossil fuels such as coal, oil and natural gas to generate electricity or to fuel transport and machinery. As part of the decarbonization strategy, it is planned to bring utility tariffs closer to a level that ensures cost recovery, while the state will provide targeted assistance to vulnerable families. This will help the country achieve its climate goals by stimulating private investment in renewable energy and energy efficiency technologies.
