Net Zero
Readiness
Index 2021
KPMG IMPACT
home.kpmg/NZRI
The Net Zero Readiness Index
(NZRI) is a tool that compares the
progress of 32 countries in reducing
the greenhouse gas emissions that
cause climate change, and assesses
their preparedness and ability to
achieve Net Zero emissions of these
gases by 2050.
Quick reader guide
Foreword
Net Zero Readiness
Index results
Key observations
and insights
KPMG has selected the 32 countries to capture insights
from across developed and emerging economies and
current energy exporters.They include members of the
G20 intergovernmental forum, as well as G20 invitees,
which are emerging or large economies; members of the
Organization of the Petroleum Exporting Countries; and
countries that had a Net Zero target in place at the time
of framing the methodology.
Global sector
summaries
Quick reader
guide
The date 2050 was proposed by a 2018 report of the
United Nation’s (UN) Intergovernmental Panel on Climate
Change, which said that cutting net emissions by about
45 percent from 2010 to 2030, then 100 percent by 2050
would limit temperature rises to 1.5 degrees Celsius.
The panel said that doing this would lessen the still-
substantial damage that global warming will cause over
the coming decades.
NZRI top 25 countries
NZRI countries to watch
Appendix
In August 2021, a report by the panel approved by 195
governments said that humanity has already warmed
the planet by approximately 1.1 degrees Celsius, that
1.5 degrees is likely to be reached or exceeded in the
next 2 decades and that without immediate, rapid and
large-scale reductions in emissions, limiting warming to
1.5 or even 2 degrees will be beyond reach.
Sources
3 | Net Zero Readiness Index 2021
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The NZRI uses the World Resources Institute defnition
ofNet Zero. Primarily, this involves reducing greenhouse
gas emissions caused by humans as close as possible to
zero. Remaining emissions are balanced by an equivalent
amount ofcarbon removal from the atmosphere,
effectively neutralizing humanity’s future impact on the
world’s climate.
Through this analysis, KPMG has identifed key
observations and insights that we see as critical to
understanding and overcoming the challenges of
the transition to Net Zero at a global level.The 32
participating countries have been grouped into two
categories: our view ofthe top-performing 25 countries
in the race to Net Zero based on progress to-date and
established initiatives; and seven countries to watch
where KPMG is seeing signifcant opportunities to
advance their decarbonization efforts through large-
scale projects and emerging escalation initiatives.
QuickQuick readerreader guideguide
Foreword
The main greenhouse gas is carbon dioxide, and work
towards Net Zero is often called ‘decarbonization’ to
refect the focus on this gas, which is released when
fossil fuels are burnt. However, emissions ofmethane
and nitrous oxide also make signifcant contributions to
climate change and are included in this Index.
Net Zero Readiness
Index results
As countries around the world race to implement
policies to reduce carbon emissions, it is likely there
will be movement, perhaps signifcant, in the rankings.
KPMG intends to update the NZRI regularly and share
insights on an ongoing basis.
How the NZRI works
Key observations
and insights
For each ofthe 32 countries, the NZRI considers
103 indicators that KPMG considers as key drivers
to achieving Net Zero.The indicators have been split
between national preparedness and sector readiness.
National preparedness considers a country’s national
commitment to decarbonize, its past decarbonization
performance and the national enabling environment for
decarbonization.
More information on the results, methodology and
sources used can be found in the Appendix.
The following abbreviations are used in the text:
Global sector
summaries
CO (carbon dioxide); ESG (environmental, social and
2
governance); GDP (gross domestic product); GW
(gigawatt); MtCO e (megatonnes ofCO equivalent,
2
2
used to measure greenhouse gas emissions). US
dollar equivalents for local currencies are correct as of
August 2021.
Sector readiness covers the fve highest emitting sectors:
electricity and heat; transport; buildings; industry; and
agriculture, land use, land use change and forestry (in the
report referred to as agriculture, land use and forestry).
NZRI top 25 countries
NZRI countries to watch
Appendix
The intended audience for the NZRI is governments
and the public sector, multilateral organizations,
investors and fnancial institutions, the private sector,
and the general public. It is likely to be ofparticular
interest to any entity, department, business or person
with an int