The building blocks:

We use your public data. And where data isn’t fully available, we have workable estimates based on peer databases and a comprehensive review of academic research. We use three types of data relevant to your company: GHG emissions reporting (in Scope 1-2-3 format), financial data (under GAAP or IFRS standards, five years generally), and cost data tied to green technologies. The latter is what is generally missing today for most corporations, because it is very asset-specific, and because it’s a discovery process — don’t worry, we have collated estimates for 44 of the most commonly used technologies, from nearly 100 pieces of research. For reasons described below, this still gives us very usable and information-rich estimates in our analysis.

How we prepare the data:

We model it out, in three layers. First, what your comprehensive emissions pathway most likely looks like through 2050 (because that’s the timestamp on most corporate net zero targets) — by scope, by line item, and gross versus net emissions. Second, the most likely portfolio of technologies to be applied along the way — based on peer commentary, market research, and based on your input or strategic imperatives, with estimated costs associated at each step, and specific technology inertia/maturity assumptions. Third, a detailed and proprietary analysis of your financial policies, and financial boundaries, based on how your company has presented itself to investors: how much cash flow or debt capacity do you have, what are the most essential value allocation priorities to protect (it’s a spectrum from shareholders to creditors), and what line items really drive your creditor and equity narratives (these are the ones that will be non-negotiable).

How we bring it all together analytically:

Think about it in this way: the second you start costing out decarbonization, you are putting a price on your carbon emissions. In a decarbonization discourse, that means that your emissions stock becomes economically indistinguishable from an unfunded financial liability — this doesn’t mean at all that it is legally or accounting-wise a liability, but just that you can manage its economic reality as if it is. Different cost layers — investments in green tech, carbon taxes, offsets — become akin to principal and interest. That you can optimize elegantly and powerfully. We are dealing with curves; when they move, dollar amounts change fast. But that also means that a change to a discrete individual assumption doesn’t shift the curve on its own — it’s the combination of all these effects that gives us the answer, it is emergent from the analysis. This gives you the “efficient frontier” of decarbonization, where carbon and cost outcomes are both optimized. Then we layer this onto your risk profile, and it gives us pressure points to manage. In turn, this tells us the right mix of funding across a portfolio of nine essential funding sources, from DOE guarantees to project financing. Finally, and crucially, this gives us metrics: returns, cash spend efficiency, and a robust internal carbon price, all of which become enshrined in both a C-suite dashboard and a communications recommendation for market participants.

What’s the end product?

We do any layer of analysis on an individual basis as well, but the combined toolkit yields the following:

• C-suite dashboard: comparison of pathways, cost curves, cash returns, cash leakage and spend efficiency, distance to financial boundaries, funding recommendations, peer comparison, and internal carbon price. Can be updated with any change of assumption or time period.

• KPIs for use by all internal teams: internal carbon price, rates of return, timing and quantum of investments, annual abatement track by scope and by technology, efficiency.

• Comprehensive Excel-based models, designed to be shareable with your sustainability teams, Treasury, FP&A, accounting, tax, etc. All auditable, traceable, with changeable inputs.

• Advisory service: communicate effectively to market participants, credit rating agencies, equity investors. We work closely with your finance teams, sustainability teams, and IR to bring it all together. We help you find a voice that is masterful, lucid, engaging, and that makes your culture shine.

• Modular: we offer the above in three layers: 1. carbon pathway, 2. financial risk advisory, and 3. comprehensive decarbonization strategy and funding. You can pick and choose, we’ll deliver it for you.

Is anybody else providing this type of service?

Nobody. We bring nearly 30 years of cutting-edge and leadership experience in both financial risk advisory and sustainability advisory, for the world’s largest companies. We partner with the world’s best universities, researchers, data providers. We know many industrial sectors and their players intimately well, and in many cases we were a leading voice in how analysis is performed in these sectors. We know financial markets well — what they do, and what they can’t do. We speak to policymakers on a regular basis, in private sessions. We have our ear to the ground, we bring you cutting-edge analysis, and some of the best intelligence in the market.