* Energy sector under scrutiny ahead of U.N. climate summit
* Oil and gas companies out of step with temperature goals
* Utility sector making more progress
By Simon Jessop and Matthew Green
LONDON, Sept 18 (Reuters) - Investors managing $15 trillionin assets turned up the heat on oil and gas sector on Wednesdayahead of a United Nations summit in New York aimed ataccelerating efforts to fight climate change.
Energy companies are on the front line of the globaltransition to a low-carbon economy, with investors potentiallyon the hook for hefty losses if the companies do not overhaultheir business models in time.
In its most detailed analysis of the energy sector, theTransition Pathway Initiative (TPI) said 31 out of 109 energyfirms were aligned with commitments governments have so far madeunder the 2015 Paris Agreement to curb greenhouse gas emissions.
However, of the 50 oil and gas companies assessed, just two- Royal Dutch Shell Plc and Repsol - werealigned with existing national emissions targets. The remaining29 companies on track to meet such commitments were all electricutilities.
"We, as a major institutional investor, are concerned thattransition risk - the large and growing gap between governmenttargets and company ambitions - is a major source of investmentrisk," said Helena Viñes Fiestas, global head of stewardship andpolicy at BNP Paribas Asset Management.
United Nations Secretary-General Antonio Guterres wantsgovernments to make more ambitious pledges to cut emissions atthe U.N. summit on Monday, which he convened to boost the ParisAgreement ahead of a crucial implementation phase next year.
Current pledges by governments to cut emissions are nowherenear enough to meet the Paris target of keeping the rise inaverage global temperatures to well below two degrees Celsius,with a goal of limiting warming to 1.5 degrees Celsius.
That means that some companies' targets can bring them inline with existing national plans under the Paris Agreement, butremain far from adequate to avert the worst of the naturaldisasters and economic damage forecast for a warming world.
TPI, which includes major pension funds and asset owners,said none of the oil and gas companies it assessed are doingenough to align their businesses with the changes needed to meetthe Paris temperature targets.
The findings echoed a report published this month byfinancial think-tank Carbon Tracker, which found that big oilcompanies had approved $50 billion of projects since last yearthat will not be viable if governments implement the Parisdeal.
By contrast, TPI found that nearly half of the utilitycompanies are aligned with national commitments already madeunder the Paris Agreement, and more than 20% are on target tomeet a temperature rise of below 2 degrees Celsius, the TPIsaid.
That is partly because some utilities have been quicker topivot their business models toward renewable energy than oil andgas companies.
"There is no doubt that oil and gas companies are in adifficult position in navigating the transition to a low carboneconomy," Euan Stirling, global head of stewardship and ESGinvesting at Aberdeen Standard Investments.
"That makes it all the more important that we have at leastsome sector constituents who are starting to respond to theclimate crisis by repositioning their businesses from the topdown in the same way that many power generators have."
The TPI is one of several investor initiatives launched inrecent years aimed at helping boost the quality andeffectiveness of investor engagement with companies on climate.Among its other 45 signatories are firms including Legal &General Investment Management and U.S. pension scheme CaLPERs.
"We believe that investors should use their voice to holdtop management of investee companies accountable forincorporating climate-related issues in their corporatestrategy," Carola van Lamoen, head of active ownership at Dutchasset manager Robeco.
(Reporting by Simon Jessop and Matthew Green; Editing by LisaShumaker)
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