CCA Portfolio Management 3

Question 1

Under PCAF, how is the attribution factor for a residential mortgage calculated?

Accepted Answer

Outstanding loan divided by property value at loan origination

Answer

PCAF attributes mortgage emissions using the outstanding amount over property value at origination.

Question 2

What denominator does PCAF use to attribute emissions for sovereign debt?

Accepted Answer

PPP-adjusted GDP

Answer

PCAF's sovereign debt method divides outstanding exposure by purchasing-power-parity-adjusted GDP.

Question 3

For project finance, PCAF attributes emissions based on the lender's outstanding amount divided by what?

Accepted Answer

Total equity plus debt of the project

Answer

Project finance uses the project's total equity and debt as the denominator.

Question 4

Which metric expresses financed emissions per million dollars invested?

Accepted Answer

Carbon footprint

Answer

Carbon footprint = total financed emissions divided by portfolio value (tCO2e/$M invested).

Question 5

An asset manager reports a portfolio implied temperature rise (ITR) of 2.7°C. What does this indicate?

Accepted Answer

The portfolio's holdings are on a pathway consistent with 2.7°C of warming

Answer

ITR translates holdings' emissions trajectories and targets into an implied global warming outcome.

CCA - Certified Carbon Auditor Practice Test