The opportunities and challenges in bringing about a Net Zero recovery

Landscape at sunrise and fog with wind turbines

But it is crucial that those efforts do not undermine efforts to tackle climate change, Guy Rickard, Associate Director at the Carbon Trust told the group’s 2020 Sustainability Summit.

The lockdown was the first time that many people had experienced truly clean air, said James Beard, Senior Campaign Manager for The Climate Group’s EV100 initiative. At the same time, it has accelerated the decline of certain industries, most notably the fossil fuel sector, which is facing the twin challenges of a steep drop in demand and growing moves to decarbonise economies – as exemplified by the growing number of Net Zero targets being introduced by governments and companies alike.

Climate action is good business

There are significant synergies between the imperative to decarbonise and the need to support the economy, because many of the measures needed to bring about a Net Zero economy – such as energy efficiency measures, rolling out the infrastructure required to boost the use of electric vehicles and planting trees – not only reduce emissions but also create large numbers of jobs, Beard said. 

The pandemic has highlighted people’s ability to adapt and there is a real opportunity to build on that, pointed out Sarah Jones, Environment Manager at Siemens.

The time for business as usual is over, said Alastair Mant, Head of Business Transformation at the UK Green Building Council. “If you look at the direction of consumer demand, investment allocation and regulatory oversight, now is the time to reset in terms of Covid and society. This is the year to switch in order to deliver Net Zero.

“Many of the solutions already exist and there is also plenty of technological and business model innovation going on, but not a lot of people know about it yet,” he added.

“This is a huge opportunity to accelerate change,” agreed Vaughan Lindsay, Chief Executive of ClimateCare. “People are buying products based on their climate credentials and companies are realising that they need to embed that if they want to do well. That is just good business.”

Playing the long game

Business is often ahead of the curve on sustainability issues, said Jones. “We need clear policy with a long term perspective that allows business to invest strategically in measures that align with the policy.” 

The energy industry highlights the importance of this long-term perspective, for companies as well as governments, said Henrik Nissen Sætness, Senior Vice-President at Norwegian energy group Statkraft. “Trying to understand how this will play out is important because of the level of change going on in the energy sector. You are at risk of being stranded if you are not investing for the long term. If your business is going to be bankrupt at a carbon price of €70, you need to rethink what you’re doing.”

There is a growing realisation of the risks involved in remaining a high carbon business, Lindsay said. “If you don’t get hit by pressure from consumers and investors, the government will get you with new regulations. It’s just too risky.”

He called for an economy-wide carbon price that would “allow the market to do what it does best” although he conceded that was “a bold ask”. He also stressed the need for action as well as plans. “Many plans have targets for 2030, 2040 or 2050, but it is today’s emissions that will cause tomorrow’s climate impacts.”

One encouraging development is that sustainability has moved “from the boiler room to the boardroom and is no longer a niche concern,” according to Beard. “The economics are getting better and better.”

Corporates will have a key role to play in accelerating the decarbonisation of the economy, which will involve “going all-in on electrification,” Nissen Sætness said, while Beard added that “we need radical collaboration to scale up these solutions at pace. No one has all the answers yet. We’re all figuring this out together.”

To take advantage of the opportunities to build back better and move towards a Net Zero future, we need both that collaboration and a scientific, fact-based approach, said Carbon Trust Director Hugh Jones. “Sustainability is at the heart of all the important decisions that companies make,” he added. “If we’re going to have any chance of meeting our targets, Net Zero really has to underpin everything that businesses, governments and societies do.”

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