There’s a lot of talk about getting ‘back to business’ as lockdown restrictions are eased and we start to pick up economically.
But for many organisations, forwards is where they are now focused. And with so much noise around net zero and how businesses will need to play a vital role in helping the UK reach its decarbonisation targets, decisions around energy use and management will be key.
In our recent Future Report 2020: The Road to Net Zero, we asked experts – including Professor Sam Fankhauser, Director of the Grantham Research Institute on Climate Change and the Environment, and Arjan Geveke, Assistant Director of Energy Policy at the Department for Business, Energy and Industrial Strategy (BEIS) – to share their views on the direction businesses should now be looking to take.
Net zero core to recovery
In the immediate term, there is consensus that assessing the full impact of the Covid-19 crisis and any changes to the UK energy market following Brexit need to be the key focus.
But like many businesses, trade bodies, academics and think tanks, there’s a firm belief that net zero and climate action need to be core to the UK’s economic recovery post-Covid-19.
While many businesses will have put longer-term sustainability plans on-hold to focus on shorter-term operational resiliency, it is becoming clear that reducing an organisation’s carbon impact can go hand-in-hand with a more robust business outlook.
Energy efficiency, on-site generation, procuring green energy, reducing and shifting demand will all become more important, particularly as consumers become increasingly influential in ‘calling out’ good and bad business practice.
Policy clarity needed
From a policy perspective, the long-awaited Energy White Paper and the Treasury’s Net Zero Review should also be published this autumn, providing businesses with a much needed roadmap and greater policy certainty to plan for a net zero future.
According to BEIS’s Arjan Geveke: “We will have to analyse the impact of the pandemic on our policies, particularly in the long term where you see lower electricity demand on the system, plus more decentralised electricity... more consultations will come later this year – just bear with us.”
Technologies on the horizon
Significant investment is also needed in the technologies required to deliver the net zero goal, with several areas expected to come to the fore over the next five to ten years.
According to Sam Fankhauser: “On the demand side, there will be a huge block of demand from electric cars. That transition is happening a lot faster than many people probably anticipated.”
Storage is another growth area. “I think in ten years we should see a solution to the storage problem, which will allow us to ramp up renewables even more.”
Carbon Capture and Storage (CSS), alongside bioenergy, are also on the agenda. “Negative emissions will become a business over the next ten years for many power producers.”
And he anticipates load management becoming much easier and more automated: “A machine will do it for us. If it comes together with better storage capacity, then a lot of worries go away.”
For Robert Buckley, Head of Retail and Relationship Development at Cornwall Insight, decarbonising heat will also be key. “Some big strategic decisions need to be taken before 2025 on the decarbonisation of big urban heat within parts of industry, particularly where we have capital intensive heat sources with very long lifetimes.”
Taking action: what businesses can do now
The Future Report also considers some of the most common questions we get asked by customers, with responses provided by our own Ben Spry, Head of Risk Management, and Richard Spencer, Head of Technical Services and Operations.
For example:
• What can businesses do to reduce their carbon emissions?
• How can businesses protect themselves from price uncertainty?
• What are the best options for on-site generation?
• What about the investment case for Demand Side Response (DSR) and flexibility?
• What new technologies should businesses be tracking?
You can find out the answers – and lots more insight to support planning a net zero strategy – in the Future Report 2020: The Road to Net Zero.
In the meantime, if you have any questions, please do Get in touch. Or for existing customers, speak to your Client Lead.
