The key now for companies committed to climate change is to achieve net-zero emissions. This concept has now superseded the more narrow “climate-neutral” concept as it forces companies to reduce 90-95% of their emissions and offset their residual emissions with internationally certified projects to remove CO2 from the atmosphere. Implementation of renewable energy and efficient energy strategies is also critical for companies and an easier goal as increasingly market prices level up with non-renewables.
Net-zero strategies and technology deployment are two pillars in the fight against climate change. Obviously for some industries which need very high temperatures to operate (like the ceramics sector) some new and expensive energy sources – like green hydrogen – will not be an option for their net-zero targets. Yet, it may well be in 2040 when the technology has matured.
Having said that, many companies are making very ambitious net-zero commitments without having appropriate plans and strategies in place. In one recent interview, Sundar Pichai, the CEO at Google, was asked how they were going to deliver on their carbon-free promises. He was visibly anxious as he acknowledged that he wasn’t sure how they could accomplish that target. ““It is a moonshot (…). So it’s a bit stressful, because we don’t fully have all the answers to get there.” Plans and roadmaps need to be robust and realistic. A 2030 timeline is not a viable timeline for most companies if you include all relevant emissions (not only scope 1 and 2) and if the target is net-zero( instead of climate-neutral). We work with our clients to develop credible plans for their net-zero targets by 2040. Currently, two of our clients are putting these plans to their Board for formal approval.