Climate Week NYC roundtable outcomes report

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How to navigate the ‘messy middle’ to accelerate decarbonization today.

Roundtable outcomes report

Executive Series Partner

Roundtable outcomes report

Foreword Hon. Mike Rann, Climate Group Chair

I observed a remarkable consensus emerging during the roundtable discussion focused on two core topics: energy demand and the state of technology, especially in the context of energy.

We’ve all seen the prices of solar and wind power drop significantly, leading to fossil fuels requiring subsidies to stay competitive. This raises a fundamental question: What’s the next technological step forward?

From green hydrogen to AI there are many new tools at our disposal.

But what came through very strongly was the value of simplicity. While it’s often easy to chase the latest technological marvel, we shouldn’t overlook the power of energy efficiency. It might not be the most glamorous aspect, but improving things like boilers, air conditioning, and refrigeration can have a massive impact. Not only do these upgrades cut emissions, but they also translate into significant cost savings for businesses.

But how can we make energy efficiency more appealing? The answer lies in creating initiatives like a green bank dedicated to retrofitting. I chaired such a bank in Australia, and we discovered that the message shouldn’t focus solely on emissions reduction.

Instead, we should highlight how these changes save companies money in terms of power costs. By offering

loans to improve energy efficiency, we weren’t just enhancing environmental responsibility; we were boosting business profitability too.

And a key final piece of the puzzle is the importance of getting the regulations right. Cumbersome regulatory and permitting rules are consistently identified by business as barriers to more sustainable models.

This shouldn’t be the case. We need regulation to be an enabler rather than an obstacle. If we can align good regulatory frameworks and good policy and combine them with streamlined delivery of services, then we will successfully foster an environment that boosts energy efficiency and benefits business and planet in the long run.

While it’s often easy to chase the latest technological marvel, we shouldn’t overlook the power of energy efficiency”

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Roundtable outcomes report

Summary In recent years, businesses and governments have raced to show their commitment to net-zero.

Discussion areas: • The power of demand: The lowest carbon energy is energy that is not used.

What demand-side actions can businesses take to reduce energy intensity and why is this important?

The result: more than 90% of global GDP is now captured by national government targets to bring carbon emissions to net-zero by mid-century1.

But, despite these targets, action and progress to align with a 1.5°C climate pathway remains elusive. There is now a shared understanding of the current situation, a shared agreement on the goal, but the world is caught in the ‘messy middle’ trying to get from the former to the latter in time.

• The power of technology: Which technologies have the greatest potential to reduce emissions and what actions can businesses take now to leverage and scale them?

A lot of focus is on the need for policy change to remove the barriers and make it easier for organizations to deliver on their net-zero commitments. And while policy change remains crucial, there is a lot of action that can be taken now to accelerate change even with current policy frameworks and market incentives. From making energy savings and improving efficiencies, to using the most effective climate technologies and more.

• The power of collaboration: How can businesses work with governments and other organizations across these areas, and what enablers can help drive more partnerships?

The opening day roundtable invited business, policy and NGO leaders to explore the actions they can take as they navigate the ‘messy middle’. In particular, the discussion focused on the potential of energy demand intensity reduction and technology to drive major change that makes sense today.

1 Source: zerotracker.net

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Roundtable outcomes report

Partner reflections

Executive Series Partner

Will Jackson-Moore, Global Sustainability Leader, PwC UK

It was a privilege to co-host the Opening Day roundtable with such a great group of participants for a conversation on how to accelerate the net zero transition by acting on energy demand and leveraging climate technologies.

I’d like to thank the Climate Group for organizing the roundtable, Mike Rann for co-hosting it with me, and all the participants for their contributions to the discussion.

Here are some of my key takeaways.

Energy intensity reduction is good for the planet and makes business sense • Economic viability: By using energy more efficiently and using scalable technologies that are already available, companies can reduce their operational costs, which often account for a significant portion of their expenses. This, in turn, can lead to improved profitability and competitiveness in the market in both emerging and developed economies (helping accelerate economic growth for developing economies).

• Population growth and economic expansion pressures: The projected population growth of nearly 10 billion by 2050, combined with projected economic growth, will increase demand for energy by more than 20% based on the IEA’s Energy Outlook report2. This incremental projected demand will put an additional strain on meeting net zero targets, but could be alleviated through energy demand reductions.

2 Source: www.iea.org/reports/world-energy-outlook-2022

• Addressing the energy trilemma: The “energy trilemma” refers to the three key aspects of energy policy: affordable energy, secure energy, and an abundance of low carbon energy. Reducing energy demand intensity contributes to achieving all three of these objectives: it makes energy more affordable by lowering consumption, enhances energy security by reducing dependence on external sources, promotes low carbon energy solutions, thereby addressing environmental concerns, and reduces exposure to future regulation and carbon taxes.

Climate Tech as a transformative mega trend Climate technology is a multi-decade megatrend with the potential to transform the economy, reshape industries and address climate change. Like the advent of the internet, this presents businesses with an opportunity and often an urgent requirement to rethink their business models and value proposition to customers and society.

• Green hydrogen: The green hydrogen solution has emerged as a strong answer to the question of what to do with excess renewables. Emerging solutions around storage and transport will be key to ensuring its potential is effectively leveraged.

Energy intensity reduction is good for the planet and makes business sense” • Food and agriculture: The need for technology-enabled sustainability practices in the food and agricultural sectors will be a key consideration over the next decade amid growing global economic and population pressures.

• Hard-to-abate sectors: The challenge of transitioning hard-to-abate sectors should emphasize the urgency of exploring sustainable technologies and adopting innovative solutions in these industries.

• Artificial Intelligence: As AI solutions become more sophisticated and more widespread, it is crucial that the right policy frameworks are put in place to support rollout.

Precise and informed policy interventions will be key to maximizing the potential of important AI innovations.

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Roundtable outcomes report

Outcomes While the benefits are clear, barriers to large scale adoption of energy efficiency measures remain

Low priority perception Many individual companies may not prioritize energy intensity reduction, partially due to the fragmented nature of the available solutions. This perception challenge suggests that some businesses may not fully recognize the economic and environmental benefits of such efforts.

Lack of a compelling case Despite the recognized need for energy demand reduction, there often remains a lack of a persuasive business case to motivate businesses to take action. Without a clear and compelling rationale, companies may hesitate to invest in energy efficiency initiatives.

Financial barriers Implementing energy efficiency measures often requires upfront investments. Many businesses, particularly SMEs, face financial barriers in funding these projects. Access to affordable financing or incentives is crucial in overcoming this challenge.

Awareness gap There is often an awareness gap among businesses regarding the potential energy-saving opportunities available to them, and the scale of the impact on the energy transition that they can have. Raising awareness about available technologies, incentives, and leading practices is essential to help businesses make informed decisions. At the same time, this should be paired with a growing understanding of how to collaborate to drive wider systems change.

Challenges:

Regulatory and permitting hurdles Companies regularly encounter regulatory challenges when attempting to implement energy-efficient technologies or practices. Streamlining these processes would reduce barriers to entry for businesses looking to enhance their energy efficiency.

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Roundtable outcomes report

Solutions in financial, regulatory, technology forms exist and are available, but we need to change the focus towards them.

Building a strong business case Stakeholders should create a compelling business case for energy demand reduction.

This should emphasize the financial benefits, such as reduced operational costs, improved competitiveness, and attractiveness to consumers of energy-efficient products and services.

Financial support Financial incentives, such as tax breaks, grants, or low-interest loans targeted specifically at energy intensity reduction, should be provided to encourage businesses to invest in energy efficiency projects. This work should be shared across the private and public sector.

Awareness campaigns Launching awareness campaigns targeted at businesses can help close the awareness gap. These campaigns can educate companies about available technologies, leading practices, and the positive impact of energy efficiency on their bottom line.

Streamlined regulations Governments need to talk about demand as much as supply in the energy and net zero transition. Practically they can work to simplify and streamline regulations and permitting processes related to energy efficiency projects. Clear and efficient regulatory frameworks make it easier for businesses to adopt energy-saving measures.

Data collection and analysis ‘If you can’t measure it, you can’t manage it’. Data is a critical asset for understanding energy consumption patterns, identifying inefficiencies, and measuring the impact of energy-saving initiatives. Collecting accurate and comprehensive data on energy usage across residential, commercial, and industrial sectors is essential.

Solutions:

Technology advancements Advancements in energy-efficient technologies can provide more accessible and cost-effective solutions for businesses. Staying up to date with these technological developments is essential for companies seeking to improve their energy efficiency.

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Thank you to PwC for co-hosting the Executive Series at Climate Week NYC 2023.

Get in touch to learn more about how you can partner and collaborate with us at Climate Week NYC and across 2024.

Contact: sponsorship@theclimategroup.org

Executive Series Partner

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