Net zero transition – the latest signals of change: April 14, 2023We Mean Business Coalition
Signals of change in the net zero transition this week include a call for G7 countries to phase out fossil fuels, and multinationals’ investing in nature.
Net Zero Economy
G7 Energy and Environment ministers meet in Sapporo, Japan this weekend ahead of next month’s Leaders’ Summit. The We Mean Business Coalition has published an open letter calling for an acceleration of the just transition to a more stable, clean energy system, and away from fossil fuels. The letter recommends policy measures that would send clear signals to business on the speed and direction of travel away from fossil fuels, remove barriers to rapidly scaling renewables, and ensure the most effective and efficient private sector investment and just transition pathways.
A new report from Ember predicts that carbon emissions from global electricity generation will decline from this year onwards. Authors of the Global Electricity Review analyzed data from 78 countries representing 93% of global demand, finding record growth in wind and solar power, which accounted for 12% of the world’s electricity generation last year. The study shows that Europe’s position as leader of the renewable revolution has been overtaken by Oceania, which now receives 1/5 of its electricity from wind and solar, while North America and Asia are also catching up fast.
France has shared new proposals for green industry incentives in the latest move to stay competitive in the global green economy. The measures, which include tax credits and subsidies, would target producers of batteries, electrolyzers, heat pumps, and other renewable energy technologies. Lawmakers and business leaders will take part in a public consultation on the amounts and scope involved before the package is brought to the French parliament this summer.
Democratic Republic of Congo-based solar startup Nuru is close to concluding a $60 million funding round. The company, which already runs four solar mini-grids, will use the funds to add a further three, increasing its capacity ten-fold to almost 14 MW. Mini-grids powered by renewables are seen as a key energy solution in the DRC, where only about 10% of the 100 million inhabitants have access to electricity.
Consumer goods giant Kimberly Clark has confirmed that the wind farm that will serve its first UK-based green hydrogen project will come online by the end of the year. The 126 MW wind-to-hydrogen project has won public funding support, with green hydrogen production projected to commence in 2025. The company plans to offtake green hydrogen from the project to replace gas in its paper mills in Cumbria, Kent and North Wales. Until hydrogen production begins, Kimberly Clark will use renewable electricity from the wind farm via a Power Purchase Agreement.
In the US, outdoor clothing company Recreational Equipment Inc announced a new commitment to source locally generated renewable energy in each of its 181 stores and support clean energy projects. In addition to measures such as deploying more rooftop solar across its locations, REI has shared strategies aimed at benefiting local communities. This includes working with utilities to offer renewable power programs to small- and medium-sized businesses and partnering with project developers to simplify transactions, making it easier for businesses of all sizes to procure renewable energy.
Volkswagen is to set up a new academy in China’s Hainan province, working with local authorities, to train local talent for the electric vehicle industry. The academy will be the second such facility established this year by VW – which is the top-selling car brand in China – in support of their €15 billion electrification plan in the country. Hainan province aims to end the sale of petrol vehicles by 2030.
The US Environmental Protection Agency has proposed new EV targets to ensure that two-thirds of new passenger cars and a quarter of new heavy trucks sold in the country are all-electric by 2032. Currently, less than 6% of new cars sold in the US are EVs, and under 2% of trucks. Though it can’t directly mandate that carmakers sell a certain number of EVs, the EPA can limit the pollution generated by the total number of cars each manufacturer sells. Michael S. Regan, EPA Administrator, said the measures “will accelerate our ongoing transition to a clean vehicle future, tackle the climate crisis head on and improve air quality in poor communities all across the country.”
In South Korea, Hyundai Motor Group has announced an $18 billion investment in domestic EV manufacturing. The conglomerate, which includes Hyundai and Kia, aims to become one of the world’s top three EV makers by 2030, expanding its domestic production to 1.5 million units and its global production to 3.6 million. To speed up product development, the automaker plans to unveil a manufacturing platform for each vehicle class, with one for passenger EVs to roll out in 2025.
Land & Nature
Companies including GSK, Bayer and Ørsted are scaling up investments in nature via in-house projects, Bloomberg reports. GSK has said it will prioritize carbon removal, as opposed to avoidance, for its 2030 targets, while for its 2045 target only removal offsets will be allowed. Endangered mangrove forests – which can sequester up to 50 times more carbon in their soils by area than tropical forests – are of particular interest to the company.
Salesforce has launched a new Nature Positive Strategy as part of its Climate Transition Action Plan. The strategy has three main pillars: reducing impacts on nature, leading nature restoration at scale and supporting customers to start their own nature positive journeys. Specific measures include the conservation, restoration and growth of 100 million trees by 2030 and distributing $100 million through its Ecosystem Restoration & Climate Justice Fund.
In Canada, multinationals including Mars, Nestlé and 3M have partnered with the Tsay Keh Dene First Nation people to support their forest protection efforts. Local indigenous people control the companies’ access to lumber and wood pulp – used for product packaging needs – across the 3.2-million-hectare area to ensure sites of cultural significance are preserved. Groups like the Earthworm Foundation and the Rights + Resources Initiative are supporting such efforts to accelerate corporate best practices and build direct relationships with local forest communities.
Built Environment & Heavy Industry
Laing O’Rourke, a founding member of ConcreteZero, has introduced a mandate to switch to low-carbon concrete on all new UK projects, in a move predicted to reduce Scope 3 emissions by more than 25% compared to its current concrete usage. The company is switching from conventional concrete to alternatives that incorporate Ground Granulated Blast-furnace Slag and Pulverized Fly Ash, which are industry by-products.
Germany’s Heidelberg Materials has signed a memorandum of understanding with the Canadian government, who will support the company’s carbon capture utilization and storage unit at its cement plant in the country. If the project goes ahead it will create North America’s first carbon-neutral cement plant and is expected to capture over 1 million tonnes of CO2 annually. Energy infrastructure firm Enbridge is developing the carbon sequestration hub where emissions will be stored.
And in South Korea, plans are afoot to add 4 GW of solar power to the rooftops and parking lots of industrial complexes across Gyeongsang province. Companies including Korea East-West Power, Korea Hydro & Nuclear Power, Hanwha Asset Management and Hyundai Electric & Energy System are in discussion with the Energy Ministry regarding their participation. The country, which is short of available land to ramp up its solar capacity, had around 21 GW installed at the end of 2021.
2 companies joined RE100:
Lotte Wellfood – South Korean food company
Umicore – Belgian recycling company
37 companies committed to set science-based emissions reduction targets through the SBTi Net Zero pathway:
ACS Dobfar S.p.A. – Italian pharmaceutical company
Alsico Group – Belgian textiles company
Amer Sports Corporation – Finnish clothing company
BNG Bank – Dutch bank
Boyd (Shenzhen) Thermal Systems Ltd – US-based hardware company
Boyd Plastic and Metal Parts (Shenzhen) Co. Ltd – US-based hardware company
Boyd Vietnam Company Ltd – US-based hardware company
Dairygold Food Ingredients UK Ltd. – UK-based food company
Daito Trust Construction Co.,Ltd. – Japanese real estate company
Eternis Fine Chemicals – Indian chemical company
Gebr. Heinemann SE & Co. KG – German retailer
GHD Group Limited – Australian construction company
GKN Aerospace Services Ltd – UK-based aerospace company
Infomed Fluids s.r.l. – Romanian pharmaceutical company
Intergamma – Dutch retailer
Kemin Industries, Inc. – US-based food and beverage company
KONICA MINOLTA, INC. – Japanese electrical equipment company
Koninklijke Vezet B.V. – Dutch food and beverage company
Mega Financial Holding Company – Taiwanese investment firm
Nexans – French electrical equipment manufacturer
Nordlo Group AB – Swedish software company
Nth Degree, Inc. – US-based events company
Omni Facilities Management – UK-based real estate company
PUNGKOOK SAI GON TWO COPORATION – PUNGKOOK SAIGON III FACTORY – Vietnamese textiles company
Royal A-ware – Dutch food and beverage company
Saferoad Group – Norwegian construction company
SHI International Corp – US-based software company
Stibo Software Group A/S – Danish software company
Stuart Delivery – French delivery company
Tongwei Solar (Hefei) Co., Ltd. – Chinese solar components company
UKG – US-based software company
UST Global Inc – US-based software company
Vitacress Limited – UK-based food company
Volex – UK-based electronics manufacturer
WS Audiology – Danish healthcare company
Zumtobel Group AG – Austrian lighting company
18 companies committed to set near-term emissions reduction targets through SBTi:
Akçansa Çimento Sanayi ve Ticaret A. Ş. – Turkish construction company
Altavia – French media company
Alterra Mountain Company – US-based hotel company
American Packaging Corporation – US-based packaging company and Packaging
Berglandmilch eGen – Austrian dairy company
Efficold, S.A. – Spanish building products company
EMIRATES TELECOMMUNICATIONS GROUP COMPANY PJSC (ETISALAT GROUP, e&) – UAE-based telecoms company
Garan Inc. – US-based textiles company
Glaston Corporation – Finnish electrical equipment manufacturer
HEALTH AND HAPPINESS (H&H) INTERNATIONAL HOLDINGS LIMITED – Hong Kong-based food and beverage company
Isuzu Motors Limited – Japanese auto company
KILOUTOU – French logistics company
KIRCHHOFF Automotive GmbH – German auto components company
LINAK – Danish electrical equipment company
Manutan International – French logistics company
OECHSLER – German auto components company
Rügenwalder Mühle Carl Müller GmbH und Co. KG – German food and beverage company
Shanghai Zijiang Color Printing&Packing CO ., LTD – Chinese packaging company
16 companies had their science-based targets approved:
AIB Group Plc – Irish financial services company
Andera Partners – French bank
ASTM S.p.A. – Italian logistics company
CapMan Plc – Finnish investment firm
Frasers Logistics and Commercial Trust Pte Ltd – Singaporean real estate company
Höganäs AB – Swedish metals company
Hon Hai Precision Inc. Co., Ltd. – Taiwanese tech company
Luceco plc – UK-based electronics company
Mitsubishi Materials Co. – Japanese mining company
Mott MacDonald Group Limited – UK-based professional services company
Nan Ya Printed Circuit Board Corporation – Taiwanese hardware company
Nutrition&Santé – French food and beverage company
THALES SA – French transportation company
Thermo Fisher Scientific Inc. – US-based pharmaceutical company
Uber Technologies, Inc. – US-based mobility company
West Fraser Timber Co. Ltd – Canadian forestry company
40 SMEs had their science-based targets approved.
Total number of companies committed to RE100: 401
Total number of companies committed to EP100: 126
Total number of companies committed to EV100: 127
Total number of companies committed to SteelZero: 31
Total number of companies committed to ConcreteZero: 28
Total number of companies and SMEs committed to SBTi: 4,844 (2,334 committed, 2,510 approved)
Total number of SMEs committed to SME Climate Hub: 5,728
Total number of companies committed to The Climate Pledge: 400
Webinars & Events
Climate Group US Climate Action Summit: April 19
Bloomberg Green Summit: April 26
Manager, Industry & Built Environment at We Mean Business Coalition
Europe Advocacy Manager at Climate Group
Various posts at BSR
Various posts at CDP
Various posts at Ceres
Various posts at CLG Europe (CISL)
Various posts at WBCSD
Various posts at SBTi