NET ZERO TRANSITION – THE LATEST SIGNALS OF CHANGE: NOVEMBER, 6, 2023We Mean Business Coalition
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Here are this month’s signals of change towards…
A just transition from fossil fuels to clean solutions: Sector-wide business action and enabling government policy to phase out fossil fuels and phase up clean solutions.
The IEA has said that the world is on an “unstoppable” shift towards renewable energy. Its latest World Energy Outlook report predicts that renewables will provide half of the world’s electricity by 2030.
Meanwhile, the ASEAN energy outlook has outlined how the region – which is home to some of the world’s fastest-growing economies – is turning to renewable energy in response to growing energy demand and to safeguard energy security.
Also last month, the world’s largest offshore wind farm started powering the UK grid. A joint venture between Britain’s SSE and Norway’s Equinor and Vårgrønn, the Dogger Bank site will eventually power 6 million homes once all turbines are operational in 2026.
Lastly, the Rockefeller Foundation has launched a $1 billion dollar pledge to support climate solutions. The Rockefeller Standard Oil Company was the leading source of U.S. petroleum in the early 1900s, but that wealth is now being used to reduce coal-fired power in Asia and to speed up battery storage for renewables.
Stockholm is to ban petrol and diesel cars from key parts of the city centre to improve air quality and reduce traffic noise. Starting from 2025, the ban will cover 20 blocks of the inner city in a bid to speed up the electric vehicle transition in the city.
Meanwhile, Japan has successfully tested wireless EV charging. A road test, run by a partnership made up of two universities, a real estate group, tyre manufacturer Bridgestone and two auto parts makers, saw charging coils embedded in the road surface in front of traffic lights – where EVs can recharge. Tests show 10 seconds on the coils can add 1 km of range.
Next to the U.S., where the Department of Energy has awarded the National Grid a $1.2 million grant to build to build a Northeast Freight Corridors Charging Plan. The study will map out truck charging needs across almost 3,000 miles of major highways.
Staying with trucks, EU lawmakers have agreed on a proposal to boost the uptake of clean trucks and buses. A final vote in the EU Parliament by 22 November is expected to introduce a new target for a 90% reduction in CO2 emissions for heavy-duty vehicles by 2040.
Estonia and Finland have signed a Memorandum of Understanding to create a green shipping corridor on either side of the Gulf of Finland in a bid to develop climate-neutral and sustainable journeys for both passengers and cargo.
Staying with shipping, ship retrofitting project WHISPER has received €9.2 million in funding from the EU’s Horizon Europe fund. Plans include developing wind-solar hybrid systems to reduce engine emissions and a tilting wingsail system for wind-assisted propulsion.
The U.S. Department of Energy has pledged US$7bn to launch seven Regional Clean Hydrogen Hubsto accelerate the commercial-scale deployment of low-cost clean hydrogen. The hubs are expected to produce three million metric tonnes of hydrogen annually, with the potential to cut emissions from hard-to-abate industries, representing 30% of U.S. carbon emissions.
Next to green steel, and to the HYBRIT project which has had a significant breakthrough in hydrogen storage this month, demonstrating a cost reduction of up to 40%. The HYBRIT project is a joint venture between Swedish steel company SSAB, mining company LKAB, and energy company Vattenfall.
Meanwhile the European Commission has announced funding of €88 million for engineering consultancy RINA’s Hydra project, which will build a 100% hydrogen fuelled green steel plant. Upon completion, the Hydra will produce up to seven tonnes of different grades of steel per hour.
Lastly, ENGIE and POSCO Holdings are conducting a pre-feasibility study for a flagship green hydrogen project in the Pilbara region of Western Australia. This would be used to power POSCO’s Hot Briquetted Iron plant in Port Hedland to produce green iron and could potentially supply green fuel to decarbonize the company’s operations in South Korea.
A new joint study from Schneider Electric and Boston University has found that the transition to net-zero buildings could result in the creation of over two million new jobs. The study predicts job creation of more than 800,000 jobs in the US market and 247,000 in the UK market. The findings relate to deploying rooftop solar and installing heat pumps and energy storage batteries for self-produced renewables.
In a round up of low-carbon cement solutions, the Canary reports that leading firm Brimstone has received third-party certification that says its Portland cement – which avoids CO2 from limestone – is structurally and chemically identical to conventional cement, which should boost its attraction for the risk-averse construction industry.
Lastly, Swedish home energy tech supplier Aira has secured €87 million in funding from investors to supply heat pump and home energy technology across Europe. It says it will use the funding to launch an affordable monthly payment model for homeowners.
The European Sustainability Reporting Standards (ESRS) survived a challenge from a group of MEPs in the European Parliament aimed at watering down the bill and will now go ahead as planned. The standards will apply to more than 50,000 large companies, who will need to embed environmental disclosures into their reporting from 2024.
Meanwhile California has become the first U.S. state to introduce mandatory reporting for large corporations operating there. Democratic Governor Gavin Newsom has signed two bills meaning that these companies must disclose both their carbon footprints and their climate-related financial risks starting in 2026.
As a direct result of the latest IEA report on energy grids, share prices of companies engaged in building electric grids have soared. As a result, investors are anticipating waves of interest in financing electric grids, with predictions that firms involved in solving connectivity bottlenecks could benefit from growing investor interest.
Lastly, members of the UN-convened $9.5 trillion Net-Zero Asset Owner Alliance have recorded their first ever fall in their collective financed emissions year-on-year, with a drop of 3.5%. The reduction is attributed to real-world emissions reductions, divestment from high-carbon businesses and sectors, and the re-allocation of finance within sectors to lower-carbon firms and projects.
Protecting and restoring nature: Business action on land and nature – which can deliver 1/3 of the climate solutions needed by 2030
Up first, a new study from Ecosystem Marketplace commissioned by We Mean Business Coalition has shown that most companies participating in the voluntary carbon markets are climate leaders, not climate laggards. In fact, findings show companies buying carbon credits are 3.4 times more likely to have science-based targets and are not using carbon credits to greenwash their operations but instead using them as a tool to accelerate action on climate change.
Meanwhile, a study from Nature4Climate, investment firm Serena and nature tech membership body MRV Collective has found that investment in nature tech startups has surged by $7.5bn worldwide since 2018, indicative of rising corporate interest in nature-based solutions.
Ahead of the COP28 conference in Dubai, more than 70 organizations have signed an open lettercalling on national governments to acknowledge the critical role of food systems in achieving the goals of Paris Agreement. The signatories refer to food production, consumption and waste, land use change and nutrition as areas in need of consideration to cut emissions from this sector.
Lastly, the UN Environment Programme Finance Initiative (UNEP FI) and the Finance for Biodiversity Foundation (Ffb) are launching two new pieces of nature guidance. The first piece will focus on banks and is due to launch in November, while the second will focus on asset owners and managers and will launch in December.
Decarbonizing global supply chains: Business action to engage suppliers and address Scope 3 emissions – which account for more than 70% of a typical company’s carbon footprint
Retail giant Amazon announced in its recent sustainability report that it will require suppliers and sellers to share their emissions data, set emissions goals and report on their progress from 2024 onwards. Other companies mandating emissions report by suppliers include Salesforce and AstraZeneca, CNBC reports.
Next to California, where lawmakers are urging the U.S. Securities and Exchange Commission to follow their lead in requiring large businesses with more than $1 billion in annual revenue to disclose their Scope 1, 2 and 3 emissions to a reporting entity with emphasis on the importance of consistent and reliable Scope 3 data to capture the true scale of climate risks and opportunities.
The Clean Energy Procurement Academy, launched through the Clean Energy Buyers Initiative, aims to help supply-chain companies to develop the necessary knowledge and skills to access clean energy. The Academy is supported by Apple, Amazon, Meta, Nike, PepsiCo, REI Co-op – and We Mean Business Coalition.
Lastly, the UK and Ireland wing of food services giant Sodexo has launched a new supply chain climate engagement programme to support its 2040 net zero target. As part of the strategy, it will now only work with suppliers that can demonstrate tangible progress to reduce their climate impact through reporting and targets from January 2030 onwards.
Latest from We Mean Business Coalition
On the road to COP28, the Coalition has convened 131 companies large and small with a combined revenue of nearly $1trillion to sign an open letter urging governments to ramp up clean energy at pace, and to phase out the use and production of fossil fuels.
Ahead of and to complement the first UNFCCC Global Stocktake at COP28, together with the Climate Champions Team and Bain & Company, we have launched the Corporate Climate Stocktake 2023 (CCST), looking in detail at eight sectors critical to delivering on our climate goals – power, road transport, concrete &?cement, steel, shipping, hydrogen aviation and agriculture.
Companies taking action
As of this month, over 13,000 companies are taking action through Coalition partner initiatives.See all companies who committed in the past month on the We Mean Business Coalition website.
Companies setting their ambition for net zero include:
- 6,437 companies are working to cut their emissions in line with science through SBTi
- 6,913 small and medium-sized enterprises are working to cut emissions with the SME Climate Hub
- 445 companies have now signed the Climate Pledge, to reach net zero by 2040.
Meanwhile, companies are driving down emissions through the following demand-side initiatives:
- 130 companies are accelerating the transition to electric vehicles with EV100, and 5 companies are kickstarting the transition to zero-emission medium- and heavy-duty vehicles with EV100+.
- 5 companies are committed to improving their energy efficiency through EP100.
- 421 companies have committed to 100% renewable energy with RE100
- 32 companies have joined ConcreteZero to create a market for net zero concrete
- 38 companies have committed to SteelZero to create a market for net zero steel
CDP announced this month that over 23,000 companies – including listed companies worth US$67 trillion (over 66% of global market capitalization) – reporting environmental information in 2023 through its global disclosure system. This is a 24% increase from last year in the number of companies disclosing, continuing the positive global trend for corporate transparency and accountability.
- B4N It’s Now for Nature campaign & handbook launch webinar – 9 November 10am CET OR 4pm CET
- APAC Climate Week: 13 – 17 November 2023
- FT Moral Money Summit Africa – 21 November
- COP 28 – 30 November – 12 December