The known unknown of Britain's low-carbon progress
At last week's Effective Energy Management Conference, Rolls-Royce's director of energy gave a frightfully honest answer to a question about how his firm will reach an ambitious 50% energy reduction target.
“I know how we can get halfway there, but I’m unsure how we’ll achieve that additional half – it remains an unknown,” Tim Sullivan said.
Should Tim be scared? Should Rolls Royce stakeholders be unconfident that it will reach that 10-year goal? Should the engineering group’s strategy be based only on the known knowns of sustainability?
No. Tim is in an ideal position. Sustainable business is about learning from the future as it emerges. It is about taking voyage of discovery into unknown lands, seeking not for new territory but for new technologies and innovations. It is about setting bold targets for the future that you don’t know exactly how you’ll reach today.
… A philosophy that Rolls-Royce's sustainability team - and many other sustainability departments across the UK - are just getting used to. “We’re heading for a target that we haven’t got detailed plans to back up, but we’ve convinced ourselves that we’ll get there,” Tim added. “We’re assuming that new technologies will emerge and that the economics of certain energy efficiency investments will improve - there are a number of factors that could help us.”
Two days later, the UK’s Under Secretary of State for Energy Lord Nick Bourne was putting pen to paper at the UN headquarters in New York, joining 174 other global heads of state to sign the ambitious Paris Agreement on climate change.
Do any of those 175 represented countries know exactly how exactly how the world will reach that crucial global warming target of two degrees? Will all of the intended nationally-determined contributions (INDCs), when combined, actually take us to that end-goal based on current trajectories?
No. But - as I wrote during the Paris talks - the ambitious nature of that agreement – and the global furore surrounding it – is delivering a much greater, but much less tangible, catalyst for low-carbon growth: confidence.
Governments - and businesses – have realised that the real benefit of the Paris Agreement is the stimulation of an increase in green infrastructure investment - an increase that could be sufficient enough to move the entire global economy a step closer to that two-degree pathway.
“The new market demand for low-carbon energy is going to be a self-accelerating process,” said Sir David King at a sustainable development event on Monday. “As the renewables market grows, prices fall, and when they become cheaper than fossil fuels, we’ve won the battle – that’s the positive side of Paris Agreement. Don’t just add up all of the INDCs mathematically; look at the whole process that underlines them.”
Today, the UK Government is faced with a similar challenge of moving into the unknown. The Energy and Climate Change Select Committee has just concluded that an unequivocal adoption of the fifth carbon budget - backed up by a clear plan to deliver it - is essential to cut emissions cost-effectively and support the continued growth of the Britain’s low-carbon economy.
Do Energy Secretary Amber Rudd and her Department of Energy & Climate Change (DECC) teammates currently have all the answers to reach a 57% reduction in carbon emissions from a 1990 baseline by 2030? Are the UK’s current green policies structured in a way that will allow us to achieve that goal?
Should the Government accept the fifth carbon budget (as a minimum), and step confidently into the unknown?
“Now is the time to translate international commitments into a new set of national policies to guide cost-effective investment in energy efficient, low-carbon transport and clean energy technologies over the next 15 years,” says Aldersgate Group executive director Nick Molho.
Setting ambitious targets is the first step for the UK to achieve a sustainable, low-carbon economy. And to reach those targets, businesses and politicians alike are fuelled by the greatest motivator of them all - the unknown.Luke Nicholls