At the recent COP25 summit, UN Secretary General António Guterres stated that “the point of no return is no longer over the horizon” when it comes to the current climate crisis.
This is no exaggeration – scientists warn that net-zero carbon emissions must be met by 2050 globally in order to prevent the catastrophic consequences of the Earth’s temperature rising by just 2 degrees.
For utilities, the issue of decarbonisation is both pressing and complex. With so many stakeholder groups with differing priorities making up our domestic utilities market, getting traction on a coherent strategy for change proves difficult. For every green innovation launched, a corresponding commercial model must be tested in real market conditions. To even start making strides towards widespread use of greener solutions, we must break the deadlock that exists between doing what is right and what is commercially viable. However, it is necessary that the investors and government departments responsible for creating policies for the utilities industry align. It could be said we lack signalling from these groups to help the energy market move forward in a period of potentially unprecedented change.
Having said this, it is possible to create change to save the planet while providing decent shareholder returns. Ethical capitalism is certainly achievable – behavioural economics shows that economically viable innovation provides the financial stimulus to accelerate change. That’s not saying it will be easy – organisational, cultural, and individual behavioural change on a large scale is imperative to make change happen. Both investors and government supporting collaboration will be key in this transformation. Industry also needs to devise ways of future proofing investment in green energy solutions. In doing this, industry strategists will be given the confidence they need to press ahead with rapid decarbonisation programmes.
Creating a coherent strategy through collaboration
But creating new approaches for how the market can operate in an age of cleaner energy is only part of the challenge – we also need to draw on the sector’s creativity and ingenuity, and turn innovative ideas into actionable strategies which will deliver on net-zero.
To do this, we need to move away from the tendency to work in siloes on individual innovation projects, instead, identifying where cross-sector synergies lie.
This will only be achieved if every part of the utility industry, supported by the government and investors alike, has in place sector-specific roadmaps, outlining the journey to cleaner solutions. These strategies, based on key industry insights, will allow us to identify areas where these synergies are. In identifying these, we will be able to bring together seemingly disparate stakeholders to unlock greater efficiencies. What’s more, creating and bringing together these sector-specific roadmaps will form the basis for a UK-wide strategy for utilities, uniting the industry under one common goal.
Ultimately, project culture will not provide the speed and consistency of change needed. Coming together in this way is the only way forward, and it is proven to work. Look at our Victorian ancestors, who pooled together the ingenuity of disparate groups to disease and increasing mortality rates, providing a better quality of life for entire communities. Collaboration at scale can achieve great things, and the utilities must draw inspiration from this mindset to effect real change in the face of a very similar threat to the future of the human race.
The UK has a history of outstanding innovation; using our collective intelligence to overcome immense challenges and paving the way for everything from geothermal pumps to solar and wind power. However, bringing the right innovations to market doesn’t happen overnight. It requires collaboration and consistent support and facilitation to ensure ongoing commitment from all parties. Taking the flow of innovative ideas and accelerating them into business as usual can be achieved via a more detailed and strategic roadmap that unites the industry under a common goal.
Collaboration for greener solutions is happening, but in light of the current climate crisis, we need to ensure that the industry commits to working together to develop and deploy innovative solutions and boost the rate of change – before it’s too late.