Five Misconceptions of Decarbonization, and Tips on How to Get Started
Schneider Electric is a Business Reporter client.
If good intentions could decarbonize the world, our climate-change mitigation ambitions might not be so perilously close to moving out of reach. The most recent UN Climate Change Report reveals that the world is on track to miss its 2050 net-zero targets, with global temperatures set to increase by more than 2.4°C by 2100. Other research has shown that just 8% of Fortune 500 companies are meeting their carbon targets.
Addressing the challenge is a monumental task. At Schneider, we have helped our customers reduce CO2 emissions by over 400 million metric tons. But our conversations with partners and customers frequently highlight misconceptions held by businesses at the start of their journeys to net zero. To help businesses move from intention to action, here are five of the most common myths surrounding decarbonization, and advice on how to get started.
Myth #1: We’ve got plenty of time
Time is almost up; we need to act now. From extreme heatwaves to intense flooding, we have all witnessed the impacts of climate change. Rising emissions are ravaging our world, while global demand for energy continues to dramatically increase. It’s clear that we can’t continue on this course—and we know what we need to do to offset the increasing demand.
Decarbonizing a business isn’t a one-off action; it needs to be treated as a continuing business operation, with senior oversight, clear goals and an actionable plan. If a change in the business needs to be made, it only makes sense to make the choice a sustainable one. At Schneider, we follow a three-step approach: strategize, digitalize and decarbonize.
Strategizing requires the collection and management of data. Businesses need to understand the size of their carbon footprint, what contributes to it and where the biggest opportunities are to reduce emissions. Digitalizing means that organizations should create a single source of truth for their energy and sustainability data while monitoring resource usage and identifying opportunities to save. Finally, executing a decarbonization strategy requires electrifying operations, reducing energy use, replacing energy sources and engaging the value chain.
Myth #2: It’s cost-prohibitive
There is no point paying for more energy than you need, whether it has been generated from fossil fuels or renewable sources.
Deploying digital tools enables organizations to monitor, visualize and manage energy consumption. We typically find that just by deploying a building management system, or an energy management system at an industrial site, organizations can see a 20% reduction in energy consumption, even before any significant analysis and optimization is undertaken.
Of course, these software systems need to be able to communicate with the electrical equipment and machines that are integral to offices, manufacturing plants and public spaces; they typically include lighting, heating, circuit breakers, motor starters and transformers. Sensors can be fitted to collect data from older systems if smart, connected devices aren’t already in place.
Once these systems are deployed, it’s possible to optimize energy use and reduce energy waste. With the current high price of energy, these systems pay for themselves in a year or two—and the ongoing savings can help fund further decarbonization.
Myth #3: It’s too complicated to get started
Even before today’s global energy crisis, with shortages and soaring costs, renewables had already become the cheapest source of new energy capacity for more than two-thirds of the world’s population. Switching to a renewable electricity supplier is the simplest and fastest way for a business to decarbonize.
Beyond purchasing renewable power, a business’s own microgrids, powered by solar or wind, can provide an excellent way to reduce energy costs and emissions and add resilience to company operations. With extreme weather and other macroeconomic events disrupting energy supplies across the globe, being able to generate and store your own power could be the difference between business as usual and business disruption.
Myth #4: There isn’t enough data
Many companies consider a lack of data to be the main challenge when implementing sustainability goals. The reality is that you can’t show progress on what you don’t measure. By putting digital solutions in place, businesses can measure and manage energy consumption and carbon emissions.
For example, heat pumps could increase energy savings by up to 80% and reduce carbon emissions by the same figure compared with natural-gas burners. And while not everything can be immediately electrified, the technology exists today to electrify far more than we might realize; on average, 78% of industrial processes are not electrified, but 50% could be. Machines that run on diesel fuel can be swapped for electric versions that operate more efficiently, and with zero emissions if powered by renewable electricity. When looking for a place to start, evaluating your Scope 1 emissions and taking steps to electrify processes is a great way to begin your journey.
Myth #5: It’s too big for any one company to address
Some may feel overwhelmed by the problem at hand, and that their individual business can have very little impact on climate change.
But governments continue to regulate energy consumption. For instance, we’ve seen in recent months that the EU is making Scope 3 disclosures mandatory. Scope 3 encompasses emissions that a business is indirectly responsible for up and down its value chain—the emissions created by extracting and shipping raw materials to manufacture a product, and emissions generated by the logistics of getting a product to the customer, and the energy consumed by that customer when using the product. Any business that is part of a supply chain or that leverages suppliers may soon find itself accountable for compliance.
The good news is that businesses are collaborating to reduce energy use and emissions. At Schneider, we are working closely with our partners to help create a more sustainable future together.
To find out more, please check out our blog and podcast.
— Rohan Kelkar, Executive Vice President, Power Products Global Business, Schneider Electric
Image: Getty Images id488398873
