Sustainability has risen up the board agenda in recent years, fueled by rising energy costs, ever-increasing regulatory and reporting requirements and growing expectations of stakeholders and supply chains to work with environmentally-conscious manufacturers. The pressure on firms is growing: since it was enshrined in law last year, the target to reach net zero by 2050 will create new expectations on businesses of all sizes to play their part in the decarbonization of energy, buildings, heating and transport.
Yet despite the swell in support for climate change action, little detail has emerged to shed light on what businesses will be expected to do to help the UK deliver its emissions targets. Instead, a whole new vocabulary has emerged as an increasing number of organizations announce their intentions to reach net zero, achieve carbon neutrality, become carbon negative or eliminate emissions. In the absence of clear government guidance, organizations have had to determine their own definitions of net zero, but is this ‘carbon jargon’ – the different ways of describing emissions reduction targets, strategies and measurements – helping or hampering progress?
In our recently published research into business attitudes to net zero, 97 per cent of manufacturers have carbon reduction strategies in place – the highest proportion of any sector surveyed – yet only half of organizations fully understand the term ‘net zero’. Two thirds of businesses feel confused by the sheer amount of carbon jargon – undoubtedly compounded by the lack of clarity or a single reference document to decipher what net zero means for manufacturers.
Eighty-six per cent even believe that ‘net zero’ is in danger of becoming meaningless unless there’s consistency in approach and measurement among businesses.
This matters – businesses will have a major role to play in meeting the UK’s targets and delaying action could make an organization’s journey to net zero costlier or more difficult than it otherwise could have been. There is concern that this confusion and lack of clarity could leave some businesses behind.
Make UK contributed to the Cutting the Carbon Jargon report: Brigitte Amoruso, Energy and Climate Change Lead at Make UK, explains: “There are currently various ways to approach net zero, which is confusing, particularly as manufacturing businesses are at various starting points on their path towards it. Without a clear and consistent mandate and guidance from the Government, the net zero ambition risks becoming meaningless. Make UK stands ready to work with the Government, in line with the Committee on Climate Change’s (CCC’s) recommendations, to define a suitable approach for UK manufacturers.”
Forging a path to net zero
Clarity and guidance for manufacturers may be some way away, but organizations of all sizes can still take action to unlock the financial and environmental benefits of decarbonization.
Almost two-thirds of businesses expressed concern that their organization’s carbon reduction targets could be seen as jumping on the net zero bandwagon. Creating meaningful targets is vital but it is important that these goals are ambitious yet achievable. We recommend firms create Science Based Targets that demonstrate a meaningful contribution to climate action, including how quickly and by how much firms aim to reduce emissions.
As those organizations captured by mandatory requirements such as the Streamlined Energy & Carbon Reporting scheme (SECR) will know, getting a firm grip on emissions is vital to establish baselines, identify priority areas and set realistic targets for reduction. The Greenhouse Gas Protocol scopes 1, 2, & 3 enable businesses to build an accurate picture of their full emissions and the extent to which they can control them, creating solid foundations for reduction strategies.
The groundwork for major reduction programs takes time. Whilst industrial users will undoubtedly find opportunities become available – a £315m Industrial Energy Transformation Fund has already been announced to support energy intensive industries with the early adoption of energy efficiency and deep decarbonization projects, and the Industrial Decarbonization Strategy is expected in early 2021, but building the foundations for these major projects can begin now.
Whilst the Government undoubtedly needs to provide more clarity around net zero to make high level national goals into reality, firms can still begin their own journey towards decarbonization. Expert support is available to help organizations to create robust, enduring plans that stand up to scrutiny.
As we look to the future and consider how to rebuild from the impact of Covid-19, finding ways to unlock the financial and environmental benefits of emissions reduction should be part of any organization’s strategic plans.
Dan Crowe is optimization manager at Inspired Energy plc, the UK’s leading commercial energy and sustainability advisor. It offers expert assurance and optimization services to businesses to help them manage energy costs effectively and deliver their Net Zero, carbon and Environmental, Governance and Social (ESG) objectives