The Corona Effect: will it slow down or advance net zero?

15th June 2020
Decarbonisation

Richard Burrell, Chief Executive of AMP Clean Energy

The ongoing economic fall-out of the Coronavirus has been well documented. Large corporates to SMEs now find themselves having to prioritise their long-term financial future over everything else. With corporates leading the net zero charge before the pandemic hit, will business now drop or pick up the mantle once more?

This has been a period of enormous upheaval and change but there have also been huge positives for the environment. Carbon emissions have dropped dramatically, and we’ve seen illustrious images of clear skies over major cities, dolphins in Spanish marinas and clear water in Venice canals. The sharp rise in cycling and walking has been accompanied by a subsequent reduction in driving and using public transport. The UK has now gone more than two months without burning coal to generate power, a major clean energy landmark.

These are all positive side effects of a pandemic which has largely forced us to stay at home. What the Coronavirus has shown us is how quickly we can adapt to new circumstances. If we had been told a year ago that we would move to a remote working model, we would have spent six months planning for this major change. However, we all re-organised ourselves in a space of a few weeks. The lockdown has demonstrated that we can accommodate new ways of living and working, which we can translate into achieving our net zero ambitions.

What is evident to me is that millennials do not want to work for businesses that aren’t contributing to societal goals. We need all businesses – big and small – to sign up to a decarbonisation journey in order to appeal to customers and stakeholders. If organisations don’t make progress on sustainability, they risk becoming obsolete. In other words, not seeing to be taking the net zero agenda seriously, will represent an existential threat to a business. From a strategic perspective it’s not about whether decarbonisation initiatives cost your business an extra £100k per annum or saves it £100k per annum, it is simply something you have to do to survive. Therefore, sustainability must rank alongside health and safety as critical functions in business planning and risk management.

Net zero is still very much on the corporate agenda. A recent survey conducted by Future Net Zero showed that 74% of corporates didn’t think COVID-19 had put back their sustainability plans and 78% believed that business should lead the net zero challenge. However, to reach net zero emissions, we must urgently tackle heat decarbonisation which represents around 40% of the net zero agenda. The electrification of heat and a mix of established and emerging technologies can deliver effective heat decarbonisation, but the Government must now put this centre stage.

But what about the financial capital required to invest in, and develop, the new energy infrastructure? As a specialist developer, operator and financier, our experience at AMP Clean Energy is that investors are keener than ever to fund decarbonisation projects. However, some businesses, who may have been planning to finance their own on-site energy projects, will now be focused on repairing their balance sheets. That’s where AMP Clean Energy can help businesses by providing 100% of the funding required to ensure the continued deployment of low carbon infrastructure on a massive scale. As a long-term developer, operator and financier, we are an ideal partner for businesses, and we see our role in this journey increasing dramatically post Covid-19.

The momentum for net zero was very strong before the Coronavirus crisis, and that passion and desire is still very much alive. Covid-19 may have presented a bump in the road, but we have travelled beyond being diverted, even by something as disruptive as this pandemic. If anything, Covid-19 has brought us closer to net zero. It has shown that we are resilient and adaptable, because we’ve all had to look closely at what we really need to do to run our lives. In the post Coronavirus world what better way of protecting ourselves than by ensuring growth is sustainably led, enabling our planet to be ready for its long-term future?