Barriers to Net Zero in the South West
Introduction
In early July, Kurb and Powrmatic brought sustainability leaders from across the region together at the fabulous voco Zeal Net Zero hotel to discuss exactly this. The intention was to facilitate an honest, transparent and respectful conversation that explored what needed to change to accelerate genuine progress towards a Net Zero region.
We invited sustainability leaders from a broad range of sectors, including public and private sector, and including both in-house experts and solutions providers to present a diverse range of perspectives on this critical issue.
This summary presents the key barriers identified, and suggestions from attendees on what they’d like to see change to allow the region to collectively achieve Net Zero across Scope 1, 2 and 3 emissions.
Recognised Barriers
Time Constraints and Competing Priorities
It was clear from the outset that stakeholders and decision makers were struggling to dedicate the necessary time to plan effectively for a more sustainable future. Organisations remain reactive to driving sustainability, waiting for equipment to fail, operations to become critical, or capital projects to become mature before asking how sustainability plays a role. On top of this, it was clear that competing priorities across finance, cyber risk and other business values are all competing for time and resource, often leading to Net Zero taking a back seat.
Language and Terminology
Sustainability, and even Net Zero, means different things to different people. It was recognised across the room that if we need decision makers and stakeholders to change their behaviours, we need to find a way of communicating key principles to them without new technical jargon, and with clear, consistent definition of certain terms. As sustainability professionals, we also need to learn to speak the language of those we need on board, which very often means communicating with reference to finance, risk and business continuity.
Shared Responsibility and Capacity
Sustainability teams are often small, many citing teams of 1-3 individuals even in organisations employing many thousands of people. This means the progress made by those in these teams is very finite, but there is often a view that achieving Net Zero sits solely with them. Atittudes need to change to allow for responsibility for sustainability targets to be shared across the region, with sustainability professionals acting as a strategic and supporting function to allow others to act effectively.
Cost Capital and Financing
There’s no getting away from it, Net Zero requires capital investment. Whether this be across grid infrastructure, renewable generation, travel infrastructure, or green innovation, Net Zero across the region will require cash injection. The current economic climate is making it hard to justify this investment for many, and sometimes governance and finance approval timelines can lead to significant delays, taking away any momentum for these projects. Scope 3 decarbonisation carries much lower financial investment, but where finance is needed across these activities (not always!), it tends to hit the business bottom line, making it even harder to get financial approval.
Policy and Political Volatility
The UK is in a state of political change. New leadership under labour is now guaranteed, and the whole political landscape is hitting business confidence. This uncertainty leads to much shorter-term planning, with businesses often hesitant to commit to long-term projects, even if there is strong confidence in the outcomes. Political stability is what gives business and public communities the confidence to invest in long-term solutions, including energy infrastructure, renewable generation, and interconnected public transport.
The Specifics of the South West
We deliberately asked our attendees about challenges they feel are specific to the southwest. Achieving Net Zero is a global and nationwide issue, but there are regional challenges that should be overcome independently, too. Here’s what was said:
Grid Capacity
It was made clear that grid capacity in the South West is a genuine barrier to electrification and renewable energy generation. Infrastructure that is well-designed for distributing energy to end users is not so well placed for taking energy generated as these locations. Significant investment, innovation and collaboration is required in these regions to overcome these hurdles if we’re to support the transition to electrified estates and electrified travel.
Transport and EV Infrastructure
Scope 3 emissions in our region are dominated by procurement and travel. The South West is a particularly rural setting, and whilst road networks connect are strategic locations, the region lacks a truly interconnected public transport and EV charging network that would genuinely unlock low-carbon travel options. Achieving this ambitious position requires willingness to act, capital investment, collaboration and innovation, but the commercial and environmental benefits of doing so would be huge.
Regional Fragmentation
Sometimes there is a lot to be said for simplification. The business and economic support landscape was noted as being particularly complex, which may be acting as a barrier to the necessary investment into the region. If together as a business and public community we could find a streamlined approach to investment and innovation that would bring significant confidence for those willing to take risks, the financial and capital barriers referenced in this report could be broken down more easily.
The Positives: What’s Already Working?
Reframing Climate Issues and Net Zero as Commercial Risk
There was a strong consensus in the room that communicating sustainability challenges with reference to climate risk to operations, risk to losing future business (from clients asking for sustainability credentials, and opportunity to raise investment through ESG-led portfolios is already getting a much more positive response from decision makers. We don’t need to reinvent the wheel here, we just need to be communicating the known benefits of Net Zero in a way that business leaders can resonate with.
Use of Evidence to Drive It Home
There are now countless case studies on the benefits of Net Zero, and the risk of not progressing this agenda. People love to see evidence before a decision can be made. Attendees in the room discussed many really positive stories, and many others exist outside of this room that should be shared widely to demonstrate why this should be a business imperative for south west-based communities.
Evidence that demonstrates the risks of inaction are also now widely available. Even this year the UK has broken records on rainfall in January, and temperature highs through June and now into July. The impact on business and the economy is tangible, and this evidence can also be used as a method to trigger action and collaboration. The South West is likely to be one of the most effected regions of the UK as the climate warms, so the need to act is felt even more strongly here.
Commercial Value from Sustainability
Attendees across the room recognised that Net Zero can bring commercial value via operational cost savings (especially for large energy consumers), customers satisfaction from larger, strategic customers, and talent attraction and retention. Investors are also continuing to use ESG as a metric for decision making under recognition that strong ESG credentials leads to better performance, so investment-led sectors should be considering how Net Zero plays a role in financing success.
Finding Future Solutions
We didn’t want this event to be simply an opportunity to moan, we wanted to make the most of the expertise in the room and find solutions to the barriers discussed on the day. Here’s what the attendees proposed:
Lead with language focused on finance and on risk, and try to remove complex, technical sustainability jargon wherever possible.
Build the case incrementally. Pilot new, innovative solutions, and measure their success to justify future expansion.
Lean on trusted advisors, case studies and business collaboration to find solutions that genuinely work for the region, and for specific business settings.
Push for a move to longer-term strategic cycles, especially across local government and for finance conversations.
Invest in grid capacity and low-carbon travel infrastructure for long-term, widespread benefits to the economy and local communities.
Educate from a young age the importance of climate issues, and the interconnection between climate, nature and the economy.
Despite the focus of this discussion being on Net Zero, it was strongly noted that the sustainability and ESG agenda should not ignore other critical topics, including conservation of nature and water consumption (a hot topic with new data centres being proposed for the region!).
“What If You Could Change Just One Thing?”
As a closing exercise, we asked each attendee to summarise what they would change to accelerate Net Zero across the region, if they could change only one thing. There was some consistency across the responses along the following themes:
Achieve long-term political stability across the region and across the UK as a whole.
Streamline grid connection for fast-paced rollout of innovative renewable energy and storage solutions.
Long-term, flexible funding availability for retrofit to existing estates.
A widespread culture shift that sees sustainability as a fundamental component of business.
Clearer routes to education and communication on Net Zero, and the benefits it carries to business, the economy and to local communities.
Strong investment in the skills needed to deliver on Net Zero, especially around low carbon energy and travel infrastructure.
What’s Next?
The event was a real success. It fuelled excellent, honest and transparent conversation. Real solutions were discussed. And, everyone left with a renewed sense of motivation and purpose as we all seek to achieve this vitally important common goal.
We’ll definitely be running similar events in the future, so if you’re interested in being a part of the next conversation please do reach out to info@kurbcarbon.co.uk – we’d love to have you in the room!
We’d like to extend a special thanks to voco Zeal, Exeter who were truly excellent hosts for the day – we’ll be back!