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Carbon neutral: catalyst for a 1.5°C future

By 2030, millions of inclusive jobs have been created globally in an economy rapidly gearing towards carbon management, low carbon industry and carbon sequestration. This opens new employment opportunities for those entering the jobs market, and also allows significant reskilling for those previously employed in less sustainable industries.

Global greenhouse gas emissions have almost halved from 2020 levels and the prospect of limiting the global average temperature increase to 1.5°C is within reach. Air and water quality in the leading industrial nations is better than it has been for decades and ecosystems are being restored, with a positive impact on health and societal wellbeing.

This is how.

Government efforts ramp up

Recognising the climate emergency and their responsibility to address it, a growing number of countries commit to reducing their national carbon emissions to net-zero, following the lead of the UK, European Union and China.

The USA recommits to the Paris Agreement to limit climate change and an increasing number of US states accelerate towards net-zero, following the path of climate champions such as California. Governments pass legislation and strengthen regulation, incentivising businesses to support national pathways to net-zero by decarbonising their operations.

We have helped the UK Government understand what needs to happen and by when to decarbonise heat. Read more

Companies act

In countries whose governments are slower off the mark, major companies have acted independently, shouldering their corporate responsibility but also seizing the opportunity to develop services, solutions and products that offer cost efficiencies, drive research and development, enhance their reputation and open new revenue streams. Momentum has been created to develop the skills, products and assets needed for a net-zero future.

Adoption of a systems approach that recognises inter-organisational and cross-sector connections and interdependencies, has revolutionised the way businesses tackle carbon neutrality. Skills in systems thinking have been rapidly developed and governance processes integrated in order to reduce inefficiencies and exploit synergies. This is complemented by the power of information management which enables businesses to make decisions on cost-effective approaches to carbon neutrality.

Decisions are routinely made on a ‘least regret’ whole-life carbon basis, as data collection and analytic capability has made scenario planning quick and accessible. Companies in developing countries that are not encumbered by old, carbon-intensive industries and infrastructure see the possibilities and benefits of pursuing low and zero-emission growth.

Even in infrastructure and manufacturing industries facing substantial capital and operational carbon challenges, many companies decarbonise their corporate operations to signal to their workforce and investors alike their intent to achieve root and branch carbon reduction. Businesses successfully embed the carbon neutrality agenda into staff engagement, such that employees understand why the changes matter to them and their families and have become advocates for the societal benefits they bring.

Great progress made by businesses drives wider public familiarity and acceptance of the need to reduce emissions from travel and heating. This is supported by a market geared to providing low carbon solutions, and clear cost savings encourage more citizens to tackle their emissions.

Leading the way to net-zero emissions. Read more

10 steps to becoming carbon neutral

Financial sector spurs businesses on

Investors, lenders and insurers have minimised their exposure to climate-related risks by divesting from carbon intensive businesses in favour of those aligned with a net-zero future. Financial industry preferences and decisions are also shaped by the generational rise of millennial investors who grew up green.

Investors appreciate that low and net-zero carbon businesses are more sustainable, efficient and agile than competitors still reliant on unmitigated fossil fuels. Divestment from carbon intensive businesses is made easier by increasing demand for carbon disclosure.

The Task Force on Climate-related Financial Disclosures (TCFD) was set up by the Financial Stability Board to encourage consistent reporting using comparable metrics on carbon emissions, future targets, action on climate risks and alignment with the Paris Agreement.

By 2030, the world’s leading large and medium-sized companies are using TCFD principles to drive down carbon. This is a major increase on the 1000+ global organisations, valued at US$12trn, supporting the TCFD in 2020.

Financing climate resilience in the developing world. Read more

How the financial sector is playing a crucial role in pushing the decarbonisation agenda

New services and businesses emerge

The fast-changing business environment creates the conditions for a burgeoning carbon management industry that includes carbon footprinting, certification, offsetting and accreditation, supported by digital technology, advisory and management consultancy services.

Digital innovation is important for enabling organisations to understand their direct and indirect carbon emissions from diverse offices, assets, products and activities, and to track carbon throughout supply chains. Technical, advisory and change management services provide organisations with the know-how to begin or accelerate their carbon reduction journey, guiding leaders, building capability and capacity, setting strategy, developing plans and establishing metrics.

Carbon capture delivers co-benefits

Companies’ need to offset their residual emissions has created burgeoning ‘natural capital’ enterprises worldwide, specialising in the restoration or enhancement of forest, grassland and peat ecosystems that sequester carbon from the atmosphere.

As well as mitigating climate change, these nature-based solutions play a role in adapting to more severe and frequent physical impacts of climate change – they attenuate water, provide cooling and stabilise land, for example. Habitat creation together with reduced pollution pave the way for a resurgence in biodiversity and the sustainability of previously endangered natural habitats, such as those that exist at the polar ice caps and great barrier reef. This in turn boosts the wellbeing of local people and stimulates tourism, bringing new sources of prosperity.

Entering the 2030s, significant progress has been made in artificial ‘direct air capture’ (DAC) solutions and bioenergy linked with carbon capture and underground storage (CCUS). They are expensive but important in assisting the ongoing sequestration of atmospheric carbon. However, the rising cost of offsetting incentivises businesses to keep cutting carbon emissions. The growth of offset schemes is supported by a radically different approach to land use being implemented worldwide. Improved agricultural techniques, better land management and widespread dietary change – with a move away from carbon-intensive meat and dairy – has meant large swathes of land have been released for other uses, including reforestation and ecosystem restoration.

Capturing carbon at the Sumatra Merang Peatland Project. Read more

Travel and transport are reconfigured

Technological solutions mean that the vast majority of motorised modes of transport are powered by green energy, including battery electric vehicles, hydrogen power and biofuels.

There has been a revolution in active travel with the growth of walking and cycling during the 2020 pandemic sustained and supported through shared ridership schemes and investment in active travel infrastructure and pedestrian-friendly streets. Investment in travel demand management in big cities, designed to reduce congestion and emissions, has evolved to focus less on the means by which people choose to travel and more on the need to travel. Choice is central to travellers’ decisions, while a more efficient transport system is developed through ‘triple access’ planning, which considers land use and spatial planning, physical mobility and digital connectivity.

Energy sector transforms

Aligning with the Intergovernmental Panel on Climate Change (IPCC) recommendation that global emissions must be halved by 2030, the global energy sector rapidly moves to low carbon energy sources and away from unmitigated fossil fuels.

There are country-specific plans to decarbonise the energy sector according to economy, geography and legacy systems.

Green energy is an ‘easy win’ for organisations plotting a carbon neutral pathway. Businesses buy renewable and low carbon electricity, creating a surge in offshore wind and solar PV installation, and accelerating the approval of permission for new nuclear and hydropower capacity. Peripheral technologies such as geothermal and tidal electricity generation gain a more substantial foothold.

Breakthroughs in hydrogen fuel cell technology and improvements in the energy density of batteries increase the range and power of electric vehicles, enabling organisations to green their corporate car, van and truck fleets. Rail systems and trains are converted to electric and hydrogen propulsion and sustainable aviation and maritime fuels are widely adopted in the shipping and logistics industries. In the mid-2020s work begins on upgrading key parts of national and local gas transmission, storage and distribution networks to allow the replacement of natural gas with hydrogen. Hydrogen boilers alongside ground source heat pumps and electric power meet the thermal comfort needs of workers in offices and industrial workplaces.

The focus on carbon has highlighted a major inefficiency – and a major saving/revenue stream – in lost and wasted heat. Energy companies have started to install heat network infrastructure to connect buildings and infrastructure in cities, enabling excess heat to be transferred to areas in deficit, or stored in heat ‘reservoirs’ until needed: they are buying and selling thermal energy. The same is true for adoption of technologies such as pumped storage and compressed air energy storage (CAES) to ensure network stability and reliability as dependence on intermittent renewable generation increases.

Cutting carbon with the 2050 Calculator. Read more

Guiding global resilience: Supporting the World Bank’s climate resilience and natural disaster guidelines for the hydropower sector

We’re leading a consortium on behalf of UK government to support the development of innovative clean energy technologies.

Building and upgrading for performance

The building sector is an early adopter of high-efficiency design for manufacture and assembly (DfMA).

Factory-based production of building modules enables high levels of thermal performance and materials efficiency to be achieved. DfMA allows for rapid construction and easy building adaptation – the improved welfare and safety of those involved in manufacture and assembly processes further encourages DfMA adoption. From the mid-2020s onwards, for buildings constructed using the technique, it contributes to improved performance against all criteria, including energy and carbon savings.

For the majority of organisations, new build isn’t an option but an energy efficiency retrofit becomes increasingly attractive. From being a small construction industry niche, retrofit becomes a major activity with a diverse, innovative and capable range of advisory, design and specialist contracting services, supported by a growing list of low and zero carbon products, including low carbon heating and cooling systems.

How our refurbishment delivered a 70% reduction in building services energy use at a London university building. Read more

Our borehole cooling system at The Laboratory, Dulwich College is four times more efficient than conventional air conditioning.

Reduced wastage and increased efficiency have long been arguments in favour of design for manufacture and assembly (DfMA).

Circular economy comes of age

Regulations and financial incentives push companies towards embracing the circular economy, with products and materials reused and recycled rather than sent to landfill or used to produce energy from waste.

In the infrastructure and built environment sectors, this means a fundamental rethink of the way we plan and design assets so they can be adapted, added to, dismantled and re-assembled, and operated and maintained with greater efficiency. This affects procurement, with businesses increasingly specifying for the full lifecycle, and suppliers competing to provide products which have value after decommissioning or disposal. Alternative payment models such as ongoing licenses or ‘pay-per-use’ replace one-off fees, reflecting long-term partnerships with suppliers.

Disposing of waste becomes increasingly expensive, difficult and reputationally damaging, while those that embrace circularity unlock innovation, increase efficiency and decrease risk. The recovery and re-use of materials and components is aided by digital tagging and detailed building information models/digital twins.

Enabling net zero through the circular economy. Read more

Our modular sporting venues for the 2012 London Olympics can be fully dismantled and reassembled where needed.

Forward momentum

Although there are still significant capital and operational emissions challenges to solve in infrastructure, industry and agriculture, by 2030 success in tackling corporate emissions has generated huge forward momentum and an appreciation of what it will take for whole industries, and even countries, to become net-zero.

It has been confirmed that the goal of keeping global warming within 2°C of the pre-industrial average temperature is achievable if we act now and with commitment – and beneficial for business and the economy, as well as society and the environment.

Carbon neutral: catalyst for a 1.5°C future

This is the future