CARBON REDUCTION
Utilities
The utility sector is responsible for a vast quantity of carbon emissions,
and it also has a fundamental responsibility to the general public in
terms of leadership, writes Jamie Curry
CALL OF
DUTY
I
n the global attempts drive down emissions, to get consumers thinking about climate report to investors in terms of emissions, fuel
it is business that bears the biggest responsi- change. And it was also the day that a new mix, reduction plans and potential risks. Fifty
bility. And it is the activity of business that publication came out, revealing just how three percent of them responded (which,
can have the greatest impact. Of course, con- badly the world’s utility companies are per- although low, is an improvement on the 44%
sumers can do their bit. In fact, if the world is forming on climate change. responding to the same request in 2006),
to reach the point where temperatures are sta- According to the Carbon Disclosure including just three Chinese firms and one
bilised, everybody will have to do their bit. Project’s (CDP) latest Global Electric Utilities Indian. The response is alarming, especially in
But one sector the general public will report, only a small fraction of the world’s the context of the report’s introduction that
look to for leadership on climate change is the utility companies are actually taking their car- argues “the world’s electric power industry is
utility sector. Our power companies are huge bon emissions seriously. Just half of compa- poised at a transformational moment…
emitters of greenhouse gases, yet many of nies surveyed bothered responding to an [which] within two decades must complete a
them are consumer-facing – able to influence investors request for information on emis- thorough overhaul of its power generation
the agenda and effect behavioural change at sions, and just 16% of utilities are actually set- system and transmission network”. According
the same time. But are they doing that? ting and disclosing absolute emission reduc- to the International Energy Agency, this will
On 22 April, the world celebrated Earth tion targets. The CDP asked 249 companies require a “rapid transformation to a low-car-
Day – a global awareness initiative, designed within the sector for information that they bon, efficient and environmentally benign sys-
tem of energy supply. What is needed is noth-
ing short of an energy revolution.”
MEANWHILE AT THE WORLD BUSINESS SUMMIT ON CLIMATE CHANGE
Concern
While the utility firms need to up their game, a new coalition of companies is urging What is of most concern is the lack of data on
governments to take leadership in order to stimulate a low-carbon economy the power companies’ generation fuel mix,
which can offer an insight into the likely
Global business leaders are calling for framework. “The creation of a low-carbon impact of future climate change regulation;
governments to take firm and decisive economy remains at the heart of the those still relying heavily on coal are obvious-
action through both policy incentives and international business agenda, in spite of ly more exposed than those that have devel-
practical steps to reduce carbon emissions. the worldwide recession,” says AEA oped renewable-energy facilities.
Fifty-eight firms, including Centrica, Ford operations director Robert Bell. The perceived lack of interest from the sec-
and Nissan, were surveyed by the Carbon “The business community wants tor “raises the question of how much utilities
Disclosure Project and AEA Technology to governments to put in place an are willing to pay to cut their emissions – or
understand how current economic internationally recognised, regulatory pass costs onto customers – as emissions trad-
conditions will impact the essential framework in which we can cut carbon ing schemes and/or carbon taxes come into
business transformation to a low-carbon emissions consistently and effectively play,” says Doug Cogan, the report’s lead
economy. The report found that 97% of across the planet.” author and director of climate risk manage-
senior management sees government Among the most popular recommen- ment for RiskMetrics Group. “Improved dis-
intervention as the key driver in ensuring dations were tax incentives and grants for closure on forecasted capacity and production
the stimulation of a low-carbon economy. the deployment of low-carbon would help investors to better assess exposure
In fact, there is significant demand from technologies. For example, Centrica said to such carbon limits at this pivotal time in
companies for government to push for a that “government is relying on the private national and global climate regulation.”
low-carbon economy on an international sector to deliver much of the investment Analysts Trucost assessed a number of
level and to create markets that can work needed to meet our climate change the utility firms surveyed by CDP, in an
in the same globally recognised targets.” attempt to offer the investment community a
picture of a company’s net contribution to
24 June 2009 ❘ Sustainable Business
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