This article clarifies what net zero means and explores how companies can take advantage of using data and setting metrics to achieve net zero.
What is net zero?
Greenhouse gas (GHG) emissions released by human activities are known for causing global warming. When these emissions are counterbalanced by the removal of GHG of an equal volume, we can say we have achieved a net-zero emissions balance. Simply put the definition of net zero implies that something or someone cannot emit to the environment more carbon dioxide than they’re able to absorb.
Who determined net zero?
The acceptable temperature rise was a societal choice guided by science. The 2015 Paris agreement on climate change, which was ratified by 196 signatories, requires countries to limit their contributions to average temperature increases well below 2 °C, and make efforts to limit it even further to below 1.5 °C.
One way countries can meet these goals is to set their peak greenhouse gas emissions within the coming decade, and gradually achieve a national net zero by 2050.
This would leave, by 2050, a remaining carbon budget of 400-800 GtCO2, depending on the scale and cost of the required emission cuts needed along the way.
Compliance with the Paris agreement has been limited so far, but as governments triangulate nationally determined contributions (NDCs) based on this shared understanding, we hope to see progress towards a safer climate future accelerating.
Ways toward net zero
Opting for electric
Lord Adair Turner, former head of the UK financial regulator and now co-chair of the Energy Transitions Commission, has called for a dramatic increase in investment in clean energy, arguing that such expenditures would be an economically sound decision for governments around the world.
A strong argument in his support is the astonishingly rapid progress in the development of solar energy technologies. Solar power can now be delivered for as little as 2 cents per kilowatt-hour – These are the lowest prices for electrical power ever achieved from any source. This remarkable engineering accomplishment, and others like it, will hopefully light the path toward renewable energy.
Hydrogen has been a long-standing dream of clean-energy advocates because it has the potential to produce energy with water as the only byproduct. In recent years, climate change has made it a favorite of oil companies, steelmakers, airlines, and other industries that are under pressure to reduce their carbon emissions. Further fueling advancements in wind and solar power, it is now possible to produce green hydrogen.
‘Green hydrogen’ is the process of splitting water molecules (H2O) into hydrogen and oxygen. Crucially, the ability to fuel this reaction with renewable energy significantly reduces the carbon footprint, compared to ‘grey hydrogen’ that uses methane and coal in the process.
Using data strategy to reach net zero
When it comes to driving a net zero transition, and with so much at stake, it takes facts and figures to drive change. The better the data at the disposal of climate-change advocates, the better they are able to educate stakeholders and convince them to undertake the action required.
Data is increasingly proving the harsh realities we’re already facing due to climate change, and also to show the extent of the impact humans are likely to have on future global warming, if left unchecked. When information is shared with investors and with those we entrust to protect our environment for future generations, it can act as a motivator for change.
Step 1 – Find the right systems and processes
Find the correct systems to collect, analyze, and report accurate data to fully understand where emissions are created and how they can be reduced. Using carbon data systems makes it easier for you to compare your data and ensure that it’s all coming together through an integrated business intelligence service.
Step 2 – Track your progress comprehensively
Managing data has never been easy. And with the intense scrutiny of work today, there seems to be a steadily increasing volume of data that needs to be processed, simply to maintain the existing status quo.
This is why companies should look at consolidating data systems into comprehensive platforms that are able to analyze data holistically and in real-time. Relying on such tools and applications to monitor emissions, and understand all the variables playing into their production, is key to gaining control over them.
Step 3 – Mind the costs
When setting goals for the reduction of carbon dioxide, many different initiatives are often involved and costs should be factored in. Setting projections accurately to account for the changing energy landscape is important because it highlights the different ways to reduce carbon dioxide emissions effectively and economically – without sacrificing the bottom line.
Benchmarking net zero emissions
The Science Based Targets initiative’s (SBTi) Corporate Net Zero Standard is the first science-based initiative for Non-Financial Reporting as it relates to companies of any size setting targets that are consistent with limiting global temperature rise to 1.5°C.
Companies that adopt the SBTi’s Net Zero Standard must pursue science-based targets across the board. The SBTi requires companies to set both short and long-term targets to reduce their emissions all along the value chain:
- Scope 1 – Emissions by internal processes
- Scope 2 – Emissions from energy and power procured.
- Scope 3 – Emissions generated by suppliers and end consumers.
The Net Zero Standard requires that near- and long-term science-based targets should be established. Near-term targets cover immediate emissions reductions for the next 5 to 10 years, while long-term science-based targets determine the goals for decarbonization by 2050, or before.
In today’s climate of rising temperatures and increasingly unpredictable weather patterns, environmental concerns are an increasingly primary concern for decision-makers in every sector.
Better aggregation and analysis of relevant environmental data will continue to rise to the top of corporate agendas worldwide and in companies of every scale. Businesses that fail to step up today with more effective, data-based, and streamlined processes will find themselves lagging behind tomorrow when it comes to growth, efficiency, and risk mitigation.