The world is striving to achieve a less carbon intensive future. There are a number of economic drivers pushing businesses and governments to adopt policies and technologies that will help reduce or eliminate carbon emissions. These include the business case, covered in this blog, as well as the investment and policy considerations for net zero carbon emissions, which we review in another blog.
Reducing carbon emissions is an essential step in mitigating climate impact, which poses a threat to both the environment and the economy. Inaction could have far-reaching consequences on weather events, rising sea levels and decreased crop yields. These impacts would affect businesses directly, through damage to property and infrastructure, supply chain disruptions and increased costs. In addition, climate change, and the effort to mitigate impacts, will indirectly affect businesses through increased regulation, higher taxes and reduced consumer demand.
Businesses have a responsibility to operate in a way that protects the environment and public health. Taking proactive action on climate impact can help businesses avoid risk and increase efficiency, while presenting opportunities to innovate and grow.
While the business case is strong, achieving net zero emissions will not be easy. Organizations looking to do so face three main challenges: technical, political and economic.
- Technical Challenges: Working toward a less carbon intensive future requires substantial changes in technology and infrastructure. Buildings must be retrofitted with energy-efficient systems, transportation needs to shift from vehicles powered by fossil fuels to electric vehicles, and power plants must move from coal-fired plants to renewable energy sources like solar or wind power. These changes are technically possible but require thoughtful evaluation, significant investment and time to implement.
- Political Challenges: A less carbon intensive future also requires political support at the local, state and federal levels. Policies are needed to encourage businesses to invest in clean energy technologies, regulations are needed to phase down fossil fuel use and subsidies are needed to make renewable energy more affordable for consumers.
- Economic Challenges: Many of the technologies required for achieving a less carbon intensive future, such as solar panels or electric vehicles, are still relatively expensive, leading to upfront costs associated with making the switch from traditional fossil fuel-based technologies. Some industries, such as oil and gas, are heavily dependent on fossil fuels, so making these transitions could result in job losses in these industries.
There are several holistic benefits of net zero carbon emissions that will benefit our world, but that also correlate with economic benefits.
- Reducing air pollution: Air pollution is a leading cause of death and disease globally, accounting for an estimated 7 million premature deaths each year. Switching to cleaner energy sources can help reduce this number. A study by the International Energy Agency found that reducing air pollution could save up to $2.9 trillion in health costs each year by 2030.
- Improving energy security: Achieving net zero carbon emissions would improve energy security, making us less reliant on imported fossil fuels. This would create jobs and boost economic growth, while increasing our resilience to supply disruptions and price fluctuations.
- Creating jobs and boosting economic growth: The transition to a low-carbon economy presents a huge opportunity for job creation and economic growth. A recent report by the International Renewable Energy Agency found that the global renewables sector already employs 9.8 million people, and this is expected to grow to 24 million by 2030. In the United States alone, it is estimated that transitioning to clean energy could create nearly 4 million jobs by 2030.
While there can be significant challenges associated with achieving a less carbon intensive future, it is important for businesses to understand them and begin planning how to address them. Organizations that do so can reap a number of benefits including lower energy costs, more reliable energy, improved brand reputation and increased customer loyalty. Reach out to EnTech Solutions today for support on your clean energy journey.
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