- Increasing pressure from within – Pressure to reduce emissions is coming from within companies. Three-quarters (75%) of senior business leaders believe that pressure from their company’s board of directors to invest in renewable energy “extremely outweighs perceived pressure from customers, regulators and even NGOs.” ” or “significantly” exceeded.
- Acceleration to renewable energy – 62% of senior business leaders expect their organization's investments to shift from traditional fuels to renewable energy at an accelerated rate over the next 12 months.
- Solar power leadership position – Solar energy is the most popular investment technology, targeted by nearly three-quarters (72%) of respondents.
- Emergence of green technologies – Emerging technologies are becoming increasingly attractive and green fuels are becoming the most preferred.
- Market Diversification in the Energy Transition – The investor base is diversifying and a wide range of investors are looking to enter the energy transition market as its understanding deepens and the risks and opportunities become better known. I'm considering it.
- Identification of investment barriers – Investment barriers include lack of raw materials (identified by 41% of respondents), manufacturing capacity (40%), regulation (39%), and skills shortage (39%).
- Predicting more litigation – Legal disputes will continue to increase. More than two-thirds (68%) of respondents expect an increase in legal disputes related to the energy transition.
Companies are facing increasing pressure to deliver on their energy transition investment plans as stalled progress comes under increased investor scrutiny following a new investigation by global law firm Ashurst. The market is also becoming more dynamic as global companies explore a wider range of new technologies.
The report, Powering Change: Technologies Fueling the Future, now in its fourth year, brings together the views of more than 2,000 senior business leaders from G20 countries on the transition to low-carbon energy systems.
This study investigated attitudes towards the global transition to cleaner energy. It found that the private sector is overwhelmingly committed to driving change, with almost all respondents (95%) believing that investment in renewable energy, energy transition and clean technology will increase significantly over the next five years. We expect it to increase.
Despite ongoing global tensions and an increasingly turbulent geopolitical landscape, investing in sustainable energy remains at the top of corporate agendas. Interestingly, the impetus to invest in renewable energy and low-carbon technologies is felt most strongly from within rather than from outside the organization. Respondents reported feeling the most pressure from their company's board of directors and institutional investors (75% each) to invest in the transition.
As the renewable energy industry continues to diversify, mature and deepen, organizations are increasingly turning to non-generation options such as pumped hydro storage systems and smart meters to meet their transition planning goals. The study showed that the power generation market is also changing, with the focus expected to switch to offshore wind power. However, a range of emerging technologies took center stage, with 54% of respondents citing green fuels as the technology expected to mature over the next five years, followed closely by nature-based solutions (48%) and air storage. ing. and tidal generation (42% each).
The majority of respondents (81%) believe that investing in renewable energy is essential to the success of their organization's strategic growth, with solar energy currently the most popular target. Almost three-quarters (72%) of respondents said they are currently investing in solar power or have decided to invest in solar power. The optimism around renewable energy highlights that jurisdictions that develop appropriate regulatory frameworks are likely to benefit most from significant private sector investment appetite, but here there are important things governments need to do. There is still work left to do.
Responses suggest that businesses also need to plan for potential legal risks, with more than two-thirds (68%) of G20 respondents expecting to see more energy transition-related legislation in the next five years. 64% of European organizations agree. We hope for an increase. Areas of contention include greenwashing claims, litigation to block approval of energy projects based on environmental and social impacts, and issues related to asset decommissioning.
Michael Burns, global co-head of energy at Ashurst, said: “It's no surprise that those working in the energy industry expect the pace of change and investment in the energy transition to accelerate. The study highlights the lack of investment in the energy transition.” As the energy transition progresses and the renewable energy market matures, it is clear that there are significant opportunities for ambitious organizations when it comes to meeting the targets set by governments. It's a bold and strategic approach. ”
Dan Brown, global co-head of energy at Ashurst, said: “There is no doubt that directors, CEOs and other senior executives are increasingly focused on the energy transition amid increased investor scrutiny. “No. Leaders face increasing pressure from a variety of sectors.” As society's attitudes towards carbon emissions continue to evolve, balancing interests is complex and challenging, but we understand the challenges and opportunities the transition presents and are ready to act with confidence. Companies will be in the most advantageous position. They aim to succeed in realizing their ambitions and make great strides forward. ”
Read the full report here.