This contribution forms part of a series of articles which One Policy Place will publish in the next few days. We report from the European Business Summit which took place from 22 to 23 May in Brussels. Our articles summarise some of the sessions and detail the developments for policy and business which were highlighted by the speakers.
Sustainable Development Goals in the Energy Union – Business Solutions with Jean-Pierre Clamadieu, Solvay, CEO; Al Cook, Statoil, SVP Development and Production International, Adel El Gammal, EERA, Secretary General; Lise Kingo, United Nations Global Compact, Executive Director; Simone Mori, Enel, Group’s Head of European Affairs; and Maroš Šefčovič, European Commission, VP of the European Commission in charge of the Energy Union
The plenary session was opened by Maroš Šefčovič, the Commissioner for the Energy Union.
The Commissioner described the “Five D’s” for the Energy Union:
- Digitise the grids,
- Decarbonise and diversify sources of energy,
- Disrupt the traditional business models,
- Decentralise the infrastructure, and
- Democratise energy production.
We are currently undergoing the most profound transformation of energy systems since they were first built – in their centralised setting, based on fossil fuels – over a century ago.
The Energy Union does not have to stop at the borders of Europe, he said. Indeed, the African continent provides for the potential to implement new technologies, such as micro grids, since large-scale overland powerlines are not feasible there.
Clean energy is an “unstoppable movement” Šefčovič insisted, pointing out that the goal was not only to harness its potential in Europe, but also globally.
Lise Kingo from UN Global Compact shared that China had now begun a national carbon pricing scheme, meaning that around 25% of global CO2 emissions now fall under such schemes. Climate action is also a priority in China’s Belt and Road Forum.
The CEO of Solvay, Jean-Pierre Clamadieu, says that climate change was important to his company for two reasons – on one hand, they were contributing to it, but on the other, they were also part of the solution.
Manufacturing new materials – to produce lighter planes and cars, or more efficient energy storage technology – can make a difference. Solvay’s own commitment is to reduce 50% of its CO2 emissions over the next decade.
The company will achieve this by divesting from energy-intensive industries, prioritising energy savings and engaging in the fuel switch. For example, they have signed an agreement with Apple to ensure that only renewable energies are used in their production plants.
Clamadieu pointed out that corporations think long-term and are invested in combatting climate change. For instance, 30 CEOs of mostly US companies – including GE, Dow-Chemical and Dupont – signed a letter in mid-May, insisting on the proper implementation of the Paris Agreement.
Furthermore, Senior VP at Statoil Al Cook said that industry was engaging in long-term solutions.
Cook said that the private sector has to cooperate in schemes such as in the Oil and Gas Climate Initiative, which was a $1 billion fund to promote clean energy over the next decade. The challenge lies not only with renewables, but there also has to be work to make fossil fuels as carbon-efficient as possible.
In the UK, for example, carbon emissions fell to levels of Victorian times last year, through a combination of natural gas and renewable energy.
Enel was the first energy company in the world using digital technology – such as smart meters and digitised grids – to solve energy challenges. Simone Mori, Head of European Affairs at Enel, also highlighted the importance of engaging with the wider community, which was “core to [their] long-term vision.”
Another speaker, the Secretary of the European Energy Research Alliance, Adel El Gammal, said that “innovation, if properly managed and directed, was the only way to move ahead on energy challenges.” To “align agendas,” research is needed to transfer intellectual capacity to the industry. To get actors on the same page globally, a pragmatic approach is needed, such as the one that was used for the Moon landings.
A breakthrough in energy storage, for example, can dramatically accelerate the fuel transition – enabling cities to abandon fossil fuels instantaneously. Better energy storage is also the driver for the democratisation of energy production, one of the “five D’s of the Energy Union.”
A question from the audience on the EU ETS mentioned that the current carbon price was six times lower than the amount that would drive the transition – why was the EU ETS struggling?
The EU was a pioneer in introducing a carbon pricing scheme and the idea has been successfully deployed in countries such as Canada, South Korea and China, Šefčovič said. But he agreed that the current price does not drive the necessary transition.
In his opinion, the fairest system would be a global one. The Commissioner speculated: “We should read the price of carbon in the newspaper, like we read the price of oil today.”
Find more information on the ongoing ETS revision here.
Source: One Policy Place