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Perspective

Decarbonization road mapping

Decarbonization road mapping: Setting the pathway to a net zero future

Although highly diverse the Europe, Middle East and Africa (EMEA) region shares a common dynamic: the drive to decarbonize. Across the region there is an increasing urgency to create net zero energy, transportation and industrial systems.

The European Union has set out a strategy to become climate neutral by 2050, as has the UK. Among Gulf Cooperation Council members the United Arab Emirates has a 2050 net zero pledge, with Bahrain and Saudi Arabia making a similar commitment for 2060. A contiguous belt of Sub-Saharan African nations from Senegal on the west coast to Somalia in the east have proposed a net zero goal of 2050; as have many southern African states. South Africa itself has made a net zero by 2050 pledge.

The fuels of the future will increasingly harness natural resources like the sun, wind, waves and tides; working in conjunction with a rapidly growing suite of energy storage technologies. Increasingly, hydrogen is being recognized as a key element in achieving net zero.

EMEA’s investments in decarbonization will be multiple, will vary significantly in nature and scope, and will not conform to a one-size-fits-all strategy. Regardless, the most important and productive first step that any organization can do is create a decarbonization roadmap. Irrespective of revenue or size, the quality of an organization’s initial strategic decarbonization roadmap will have one of the most significant impacts upon the return on net zero investments and ability to compete and thrive in a decarbonized future.

Strategic road-mapping needs to encompass investments in energy efficiency, renewable energy and other new technologies. But a roadmap that focuses solely on technology is incomplete. An effective strategic decarbonization roadmap has to be multi-dimensional and address a host of other factors which will influence, and be influenced by, technology alternatives. Here are our five-steps to preparing an effective decarbonization roadmap:

  1. Identify the possible, accept uncertainty
    Getting started on a decarbonization roadmap can be complex. Decarbonization is a long-term undertaking — looking potentially up to 30 years into the future. To help manage this, the roadmap will need to identify low-hanging fruit, address the art of the possible, and also accept uncertainty. Adaptability has to be built into the plan, often with pre-set breakpoints to assess progress and reflect on changes and developments that will influence the roadmap’s future evolution. This approach avoids analysis paralysis in the face of demanding decarbonization targets.
  1. Technology at the core
    Decarbonization programs at all levels require an understanding of how legacy, new and soon-to-emerge technologies play together. A decarbonization strategic roadmap that lacks a detailed technology core will be insufficient.

    Roadmaps must combine business goals with high quality, accurate market and regulatory analysis; and first-hand expertise in decarbonization technology solutions in the power generation, power transmission, fuel and chemicals and transportation sectors. The most complete analysis will come from partners with expertise in strategic planning and the myriad technology solutions, including hydrogen and renewable energy generation, as well as the complex interfaces between these technologies. Such ingredients, addressed in concert will define successful decarbonization road mapping.
  1. Put technology into business and regulatory context

    Establishing which decarbonization technologies are best suited to delivering an organization’s decarbonization goals is inextricably interdependent on factors such as developing an understanding of organizational change and the relevant regulatory landscape. None of these elements in isolation will give rise to an effective strategic decarbonization roadmap. An authoritative strategy has to be multi-dimensional and address a wide range of business, performance, and CAPEX and OPEX considerations which will influence, and be influenced by, technology alternatives.
  1. Look to the horizon

    Roadmaps need to incorporate commercially ready and emerging technologies available over the next 30 years. This requires the technical competence and in-depth knowledge to identify technology timelines, cost curves, resiliency characteristics and prioritize technologies across multiple factors such as cost and returns, risk, availability and opportunity to scale.
  1. Get the right data

    Accurate data gathering is required to develop the base case assumptions that will be reflected in the roadmap. Initial data gathering includes assessing the organization’s supply and/or demand-side energy production/consumption and CO2 equivalent emissions, with the nature of the assessment depending upon whether the organization is pursuing scope 1, 2 or 3 decarbonization goals. This needs to be mapped to an assessment of the organization’s existing and future consumption activities and generating resources – including owned generation or power purchase agreements. The assessment also has to incorporate the organization’s fuel price projections and CAPEX and OPEX estimates

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