AHC Group, Inc.
156 Stone Church Road, Ballston Spa, NY 12020 , U.S.A.
AHC Carbon and Innovation Working Group
- However inefficient the Paris Agreement may seem, it is a turning point on the climate issue. Smart businesses will now be forced to figure out how to prosper in this new world, and innovation will be, as it always is, a key to future success.
- Ken Strassner, AHC Group Senior Associate and Working Group Chair
Informed business decisions can now be made in the low-carbon economy. While volatility in the policy and regulatory environment has become normal, there is now sufficient clarity in global and national climate frameworks, and in meaningful reduction commitments adopted by companies and governments, to make informed business decisions on climate strategy both possible and necessary.
The electric utility industry is transforming and will continue to do so. The electric utility sector in the US, Europe and China has entered an irreversible process of transformation that is leading towards significant reductions in use of coal, installation of more distributed energy generation, a more integrated, data-driven and “two directional” power grid, and increasing emphasis on improving energy efficiency in industrial, commercial and residential facilities.
Disruptive innovation in carbon and energy will touch all aspects of the transportation sector. The transportation sector will also continue on its course of rapid and dramatic change with customers and regulators demanding continued innovation and increased efficiency in fuels/propulsion systems, more “semi and fully autonomous” vehicles, increased emphasis on intermodal shipping, and greatly expanded use of data to manage transportation functions.
Converging industry, market and regulatory forces will drive increased investment in industrial energy efficiency. Rising energy prices, expanded carbon trading systems and potential carbon taxes will dramatically increase financial returns from energy efficiency investments across the economy. Use of existing and new tools to measure efficiency gains such as Kaizen and the LEAN culture of continuous improvement will also expand.
Resiliency and adaptation to severe weather events will be an increasingly material consideration for business operations. The need for businesses to assess, plan for and adapt their facilities and operations to be able to deal effectively with more frequent and severe weather events, rising sea levels, and other impacts from climate change will also increase. Potential disruptions to supply chains, plant operations, product distribution, communication systems and personnel travel will need to be considered as part of this process.
Innovation in low-carbon products will be key to long term competitive advantage. To continue to be successful, companies must accelerate their pace of product innovation so that they can offer alternatives to conventional products, and new products, while meeting customer demands for low-carbon solutions with equal or better performance and price.
Sample Excerpts from Select Workshop Sponsors to Date
John Mogge, Director of Technology, Practices and Design, Environment and Nuclear at CH2M from Innovation & Climate Science: A Journey – “[L]ike the environmental era, the climate era will evolve but in a more rapid way due to convergence of sustainability, the inextricable linkages of natural resources to global economics and the advancement of climate science all leveraged with the exploding advancements of information processing technology”
Kevin Butt, Chief Environmental Officer, Environmental/Safety Engineering at Toyota Motor Engineering & Manufacturing North America from The Future of Cars and Car Manufacturing in a Carbon and Capital Constrained World – “Building a net positive culture within our business that creates more sustainable value than ever before, increasing customer loyalty, appealing to a new customer base, and increasing short/long-term profitability is our core challenge.”
Pete Trelenberg, Manager, Environmental Policy and Planning at ExxonMobil Corporation on The Dual Challenge for Exxon Mobil -“Ongoing progress poses the dual challenge of meeting the world’s energy needs while managing the environmental effects – including climate change – of energy use. There is no single or simple solution to this challenge.”
Scott Tew, Founder and Executive Director, Center for Energy Efficiency and Sustainability at Ingersoll Rand from Leveraging the Sustainability Advisory Council: Personal Findings -“Find a small set of sustainability challenges for the Council to focus on . . . focus the [in-person] meeting times [and] stick with it; incorporate the Council’s inputs at key points in the sustainability planning and decision process . . . Forging the sustainability story and advising on strategy are common tasks for these boards’ focus.”
Sandra Nessing, Managing Director, Corporate Sustainability at American Electric Power on Today’s State of the Electric Utility Industry- “A market transformation is underway and the electric utility industry [is meeting the challenge by] modernizing power infrastructure, focusing on the customer, and embracing an integrated grid. Agility and innovation are the name of the game.”
Bruce Klafter, VP Corporate Social and Environmental Responsibility at Flex on The challenge of decoupling economic growth from carbon intensity [in the electronics industry] - “[The key issues firms are facing are] disruption of existing industries, realignment of business models from production-centric to service-oriented, and the growing impact of ICT (e.g. server energy consumption) requires efficiency as well as procurement of low-carbon electricity.”