Growing commitment to a net-zero future

One of the most striking and encouraging trends I’ve seen through this current phase of the COVID-19 pandemic is the continued growth of corporate commitment to address climate change.

Within just the last couple of weeks, two of the world’s largest oil and gas companies, Shell and Total, set goals of reaching net zero carbon emissions. Duke Energy, one of the nation’s largest power companies, laid out a plan for reaching its own net-zero targets. And Barclays shareholders overwhelmingly endorsed the UK bank’s plan to be net zero by 2050.

Other recent examples were highlighted during C2ES’s April 29 webinar Implementing Net Zero Commitments, where representatives of Shell, Duke, BP and Microsoft outlined their across-the-board efforts to shrink or eliminate their companies’ carbon footprints.

Sarah Adair described Duke’s plan to greatly expand its use of renewable energy and other zero-emitting resources such as advanced nuclear and long-duration energy storage. Michelle Patron described Microsoft’s plan to be carbon negative by 2030 and to remove all the carbon the company has emitted since its founding by 2050. The plan also includes launching a $1 billion fund to advance carbon reduction and removal technologies.

These companies, of course, all recognize that our most immediate priorities are containing the coronavirus and restoring the economy. There are many near-term opportunities to advance both economic recovery and climate solutions, as outlined in the recommendations to Congress that C2ES released last week.

But even amidst the current public health crisis, a growing number of companies are demonstrating that they understand that their long-term interests – and society’s collective long-term interests – require ambitious, sustained efforts to tackle our historic climate crisis.

In late April, BP CEO Bernard Looney said that despite having to make cuts elsewhere, the company will leave its “$500 million of low-carbon investment unchanged (and) untouched this year.” Looney underscored BP’s net zero commitment and highlighted, in particular, the  attractiveness of solar investment given the sector’s resilience and risk profile.

On a recent call with analysts, Shell CEO Ben van Beurden said that the company’s decision to cut its dividend for the first time in 70 years will create opportunities to invest in emissions reductions. He said the low-carbon energy transition could even accelerate during the coronavirus recovery and the company should be well-positioned for that shift.

In announcing Total’s commitment to net zero emissions by 2050, Board Chairman Patrick Pouyanné noted how technology, climate change, and social expectations, including the European Union’s net-zero commitment, are transforming energy markets.

The European Alliance for Green Recovery, an influential group of CEOs and ministers, described the current moment as “an opportunity to rethink our society and develop a new model of prosperity.” The alliance called for a “more resilient…more inclusive” economic model built on “Green principles.” The group includes businesses with net-zero commitments including Unilever, Nestlé, and Saint-Gobain.

Lastly, global investors are pushing big economies to implement sustainable recovery plans. In early May, the Institutional Investor Group on Climate Change and other leading financial organizations warned that “Governments should avoid the prioritization of risky, short-term emissions-intensive projects” and called for clear, long-term policies that reflect a pathway to a net zero global economy.

The coronavirus pandemic is causing enormous pain, and we will all need to work together for months and perhaps years to come to heal our economy and our lives. It is heartening, though, that even in the face of this unprecedented challenge, many of our leading companies remain steadfastly focused on the great collective challenge of our time, tackling climate change.