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Businesses, not governments, will need to lead the transition to clean energy, executives say

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Speakers on sustainability at PwC's Trust Leadership Institute in December 2022.Joan Motsinger from Seagate and Jamie Gamble from PwC talked with Insider about the role of business in addressing the climate crisis.


  • Getting companies and consumers to be sustainable will require transparency, cooperation, and trust.
  • The transition to clean energy isn’t a choice, executives told Insider.
  • The net-zero shift must be “affordable, safe and reliable, and clean.”

The US is about a decade behind where it should be to reach some of its net-zero goals. To make progress, business can’t wait for the government to fix the problem.

That assessment came from Joan Motsinger, the senior vice president of sustainability and transformation at Seagate, a data-storage company, in a recent discussion with Insider at PwC’s Trust Leadership Institute. 

Getting boards, employees, and, finally, consumers to agree to and then implement strategies, adopt new technologies, and use more-sustainable products isn’t easy and will require a high level of trust, transparency, and cooperation, Motsinger and two other executives told Insider.

Motsinger and Kevin Fitzgerald — the chief utility officer at Energy Impact Partners, a venture-capital firm focused on sustainable energy with more than $3 billion in assets under management — had a conversation at the Trust Leadership Institute with Jamie Gamble, a PwC managing director, on shaping strategies around sustainability and the importance of transparency. 

The professional-services firm runs the Trust Leadership Institute — which aims to help C-suite and senior-level executives and directors think about the evolving and increasingly complex role that trust places in business, including public policy, data and technology, cybersecurity, workforce management, governance, and sustainability. The institute is part of PwC’s $300 million commitment to push leaders to embed trust-based fundamentals into their day-to-day and long-term management styles and business practices. 

Motsinger said the move to sustainable business practices, infrastructure, supply chains, and products couldn’t wait for the government to mandate such moves.

“Businesses are going to have to lead in the collective,” she said.

Some investments in the economic transition will be home runs

Gamble told Insider that leaders should think of the shift to net zero not in terms of cost but of investment. 

Fitzgerald agreed: “We’re investing, not driving up costs,” he said, adding that sustainable products and services had to be “affordable, safe and reliable, and clean.” 

Of course, a change of this scale will be costly. Fitzgerald pointed to one estimate that it would take $9.2 trillion in annual investment to transform the global economy to net zero by 2050.

Motsinger is concerned that many people are taking too long to understand the threat posed by the climate crisis. Fitzgerald added that it’s key to develop trust among all sides so that businesses could roll out new technology. 

Gamble noted that in any industry or transition, such as what’s needed to tackle the climate emergency, there will always be investments that fail. 

Yet that risk might not put off some investors. Fitzgerald said there were hundreds of billions of dollars that venture firms wanted to invest in sustainable startups, projects, and technology. Some of these investment areas are proven, while others aren’t ready to be commercialized and are higher risk, such as zero- or low-emitting aviation fuel.

“It’s worth the bet because if it works, it’s a game changer, but it’s a high-tech risk. If it goes to market and fails, then they need to move on,” Fitzgerald said.

VC funds are looking at sustainability projects and startups for one to two home runs out of 20 to 30 swings, Fitzgerald said. Many of these technologies have to be deployed by 2030, and some, like clean electricity across an upgraded grid, are high priority. Once we have safe, reliable, and affordable options in those areas, Fitzgerald said attention might turn to areas considered harder to decarbonize — processes like steelmaking, cement production, and construction. 

Technology is key to progress in sustainability

There are bellwether industries that will help tell the world how well things are going, Fitzgerald said, citing transportation. In the future, electric vehicles will likely dominate the roads, yet there are many questions about how we’ll get there.

The US electrical grid will require a major overhaul to deliver sufficient power for charging EVs. Fitzgerald said a passenger plaza along a highway serving cars and trucks could require enough electricity to power a small town.

“How much capacity do we have on the grid for that?” he said. “What kind of infrastructure needs to be built around that? What kinds of chargers do we need? And can we roll those out quickly?”

While the transition of transportation to electrification is in its infancy, it’s a great space to watch to see how the implementation of clean energy is going, Fitzgerald said. He added that investments in areas like battery-storage tech and even software for battery storage would serve as indicators of how quickly the US might reach its climate goals.

“It may be bumpy,” he said.

Fitzgerald said the technological evolution of many of Energy Impact Partners’ companies and how far they’d come, and what’d been deployed for wider use, “shows that this can be done.” But he added that as the world accelerated the clean-energy transition, issues would arise. There needs to be a continued focus on reliability and affordability for this to work.

“I have faith in innovators and faith in technology,” Motsinger said, particularly because investors are putting money into more sustainable technologies and standards.

Gamble said the transition wasn’t a choice: “The world has moved, and leaders have to react to it in a positive way and creatively think.”

Read the original article on Business Insider
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