10.6 C
Manchester
Tuesday, May 28, 2024
Business supportNet Zero: What it is and why it matters to you

Net Zero: What it is and why it matters to you

‘Net zero’ is the new buzzword in the fight against climate change. Kevin Lambert, Resource Efficiency Lead at GC Business Growth Hub, explains what net zero means, where it came from and why all businesses need to sit up and take notice.

Over the last few months you may have heard the term ‘net zero’ in conversations about climate change. The government has even set a formal target to hit net zero in the UK by 2050. But what exactly does that mean?

What Net Zero stands for

Net zero is when the greenhouse gases we emit are reduced to the point where they can be balanced out by the greenhouse gases we remove from the atmosphere. In other words, it means no negative impact on the climate overall.

Climate scientists like to use the metaphor of a bath – if you pour in water faster than it empties through the plughole, the bath will fill up and eventually overflow. But if you balance the amount you put in with the amount draining away, by slowing down the tap and/or increasing the size of the plughole, then the water in the bath will remain level.

Net zero is also often known as ‘carbon neutral’, because greenhouse gas emissions are generally measured in CO2 (the most prominent greenhouse gas). You may even have come across the term ‘carbon negative’, which takes things one step further by removing more greenhouse gases from the atmosphere than you put in, resulting in a net positive impact on the environment. Some leading companies such as Microsoft are already moving in this direction.

But let’s not get ahead of ourselves – we’ll start with net zero.

What it means globally

In 2015, world leaders came together in Paris for a UN summit on climate change, formally known as a COP. Paris was COP21, and it resulted in an historic global climate agreement.

Nearly 200 countries agreed to take action to reduce their emissions in a bid to limit global warming to 1.5°C above pre-industrial levels. Climate scientists say the global community needs to reach net zero by the middle of the century at the latest for a reasonable chance of achieving this.

This is no mean feat. Global temperatures have already risen by 1°C, and we’re on course for 3-5°C unless more action is taken. Donald Trump infamously pulled the US out of the Paris Agreement when he became President, but Joe Biden has already committed to reinstating the US when he comes to power.

What it means to the UK

The UK became the first major country to set a net zero target of 2050 in 2019. Achieving this will require a complete transformation in almost all aspects of society. We will need to reduce emissions to as close to zero as possible by being far more efficient and intelligent in how we generate and use energy, how we consume materials and other resources, how we transport ourselves and our goods, and how we manage our waste.

We will also need to increase the amount of CO2 we remove from the atmosphere by changing the way we use land – for example by planting trees and restoring nature – and by developing new technologies that capture and store carbon from the air.

Much of this will be driven by national policy. The forthcoming ban on the sale of petrol and diesel vehicles is just one example of the sort of major government intervention we can expect over the coming years.

In 2021, the UK will host COP26. It will be the most important climate summit since Paris in 2015 and the UK’s presidency of the summit will put climate change front and centre of the government’s attention. We can therefore expect an increasing number of new climate-related announcements and commitments in the lead up to the summit in November.

What it means to Greater Manchester

The national target of 2050 is contested – many climate scientists, environmental groups and businesses would like to reach net zero much earlier. Several cities and city regions across the country have set their own, more ambitious, targets – including Greater Manchester, has set a target of net zero by 2038. Achieving this level of ambition will have far reaching consequences for businesses across the city region.

 

What it means to you

Ultimately, achieving much of what is required for net zero will fall on the shoulders of businesses. Urged on by consumers, shareholders, climate-related legislation and the risks of climate change itself, many of the world’s largest companies have already drawn up their own net zero plans. Often, these include targets far in advance of 2050. 

The number of corporate net zero commitments have tripled over the last year, in what has been coined the ‘Race to Zero’. At the time of writing, 1,541 companies with a combined revenue of over £8.5 trillion have formal net zero targets in place.

These net zero commitments will have a profound impact on supply chains. A 2018 survey by HSBC found that nearly a third of companies around the world planned to make their suppliers more sustainable in the immediate future. In 2020, the number of large-scale buyers asking suppliers for environmental data increased by 24 per cent.

Claire Scott, part of the Hub’s specialist Resource Efficiency team, has noticed a gradually increasing interest in net zero among SMEs as a result:

“While the net zero agenda is yet to penetrate into much of the SME community, we are beginning to see progressive businesses get ahead of the game by setting their own net zero targets. Showing leadership now will put companies in a strong position for the future by reducing risk, increasing efficiency and opening the door to new revenue opportunities.

“Net zero isn’t something to be jumped at. For those just beginning on their sustainability journey, it’s best to start small and build up from there. But net zero is the ultimate goal that all businesses will eventually need to deliver on.”

Fully-funded support is available to SMEs in Greater Manchester: Journey to Net Zero

Latest
Subscribe to our newsletter
Business Manchester will use the information you provide on this form to be in touch with you and to provide updates and marketing.
Don't miss

More News