Pressure was mounting. With a $40 billion capital program reliant on fossil fuels, one North American energy company knew they had to tackle carbon emissions. As their long-time advisor in sustainability for more than nine years, they turned to Deloitte for help.
The risk was very real. Securities and exchanges were beginning to implement ESG screening and decarbonization has emerged as a global priority for institutional investors. Blackrock, the world’s largest investment firm, announced they would no longer allocate capital to companies without plans to lower emissions. Investors were pressing harder with questions about the increasing price of carbon and the impact on dividends. They wanted more than just a statement. They wanted action.
It wasn’t going to be easy. Making carbon a strategic priority means significant changes to operations, reallocation of capital to “green assets” and the potential for added costs to their customers. It would mean overcoming hesitancy by balancing urgency with credibility.
“Once, addressing climate change was just a compliance or marketing activity. Now it’s a matter of survival.” – Geneva Claesson, Client Lead Partner
But we had calculated the risk of doing nothing – a carbon liability approaching $50 billion. The answer was clear. It was time for this energy infrastructure company to begin their journey towards net zero.
In Phase 1 we investigated, taking the first ever detailed look at the company’s forecasted carbon emissions and the potential carbon exposure. Using our tool, the Decarbonisation Solutions™, we bridged the gap between climate science and financing. We modelled possible futures by pulling different levers such as operational efficiency and emerging technologies.
“While there’s more to do, the client has achieved the most important thing – lifting the energy transition and net zero to the top of their agenda.” Said Geneva. “They’ve shown investors they’re serious about change.”
Next is Phase 2, embedding net zero at heart of their business and strategy. We’ve helped the company develop detailed plans to reduce their greenhouse gases with near-term targets and a goal of pushing towards achieving net zero by 2050. We’re transforming their governance and processes, making sure they have the right structures to monitor progress and make long-term strategic decisions about their future. Crucially, our work is changing how they allocate capital and make investments, putting net zero first.
Throughout this green journey, we’ll be by their side. Championing. Supporting. And powering ahead to a greener, cleaner future.