Organisations divided on how best to achieve net zero states survey

Research from Siemens Smart Infrastructure indicates a significant divide in opinion about how best to reach net-zero targets, with fewer than 50% of organisations expecting 2030 targets to be fulfilled.

According to data from the report, Siemens Infrastructure Transition Monitor 2023: The Great Divide on The Path to Net Zero, with only 40% of organisations expecting to reach decarbonisation targets this year, there is an alarmingly limited alignment on priorities.

Although more than half of people surveyed believe the infrastructure transition is accelerating in their region, a quarter of participants – senior executives from seven major industry groups – said that progress is “too slow”, while 29% believe progress is “coordinated” and 31% describe it as “on target”.

The guiding principles behind the research outlined in the report include; the necessity of the infrastructure transition to have a positive impact beyond decarbonisation, smarter infrastructure integration is mandatory to affect change, and action must be undertaken urgently and at top speed to avert disastrous global consequences.

Regional change not fast enough

According to the Siemens net zero report, less than 10% believe their region (or country) to be “advanced, fully integrated, full-scale” on major energy goals of the transition.

Citing McKinsey findings, Siemens states that decarbonising the world’s energy system would require an estimated $275 trillion with regulatory authorities seen as having the greatest responsibility, according to 31% of respondents.

This is closely followed by the ultimate owners of assets, investors and shareholders, according to 25%. Businesses (17%), politicians (13%) and citizens (13%) are all described as having some responsibility, but significantly less.

Decarbonisation is a competitive advantage for cities

In the survey, half of respondents (51%) believe that being ahead in decarbonisation is a competitive advantage for a city.

45% of respondents feel their cities have made progress to encourage the use of public transport. However, according to the report, 44% also believe that the privatisation of public transport would speed up decarbonisation.

In terms of feasible mobility policies, 46% of executives believe that subsidies or taxes should be used to make electric cars cheaper than combustion engine vehicles.

Currently, the lack of charging infrastructure was found to be the biggest barrier to widespread adoption of electric vehicles.

40% of organisations expect to reach 2023 decarbonisation targets this year

Businesses are under pressure to decarbonise their business models, assets, and infrastructure.

According to the report, nearly half have targets for Scope 1 and 2 emissions (47%).

Only 40% think it is likely that they will meet their targets for the year ahead and just 44% expect to meet their 2030 targets. The report indicates that there could be a correlation between confidence in organisational growth prospects and confidence in decarbonisation targets.

Another key area of consideration for businesses is their buildings. Only 37% of respondents rated their organisation as mature or advanced in improving the energy efficiency of facilities and buildings, and just 30% said the same for electrification and decarbonisation of heating and cooling.

There is, however, hope that businesses can leverage innovative solutions to enhance the performance and sustainability of their buildings without the need for extensive new construction, but progress needs to be quicker.

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Technology and digitalisation to accelerate the transition

The report indicates that technology and digitalisation are key levers of a successful infrastructure transition.

This is expected to have the biggest impact on decarbonisation, resource efficiency and well-being over the next three years.

Key technologies that could have the biggest positive impact include AI-driven predictions and automation, virtual and augmented reality, as well as 5G mobile networks.

According to nearly half of respondents, digitalisation has significant or massive potential to support progress in energy efficiency (48%), productivity (46%), and decarbonisation (45%) within their organisations.

Stated Matthias Rebellius, managing board member of Siemens AG and CEO of Smart Infrastructure: “Overall, the report confirms that whilst there is not always a strong alignment between citizens, business and government on the main requirements and goals of the infrastructure transition, it is critical to act now to mitigate the effects of climate change.

“Collaboration and digitalisation across the areas of energy, mobility and buildings will be key in paving the way forward toward a decarbonised world.”

Siemens Smart Infrastructure’s study set out to measure the current state of the infrastructure transition, including developments within the systems, services, buildings and structures that are needed for industries, cities and countries to function effectively.

Data was collected through a global survey of 1,400 senior executives from 22 countries, as well as a series of in-depth interviews with leaders and experts.