Find efficient and rapid solutions for mitigating the effects of climate change and boost renewables: this was message of Sustainability Week. It wasn’t only for the global leaders who had gathered in New York for the 77th Session of the UN General Assembly but also for company representatives attending the UN Global Compact’s Private Sector Forum during a week of meetings and discussions on the climate emergency.
This message has become even more urgent in light of the current global geopolitical situation and the energy crisis. It also comes in the wake of the five-point plan that the UN Secretary-General António Guterres launched in May in order to create the right conditions for tripling public and private investment in the renewables sector.
The Enel Group’s commitment is evident in the decarbonization and investment objectives that were announced in its strategic plan last November. This plan was highlighted by CEO and General Manager Francesco Starace – who was in the United States along with a Group delegation of top management – in his numerous New York engagements. These included the Private Sector Forum, a meeting with Secretary-General Guterres and a select group of CEOs from leading companies in the Global Compact and a visit to the New York Stock Exchange on Wall Street.
A future that is already here
“Without renewables, there can be no future,” said the UN Secretary-General Guterres in May at the unveiling of his five-point plan. “Without renewables there is no present, never mind future,” added Francesco Starace during the Private Sector Forum panel discussion on the finance and investments required for renewable energies and sustainable development. “Because renewables are the present and future of energy generation, and our obligations are clear: develop renewables and replace thermoelectric energy generation wherever it is still in operation,” Starace, who is also the Chair of Sustainable Energy for All, went on to say. “Our goal is to triple our 2020 renewable capacity, achieving a total capacity of 154 GW by 2030.”
This growth fits into the Group’s broader strategic plan, which was presented last November and sets precise goals and obligations. These are namely: ceasing coal-fueled energy generation by 2027, gas-fueled by 2040, ending the retail sale of gas in the same year, and only providing customers with electricity produced from entirely renewable sources. These are all phases of a strategic plan leading toward the most ambitious undertaking: bringing forward the achievement of the objective by ten years and realizing complete decarbonization of business operations (Zero Emissions) in 2040, including both direct and indirect emissions.
Starace added: “Renewables are growing, together with the electrification of consumption; the number of customers is increasing together with many other things. And at the same time emissions are falling. Our aim is to reduce the carbon footprint of our business activities, even though all other aspects are expanding. Today we have reached a point where the Scope 1 emissions produced by our power plants are less than those released by all of our suppliers: we are supporting them in their effort to reduce their emissions.”
Renewables, networks and the electrification of consumption
During Sustainability Week, Alberto De Paoli, the Group’s CFO, took part in the work of Global Compact’s CFO Coalition, which focused on the action that needs to be taken in order to ensure that private investments contribute to the achievement of the Sustainable Development Goals
“We have a very clear vision of how to bring about the energy transition. This is both in terms of costs and benefits all along the value chain, and sustainability. The only route to take is that of generating electricity by means of renewable sources, digitalizing networks and electrifying consumption.”
This vision was enhanced by Starace during the Private Sector Forum: “Renewables and networks are investments which need to be of equal importance moving forward side by side in order to support sustainable growth.”
A just transition, which creates opportunity for all
“Investments in sustainable business choices and sustainable development have to become the norm, because they add value to value,” Alberto De Paoli stressed again. This value translates into benefits for the consumers who chose the path of electrification in a just transition. On the one hand, this brings “a sufficiently positive balance of jobs between those lost in the fossil fuel sector and those created in the changeover to renewable energy generation,” in the opinion of Roberto Deambrogio, Enel Group’s Director of Communications. “But on the other hand, that also translates into improving the quality of life of those most vulnerable and of those populations suffering greatly due to the current energy crisis.”
These issues are of the utmost importance to the Enel Group and are the core of our sustainability Plan, complementing the strategic plan investments. This commitment to a just and inclusive transition combines economic growth with social inclusion.
The role of Transformational Governance
We therefore have investments based on environmental and social sustainability – and governance. “The UN private sector has done a lot of work on the issue of sustainable finance, but the time has come to focus on the letter G in ESG - Environmental, Social and Governance,” said Giulio Fazio, the Enel Group’s General Counsel. In New York he opened the debate on the new Global Compact initiative on Transformational Governance, which aims to expand the role of the legal professions in the field of sustainability so as to better guide business decisions.
“To achieve the SDG16 objectives (Peace, justice and strong institutions), it is necessary to rethink the traditional governance models in view of company responsibilities toward a wide range of stakeholders: customers, workers, local communities, suppliers, partners, the finance world and the planet itself. Given the multiple crises that the world is facing, the time to act and embrace the valuable aspects of governance has truly arrived.”
It’s possible to accelerate, but we need a change in mentality
The events of the week in New York have asked important questions about the growth of renewables, the urgency to reduce emissions and the need for a just transition. The Enel Group’s strategy has supplied practical answers, with clear deadlines and commitments.
Acceleration is therefore possible and, in this respect, there is no lack of investment. On a global level, there is still an obstacle to overcome in order to achieve the results demanded by the plan put forward by the UN Secretary- General. As Francesco Starace stressed in the Private Sector Forum discussion: “There was a time when renewables were referred to as ‘alternative energies,’ whereas today they are the backbone of energy generation and will continue to be for this entire decade, which will be the decade of electrification. However, the narrative on renewables still needs to change when it comes to the world of finance: from renewables being seen as promising new ventures to becoming a mature and reliable investment opportunity. The only limit to their growth is not investment, but the ability to attract it."
This capacity needs to be developed as quickly as possible because renewables, along with electrification, are not only the main tool for the energy transition: they also provide the basis for sustainable economic and financial growth.