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Hitachi Sustainability

23 July 2021
Hitachi

COP26: Less Than 100 Days to Go

Countdown to COP26

Five steps forward and five more to take

We’re now less than 100 days away from an environmental conference that could help shape the future direction of the world economy for decades to come. COP26 is a key global climate conference and as part of our Countdown to COP26 series, we consider the recent developments and future decisions that can unleash the huge business opportunity presented by this defining moment in time.

FIVE STEPS FORWARD

1. Governments are taking action

Governments are starting to make bigger, bolder and more inclusive commitments. Recently, Japan almost doubled its target for cutting carbon emissions, with Prime Minister Yoshihide Suga saying Japan would aim for a 46% cut by 2030. In the US, President Biden has introduced a $2 trillion plan to overhaul and upgrade the nation’s infrastructure with a major focus on green energy and decarbonisation, the EU has launched its European Green Deal plan to make its economy sustainable, and the UK has enshrined a new target in law to reduce emissions by 78% by 2035. In summary, we could be about to see the largest investment in infrastructure in generations.

2. The Race to Zero is gathering pace

Major international events such as the Global Leaders Summit on Climate and the B7 Climate Leaders Summit have helped galvanise the collective effort. As we stand, the Race to Zero campaign signatories represent 733 cities, 31 regions, 3,067 businesses, 173 of the biggest investors, and 622 Higher Education Institutions. These ‘real economy’ actors join 120 countries in the largest ever alliance committed to achieving net zero carbon emissions by 2050 at the latest. Collectively, these actors now cover nearly 25% of global CO2 emissions and over 50% of GDP. Against this backdrop, more and more companies will look at their own net zero targets and supply chain emissions. At Hitachi, our commitments include the achievement of carbon neutrality at all of our factories and offices by the fiscal year 2030 and an 80% reduction in CO₂ emissions across our value chain by 2050.

3. Partnerships are taking centre stage

We’re seeing companies and organisations come together like never before. For our part, we’re right at the heart of Optimise Prime, the world’s largest commercial electric vehicle trial to date. We’re collaborating with Royal Mail, Uber, UK Power Networks, Centrica and Scottish and Southern Electricity Networks in a three-year trial that will inform the UK government on how best to develop its EV infrastructure. And earlier this year we announced a partnership between Hitachi ABB Power Grids and GE with joint IP around technologies to reduce the greenhouse gas emissions for high electricity transformers and switchgears.

4. Fleet Services are motoring

One key area where partnerships are making a fundamental difference is fleet services. The recent collaboration between Hitachi Europe and Shenzhen Bus Group (SZBG), one of the largest new energy public transportation groups in the world, is helping European bus operators and municipalities electrify their bus fleets. We’ve also teamed up with Arrival to deliver new bus and infrastructure solutions to the European bus industry. And our Intelligent Fleet Decarbonisation (IFD) approach is delivering “trains as a service” with Hitachi Rail and bus depot infrastructure deployments across the UK.

5. Unlocking a smarter and more flexible grid

Of course, the energy transition is at the heart of everything we do, and it’s encouraging that we are arguably better connected than ever before. From a Hitachi point of view, we are very engaged in the connectivity of renewable energies – we’re a big player in connecting Norway to Germany, Dogger Bank to the UK, and we’re developing solar farms in Angola. And we’re proud that Hitachi ABB Power Grids is contributing to National Grid’s latest interconnector, IFA2, the second direct current (HVDC) electrical interconnector between Britain and France – it’s expected to deliver 1.2% of Britain’s electricity needs, enough to power up to one million homes with clean energy. We’re aware that industry has a finite capacity but there is more capacity that can be brought to bear so that we can handle more and more of these schemes.

FIVE STEPS TO TAKE

1. More digital innovation

Digital innovation is the key to a successful energy transition so we must put digital right at the heart of our approach. There are huge opportunities, particularly around smart energy, mobility and industry and the role of Hitachi is to help business unlock these transformational business benefits through our sector experience and our expertise in digital innovation. We are uniting all of our Hitachi business units behind the common cause of the environment – it’s the connector that flows across our businesses globally but also the link to the types of challenges that our clients are facing. We’re heading in the right direction, but we need to do more.

2. More collaboration

It’s great that we are seeing more co-creation and more partnerships, but the reality is that we need much more of this if we are to succeed in our collective climate change ambitions. At Hitachi we absolutely understand that these important business decisions come with a cost, but the reality is that investment can quickly become a saving – let’s face it, energy saving technology and CO2 reduction technology are the same thing.

3. More business advocacy

Delivering net zero and being commercially successful go hand in hand but we still need more support from the business world. If you look at the performance of companies that have a strong ESG rating over the last five years, their share price has consistently outperformed companies that have a lower ESG rating. We need more businesses to join the UN’s Race to Zero campaign. It really is the gold standard for businesses.

4. More opportunity for developing nations

The first world may often lead on technology, but the developing nations have a critical role to play, particularly when it comes to solar power. Their challenge will be how to distribute that and support rural communities where the grid is not currently in place. So, expect to see innovation from the local generation of energy, more micro grids and more localised energy production sites to support movement and transport in much of the developing world.

5. More social mobility

When you consider the future of public transport, there are two key areas – firstly, social mobility and the social inclusion of communities to be able to move around, but secondly, doing this is in a green and efficient way. We need to find the right blend of different modes of transport to keep people mobile, particularly bearing in mind we’re now living in a delivery society which has a massive impact on our CO2 emissions.

If we can use the springboard of COP26 to propel us forward on these five steps, then we’re well and truly on the road to a successful energy transition and a cleaner, greener planet.

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