Transitioning to Net Zero

As in life, the Energy Transition and achievement of Net Zero, in my mind, is about balance. The goal to reach Net Zero is quite rightly high on the global and political agenda and we all have a role, a responsibility as individuals to play our part in its success over the coming years and decades.  

These two words are front and centre: “Net” and “Zero,” but what does Net Zero actually mean? The term Net Zero means achieving a balance between the carbon emitted into the atmosphere and the carbon removed from it. This balance – or Net Zero – will happen when the amount of carbon we add to the atmosphere is no more than the amount removed. Quite a challenge when in 2018 the UK was ranked as the 17th highest carbon emitting country contributing 1.1% of total global emissions. In reviewing the comprehensive data available up to 2018 unsurprisingly China topped that list with 28% and worryingly it’s a trend that seems to be on the increase. It will be of great interest to hear what the scientists present during COP26 in November.  

Fossil fuels such as coal, oil and gas are some of the most important natural resources that we use on a daily basis. These fossil fuels are hydrocarbons. They are compounds formed from only two elements, Carbon and Hydrogen and when hydrocarbons are burned in the presence of oxygen they release carbon dioxide into the atmosphere and this, as a Greenhouse Gas, is a leading cause of global climate change.  

However, in my “balanced” view, don’t we have to be careful that in striving for one thing we don’t disrespect or neglect the other? Fossil fuel exploration and extraction will continue to have a major part to play in our environmental society. Renewables such as wind, tidal and solar are at best playing their part in reducing carbon emissions with investment, R&D, technology & political messaging all making great strides to speed this up. We do, however, need both oil and natural gas. For instance, looking at a vast list of biproducts of crude oil, I was educated as to the prominence of oil in our everyday lives. I struggle to recognise where a renewable energy source could produce solvents, ink, tyres, nail polish, petroleum jelly, medicine capsules, deodorant, fertilizers, candles, anti-freeze … to name but a few. We cannot overnight stop the reliance on fossil fuels, but we can start and over time replace fossil fuels with low-carbon renewable energy sources which can fuel our heating, cooling and transportation demands.  

Looking towards new and future energy sources we still have to be mindful of our finite resources. The mining and refining of alkali metal lithium is growing rapidly. This natural resource is required for the production of electric vehicle, laptop and mobile phone batteries and already mining in China, Australia and in the South Americas is in full flow. Hydrogen energy is another significant energy source, but yet again we have to be mindful as to its costs and global environmental impact. According to the International Energy Agency, 96% of hydrogen created worldwide is produced using fossil fuels through a process known as reforming. This is the process of combining fossil fuels with steam so therefore we can quickly see the need of one for the other. 

Fossil fuels are essential but at what volume can the environment be sustained? This is the vital question. All COP26 attending nations must unite and work together to achieve a global balance. They must ensure industry continues, heat, light and power is affordable to all but ultimately must agree to reverse this trend of increasing global carbon emissions which in turn, like in life, can lead to a balanced world for us all to live in.  

If you would like any more information, please contact Audit Senior Manager, Graeme Robertson, or your usual AAB contact.