Evaluate current project list
Evaluate growth and divestment/ aquisition decisions
Evaluate current project list
Business as usual
Business as usual
Align with turnaround/downtimes
Calculate S cope 1 and S cope 2 CO e emissions
Calculate S cope 1 and S cope 2 CO e emissions
Maintain plans and balances e vergreen
Credible Feasible Rat e a b le
De ne basis and reference year
De ne basis and reference year
Aggressive
Aggressive
2100
2100
Today
2030
2040
2020
2050
Today
2030
2040
2020
2050
Figure 2 Business-as-usual scenario evaluation
Figure 3 Resilient scenario evaluation
Business-as-usual scenario case Using fundamental elements, an entity can develop a carbon footprint balance across the next two decades while incorporating current project list activities, downtimes and turnarounds, growth projects, acquisitions, and divestments, excluding any decarbonisation reduction steps. It is important to understand the base case scenario of business-as-usual if an entity were to proceed towards a path with no decarbonisation action plan. In Figure 2 , business as usual is represented by the green trendline. In the past five to seven years, many entities have made the realisation that previously stated commitments were too ambitious with the current commercially available technologies. The red trendline in Figure 2 displays a more aggressive and unrealistic path to meeting the reduction goals due to the expectation that new technology, raw materials, expertise, capital, asset reconfiguration, and project planning can meet the carbon reduction expectations, regardless of the aggressive commitments made by the organisation, industry, or entity. Resilient pathway scenario case For a decarbonisation pathway to be resilient, it needs to display agility, feasibility, and robustness. It must be able to withstand any policy and regulatory changes and respond and adapt to delays with technology readiness and maturity. It is vital that asset review includes growth opportunities, divestment and acquisition decisions, turnaround, and downtime alignment, allowing for a rateable capital investment coupled with technology readiness, growth, and maturity.
It is important to understand the investment budget and forecasted funds to support the journey. The scenario displayed in Figure 3 indicates an ideal step reduction towards net zero, where time is given to incorporate the elements mentioned previously. Summary Every pathway to net zero is unique. It is important to systematically incorporate an array of considerations when it comes to developing a carbon reduction plan. Given the uncertainty surrounding regulations, technology readiness, expertise, and critical material availability, a net zero plan must incorporate the concepts of resiliency. Ensure that the plan is credible, feasible, and robust. Incorporate a stage gate review process into the plan where critical assumptions are documented and planned review times are established to check for the continued viability of the pathway. Pressure test the plan by evaluating against multiple future scenarios to help understand which assumptions are critical for success. Finally, realise that the journey to net zero is going to be a long one, and plans should be treated as evergreen with systematic processes in place to adjust the course as new information becomes available.
Paul Cannizzo paul.cannizzo@solomoninsight.com Marina Barta marina.barta@solomoninsight.com
www.decarbonisationtechnology.com
15
Powered by FlippingBook