Insight

For some businesses, moving to Net Zero is already core to their strategy with money and time committed to making it happen. However, for a significant number of businesses Net Zero remains ,something for the future,, behind a queue of competing priorities including recovery of cashflow from the pandemic, increasing material and overhead prices, finding skilled staff, etc.

The fact that different companies are at different stages of addressing the shift to Net Zero is simply a reflection of whether strong motivating factors are present: whether there is the ,carrot, of a business opportunity or a ,stick, of regulation. Whilst it is probably true to say that most businesses can see the direction of travel, and most are already convinced of the scientific evidence about the necessity of moving to Net Zero, the case for changing business as usual can be quite difficult to make for some, in a culture where financial returns dictate which projects receive investment.

Sure, some larger organisations must report levels of carbon emissions, by law, and an even smaller number have to participate in mandatory carbon trading schemes, with associated ,real, carbon prices. Some sectors face significant pressure from society to demonstrate action and others are seeing real commercial benefits from being able to point to concrete actions they have taken and the plan they have in place to go further. With some investments, there are obvious cost savings from energy efficiency projects, which also provide carbon reduction benefits. However, for a large number of small and medium sized companies, that do not deliver products and services visible to consumer markets, the motivation to shift to Net Zero may not be as strong and, therefore, competing pressures win out in the short term. This is not because business leaders and decision makers don,t want to act on Net Zero – in the main, they do – the question is whether starting the journey and progressing towards Net Zero can be made any easier?

There is an increasing focus on whether digital technology can be used to support businesses with their journey to Net Zero. So called, ,digital Climate Tech, solutions are receiving significant support from investors, who see them as playing a vital supporting role (and revenue generator) in the shift to Net Zero. In the year to mid-2021, PwC reported global investment in Climate Tech of US$87.5bn, a year-on-year growth in investment over 200%. Whilst the majority of this investment is in physical Climate Tech, such as electric vehicles, direct air capture of carbon, etc., a significant amount has supported the development of digital Climate Tech solutions.

These digital Climate Tech solutions provide support to help business measure, monitor and reduce their own carbon footprint and also to take advantage of new business opportunities presented by others shifting to Net Zero. The do this by using digital technologies such as sensors, controllers, artificial intelligence, blockchain, data analytics, digital twinning, etc.

Scotland has its own growing community of digital Climate Tech developers including, for example:

Smarter Grid Solutions, which develops various digital solutions that support capacity management, flexible interconnection, virtual power plant, microgrid, fleet energy asset operations, energy as a service and local energy applications.

Intelligent Plant, which has developed an Industrial App Store for digital solutions capable of performance monitoring of equipment and processes.

Reath, which has developed a digital solution to enable companies to track reusable items or packaging, reducing reverse logistics challenges and enabling circular economy business models.

Key FM, which has developed sensor-based building performance monitoring solutions that monitor occupancy rates, optimise energy consumption, alert to floods, etc.

Intelligent Growth Solutions, which develops digital systems for vertical farming using Internet of Things and Artificial Intelligence to provide optimal growing conditions for crops.

More examples of these pioneering digital Climate Tech developers can be found on the website of the trade body, ScotlandIS. This includes case study examples of digital Climate Tech solutions developed in Scotland, opportunities for funding the development of new solutions and a number of useful reports and other resources on the topic. This is a good source of ideas and inspiration for companies that see the shift to Net Zero as presenting business opportunities that could be harnessed by digital technology.

There are also some great resources for companies seeking to get started on addressing their own carbon emissions, to help understand their own footprint and how they can start to measure, monitor, report and develop a Net Zero roadmap. There is an excellent set of short practical webinars on various aspects of Net Zero on the Scottish Engineering website. These have been developed by Scottish Engineering with funding support from Skills Development Scotland and are publicly and freely available: www.scottishengineering.org.uk/net-zero-skills/path-to-net-zero-webinars.