CDP: Critical Gaps in Corporate Renewable Energy Targets

As the spotlight falls on global climate initiatives during COP29, a pressing report by CDP discloses a significant shortfall in corporate engagement with renewable electricity.

Although COP28 set ambitious targets for tripling renewable capacities and doubling efficiency, the actual corporate follow-through remains sluggish.

The findings come at a critical moment as global leaders gathered for ‘Energy Day’ at the climate summit.

However, statistics reveal an inconvenient truth: a mere 10% of companies explicitly commit to using 100% renewable energy sources.

This slack pace in adopting cleaner energy resources casts a long shadow over the goals of reducing global emissions.

The timing couldn't be more critical, as leaders and policymakers rally around the need for urgent actions in the renewable sector.

A clear call for corporate accountability

CDP, a preeminent environmental reporting organisation, garners insights from more than 24,800 global companies — representing significant portions of the world’s market capitalisation and a quarter of the commercial electricity consumption.

Alarmingly, the transition to renewable electricity is inadequate, which directly affects the broader Scope 3 emissions impacting entire supply chains and product lifecycles.

Amir Sokolowski, Director of Climate Change at CDP, is clear about the urgency: “Most companies are still moving far too slowly on renewable electricity, despite it being in their business interest to do so.

"As COP29 calls for urgent and accelerated climate action, our data highlights an immense, untapped potential in corporate renewable energy use. Without this, the global energy transition risks stalling.”

An in-depth look into CDP’s findings illustrates a stark contrast: while the few companies with a renewable energy strategy incorporate an average of 53% renewables into their energy mix, an overwhelming majority lag behind.

Only 5% set benchmarks for improving energy efficiency — a critical and beneficial strategy often overlooked.

Furthermore, the report underscores a significant transparency issue. Although many companies claim a 29% use of renewable electricity, verifiable data supports only 16% of these claims.

This discrepancy poses hurdles in forming effective energy markets or fostering new renewable projects.

The influence of super users

Of the nearly 10,000 companies analysed, 682 “super users” emerge as key players, consuming over 75% of the total disclosed electricity — each using upwards of 1TWh annually, the equivalent to the energy needs of 95,000 US households.

However, despite their potential to lead transformative change, these super users report only 33% of their electricity from renewable sources on average — a stark contrast to smaller companies averaging 47%.

Not all hope is lost, as some like Deutsche Telekom, Microsoft and Robert Bosch, have managed over 90% usage, demonstrating the feasible impact of strong corporate commitments.

The presence of these influential entities suggests a significant opportunity; by spearheading renewable energy initiatives, they can catalyse the energy sector towards more sustainable practices and attain global climate objectives.

The road ahead

Businesses are urged to decisively incorporate renewable solutions into their operations.

The establishment of clear, verifiable targets for renewable energy procurement and energy efficiency is fundamental for progress.

The urgency highlighted in this year's COP29 stresses the stakes at play if accelerated measures are not taken.

“The path forward demands companies of all sizes prioritise verifiable renewable energy use and purchase targets alongside energy efficiency targets. Transparency is foundational to this goal,” Amir emphasises.

Both economic benefits and emission reductions are to be had for companies that commit to this transition—creating a win-win scenario towards a sustainable future.

Yet, if today’s corporate giants fail to pivot towards more sustainable models, the lofty energy targets postulated at prior COP summits risk becoming aspirations rather than achievements.

As major consumers of electricity, their immediate choices hold the key to fostering a resilient, zero-carbon economy.

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