How CEOs Adjust to Energy Transition Amid Market Pressures
A recent study by energy solutions provider Aggreko unveils how European CEOs are adapting their climate strategies in the face of economic headwinds.
The study, which surveyed 400 CEOs across Europe, paints a picture of an industry in flux, with executives striving to balance profitability and environmental responsibility.
Despite economic challenges, climate technology remains a key focus for European businesses. The report reveals that 87% of companies are already implementing decentralised energy solutions, such as on-site power generation and energy storage systems, to meet both environmental and financial targets.
Robert Wells, Europe President of Aggreko, says: "Our report aims to shed light on how leaders are adapting to evolving market conditions while pursuing their sustainability objectives."
- Decentralised energy solutions are energy systems that produce energy close to where it's used, instead of at a large power plant and then sending it through the grid.
- They can use a variety of renewable energy sources, such as: solar power, wind power, biomass, biofuels, small hydropower systems and combined heat and power (CHP) systems.
Aggreko's report: A breakdown
The research reveals that more than 95% of European CEOs have adjusted their energy transition timelines in response to recent market pressures, with half extending their net zero target dates.
This study features insights from executives in energy-intensive sectors across the UK, Germany, France and Italy, highlighting the growing tension between environmental commitments and commercial realities.
Despite stringent environmental regulations like the Deforestation Regulation and the Corporate Sustainability Due Diligence Directive — which mandate businesses to address their environmental impacts — only 12% of CEOs cited the speed of decarbonisation as their primary concern.
Instead, cost reduction and commercial advantage take precedence.
EU regulations shape business approaches to net zero
Investment in green technologies continues, albeit at a more cautious pace.
In line with this, 80% of executives expect to increase their investments in energy transition initiatives through 2025, though most anticipate only modest increases.
This reflects the complex balance leaders must maintain in today’s challenging economic environment. Aggreko's research indicates a significant shift towards decentralised energy solutions, with 54% of businesses planning to expand their existing systems.
This trend is driven by concerns over grid stability and a desire for energy sovereignty, allowing companies to shield themselves from unpredictable external factors.
Do supply chains dictate corporate policy
The report also highlights supply chain vulnerabilities as a critical concern among CEOs.
Nearly half of executives cite their supply chains as one of the greatest risks to their energy transition plans, with 21% ranking it as their top risk.
This underscores the interconnected challenges businesses face when implementing sustainable practices — particularly in efforts to reduce Scope 3 emissions.
Robert says: “It is not surprising that our research has uncovered leaders across Europe are looking for change when it comes to their energy supply chain.
“In a tough economic landscape, grid instability and connection delays, price uncertainty and looming ESG targets are impacting many businesses’ energy transitions."
The findings reveal notable variations by region — different markets face unique challenges.
For instance, stakeholders’ support emerged as the primary barrier to expanding decentralised energy solutions in Germany and France.
In contrast, Italian executives pointed to commercial viability as their main concern while UK leaders identified the intermittency of green energy as their foremost challenge.
The persistence of tradition
Aggreko's research also indicates that traditional energy procurement methods remain prevalent — 46% of companies still favor conventional energy contracts despite the availability of more flexible alternatives like power purchase agreements and energy-as-a-service models.
This conservative approach persists even as businesses face mounting pressure to reduce costs and meet environmental targets.
However, there is an emerging trend toward data-driven decision-making.
Of those surveyed, 16% of CEOs indicate that data is the single most important factor influencing their company’s energy transition strategy.
This shift suggests a move towards more sophisticated approaches to energy management that prioritise data over traditional factors such as dedicated ESG directors or external consultants.
Balancing steady transition with total transformation
Overall, Aggreko's study illustrates that European industries are in a delicate transition period as they strive to balance environmental commitments with commercial realities.
As highlighted by the report, this balancing act is particularly challenging amid strong economic headwinds while CEOs aim to maintain stability.
Aggreko's leadership appears optimistic about the ongoing energy transition process.
"Particularly when capital is at a premium, supporting customers with controlling costs and energy supply will remain a key part of ensuring a smooth energy transition," Robert says.
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