Less than 50% of organizations expect to meet decarbonization targets by 2030

Siemens reveals regional, municipal and industrial insights into infrastructure transition in energy, mobility and building systems
15-09-23-canal-solar-Menos de 50% das organizações esperam cumprir metas de descarbonização até 2030
Decarbonization is an important priority in the infrastructure transition, but progress is very slow. Photo: Siemens/Disclosure

A Siemens Smart Infrastructure released insights into the divergent nature of infrastructure transition in a new report titled “Siemens Infrastructure Transition Monitor 2023: The great divide on the path to Net Zero Emissions”.

The data in the report reveals that there is limited alignment in priorities and best way to progress towards a decarbonized world and resource efficient.

While more than half of those surveyed believe the infrastructure transition is accelerating in their region, a quarter of respondents – senior executives from seven major industry groups – said progress is “very slow,” while 29% believe progress is “very slow.” coordinated” and 31% describe progress as “on target”.

The study aimed to measure the current state of infrastructure transition, including developments in systems, services, buildings and structures needed for industries, cities and countries to function effectively.

Data was collected through a global survey of 1,400 senior executives from 22 countries and a series of in-depth interviews with leaders and experts.

According to the company, the main guidelines of the research described in the report include the need for the infrastructure transition to have a positive impact beyond decarbonization.

Secondly, they stated that smarter integration of infrastructures is mandatory to bring about change. Finally, urgent measures must be taken at full speed to avoid disastrous global consequences.

“The infrastructure transition is accelerating, putting pressure on systems around the world – from energy, to mobility and buildings. The evolution of global infrastructure is of utmost importance to enable progress in terms of decarbonization, resource efficiency and social well-being,” said Matthias Rebellius, member of the executive board of Siemens AG and CEO of Smart Infrastructure.

“Technology and digitalization are fundamental to achieving this transition in an intelligent and sustainable way. At Siemens Smart Infrastructure, we have already taken the first steps, creating innovative products, systems, solutions and services to support the present and future challenges of urbanization and climate change”, he highlighted.

Change is not happening fast enough at the regional (country) level

Despite the acceleration of the infrastructure transition, Siemens pointed out that faster progress at a regional (country) level is needed to support a low-carbon world.

Energy is an important priority, as nearly three-quarters of global greenhouse gas emissions come from energy production, use and transportation.

According to the report, fewer than 10% believe their region (or country) is “advanced, fully integrated and at scale” on key energy transition goals.

According to McKinsey, to decarbonize the global energy system, around USD 275 trillion would be needed to make profound changes in the generation, distribution and consumption of electrical energy.

Regulatory authorities are perceived to have the largest share of responsibility in this (according to 31% of respondents), followed closely by the ultimate asset owners, investors/shareholders (25%).

Businesses (17%), politicians (13%) and citizens (13%) are described as having some responsibility, but with significantly less responsibility.

Decarbonization is a competitive advantage for cities

In the fight against climate change, cities play an important role. In the survey, half of those interviewed (51%) believe that being ahead in decarbonization is a competitive advantage for a city.

Decarbonizing the mobility sector, including public transport networks and commercial and private vehicles, is a priority to reduce carbon emissions. 45% of respondents feel that their cities have made progress towards encouraging the use of public transport.

However, the report indicated that 44% also believe that privatizing public transport would accelerate decarbonization. In terms of viable mobility policies, 46% of executives believe that subsidies or taxes should be used to make electric cars cheaper than combustion engine vehicles. Currently, the lack of infrastructure for charging batteries has been considered the biggest barrier to the widespread adoption of electric vehicles.

Only 40% of organizations expect to achieve decarbonization targets this year

Companies are under pressure to decarbonize their business models, assets and infrastructure. According to the report, almost half have targets for Scope 1 and 2 emissions (47%). Only 40% think it is likely that they will meet their targets next year and only 44% expect to meet their targets in 2030.

The study indicates that there may be a correlation between confidence in organizational growth prospects and confidence in decarbonization goals.

Another important area for companies to consider is their buildings. Only 37% of respondents rated their organization as developed or advanced in terms of improving the energy efficiency of facilities and buildings, and only 30% said the same for electrification and/or decarbonization of heating and cooling systems.

There is, however, hope that companies can leverage innovative solutions to improve the performance and sustainability of their buildings without the need for extensive new construction, however progress needs to be faster.

Technology and digitalization to accelerate the transition

The Siemens Infrastructure Transition Monitor 2023 highlighted that technology and digitalization are essential factors for a successful infrastructure transition. This is expected to have the biggest impact on decarbonization, resource efficiency and people's well-being over the next three years.

Key technologies that could have the biggest positive impact include AI-based predictions and automation, virtual and augmented reality, and 5G mobile networks. According to almost half of respondents, digitalization has significant or enormous potential to support progress in energy efficiency (48%), productivity (46%) and decarbonization (45%) in their organizations.

“Overall, the report confirms that while there is not always strong alignment between citizens, businesses and government on the key requirements and goals of infrastructure transition, it is critical to act now to mitigate the effects of climate change. Collaboration and digitalization in the areas of energy, mobility and buildings will be key to paving the way to a decarbonized world”, concluded Matthias Rebellius.

Picture of Mateus Badra
Mateus Badra
Journalist graduated from PUC-Campinas. He worked as a producer, reporter and presenter on TV Bandeirantes and Metro Jornal. Has been following the Brazilian electricity sector since 2020.

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