Power Executives on the Race to Net Zero

Adapting to ESG: #NetZero #SupplyChain #GovernmentSupport Key Takeaways:

• Effective ESG strategies require adjusting to supply chain challenges and securing stable cash flows.
• Government policies play a crucial role in de-risking and supporting the transition to net zero.
• Investors demand discipline in risk assessment and project execution amidst renewable energy sector volatility.

Further Insights

1. Sector Challenges: The renewable energy sector faces macroeconomic changes and supply chain issues, impacting project feasibility and financial close.

2. Government Role: Government updates, including contracts for differences, aim to de-risk the sector by ensuring a minimum price for carbon credits, highlighting the need for clear volume, predictability, and reference in policy frameworks.

3. Grid Stability: Grid stability and affordability are key concerns. The transition requires balancing decarbonization with the reliability and cost-effectiveness of the energy supply.

4. Supply Chain Resilience: Companies adapt to global supply chain vulnerabilities by locking in turbine costs and construction contracts at project initiation to mitigate risks.

5. Market Adaptation: The resilience of renewable energy demand, despite sector challenges, underpins the market's capacity to adjust to pricing and cost of capital changes.

6. Investor Expectations: Investors expect thorough risk assessments and disciplined project execution, emphasizing the maturation and evolving demands in the renewable energy sector.

Closing Thoughts: As the renewable energy sector navigates through supply chain disruptions and regulatory changes, the role of government and the need for innovative solutions to maintain grid stability and project viability become increasingly apparent. How can businesses and policymakers work together to ensure the transition to net zero is both sustainable and economically viable?