Energy transition and net zero
Amos: I'm general counsel and company secretary for Low Carbon, a company I joined five years ago. Low Carbon is a renewable energy, independent power producer (IPP) and investment company. For the company’s first 10 years, we developed greenfield sites and then sold on at the ready-to-build stage. More recently, we have partnered with a US insurance company, Massachusetts Mutual Life Insurance Company, that has enabled us to transition to what you would call the IPP model. That means we are now holding our projects beyond development, through construction and into operation, including a growing portfolio of solar projects (some with co-located battery storage) in the UK and Netherlands. We are also actively developing a number of onshore wind, battery storage and waste-to-energy projects across Northern and Eastern Europe, and North America. We have set ourselves the ambitious target of creating 20 gigawatts of new renewable energy capacity by 2030 (for context, total installed energy capacity in the UK in 2022 was about 107 gigawatts, around half of which was renewable).
Alumnus of London and Tokyo offices
2004 - 2015
Irina: I am a partner in the Herbert Smith Freehills Energy group, based in Singapore, and I advise on a range of energy sector matters, including renewable energy projects, in the region. I moved to Southeast Asia about 13 years ago. Over the years, my practice has evolved, from predominantly coal mining, to oil and gas and LNG work, and then power and the renewable sector. Increasingly, we see projects and transactions in the energy transition space, from renewables, to hydrogen, carbon capture and storage and carbon trading. Our clients are looking at all types of energy transition projects to reposition their own businesses.
Jerome: I am Head of Legal, Japan for ENGIE, a leader in low-carbon electricity production and centralised and decentralised energy networks in electricity, natural gas and energy transition. ENGIE’s purpose is to act to accelerate the transition towards a carbon-neutral economy, through reduced energy consumption and more environmentally-friendly solutions. Specifically, and in addition to my role in Japan focusing on physical power trading, I lead the team lead helping create green solutions – including green power purchase agreements, ammonia and battery storage – in APAC and the Middle East. Previously, I worked for ENGIE for about five years, working out of our regional headquarters in Bangkok/Singapore, and then moved to the Macquarie group’s offshore wind platform, Corio Generation, in Singapore, before returning back to ENGIE in Tokyo in late 2023.
Mark: I am the managing director and CEO for the Australian Institute of Company Directors (AICD). Energy transition is one of four policy areas that we focus on at the AICD, educating and helping directors to make them aware of the issues, what best practice is and how best to connect to a community which is going to allow them to be at the forefront of contemporary governance practice.
Ben: I am head of contract management for Volta Trucks, a start-up that is developing electric trucks. Founded in Sweden, the aim of the company is to build trucks with zero tailpipe emissions, that improve working conditions for drivers and make cities safer for pedestrians and cyclists. We’re concentrating at the moment on 16-tonne trucks, with a range of 200+km so ideal for last-mile deliveries in city centres. Our trucks are manufactured in Austria and we’re focusing our operations in France, Germany, the UK and Spain. We help clients across the board, from charging infrastructure, financing and insurance to supply of the trucks, maintenance and servicing.
Irina: I think the first thing to highlight is that energy transition means different things in different parts of the world. In Southeast Asia, transition to a fully decarbonised economy and away from fossil fuels is likely to take more time. For example, in many Southeast Asian jurisdictions (like Malaysia and Vietnam and, to a large extent, China), a significant proportion of power generation still comes from coal, so for those jurisdictions part of energy transition is moving away from coal and on to cleaner fossil fuels like gas or LNG. Whilst this change still results in use of fossil fuels in power generation, it represents an intermediate step towards fully decarbonising. This transition also ensures that there is a stable base load generation, to balance out intermittency issues resulting from renewable power generation. That said, Southeast Asia has taken great strides towards energy transition and we have seen a lot of investment from a diverse group of clients into development of renewable power projects across the region, in particular in Philippines, Vietnam and Indonesia.
Jerome: As Irina says, certain countries, in particular within the APAC region, will require more time to transition away from a reliance on fossil fuels, namely coal and LNG. One of the key takeaways from COP27 was the creation of a “loss and damage” fund, which is being set up for the purposes of “assisting developing countries that are particularly vulnerable to the adverse effects of climate change”. I think this initiative may be key to encourage some countries in Southeast Asia to accelerate their efforts to move away from fossil fuels.
We have also seen from last year’s events in Ukraine and its impact in Europe that it poses a risk for countries to rely to a great extent on energy produced in other countries. I think that this risk highlights the need for certain countries to move away from the import of fossil fuels and instead focus on renewable energy produced at home.
Amos: I think it's important to recognise what has got us to where we are today, and the reality is that we wouldn't be in a position to decarbonise the world were it not for the technological and other advances that the fossil fuel industry has enabled, both directly and indirectly. For me, this recognition is key to unlocking the currently very polarised and polarising debate. This doesn’t in any way diminish my firm belief that renewables represent our best hope for the future of electricity generation, but context is everything.
Ben: The other point I would make is that our sector – electric vehicles – is still in its infancy and there is huge potential for improvements, particularly in battery technology. Whilst there are entrenched positions, there’s also healthy competition to get the best product to market: Renault Trucks have electric versions of some of their trucks, for example. Others, like BP Pulse, are building on their strengths and seizing market opportunities in the charging infrastructure space.
Jerome: Yes, the development of battery technology is key. An interesting debate is the one taking place in relation to the role of hydrogen within the energy mix and whether it is realistic to place too much hope on this particular solution due to its inherent disadvantages. I strongly believe that hydrogen (for instance, as feedstock for the production of ammonia) will have an increased role to play in many countries in the years to come. Blending hydrogen within existing gas networks is also a relatively straightforward solution in certain countries where the infrastructure can withstand it. On the other hand, shipping hydrogen in liquid form over long distances remains technically challenging for now.
Mark: I’m interested in terms of legacy for future generations. Will we leave behind a sustainable environment for those who follow us? I’m also interested in it being in Australia, frankly, from a commercial and national interest base. We are a large fossil fuels producer: our three biggest exports in Australia are iron ore, coal and gas. We need to come up with a way to replace those over time. Getting on board with climate change and energy transition in Australia, even if you are climate change denier, means we are going to have to do something different just to preserve and enhance our commercial and national interests.
Irina: Absolutely. As I mentioned earlier, my own career has developed over the years towards lower and then low carbon energy. Environmental protection is something I have always been passionate about and it’s a conversation I have with my nine-year old daughter a lot, encouraging us to make choices – to walk, rather than drive, turn off air conditioning and so on. She is taught about climate change at school and they go on projects, such as beach clean-ups, and from there learning where the rubbish is coming from. And they’re talking a lot about what we as individuals can do to reduce that type of rubbish.
Ben: That’s interesting to hear of your daughter’s experience, Irina. When I lived in Singapore we did beach clean-ups as a family. Not only were you doing something good for the environment, but getting healthy at the same time. That sparked my interest in plastic waste and led to me joining The Ocean Cleanup – a great nonprofit that has meaningful impact on the problem. My next career move, into the EV sector, was motivated by a desire to marry positive impact with the for-profit sector.
Amos: Absolutely. Embracing the transition to low carbon energy in an effort to tread more lightly on the planet definitely aligns with my personal values. At Low Carbon, everybody shares, to some degree, that kind of passion around trying to do something to tackle the causes of climate change. There’s a clear goal driving what we do as an organisation, which makes the workplace and work ethic very positive and focused.
Jerome: I am proud and happy to have been working in the renewable energy industry for several years, for the environment, for the future of our planet and for future generations. This didn’t happen as an epiphany but rather naturally and gradually.
Ben: I’ve just finished re-reading Doughnut Economics by Kate Raworth. It seems pretty self-evident, but we can’t continue with perpetual growth. On a finite planet, we need to respect certain planetary boundaries (raw materials, pollution, etc). It also makes sense to me that we should maintain social foundations and protect the most vulnerable (education, healthcare, etc). If we respect these principles then we should be able to thrive. I don’t say it’s easy, but she makes some pretty compelling arguments.
Amos: We are in a climate emergency, there is no doubt about it. There are still sceptics, and even if they’re not denying climate change, they may feel that renewables isn’t currently the solution, so there’s definitely a challenge there. But I do feel that, compared to 10 years ago, climate change is getting a lot more mainstream attention, demonstrating the increasing seriousness with which this crisis is being taken.
Jerome: I usually make the point that regardless of one’s opinion on climate change, you cannot deny that fossil fuels create pollution which has negative effects on the environment and on people’s quality of life and ability to enjoy it. This in itself should be reason enough to prioritise renewable energy over fossil fuels.
Mark: One big issue in Australia is greenwashing. The government regulator has got several cases on the go against companies for alleged greenwashing. These tend to be in two areas. Energy companies and fund managers marketing “green” products and funds. The spotlight is on those who attempt to say they’re doing something good when they’re not. The dilemma is to not overregulate or over enforce such that you discourage people from doing something good. That just produces green hushing.
Alumnus of Paris and Tokyo offices
2008 - 2013
Amos: Of course, any long-term solution has to make commercial sense. When I interviewed with Low Carbon, the leadership was keen to highlight that the company isn’t about environmental activism. While we are very much mission-driven, we have to be competitive with other sources of electricity production. The really good news is renewables now are not only competitive, but in many instances they are the cheapest source of electricity production. The economic case for renewables really stacks up now, and we’re seeing that tipping point with the investment community now leaning in hard.
Mark: Market dynamics will ultimately determine the way forward. The question is, does there need to be an intervention to bring forward the market dynamics? Do you need to subsidise renewables so that the average cost comes down to match fossil fuels or even better?
Irina: It is important that renewable projects need to be commercially viable – although I think that governments have a role to play here. We have seen a number of jurisdictions take energy transition seriously and put in place support mechanisms to help encourage development of renewable projects, for example Philippines and Vietnam have in the past provided generous feed-in tariffs for renewable power. The challenge is regulatory change needed to enable diversity of supply, structures that allow you to buy renewable electricity indirectly or directly from a producer in other markets that are heavily regulated.
Ben: Personally, I think governments should be leading to set favourable conditions so all sectors can transition more easily to renewables. Not only does this make sense from a climate perspective, but also in terms of energy security – as can be seen by the impact on oil and gas prices from current conflicts in Ukraine and Israel.
Mark: Yes, they can. In Europe, it has traditionally been governments not business that are driving change. In Australia, it has been the opposite; it is the corporate sector, particularly the large listed companies, that are leading change. Our organisation, the AICD, has been in the middle of this thinking. We’re working side-by-side with large corporates irrespective of the way government was going. As it’s happened, government has caught up on that particular issue in the last 12 months. Having said that, we are pushing back on overregulation by government wanting to force companies to change, with the prospect of sanctions and imposing personal liability on directors. We emphasised that the key was awareness, capacity building, education, so as to show business a pathway to change they can navigate. You don’t want to force people to act so as to achieve a minimum compliance standard, you want to incentivise people to aim for best practice, the maximum standard. The federal government, to their credit, listened. For example the business sector supports mandatory climate reporting as a way to drive behavioural change which will then help drive towards decarbonising the environment, but without imposing personal liability on directors by way of new and additional liability provisions.
Irina: What we have noticed is the commitment from the private sector, as Mark has just said. There are large-scale corporates who have made their own commitments about their net zero targets. They want to be part of the RE100 club where they certify 100% of the electricity they use is coming from renewable sources. That means that they are willing to pay a bit of a premium on renewable power if it helps to meet their own goals.
Alumnus of Sydney and London offices
1996 - 2022
Jerome: I do believe that we should be pragmatic in pursuing our collective efforts to move away from fossil fuels and understand that fossil fuels will still have a role (although progressively diminishing) in the ongoing transition. We should understand that certain countries, in particular emerging markets, will need more time and undergo more efforts than other, more developed ones. More developed nations should encourage these efforts and incentivise the move away from fossil fuels.
Irina: Absolutely, particularly when you look at renewables’ intermittency issues, by which I mean uneven power supply for example in solar and wind, not so much geothermal or large scale hydro, but then that is not available to all countries. Unless you get to a stage where you can have large-scale storage solutions that are economically viable, you are going to have to get a stable base load from somewhere.
Ben: In terms of challenges with intermittency, I think here is where technology can step in along with the creativity of the private sector and favourable conditions set by government. For example, if energy production is decentralised, small-scale storage becomes more viable. And in some cases, even EVs can store energy and release them back into the grid when needed. As I said earlier, it’s not easy! But I’m optimistic the solutions can be found.
Mark: Another issue is that many companies think of energy transition as a cost, which of course it is, but it also presents huge opportunities. For Australia, there is a further debate, about whether we should just mine the minerals that are good for energy transition (for example to use in batteries). Or whether we should seek to extract and then manufacture those minerals and maybe even produce the end products like batteries – to do the whole cycle from extraction to sale. The thinking is that we could build new industries. That’s complicated, because there are also national security issues, as well as huge capital investment. However, this highlights the opportunity within energy transition despite the costs that are involved.
Irina: Another challenge is consistency of approach over time, as different governments or stakeholders may have different levels of commitment to energy transition. This in turn can create uncertainty for investors. Take Indonesia, for example: the Indonesian government has recently unveiled a $20 billion programme for energy transition. This government has generally been supportive of introducing measures to encourage energy transition – for example, they have established a carbon market, published regulations to enable carbon capture and storage projects and introduced reforms to encourage development of renewable power generation. However, it remains a little unclear whether the next government (which will come to power next year) will remain similarly committed.
Alumnus of Paris office
2005 - 2010
Mark: Yes, we have lots of things needed for renewable energy like wind and sun, lithium and other minerals that can be used for renewable energy solutions. One of the biggest problems facing renewable energy in Australia is the skills shortage, for example obtaining enough engineers to deliver the proposed installation of new wind turbines. With the whole world engaged in transition, there is a huge demand for those with the right skills. It used to be the technology that was not good enough. Now the technology is good enough, but there aren’t enough skills to deploy it at the pace we would like.
Jerome: I would add to that a key sector in which companies such as ENGIE have been focusing on quite aggressively over the past few years, with the help of government and governmental organisations, is green hydrogen ie, hydrogen produced from renewable energy. Since the release of Australia’s National Hydrogen Strategy in 2019 there is now a AUD127 billion pipeline of announced hydrogen investment in the country. As an example of an early success story in the sector, ENGIE and Mitsui have been developing one of the world’s first industrial-scale green hydrogen projects, providing hydrogen as feedstock into the offtaker’s existing ammonia operations in Western Australia. The offtaker then exports the ammonia from Australia to the Asian markets. The team and I worked quite extensively on the first phase of the project, which is scheduled for completion in 2024, and the team is now preparing for the next phase of the project’s implementation.
Irina: Singapore is limited in its ability to develop renewable projects itself given its small land area. Instead, the government has announced plans to import renewable energy from neighbouring countries. The hope is that it will encourage development of renewable power projects in the neighbouring countries as well as development of interconnectors to transmit that electricity, or some of it, into Singapore. We are currently working on a number of projects that are part of this import scheme.
Amos: A lot! And it doesn’t have to cost anything, involve huge effort, or require painful lifestyle sacrifices. Right now, there is no excuse to be on a non-green electricity tariff - there are plenty of competitively priced 100% renewable deals out there (in the UK, at least). If you have a pension fund, check where it’s invested; most providers should offer an investment profile that avoids the big polluters without impacting target returns - consider making the switch (with advice from an IFA, of course!). Try using Ecosia (www.ecosia. org) as your default search engine; they have a tree-planting programme linked to the volume of searches made via its platform - maybe use it to search for more ideas for making easy, impactful changes like these.
Ben: A colleague in France sent round a website where you can assess your own carbon footprint. There are loads of things we can do as individuals, from changing diet to reducing flights and car journeys.
Jerome: It can range from relatively straightforward solutions such as buying an EV, carpooling or installing solar panels on your rooftop to more proactive ones such as joining and putting time and efforts into focused NGOs.
Amos: Ultimately, I’m an optimist. I believe that renewables are now a compelling alternative to fossil fuels, not just from a carbon perspective, but also from a broader economic perspective, particularly when considering individual and international net zero commitments. Humankind is extremely adaptable, and when there’s a real crisis we’re pretty good at finding solutions.
Amos Carrington is general counsel & company secretary, Low Carbon.
Jerome Hamilton is head of legal, Japan/ Green Solutions APAC for Engie Global Energy Management & Sales.
Irina Akentjeva is a partner, Herbert Smith Freehills.
Mark Rigotti, formerly CEO of HSF, is managing director & CEO, Australian Institute of Company Directors. At the time of the interview,
Ben Hargraves was head of contract management, Volta Trucks. Volta Trucks has since gone into administration.
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