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Brit and Aussie companies making climate change action their business

Michael Ward, British Consul-General & Deputy Trade Commissioner APAC, UK Department for International Trade

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This November marks one year to go until the UK, in partnership with Italy, hosts the COP26 international climate summit. To mark ‘One Year to COP’, the UK Government, together with our partners in Australia, has organised a series of events and business engagement initiatives from 16 – 26 November 2020 to raise awareness of the opportunities to take climate action.

As COP26 hosts, the UK’s ambition is to reach an inclusive, fair outcome that accelerates climate action. As an advanced economy, rich in renewable energy resources and a strong tech ecosystem, Australia has an important voice. For those looking at climate action primarily through the prism of government it is easy to underestimate the potential Australia offers. As well as working with Federal and State Governments, the UK is prioritising links with businesses and communities who are already taking measures to achieve this. Governments and businesses alike are now increasingly aware of both the economic and environmental benefits of green growth and investment.

One of the great things about my job and the work of our team at the UK Department for International Trade (DIT) is that we get to connect with great organisations in the UK and Australia. Organisations that have the technology, finance, influence and determination to make a difference on the journey to net zero. We are proud to support organisations that make sustainability a priority of trade and investment opportunities between Australia and the UK.

A commitment to sustainability

Corporate commitment to sustainability and the leadership to deliver it are fortunately in plentiful supply in the UK and Australia. Lendlease have recently announced new sustainability targets, including becoming a 1.5ºC aligned company. They have already achieved carbon neutral status across all their Australian construction sites. In London, their Elephant Park project was the first UK project to be accepted by the C40 Climate Positive programme, and their debut green bond raised $500 million to be earmarked against green buildings in their global urbanisation portfolio. Jaguar Land Rover have achieved two years of carbon neutral operations across their UK facilities and have committed to reducing the environmental impact of their products. It is great to see the Jaguar I-PACE electric SUV out on the streets of our cities.

The energy sector is also proactive. In June 2020, the Australian Energy Council, which represents Australia’s major gas and electricity companies, endorsed an economy-wide net zero emissions target by 2050 for Australia, whilst BP have already committed to zero net carbon emissions by 2050. In partnership with the Federal Government BP is assessing the feasibility of an export scale hydrogen plant in Geraldton, WA, and BP’s Lightsource has eight significant solar farms under development in regional Australia.

Growth in green

Two-way investment in renewables is booming. The UK’s Octopus Energy recently announced a £300 million (A$543 million) strategic partnership with Origin Energy to power clean energy expansion through Octopus’s world leading tech platform. As 31 March 2020, Macquarie Group managed $A20.4 billion of renewable energy assets and arranged $A9 billion in renewable energy and energy efficient projects. This marks a 12.5% increase in investment and financing compared with the prior year. They have also been carbon neutral across all their direct operations since 2010.

New, innovative green tech companies from the UK are creating solutions to tackle a broad array of environmental and climate issues. Desolenator, for example, have developed a solar powered water desalination system and UK company Petrofac, have been awarded a contract to support Australia's largest commercial-scale green hydrogen project in WA.

A win-win

But it’s not just the positive impact on the environment that is motivating these companies to act. Analysis of over 300 of the world’s largest companies found that those with strong environmental, social and governance (ESG) operations are more profitable and valued more highly than their competitors. They are more likely to experience positive impacts across multiple aspects of their business including employee satisfaction, recruitment, public perception, and business growth.

The economic risk of missing out on growth opportunities is also compelling. Analysis by the Investor Group on Climate Change (IGCC) found Australia would unlock investment of $63bn over the next five years if it focuses on achieving a target of net zero emissions by 2050. The biggest investment opportunities from now to 2050 lie in renewable and clean electricity production ($385 billion) and domestic green hydrogen ($350 billion). It was great to see the announcement on 9 November of NSW’s $32bn Electricity Infrastructure Roadmap to deliver renewable energy zones by 2030.

This week Prime Minister Boris Johnson has set out 10 Point Plan for a UK Green Industrial Revolution. Covering clean energy, transport, nature and innovative technologies, the plan will mobilise £12 billion of government investment to create and support up to 250,000 highly-skilled green jobs in the UK. Green and sustainable growth is a priority across all parts of British society and government. Within DIT, we are focused on supporting UK businesses to grow internationally in a sustainable way and identifying international investment opportunities to support the UK in achieving our target of net zero emissions by 2050. We also want to ensure that the rules governing international trade, including free trade agreements promote clean growth, support trade in low carbon goods and services and reaffirm our commitments to the United Nations Framework Convention on Climate Change (UNFCCC) and the Paris Agreement.

Read more climate and sustainability articles on the UK in Australia COP26 page.

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