Euro Execs Extend Net Zero Timescales Amid Energy Cost And Supply Crunch

Chief execs in key European countries are pushing back on net zero commitments to focus on their core business, in the face of a volatile energy market with rising costs and supply issues.

These potentially worrying findings come from a survey of 400 CEOs at companies with a turnover above €200 million ($214 million) from across the UK, Germany, France and Italy, in high-energy industries including datacenters.

It claims more than 95 percent of respondents have now altered their planned timescale for reaching net zero, in response to recent energy market upheavals. Half extended their time to get to net zero, 37 percent adjusted short-term goals but were otherwise on track, 9 percent accelerated their goals and 4 percent kept their plans unchanged.

The survey, conducted by research org Censuswide on behalf of industrial energy solutions biz Aggreko, found that cutting energy costs and delivering a commercial advantage were the top priorities for industry chiefs, and perhaps not surprisingly, only 12 percent cited speed of decarbonization as their prime concern.

However, the report warns that in the EU at least, environmental regulations have "shifted up a gear" with the Corporate Sustainability Due Diligence Directive coming into force this summer. This "requires businesses to identify and address adverse environmental impacts across their entire value chain," the research notes, meaning corporations must change how energy is procured and usage is reported.

The report also claims that internal debates are holding back investment into greener tech, with a quarter of respondents indicating that stakeholder support was the main challenge. Despite this, 80 percent expect to increase investment in their energy transition over the next 12 months, even if most of them will only raise budgets marginally.

Most corporates have already put in place some form of decentralized energy solution, according to the survey, because of market volatility and "the frailty of Europe's grid network." This refers to power generated on-site rather than being drawn from the grid.

According to the survey, more than 90 percent of respondents in the UK and Germany already have some form of decentralized energy in place, which seems a lot to our mind, although sites such as datacenters have to have a backup power source in case of disruption to grid supply.

Of those with decentralized energy, 54 percent of the CEOs were looking to expand it, and a third indicated no plans to change it. 11 percent had no provision but are planning to invest, while only 2 percent had no plans.

As far as datacenters go, power supply problems are an acknowledged and growing issue. Last month, one of the UK's major commercial property developers blamed problems with securing power for holding back investment in new-build datacenters, and the same applies to operators wishing to expand their capacity.

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At the same time, some large corporations stand accused of "greenwashing" and not doing enough to limit their emissions. Greenpeace also published a report last year claiming that many tech companies were only paying lip service to environmental goals. Now it seems that some European businesses are letting net zero goals slip in the face of other issues.

The report concludes that challenges faced by Europe's high energy users are daunting. Increased demand is being held back by rising energy costs and reliability issues with the grid, and in response many are responding with delayed net zero plans at a time when accelerated action is needed.

However, while net zero plans may have been delayed, they have not been derailed, and the survey claims the desire among execs to drive progress is clear, even if the current conditions are unfavorable. ®