Businesses More Cautious Than Policymakers Over Renewable Transition
It was clear to see the impact the Paris Climate Accords, adopted in 2016, had on public consciousness.
During the period covered by our first Decade That Matters report, monthly mentions of “net zero” more than quintupled to over 20,000 mentions per month.
This spirit shaped attitudes towards climate change and the transition to an economy based entirely on renewable energy. But it appears the seismic shifts in world affairs during 2022 have accelerated a trend in mood around global targets. Sentiment analysis of the phrase “net zero” over the past five years reveals a tonal shift.
Monthly online mentions of "Net Zero' from 2015 - 2022
As can be seen, overtly negative mentions of “net zero” online have doubled from 10% to 20% of the debate, while clearly positive mentions have declined as a proportion from 4% to 3%. This may well reflect a desire to move the goalposts beyond simply “net zero”, as we will see later, or it could depict growing scepticism around current targets.
Indeed, events of the past few years may have altered leaders’ views on how quickly the net zero transition can be made. Our survey of business leaders and policymakers in Europe and the US found that there is a notable divergence in opinion as to when this can now be achieved.
Sentiment split online around "Net Zero"
Government Goals
In light of events in Ukraine and their wider impact on the global economy, we asked policymakers when they believe their country will fully transition to renewable energy. They are largely optimistic of their countries achieving a total transition to renewables by 2050 – in fact, nearly two thirds (60%) believe it will be achieved during the 2030s at latest, with only 11% stating that it will be after 2050. A full quarter (25%) meanwhile believe it will be achieved by the end of this decade.
When do you estimate your country will fully transition to renewables?
By 2030
From 2031 - By 2040
From 2041 - By 2050
After 2050
Never
Unsure
There are some notable variances by region, however. Digging into the regional splits, we see that US policymakers are the most optimistic about reaching their targets by 2030 (43% of those surveyed), while French policymakers are the most cautious at 14%.
When do policymakers estimate their country will fully transition to renewables?
When do business leaders estimate their country will fully transition to renewables?
However, business leaders as a whole are more cautious as to when the transition will be achieved. Just under a third (32%) think it will be before 2030, while 57% believe it will be by 2050 or after. Almost one in ten business respondents (8%) think the transition will never be achieved, compared to only 1% of policymakers.
A notable national discrepancy between policymakers and business leaders is the US, and by some margin – only 16% of American executives believe the transition will be achieved before 2030, compared to 43% of American policymakers. The latter are likely optimistic in the wake of the passing of the Inflation Reduction Act of 2022 (IRA) in the summer of 2022, which focuses investment on domestic, clean energy production. But that same optimism is not reflected by American businesses.
EU businesses as a whole are more optimistic of a 2030 deadline, at 40% versus the 32% survey average (+8% versus average). Spanish and Italian business leaders are the most confident of all, at 52% and 47% respectively. By contrast, UK business leaders were the most pessimistic, with 13% saying the complete transition to renewables will never be achieved (+5% versus average).