The debate on the regulations and changes in the context of climate change often takes on almost pathological characteristics. There are complaints about a lack of competitiveness, rising energy costs, increasing uncertainty among consumers and companies due to stricter climate targets. As Bosch CEO Volkmar Denner points out, the argument of the “limits of technical, economic, and social feasibility” that are claimed to be reached if even stricter limits are set for whatever.
In short, the debate is characterized by defensiveness, fear, perhaps even incapacity. However, it is usually overlooked or even consciously hidden that the shift towards a different, sustainable form of industrial production has long been taking place on a global scale.
Pressure creates Change
Countries like India and China, which together account for almost a third of the world’s population, are increasingly promoting technologies that help to reduce air pollution, contaminate rivers and poison people. Why? Because they are under pressure.
China is investing massively in research to develop climate-neutral technologies. Faced with much more serious pollution problems than here, the government was forced to act. Every day 4000 people died of respiratory diseases, and in 2013 the air in Beijing was literally staring at dirt. At the end of 2013, according to the Asia director of the US environmental protection organization Natural Resource Defense Council, the government had initiated an action program worth 200 billion euros.
India is focusing strongly on renewable energies. In the southern Indian state of Karnataka, 700,000 square meters of solar cells have been supplying the 72,000 people in the region with electricity since the beginning of 2019. Industrialization and the country’s demand for energy is also forcing to take progressive action here. By 2022 the Indian government wants to increase the production of renewable energies to 175 gigawatts. This represents a 50 percent share of the total energy mix
Cash flows greener
How are such gigantic projects financed? This brings the second trend of global change into play. Institutional investors such as the investment company Thomas Lloyd invest in such mega solar plants as in India and have bought a company specifically for the implementation. Overall, 72 percent of institutional investors in Germany take sustainable factors into account when investing. Worldwide, 43 percent of investors are planning a moderate shift of their financial resources away from fossil fuels and 6 percent are planning a dramatic shift of their financial resources away from fossil fuels towards renewable energy sources.
In addition, regulations at national level are casting their long shadows ahead. Despite all the delays, the permitted limits for dirt of all kinds in the environment are nevertheless falling. Slowly but surely.
WHEN ELEPHANTS CHANGE DIRECTION
Such global shifts in money and power have consequences. Slowly the first elephants of the economy are also starting to move. While on the political level, depending on their attitude, climate change is being negated, smoke is blown or progressive partners are being sought to save the earth, the strategies of large companies are changing.
BASF CEO Martin Brudermüller is planning to build a climate-neutral factory in India and wants to double sales volumes by 2030 without consuming an additional ton of carbon dioxide. BASF is still a long way from being climate-neutral by then – but it is a start.
He is not doing this because he finds it so incredibly ecological. Rather, Brudermüller fundamentally sees the need for the company to be a pioneer in climate-relevant technologies in Germany. Otherwise China will take over this role.
The important role that technical innovations play in this race is illustrated by the example of the struggling steel group Thyssen-Krupp. With the help of federal funding and in a large-scale research cooperation with 16 partners such as the Fraunhofer Institute, the consortium succeeded in developing a technology to convert carbon dioxide from the exhaust gases of steel plants into raw materials for the chemical industry.
The pilot plant called Carbon2Chem produces methanol and other simple basic chemicals. They can be used to manufacture other products of industrial societies, such as silicone. According to the company, 50 steelworks worldwide would be suitable as potential customers. In addition, there are other markets such as cement plants, also large CO2 centrifuges and other factories with high emissions. Of course, such a plant only works if electricity from renewable sources is used, otherwise the energy balance would be a disaster.
The Swedish furniture company Ikea shows how this can work. The company is now energy self-sufficient. According to the World Economic Forum, Ingka Holding has invested 2.5 billion euros in the past ten years to build wind farms, solar cells on the department stores and solar parks. The result: the company’s own renewable energy sources now produce more electricity than the holding company consumes.
In principle, the market for sustainable technologies is huge. Depending on estimations and definitions, tomorrow’s suppliers can expect sales of between 1.5 and 5.9 trillion euros in the next decade
CHANGES BRING OPPORTUNITIES
Whoever takes the leap has the chance to define new markets for himself. In the language of management theory this procedure is called Blue Ocean Strategy. One identifies a need, minimizes the risks, is innovative and uses new ideas and concepts to go where no one else has gone before. Into a self-created, new market.