Tom Delay, CEO of Carbon Trust on Net Zero, COP27 & Energy Crisis

INSEAD Alumni in energy, interview series

We open our series of interviews with Tom Delay – Chief Executive of Carbon Trust – a company on a mission to accelerate the transition to Net Zero. Here, Tom explains the difference between Net Zero and Carbon Neutrality and shares key trends and challenges and his reasons for staying optimistic. 

Carbon Trust was launched with an aim to speed up the transition to Net Zero, supporting businesses and governments across multiple dimensions: “providing insights to support better decision-making, working alongside clients on implementation projects and providing certification for successful outcomes.”

Under Tom’s leadership, the Carbon Trust has been powered by the mission to accelerate the move to a decarbonised future, bringing businesses, governments and financial institutions to the table to unlock collective change across sectors. It has grown to be a global organisation of over 400 experts, attracting the top talent in the sector.

Some of Carbon Trust’s main areas of focus are energy efficiency (including waste management), renewables and commercial property. All three are interconnected: for example, waste management helps by making producers decrease CO2 by converting food waste at scale into biogas through anaerobic digestion, renewables produce clean energy needed for commercial properties and other industries and commercial property can optimise energy consumption and CO2 emissions during the construction process and when the building is occupied.   

When asked what Net Zero is, and how it is different from the now-widespread term “Carbon Neutrality”, Tom explains that the two terms are complimentary.

Net Zero is a comprehensive long-term strategy focused on reducing a country’s or a company’s emissions to an absolute minimum, with remaining emissions being captured. Investor expectations in this regard are rising year on year and companies need to respond with a comprehensive strategy. This is where Carbon Trust can bring their expertise to bear. 

Carbon neutrality, by contrast, refers to the measurement of an organisation’s or product’s carbon emissions that are “being offset to bring the total to zero at that point in time”, Tom explained. “This doesn’t really remove greenhouse gas from the atmosphere, but relies on carbon offsets that are often just avoided emissions. Examples would include funding of a low carbon alternative (renewable power) or paying to limit potential carbon emissions (deforestation). This is something that helps make an impact quickly, is easy to measure and that consumers can understand and support. But it doesn’t get the world to Net Zero, it is not enough”. 

Carbon Trust’s focus is on emissions reduction, building the route to Net Zero for companies and organisations and providing assurance that this is being done to the highest standard. 

There are two things happening right now, the first is the energy crisis in Europe. It puts an enormous focus on energy resilience at the time when oil and gas supply is compromised and prices are at record levels. It’s easy to argue the case for new fossil fuel supplies to increase energy independence. However, this won’t address energy prices in the short-term given how long it takes to develop new oil&gas sources, and it goes against commitments made towards New Zero. To reduce prices quickly we should focus on the demand side, energy efficiency and to build the lowest cost energy systems for the future we should invest in renewable power, which is now the lowest cost energy source, and storage/interconnectors to provide resilience.

The second issue of today is whether international support exists to drive global transition to Net Zero. Tom just came back from COP-27 and kindly agreed to share his fresh perspective. 

A few thoughts:

  • There was real commitment from countries on the ground demonstrating their progress: the country pavilions for Chile and Colombia were bigger than those of France, Germany and the UK
  • The aim of keeping temperature rise within 1.5C is still alive but increasingly challenged as countries realise the full scope of what this requires
  • The agreement to address “loss and damage” in the developing countries was welcome even if the initial financial commitments are modest. This has unlocked a pathway to a solution for an issue that has been debated for the last twenty years.       

To read more on Tom’s experience during COP-27 and about Carbon trust follow the link: https://www.carbontrust.com/cop27 

More on Net Zero and the difference between Carbon Neutrality: https://www.carbontrust.com/news-and-events/insights/what-is-net-zero-and-why-does-it-matter

ENGIE: Powering the Energy Transition with Data

The energy transition is upending the ways in which governments, regulators, individuals and businesses view and behave themselves. In this context, how does an energy-focused company transition its own organisation and its established ways of operating in order to be better equipped for the challenges posed by the energy transition? In this short piece, we introduce a case study which looks at how Engie, a 150-year old industrial giant leverages modern tools to better serve not only its clients but its own business units and ultimately its strategic vision. 

Theodoros Evgeniou is a Professor of Decision Sciences and Technology at INSEAD. Together with his colleague Pal Boza, a Senior Research Associate, he published a case study focused on the data and technology transition of Engie. Whilst there is much chatter about the energy transition itself, there is little focus on how energy companies can better equip themselves with tools which can aid this transition. More than being a purely technological matter, this shift entails cultural, organisational and strategic changes of significant scale. Naturally, these changes result in friction and potentially tensions within the organisation.

So how did Engie do it? In steps, or rather seasons, as we found out during the webinar with Yves le Gelard, EVP in charge of Digital and Information Systems and Mihir Sarkar, Chief Data Officer. 

The first season was described by Yves as an approach akin to fiscal stimulus whereby geographical units are provided with tools and skill sets paid for at the corporate level. These geographical units are free to choose their course of action but do so in the knowledge that selecting resources provided Engie will effectively be free of charge. 

In the ensuing season, roles are reversed and the impetus is Engie-led as opposed to being led by business units. The course of action is orchestrated centrally and is driven by three hubs located in Paris, Houston and Rio de Janeiro. 

Finally, in the last season, alignment is sought with the overarching strategy set by the CEO. 

Mihir also alludes to a stepped approach by referring to Engie’s transition from Information Technology to Digital, followed by a transition from data to Artificial Intelligence. Indeed, he concludes, data is now a raw material. 

The webinar also saw active participation from the audience, whose questions revolved around the impact of geographical and cultural differences in crafting and deploying a strategy, CAPEX allocation and the impact of cultural differences in leveraging data and AI in organisations spanning multiple business lines and countries. At the beginning of the session, Professor Evgeniou posed a key question: how will the IT/ digital/ data organisation evolve at Engie?

Tune in using this link and let us know your views at [email protected]

Announcing the re-launch of our Energy blog!

Dear Alumni,

We would like to announce the re-launch of our Energy blog!

We believe that the future of the energy sector represents undoubtedly the most significant global challenge of this historic period when international, economic and energy systems of our collaboration are put into test. As INSEAD Alumni, we remain committed to ensuring sustainability and security of energy supply while continuing the transformation to a low carbon society that will materially impact countries, businesses, and our personal lives.

Thanks to the continuing support from the Hoffmann Global Institute, INSEAD Life Long Learning and IAA.

We appreciate the support and collaboration of all the National Energy Clubs that engage via Ambition NetZero Series.

As part of our plans to develop the Alumni Energy Global Club for the benefit of our international alumni community we are creating a platform (this blog) to enhance alumni, school and external expert collaborations. 

We have few updates:

We created a space for knowledge leadership from notable INSEAD alumni working in the Energy Transition space, our past and future speakers from the Ambition NetZero Series and INSEAD academics. With the forthcoming blog articles and interviews we will be connecting experts and global leaders to share their views on most critical aspects of energy transition. 

This blog is a space where you can find up to date information about Club leadership and volunteers. Do check it out and reach out to extend your network.

We also offer room to events from National clubs and past and future events that are organized by our volunteers. You find the details under a dedicated link. 

A special thanks to those among you who have already expressed their interest and support, and those who have offered to volunteer. We encourage all of you to be in touch with us and submit feedback and suggestions.

We look forward to engaging with you through relevant, interesting and up to date content on the topic of energy transition.

Sincerely,

On behalf of the INSEAD Alumni Energy Global Club Board