Utility Week

14 | FEBRUARY 2022 | UTILITY WEEK Energy retail Event Energy crisis could spur transformational change At a dinner hosted by Utility Week and Charles River Associates, senior industry figures agreed the energy sector has a duty to pursue net zero despite the current meltdown in the energy market. T he UK energy sector has a "golden opportunity" to engage consumers in playing an active role in decarbonisa- tion, despite current turmoil in the retail market. Climate consciousness among the pub- lic is at an all-time high, the government has committed to ambitious net-zero targets and financial institutions are increasingly focused on sustainability. It makes the timing of the current crisis in the energy market especially cruel. At a moment when suppliers should be engag- ing their customers on the exciting oppor- tunities the energy transition represents, they are instead forced to manage fears over eye-watering increases in bills and a wave of business failures. It was in this context that Utility Week and Charles River Associates brought together leading figures across the energy retail sector for an exclusive Chatham House discussion. The event was held following the close of the COP26 climate conference at the end of last year and aimed to discuss whether the high level of interest in sustainability could be translated into tangible action on individual carbon footprints. How can the passion that Greta Thunberg, David Attenborough et al have inspired be capitalised on in day-to-day life and in the less glamorous areas of heat, transport and flexible use of energy? While the debate was conducted in the heat of a meltdown in the energy retail sector, there was no shortage of positivity among those participating – representing everyone from the largest incumbents to the most nimble of disruptors. As one senior figure at a large supplier put it: "There is a huge opportunity around the consumer and their awakening. I wouldn't say they're fully awake yet but they are stir- ring from a slumber. This opportunity to build on that, the focus the net-zero conver- sation and more recently COP have brought, is exciting. There's a potential to use that as a catapult for change. Our challenge is not to let that moment pass." But with such intense focus on supplier failures and soaring bills, can retailers real- istically position themselves as a valuable partner to the consumer in ensuring a ben- eficial and ultimately cost-saving energy transition? A representative of one of the incumbent suppliers believed it can, saying: "It's impor- tant to remember never to let a good crisis go to waste. We can turn this into a good oppor- tunity. The need to reduce energy use is front and centre. It's not being taken for granted. We might have wished for another way to get people's attention but now we have it, let's not waste it." Did COP turn the dial? The debate began with an assessment of the long-term implications of the COP26 confer- ence on both policy direction for net zero and the willingness of the public to play an active part in the decarbonisation journey. There was agreement among the group that COP represented a turning point in the mindset of financial institutions, who now appear to see themselves as active players in tackling climate change. Former Bank of England governor Mark Carney, now UN special envoy on finance and the prime minister's finance adviser in the run-up to COP26, used the conference as a platform to announce that $130 trillion (£95 trillion) of private capital was poised to be deployed in the climate fight. The commitment from the 450 members of the so-called Glasgow Financial Alliance for Net Zero was treated with some scepti- cism in November. But, perhaps unsurpris- ingly for a group of business leaders, the pledge was given credence among Utility Week's guests. "You always follow the money," said one. "When the money starts to shi¤, that's when change really starts to happen. "Mark Carney was much maligned for the figure he came out with at COP but back in 2014 he was talking about climate change as a systemic risk and he was one of the first prominent people in finance to say that. So maybe he's right now as well. I choose to believe he is." But is there a risk that the high profile of net zero and the avalanche of corporate com- mitments, however genuine, gets lumped into Thunberg's memorable summary of more "blah, blah, blah"? Our resiliently glass-half-full group refused to be deterred by this, with one leader of a mid-sized supplier countering that scep- ticism is healthy. They posited that expecta- Supplier failures could herald a much-needed shake-up of the energy retail market

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