The new Green Economy: balancing profit and purpose – The Business Booster 2023 theme

April 4, 2023

The race to net-zero is fast accelerating. We are amidst one of the biggest changes we will see in modern times – a transition from the old energy economy, defined by profit, unfiltered energy sources, and monopolies, to the new energy economy, defined by purpose, sustainable energy sources and disruptive innovation.

The race to net-zero is fast accelerating. We are amidst one of the biggest changes we will see in modern times – a transition from the old energy economy, defined by profit, unfiltered energy sources, and monopolies, to the new energy economy, defined by purpose, sustainable energy sources and disruptive innovation. 

This change is being driven by a collective recognition from consumers, stakeholders, businesses, investors, regulators and beyond, that when it comes to sustainable energy, we need to do better – and faster. Though against this tidal shift, has been a challenging geopolitical backdrop unfolding that has required nations and trade blocs to dial up energy security and protect domestic interests – sometimes at the interest of sustainable progress.  

Having said this, new, positive pathways of collaboration and progress are again taking shape, but to ensure the new Green Economy can truly thrive, we must address both the opportunities and challenges that exist.  

Net-zero and industrial policy: A game theory approach

One year into the worst energy crisis of recent times, the west is responding with unprecedented measures, forging a green subsidy race between the US and the EU as industrial policy on both sides of the Atlantic look to speed up decarbonisation and foster cleantech industries at home. Industrial and manufacturing competition is being triggered through industrial policy. But how can we harness the competitive nature of energy security to drive global sustainable progress and shape the new energy economy? 

Are we ready for the new green economy?

To reach climate neutrality by 2050, the transition to the new green economy is critical – but are we really prepared? Immediate responses to energy security issues since Russia’s invasion of Ukraine have dialed back near-term progress on decarbonisation and a middle-ground needs to be achieved. Do we even have the capacity for all that comes with the green economy? What technological challenges does it bring? How can we address the skills gap to support the transition? New processes will also need to be set up that ensure cash arrives where and when it is needed. While these challenges may seem daunting, a practical focus on action can help us tackle them head-on.  

Net-zero industry: balancing profit and purpose

To drive progress from the old energy economy we need to accelerate the decarbonisation of hard to abate industrial value chains. Many initiatives are starting to tackle this challenge, but we cannot completely disregard the old – a balance between profit and purpose needs to be met. Various initiatives and players are making strides to decarbonise industries, create new economies and spur job creation at the same time. What can we learn from these practical examples to achieve more, sooner? Will we remain locked in competition or are opportunities in co-opetition to be found?  

Capital: A new way to finance green innovations and industry wanted!

 The cost of financing sustainable energy innovation is monumental and must be supported by both the public and private sectors. Looking at public funds, we have positive initiatives from the European Union such as NexGeneration and RePowerEU, however deployment is still a challenge. Do we need new ways to deploy public funding, or do we simply need more money? What is clear is that as we transition to net-zero we need evolving financial models that channel private investment towards the transition, which at the same time boost public funds and accelerate government initiatives. These models need to look beyond the green premium of today and pave the way for thriving returns in the future. As a result, we will attract more and more players within this field, increase competition, keep up with demand and create a sustainable industry to lead the new energy economy. 

Entrepreneurship: Decarbonising the food and agriculture Industry

The food value chain touches many aspects of the energy transition and agriculture has a crucial role to play in reaching energy and climate objectives. Aspects in the food industry such as the energy intensity of food production, fertilisers, water usage and shortages, meat production and relatively conservative industry players all present issues in the new green economy.  

Labour: Skills shortage for the new Green Economy

The world is changing fast, but can the workforce keep up with it? To reach a net-zero carbon economy, new policies and innovations are developing at a rapid pace. However, this is of limited use without an adequate skilled workforce to facilitate large scale implementation. According to McKinsey, 18 million workers will need reskilling and upskilling to fulfil 5 million new jobs, many of which are within renewable energy (1.54 million), agriculture (1.13 million), and buildings (1.1 million). Ultimately, the transition to decarbonising the economy and creating a sustainable future demands a new approach to upskilling and reskilling the workforce.

Land: Critical raw materials – threat or opportunity?

Critical raw materials are essential for the net-zero agenda. Looking at the storage industry alone, Europe is almost entirely dependent on importing the necessary raw materials for batteries. This extreme dependency creates several risks and makes the supply chains for the energy industry highly vulnerable. So although we may not always be able to supplement a toxic dependency for a raw one, as global demand increases dramatically how can we see this as an opportunity? By using a circular economy approach through innovation, or through the use of new, more abundant materials, new markets will open as well as secure access to an affordable and sustainable supply of critical raw materials. 


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