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12 Apr 2022

Challenges That Inhibit Decarbonisation

Pippy Stephenson

If we are to reach net zero by 2030 we need to make big structural changes to how we run our societies. This ‘decarbonisation’ is the process of shifting away from fossil fuels towards low-carbon alternatives and will require a lot of investment and is likely to be a very intensive process. 

What progress have we made so far? 

A PwC report found that out of the G20 countries, the UK was decarbonising the fastest in 2016; carbon intensity fell 7.7% in the UK while the global average was a 2.6% decrease. As I’ve covered in a recent article, despite not being quite where we need to be there is a growing demand for renewable energy suppliers in the UK. An article by Energy Industry Review reads, “we observe a gradual breakaway from the older core values of security, reliability, and robustness which existing energy systems were built on, to new values of sustainability, flexibility, and affordability, enabled by a completely new way of producing, delivering, and consuming energy.”

Transport is also decarbonising. London has 71 fully electric buses and 2500 electric-hybrids, making it the largest fleet of low-carbon buses in the world. Black cabs will soon be electric-hybrids and work is being put into new cycle lanes and bike parking. Paris has also been working on greening its transport system, investing in cycling infrastructure and planning to ban diesel vehicles in the city after 2040. 

Meanwhile, Iceland’s entire electricity supply is renewable, Sweden’s energy is 52% renewable and in Costa Rica renewable energy generates 98% of electricity. 

What can be done? 

The primary element of decarbonisation is moving away from fossil fuels, towards renewables. This is often discussed in relation to the energy or transport sectors but is relevant wherever there is a carbon intensive process. 

An important part of decarbonisation is investing in decentralised storage technology. The energy generated by renewables needs to be put somewhere when it’s not immediately needed, this means we won’t be wasting energy that we’ve generated before we can use it. A report by JPMorgan has stated that in certain conditions, storage technologies could reduce emissions by 60%.  

But some say it’s not enough to just reduce our emissions, we must go further and remove carbon from the atmosphere using a method called carbon capture, by which carbon dioxide (CO2) is captured and stored. Carbon capture is a growing industry that is attracting a lot of investment. However, it has its drawbacks, which I’ll talk about in the next section of this article. 

Decentralising the electrical grid could also be a vital tool in decarbonising. With a centralised grid we rely on one main source of energy, which leaves us with no backup if there is disruption on the route of energy, like a storm or a wildfire (which we’re seeing more and more of due to climate change). When we decentralise the grid, making instead many micro-grids, not only are we making a more resilient system we can also more readily rely on renewable energy. We can route solar power from where it’s sunny or wind power from where it’s windy at any given time. When it’s no longer windy or sunny, the micro-grids can share the power they’ve received with the larger grid. 

Other ways of decarbonising worth pursuing are energy efficiency improvements, using biomass as feedstock or fuel and the electrification of heat. 

What challenges remain?

Direct carbon capture removes CO2 from the atmosphere, which is a very expensive process. Direct carbon capture creates a byproduct of CO2. Due to the expense of the process companies are selling the CO2 byproduct, often to be used in the oil production process. This is obviously hugely counterproductive. 

There are ongoing discussions about the need to make the production process of all the materials we rely on such as, brick, cement, glass and plastic, less energy and carbon intensive. It is yet to be seen if this is possible. Some argue we should be switching the different materials altogether. However, a report from McKinsey found that CO2 emissions from ammonia, cement, ethylene and steel companies could be reduced to almost zero if energy-efficiency improvements were made along with carbon capture and various other methods. 

When it comes to decentralising the grid, there is opposition from energy companies as in the current system they control the sources and direction of the energy supply. 

Energy companies that deal primarily with fossil fuels are beginning to realise that their current business models will soon become untenable. Some are beginning to supply electricity alongside fossil fuels to manage this problem but with investors increasingly hostile towards companies that actively harm the planet, these energy companies will have to transition to completely different ways of operating if they are to survive. 


Decarbonisation is one of many necessary processes we must embark upon in order to reach net zero. It has many areas of great opportunity for investment. And all companies should be looking to decarbonise their business practices. 

Get a ticket to join us at Reset Connect, 28-29 June, where industry leaders, investors and innovative startups will come together to stategise methods of decarbonisation and other ways of achieving net zero.