Why it matters
Electricity is at the heart of the global energy challenge. As an emitter of approximately 40% of the world’s CO2 emissions, the sector plays an essential role in ensuring an effective transition toward a low-carbon economy.
While the electricity sector is experiencing sustained growth, it is also grappling with fundamental issues of security, reliability, affordability, environmental impacts and basic access. Concerns over fuel supplies and barriers to alternatives are accelerating the use of coal despite the impact of its emissions on the global climate. Reliance on aging and over-stressed networks is increasing the risk of blackouts. More than a billion people still have no access to electricity. These trends are not sustainable.
The WBCSD’s sector project on Electricity Utilities brings together ten leading utilities from around the world to better understand these challenges and explore policy needs and potential business solutions.
The business case
Demand for electricity is escalating against a backdrop of unprecedented calls to safeguard broad environmental and social interests.
With more and more blackouts and brownouts in both developing and developed countries, the need for long-term planning to ensure electricity security is necessary. Electrification projects in developing regions can also yield business opportunities.
Further, shareholders and stakeholders are exerting increasing pressure on the sector to manage its carbon exposure as climate policies take hold, even in those countries that did not sign the Kyoto Protocol, such as the US. Therefore, participation in the development of energy and climate policies and any new international framework will enable the sector to share its expertise and contribute to effective and efficient solutions.
Consequently, communicating with policymakers and regulators to ensure investment conditions meet the needed developments within the industry has never been more important. This engagement will enable the industry to consider their concerns, integrate their knowledge and ensure that decisions are made in a holistic manner.
Work program activities
The Electricity Utilities sector project is a multi-phase program comprising:
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Phase 1: Started in 2000, this phase saw the launch Sustainability in the Electricity Utility Sector in 2002. The report details sustainability principles and strategies for the sector, featuring case studies and best practices. It concludes with an overview of the sustainability challenges facing the sector;
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Phase 2: Here, companies took a closer look at these challenges, highlighting key areas for action, with a focus on potential technological solutions. The report, Powering a Sustainable Future: An agenda for concerted action in 2006 examined the six objectives needed to drive concerted efforts by all stakeholders;
In support of this agenda, the project developed a series of facts and trends and issue briefs on the technical options available to meet the challenges of sustainability.
Throughout 2008, the project members sought feedback on the interim report through a series of dialogues in China, South Africa and Japan – meant to inform energy debates worldwide and contribute to the development of practical solutions. The feedback received was incorporated into a final report, Power to Change.
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Phase 4: A new phase of the project started in 2011, with a focus on developing thought leadership in three areas: energy efficiency, electricity frameworks, and sustainable development in the sector. The objectives of the new phase combine sharing best practice and solutions to the current challenges in the power sector and communicating them to policy makers and stakeholders, in particular in three international platforms: UNFCCC, Clean Energy Ministerial and Rio+20.