Scotland can lead the way in tackling climate change

Our recent Global Utilities Survey showed that for the first time in the nine years history of our survey, sustainability is “foremost in the minds of utility company leaders” and that companies across the world expect to invest heavily in renewable energy in the next five years.

No action is not an option, as demonstrated in PwC’s ‘World in 2050’ report . Carbon emissions must be reduced, particularly in the developed world, in order to allow the developing nations to achieve their economic and social aspirations. The key question for Scottish business and Scottish policy makers is do we want to be pulled along for the ride, or do we want to take the reigns?

Scotland is blessed with national resources, quality academic and research infrastructure and a highly educated workforce.  This combination of factors should enable Scotland to punch above its weight in developing the technologies to reduce carbon emissions and reduce resource use, while at the same time capturing a significant share of the economic benefits that the successful businesses in this space will be able to reap.

How Denmark won

Denmark has captured first-mover advantage in the existing wind turbine market.  They hold a 40% share of all wind turbine manufacturing and the industry employs 20,000 people in Demark.  Through leveraging this experience they have been able to lead in developing off-shore wind turbines.  Latest available figures show global off-shore installations had reached 530 megawatts of production, 492 megawatts of these were from Danish origin.

Our experience of working with industry and seeing both successful and failing businesses has shown us a number of key elements for success in this space:

• Timing of investment in new technologies, products and services is crucial – it is just as dangerous to invest too early in a market where there is not yet demand as it is to invest too late and find that others have taken the first mover advantage. 
• Consistency of policy framework at all levels of government is vital – it is virtually impossible for industry to invest appropriately if it doesn’t know what direction policymakers are going to take.
• Bringing together businesses and universities in the same physical space to enable cross-fertilisation of ideas can accelerate progress of the industry as a whole.
• Ensuring that business basics such as tax, VAT, information systems, people management and financial reporting are well managed and given equal priority to innovation and scientific development is critical to the sustainable success of individual businesses.  Managing the tax cost and associated cashflows can give an organisation a competitive advantage

In summary, we believe that Scotland can lead the way in tackling climate change, contributing significantly to the global changes required whilst reaping significant financial and economic benefit for its citizens.  Clear policy making and adherence to good business fundamentals will determine whether or not we do indeed win!

Contact details
Email: Grant Hodges
Tel: +44 (0)131 260 4044