Transcript:
MATHIAS STECK In the news we read recently that the UN Secretary General during the climate meeting in Abu Dhabi has mentioned that the world is facing a grave climate emergency, and this is a really interesting shift in the discourse around climate. At the time of COP21, we were discussing climate change and now we have clearly stepped up to call it a climate emergency, which is underpinned by recent events where cities, like New York in the US or Sydney and Hobart in Australia, have actually declared climate emergencies.
So, this makes clear that there is tremendous pressure on industries to recalibrate the sustainability measures to address that climate change has become a climate emergency and this is even more so true for the energy industry. If we look back at COP21 it was apparent already then that if we want to meet our emission targets that no new coal fire power plant should come online. That has not happened that way for sometimes understandable reasons since countries just hadn’t developed that far yet, but it’s even more true now that going forward, we cannot allow carbon emitting assets to be built if we want to battle the climate emergency.
So, the energy industry is challenged to once again deliver on the traditional energy trilemma to supply affordable, reliable and sustainable energy and to do this the energy industry has to bank on new technologies and powered by digitalization, Internet of Things, demand response, all this. But there is a challenge around this as well and we hear that 75% of the energy companies are reluctant to adopt these new technologies and this is driven by the increasing cyber threat. Recent news about the cyber-attack on Norsk Hydro show us the economic impact of cyber threat. So, their losses have built up to about £52 million US dollars by now, but there are even worse scenarios you can think of.
There was a German study a couple of years back talking about the impact of large-scale long duration power outages and their impact on society. So, you will see that only after days without energy, especially without electricity, our structures as we are used to are breaking and life for people gets very uncomfortable. So, that is the second threat the energy industry has to have in mind when they are talking about stepping up in the game to make their assets more efficient to deliver on the requirements coming from climate and climate emergency.
Now, the way to address this is that we need to design assets in the future or assets which are retrofitted to be future proof, to be able to handle these upcoming new challenges. That fits very well into DNV’s purpose of safeguarding life, property and the environment and we have in fact delivered future proofing services to our core industries - maritime, oil and gas and energy - but we need to see much more of this. So, that entails that already in the planning and design stage or in the retrofitting stage, where that is planned, that you do have the assets you are already aware of that will come in mind but that you also keep the structure flexible enough that you can adopt it to new threats, which may not yet be known.
Now, how do we get there? I think there is three important steps. The first one is we have to create awareness. People have to be aware there is a real climate emergency, people have to be aware there is a real threat coming from cyber. So, whatever we do, we cannot look at these aspects in isolation.
The second thing is that governments have to step up with new regulations, with pressures and incentives introduced to make industries moving into the right direction and to kind of create a level planning fields so that there’s also a fair chance for everyone to deliver on these challenging requirements.
And then finally, coming back to how to implement it, it is important that we change our thinking during the planning and design phase of assets that we are not just thinking about the current or the immediate business ahead and the immediate challenges ahead, but that we are prepared for a future where there are big challenges whose impact we do not fully understand and see yet and there maybe also new threats coming on. So, the industry is challenged to address this right now to make sure we can tackle the risk coming from climate emergency and cyber threats.
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