In a recent study by Bain & Company, it’s revealed that many energy companies are pushing back their timelines for achieving global climate neutrality. Despite a surge in green investments, concerns about profitability are slowing down decarbonization efforts.
According to the study, a whopping 62 percent of energy and natural resources companies now believe that climate neutrality won’t be attained until at least 2060, or even later. This shift in perspective is largely due to the financial challenges associated with green projects.
Roch Baranowski, from Bain & Company Poland, explains, “Energy firms are eager to tackle the shift towards cleaner energy. However, they’re facing the harsh reality that these projects may not yield the returns they hoped for.”
Interestingly, the biggest hurdle isn’t technology or resources, but rather customer reluctance to shoulder the extra costs. This reluctance makes it tough for companies to justify their green investments, with 70 percent of respondents citing it as their top challenge.
Despite these setbacks, most firms are doubling down on their green initiatives. Over 60 percent of companies in regions like the Middle East and Asia-Pacific believe that investments in renewable energy and other sustainable practices will boost their profits by 2030.
North America emerges as the hot spot for green investments, followed closely by Europe. Yet, regulatory uncertainties remain a major concern, with companies stressing the need for clearer guidelines.
Looking ahead, the industry sees hope in artificial intelligence and digital technologies. With 65 percent of companies predicting significant impacts by the end of the decade, there’s a growing optimism that smarter tech will pave the way for a greener future.