1, 2, 3, Blast Off for The Energy Transition

It’s 2022, time for a superhuman energy transformation? Spoiler alert: You can’t. At least, not with the push of a button! The transformation needed to attain net zero is complex and massive to say the least, and there will never be a silver bullet for the energy transition.

What we have is a need for speed, and the need to effectively harness existing technologies and tools which already make us capable of transforming the energy landscape.

A report from the Intergovernmental Panel on Climate Change (IPCC) found we need to move fast and move differently. This is especially true here in Asia Pacific, which is one of the most overexposed regions to the effects of climate change. Electricity demand is set to grow by 70% in 2040 and will double by 2050. In the face of this incredible appetite for energy, how do we ensure we enough to meet the goals set in the Paris Agreement, such as reducing greenhouse gas emissions like CO2 and limiting global warming to well below 2°C?

1.??????Breaking new frontiers

Here at Siemens Energy, we want to be the sustainability leader in our industry. There is a main role to take up in the global energy story, and corporations form an important part of this chapter. Business settings foster innovation, so how can we leverage on this to role model climate action and amplify our pursuit of climate targets? We take a three-pronged approach:

• Entering global multi-partnerships
• Modernizing conventional technologies as effective transitional solutions
• Developing even more innovative, green technologies.

In line with the United Nations’ 17 Sustainability Development Goals (SDGs), we strongly support initiatives that address the specific societal and environmental needs of the countries, especially those we operate in. This ultimately contributes to the resilience and viability of these communities, so that they continue to flourish. ?

2.??????Setting our house in order

First, companies must commit themselves to ESG and integrate all three dimensions – environmental, social and corporate governance – in their strategy.

Importantly, our commitment is also bolstered by our stakeholders, and it shows in how ESG considerations already have an impact on our tenders, products, services, our investment decisions. We fully believe that disclosure is key - what gets measured gets managed.

Under our Sustainability Program, we systematically manage, track, and measure our performance on each and every target on a regular basis to testify to the progress we’ve made . We need to extract meaningful and valuable data – both as a basis for our decision-making, for example when it comes to investment decisions and innovation, but also for our shareholders who want to make the right investment decision.?

Being sustainable also means recognizing inclusion and diversity in our workforce as an asset. The same goes for integrity and compliance, which guides all our decisions and actions. It’s not enough to commit yourself to ESG targets - sustainability is a task for everyone. This new and profound shift requires an elevated awareness amongst our employees.

I’m personally looking forward to taking part in a local tree planting event on Friday, organized specially for our employees to foster a deeper appreciation and understanding of sustainability. In partnership with Singapore’s National Park Board (NParks), we would plant 200 trees by end of 2022 to reduce building emissions at the local office.

It’s safe to say that responsible business practices form the cornerstone of our business at Siemens Energy. It encompasses the values of our corporate culture, from rigorous compliance with occupational safety and health measures to an unequivocal commitment to human rights.

3.??????A wave that grows

Our ambitious climate goals throughout the value chain are backed up with dedicated efforts to fight climate change. The most important goal internally is to make our own operations climate neutral by 2030, and we are proud to announce that Siemens Energy will become climate-neutral in its own operations as early as 2025, five years earlier than previously planned .

Having said that, our portfolio is absolutely going to change going forward. We focus our R&D investments of €1 billion every year on technologies that are relevant in a decarbonized energy world. ?

We’re constantly transforming our portfolio, which includes shaping the emerging hydrogen market right from the get-go. Siemens Energy has installed a 1.25MW Silyzer in Tonsley, South Australia , in support of government’s goal of producing hydrogen at <$2 per kg and exporting hydrogen from renewable sources by 2030. With electricity exports from Australia expected to reach up to $2 billion per annum, building a hydrogen economy will have a profound effect towards a low carbon gas supply. ?

As of the end of 2020, we have made the decision to offer no new business with coal-fired power plants and committed to the expansion of transmission technologies and SF6-free products. This is particularly significant for India, which operates on a coal-based power industry. In the push for cleaner power generation, we will continue to explore LNG and renewables as preferred solutions.

In the context of the ASEAN region, its limited capacity to meet demand with locally produced renewable energy has opened avenues for closer collaboration and interconnectedness via the development of regional grids and LNG terminals to improve access to energy.

4.??????Doing more with what we have

We will need a diversity of technologies, including conventional ones for this transitional time. But we cannot do this alone. Above all, we need more speed – in approval procedures, in attracting massive private capital, in creating business models and legal frameworks, and gaining society’s support. To accelerate the energy transition to a target-hitting level, we need to do more with what we have and focus on coming together. Subsidies and incentives are great to trigger initiative, but they cannot finance the energy transition for the long-term. By bringing stakeholders together to shift gears, corporations can close the gap between policy objectives and market activity.