1. What is Net Zero?

According to the Intergovernmental Panel on Climate Change (IPCC), Net Zero, also known as Zero Emissions, is the state of balancing the amount of greenhouse gases emitted into the atmosphere. Over a certain period, human emission activities are to be eliminated.

By 2050, to ensure life on Earth, humanity must achieve this new goal. Cooperation and effort from all parties are necessary to reach this target. Only by acting together can we effectively tackle the climate change challenge.

2. Net Zero vs Carbon Neutral

Net Zero and Carbon Neutral are both important concepts related to carbon emission reduction, but they have distinct differences. Net Zero refers to the balance between emitted and removed greenhouse gases, covering all types of greenhouse gases, whereas Carbon Neutral specifically balances emitted and removed carbon dioxide (CO2).

• Type of Gas: Net Zero addresses all types of greenhouse gases, while Carbon Neutral focuses solely on carbon dioxide (CO2).
• Example: An example of Net Zero is investing in tree planting projects to offset large greenhouse gas emissions from production. In contrast, Carbon Neutral might involve switching from fossil fuels to renewable energy.
• Characteristics: Net Zero aims for no additional CO2 emissions into the atmosphere and considers the entire value chain, from production to consumption. Carbon Neutral still involves some CO2 emissions but offsets an equivalent amount.
• Scope: Net Zero covers the entire value chain, from production to consumption, addressing indirect emissions from the value chain and consumers. Carbon Neutral focuses mainly on production and the use of clean energy to reduce emissions.
• Related Emissions: Net Zero considers indirect emissions from the value chain and consumers, while Carbon Neutral primarily focuses on reducing emissions from production and the use of clean energy sources.

Thus, Net Zero and Carbon Neutral have significant differences in scope, standards, and feasibility, with Net Zero posing a higher challenge in reducing and eliminating indirect emissions from the value chain and consumers.

3. Why Net Zero is important?

Science has shown that to minimize the worst impacts of climate change and protect life on the planet, we need to limit global temperature increase to 1.5°C above pre-industrial levels.

The Earth is currently warming by about 1.1°C since the late 19th century, while emissions continue to rise. To keep global temperature rise below the 1.5°C threshold set by the Paris Agreement, we need to cut emissions by 45% by 2030 and achieve Net Zero by 2050.

This poses a significant challenge for businesses but also creates an opportunity for them to demonstrate their commitment to a sustainable future.

4. How to achieve Net Zero

Major changes in energy production and usage or enhancing the removal of greenhouse gases from the atmosphere are essential to achieve Net Zero. Here are some viable strategies:

• Generating Emission-Free Electricity: Transitioning to renewable energy sources such as solar, wind, hydro, and biomass is crucial. Emission-free electricity helps reduce carbon emissions from energy supply and can be used with various energy sources to ensure a steady power supply.
• Using Electric Vehicles and Equipment: Replacing fossil fuel-powered equipment with electric alternatives effectively reduces carbon emissions in transportation and production. Switching to electric cars, trucks, and heating systems for buildings significantly cuts emissions.
• Using Energy More Efficiently: Optimizing energy use and implementing energy-saving measures in production processes and daily activities reduce energy consumption and carbon emissions. Advanced technologies can identify when energy is needed and when it is not.
• Removing Carbon Dioxide from the Atmosphere: Using carbon capture and storage (CCS) technologies to remove CO2 from the atmosphere and store it. Additionally, using technologies to create valuable products helps achieve Net Zero.

5. Cost to achieve Net Zero

Achieving Net Zero by 2050 requires significant investment. According to the latest report from the Climate Change Committee, the annual cost of reaching Net Zero will account for about 0.6% of GDP in the early 2030s and decrease to around 0.5% by 2050.

Investment in low-carbon technologies will increase from around £10 billion in 2020 to £50 billion in 2050. Although this seems significant, it is a fraction of the cost of the detrimental effects of climate change globally, crucial for ensuring future sustainability and security.

6. VertZéro & Net Zero

To achieve Net Zero, businesses need to reduce carbon emissions from activities or manage reductions within their operations and supply chains while compensating for unavoidable emissions.

The first step in reducing emissions is to understand them, requiring accurate data. Companies must provide detailed and objective data reports to transparently verify these metrics. The VertZéro greenhouse gas inventory solution, part of FPT's technology ecosystem, aims to fully digitize the environmental data collection process. It includes calculating, managing, and reporting emissions, helping businesses track progress in their commitments and ensure compliance with international standards.