The need for businesses to move quickly towards net zero carbon emissions becomes clearer with each passing month. In April, the UK government accelerated its targets for the nation, pledging a 78 per cent cut in carbon emissions by 2035 as part of its existing goal of net zero by 2050.
But canny companies are setting their own, more ambitious milestones. What was once seen by business as a cost – the need to mitigate risks associated with climate change – is morphing into a prospective social and commercial benefit. This is a golden opportunity to develop innovative low-carbon products and services, and help build a brand new decarbonised economy. Leadership in this area will be rewarded by customers, employees and investors alike.
Real progress is being made, and it’s increasingly well understood
that the actions of one business can have a positive effect on others. The shift by major power companies towards renewables will help to provide the infrastructure that business needs to reduce its own carbon footprint.
More and more companies are accelerating their move towards net zero emissions. In the first of a three-part series, we outline what a carbon neutral world will look like, and how businesses can change today in order to thrive tomorrow
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This series of articles will help businesses answer these vital questions. Starting with the first one, we have identified what four key areas of the economy might look like in a net zero world:
Seize the future
net zero world
What does my market look like in a net zero environment?
1
2
3
4
What is my business model for succeeding in that market?
What changes should I make now to prepare for success?
What supporting conditions will I need, and how do I go about winning them?
Discover more
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Brits love to shop. Over the years, the UK has been described as both a nation of shoppers and a nation of shopkeepers – so it’s no surprise that our supermarkets have been among the businesses leading the charge on net zero.
All of the big four – Asda, Morrison’s, Sainsbury’s and Tesco – have made bold net zero commitments and are following through with real action. These large businesses understand that opportunities arise when consumers are impatient for change.
A survey of consumer attitudes conducted by Deloitte in March revealed that nearly 1 in 3 people claim to have stopped purchasing certain brands or products because they had ethical or sustainability related concerns about them. Consumers want brands not just to operate in a more sustainable way, with nearly 2 in 3 wanting brands to reduce packaging, but also to be more transparent about it: 50 per cent want information on how to recycle and 46 per cent need clarity on sourcing of products.
Tesco is tackling the issue of packaging waste with its Four Rs campaign to remove, reduce, reuse and recycle – in particular via an innovative partnership with sustainable delivery service Loop. Loop provides Tesco shoppers with access to their favourite products delivered in durable reusable packaging, which can then also be returned when empty for refilling and reuse.
Energy use is also being tackled in store, where even apparently small details can make a big difference: innovative new F1 derived refrigeration tech will keep cold air where it is wanted – in the chiller cabinets, not spilling out into store aisles.
Morrisons is working with suppliers of meat and fresh produce on a net zero farm model, which will look to decarbonise all aspects of agriculture from soil health, planting and the best breeds of animal to rear, to low-emission buildings, feedstuffs and fertiliser use.
Sainsbury’s is switching to low-energy LED lighting in many stores and has committed an extra £1bn to meet it 2040 net zero target. Meanwhile Asda’s “Green price promise” ensures that loose and unwrapped produce will not cost more than the wrapped equivalent.
Global supply chains with high carbon emissions built into old-fashioned transportation and production methods will increasingly be replaced by locally sourced goods that minimise food miles, produced using innovative low carbon techniques. Vertical farming – using soilless hydroponics technology to grow fresh produce with minimal environmental impact in redundant urban spaces such as vacant office buildings and even disused underground stations – will enable more food to be grown in cities, near where it is consumed. Online grocer Ocado has already invested millions in this fast-growing sector, which is predicted to be worth £15 billion in sales annually by 2026.
However, in a fiercely competitive sector, net zero also creates opportunities for brand-new players. Take the Clean Kilo, the UK’s largest zero-waste store, which set up shop in June 2018 and now has two branches in Birmingham’s Digbeth and Bourneville districts. The Clean Kilo addresses the issues of carbon emissions from plastic, paper and metal packaging by selling only loose and unpackaged goods. It’s “back to basics” eco-shopping where customers bring their own reusable containers to be filled and weighed in store.
So what might the net zero supermarket of tomorrow look like? It will probably be smaller and offer less parking as customers order online for low-carbon delivery via EVs or robots. Packaging will be dramatically reduced, and what there is will be made of sustainable, reusable materials. Food waste will be eliminated and goods will carry a carbon “kitemark” to guarantee their green credentials. Meat will be far less prevalent on the shelves as plant-based or lab-grown alternatives replace it in our diets.
Over the past 30 years, the UK’s supermarkets have been hugely successful in reducing the cost of the food we eat, without sacrificing quality. Their big opportunity for the next 30 years is to do the same for carbon emissions, so that food – and the supermarkets’ business models – can achieve net zero.
NET ZERO Supermarkets
Vertical farming,
which uses soilless hydroponics technology to grow fresh produce in
vacant buildings
or even disused underground stations, is expected to be
worth £15bn by 2026
£15bn
We live in a world of manufactured goods that we all rely on in our daily lives, from cars, trucks and aircraft all the way to smartphones, tablets and laptops. Manufacturing them provides many thousands of jobs and billions of pounds in export revenue for the UK economy, but it also generates some 21 per cent of the country’s carbon emissions, according to the manufacturers’ organisation Make UK.
Decarbonising manufacturing is both an enormous challenge and
a huge opportunity when it comes to creating a net zero future.
A challenge because of complex and integrated supply chains that cross many national borders; the sector’s historic reliance on energy-intensive raw materials like steel and aluminium; production processes which often involve high temperatures and pressures; and the need
for capital-intensive plant and equipment with long investment cycles.
And yet an opportunity because of the tremendous potential for creating new value through collaboration between suppliers and customers; innovation around energy efficiency and low-or-no-carbon materials and processes; and the use of smart green financing to accelerate results by bridging the investment gap.
And while policymakers have largely focused on quicker wins in less complex parts of the economy to date, regulation to promote low carbon manufacturing is inevitable – and the time to act is now.
Pressure from consumers and shareholders to decarbonise is already growing, and firms are becoming increasingly aware of the opportunities it presents – according to Make UK, nearly half of the country’s manufacturers are actively investigating net zero as a business opportunity.
Many are already reducing their energy consumption and boosting competitiveness through the use of modern, more efficient, plant and equipment, increasing their use of renewable energy and looking to develop innovative new sources of low-carbon power such as hydrogen and industrial-scale battery technology.
The next steps towards net zero manufacturing will require a low- or no-carbon imperative to be built into every stage, from materials and sourcing, through design and manufacture, to operations. Alongside digital technology and the internet of things, net zero will form a cornerstone of the coming Industry 4.0 revolution.
Big name manufacturers are already responding to the call – among them giant US carmaker Ford, which employs more than 13,000 people in the UK. It is investing $22 billion worldwide in electric vehicles to help meet its pledge to go net zero by 2050, announced last year, and all its factories will be powered by renewable energy
by 2035.
The companies that will thrive in this new and still uncertain and shapeshifting world will be those that can form a strong vision of
their role in a net zero future, while also monitoring events as they unfold in order to make sound capital investment decisions and build value-creating partnerships and alliances. It’s a complex journey, but the potential rewards are great for those who are prepared to take steps today.
NET ZERO
MANUFACTURING
Manufactured goods account for 21 per cent of the UK’s carbon emissions. It’s one of the hardest sectors to decarbonise, but also presents some of the greatest opportunities
21%
The material world may grab most of the headlines when it comes to net zero, but in reality decarbonisation is just as much about people as it is about stuff.
While the consumer of 2021 talks a good game on climate change but doesn’t always act on their stated eco intentions, a generational transformation in attitudes over the next decade or so has the potential to change all that.
Generation Z, who will be the net zero consumers of tomorrow, are far more likely to demand that brands embrace change: according to a March 2021 survey by Deloitte, 45 per cent of this age group have stopped purchasing certain brands because of ethical or sustainability concerns, and 50 per cent have reduced how much they buy.
By the 2030s aspirations will have flipped – mass consumption will be increasingly viewed as excessive and selfish. Products will be designed to last and from 2025, circularity and reuse move into the mainstream. No longer will purchases be driven by the desire for throwaway “fast fashion” clothes or the latest smartphone. A new form of socially responsible conscious consumption will become the norm, centred on items that have a lower lifetime environmental impact.
In clothing, for example, that means using sustainable resources to produce high-quality “classic” styles that last for years and look good in any situation. Premium prices will be offset by the green cachet, and by clothing rental services that hire sustainable designer gear for special occasions.
But consumers can only act on these aspirations if they have the knowledge they need to make better purchasing decisions. In a net zero world, transparency will become a competitive advantage, with customers actively choosing those brands that are open about their overall carbon impact, and which help to educate their market, not just sell to it.
Across all sectors, consumers will travel less to shop, instead using online services to order and have goods delivered to their door direct by low-carbon electric vehicles, cargo bikes and drones. “Flight shame” – already an emerging phenomenon in 2020 – will have become a social norm. Domestic staycations will increasingly replace foreign travel, with flying used more for infrequent, experience-rich long-haul trips.
The concept of rubbish will also change dramatically – what we pay to throw away today will have a cash value tomorrow. In 2030 consumers may well have an app to sell their “rubbish” and supplement their income, because businesses will no longer regard waste as a problem to be disposed of but as a valuable and tradeable resource.
Ultimately this will lead to an entire new model of consumption, the circular economy, where “waste” products are fed back into the system as raw materials and where goods are increasingly designed for second, third or even fourth “lives” after they have served their original purpose.
The central tenets of consumer business today – that the customer is always right, and that convenience is king – will be reimagined in an era shaped by climate change. Consumers themselves will become increasingly aware of their role in persuading businesses to change by choosing sustainable goods from sustainable companies, but systemic shifts will also have to be prioritised – over the next decade, businesses have a responsibility to lead their customers towards the net zero future.
NET ZERO
Consumer
NET ZERO Supermarkets
Net zero manufacturing
net zero consumer
NET ZERO HOMES
Nearly half of UK consumers already make conscious
brand choices based
on their environmental credentials, and
that proportion is set to rise as Generation Z ages and its buying power increases
43%
Billions have already been invested across multiple sectors, capital that is starting to yield tangible results in ways that would have seemed impossible only a few years ago: for example, the fossil fuel technologies we have relied on for transport and heat for over a century are being rapidly superseded by lower carbon alternatives. Electric vehicles and hybrids, with the prospect of hydrogen power for both vehicles and heating, are coming up fast.
The forthcoming COP26 conference in Glasgow in November is being viewed as a high profile chance to accelerate that progress. Doing so will require a major rethink of the way business is conducted and the assumptions made around capital planning and finance. A recent World Economic Forum paper, Aligning to Net Zero, highlights four big questions CEOs should ask themselves this year:
The UK government has accelerated its targets, pledging a 78 per cent cut in carbon emissions by 2035 on top of its existing goal of net zero by 2050
78%
We tend to equate carbon emissions with things that move under their own power, such as cars, trains and aircraft. But some of the biggest prospective wins for net zero are actually to be found among those least mobile of objects: the buildings we live and work in.
The built environment is responsible for almost 40 per cent of the UK’s total carbon footprint, according to the Green Building Council. And with government targets to build an additional 300,000 homes by the mid 2020s, the race to decarbonise the sector is on.
Why are our buildings – and our homes in particular – so carbon intensive? Partly because of the materials traditionally used to build them: bricks, concrete, steel and cement all require large amounts
of energy to produce. And partly because older homes in particular are nothing like as energy efficient to heat, cool or power as they could be.
Modern methods of construction using factory-built panels made of low-carbon materials can slash the embodied carbon in a new home while also reducing the building times from several months to a few weeks. They can also help improve the ways in which people interact with their homes, enhancing the living experience as well as reducing running costs. Thorough insulation, draught proofing and passive heating and cooling via careful solar design can help maximise comfort and minimise ongoing energy requirements, cutting bills for owner/occupiers as well as moving closer to the ultimate goal of net zero. Smart home technology will provide householders with a much greater level of transparency around energy use as well as new ways of managing it via apps and “intelligent” appliances.
But new buildings are only part of the problem, as the rows of Victorian houses that line so many of the UK’s streets acclaim. Eighty per cent of the buildings that will exist in 2050 have already been built, and so retrofitting new green tech such as LED lighting and solar panels, replacing natural gas powered boilers with hydrogen fuelled ones and installing energy-saving smart glazing to old homes will also be big business in a net zero economy.
In the commercial sector, refitting existing buildings rather than constructing new ones will have a role to play. The latest Deloitte London Crane Survey identifies two thirds of new starts as being refurbs rather than new builds.
What will buildings – and building sites – be like in a net zero world? New building regulations will mean the sight of a carbon-intensive steel beam or concrete lintel becomes a rarity. Instead, timber – which actually locks atmospheric carbon within it while it grows – will become the major construction material for buildings under 20 storeys high. Construction will be quicker and of more consistent quality thanks to increasing use of factory built low-carbon components.
The houses themselves will be great to live in – warm, draught free
and full of natural light thanks to designs that maximise daylight illumination and insulation. They will be packed with intelligent technology to optimise temperature and air quality, while minimising energy use. They will be cheap to heat, and may even generate a small passive income from renewable energy generation for part of the year.
The net zero home is a great example of how decarbonising does not have to equate to a downgraded lifestyle. In fact it can be a win-win, leading not only to better climate outcomes but also to higher quality products, new business opportunities and better standards of living for all.
NET ZERO HOMES
of the UK’s total carbon footprint is from the buildings we live and work in
40%
Caption to go here please caption to go here please
Street food: vertical farming plants can grow fresh produce with minimal environmental impact in urban spaces
Click a category to discover more
We tend to equate carbon emissions with things that move under their own power, such as cars, trains and aircraft. But some of the biggest prospective wins for net zero are actually to be found among those least mobile of objects: the buildings we live and work in.
The built environment is responsible for almost 40 per cent of the UK’s total carbon footprint, according to the Green Building Council. And with government targets to build an additional 300,000 homes by the mid 2020s, the race to decarbonise the sector is on.
Why are our buildings – and our homes in particular – so carbon intensive? Partly because of the materials traditionally used to build them: bricks, concrete, steel and cement all require large amounts of energy to produce. And partly because older homes in particular are nothing like as energy efficient to heat, cool or power as they could be.
Modern methods of construction using factory-built panels made of low-carbon materials can slash the embodied carbon in a new home while also reducing the building times from several months to a few weeks. Thorough insulation, draught proofing and passive heating and cooling via careful solar design can help minimise ongoing energy requirements, cutting bills for owner/occupiers as well as moving closer to the ultimate goal of net zero.
The final step is adding carbon-positive elements in order to compensate for those emissions that cannot currently be eliminated. A good example is green roofing, which uses soil and plants as “living insulation” to actively remove carbon from the atmosphere. Or solar panels and domestic wind turbines to generate renewable energy. It’s even possible to build homes that are net positive, eliminating more carbon than they emit, especially when the sun is shining or the wind blowing.
Global supply chains with high carbon emissions built into old-fashioned transportation and production methods will increasingly be replaced by locally sourced goods that minimise food miles, produced using innovative low carbon techniques. Vertical farming – using soilless hydroponics technology to grow fresh produce with minimal environmental impact in redundant urban spaces such as vacant office buildings and even disused underground stations – will enable more food to be grown in cities, near where it is consumed. Online grocer Ocado has already invested millions in this fast-growing sector, which is predicted to be worth £15 billion in sales annually by 2026.
However, in a fiercely competitive sector, net zero also creates opportunities for brand-new players. Take the Clean Kilo, the UK’s largest zero-waste store, which set up shop in
June 2018 and now has two branches in Birmingham’s Digbeth and Bourneville districts. The Clean Kilo addresses the issues of
carbon emissions from plastic, paper and
metal packaging by selling only loose and unpackaged goods. It’s “back to basics”
eco-shopping where customers bring their
own reusable containers to be filled and weighed in store.
So what might the net zero supermarket of tomorrow look like? It will probably be smaller and offer less parking as customers order online for low-carbon delivery via EVs or robots. Packaging will be dramatically reduced, and what there is will be made of sustainable, reusable materials. Food waste will be eliminated and goods will carry a carbon “kitemark” to guarantee their green credentials. Meat will be far less prevalent on the shelves as plant-based or lab-grown alternatives replace it in our diets.
Over the past 30 years, the UK’s supermarkets have been hugely successful in reducing the cost of the food we eat, without sacrificing quality. Their big opportunity for the next 30 years is to do the same for carbon emissions, so that food – and the supermarkets’ business models – can achieve net zero.
HOW TO TRANSFORM YOUR BUSINESS
NET ZERO ACTION
Transfrom your business
NET ZERO ACTION
NET ZERO ECONOMICS
WHY IT PAYS TO
ACT NOW
NET ZERO ECONOMICS
Why it pays to
act now
With cement production accounting for 8 per cent of the world’s carbon emissions, we need more planet-friendly ways to build. Future homes may feature frames of timber or reclaimed steel and be insulated with sheep’s wool, cork, hemp or straw. More than a fifth of newbuild houses in the UK are already timber framed, with the proportion in Scotland reaching 76 per cent.
1. Construction and
insulation materials
Balancing energy consumption and production demands design that prevents energy from being lost. “Passivhaus” is the gold standard in this regard, using sunshine, shade and ventilation to maintain a pleasant year-round temperature while consuming less energy than a traditional home. More than 65,000 homes have been built to this standard globally.
2. Airtight building
and energy recovery
ventilation system
Many of us may soon have an air source heat pump warming our home instead of a boiler. This absorbs heat from outside (even from air as cold as minus 15C) to warm internal rooms and produce hot water, a little like a fridge operating in reverse. Solar panels, meanwhile, can provide electricity needed to run the pump and support electric vehicle charging too – with any excess fed back
to the grid.
3. Energy production
Replacing traditional bulbs with LEDs can save as much as 65kg of CO2 a year – equal to driving a car 220 miles. And, as 20 per cent of the average UK electricity bill goes on lighting, UK homeowners save an average of £240 per year by swapping incandescent lights for LED alternatives. Replacing old appliances with energy-efficient models can be healthy for our wallets too; switching from a C- to an AA-rated fridge-freezer could save £113 per year, for example.
4. Energy efficient
lighting and appliances
Over half of the public water supply is used in homes, with the average person getting through 150 litres a day. Installing low-flow taps and showers that aerate water is an easy way to cut hot water use, and therefore the energy used to heat it. A five-minute shower from a water-efficient single spray showerhead will use 40–50 litres, half of what’s needed for a bath.
5. Energy efficient
water use
In future, a smart home energy app is likely to monitor how much energy we’re using and make real-time suggestions for reducing it. It could inform us when our electric vehicle battery is full, point out when the house has reached optimal temperature and offer to turn down the heating, remind us when our air source heat pump is due for a service, and sell surplus energy back to the grid at a profit.
6. Smart meters
WHAT A NET ZERO
HOME LOOKS LIKE
Click the arrows to see inside
But new buildings are only part of the problem, as the rows of Victorian houses that line so many of the UK’s streets acclaim. Eighty per cent of the buildings that will exist in 2050 have already been built, and so retrofitting new green tech such as LED lighting and solar panels, replacing natural gas powered boilers with hydrogen fuelled ones and installing energy-saving smart glazing to old homes will also be big business in a net zero economy.
In the commercial sector, refitting existing buildings rather than constructing new ones will have a role to play. The latest Deloitte London Crane Survey identifies two thirds of new starts as being refurbs rather than new builds.
What will buildings – and building sites – be like in a net zero world? New building regulations will mean the sight of a carbon-intensive steel beam or concrete lintel becomes a rarity. Instead, timber – which actually locks atmospheric carbon within it while it grows – will become the major construction material for buildings under 20 storeys high. Construction will be quicker and of more consistent quality thanks to increasing use of factory built low-carbon components.
The houses themselves will be great to live in – warm, draught free and full of natural light thanks to designs that maximise daylight illumination and insulation. They will be packed with intelligent technology to optimise temperature and air quality, while minimising energy use. They will be cheap to heat, and may even generate a small passive income from renewable energy generation for part of the year.
The net zero home is a great example of how decarbonising does not have to equate to a downgraded lifestyle. In fact it can be a win-win, leading not only to better climate outcomes
but also to higher quality products, new business opportunities and better standards of living
for all.
With cement production accounting for 8 per cent of the world’s carbon emissions, we need more planet-friendly ways to build. Future homes may feature frames of timber or reclaimed steel and be insulated with sheep’s wool, cork, hemp or straw. More than a fifth of newbuild houses in the UK are already timber framed, with the proportion in Scotland reaching 76 per cent.
1. Construction and insulation materials
Balancing energy consumption and production demands design that prevents energy from being lost. “Passivhaus” is the gold standard in this regard, using sunshine, shade and ventilation to maintain a pleasant year-round temperature while consuming less energy than a traditional home. More than 65,000 homes have been built to this standard globally.
2. Airtight building and
energy recovery ventilation system
Many of us may soon have an air source heat pump warming our home instead of a boiler. This absorbs heat from outside (even from air as cold as minus 15C) to warm internal rooms and produce hot water, a little like a fridge operating in reverse. Solar panels, meanwhile, can provide electricity needed to run the pump and support electric vehicle charging too – with any excess fed back to the grid.
3. Energy production
Replacing traditional bulbs with LEDs can save as much as 65kg of CO2 a year – equal to driving a car 220 miles. And, as 20 per cent of the average UK electricity bill goes on lighting, UK homeowners save an average of £240 per year by swapping incandescent lights for LED alternatives. Replacing old appliances with energy-efficient models can be healthy for our wallets too; switching from a C- to an AA-rated fridge-freezer could save £113 per year, for example.
4. Energy efficient lighting
and appliances
Over half of the public water supply is used in homes, with the average person getting through 150 litres a day. Installing low-flow taps and showers that aerate water is an easy way to cut hot water use, and therefore the energy used to heat it. A five-minute shower from a water-efficient single spray showerhead will use 40–50 litres, half of what’s needed for a bath.
5. Energy efficient water use
WHAT A NET ZERO HOME LOOKS LIKE
Illustration by Vanessa Branchi/MP arts for Bridge Studio
NET ZERO Supermarkets
NET ZERO HOMES
Net zero manufacturing
net zero consumer
Manufacturing produced 60 metric tons of carbon dioxide equivalent in 2018. Switching to combined heat and power can cut carbon emissions by up to 30 per cent compared with powering onsite furnaces or boilers directly from an electricity power station. Solar power, of course, is a zero-emissions option.
1. Renewable energy
Switching to LED lights and maximising daylight in factories can offer big energy savings. Carmaker Ford anticipates its switch to 25,000 LEDs will cut energy use in its plants by 56 million kilowatt hours annually. Increasing natural light with skylights reduces the need for electric lighting and can boost workers’ productivity by as much 15 per cent.
2. Improved energy efficiency
There are many ways to cut the emissions created by moving goods. Ammonia-fuelled shipping is gaining favour as a zero-carbon option; hydrogen-powered trains are being trialled in Germany and the UK; and hydrogen-powered drones may soon be delivering our parcels. A project is currently underway to use both ammonia and hydrogen to fuel unmanned vehicles delivering goods by air and sea between Bristol and Cardiff.
3. Lower transport
emissions
Millennials and Gen-Xers are driving closed-loop manufacturing, where companies re-use materials over
and over to make their products.
Several major coffee brands have united to provide a single scheme, which launched in April 2021, whereby users can return their
pods for recycling. The aluminium will be recycled and coffee
grounds composted.
4. Less waste
Going net zero requires manufacturers to remove sources of carbon emission from supply chains. So the commodities they source must not contribute to deforestation, which releases CO2 and cuts forests’ capacity to absorb carbon. The UK is considering legislation that would fine larger companies for using products such as palm oil, soy and beef that have not been produced according to local laws.
5. Greener raw materials
WHAT NET ZERO
MANUFACTURING
LOOKS LIKE
WHAT A NET ZERO
SUPERMARKET LOOKS LIKE
SEE OUTSIDE
SEE INSIDE
SEE OUTSIDE
SEE INSIDE
Using LED lights, fitting doors on refrigerators and choosing climate-neutral refrigerants will make heating, lighting and chilling goods more energy efficient. Supermarket fridges alone account for around 1 per cent of the UK’s electricity use – enough to power 800,000 homes.
Excessive waste will be a thing of the past as consumers fill their own containers from dispensers, instore bins encourage customers to recycle residual packaging and algorithms enhance forecasting accuracy for perishable goods.
Supermarkets will help to drive changes in consumer behaviour by providing electric-vehicle charging points in car parks, and offering tips on buying locally, healthy eating and reducing carbon footprints. According to the 2020 Deloitte Sustainable Consumer report, 28%
of all consumers and 45% of Gen Z have stopped buying certain products due to ethical or environmental concerns
Biogas produced by micro-organisms breaking down waste food is one onsite option; others involve wind and solar power. Tesco is installing solar panels on 187 supermarkets in the UK, as well as developing five onshore wind farms and a solar farm for generating energy off site.
Last-mile deliveries will likely be made in high-performance electric vehicles, with e-cargo bikes fulfilling home deliveries. Transporting food within, to and around the UK currently produces 19 million
tonnes of CO2 annually.
Bringing production closer to customers is one way to reduce carbon emissions. Ocado is investing in indoor vertical farming, while the experimental urban Park Supermarket being developed in the Netherlands aims to grow and sell in one place much of the produce you’d find in a supermarket.
1. Less energy use
2. No waste
3. Changing consumer behaviour
1. More renewable energy
2. Improved fuel efficiency
3. Lower food miles
WHAT NET ZERO MANUFACTURING LOOKS LIKE
With cement production accounting for 8 per cent of the world’s carbon emissions, we need more planet-friendly ways to build. Future homes may feature frames of timber or reclaimed steel and be
insulated with sheep’s wool, cork, hemp or straw.
More than a fifth of newbuild houses in the UK are already timber framed, with the proportion in
Scotland reaching 76 per cent.
1. Construction and insulation materials
Manufacturing produced 60 MtCO2e in 2018. Switching to Combined Heat and Power can cut carbon emissions by up to 30% compared with when heat and electricity are generated separately by a gas-fired boiler and electricity power station. And solar provides a zero-emissions option. Britishvolt is building a new vehicle battery manufacturing plant in Northumberland which will be powered by a 200 megawatt solar farm.
1. Renewable energy produced onsite
Switching to LED lights and maximising daylight in factories can produce large energy savings. Ford anticipates its switch from traditional lights to 25,000 LEDs will cut energy use in its plants around the world by 56 million kilowatt hours annually. Increasing natural light, such as through rooflights, reduces the need for artificial lighting and can boost workers’ productivity by as much 15%.
2. Improved energy efficiency
There are many ways to optimise logistics to cut emissions. Ammonia-fuelled shipping is gaining
favour as a zero-carbon way to deliver goods by sea; hydrogen-powered trains are being trialled in Germany and the UK; hydrogen-powered drones may soon
be delivering our parcels. A project is currently underway to use ammonia and hydrogen to fuel deliveries of goods by sea and air in unmanned vehicles between Bristol and Cardiff.
3. Lower transport emissions
Millennials and Gen X are driving a trend for closed-loop manufacturing. This is where manufacturers
re-use the same materials over and over again to make new products. As of April 2021, users of Nespresso, NESCAFÉ Dolce Gusto, Tassimo, L’OR and Starbucks at Home coffee will be able to return their pods for recycling through a single scheme set up by Nestlé and Jacobs Douwe Egberts UK. The aluminium will be recycled, and coffee grounds composted.
4. Less waste
Illustration by Vanessa Branchi/MP arts for Bridge Studio
Click the arrows to see inside
SEE OUTSIDE
SEE INSIDE
WHAT A NET ZERO SUPERMARKET
LOOKS LIKE
Click the arrows to see outside
Biogas produced by micro-organisms breaking down waste food is one onsite option; others involve wind and solar power. Tesco is installing solar panels on 187 supermarkets in the UK, as well as developing five onshore wind farms and a solar farm for generating energy off site.
1. More renewable energy
Last-mile deliveries will likely be made in high-performance electric vehicles, with e-cargo bikes fulfilling home deliveries. Transporting food within, to and around the UK currently produces 19 million tonnes of CO2 annually.
2. Improved fuel efficiency
Bringing production closer to customers is one way to reduce carbon emissions. Ocado is investing in indoor vertical farming, while the experimental urban Park Supermarket being developed in the Netherlands aims to grow and sell in one place much of the produce you’d find in a supermarket
3. Lower food miles
SEE OUTSIDE
SEE INSIDE
WHAT A NET ZERO SUPERMARKET
LOOKS LIKE
Click the arrows to see inside
Using LED lights, fitting doors on refrigerators and choosing climate-neutral refrigerants will make heating, lighting and chilling goods more energy efficient. Supermarket fridges alone account for around 1 per cent of the UK’s electricity use –
enough to power 800,000 homes
1. Less energy use
Excessive waste will be a thing of the past as consumers fill their own containers from dispensers, instore bins encourage customers to recycle residual packaging and algorithms enhance forecasting accuracy for perishable goods.
2. No waste
Supermarkets will help to drive changes in consumer behaviour by providing electric-vehicle charging points in car parks, and offering tips on buying locally, healthy eating and reducing carbon footprints. The State of Grocery Retail 2021 report found 19 per cent of UK consumers surveyed intend to spend more on environmentally friendly products in 2021.
3. Changing consumer behaviour
Global supply chains with high carbon emissions built into old-fashioned transportation and production methods will increasingly be replaced by locally sourced goods that minimise food miles, produced using innovative low carbon techniques. Vertical farming – using soilless hydroponics technology to grow fresh produce with minimal environmental impact in redundant urban spaces such as vacant office buildings and even disused underground stations – will enable more food to be grown in cities, near where it is consumed. Online grocer Ocado has already invested millions in this fast-growing sector, which is predicted to be worth £15 billion in sales annually by 2026.
However, in a fiercely competitive sector, net zero also creates opportunities for brand-new players. Take the Clean Kilo, the UK’s largest zero-waste store, which set up shop in
June 2018 and now has two branches in Birmingham’s Digbeth and Bourneville districts. The Clean Kilo addresses the issues of
carbon emissions from plastic, paper and
metal packaging by selling only loose and unpackaged goods. It’s “back to basics”
eco-shopping where customers bring their
own reusable containers to be filled and weighed in store.
So what might the net zero supermarket of tomorrow look like? It will probably be smaller and offer less parking as customers order online for low-carbon delivery via EVs or robots. Packaging will be dramatically reduced, and what there is will be made of sustainable, reusable materials. Food waste will be eliminated and goods will carry a carbon “kitemark” to guarantee their green credentials. Meat will be far less prevalent on the shelves as plant-based or lab-grown alternatives replace it in our diets.
Over the past 30 years, the UK’s supermarkets have been hugely successful in reducing the cost of the food we eat, without sacrificing quality. Their big opportunity for the next 30 years is to do the same for carbon emissions, so that food – and the supermarkets’ business models – can achieve net zero.
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Building a greener future: modern construction methods using low-carbon materials will make homes more eco-friendly
Read more stories to inspire
your journey to net zero here
Green groceries: the Clean Kilo only sells unpackaged and loose goods to save on waste
Street food: vertical farming plants can grow fresh produce with minimal environmental impact in urban spaces
Purer production: nearly half of UK manufacturers are investigating net zero as a business opportunity
Generation staycation: future consumers will travel less and take fewer holidays abroad