Davos: The Need for Renewables in Our Shared Future

This blog was originally posted on Virgin.com.

You might believe, as many people do, that the World Economic Forum in Davos is out of touch with everyday people. To me, the only thing worse than the global elite getting together to solve the world’s problems is the global elite getting together and not solving the world’s problems.

The theme this year was creating a shared future in a fractured world, which is exactly what our global leaders should be talking about. And this year the forum gathered together the most powerful aggregation of global corporate and government leaders in recent decades.

Climate change at the forefront

I participated in the forum and led a dialogue about the role of renewable energy in creating a shared future—a key theme at the forum, touted by many heads of state. In the opening plenary, Indian Prime Minister Narendra Modi named climate change the number one challenge to civilization as we know it, and shared his country’s ambitious goal of producing 175 gigawatts of renewable energy by 2022. French President Emmanuel Macron said he wants to “make France a model in the fight against climate change,” and will shut down all the country’s coal-fired power plants by 2021.

The missing voice

The numerous energy tracks at the forum were largely made up of policy makers, utilities, and technology providers. The discussion around renewable energy is often thought of as a three-legged stool: technology, finance, and policy. While those three things are indeed crucial to advancing renewable energy, there is also a critical fourth element that is much harder to shift—people. Unfortunately, like many large conferences, the voice of energy consumers was largely lacking at Davos.

I participated in the Accelerating Innovation for Sustainable Energy panel, which had a rich, dynamic dialogue around accelerating technological innovation. There was consensus around the important role that government can play in both financing technological innovation to start the research and development process, and also shepherding winning technologies all the way through commercialization. However, often where technology fails is not in the early R&D phase but in pre-commercialization—a phase when a technology often requires no changes to policy or finance, but just needs buyers to take a risk and use something they haven’t used before. It’s where human dynamics really come into play.

While policy and finance support systemic change, most dramatic shifts are driven by people and companies making different choices. There’s an inertia we have—our human instinct is to do things the way we always have, or “don’t fix what isn’t broken.” But when you see large companies make dramatically different decisions, when they say “we’re no longer going to simply pay the utility bill; we’re going to sign up for a 10-year contract to buy renewable energy at a fixed price,” that’s when you see huge shifts. Unfortunately, there was very little discussion in Davos around the incredible momentum that’s building on the consumer side of the equation.

Corporations step up

And that momentum is building. RE100 is a global initiative of more than 100 influential businesses, from Adobe to Walmart, committed to 100 percent renewable electricity. These companies are working to massively increase demand for—and delivery of—renewable energy. Forty-eight corporations have signed large off-site renewable energy deals to date, bringing over 10 GW of renewable energy online since 2012. And 14 of the 19 corporations that signed large renewable energy deals in 2017 were new buyers, many from the Fortune 500. In fact, one corporate buyer, Budweiser, did use Davos as a platform for its renewable energy ambitions, announcing that it will brew all of its beers with renewable energy by 2025. A symbol will appear on the label of every beer brewed in the U.S. with renewable energy. The company hopes the 100 percent renewable energy symbol will spread to additional markets as well.

The East-West divide

One theme that surprised me in Davos was around energy access. There are still over 1.4 billion people on the planet without access to modern electricity. And there is a seemingly persistent misunderstanding that renewable energy can’t solve the energy access problem at scale.

Many people don’t realize that here in the U.S., the combined operating and capital cost of renewable energy is now cheaper than just the operating expense of existing coal plants. There still seems to be an East-West divide over the role renewable energy can play in energy access. While much of the West sees renewable energy as a path forward, much of global South is still wondering if renewable energy is the short end of the stick. Hopefully the rapidly industrializing countries will realize that renewable energies are the future.

Still some “manels”

It is hard to talk about Davos without mentioning gender and the large effort made to increase gender diversity on the panels. This was the first time in history that the World Economic Forum was run 100 percent by female cochairs. One panel, which featured all seven women cochairs, caused International Monetary Fund Managing Director Christine Lagarde to call it “not your usual Davos manel.” 

Unfortunately, that was not the norm. Even with the concerted effort, most of the prime time energy sessions consisted of nearly all men. I was the only woman on the panel I participated in (although we had a female moderator), and the audience was made up of only about 20 percent women.

Turning commitment into action

While it was encouraging to see so much focus on climate change and renewable energy in Davos, we must make sure all these commitments are turned into action. It’s time for C-suite folks to step up and make a difference. It’s happening and is a crucial piece in bringing about real change. Nearly two-thirds of Fortune 100 and nearly half of Fortune 500 companies have set ambitious renewable energy targets. Just as the world’s leaders at Davos need to walk their talk, corporations need to start signing renewable energy deals.

In today’s world, where renewable energy can compete economically with fossil fuels, taking a stand for a different kind of future by investing in renewables can also benefit the bottom line.