Water utilities across Australia are working towards ambitious Net Zero targets, with many already making significant progress in reducing emissions.
But the pathway to Net Zero is changing.
The strategies utilities have developed today are based on assumptions about carbon accounting, emissions boundaries, regulation, technology and offset markets that may look very different in the years ahead. As measurement techniques improve, reported Scope 1 emissions could increase, while Scope 3 emissions may become a more significant consideration in future reporting and reduction obligations.
At the same time, utilities that rely heavily on external offsets may face increasing exposure to changing emissions baselines, market availability and price volatility. Changes to the way renewable electricity is accounted for could add another layer of complexity.
Moving from a static plan to a ‘no-regret’ pathway
Rather than designing a Net Zero strategy around one assumed future, Sequana advocates for a ‘no-regret’ pathway: an adaptive approach that prioritises actions that create value across multiple plausible futures.
That means looking for opportunities that reduce emissions while also improving operational efficiency, lowering whole-of-life costs, increasing resilience and reducing exposure to future regulatory and market changes.
Opportunities such as on-site renewable energy and storage, load shifting, fleet and asset electrification, and more productive use of biosolids can all form part of this pathway. The focus should not be on adopting technology for its own sake, but on assessing investments against different future carbon, energy and regulatory scenarios and prioritising those that deliver enduring value.
The objective is not to create the perfect Net Zero plan for today. It is to create a pathway capable of adapting as technology, regulation and markets evolve.
Utilities that understand their exposure, test decisions against future scenarios and prioritise actions that create value beyond carbon reduction will be better prepared as the pathway to Net Zero continues to move.
Want to explore the thinking in more detail?
Download the full paper: The moving target: Why water utilities need to rethink the pathway to Net Zero
The full paper explores the changing emissions landscape, risks associated with carbon offsets, emerging technologies and funding opportunities, and how Sequana can help utilities understand their exposure, build a no-regret pathway and turn strategy into delivery.
