Energy Transition
We're costing our energy system wrongly. Here's how to get it right
A decarbonized energy system will demand a shift in how we determine the cost of energy. Here're 3 recommendations for policy-makers to help to drive change
System Value
To keep global temperature increases below 1.5 degrees, the economy and supporting energy system need to change, and how we value the energy system is at the heart of that change.
Introducing System Value
Traditionally, cost has been a key driver for decision making when investing in low carbon technologies, business models or initiatives. But to accelerate actions and investments for a net zero carbon future, a new lens is needed – one which highlights a range of benefits and broader value. System Value is this new lens for decision making.
System Value is a holistic framework that evaluates economic, environmental, social, and technical outcomes of potential energy solutions. The framework aims to shift political and commercial focus beyond cost to include value. Policies, investments, and solutions can be evaluated to assess their impact on a range of outcomes.
System Value can be used for dialogues to align public and private stakeholders, investment decisions, investor conversations, rates cases, policy creation or advocacy.
System Value and Net Zero
The World Economic Forum is applying the System Value framework to drive dialogues and programs which aim to accelerate the clean energy transition. The framework helps focus on those solutions and actions which not only reduce emissions, but also help deliver economic benefits such as job creation and health benefits from better air quality. For example:
- The Energy Transition Index considers system value as a key framework to build a resilient transition, discussing how it can be applied in local contexts during country roundtables
- The Net Zero Carbon Cities program uses the framework to help city stakeholders create alignment on goals and outcomes between government leaders and a range of business investors in order to prioritize decarbonization interventions. The framework is a useful starting point to help identify both short term priorities, as well as the creation of long-term roadmaps.
- The Industrial clusters initiative uses the framework to pursue solutions that maximize system value beyond GHG emissions reduction - pursuing collaborative actions that improve outcomes across the economy, the environment, society, and the energy system.
In addition, the Framework is being used as a guide to creation net zero maps for various countries, both with the Forum’s input and beyond.
The path to maximise System Value
Path to maximise System Value
Image: World Economic Forum and Accenture
With special thanks to Henrik Andersen, CEO of Vestas and Chair of the World Economic Forum's Electricity Industry community for leading this work in collaboration with CEOs from electricity companies around the world.
Additional thanks to the team at Accenture for supporting the work.
Overview
Market analysis by the World Economic Forum
Market analysis by partner organisations
Further reading
Energy Transition
The global energy transition starts with local solutions. Here's why
We can make global progress towards the energy transition by supporting local communities with holistic energy solutions and detailed analytics. Here's why
Forum Institutional
Investing in sustainable energy can enable resilient societies in race to net-zero
We need public-private collaboration and investment in sustainable energy systems to achieve net-zero and help build resilient societies post-pandemic.
Climate Action
How a system value approach can help Ireland meet its climate targets
We examine how Ireland can apply the World Economic Forum's 'System Value Framework' to halve its emissions by 2030 and enable a clean energy transition.
Energy Transition
Why buildings are the foundation of an energy-efficient future
Ensuring new buildings are sustainable will be key to tackling climate change – and it will also benefit employees, bottom lines and investors. Here's how.
Stakeholder Capitalism
Ukraine must work with leading nations to build sustainable energy markets
COVID-19 may have exposed cracks in business models but it has renewed efforts to build a sustainable economy – Ukraine can be part of that crucial change.
Geographies in Depth
How China set the path for net carbon neutrality by 2060
More than 400 government and business leaders gathered in Beijing to discuss opportunities to transition to a low-carbon economy. Here are some takeaways.
Climate Action
Industrial clusters are critical to getting to net-zero. Here’s why
Technologies such as carbon capture and storage and hydrogen can help industrial clusters - among the world's biggest emitters - towards a net-zero future.
Energy Transition
System value can power the energy transition in emerging markets
Governments and businesses have to balance the energy transition with new jobs and growth. How can they best achieve this, particularly in emerging markets?
Energy Transition
System Value can usher in a future of great promise
There are good reasons to be optimistic about our chances of sufficiently curbing our emissions – and our new System Value framework can help. Here's how
Energy Transition
How sustainable investments can help accelerate the energy transition
With a system value approach, accelerating the energy transition through sustainable investments is an obvious choice - especially in these uncertain times
Energy Transition
The new lens that can unlock the net zero economy
A net zero economy must be based on a system value approach. Through this lens, sustainable development can be linked with decarbonization – here's how.
Energy Transition
Electric vehicles alone can't achieve the energy transition. But as part of a system, they will
An investment of €6 billion in the charging infrastructure of electric vehicles could yield over €12 billion in human health benefits from improved air quality
Energy Transition
How can we maximise the benefits of a system value approach?
Analysis of 6 major markets reveals a common path that maximises the benefits of system value as countries pursue their zero-carbon goals. Here's a guide.
Energy Transition
Our new system value framework can power the energy transition
Our newly developed system value framework has been designed to help decision-makers ensure the energy transition is efficient, effective and sustainable.
Energy Transition
A System Value approach can accelerate the energy transition. Here's how
System Value is a way to measure the impact of clean energy policies in a holistic way - enabling decision-makers to hasten the dawn of a sustainable future.