How can business help power policy change on renewables?

What role do businesses have in driving climate action?

The world is collectively attempting a wholescale transformation of our economic model in little more than a generation. That’s something that has never been achieved before, so it’s clear that no individual actor or even sector is going to be able to pull that off alone. Everything is too interdependent. The choreography of business action and government policy in particular is critical and no one side can wait indefinitely for the other to go first. But, on balance, I believe it’s easier for businesses to go first, indicating the direction of travel for policy and governments to follow.

Governments are competing for business investment and intention. They’re sensitive to what businesses believe will create sustainable value in the long term. When businesses come together and advocate for policy change, or demonstrate their commitments to sustainability or an accelerated transition to renewables, this can catalyse action inside national capitals where policy decisions that directly affect businesses are being made.

Businesses also have the opportunity to innovate, invest in research and development, and pilot projects that are not yet commercially viable but we hope will be in the future. These send strong signals to government that this is a serious direction of travel away from the old order. That helps lead to better and more ambitious policy frameworks and regulations which boost confidence in business investment.

How can businesses drive the demand for renewables in a specific country?

Start by buying it. If you can’t buy it, or buy it in the right quality and quantity, engage with energy suppliers. In some countries, it’s not a supply problem, it’s a regulatory one. Some countries have nationalised utility monopolies with very little flexibility in the market. You have no option but to buy power at the average grid carbon intensity from the national supplier. In places like these, we need to step up policy advocacy to liberalise those energy markets in a way that will provide more innovation and more investment.

There’s self-generation as well. At Unilever we self-generate electricity at 62 of our sites. Where that’s not possible or suitable for that site, we enter into large-scale physical and virtual power purchase agreements. We have just signed one in India for 45 megawatts of renewable solar capacity, not only for our own manufacturing but also for some of our co-manufacturers. That went live in October 2024. But it’s not just about our business’s power needs. The whole grid needs to decarbonise.

We know power demand is going up so not only do we need renewable power, we also need more power in general on the grid, especially when you consider the growing power demand for data centres, the electrification of transport and the growth in green hydrogen production. That’s what’s going to bring big shifts in national utilities and energy providers around the world.

What opportunities are there for countries that make it easier for corporates to use renewable electricity?

Increasingly, companies like Unilever and many other companies that are expanding globally have their own targets. Whether those are science-based targets or they’re members of RE100, they have their own goals. These companies are looking to grow in countries where there’s renewable power readily and easily available. We source renewable electricity in 77 countries that we operate in and 92% of our global electricity use is from renewables. You do hear companies talking about renewable power constraints being a decision factor in where to invest or move into.

So you’ve got the investment potential in the national energy system to consider by making renewables available, or not, to corporates looking to use it.

How can business and policymakers work together to reach the global tripling goal?

Any global goal is a sum of national goals. Some countries will need to do more, others less, to help reach the overall goal. But tripling globally installed capacity, as committed to by more than 100 countries last year, is a big ambition, so everybody needs to play their part.

There needs to be a dialogue between business organisations and governments about what is at the maximum level of plausible ambition within a country and build business and government support around that. As a business, we’re looking to see specific renewable energy targets within national strategies, reflected in the updated Nationally Determined Contributions that are being submitted. That provides high-level visibility of the intent in those countries, which will give a collective picture of whether the global ambition of the world is on track for the tripling goal.

A target is one thing, but you need a plan to deliver it. There needs to be a conversation, country by country, of what would be the barriers to achieving the country’s specific goal and what is the policy reform required to achieve the goal. Once you have that, then a joint plan can be built. Those barriers will differ by country but what’s really important is that there’s a business–government dialogue on how you maximise ambition and ensure a clear delivery pathway so everybody’s clear on what they need to, and can, do.

What action can companies take that will have the biggest impact on the goal of tripling renewables?

Look to make a difference where you have the maximum influence. If you’re a heavy energy user, like a tech company, then work with your energy providers and consider where your investments are going. If you’re a big brand that is known for climate action, your name might count for as much as your purchasing power. If you can advocate on your own, or through coalitions like RE100, then you must take those opportunities to advance a more optimistic future than many people think is possible.

To read more about our updated commitments on climate, nature, plastics and livelihoods, visit our Sustainability Hub.

*A version of this article was first published on the Climate Group’s RE100 initiative website