"Climate change is a strategic issue for the insurance sector. Left unchecked, it will continue to affect the actuarial assumptions underpinning the insurance products we provide, and render significant proportions of the economy uninsurable – shrinking our addressable market. Over the coming decades, climate change presents solvency issues to businesses in many different industries, including our own."
Why do you think RE100 is a good initiative to join?
"RE100 is a great initiative and fits well with our focus on supporting the drive to low-carbon communities and society. We are delighted to be involved and look forward to working with others to build the business case for increasing renewable energy capacity and availability in markets where it currently does not exist."
What internal process did you go through to decide on your 100% goal?
"We have had an overall long term carbon reduction target in place since 2010 – 20% reduction by 2020. We far exceeded this by the end of last year; reducing emissions by 32%. We have now set more stretching targets of 40% by 2020, and 50% by 2040. To help us meet these targets we wanted to have a specific renewable electricity goal in place. Committing to 100% renewable electricity will ensure we redouble our efforts."
What have you achieved on your journey so far?
"We have been purchasing 100% renewable electricity in the UK since 2004, and building our proportion of electricity from renewable sources in other markets when it is available and appropriate to do so. At the end of 2014 we had reached 56% renewables (up from 48% in 2013). This year we installed solar PV arrays on two of our UK locations, and have another installation scheduled for 2016.
"As an institutional investor focusing on maximising long-term returns for our clients, we have invested approximately £400 million in renewable infrastructure including residential solar PV systems covering 24,000 properties with a generating capacity of 75MW. We have recently committed a further £2.5 billion over the next 5 years in low-carbon infrastructure, with a targeted carbon saving of 100,000 tonnes per annum.
"As an insurer we also provide insurance products for low-carbon and renewable energy installations such as wind turbines, solar arrays, micro-hydro turbines and anaerobic digestions systems."
What opportunities and challenges have you encountered as you have been working to 100%?
"We have joint venture arrangements in India and China that currently equate to 55% of our global total electricity-related carbon emissions, despite only making up 12% of our global electricity consumption. Availability of renewable electricity in these regions has been our greatest challenge as there are currently no renewable electricity tariffs available in either country – though the authorities are taking great strides to increase generation capabilities. We will seek to work with other companies that have signed up to RE100 to build demand for commercial renewable electricity tariffs."
What plans are there for increasing your use of renewable electricity?
"We will be working with each of our 17 markets to maintain and increase the use of renewables through procurement, installation of on-site generation, or having on-site generation as one of the criteria when we lease new buildings for our operations."
Why do you think it is important for companies to play a role in accelerating demand for renewable electricity?
"Companies can use their procurement power for good. Through contracts with suppliers the use of renewable electricity could be a service level criterion, or specified in a management services agreement for investment properties. With the increasing energy demand for transportation and buildings, and affordable low-carbon energy availability being a catalyst in helping reach global Sustainable Development Goals, the way electricity is generated needs to be part of the solution going forward. Renewable electricity is vital in providing a secure, low-cost, long-term solution for society and the planet."
What else are you doing to help the transition to a low-carbon economy?
"At Aviva, we have sought to mitigate our operational impact over the last decade. In addition to purchasing electricity from renewable sources this has been done through the use of energy efficient technology and behavior change, and by offsetting the remaining CO2 emissions through purchasing carbon credits. Aviva was the first carbon-neutral insurance company in regard to its worldwide operations. Our approach to carbon offsetting has directly improved the lives of over 800,000 people."