Energy Impact Report: All Industries Edition, Q1 2025

Efficiency Innovations and Supply Chain Resilience Transform Energy Service Delivery

This cross-sectoral analysis reveals how energy companies face urgent pressure to repurpose existing fossil fuel infrastructure to avoid stranded assets as the world transitions to cleaner energy sources. The research examines how two major US refineries, with a combined capacity of over 400,000 barrels per day, are scheduled to close in 2025, creating significant repurposing opportunities that require sophisticated materiality assessment processes. These processes address both financial materiality, through asset valuation, and impact materiality, through emissions reduction throughout energy value chains.

The report additionally reveals how tariff escalations have disrupted efficiency innovations for 55% of service providers particularly affecting deployments of energy-efficient equipment and monitoring technologies.

Call to Action: Energy service companies should develop regionally balanced supplier networks and implement flexible service models that can adapt to trade policy fluctuations ensuring efficiency commitments remain deliverable despite economic uncertainties.

The report highlights innovative approaches to infrastructure repurposing, with several former coal-fired power stations being converted to battery energy storage systems (BESS), enhancing grid flexibility while utilising existing grid connections and industrial sites. The UK's last coal-fired power station, Ratcliffe-on-Soar, which ceased operations in September 2024, exemplifies this trend with plans for conversion to energy storage, marking a significant milestone in the country's energy transition while demonstrating growing industry recognition of double materiality considerations in infrastructure planning.

This analysis examines how BESS technology has become crucial for addressing the intermittency challenges of renewable energy sources, with the UK requiring a substantial increase in its battery storage capacity to achieve decarbonisation goals. These "energy banks" represent critical infrastructure for smoothing the variability of renewables, ensuring power continuity regardless of weather conditions while creating new value streams from former fossil fuel assets throughout the energy transition landscape.

The report examines how energy infrastructure is facing increasing challenges to climate resilience, with extreme weather events already the primary cause of prolonged electricity outages globally. Recent examples include record-breaking temperatures exceeding 49°C in Canada, which have placed immense strain on power grids. At the same time, wildfires in Australia damaged transmission lines and power stations, highlighting the vulnerability of ageing infrastructure to physical climate risks. Companies implementing comprehensive climate adaptation strategies are demonstrating a heightened awareness of ESG considerations while also addressing both operational continuity and community resilience objectives.

Looking toward future energy landscapes, the report identifies how integrated solutions combining decarbonisation, digitalisation and decentralisation are transforming industry approaches to sustainability and climate resilience. Companies implementing comprehensive strategies aligned with the SDGs for climate action and clean energy are demonstrating enhanced preparedness for evolving regulatory frameworks, including the CSRD, which intensifies disclosure requirements around climate transition planning, physical risk management and strategic asset repurposing throughout rapidly changing energy systems.