In addition to the sun, energy sources like wind and water are abundant and clean. Any one of them would be a better source of energy than fossil fuels — at least as far as the climate and the environment are concerned. But with nearly the entire global economy running on sources like gas, coal and oil, how can we steer away from traditional fuels and toward renewable energy? And can we do it quickly enough to meet the energy needs of a rapidly growing population?

Swiss Re is not only shining a light on these questions — it leads by example toward a sustainable energy future.

Envisioning the future

The International Energy Agency estimates that between now and 2035, world energy demand will increase by 40%. Ninety per cent of the ‘new’ demand is expected to come from emerging markets, notably China and India. Meeting these needs will require global investment of around USD 38 trillion. The question then becomes how to channel that investment in a way that promotes a more sustainable energy system.

The Scenarios for Climate Change (SCC)project, a research initiative supported by Swiss Re, has laid out six different scenarios. Under all of them, the global energy system will shift towards a greener power mix, with higher demand for low-carbon technologies. These include renewable energy sources like solar energy as well as adaptations to traditional sources, such as modifying coal-burning power plants so that the carbon they emit is safely captured and stored. In the most likely scenario, characterised by a “slow greening” of the world economy, low-carbon technologies would deliver about 40% of the global energy supply by 2050. The share attributable to solar and wind power would rise from today’s paltry 2% to 17%. And if the world actually took concerted action on climate change? The SCC foresees that the share of renewable energy could then rise to around 92% — and nearly half of that from wind and solar, with much of the growth happening in Asia.

Getting to the 92% scenario will require enormous start-up investments, and success will depend by definition on less mature technologies. It will also require favourable conditions across a variety of systems over time, ranging from weather to government regulation. In other words, there is a unique risk management dimension to building a sustainable energy future, and here Swiss Re’s expertise can play a central role.

The future takes flight

Renewable energy pioneers — like pioneers in countless industries before them — will need the help of the re/insurance industry to manage the inherent risk of developing solar, wind and hydro power. The new partnership between Corporate Solutions and Solar Impulse, the world’s first solar-powered airplane able to fly day and night, is one amazing example.

Swiss aviators Bertrand Piccard and André Borschberg built Solar Impulse with the goal of flying around the world using only solar energy. Through Corporate Solutions we are proud to be their official insurance provider. The partnership is a sign of our support for innovation and an encouragement to everyone engaged in the search for clean, safe and forward-looking sources of energy. In 2012 Solar Impulse travelled more than 6,000 kilometres on solar power alone and achieved the world’s first solar-powered intercontinental flight, showing what we can already achieve without fossil fuels — and that a clean energy future is not as distant as it may seem.

Leading by example

Solar Impulse is one inspiring example. Getting from our current situation to a sustainable energy future will require countless more. In our policies and in our business, we are trying to move both the supply and demand sides of the equation in the right direction. Twenty-one Swiss Re locations in Asia, Europe, North America and Oceania now use renewable power, fully or partially. Our goal is to use 100% renewable power by the end of 2013. In our Zurich headquarters we only buy “naturmade star” electricity (www.naturmade.ch), which meets tough ecological quality criteria. In Munich we purchase our electricity from NaturEnergie (www.naturenergie.de), one of Germany’s premier suppliers of renewable energy.

Of course the most direct impact we have on the world’s energy system is through our business. We look critically at potential energy projects that may have an adverse effect on our energy future through our Sustainability Risk Framework. Our Sustainability Risk team monitors developments that may have similar implications, such as fracking and tar sands, and develops appropriate policies. By watching vigilantly over our own portfolio, and staying on top of market and technological developments, we hope to remain a steady, deliberate and proactive force in creating a sustainable energy future, and so build long-term value for our shareholders and society at large.