David Williams, vice president, transactional businesses, Schneider Electric UK and Ireland, explains how businesses can meet sustainability ambitions during the energy crisis
TODAY’S business leaders are juggling a multitude of challenges, with the energy crisis among the most pressing. Rising energy costs has caused net zero initiatives to fall further down boardroom and operational priorities. As a result, recent research commissioned by sustainability partner Schneider Electric has found that 82% of UK and Irish business leaders feel the energy crisis will impact their organisation’s ability to meet decarbonisation targets.
Yet if the world is to meet commitments to limit temperature rises to 1.5°C by mid-century, we need to halve carbon emissions by 2030 – and business plays a vital part in achieving this target. With just seven years on the clock, it’s critical that businesses get back on track with net zero activities now. Here are some practical and cost-effective ways to accomplish this.
1) Start with a strategy
Net zero is a whole company initiative and this will be reflected in your strategy. Aligning it with your overall business plan will reap top and bottom-line benefits from your net zero projects. Decarbonisation won’t live in a silo, with just a single team accountable for its success. Instead, it will be seen as everyone’s responsibility and, better still, its rewards will be felt by every department.
Reducing carbon emissions is a by-product of having well-run operations across the organisation, so focusing on energy management as a whole can help your business achieve net zero while reducing energy use, lowering energy costs and building resilience across the business.
2) Broaden your mix of solutions
It might feel counterintuitive to invest in a broader range of projects and solutions if your organisation is feeling the pinch, but having a mix of net zero initiatives underway will compound the benefits while ensuring return on investment both over the short and long term.
3) Challenge your perceptions
There are some common misconceptions associated with reducing emissions. The first is simply tackling direct emission, rather than considering the entire lifecycle of power generation for your organisation. If you don’t consider this, you risk missing a vital opportunity to improve cost-effectiveness and efficiency in the future.
Many leaders assume that having a Power Purchase Agreement (PPA) in place means that energy costs are under control. But given the limited duration of these agreements, rising energy costs for finite fossil fuels will eventually impact your business, whether you have a PPA in place or not. Ultimately, switching to more sustainable energy sources will pay off in the long run as fossil fuel supplies dwindle.
Many stakeholders believe achieving net zero is expensive – but it doesn’t have to be. With clever planning and forecasting, you can build a net zero strategy suited to your operations, budget and timeframes. The technology is already available to help you accomplish your net zero ambitions – and the payoff on these is often measured in months rather than years.
4) Communication is key
Decarbonisation can offer many benefits, from energy and cost savings, to greater resilience against energy market volatility, a boosted brand reputation, and better competitiveness in a sustainability-focused market. Communicating these benefits to your stakeholders and employees, while demonstrating a clear return on investment, will help you obtain the buy-in leaders and colleagues you need to implement net zero plans.
That said, it’s worth setting expectations at the start of your net zero journey. Some sustainability projects are long-term investments and may not deliver immediate returns. Understanding this will help ensure that decision-makers do not immediately discount anything with a long-term payback. It helps if your plan also includes some short-term projects that offer immediate returns.
5) Get expert advice
It’s understandable if you feel overwhelmed by the task at hand, or don’t know where to start when developing your net zero strategy. That’s where expert advisors can help. External consultants can support you in understanding the practical actions and investments needed to meet your net zero goals on time, in assessing current solutions and strategies, and in identifying improvement areas.
With time fast running out to meet global carbon targets, we cannot afford to waste any more time. With other priorities on your plate, it may be tempting to delay decarbonisation for the future, in hopes of a better economic climate, more favourable energy market, or a more engaged workforce. But procrastination will only hinder your business’ long-term growth and success.
Starting now, even with a handful of low-cost measures, will help you benefit from reduced energy consumption and costs. Such benefits will compound over time, chipping away at your net zero goals and de-risking your operations. There is a great opportunity to achieve net zero and improve your resilience and efficiency as a result. It’s up to you to embrace it today.