Aside of some amazingly conservative estimates by the old Department of Energy & Climate Change, which illustrated the benefits of the country saving just 0.7% of its energy consumption via its flagship Energy Saving Opportunities Scheme (ESOS), the answer is still VAST.
Depending on how much has been done to date – and in far too many cases this is still zero – organisations of all shapes and sizes have clear potential to save as much as 50% and even more in extreme cases. Monetary savings running into millions of pounds are not being captured even by many large organisations. A whole range of reasons is quoted for this failure from lack of expertise, funding, other core business priorities and many more.
In truth, the reasons are more likely to be lack of management commitment, focus on the short term, sloth amongst others. More worryingly it also means a lack of challenge from key stakeholders who see vital resources being unnecessarily being wasted.
It’s worth recalling the level of success and the consequent benefits, which the more foresighted have managed to achieve already. The retail sector, which has been amongst the leaders in retrospectively applying energy efficiency for many years, provides many examples of companies making annual savings now running into tens of millions of pounds a year. When viewed cumulatively and with an eye on future higher energy prices, the contributions to profitability of the value of savings are significant, especially in an environment where margins are under extreme pressure.
Even in organisations that have a positive attitude towards improving efficiency there can still be a relatively narrow focus on the type of measures which can deliver those savings. Tried, tested, proven schemes are fine for universal application but there needs to be a more holistic view which includes “thinking outside the box” and introducing, for example, different management processes, including the way in which funds are budgeted to and allocated for energy efficiency projects.
Much has been written and spoken about behavioural change in this space. Clearly there is a role for it to play, particularly early on in new programmes and for those that have done little historically. The behavioural change for those with a track record of efficiency now needs to fan out to include functions which may not have been included the first time around and move from the “coal face” to the “engine room” and the design studio.
What is often needed is a change in attitude which can enable the behavioural changes.
Those in the property world charged with the acquisition of new buildings, or indeed the design and delivery of refurbished ones, are good examples of where a different way of thinking would be beneficial in identifying and quantifying the long term benefits.
Still the principles of Whole Life Costing aren’t fully considered by a relatively short term focused financial community. Changing mindsets and resulting behaviour here is massively important if long term aims are to be met.
Most importantly, for me, is having dedicated access to energy professionals who are trained to challenge the status quo and who aren’t prepared to be fobbed off with the reasons why things can’t be done. Challenging can often appear to be full of negativity when, if objectively analysed, it is quite the reverse in providing a stream of positive outcomes.
Short term approaches to energy efficiency can prove very productive for those companies that have done little before but the focus has to be on the long term if benefits are to be maintained and continuously improved.
Organisations, especially SMEs that have so far slipped through the wider regulatory net when it comes to energy and transport efficiency, need to be heavily encouraged by government to produce and publish effective plans supported by effective measurement of success.
Ideally all businesses should have published targets for improved efficiency – 20%-50% could be a realistic ambition for many depending on sector/activity – with a requirement to quantify their annual kWh/carbon savings against a meaningful baseline. With improving standards of data capture this should be a minimum requirement.
More should also be done to highlight the ever-extending range of successful efficiency products and schemes and to develop heightened awareness of where they will (and won’t) work to best effect.
Some major but urgent priority challenges for the new Business & Energy Secretary Greg Clark to address as part of his brief for sure.
Mervyn Bowden is the MD of Intuitive Energy Solutions.