Steve Barker, head of energy and environmental care for Siemens Industry UK, asks how UK organisations are rising to the challenge of energy management?
For many businesses the requirement to tackle the challenges presented by improving energy efficiency and energy management performance is abundantly clear. Energy costs are now accounting for an increasing proportion of company costs, and with energy prices set to remain high and unstable, it makes good business sense to ensure organisations optimise energy use as far as possible. Pressure to continue addressing energy will only intensify as the government strives to deliver on its commitment for a low carbon economy by 2050.
Against such a background, some interesting facts and figures continue to remind us all of the ongoing issues the UK business community faces as it looks to its current and future energy needs. Siemens recently undertook research among 600 businesses of all sizes and from a variety of sectors to try to ascertain how they were reacting to the green agenda. A number of interesting statistics emerged.
Some examples from the research, which is titled ‘The Green League’, support the belief that we still have some way to go to ensure businesses are on top of the energy management conundrum. It emerged that only 69% of energy managers believed that their organisation was taking energy management ‘seriously’, with 40% of companies saying they thought they were making ‘good progress’ in terms of energy management targets.
Worryingly, just over a fifth (22%) of energy managers within organisations admitted that they didn’t know what their company spent on energy, and half of senior managers and directors were unaware of their company emission levels. On a positive note, 70% of organisations said they did plan to invest in energy efficiency measures over the next three years and 40% of companies claim to be working towards energy management standards such as ISO 50001. A fact that does provide cause for optimism.
Knowledge and attitudes
Adding to Siemens’ own research, the recent CRC league tables showed a mixed picture and this inconsistent theme is supported by evidence from ongoing site audits that demonstrate that most organisations across industry and commerce can still reduce energy and utility consumption by at least 20%, using cost effective measures. Transparency would still appear to be an issue as the 22% of energy managers who do not know their energy spend highlights. Indeed, this is supported by the fact that while half of directors believe they know carbon emission levels, they consistently underestimate the actual total.
The CRC has been a force for good and has encouraged companies to apply automatic metering for their fiscal supplies, but there is still a low engagement with effective AM&T systems that can deliver one of the fastest payback technologies when correctly implemented.
Cost reduction appears to remain the key driver for reducing energy consumption and emissions. For organisations the realisation is dawning that energy efficiency offers excellent returns on investment. Many companies say they plan to invest in energy efficiency solutions, but with the fact that the Siemens research indicated only a small number of energy managers held energy management qualifications, it is somewhat uncertain if such solutions will be optimised.
The key message to commerce is that investment in correctly planned and implemented energy efficiency programmes offers proven positive cashflow, and adopting a systematic approach will maximise a return on investment and minimise energy consumption levels and emissions. Positive cashflow finance models are readily available to support implementation of cost reduction investments.
Short term, the forthcoming round of purchasing CRC allowances will certainly concentrate the minds of those affected and help to prioritise energy management further up the business agenda. In addition, the temporary easing of energy prices due to a comparatively mild winter must not divert attention from the long term necessity for the business community to continue to implement energy management systems that will monitor, measure and improve energy consumption levels and, ultimately, drive value back into the organisation for the foreseeable future.
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Tables: some of the findings of ‘The Green League’ research. Full version can be downloaded at www.siemens.co.uk