How are businesses measuring up when it comes to sustainability?

Sustainability How are businesses measuring up when it comes to sustainability?

As part of our recent ‘Sustainability in the C-Suite’ report, we asked 80 financial directors to tell us about their business’ approach to sustainability. While we found differing levels of commitment, our report revealed that most organisations are making efforts to reduce carbon emissions.

Plan to make an impact

Despite most respondents stating that they were trying to cut emissions, less than half (49%) have a corporate sustainability plan in place that they are actively working towards. Around 16% said they have a plan in place that they are yet to implement, and over a third (34%) of businesses have no sustainability plan at all.

Data - the measure of success

When asked about how they measure the success of carbon reduction methods, almost half (43%) say they can accurately measure their energy consumption throughout their organisation. Almost 38% of FDs said that they aren’t able to precisely measure their usage and almost 20% said they weren’t sure whether they can or not.

We’ve found that the availability of data is a common stumbling block for businesses wanting to reduce their carbon impact. While your organisation may have ambitious targets in place, without a solid understanding of current consumption, it’s almost impossible to determine the effectiveness of your actions.

Scope 3 emissions

Among those who have a carbon reduction plan in place, our report found that 55% are focusing on Scope 1 & 2 emissions. Slightly fewer companies are including Scope 3 emissions in their carbon reduction plans, with 47% measuring the emissions created from sources they don’t directly control.

The term Scope 3 relates to indirect emissions and covers both upstream and downstream activities. Upstream activities include purchased goods and services and business travel by means not owned or controlled by an organisation, while an example of a downstream activity is the end-of-life treatment of sold products.

While measuring Scope 1 and 2 may be straightforward for many organisations, especially if they are required to comply with SECR, getting to grips with Scope 3 may prove to be a little trickier. However, Scope 3 emissions can make up a significant proportion of a company’s overall emissions (upwards of 90% for some companies), so companies who are serious about sustainability will need to include these if they want to give an accurate picture of their carbon footprint.

Getting invested

It’s widely understood that investment is needed across all sectors if we’re to reach net zero. Most of the businesses we questioned were planning to invest more in energy efficiency during 2020, although the ongoing effects of the pandemic have undoubtedly halted plans for some – one respondent told us that “COVID-19 is going to place huge restrictions on discretionary investments.”

When discussing barriers to investment, 53% of FDs said that there are too many competing priorities for capital investment, and that this is only likely to increase due to the impact of COVID-19. Others (40%) shared that it is difficult to demonstrate a tangible return on investment, and 31% said that they were unsure of the best technologies and measures to invest in.

Sustainability success

Understandably the challenges of 2020 have meant that businesses have been left to juggle competing priorities. However, the climate crisis remains a priority for government, and business leaders must remain committed to driving down emissions and putting in place their own rigorous sustainability programmes. For information on how to develop your roadmap to sustainability success, download the ‘Sustainability in the C-Suite’ report here - https://inspiredenergy. co.uk/landing/report/

Sustainability 4 things most people don’t know about their energy contract

The last 12 months have been turbulent. Many organisations have faced unprecedented uncertainty, with a return to business as usual still out of sight.

The past year of rolling lockdowns - local, regional, and national - has bled into a new year, where we face both economic uncertainty and continued restrictions. Saving money and staying afloat will be the top priorities.

All businesses will have outgoings at a time when income is not guaranteed. Your energy contract is unlikely to be front of mind, but over the course of the pandemic we’ve seen businesses renewing their contracts, rather than shopping around or falling into rollover rates.

Businesses are looking for certainty and stability at a time when it’s been hard to find. Depending on the exact terms of your energy contract, there may still be room for uncertainty.

Now is the right time to familiarise yourself with your energy contract and to look for those charges or elements that could have an impact on your business.

Increases in Third Party Costs

The total cost of energy comprises lots of various charges. Only around half of the final cost of your bill comes from electricity. The rest comes from third party costs (TPCs).

These costs - also called non-energy or non-commodity costs – include the costs of energy distribution and transmission, grid balancing, and environmental charges like the Climate Change Levy. These charges are paid for by energy suppliers, who then charge end users.

Customers on passthrough contracts will have these costs charged directly. Customers on fixed contracts should look closely to see which of the costs are fixed; some may not be.

Haven Power expect thirdparty costs to rise this year due to COVID-19. The pandemic created difficult circumstances for the energy network, making it more expensive to manage the grid. You can find out more about the impact of COVID-19 on the energy network here.

The additional costs incurred as a result will be passed through to suppliers.

Charges will increase to cover this cost. Some organisations that used less electricity during the pandemic may find their bills have fallen by less than expected, while customers who worked throughout the pandemic may find their bills are higher than usual.

To find out more about how third-party costs might impact you over the coming year, download Haven Power’s latest TPC guide.

Sustainability Harnessing digital for successful energy management

Covid-19 has forced everyone to rethink their relationship with technology. As organisations have found themselves forced into accelerating their plans for digital transformation to enable remote working and continue operating effectively, if you haven’t already, now is the time to consider how digital can support your energy management.

There are numerous benefits to digitising your energy management. Consolidating vast amounts of data into one place will simplify the complexities of managing energy across your portfolio as well as helping to cut carbon emissions, streamline resources, reduce overheads and implement new processes and policies. All positive steps when it comes to staying ahead of the game and differentiating yourself from key competitors.

As the UK Government looks to harnesses a green recovery to rebuild the country post the pandemic, recognising the positive impact digital technology can have on your own energy management will be invaluable.

Choosing the right energy management solution

Before you rush into choosing a software solution for your energy management, it is important to understand what you want to achieve. Knowing your long-term goals will help you to create a plan and set objectives before configuring your software, ensuring it becomes an integral part of running your organisation.

You will want to consider how your organisation operates and how your energy management software can help you to achieve internal targets. It is important to keep in mind the type of consumption you’re tracking and the data you would like to be seeing through target setting and monitoring.

Ensuring a smooth transition is essential when implementing any digital solution into your organisation. The importance of seamless onboarding of an energy management system will ensure your operations can continue without disruption. The system should be monitoring your operating hours to ensure no data is lost.

One of the key drivers for implementing an energy management solution is to ensure your organisation has the data needed to comply with legislation and regulatory requirements. A good digital solution will help you aggregate your data, and fill in missing gaps so you can produce accurate environmental reports to achieve successful compliance. With increasing public pressure on organisations to take climate action and with the Government’s target to reach net-zero by 2050, managing carbon emissions with complete transparency has never been so important.

You should also consider your organisation’s communication and engagement needs. With all your organisation’s data in one place, an energy management solution will have the capability to provide compelling consumption insights for all areas of your business. Dashboards and reporting tools can give you the ability to share and publish energy and utility related information with stakeholders and colleagues. Engaging the right people through sharing information in a simplified format, giving you the ability to present statistics and usage to a diverse audience.

Investing in the future

Despite the initial cost of moving to a digital approach, investing in technology to support your organisation’s plans for the future can ensure payback. Helping you to save money in the long term as you use your energy more efficiently, maximising your cost recovery opportunities and saving staff administration time.

To futureproof your investment, you want to look for a provider that is demonstrating a commitment to develop and grow their system, enabling you to continue to benefit from advancements in the technology. TEAM Energy’s commitment to evolve and improve their solutions is written into their mission and values as a business. The company’s suite of Sigma solutions is continually adapting to meet changing industry needs, and incorporates customer feedback into the development pipeline.

Digital and technology are not only becoming more affordable but also easier to implement and with greater accessibility, meaning organisations can monitor and manage energy remotely. A feature which is becoming increasingly important as working from home continues to be the new normal for many. The flexibility of a digital energy management solution means that you can identify anomalies in utility bills and generate cost recoveries from wherever you’re based, increasing the level of visibility and accessibility you have to your energy data.

Initiating change within an organisation can come with challenges. As an energy management solutions provider, TEAM still regularly see organisations with many years of consumption data tracked in spreadsheets, so recognise that the move to using one solution for managing, monitoring and reporting is a big change to an organisation’s processes and team function.

To help make sure your move to digital is successful, it is important to ensure buy-in from not only top-level management but also employees who will be working on the system. Gaining confidence and support in a digital strategy can take time, and it is important to provide a greater understanding of the benefits of the systems and invest in training for those who will be using the software. Using customer service support, software trainers and Key Account Managers, you can also ensure your employees remain up to date with the system, including any new updates and features. This will ensure you will always be getting the very best out of the software.

As organisation’s look to the future, the importance of digitising operations will become increasingly important. As the pressure builds on organisations to more proactively reduce their carbon emissions, many will need to adapt their current operations to ensure they can keep up. Through taking advantage of the digital technologies that are available, such as energy and sustainability management solutions, you can work towards meeting your internal sustainability goals and the wider target of net zero before further regulatory changes are imposed.

Starting off on the right foot is key to be able to utilise future technologies, by starting to prepare now, laying the foundations and investing in digital solutions early on, will ensure you are prepared for the future of energy and carbon management.

What’s next for your digital transformation plan?

In the current climate, we are seeing the UK Government increase funding around climate action as they aim to build back better and greener. The expectation is that we will also see further regulations surrounding climate action to be introduced. With this in mind, now is the perfect time to transform your energy management and invest in a monitoring and targeting solution, that can help you to meet the demands of your organisation, manage your energy usage and cut costs in the long term. Laying the foundations for a future in which your organisation’s operations are run digitally.

Business leaders must start to consider how they are managing their energy and how they can harness digital to become more energy efficient. Making the necessary reflections and changes to their structures; incorporating the right people, processes and technologies to ensure they can continue to grow in an ever-changing landscape.