Energy efficiency is on 80% of UK businesses’ agendas

The UK’s energy efficiency market has defied economic downturn, reaching sales of £17.6 billion in 2010/11, but a coherent governmental policy is needed if this upward spiral is to continue.

A report from the UK’s Confederation of British Industry (CBI) says that reducing the amount of electricity used by businesses has been overshadowed by energy generation even though energy efficiency has the potential to deliver a triple win for UK companies.

“The government should assess all energy efficiency policies that affect business and come up with a simpler approach, where any new initiatives truly add value,” said Rhian Kelly, CBI director for business environment policy at a round table meeting today.

“Meanwhile businesses also need to step up to the challenge. We have seen progress from many companies but others need to make the leap, showing strong leadership at the top with robust structures put in place to manage energy use.”

The conclusions in this report were drawn from a survey of 100 CBI members, in-depth interviews with over 20 members, and round table meetings with a small group of businesses.

Michelle Hubert, CBI principle policy advisor on energy and climate change, said: “The recommendations we’ve set out are deliberately focused at both business and government because we don’t think this is something that we can lay all the blame at the government’s door – we think there’s certainly a role for government to play – but business has to step up itself and also take charge of that.”

The role of business in implementing best practice for energy efficiency is to “make it everyone’s business” said the report.

Accountability should not lie solely with the sustainability team or the energy manager, but awareness should be spread across all employees. From the boardroom to the finance department, everyone needs to play their part.

Hubert said the sustainability and financial teams need to “work closely together to make sure that the best case possible is put forward to CEOs because I think a lot of the more senior people in the organisation probably underestimate the value of energy efficiency investments.”

The report cited retailer Waitrose’s “local champions” initiative which encouraged staff to get involved. The company offers employees prizes for the best suggestions to improve energy efficiency.

The CBI also recommends that the private sector needs to establish robust processes to measure their energy use – with methods ranging from state of the art systems to simple spreadsheets in order to select the most cost-effective solutions as well as to assess the effectiveness of the energy efficiency measures chosen.

The CBI states the government needs to re-double its efforts to deliver a coherent energy efficiency policy framework, which businesses have so far been lacking, according to the report.

Last year, the Energy Efficiency Deployment Office (EEDO) was set up to support the delivery of policies to businesses.
However, interviewees for the report said EEDO has yet to fulfil its raison d’être.

In order to deliver on its potential and become a truly effective body, the CBI states EEDO should step up its efforts in three key areas.

Firstly, it must deliver on its mandate to ensure that energy efficiency policies are coordinated across government. For example, it remains the case that heat and electricity policies sit in different teams with little crossover. EEDO could help to bridge that gap.

Simple policy delivery is also recommended. The report states that businesses have too often been hindered by overly complex policies which often overlap, adding extra cost and burden with little environmental benefit.

Finally, EEDO should look to strengthen its engagement with business during each stage of the design, implementation and communication phases of the policy process.

Hubert concluded: “Where previously energy efficiency was just seen as cutting costs and managing risks, increasingly businesses are seeing this as an opportunity to improve their productivity, getting a competitive edge and grow their market.”

Read more