Utility Week

UTILITY WEEK | 10TH - 16TH JANUARY 2020 | 13 Policy & Regulation "Business leaders are increasingly committing to reducing emissions, but they need to follow up words with action." View from the top Ben Spry, Npower Business Solutions, Energy HQ C OP 25 marked the culmination of a year where public awareness and activism over climate change reached an in ection point. The UN's trou- bling forecast last month that global emissions show no sign of slowing at the rate needed to prevent profound ecological and economic changes has further reinforced the sense of urgency expressed by the Extinction Rebel- lion movement. It is easy to think business leaders do not also rec- ognise the need for urgent action. Yet, in the past few months alone, more than 100 international businesses, from L'Oréal to Ikea, have set targets to help limit global warming to pre-industrial levels of 1.5C by 2050. This is vital. Businesses of all sizes together make up a signi‰ cant proportion of global energy consumption, and so will play a crucial role in the mission to reach the net zero target. Policy changes at a national level will also be key, but businesses need to do their part to drive this change within their own organisations and industries as well. However, making this commitment, while positive, is just the ‰ rst step. Emissions targets are only meaning- ful if business leaders put plans in place and take the necessary measures to get there. This goes beyond simply trying to reduce consump- tion. It requires a fundamental shiŽ in the way busi- nesses approach energy supply and management. That is, the approach needs to change from one where energy is viewed as a necessary but peripheral cost, to one where it is embedded in a business's overall strategy and long-term growth trajectory. Despite the mounting public response to climate change in the business community, it seems other fac- tors may still be taking priority when it comes to actual energy policy decision-making within organisations. In a recent survey by Npower Business Solutions, Energy HQ, carried out among a cross-section of UK energy managers, only 18 per cent of respondents said reaching sustainability goals is their top busi- ness priority. Instead, pressures to look aŽ er their organisation's bottom line took precedence, with 48 per cent of energy managers admitting that sav- ing business energy costs remained their primary concern. Clearly, short-term ‰ nancial pressures are detracting from companies' abil- ity to meet their ambitious future sustainability targets. While this is understandable, a shiŽ in mindset is required so that commercials and sustainability are no longer seen to be in con ict. Energy managers and executives will bene‰ t when it is realised that achieving energy e˜ ciencies across an organisation can help to reduce both costs and emissions. The greatest way businesses can start to take a longer-term approach to energy and sustainability is by investing in renewables and exibility services. By investing in wind, solar or other forms of renew- able on-site generation, businesses can curb their reli- ance on fossil fuels and, at the same time, gain greater autonomy over their energy use and supply. Combining renewables with battery storage also allows companies to start e™ ectively engaging in demand-side response (DSR). By limiting energy use in peak hours, and poten- tially selling surplus energy back to the grid, companies can play an active role in helping support the more decentralised energy grid of the future. As we accelerate towards a more renewable energy industry, the degree to which businesses can be exible with their energy consumption will be vital to accommo- date the uctuating supply that comes with wind, solar and other forms of renewable generation. Electri cation of transport A business's energy usage is oŽ en considered to simply entail the energy consumed by its various o˜ ces, fac- tories and other buildings. However, many businesses operate large transport eets that remain one of the big- gest challenges to meeting sustainability goals. While the government has set a phase-out of petrol and diesel vehicles by 2040, this doesn't mean busi- nesses should not explore transitioning their eets to electric vehicles (EV) today. This is particularly the case as EVs have become far more commercially viable in recent years – the cost of EV batteries dropping by more than 80 per cent in the last eight years. It can seem like EVs are another issue thrown into the mix, adding to the conundrum facing businesses: which sustainability challenge do I tackle ‰ rst? Transport, energy consumption and reliance on the grid or heat. However, transportation and the e˜ ciencies that can be achieved through EVs is not an area that should be overlooked. The rallying of the business community to tackle climate change will be one of the most decisive develop- ments and factors in achieving net zero. However, a 2050 plan to reduce carbon emissions requires businesses to think and plan in equal lengths of time. This will be key to success if business leaders' sustainability ambitions are to marry up with reality. Ben Spry, head of flexibility services, Npower Business Solutions, Energy HQ Despite the mounting public response to climate change in the business community, it seems other fac- tors may still be taking priority when it comes to actual energy policy decision-making within organisations. In a recent survey by Npower Business Solutions, Energy HQ, carried out among a cross-section of UK energy managers, only 18 per cent of respondents said reaching sustainability goals is their top busi- ness priority. Instead, pressures to look aŽ er their organisation's bottom line took precedence, with 48 per cent of energy managers admitting that sav- ing business energy costs remained their primary concern. Clearly, short-term ‰ nancial pressures are detracting from companies' abil- ity to meet their ambitious future sustainability targets. While this is understandable, a shiŽ in mindset is required so that commercials and sustainability are no longer seen to be in con ict. Energy managers

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