How going green can lower your costs – and your consumers’ bills too

The UK has some of Europe’s oldest, leakiest buildings. Nearly 90% of offices need improvement to meet our 2030 targets, while UK homes lose heat up to three-times faster than more energy-efficient homes in Germany. Tackle that, and we’d be addressing an area responsible for 25% of our greenhouse gas emissions.

It’s no wonder Ed Miliband, Shadow Secretary of State for Climate Change and Net Zero, told delegates at the CBI’s Achieving Net Zero Conference that energy efficiency was the biggest no brainer in policy making right now.

So what can businesses do about it?

Helen Whately, Exchequer Secretary to the Treasury, says firms have a vital role to play – through tackling their own emissions, as well as investing in and innovating around solutions that will drive them down for others.

So let’s start with business’ energy efficiency, and start small if you need to.

Don’t be put off by the scale of the challenge, just start somewhere. It can be as simple as changing your lightbulbs – as it’s estimated UK SMEs could reduce their energy bills by up to a quarter through installing LED lighting, smart tech and other measures.

Get your head around the issue

But firms also need to get better at understanding their emissions to work out where best to find those efficiencies and benchmark progress.

Hitatchi Energy’s Ian Funnell suggests that business leaders should use a calculator to work out their personal footprint to help them get their heads around it – before reporting requirements and eagle-eyed investors makes it a commercial imperative to get this right.

And where it gets complicated, talk to other businesses, learn from what they’ve done and apply lessons from other sectors too.

Then consider the longer term costs of inaction

Energy prices are likely to be higher, for longer than we imagined, so don’t forget the bills of the future in all this.

Heathrow Airport’s Javier Echave believes accountants will decarbonise the world – and he has a point. When it can cost up to 10 times more to retrofit a building, for example, than it does to get it right first time, get your money men and women to present the options and think about the total life cost of investments you’re making (or avoiding).

Perhaps it’s easy to say in hindsight, but if we’d already put more investment into net zero, we wouldn’t be feeling quite so much pain now. It’s estimated, for example, that government cuts to climate policies over the last decade, including energy efficiency measures, have added around £2.5bn to the nation’s energy bills, costing households over £40 a year.

Let’s make sure we’re not in the same position again.

So what about helping consumers through the current squeeze?

Firms have a massive role to play in popularising decarbonisation – by doing what they do best: innovating with new products and services that inspire new behaviours.

We may be seeing reduced energy demand right now, says Chris Stark, Climate Change Committee, but stifling demand is not the way to net zero. “We need to invest to make it permanent.”

And, right now, that’s as much about investing in advice for consumers on how they can save energy and access any incentives that might help them adopt new technology, as it is about the technology itself, says Pheonix Group’s Tim Lord.

It’s about giving people choice. Giving them more power to use less energy. And the chances are, businesses will emerge through the other side of this crisis with an even bigger consumer mandate to go green and seize the global growth opportunities it provides.