We need to be ambitious to reduce business energy consumption

Kevin Greenhorn, Managing Director, Energy Solutions, SSE Enterprise

The Government recently set out its plan to improve energy efficiency in businesses by 20% by 2030. This is a step in the right direction – but to those of us who help business use their energy more efficiently; it’s nothing like ambitious enough. Energy optimisation and reduction must be made central to a businesses’ strategy, and only by pursuing an ambitious target can the Government ensure this takes place.

We know that inefficient energy usage can hit the productivity and profit of businesses, but at the moment not enough is being done to facilitate or incentivise change. In 2015, business used 422TWh of energy, of which nearly half was used in buildings – the scope for improvement is huge.

So what can be done? Awareness is paramount, providing energy efficiency advice and support that is clear, simple and accessible will be critical to success. As 50% of energy consumption is through SMEs, bespoke support needs to be produced for this sector, where possible working closely with trade bodies to make sure the message reaches the right audience. To be impactful guidance must demonstrate the clear benefits and impact on the bottom line.

To support the improved awareness there must also be corresponding incentives to stimulate action. Currently most of the legislation encouraging behavioural change is punitive, but if the Government really wants to see significant improvement in energy reduction then the tax breaks provided will need to be made deeper, with a larger benefit provided for selecting for the most effective and efficient products. Accreditation for reaching certain levels of efficiency could be a driver for more public facing businesses, where reputation matters.

The ability to obtain quality data is also critical to progress. It is anticipated that Internet of Things ‘IoT’ technology will enable a much better command of ‘big data’, helping to provide new insight which can then be turned into meaningful trends and indicated actions. In the nearer term the introduction of half-hourly data is of critical importance as it will see the end to the scourge of estimated bills, which can make it difficult to accurately assess project benefits.

Improved data will also allow for better benchmarking across business sectors. In the competitive business environment being able to demonstrate that a business is operating below the industry standard can be an invaluable tool to incite action. While there has been some benchmarking done previously this is now out of date, a government run online benchmarking tool could provide a suitable trusted source of insight.

By reducing their energy use businesses can become greener, more efficient and more productive. Now is the time to be ambitious, the business community and the wider environment only stand to gain.