A new study released by Schneider Electric finds that most organizations feel prepared for a decentralized, decarbonized and digitized future, but many of those companies are not taking the appropriate action to integrate and advance their energy and sustainability programs.
This false sense of preparedness may be due to the fact that most companies continue to take a somewhat conventional approach to energy management and climate action.
According to the survey of 236 large corporations (with revenues of US$100 million or more) from around the world, 85 per cent said their company would be taking action over the next three years to keep its carbon-reducing plan competitive with industry leaders, however these projects are often related to energy, water and waste conservation. Outside of renewables, few of the organizations represented are implementing more advanced strategies and technologies to manage energy and emissions.
Other key findings of the study include:
- Eighty-one per cent of respondents have made energy efficiency upgrades or plan to within the next two years; 75 per cent are working to reduce water consumption and waste;
- Fifty-one per cent have completed or are planning to pursue renewable energy projects;
- Thirty per cent or less have implemented or are actively planning to use new energy opportunities, such as microgrids and demand response;
- Only 23 per cent have demand response strategies or plan to in the near term.
“We are in the middle of a massive disruption in the way energy is consumed and produced,” said Jean-Pascal Tricoire, Chairman and CEO of Schneider Electric, in a press release. “The near-universal focus on conservation is a positive. However, being a savvy consumer is only a part of what’s needed to survive and thrive. Companies need to prepare to be an active energy participant, putting the pieces in place to produce energy, and interact with the grid, utilities, peers and other new entrants. Those that fail to act now will be left behind.”
A primary barrier to progress may come down to internal alignment. According to the study, 61 per cent of corporations said their organization’s energy and sustainability decisions are not well coordinated across relevant teams and departments, which is especially true for consumer goods and industrial businesses. Sixty-one per cent of respondents also said a lack of collaboration is a challenge.
Data management was listed as another barrier for integrated energy and carbon management, with 45 per cent of respondents noting that organizational data is highly decentralized, handled at local or regional levels. Of the respondents who identified insufficient tools or metrics for data sharing as a challenge for working across departments, 65 per cent manage data at the local, regional or national level only.
More than 50 per cent of respondents have initiated renewable energy projects or plan to do so within the next two years, with respondents in the healthcare and consumer sectors leading the way. In addition, the c-suite and corporate functions have a high degree of involvement in these and other sustainability-focused programs, as 74 per cent of respondents stated that c-suite members review or approve sustainability initiatives, indicating that these projects are seen as a strategic priority.
Although return on investment is the obvious benchmark for energy and sustainability initiatives, companies are beginning to take a longer, more comprehensive view of investments. For example, over half of the respondents said environmental impact is factored in to the evaluation process. Organizational risk (39 per cent) is another important consideration.
The study, which was conducted by GreenBiz Research, identifies how businesses develop energy and environmental strategies, collect and share data, and coordinate across departments, which is known as Active Energy Management. Participants included professionals responsible for energy and sustainability management across 11 primary segments, including energy/utilities, finance, industrial, healthcare and technology.
For a detailed summary of the survey and results, read the research report.