Is Business Energy Even Worth Bothering With?

Within the environmental sector exists one longstanding assumption: businesses can only be motivated by money.

That’s all very well and good so long as every environmental issue can be remedied with a cost-saving solution. Which in turn means that those of us who want businesses to reduce their environmental impact have to spend our time turning every environmental improvement into a bottom line benefit.

This isn’t always easy. The rough cost of leaving a PC on overnight? 20 pence. Probably less than the wages accrued by a person who sits idle whilst their PC boots up in the morning. As Chris Goodall points out in his useful report on office energy use, many businesses make the quite rational decision to let employees choose for themselves whether they switch PCs on or off. There’s little economic imperative to enforce a switch-off and certainly not enough to warrant a large-scale, time-consuming awareness raising campaign. This despite the plethora of online guides encouraging just these same awareness-raising campaigns. Why are these agencies (to which I suppose I belong) doing it? Because they see the 1% energy saving it achieves as a big deal, which it is, but only if everyone does it. On an individual level, a business is frankly not going to notice a 1% electricity bill saving. If they have any clout whatsoever they can negotiate a 1% energy bill saving with a single phone call to their energy supplier.

Even very large companies, who have energy bills in the millions, don’t necessarily see a benefit in a £100,000 saving if it takes time and energy away from core business activity raking in billions. It’s a bit like asking a millionaire to buy a value tin of beans. Why should they?

As it happens most businesses have an energy spend of less than 1% of turnover. Even tiny businesses (like the one I had, sigh…) are unlucky to have an energy spend above 4% of turnover. Of course, it represents a greater share of profit, but it’s still not going to be the reason a business goes bust, unless they do something stupid.

So are we wasting our time trying to make business owners and managers focus on something which is ultimately neither here nor there in terms of their financial success as a business? Well no, we’re not, because the real reason for our efforts has nothing whatsoever to do with money, it’s to do with the fact that businesses are a key reason for the current level of emissions which are waaaaaaay too high to be considered sustainable.

The average carbon footprint of an employee whilst at work is around 5 tonnes CO2e/year. That is 2 tonnes more than has been estimated as the total maximum average (at work and home) to allow us to avoid runaway climate change. And that’s before you add in the personal carbon footprint of everyone when they’re not at work which, in the UK, is around 12 tonnes CO2e/year (a lot of which is because of our reliance on stuff we buy from… businesses!).

At first glance, this looks frankly ridiculous. People who work emit around 17 tonnes (either by themselves or through their business activity) a year?! The 3 tonne target looks like a tiny impossible dream. Which it probably is.

So we’re not wasting our time, we might just be using the wrong argument.

But there are some positive signs. Looking at Chris Goodall’s report again it is clear that 3.62 of the 5 tonnes comes from energy. So a de-carbonised energy supply would go a long way to reducing these emissions, without the business having to do anything (so long as renewables can replace the energy demand required). A further 1.65 tonnes comes from transport, most of which is air travel so could be reduced by teleconferences etc if there was some kind of international moratorium on business flights (yes I know this would kill airlines, but better that than killing millions of innocent children, right?).

On the downside, the 5 tonne “worker footprint” is probably a gross underestimate seeing as it excludes one of the key causes of emissions: consumption. Very few businesses have accounted in their footprint for the products and raw materials they use to carry out their business. And it’s not just computers. I’m talking about the glass and steel in building new offices; the plastic in the telephones; the paper; the raw materials that go into everything that business makes. The whole gamut.

So, why don’t we spend our time persuading governments to restrict business emissions? Well in part because we recognise the benefits of business. Employment brings with it a sense of worth. Production of essential goods is an essential part of a flourishing society. Most people who work are happier than those that don’t. Businesses contribute to taxes which provide things we rely on, including our healthcare system, transport network etc etc.

So we’re in a tricky place. On the one hand we desperately need businesses reduce their carbon footprints and on the other we desperately need businesses to keep employing lots of people in meaningful work.

And the answer to this conundrum?

Me neither, so we may as well keep trying…

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