The sleeping giant of the energy transitionRasmus Valanko, Managing Director, Systems Transformation
This post first appeared on Business Green.
The Russian invasion of Ukraine has sent shockwaves through Europe and around the world. Whilst the immediate humanitarian crisis must be the highest priority, the longer-term implications are also becoming apparent. Reliable access to affordable energy is in jeopardy due to the rising costs of an energy system still too reliant on fossil fuels.
The policy and business solutions to tackle both the energy and climate crisis already exist. Energy efficiency, in particular, remains the ‘sleeping giant’ of climate action. It’s time to harness the potential of using less energy alongside rapid installation of renewables and electrification of key systems like transport. To make this happen we need businesses of all sizes to lead.
Any corporate response must be accompanied by significant policy action from governments. Businesses and governments working together to increase energy efficiency has the potential to be game changing.
Let’s put this into perspective: just 1% improvement in Europe’s energy efficiency will result in a 2.6% reduction in gas imports.
If you already have an energy efficiency program at your company, now is the time to prioritise those investments. If you do not, here are 5 steps companies can do right now:
1. Look at easy wins in your buildings: Companies committed to EP100, the Climate Group’s energy efficiency campaign, are taking manageable but impactful steps, which include turning down the heat or aircon, cleaning windows, installing LED lighting and using innovative technology to capture data from Energy Management Systems.
2. Take energy efficiency in buildings a step further. Retrofitting older buildings with better insulation and efficient windows can reduce wasteful heat loss. Switching to heat pumps for space heating where possible will save energy now and costs in the long term. If you’re commissioning any new buildings, ensure energy efficiency is optimised in the design phase.
3. Check all your equipment and materials: Swap out inefficient appliances like printers, computers and monitors or refrigerators. Check whether equipment like industrial motors and pumps are operating as efficiently as they can. Join the many EV100 companies switching their fleets to electric.
4. Increase the efficiency of materials use: Use recycled steel or other materials in construction and manufacturing. Design products in a way that uses less materials overall.
5. Work with government to scale energy efficiency programs: History has shown that individual actions when accompanied by policy changes and government campaigns can achieve major shifts. Companies tell us that a lack of policy incentive is one of the top two barriers to increasing energy efficiency. Therefore, use your voice to call on energy and finance ministers to create policies that allow the scale up of energy efficiency solutions. Conserving energy in the face of a global crisis to curb dependence on imports and price rises is not a new concept – and can bring many benefits. When Japan was faced with energy shortages following the Fukushima nuclear plant disaster in 2011, the government launched a national energy saving campaign. Initiatives included rationing energy for large industry and in just four years, electricity consumption fell 12% in industry.
In 1973, when oil import prices from the Middle East spiked, Denmark rapidly reworked its energy policy as the country was at that time importing oil to meet 80% of its energy needs. The Danish government implemented policies to reduce its dependence on oil for generating electricity and incentivised Danes to drive less. The amount of oil in Denmark’s electricity generation mix fell to just 5% by 1983. Today, Denmark is one of the most energy efficient countries in the world and famous for its cycling cities.
Energy efficiency should not be overlooked in discussions on the energy transition. In this period of great turbulence in Europe, waking the sleeping giant of energy efficiency is a shortcut to greater stability and security for business and communities.