How and why do companies make energy changes?

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Gripple shop floor- R.Tyszczuk

Through speaking to firms across South Yorkshire and the Derwent Valley and spending time with them on site, we have been learning about the challenges they face in relation to energy. The manufacturing sector is a high-energy consumer, and is therefore the cost and security of energy is of huge importance. 9 out of 10 companies in the UK are discussing energy at board level, and define it as ‘business critical’, and two-thirds plan to increase investment in energy management in the next twelve months.[1] Whilst the impact of energy change could be seen as a risk to industry, it also suggests that companies will be focusing on how to reduce their energy costs, and directing time and effort towards this objective. Yet, according to research by German company Siemens, only half of UK firms are planning their energy strategy 5 years ahead, with the majority looking only into the next twelve months.

A recent Swedish study, [2] written by a Professor of Energy Systems looking into what the barriers were to manufacturing companies adopting energy efficiency measures found the most important factors were perceptions about cost and risk of adopting new systems, the prioritising of other concerns, and the lack of knowledge about the consumption of different parts of the company (such as might be achieved through sub-metering). The question of risk also occurred in our conversations at factories across the region; technology was seen to be changing rapidly, government policy was seen to be short-term, and yet firms would have to make choices about investment for the next ten or twenty years. Other problems identified included the inability to get good impartial advice about their options, especially when they were proposing large-scale change or new renewable-driven systems. In understanding a company’s decision making process, it is important to note that a focus on energy-cost savings does not necessarily imply a reduction in carbon, as a change in fuel mix to a cheaper option does not guarantee there is less carbon emitted for a given amount of delivered energy.

Yet, it is not all bad news- the Swedish study also found impetuses for energy change- these were driven by individuals who had a passion to change things and those companies that developed strategies across their whole site. Again this was something that rang true with the stories we had been told and the factories we had visited. A reduction in consumption may be achieved by a change in energy intensity, where less energy is used to produce the same output; yet often energy innovation goes far beyond technology. At Gripple it was through involving employees in decision-making together with a strong company ethos that drove change. As an employee owned company, everyone takes an active role and responsibility for how and why energy is used. Motivated by social responsibility as well as potential cost-savings, Gripple worked with the Carbon Trust to consider their carbon footprint. Challenging the Trust’s measure that just focused on the company’s main factory site at The Old West Gun Works, Gripple instead chose to look at their whole supply chain. This included the goods they produced, and the activities of suppliers and employees in other countries. This process raised awareness of the impact of materials such as zinc, but also the positive contribution of new products produced by the firm, such as the Loadhog storage system, which reduced waste and cut transport energy use for firms worldwide. It is through such approaches that companies might have a real impact on our energy futures.

[1] http://www.ft.com/cms/s/0/8f3df8bc-2ecd-11e4-a054-00144feabdc0.html#axzz3qip8Elfm Financial Times, Business and Economy August 31, 2014 3:17 pm ‘Concern grows among UK manufacturers at rising energy costs’ By Tanya Powley, Manufacturing Correspondent, Access Date, 06/11/15

[2] P. Rohdin and P. Thollander, ‘Barriers to and Driving Forces for Energy Efficiency in the Non-Energy Intensive Manufacturing Industry in Sweden’, 2006, Energy, (31), 12, 1836-1844.

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One response to “How and why do companies make energy changes?

  1. Pingback: Should energy be boring? | Future Works·

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