Most large companies have set ambitious decarbonisation targets. Yet many companies only have pockets of detail on how these will be delivered. Some organisations don’t have a plan at all. Targets for 2030 or 2050 may seem like a long way away, but net zero cannot be achieved overnight. Action must be taken now for the benefit to be realised in time.
In the years ahead, new energy technologies will become available that have the potential to accelerate net zero ambitions. These technologies will build on the solutions businesses can implement today. Organisations will want to capitalise on these new developments, rather than be constrained. So it’s important that any sustainability strategy formed today is flexible enough to handle any changes that happen. The downside is that this means your organisation can’t necessarily plan for all eventualities in your sustainability strategy.
In this blog, we explore some of the common obstacles that may occur on your sustainability journey and suggest ways to find the right balance in overcoming them.
It’s important that there’s harmony between your carbon reduction goals and your wider business objectives. How can decarbonisation help your business to achieve its commercial objectives? The answer to this question will help you gain – and maintain – senior leadership support.
But business objectives are continuously evolving. And the energy landscape is changing too – both in terms of technological advances and the wider regulatory environment. This can make it difficult to keep business and energy strategies aligned. It can also make it hard for businesses to continue building expertise in all areas relating to energy strategy, while delivering against the wider business priorities.
You cannot “set and forget” your business strategy or your energy strategy. Both are going to evolve, so there needs to be a plan for that. Having clear goals is critical. These goals will inevitably need to be aspirational, given that in some cases the technology to achieve them is still being developed. But having goals provides clear direction, drives creative thinking and provides a benchmark for ensuring strategic alignment.
To keep your sustainability and commercial strategies in balance, it’s also important that one doesn’t negatively impact the other. For example, making sure that sustainability measures are carefully scheduled and co-ordinated, to manage the impact on business operations.
Some people believe that organisations cannot reduce both their carbon emissions and their energy costs. They think that becoming more environmentally friendly is a drain on resource and budget; and that focusing on reducing energy costs means that low-carbon energy technologies are off the agenda.
In reality, this isn’t true. Organisations don’t have to choose between their environmental and financial responsibilities. These two demands are not conflicting or mutually exclusive. In fact, the most successful organisations are developing strategies that deliver both economic and environmental sustainability, and ensure they are a sustainable business for the long term. They recognise that strong environmental credentials are essential for future profitability. They also recognise that implementing low-carbon technologies doesn’t necessarily require large capital investments.
Organisations can simultaneously deliver commercial and decarbonisation results by implementing energy solutions that unlock savings up-front, which are then used to fund the implementation of low-carbon solutions in the longer-term.
For example, CHP can achieve substantial cost and energy savings while providing secure and flexible energy and heat, as part of a single, high-efficiency cogeneration process. It can deliver a rapid return on investment – often delivering a payback within two to three years, which makes it one of the best energy-saving solutions available. This provides opportunities to use cost efficiencies to fund pure green technologies with longer paybacks and more marginal economies.
What’s more, additional value can be delivered when CHP is combined with solar PV. CHPs are optimised for generating constant power over long time periods; while solar generation provides very cost effective and clean energy, but only during daylight hours. Organisations whose demand peaks during daytime may find this an ideal combination.
Clearly this isn’t a short-term approach. Blending internal expertise and with credible external partners with specialist knowledge of how best to combine different energy solutions can ensure that the cost vs. benefit objectives of sustainability are kept in balance.
With the rising focus on sustainability, many companies are struggling with how they achieve this culturally. Sustainability cannot be owned by one team or department. It requires company-wide participation and collaboration. But this can mean a potential shift from how the company has operated in the past – and cultural change is often the most difficult aspect of any transformation project.
It’s important to identify – and resolve – any areas where your existing culture may conflict with your move towards sustainability. For example, if your people are currently focused on short-term deliverables, you’ll need to work to make it acceptable and celebrated to take longer-term views and act in a sustainable way. It’s important that your people understand that sustainability cannot wait until tomorrow. You may not currently have all the answers on precisely how you’ll reach net zero, and some of the technologies that are required may not be commercially viable right now. But sustainability is a marathon, not a sprint. If your teams are culturally empowered to make changes today, this can only accelerate your longer-term progress.
It’s also important that you’re really clear on the direction of travel. Remove ambiguity by being clear on which parts of business operations are in-scope for sustainability. Set clear paths of accountability that make it clear who is responsible for progress against the plan and how is this monitored. Make sure the right resources are in place, so sustainability isn’t seen as a drain on operations. Minimising the impact on business operations will make cultural change more easily accepted.
When you’re clear on the direction of travel, this needs to be effectively communicated to the business. Consistent communication is important to nudge change in the right direction. Simplified communications and a common language for sustainability can help build a joined-up approach.
It’s inevitable that conflicts will occur during your sustainability journey. But they cannot derail your plans. It’s important to have a sustainability strategy that’s flexible enough to evolve to changing circumstances and priorities; while being fixed enough to keep you on the right trajectory to hit your goals.
We believe that organisations can get the right balance by following an Energy Pathway approach. It’s a structured methodology for planning each stage of your sustainability journey, underpinned with the right phasing and touch points to ensure business-wide alignment, even as priorities change. This approach can de-risk sustainability risks and demonstrate clear progress against your decarbonisation goals.
Whatever approach you choose to take, your ability to overcome conflicts during your sustainability journey will be the difference between capitalising on new developments and being constrained by them.
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