Carbon psychology: The £860m opportunity for UK energy management
Retail, manufacturing and administration firms would be the biggest beneficiaries of up to £860m in energy savings across Britain if a "carbon psychology" approach is taken to improve business energy management processes.
That is the conclusion of the Business Solutions Carbon Psychology report released this week by npower Business Solutions (nBS). (Scroll down to read report).
At an event in London marking the report's launch yesterday (29 September), a panel of members from nBS, Tata Steel, Cebr, EEF and the Department for Business, Energy and Industrial Strategy (BEIS) revealed that effective behavior change initiatives could see companies in the retail, administrative and manufacturing sectors secure a 50% share of a potential £860m windfall.
The panel noted that, while the UK has “made strides” with energy efficiency, other countries such as Italy, Switzerland and Belgium are leading the way in energy intensity reduction. The nBS report recommends that behavior change – which is expected to account for 18% of UK energy savings by 2020 – could be vastly improved if the Government and businesses put the right incentives in place.
Speaking at the event, nBS’ carbon psychologist Phil Griffiths said: “There is a huge opportunity for bigger businesses here – and they don’t even need to invest to make substantial savings. The benefits of behavioural change on the bottom line are clear. Energy efficiency improvements result in a more motivated workforce, a positive impact on the UK balance of payments and significant emissions reductions.
“Energy efficiency is the goal and the vehicle is energy management. Modern day energy management comprises of three levers; people, process and technology, and in the UK we’ve got fantastic engineers which covers off the technology and optimisation, but there’s a need to develop.”
With help from the Centre for Economics and Business Research (Cebr) and the Carbon Trust’s 'Empower Savings Calculator', nBS found that retail could generate almost 20% in energy savings through behavior change platforms. Administration and support companies could reach beyond 11% in savings, while large manufacturers like Tata Steel could realise savings of just under 11%.
According to nBS, businesses that adopt the behavioural change scheme can generate savings between 5% to 36%. Griffiths noted that one company managed to generate 19% in energy savings, 17% of which derived from behaviour change.
Tata Steel, which is still adapting to life in a struggling steel industry, is one of the companies that has been working with nBS to track behaviour change. Speaking on the panel in London was the company’s energy manager Darryl Lewis, who claimed that too many companies were looking for “quick wins” and, as a result, have been missing out on the holistic managerial changes that new mindsets bring.
“There’s a tendency for people to look for quick wins as part of the evolution of trade,” Lewis said. “We’re trying to get all our dominoes in order, ready to push one and knock all our goals down quickly, but it rarely works like that. The key element to look at is the mindset of behavior. The key focus of an energy manager is to create a lot of other energy managers.”
With the report noting that behaviour change could cut business energy use by more than 8,400GWh, officials from BEIS have been keeping close tabs on the research and the potential savings that it could bring, to allow the government to achieve energy efficiency and carbon-related goals.
The newly-formed Department’s head of business energy tax and reporting Gary Shanahan noted that the focus of the report reflected the government’s objectives to promote energy efficiency. Shanahan claimed that if behaviour change was enhanced as committedly as technology is, it could provide huge benefits for companies - as well as shaping attitudes to new models such as Demand Response.
“The focus of this report reflects well with the focus of the department’s objectives,” Shanahan said. “Behavioural and technological change don’t have to be used in isolation and they’ll be more effective in combination. People will be interested in the easy wins and the effects that this will have on their bottom line."
Shanahan also claimed that the report was already outlining some of the business benefits offered up by government-led schemes such as ESOS, as well as “opening eyes” to the opportunities of the smart meter rollout.
The poor cousin
With the report outlining potentially huge energy and cost savings for the manufacturing sector, industry body EEF was also represented on the panel; explaining how only businesses could deliver these changes, and that “tick-box” activities such as placing posters on walls wouldn’t aid the energy intensive industry.
“Behaviour change in regards to energy management is very much the poor cousin compared to technical investments,” EEF’s senior energy and environment policy adviser Richard Warren said. “But technical change and behavioural change complement one another and unless people are engaged efficiency isn’t going to be optimised.
“The route of regulation would clearly not work and if you have something like behavioural change imposed on you from the government, then it’s going to lead to a very half-assed approach which leads to people ticking boxes. The change needs to come from within.
“Posters on the wall don’t tend to be as effective as a properly implemented strategy, such as appointing energy champions in the business close to where the energy is being consumed.”