The recent fluctuations in the UK energy market have made it increasingly difficult for businesses to secure investment in green projects.
As we make strides towards meeting the UK’s 2050 net zero targets, it is vital that we focus on enabling businesses to achieve their net zero goals.
Sustainability initiatives hold significant benefits beyond simply reducing carbon emissions. If done right, they can lead to cost savings, attract environmentally conscious clients and investors, and even attract talented employees seeking to align themselves with environmentally conscious organisations.
Know your business
In today’s operating environment of tighter budget strings and increased ESG scrutiny, to ensure businesses can decarbonise, it is more critical than ever to develop accurate and compelling business cases for sustainability projects. The first step towards this is having a working knowledge of your business’s current energy mix and the peaks and troughs of energy consumption across various business use cases.
This information can be harnessed to understand where your business can make cost and carbon savings, which can be used to support the successful sign off, implementation and execution of sustainability projects.
Uniting a business’s net zero strategy with data and insights from within the business will build confidence among the C-suite and investors in the effectiveness of renewable projects, and thus expedite the drive towards net zero emissions.
A major part of developing a compelling business case for sustainability initiatives is demonstrating the financial viability of green energy schemes and demonstrating the potential returns. Here, accurate data is essential to enable decision-makers to see the realities of these investments.
For example, leveraging platforms that use data modelling to demonstrate how installing solar panels and comparing financial impacts of leasing them, using capex, or using a power purchase agreement (PPA), can help key decision-makers to make informed choices that best suit their business and budget.
When demonstrating the financial viability of investments, it is important that businesses consider both the short- and long-term impacts of sustainability initiatives. This will enable businesses to prioritise the most impactful initiatives, which will allow them to allocate resources effectively. Gaining a clearer understanding of the financial impact of sustainability initiatives means businesses can more easily justify investments.
While the current turbulent market makes it difficult to obtain these financial projections through static modelling alone, project analysis and management platforms such as True, powered by Open Energy Market, can leverage real-time data of your business’ energy consumption and help to assess the viability of different energy mix pathways.
Having support from within your business, at various levels, can be instrumental in enabling you to develop a compelling business case for sustainability.
One way to achieve this support is through having a dedicated sustainability manager, or sustainability team. Investing in people who can focus time into the drive towards sustainability will ensure that your business stays on track, as those people will be driving efficiency, and looking at reporting and methods of improving processes.
The other way to achieve this is through engaging with colleagues to rally internal support for sustainability initiatives. Sustainability, finance, operations and procurement teams can lend diverse perspectives to a shared interest in sustainability, and internal advocacy can be a powerful tool as it demonstrates how important sustainability is to the business community and can lead to action.
Whether support for sustainability comes from dedicated individuals, or a group of sustainability changemakers, having support is an important step in building a compelling business case.
Amidst the growing significance of ingraining sustainability into everyday business practices, research of 150 CFOs by Open Energy Market shows businesses remain deterred by expenses (39%) and lack of support (28%). This reluctance towards net zero makes it difficult to build compelling business cases and garner the level of investment needed to effectively meet decarbonisation ambitions and commitments. However, by accurately understanding your company’s energy usage, assessing financial viability, and securing internal support, you can develop a solid business case for sustainability and drive net zero progress.