The decentralised energy 'toolkit' can transform sustainability
Distributed energy technology is providing a roadmap to a lower carbon future for the UK, and a more sustainable future for business.
UK organisations must place innovation at the heart of sustainability action planning if they are to deliver on tougher carbon reduction targets and continue their global leadership in fighting climate change.
While businesses and public bodies have already made a big contribution to the UK's decarbonisation progress, a shortfall is predicted in meeting future carbon reduction targets. These legally binding targets include a 57% cut in 1990 emissions by 2030, and at least an 80% reduction by 2050.
Since industrial businesses currently account for 25% of UK emissions, they have a responsibility to lead on sustainability. The importance of this is underlined by the recent report by the UN Intergovernmental Panel on Climate Change (IPCC), which warns of the devastating environmental impacts of failing to limit global warming to 1.5 °C above pre-industrial levels.
The government has laid down a challenge to businesses, through its Clean Growth Strategy, to increase energy productivity by at least 20% by 2030. Around 12,000 large businesses will also be held to account on their environmental performance via the proposed new Streamlined Energy and Carbon Reporting Regulations (SECR), due to come into force in April 2019. Eligible companies will be required to report on carbon emissions, energy use and energy efficiency actions through their company accounts.
The distributed energy opportunity
Doing more of the same is no longer enough to meet the challenge ahead. That's why energy leaders across business, industry and the public sector are using distributed energy technologies to achieve a step change in energy performance. This innovative approach is providing a clear and proven roadmap to sustainability.
The distributed energy 'toolkit' combines energy efficiency and advanced energy insights; on-site power generation and combined heat and power (CHP); solar PV; Demand Side Response and supply optimisation, and battery storage. These technologies are now more accessible and affordable than ever before and can be financed via ongoing energy savings, without sacrificing other capital investment.
Our new report, 'Distributed Energy - Powering sustainability', explains how organisations can use distributed energy solutions to take control of their energy use and realise competitive and environmental benefits. These include better brand reputation, increased energy resilience, higher efficiency, lower costs, lower emissions and new revenue streams.
Uncovering carbon emissions savings
We've modelled the potential emissions saving opportunities of applying this approach to three key economic sectors of manufacturing, the health sector, and hospitality and leisure. By 2030, this could provide total cumulative savings of almost 137m tonnes CO2e across these three sectors alone, sufficient to contribute a 3% reduction to the UK's entire carbon budget.
Our estimates show that if 50% of UK organisations across manufacturing, the NHS, and hospitality and leisure sectors implemented a suite of decentralised energy solutions, they could deliver:
- Annual savings of 7.2 million tonnes CO2e
- Equivalent to 11% of the sector’s current carbon footprint)
- Total emissions savings of 106 million tonnes CO2e by 2030
- Improved international competitiveness and resilience
- Annual savings of 483 thousand tonnes CO2e
- Equivalent to 16% of sector’s current carbon footprint)
- Total emissions savings of 8.8 million tonnes CO2e by 2030
- Improved resilience and patient and staff comfort
- Significant cost savings that could be reinvested in patient care,
- Annual emissions savings of 1.3 million tonnes CO2e
- Equivalent to 14% of the sector’s current carbon footprint)
- Total emissions savings of 23 million tonnes CO2e by 2030
- Major cost savings that could be invested in enhanced customer experiences
- Improved operational resilience and brand reputation
The 4 steps sustainability action plan
Centrica Business Solutions helps public and private sector organisations to deploy a complete range of distributed energy solutions. We advise customers to consider the following five key steps to developing an effective energy and carbon saving action plan.
1. Increase visibility to inform your energy saving strategy
Measure energy use with advanced software analytics to reveal deep energy insights across your entire organisation. This will highlight areas for immediate gains and help build a focused case for further investment.
2. Balance energy sources
Augment your existing energy sources with energy efficiency improvements and on-site generation and capture solutions, such as CHP, solar and battery storage. You can dramatically improve cost and carbon performance, while improving resilience. Combine your supply, export, flexibility and trading to unlock full value from your energy assets and maximise both commercial and environmental returns. Use initiatives such as Demand Side Response (DSR) to earn revenue, while balancing the grid and supporting decarbonisation.
3. Reduce energy risk
Carry out regular assessments of the risks posed by disruptions to supply and build a robust energy resilience plan to prevent energy-related failure.
4. Link energy and business plans
Develop a formal energy strategy, which aligns your energy goals with business outcomes and ensures that energy sustainability is both a board room and plant room issue.
Take urgent action to transform sustainability
We are supporting hundreds of organisations in their transition to a lower carbon economy by capitalising on the decentralised energy opportunity. Read our case studies to see how businesses and public bodies are benefitting; and get in touch to find out how Centrica Business Solutions can help you develop and implement a sustainable energy action plan.