Sustainable Energy Climate Change - From the Corner Office

Climate Change & Sustainable Energy Strategy



Every CFO or business owner would agree that energy costs are a budgetary line item that cannot be ignored. Depending on the type of business, energy can account for up to 60% of total expenditures. Energy expenditures can range from 20% for a typical office building to up to 60% or more for heavy manufactures. While managing energy costs are essential for a successful management plan, many companies fail to realize the benefits of taking a holistic approach to energy management, missing out on tremendous opportunities to better manage risk, improve resilience, and create additional value.

In the modern economy of the 21st century, energy costs remain an important component in a commercial energy management plan, however, how a company manages its energy can transcend from the expense department into the investor or customer relations arena, by demonstrating a commitment to corporate, social and environmental responsibility. With the continued pattern of frequent catastrophic weather events, global society has become extremely concerned with climate change and the reduction of carbon emissions. Consumers are demonstrating increased loyalty toward more sustainable products and companies.

Many businesses continue to ignore the increasing social pressures and overlook the financial, environmental and social benefits of renewable and other sustainable energy technologies due to the stereotypical view that they are too expensive ignoring the fact that the costs of such technologies have and continue to plummet.

The true impact associated with implementing, or failing to implement sustainable energy technology should be measured against the cost of doing nothing.

Not only have the cost of renewable and other sustainable technologies fallen to extremely affordable levels, in many cases, there are tremendous federal and state incentive programs that allow properly managed projects to deliver positive cash flow from the very start. In addition, banks and other financial institutions better understand these technologies allowing for attractive financing options eliminating the need to commit working capital to a project.

In the 21st century, many larger corporations are realizing the benefits of holistic energy management and have invested billions of dollars in building resilient and sustainable energy infrastructure. Besides the tremendous financial benefit, these investments are making a strong statement regarding the corporate commitment to the environment, which in turn provides brand recognition and substantial social value.

As more and more businesses embrace and realize the benefits of sustainable business practices, they are turning an eye toward their supply chains and in some cases pressuring suppliers to implement more sustainable business practices. This is becoming a growing trend in today’s economy, presenting a challenge for small and medium companies with limited understanding and resources to commit to sustainability. While the benefits of  sustainable business practices have been proven over and over again, like any component in a business plan, it comes down to execution.

For the small and medium company that may be feeling pressures from their larger clients, it is essential not to panic into making hasty decisions in fear of losing a large client. Although sustainable energy technologies have the ability to deliver profound financial and environmental returns, the planning and execution of such projects is the key to their success. There are many moving parts to every sustainable energy project, such as: timing, identifying the most lucrative incentive programs, financing, quality control and project specific risks that must be professionally managed. Partnering with the right energy management company that will help develop and execute a holistic energy management plan will ensure your company receives the maximum financial and environmental return on every dollar invested in your energy budget.

In conclusion, the value of taking a holistic approach to managing commercial energy budgets can make an impactful statement regarding a corporate culture that embraces environmental and social responsibility while lowering costs, reducing risk and providing resiliency. For any sized company that hasn’t embraced the benefits of sustainability and holistic energy management, don’t wait until you get a tap on the shoulder from your largest customer; get ahead of the trend and call NJGEC today to schedule a complimentary energy management analysis.

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