In response to rising energy prices and the threat of a winter without enough fuel to keep Europe warm, governments across the continent are taking action to reduce consumption across state, corporate, and household entities.
Last week, Germany announced a €200 billion package to help consumers and businesses cope with rising energy prices, while a freeze on bills in the UK is expected to cost some €160-180 billion.
Locally, the Government has earmarked €608 million for energy subsidies in 2023, following an expected spend of €472.5 million this year.
The new name of the game is energy efficiency, which can be a lifeline for businesses’ bottom line.
Dan Smith is director of energy services at energy consultancy ClearVUE.Business, and has spent decades helping businesses manage their energy costs.
Put simply, energy efficiency is the practice of using less energy to accomplish a task. This lowers businesses’ energy costs and their emissions. In fact, the average company could reduce its energy bill by up to 30 per cent by implementing energy efficiency measures.
Energy efficiency has many benefits for businesses. Due to inefficiencies and energy loss, many companies use more energy than they actually need. Implementing energy efficiency tactics can eliminate unnecessary expenditure and has positive knock-on effects on the environment. Research by McKinsey found that energy efficiency represents about 40 percent of greenhouse gas reduction potential.
Anywhere that energy is used, there is an opportunity to improve efficiency. A major visitor attraction in the UK was able to save £15,000 (€17,156) a year by simply turning off its water fountain feature at night.
Car manufacturing company Morgan Motor Company meanwhile identified machinery that had been turned on needlessly early in its daily production processes. By simply switching it on later in the day, in alignment with operational requirements, it was able to save significant sums.
Optimising energy use and increasing efficiency is an incredibly straightforward and simple way to reduce energy costs. It can be difficult to know where to start, but new technologies are making it ever easier to identify potential savings by providing real-time energy and carbon reporting, helping businesses implement reduction targets.
An Expert Explains is a BusinessNow.mt initiative to improve economic financial literacy by inviting industry leaders to explain technical terms in a manner that can be understood by a general audience. If you would like to suggest a term or concept for our network of professionals to break down, or if you are an expert willing to contribute to this column, send us a message on our Facebook Page.
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