The private sector has an important role to play in accomplishing the world's sustainable energy goals. Businesses can play a leadership role as innovators, solution designers and drivers of investment, working together with governments to achieve the objectives of the United Nations' Sustainable Energy for All.
This global initiative aims to ensure universal access to modern energy, improve energy efficiency and promote the deployment of renewable energy. Currently, more than 3 billion people lack access to modern energy services, with energy consumption set to surge in the coming decades, fuelled by Asia's expanding populations.
In a recently-released report, the United Nations Global Compact and Accenture recommend and analyse the most important actions the private sector can take across 19 different industries to advance the objectives of Sustainable Energy for All while simultaneously driving business value.
Their recommendations are based on several key findings, including the following three consumer preferences:
- 90 percent of consumers worldwide want more renewable energy
- 79 percent of consumers worldwide have a more positive perception of brands produced with wind energy
- 50 percent of consumers worldwide would pay extra for products based on renewable energy.
The report highlights four key ways the private sector can drive business from sustainable energy actions. Firstly, driving revenue growth by developing and adapting products for current and new sets of customers and expanding into new markets for existing or new products.
Secondly, reducing costs by employing energy efficiency measures. According to the United Nations Global Compact-Accenture CEO Study, 91 percent of CEOs will employ energy efficiency measures to address sustainability issues over the next five years. The potential energy savings for industry could equal the total annual electricity consumption of the US and China combined.
Thirdly, enhancing branding by developing a strong association to sustainability, so as to gain competitive advantage with consumers, crucial in increasingly commoditised markets. And fourthly, hedging business risk by deploying renewable energy, which can shift a company's energy budget from a variable to a fixed cost.
While acknowledging the differences among industries, the report notes that there are common themes to inform four priority actions that all executives can consider.
For instance:
- Driving revenue growth
Companies can provide more energy-efficient products and services. One notable innovation is cold-wash clothing detergent
- Reducing costs
The energy efficiency of operations can be increased. For example, the airline industry is using limited power to taxi, reducing the weight of onboard equipment, and shortening the flight path distance during takeoff and landing.
- Enhancing branding
Stakeholders can be educated on how to achieve energy efficiency as part of brand-building. Utility companies can educate consumers on energy-efficient practices and appliances, or provide free energy audits.
- Risk Management
The use of renewable energy can be increased in operations. For example, bio-based chemical feedstock can be used to replace petrochemical raw materials and also serve as new building blocks for chemical production.
The report points out that these proposed actions are not just limited to heavy-duty industries. The retail industry and professional services firms are also among the contributors to green efficiency.
Massive global business opportunities will be increasingly driven by a shifting energy landscape. Business leaders should understand the tie between this changing landscape and their own growth strategies, and fully tap into such a dynamic shift.
BY: The United Nations Global Compact & Accenture