EDF: Energy Efficiency Now Strategic and Central
Since 2008, The Environmental Defense Fund’s Climate Corps program has placed graduate school level fellows with 350 organizations. This helps those organizations – and gives the EDF a unique perspective into the overall growth and evolution of the commercial and industrial sectors’ energy efficiency efforts and strategies.
This week, the EDF released a report on trends. The bottom line is that energy efficiency spending by the organizations have undertaken more than 3,200 projects during the course of EDF’s involvement. Spending on initiatives has increased from $7 billion to $16 billion between 2006 and 2014.
Perhaps even more significantly than the raw numbers, the nature of the projects are increasingly strategic and ambitious. The takeaway of the report is that since 2008, environmental and energy efficiency priorities have moved from the periphery to the center of corporate concerns. The EDF found that companies in the program “are engaging in more high-level and strategic energy management activities” over time and that they are continuing to increase project scale and scope.
Organizations are baking this type of projects deep into their overall corporate approach. “[W]e have seen companies shift from using fellows to identify immediate opportunities to save money through retrofits to using them to design multi-year, complex energy management strategies,” EDF Climate Corp Director Liz Delaney wrote in response to emailed questions from Energy Manager Today. “All of these trend lines indicate that energy management has shifted from a one-off activity to a strategic priority for many companies.”
The study suggests that the environmental benefit of the projects has grown faster than their perceived financial benefits. “We saw the carbon emissions reductions associated with energy projects outpace the growth of the size of the projects, meaning per dollar spent on energy efficiency, companies are getting more environmental bang for their buck,” Delaney wrote. “This is likely due to technology improvements, but also ties back to the theme of strategy. Companies are being more strategic about where they invest their dollars, and many may be using associated carbon reductions as a factor in their investment decisions.”
The fact is that ownership and corporate leadership sees energy efficiency as a benefit – not a necessary evil – builds momentum and is vital. “Building owners can do a lot to support energy managers,” Delaney wrote. “Setting goals and aligning incentives to reward staff for efficiency gains is a great start. Another step would be to allow for some experimentation, whether it’s with on-site solar, green leases, using commercial PACE for financing, or some other approach. Ideally, building owners and company executives would see the value derived from strategic energy management and allow their sustainability and energy managers to push past the low-hanging fruit to realize the full potential that energy efficiency and renewable energy offer.
Companies that participate in the program – especially in the earlier years – are likely to be inherently sensitive to energy efficiency and environmental concerns. Even in this group, the EDF identified barriers. The report said that programs can be slowed by lack of high level support, lack of funding, lack of staff and/or expertise and lack of visibility or reporting on progress. There also can be “limitations of project analysis or insufficient data and tracking.”
So the news is good — but work remains. “[T]here are things that energy managers should consider,” Delaney wrote. “To EDF, strategic energy management means paying attention not only to executing energy projects, but to executive engagement, reporting, employee engagement and measuring results. We hope that energy managers will read this report and be inspired to do even more to overcome the persistent and dogged challenges they face, as the economic and environmental opportunities associated with strategic energy management are only getting stronger.”
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